and reschedule reparations payments more realistically. Finally, in 1929, the reparations
problem was tackled yet again, this time by a committee chaired by American banker
Owen D. Young. The ‘Young Plan’ envisaged German payment of reparations that would
not conclude until 19 88.
Not only did the reparations controversy poison international relations in what
otherwise was generally a period of cooperative statecraft, but it was linked in Europe,
and in London in particular, to the pace, and even the fact, of the Allied repayment of
war loans from the United States. Britain had borrowed $4,661 million and France
$3,991 million from the Americans. And after the war the Americans were insistent upon
strict repayment. European debtors sought to tie their repayment of debts to the United
States to their receipt of reparations payments from Germany. Unsurprisingly, the United
States rejected this nexus out of hand.
Germany lost all of its colonies to the Allies, though the transfer was effected under
the authority of mandates from the new League of Nations. Compared with the war guilt
clause, the loss of territory and ethnic Germans in Europe, and disarmament, though,
the loss of overseas colonies was a matter of little consequence for Germany. Given
that Germany was able to evade making much more than token payments towards the
shifting totals of reparations demands, and that the territorial and population losses were
more insulting than crippling, the settlement cannot be judged, objectively, to have been
especially harsh. There was an important area of exception to that judgement, however.
Despite its many successful and systematic evasions of treaty obligations, there is no
doubt that Germany was decisively disarmed. Its Versailles-sanctioned 100,000-man
Army was incapable of defending the country, let alone of taking offensive action against
a neighbour, while France maintained a notable military presence in the Rhineland until
- That French military occupation, two corps strong, was tied to German perfor-
mance on reparations; so the French wished to maintain their military presence for as
long as possible.
Thus far, nothing has been said about the League of Nations, the covenant of which
was incorporated into the Versailles Treaty and all of the other peace treaties concluded
with the defeated former Central Powers (Austria, Bulgaria, Hungary and Turkey).
The League, which admitted Germany in 1925, was the brainchild of many optimists,
pre-eminently British and American, though its founding is associated popularly with
President Wilson. The last of his ‘fourteen points’ of 8 January 191 8 insisted that ‘A
general association of nations must be formed under specific covenants for the purpose
of affording mutual guarantees of political independence and territorial integrity to great
and small states alike.’ It cannot be denied that there was a great deal of conference
diplomacy in the 1920s, some of it facilitated by the existence of the League. However,
the League did not, and could not, transform the conduct of international relations. Alas,
its fundamental premise was unsound. That premise was that the whole community of
nations, and certainly the great powers permanently on the League’s Council, would act
together to deter, and if need be resist, aggression. This is the theory of international order
by collective security. The fallacy in the theory is that states will take costly steps to resist
aggression even when their own vital interests are not at stake.
The Versailles Settlement was the inevitable product of the war. Unwisely, it offered
maximum offence to Germany while inflicting only minimal long-term damage upon it.
One of the rules of international relations holds that no post-war political order can be
102 War, peace and international relations