JUGGLING WITH FORTUNE

Dominion, Volume 11, Issue 42, 13 November 1917, Page 6

JUGGLING WITH FORTUNE

HOW GERMANY FINANCES THE WARFARE

MR. GERARD PROPHESIES A

LONG WAR

Mr. James W. Gerard, ex-Ambassador of the United States in Germany, in the course of a speech at a luncheon given b.y the Ad. Club in San .Francisco on October 3, said, according to tho "Chronicle" "First, I want to tell you that there is no danger of a hunger pcaco from Germany. That country will find means to hold out on the food question, no matter how long the war lasts. Also, let me say at the start that there will be no revolution in Germany during this war. A revolution there may be, but it will come after peace has been restored. And there will be no end to the war because of a weakened man-power, in Germany. Heavy as her losses have been, they have not made a serious impression on the man-power of tho 13,600,000 men who have been called to the colours for soldiers, muntion workers, or other wartime work. The only thing that is weakening Germany, the one cause that may end the war before attrition wears them down to the breaking point, and may obviate the nocessity of a military decision, is the economic pressure that is ever increasing, and which the.thinking people of Germany already realise is the proverbial last straw that will make the burden too heavy to oarry. War Fund Raised by Loans, "To make plain the pressuro of economic conditions let ine present these facts: "Germany is not raising, and never has raised, her funds to conduct the war by taxation, J>ut by loajis. When this polioy was' aimouuoed at tho beginning of the war it was explained by those in authority that Germany's enemies would be mado to pay the cost of the war by tho indemnities that would- be levied, following Gormany's victory, hence there was no need of taxing tho people. Noi the German people, jiut their enemies, will bear tlio burden of the leaden billions, they were told. Hence, the only added tax in Germany is a 50 per cent, tax on war profits. Even their income tax has not been increased. As a result Germany to-day is oil the verge of moral, social, and financial bankruptcy. Her people know that there will be no indemnities collected. They know that Germany cannot win. And they know that every day the cost of the war is approaching" tliat point where tho interest on ho indebtedness of their coutiy will wipe out and exceed the annual increment of tho wealth of tho nation, and that point spells national bankruptcy. ' I was told that Germany's national debt now exceeds one hundred billion marks, and that the maximum annual increment of the nation's wealth is only ten billion marks. Figure for yourself the interest on the larger sum and see how close they are to the line that Bpells disaster. The business men of Germanv see that now, and are uneasy. Also they see tlieir foreign trado gone-nnvuch of it for ever-wliich will.make it all the hardor for Germany to recover. German business men used to argue that they were safe financially becauso all of Germany s war funds wore spent in Germany, while their enemies were spentjine theirs with other nations. False Economy Seen. "Now they know that this is false political economy, but it shows how the financial jugglery of tho Government has been able to fool thj people all this tinie. iiowever, wo are in for a long war, 1 believe, because the autocrats will tako any chance and run any risk rather than mako a poace thai has not the sembance of a great German victory. 'J'lioy dare not make such a- peacc. 'l'liey have promised tho German people victory and world dominion, and it would ]io suicidal tfcr them to mako a peace that falls short oi their premises. After war I look for the German people to riso up and revolt against tho autocratic powers that led thorn into tho war with falso promises.