former Ottoman Empire. The Turkish delegates had, on the whole, good reason to be pleased with what they accomplished at Lausanne, but their success was due as much to the thoroughness of their preparation and to the single-mindedness of their devotion to the principles consecrated in the National Pact as it was to the realization of the Allies that Turkish armies were ready to renew fighting at a moment's notice and that public opinion in the Allied countries would not countenance further sacrifices of men and money for the enforcement of the maximum demands made upon Turkey. At the concluding session of the Conference of Lausanne Ismet Pasha expressed his gratification at the happy issue of the negotiations, which, he said, had been "conducted on a footing of equality." The Turkish plenipotentiaries, he continued, had not failed to point out on every occasion that their country was worthy of the full and complete independence enjoyed by all civilized countries. They were going to sign the Treaty of Peace in the belief that it was based upon the recognition of the equality and independence of Turkey and they were determined to apply its provisions loyally.

With the Treaty of Peace and the other parts of the settlement duly brought into force, Turkey will now have the opportunity to make good the assurances which she gave in return for her emancipation. In view of the novelty and difficulty of the tasks with which she is confronted, especially since the proclamation of the Republic and the abolition of the Caliphate, it will probably be necessary for some time to come to judge her more by her evident intentions than by her accomplishments. During this time there will no doubt be frequent occasions for the invocation of the good offices of the Ministry of Foreign Affairs for the adjustment of difficulties arising in connection with administrative acts or judicial decisions. It is to be hoped that these occasions will steadily decrease in frequency, and that Turkey will soon succeed in proving to the satisfaction of all concerned her ability, as well as her desire, to fulfil all the obligations incumbent upon her under that régime of international law which she urged at Lausanne as the only proper basis for the regulation of her dealings with foreign Powers and their nationals.

THE LONDON CONFERENCE ON THE APPLICATION OF THE

DAWES PLAN1

BY GEORGE A. FINCH

Managing Editor

The Dawes plan for recovering the reparation debt of Germany to the Allies under the Treaty of Versailles 2 was accepted by all of the interested parties at London on August 16, 1924, and certain agreements necessary to enable the plan to be brought into operation were drawn up and initialed. Formal signatures to them were attached on August 30th after the French Parliament had approved the work of the conference on August 24th and 26th, and the laws for carrying the plan into effect had been passed by the German Reichstag on August 29th. The process of putting the plan into operation was thereupon promptly started. Immediately after the signatures had been attached on August 30th, the French Government issued instructions for the evacuation of a section of the Ruhr, and the Reparation Commission on the same day announced the appointment of the principal officials who are to administer the plan, namely, the Agent General for Reparation Payments, Mr. Owen D.Young of the United States, ad interim (the appointment of Mr. Seymour Parker Gilbert, formerly Assistant Secretary of the United States Treasury, as the permanent Agent General was announced September 4th); Trustee of the Railway Bonds, M. Delacroix of Belgium; Trustee of the Industrial Debentures, Signor Nogara of Italy; Commissioner of Controlled Revenue, Mr. Andrew McFadyean of Great Britain. Two days later, namely, on September 1st, the first instalment of twenty million (20,000,000) gold marks, due from Germany under the plan, was paid to the Agent General for Reparation Payments, and the second instalment was promptly paid ten days later. On September 4th, the restrictions placed upon the movement of persons, goods and vehicles between occupied and unoccupied Germany were removed, and four days later the eastern customs line between the same territories was abolished. On September 10th, the first of the Ruhr political prisoners were set at liberty.

Negotiations lasting exactly one month were required to reach the agreements for putting the Dawes plan into operation. The London Conference opened on July 16th and the agreements were completed and ready for 1 The official proceedings of the conference are not available at the time of writing this article. For the facts and information contained herein, use has been made of the London Times for July and August and the first half of September, especially the daily accounts of the conference published during its sessions.

? For a summary of the Dawes plan, see the article in our last issue, July, 1924, pp. 419-435.

signature on August 16th. In its organization and procedure the conference resembled in some respects the Conference at Versailles in 1919. It was divided into two stages, first, the discussions between the Allies, and secondly, the negotiations with the Germans. In the first stage, the Allied countries having a direct interest in reparation payments by Germany took part, namely, Belgium, British Empire (with the British Dominions and India represented by one delegate alternating on the panel system), France and Italy, who were represented by their Prime Ministers, Greece, Japan, Portugal, Rumania and the Serb-Croat-Slovene State, who were represented by their diplomatic envoys at London. The United States was represented by its ambassador at London, with especially limited powers, but he did not sign any of the agreements.

3

Mr. Ramsay MacDonald, the British Premier, was elected President, and Sir Maurice Hankey, Secretary-General. The program adopted was contained in a Franco-British memorandum of July 9th, and the topics on it were assigned to three committees to consider and report, respectively, upon first, the procedure of declaring Germany in default under the Dawes plan, and the measures to be taken in such event; second, a plan by which German economic and fiscal unity should be restored; third, methods of making transfers of payments and deliveries in kind from Germany to the creditor countries. A legal committee was later appointed to report upon the proper arrangements to be made with Germany for putting the Dawes report into operation without running counter to the Treaty of Versailles, and upon provisions for modifying the Dawes report, if necessary, and interpreting it after it became operative.

