Initially, this large state was governed by the Sejm, a democratically elected parliament based on the French model. However, the 92 political parties, the introduction of proportional representation, and the exuberant individualism of the Polish intelligentsia made parliamentary government difficult. In 1927, Marshal Józef Piłsudski, who had played a major part in the formation of the new Poland, decided to end the ‘chaos’, and established a military dictatorship. His government lasted for twelve years before it was terminated by Hitler and Stalin. After the Second World War, the country was stripped of its eastern ‘minorities’, and the German-speaking population was expelled. Poland became the homogenous nation it is today.
Romania, although it had played only a minor part in the defeat of the Central Powers, did well in Paris, where it received Bukovina from Austria, and the Banat and Transylvania from Hungary, doubling its population and territory. In 1920, it also wrested Bessarabia from Russia. Like their Polish and Yugoslav counterparts, the Romanian leaders had been loud in their support for ethnic self-determination when it came to their neighbours, but did little to follow such principles at home. Impressive lists of minority rights had been enacted, but they were scarcely adhered to, leaving large populations dissatisfied and unwilling to be mobilised when the need arose.
The new states — characteristically referred to by the Germans as ‘season states’ — looked impressive on paper, but they failed to provide domestic stability. To this was added their failure to ensure harmonious relations between themselves. Consider, for example, the fate of the small duchy of Teschen, located in the west of the former Austrian province of Galicia, which bordered the Upper-Silesian coalfield. The population of half a million people was around two to one Polish. The Czechs claimed Teschen because its coal was vital to Czechoslovakia and because the railway junction there connected the Bohemian and Slovak parts of the new state. Although little stood in the way of a cordial settlement, Teschen led to acrimonious quarrels between the Czechs and Poles during the peace conference and after, until a compromise pleasing neither side was reached. 30 A close political and military alliance between the two countries would have benefited both, but as a result of the Teschen conflict, relations remained tense in the inter-war period. This was symptomatic of the entire region, and French hopes that Yugoslavia, Romania, Poland, and Czechoslovakia would provide a reliable counter-balance to Germany in the east did not eventuate.
Of the defeated powers, Bulgaria escaped relatively unscathed. The Treaty of Neuilly stipulated that it had to return some of the lands it had gained in the peace of Bucharest, and the Bulgarians lost access to the Aegean Sea, about 10 per cent of their territory. They also had to pay reparations of £90 million and reduce their army to 20,000 men, neither of which they ever did.
Austria and Hungary, the two pillars of the Habsburg Monarchy, did not fare well. Both were reduced to rump states. Hungary received harsher treatment because at the time of the peacemaking its government was in the hands of a Soviet council. 31 Austria was politically isolated and economically cut off from its traditional trade links, and found it hard to make ends meet in the inter-war years. This helps to explain why the Austrians accorded their fellow countryman Adolf Hitler such a tumultuous welcome in Vienna on 12 March 1938. The aspect of the St. Germaine peace treaty the Austrians most resented was the loss of South Tyrol, a German-speaking region south of the Brenner Pass. This was awarded to Italy.
The Italians had originally been part of the Triple Alliance with the Austro-Hungarian and German empires, but did not join the war in 1914. For nine months they watched to see which way the wind blew. They joined the Allies in May 1915, enticed by the promise of rich rewards, among them South Tyrol. Thus the Allies were saved from having to fight on another front, and one potential enemy had joined their own ranks. In practice, Italy’s military contribution to the defeat of the Central Powers was modest. All attempts to invade Austria-Hungary from the south were rebuffed, the attackers suffering huge losses. The Allies, however, kept their promise, offering up a sizeable stretch of territory around the northern Adriatic coast and South Tyrol. President Wilson had qualms about allocating this German-speaking community to Italy, because Point Nine of the Fourteen Points held that the frontiers of Italy should be effected along clearly recognisable lines of nationality. The Italians, however, reasoned that without possession of the lands south of the Brenner Pass, their country would be left open to future aggression from the north, and to this Wilson assented. Nevertheless, the original list of Italian expectations had been much longer, 32 and they were angered in particular by not being awarded the city of Fiume. Dissatisfaction with the peace treaties, coupled with never-ending political and economic instability — the post-war Italian governments stumbled from one crisis to the next — led to Mussolini’s ‘March on Rome’ on 28 October 1922. Italy would become the first country to fall to fascism.
