THE WEEK. The Otago Witness WITH WHICH IS INCORPORATED THE SOUTHERN MERCURY (WEDNESDAY, AUGUST 23, 1905.)

Otago Witness, Volume 23, Issue 2684, 23 August 1905, Page 48

THE WEEK.

The Otago Witness WITH WHICH IS INCORPORATED THE SOUTHERN MERCURY (WEDNESDAY, AUGUST 23, 1905.)

•■Xum«i» mliud murt, aliud wpientU dixit."— Jvtsvai. k Sooi) nature mad food uuc stun »T»r j»ia v ' r — feri, The .latest news from Portsmouth holds out little hope of the Peace Poor Prospects Plenipotentiaries being able of Peace. to arrive at a satisfactory solution of tie difficulties Between Japan and Russia. President " Boosevelt, by inviting Baron Rosen to meet him, hias apparently^ done his best to surmount the existing deadlock, and if Boosevelt and Rosen are unable to find a way out all, the urgings of King Edward, President Loubet, and tbe Kaiser are not liikely to have much effect. The whole discussion practically centres round the question of indemnity. M. de Witte is reported to have said that whilst Russia will reimburse Japan for the maintenance of Russian prisoners, she will not pay one copeck of indemnity ; and further remarked that talking to the Japanese was like talking to graven images. That M. de Witte correctly represents the Russian official mind is confirmed by the report from The Times' correspondent that the Council under the Czar has unanimously declined to grant further concessions. On the other hand, the Japanese Gabinet has met, and, according to Count Katsura's ' jtatement, gees no reason to abate one whit - of its demand. The Japanese Premier Informed, Dr Morrison that when the conditions of peace were drafted Japan _ brushed aside certain proposals, which tbe nation regarded as essentials, and reduced the terms to the smallest possible, the most reasonable, and the most obvious. The continuance of the war, therefore, . seems inevitable, for Japan regards the proposals she has put forward as the irreducible minimum, and these Russia is by no means content to accept. Indeed, the past history of Russian diplomacy renders it exceedingly unlikely that any intervention on the part of the Powers will bring about a permanent peace. It Is only at the psychological moment when Russia really recognises her defeat, and that she must make peace, that Japan will obtain what she now asks. And evidently that moment has not yet arrived. Professor Maartens has laid it down that there- is no precedent in The Indemnity history for a country whose Due to Japan, territory has not been partially or wholly occupied by fch? enf-my paying «a war tribute on signing terms' of peace. To which The Times aptly retorts that the Professor has overlooked the occupation of 1 Saghalicn by the-Japanese, to say nothing of the huge Indemnity squeezed by Russia out -of China at the time of the Boxer outbreak, tn the July number of the Nineteenth Century, Mr 0. Eltzbacher, a recognised B.ut?foority in international finance, deals very fully- with the indemnity question, j,nd it will prove instructive at this juncture to briefly follow his argument. He holds that as the war, on Japan's ride, was undertaken purely for defensive ourposes, she has an undoubted right, in )he first place, to claim full monetary compensation for the expenditure and for bie losses to which she has been p_ut