The work of the committees was finished and their reports approved on August 2nd, when an invitation was sent to Germany to attend the conference. The second stage began on August 5th, when the German delegation, headed by Chancellor Marx, arrived; but here the resemblance to the Versailles Conference disappeared. Mr. MacDonald informed the Germans that there was a common desire to attach signatures only after discussions in which every party had been fairly heard. He handed them copies of the committee reports previously agreed upon and invited them to submit comments in writing. After this was done, the German comments were classified and referred to the original committees of the conference, which were reconstituted with German members to deal with the German emendations. In summarizing the work of the conference at its closing session on August 16th Mr. MacDonald referred to this phase of it as follows:

3 Printed in British parliamentary paper, Misc. No. 12 (1924). For the correspondence concerning a previous program which met with vigorous opposition in France, see Misc. No. 10 (1924).

The text of the reports of the First and Third Committees is printed in the London Times, Aug. 4, 1924, p. 13. A summary of the report of the Second Committee is printed in the Times, July 29, p. 12. The text of two reports by the Committee of Jurists is printed in the Times, July 29, p. 14, and Aug. 4, p. 13.

I believe we have given Europe something better than an agreement drafted by lawyers and printed on paper-we all negotiated, discussed, put ourselves in each other's shoes. That is the greatest advance we have made, even when, in the end, one side or the other has been disappointed with the result. We are now offering the first really negotiated agreement since the war; every party here represented is morally bound to do its best to carry it out, because it is not the result of an ultimatum. We have tried to meet each other as far as the public opinion of the various countries would allow us. This agreement may be regarded as the first Peace Treaty, because we sign it with a feeling that we have turned our backs on the terrible years of war and war mentality."

The conference had to deal with numerous questions, some of an intricate technical nature involved in the practical operation of the Dawes plan, which could be and were solved by the experts on the committees, and others of an important political character which could only be decided by the heads of government in council. In the Inter-Allied stage of the conference, the question of declaring a German default in the execution of the Dawes plan was the most difficult to solve. The British Government entered the conference in its antipathetic attitude toward the Reparation Commission, and seemed determined that the commission should not be vested with the power of declaring Germany in default under the Dawes plan, which it was argued exceeded the Peace Treaty provisions in the matter of deliveries in kind. France seemed equally determined to maintain the powers vested in the Reparation Commission by the Treaty of Versailles, seeking to keep the Dawes Committee within the position which it technically occupied, namely, that of a subordinate agency appointed by the Reparation Commission.

During the second stage of the conference, the overshadowing question was the military evacuation of the Ruhr. The German delegates naturally wished this to come about as soon as possible, and suggested six months as the maximum period during which evacuation should be accomplished. The British Government, although it did not take a formal part in these negotiations, informally made the military evacuation of the Ruhr a sine que non of her signature to the London agreements, and took the ground that military evacuation should take place concurrently with the economic evacuation. The French and Belgian Governments were disinclined to give up their hold on the Ruhr until the successful working of the Dawes plan had been demonstrated, and proposed two years as the maximum time within which their military forces should be withdrawn. In this connection, the French and Belgians also proposed that a few thousand of their nationals should be retained in the employ of the railways in the Ruhr for the security of their troops in the event of a German strike, and to be used as a nucleous in case reoccupation became necessary.

London Times, August 18, 1924, p. 16.

As will be seen in the following analysis of the agreements, the main questions in dispute were compromised. The Reparation Commission retains jurisdiction of the question of German defaults, but an American is to be added when the commission is considering any point relating to the Dawes report, and the provisions of the Treaty of Versailles are amended so as to provide for appeals to an arbitral commission from decisions of the commission upon German defaults either under the Treaty or the Dawes plan. The complete military evacuation of the Ruhr within one year was promised by France and Belgium, and they gave up their demand for the retention of employees on the German railways.

The documents embodying the arrangments of the conference at London consist of a protocol stating the general results, and four annexed agreements: (I) between the Reparation Commission and the German Government, containing their respective undertakings to put the Dawes plan into effect; (II) between the Allied Governments and the German Government, concerning Agreement No. I; (III) between the Allied Governments and Germany, enumerating the various steps to be taken on either side in order to put the plan into execution; (IV) an agreement between the Allies amending Annex II to the reparation clauses of the Treaty of Versailles."

By Agreement No. I, which was signed on August 9th, the German Government undertakes to enact and enforce the laws and regulations required to carry out the recommendations of the Dawes plan, especially concerning the establishment of the bank of issue, the German railways, industrial debentures, and the control of the revenues assigned as security for the reparation annuities. On its part, the Reparation Commission agrees to take proper measures to facilitate the issue of the German loan required by the Dawes plan, and to make all financial adjustments necessary to give effect to the plan.

By Agreement No. II, the Allied Governments and Germany agree to submit to arbitration all disputes which may arise between the Reparation Commission and Germany with regard to the interpretation of Agreement No. I, the Dawes plan, or the German legislation enacted in execution of that plan. The arbitral body is to consist of three members appointed for five years, one by the Reparation Commission, one by the German Government, and the third by agreement between them, or, failing such agreement, by the President of the Permanent Court of International Justice. The agreement then deals with the functions of the Transfer Committee, and provides a system of arbitration for the settlement of disputes relating to this section of the Dawes report.

The Dawes plan provides that all reparation payments are to be deposited

The text of the protocol and agreements is printed in the London Times, Aug. 18, 1924, pp. 15-16. As soon as an official text is available, it will be printed in the SUPPLEMENT to the JOURNAL.

'The other three agreements were initialed Aug. 16th and signed Aug. 30th.