The ink on the treaties had not dried before loud claims were being made that the Allied peacemakers had dealt arrogantly with the fate of millions — assigning national minorities here, taking whole folks-groups away there, and all by the stroke of a pen. Such claims are too generalised, and in many instances false. To have imposed every condition of the Fourteen Points would have involved major military intervention, something that was out of the question in 1919 or early 1920. Given the ethnic pluralism of the region, no border was immune from the cry of foul play from those who claimed to have lost out. As stated above, the peacemakers faced a fait accompli in central and eastern Europe, and they agreed to borders that had been established by the states themselves. The development of fair, co-operative, and productive policies that might have led to a better outcome for the post-war world was in the hands of the rulers of the new ‘nation states’. Their failure to develop such policies contributed to the catastrophic course history was to take in the 1930s and 1940s.
Key issues
In making peace with the German empire, which was the chief item on the Paris agenda, the Allies were confronted by two key issues: how to set compensation for the costs of war, and how to provide France with security against an eastern neighbour whose superiority in size and industrial potential could not be altered even after its defeat in war. In his various announcements during the war, president Wilson had stated that the settling of war costs should not include indemnities, payments for expenditure incurred in military operations, and the staging of the war. These, to him, were relics of a bygone age. Restitution was only to be made for unlawful acts of war.
This vague concept met opposition from the Europeans. They were not willing to abandon the traditional principle ruling European peacemaking for the past hundred years: loser pays, winner takes all. In the November 1815 Treaty of Paris, which ended the Napoleonic chapter in French history, France was made to pay 700 billion francs and the cost of an occupation army of 150,000 men for three years. The Kingdom of Prussia, together with Austria, collected handsomely from Denmark after winning the first of Bismarck’s ‘unification wars’, the Kingdom of Denmark losing one-third of its territory and almost half of its population. Prussia did even better from the ‘Second Unification War’ fought chiefly against Austria. The Kingdom of Hanover was annexed outright, and Bismarck also confiscated the assets of the royal dynasty, the Guelphs, amounting to about five million goldmarks. The electorate of Hesse and the Free City of Frankfurt were also annexed, the citizens of Frankfurt having to pay an indemnity of over 30 million guilders. The Kingdoms of Bavaria and Württemberg and the Grand Duchy of Baden, too, paid heavily for siding with the Austrians. Bavaria, for example, was obliged to pay an indemnity of 51 million goldmarks, making the 32 million Ludwig II needed for the construction of his fanciful castles, which so enraged the Bavarian political establishment of his time, look relatively modest. The thrifty Bavarians could not know that the Neuenschwanstein Castle would, a century later, rank as the state’s main tourist attraction, and, courtesy of Walt Disney, would become the fairly-
tale castle par excellence, giving joy to millions of children around the world.
For strategic reasons, Austria was let off the hook, although the Austrian emperor had to give assurances that the empire would never again meddle in German affairs. In the peace of Frankfurt that ended the Franco-Prussian War of 1870–1, France had to pay to the newly founded Second German empire 20 billion goldmarks, in addition to occupation costs. The plundering of defeated enemies peaked in the Treaties of Bucharest with Romania — which had to cede large territories to the Habsburg Monarchy and Bulgaria and its oilfields to Germany — and the Treaties of Brest-Litovsk and Moscow with Russia.