|by reason of Russia's aggression. And ' in the second place, Japan is entitled to demand certain substantial guarantees calculated to make a future war of revenge I on the part of Russia impossible, or at 1 least unlikely. Mr Eltzbacher estimates I that the minimum of Japan's actual exI penditure for the war and the financial losses she has suffered through the war are as follow : — Moneys raised for the -war, by loans and otherwise .. .. £116,300,000 Compensation for partly and wholly disabled cripples, and for widows and orphans . . 30,000,000 Compensation to civil population for damages suffered through. mobilisation, loss of trade, etc 15,000,000 Wear and tear of -war material, liquidation of the wax, and various expenses •• •• 20,000,000 Total £181,500,000 But according to the precedent set by Germany in 1871, Japan (so Mr Eltzbacher opines) is perfectly entitled to claim considerably more than her war expenditure and compensation for losses. Germany extorted from France £200,000,000, or four times, more than the actual cost of the . war ; and following Germany's precedent Japan is perfectly justified if she claims a round £200,000,000 from Russia, and employs the balance above her actual outlay and losses for the peaceful development of Japan, and especially of Korea, where railways, harbours, telegraphs, roads, schools, industries, etc., have to be created, and where good government has to be introduced. The inquiry undertaken by Mr Eltzbacher into 6oms of the outstandSorae Reasons ing reasons for Russia's refor Russia's fusal to consider the quesBefual. tion of an indemnity forms by no means the least interesting part of an interesting article. The first reason advanced is Russia's alleged inability to raise £200,000,000 after a costly and exhausting war. To this the obvious reply is that Russia may be compelled to gass through a similarly trying financial ordeal as did her ally Prance 34 years ago. On the other hand, it is argued that the reason why Germany was able to compel France to pay so heavy an indemnity was only because Germany was able to hold valuable French territory as security until the last centime was paid — that the cases are not analogous, for Japan is unable to seize valuable Russian territory and hold is as security. To this objection Mr Eltzbacher has an effectual reply. He says: — "Those Russian statesmen who affect to think that Russia may with impunity draw out the war at will and refuse to pay a war indemnity to Japan? because Japan cannot seize valuable Russian property as a security for eventual payment, are mistaken. Eastern Siberia is worth considerably more than £200,000,000 to Japan, or to those to whom Japan might conceivably choose to cede that country, or certain privileges in that country. Siberia is the wealthiest •part of Russia, and under a good government it would soon become populous and exceedingly prosperous. Eastern Siberia has, perhaps, the best grazing grounds in the world. It possesses a first class black agricultural soil, and the richest fisheries in the world. If Russia should think Eastern Siberia not worth £200,000,000, Japan may think it cheap at the price, and she would probably be able to extract £200,000,000 in money from that country within a few years by giving to an English or American syndicate a few concessions for building railways in Siberia, or for exploiting the mineral wealth of the soil." The conclusion forced upon the observer, therefore, is that Russia can scarcely avoid in the long run paying the Japanese wax indemnity, unless she is willing to evacuate not only Manchuria, but the whole of Eastern Siberia as well. Russia has been defeated on sea and on land, and her only chance oi The Profit retrieving her laurels lies m and Los the hope of wearing out of Delay. Japan. But the hope appears a vain one, for the fact remains that at the present time Russia cannot borrow money either at home or abroad, whilst Japan is able to raise all the loans she needs with comparative ease. Thus Russia is likely to be hopelessly bankrupt long before Japan's financial resources are exhausted. It is reasonable to suppose that in the event of the present peace negotiations proving futile Japan's demands will become greater. It is in the nature of things that Japan should increase her claim the longer Russia delays an equitable settlement. Mr Eitzbacher argues that if Russia honestly wishes to conclude the war with Japan she will be well advised to do so quickly. To continue a hopeless ■war is a very costly luxury, even for the richest country, and Russia should re member that every day adds about £500,000 to the bill she will eventually have to pay. Every day, therefore, means an additional burden to every Russian taxpayer. And Mr Eltzbacher points out that the Russians should take warning from the experience of the French. "On the 19th of September, 1870, seventeen days after the Battle of Sedan, Jules Favre, the French Minister of Foreign Affairs, had a conversation with Prince Bismarck in order to ascertain Germany's conditions of peace. Bismarck then demanded, if I remember rightly, only the cession of Alsace and the sum of £80,000,000, but, as Favre dramatically refused to cede ' an inch of French ground or a stone of our fortresses,' the negotiations fell through, and the war continued. Six weeks later, on the 31st of October, Adolph Thiers approached Bismarck in order to conclude peace. His mission also was unsuccessful, but meanwhile Germany's demands had risen, and Bismarck bow; asked for Alsace and

£120,000,000 in money. In December, 1870, Bismarck declared that he would require £160,000,000 in money. At last, in February, 1871, the peace negotiations were successful, but then Germany demanded and obtained not only Alsace, but Lorraine as well, and £200,000,000 in cash. Ite failure of the Czar and his Ministers to grant sucrli constitutional ffanted a Man reforms as will satisfy the at the Helm, clamant needs of the Kussian people goee to show that the present crisis m the affairs of the Empire calls loudly for a man, at the helm. Bismarck had the habit of saying: — "In order to gauge the drift of Russia's policy, on© must always know who the man is who for the time being has the greatest influence over the Czar." At present t ! he apparent incapacity of the Czar to come to a wise decision at a momentous crisis is owing to the fact that he is influenced, not by one man, but by many men, and a few women as well. Russia is ruled by absolutism, and a country which is so governed requires either a personal ruler of talent or energy, such as Peter the Great, or an impersonal ruler, such as Catherine 11, or William I of Germany, who would allow a man of talent and energy to reign in their stead, and who loyally and unflinchingly supported that man against his enemies and detractors. In all countries which are ruled by one person, or by one set of persons, there is a continuity of policy, but in an autocracy which is neither ruled by the autocrat nor by a Minister, or an acknowledged favourite, even if that favourite be a barber or a mistress, but in which those people, who, for a fleeting moment, gain the ear of the monarch, and direct the policy of the State, confusion takes the place of a policy ; and this appears to be the case with Russia. There is no doubt that in their perplexity the Russian Bureaucracy desire to stave off the evil day, in tlhe hope that one of the Powers may intervene. But in the meantime Russia is rapidly forfeiting her position as one of the Great Powers of Europe, and her voice has now scarcely any weight with other nations. Russia has fallen, from her high estate, but unless she speedily makes peace there may be yet greater humiliation in store for the Muscovite Empire.