Note 49 — Chapter III

I have allowed nothing so far for the costs of the Armies of Occupation, which, under the letter of the Treaty, Germany is under obligation to pay in addition to the sums due for Reparation proper. As these charges rank in priority ahead of Reparation, and as the London Agreement does not deal with them, I think Germany is liable to be called on to pay these as they accrue in addition to the annuities fixed in the London Settlement. But I am doubtful whether the Allies intend in fact to demand this. Hitherto the expense of the Armies has been so great as to absorb virtually the whole of the receipts (see Excursus V. below), having amounted by the middle of 1921 to about $1,000,000,000. In any case, it is now time that the agreement, signed at Paris in 1919 by Clemenceau, Lloyd George, and Wilson, should be brought into force, to the effect that the sum payable annually by Germany to cover the cost of occupation shall be limited to 240 million gold marks as soon as the Allies “are convinced that the conditions of disarmament by Germany are being satisfactorily fulfilled.” If we assume that this reduced figure is brought into force, as it ought to be, the total burden on Germany for Separation and Occupation comes, on the assumption of the lower figure for exports, to 3.8 milliard gold marks, that is, to 76 milliard paper marks.