For the European Allies, it was now Germany’s turn to pay. They had no intention of plundering Germany but, not unreasonably, they wanted to be reimbursed for the damage done by German occupation and to recover at least part of their outlays.
The Pre-Armistice Agreement of November 1918 had stipulated that Germany had to make compensation for all the damage done to the civilian population of the Allies and their property by its aggression on land, sea, and air. This suited France, where most of the fighting on the Western Front had taken place. In the ten French departments that had seen the heaviest fighting, around 600,000 houses, 20,000 factories, and 6,500 schools had been destroyed, 4,000 villages levelled, and three million people driven from their homes. This region also contained the centres of the French iron, coal, wool, and cotton industries. Under a strict interpretation of the Pre-Armistice Agreement, France (and Belgium) could expect to receive the largest reparation payments.
The British did not share this point of view. Limiting reparations to damage done to civilians would mean that they could claim reimbursement only for the loss of merchant shipping. Yet Britain’s war expenditure had been greater than that of France’s, huge loans having to be raised to meet the costs. Britain owed the U.S. government loans amounting to $4.7 billion, and a further $2 billion to U.S. banks. The British had also lent large sums to Russia, which had defaulted on its debts, and to other European nations such as Italy and Romania, which were in no position to repay. France itself owed Britain $4 billion. In the emotion-charged aftermath of the war, it would have been difficult to explain to the people why their taxes had to pay for the costs of the war. The British Dominions, in particular, raised strong objections to a peace without compensation. The Australian prime minister, Billy Hughes, became their spokesman.
Hughes was convinced that he had a strong case. Australia had suffered a high casualty rate, and its soldiers had made valuable contributions to the defeat of Germany. Australian General John Monash had led the Australian and Canadian Corps in their breakthrough of the German trenches on the Somme on 8 August 1918, 33 and had contributed to the collapse of the Hindenburg Line a month later. Australian troops had also distinguished themselves by halting some of the most advanced units of the German March offensive at Villers-Bretonneux, the beginning of the collapse of Operation Michael. Hughes had already bitterly attacked the Pre-Armistice Agreement, being among the first to recognise its implications. In a series of passionate speeches and letters to the press, he maintained that, by accepting the agreement, Britain had forfeited her rights to war indemnities and that this would have dire consequences for the Dominions. 34 If Wilson’s views were to be sustained, Belgium, which had contributed little to the outcome of war, would be compensated, while countries like Australia would go empty-handed. To Hughes, there was no valid distinction between restoration and compensation:
Australia lost nearly 60,000 men killed and many more maimed for life. She has incurred a war debt of some £300,000,000 — a crushing burden for 5,000,000 people. And what is true of Australia, is true mutatis mutandis of the other Dominions and peoples of the British Empire. In the way of the destruction of civilian life and property, they may have suffered little. Yet the sacrifice they have made and damage they have suffered, have not been less. There must be for them, as for all the Allies full compensation. 35
He dismissed the American rejection of high reparations as unprincipled and self-serving. 36
Hughes’ criticism was not unfounded. For all Wilson’s talk of the ‘moral advantage’ in not claiming reparations, the United States did well out of the war. Its civilian war damage was small, as was the size of the its war debt. The United States had seized twice as many German merchant ships as it had lost, and had confiscated German property in North America to the value of $425 billion. 37 The United States also reaped enormous war profits from Europe. The French and British governments had hoped that the U.S. would provide financial assistance in the settling of their obligations. Indeed, there were even suggestions of cancelling outright all intra-allied debts. But neither president Wilson nor his government was interested in this.
On 10 February, Hughes was made chair of the Commission on Reparation. Most members of the commission were hardliners on reparations. Lord Cunliffe, a retired governor of the Bank of England, was a member, as was Lord Sumner, a Law Lord. They were supported by the Northcliffe Press, and took up a catch-cry on bleeding the Hun dry. The pair was called the ‘heavenly twins’ because of the astronomical estimates they advanced — initially $120 billion. This figure was reduced to $47 billion, but was still in striking contrast to sums suggested by the Treasury, whose representative, John Maynard Keynes, argued that Germany could pay $10 billion at the most. This sum, however, would have been unpalatable to an Allied public that had been promised rich rewards for its efforts in the defeat of the enemy. Eventually, to the relief of Lloyd George and Clemenceau, who had both made vast promises to their people, it was decided to leave settling the final sum to the work of a further commission.
The establishment of this commission helped to solve the impasse between Wilson and the European leaders. The South African minister for defence, General Jan Smuts, maintained that the Pre-Armistice Agreement allowed the Allies to include separation allowances for soldiers’ families, as well as pensions for widows and orphans. This was seen by opponents of the treaty as a further example of the piling up surrealistic reparation claims. In reality, the inclusion of allowances and pensions did not add to the final bill owed by Germany, but it did affect the amount each ally was to receive. 38 The share gained by Britain, which had suffered relatively little physical damage requiring repair, but had huge unfunded pension liabilities, was increased by reducing the shares of other allies. 39
It had also been agreed by then that there was to be an unlimited theoretical responsibility, but a much smaller actual German liability. Lloyd George and Clemenceau had explicitly insisted that Germany should acknowledge an obligation for all the war costs. The Americans feared that this would be a violation of the Pre-Armistice Agreement, and offered a compromise that would assign unlimited theoretical and moral responsibility for all the damage caused by the war to Germany and its allies, but confine the actual German liability to specific damages. This would greatly reduce the amount Germany was expected to pay. The British and French agreed to the compromise, which was placed in the reparation chapter of the Versailles Treaty (in paragraphs 231 and 232).
Solving the problem of France’s future position towards her powerful eastern neighbour proved equally difficult, threatening at times to break up the conference. It was important for the French to be compensated adequately for the devastation caused by war and occupation. Although the minister for finance, Louis-Lucien Klotz — according to Clemenceau, the only Jew who knew nothing about finance — joined for a time the ranks of those demanding surrealistic figures, French reparation expectations were on the modest side. As with so much regarding the reparation issue, the discrepancy of the sums given to the public and the amount realistically expected was vast. The future of French security, however, was of paramount importance. Twice within fifty years, the country had been invaded by Germany, the second invasion amounting to near apocalypse. In addition to the physical destruction of the countryside, towns, and cities, and the damage done to French industry, France had
lost 1.5 million men. Double that number had been injured. Although two million young Germans had also died, Germany would still have a post-war population of around 75 million, compared to France’s 40 million. No foreign soldier had set foot on German soil, no village been razed, no industrial compound dismantled or blown to pieces. The Rhenish-Westphalian industrial region — Europe’s largest coal-mining and steel-producing area — was still able to work at full capacity.
France’s hopes rested on two pillars: to confine Germany to the east of the River Rhine, and to continue the wartime alliance with the United Kingdom and the United States. French president Raymond Poincaré demanded that the peace treaty should push the French border with Germany to the Rhine, a position shared by the bulk of the media and a large part of the population. This would mean that the Saarland, the Rhenish Palatinate, and the Rhineland would become part of France. The Rhine had been the German border in the past, and the Rhenish, it was claimed, were in character and lifestyle much closer to the French than to the Prussians. Like the French, they were Catholic, enjoyed good food and wine, and (by reputation) took a more joyful approach to life than their eastern compatriots. 40 Such a view found no support with Lloyd George or the American president, who reasoned that downright incorporation of the left bank would create a new Alsace-Lorraine, a certain recipe for future disaster. As they could expect no assistance from the Allies, Clemenceau pointed out to those of his countrymen demanding this frontier the sacrifices that French occupation of the region would entail. Two hundred and fifty thousand men would have to be withdrawn from the workforce to guard the Rhine, stifling economic growth, and there would have to be wholesale reform of the region’s administration and governing structures.
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