Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1917-10-24

WHAT PRUSSIA
DID WHEN She
LICKED FRANCE

IEL
German War Fine of 1871
Likely to Rise up and
Curse Kaiser.
The war fine laid upon France ~
her %conquerer in the Franco.PruRian
war, the effect which Bismarck In
tended, and the actual effect of It
upon France and upon her conquer
or. are matters Of keen intAsest In
the study of h present war and in
"a forecast Of its financial results.
The Treaty Of Frankfort, May 10.
1871, laid q war indemnity upon
payable in gold and silver coin-an
amount equal to n billion dollars
OF American money. This was to be
paid in four instalments-a half bill
lion francs in cash; a billion and .
half during the frst year: a half bill
lion the second year, and three billion
March 2, 1874. The terms we're
rigid and without grace, except that
the last three milliards might be paid
during the year 1873. IL the French
Government should SO elect. The
total payment. including individual
fines on Paris and other large French
cities, together with interest, amount
ed when the last payment was made,
France had done with the hateful
debt six months ahead of the contract
time.
Germany's confessed purpose in
imposing this Unprecedented and
staggering indemnity, was on he one
hand to deal French industries and
commerce a mortal blow: and on the
expenses. In the latter respect she
served herself with a lavish hand.
for Germany's war expenses were but
a half billion dollars. On the other
hand, Frances war expenses, includ-
ing the fine. amounted to three bill
lion dollars. Thus Germany netted
a half billion by the transaction. But
France was forced to add 100000
900 annually to her taxes. =
Bismarck made two wide miscal-
c%ulations. He underestimate the
length of the French stocking: and
he mistook h effect on Frances for
tunes of h shifting of a billion Of
gold and silver from French to Ger
man Golfers
The French were then as now q
frugal people. When the French
Government called On the banks Of
France for a loan to pay the frst in
stalment. the n a half billion
francs was subscribed in a single
day. The second loan. in July, 1872.
was covered twelve times over. Ave
times by French and seven times by
foreign subscriptions. The actual
deposits received with the applica-
tons, amounted TO twice as much as
the loan itself. The third loan was
as quickly taken. n the entire in
debtedness was finally absorbed by
the French people themselves.
her industries were not materially
hurt.
Nor was France drained of her
coin. In the whole transaction but
ffty-five million dollars worth Of
French coin ever left France for
Germany; and but two hundred mil
lions Of coin Of any kind went to the
Such a shifting Of coin as Bismarck
contemplated became a matter Of
worldwide concern; and to check
mate it, the Bank Of England and
banks of other nations lent aid
through the adjustment Of accounts
with Germany.
The billion and odd dollars. mulct-
ed from France, Germany proceeded
to divide between the Imperial Gov
eminent and the several German
States. Six millions went to the erec-
ton of the buildings now occupied
by the Reichstag; state railways were
extended and equipped; war losses
were repaired and new fortresses
built along the readjusted Western
fEentieEii -peHsieH-fHH were pfev4d-
ed; sundry civil expenses were paid;
and the balance of thirty million dol
lars was informed in the Fortress Of
Spandau. where the original coin
still lay at the breaking out Of the
present war.
That Germany gained a adyant-
age over France by this war tributs
is not to be denied. But the advan-
tage was small, compared with the
German expectations. Following the
war, in Germany there was much
free capital. In France there was
little. She had lost as well two Of
her manufacturing provinces with
ton. and had become the heaviest
debtor nation Of the world.
But the decade, 1S70-lSs0, was a
great recuperative period for France.
After the boom Of 1872. it was a
period Of great depression for Ger
many. In this depression, it is true.
all Northern Europe and the two
can be easily traced; while Trance.
Italy and Spain escaped with small
scars, chiefly because the opening Of
the Suez Canal brought increased
trade to h Mediterranean States.
But Frances foreign trade grew
rapidly and steadily. She became the
greatest creditor nation in the world.
until her income from foreign invest
ments alone amounted at the begin
ming Of the present war to more than
four hundred million dollars annual
". Her heavy debt. which was held
at home, was not felt a. a national
burden. but rather afforded machin-
cry for adjusting profits among her
people: France was purppsely pay
ing of her debt by slow degrees.
The stocking Of France. which
prior to 1870 held savings accounts.
was now holding government bonds
as we'll.
Among the truths brought clearly
out by the growth of France after
1870 are these: The rape OF ana
tion's savings IL not a mortal blow to
its power to create: the possibility of
rapid rep~air-after val depends on the
extent to which the population has
been decimateds the chief asset of a
nation is its labor or its ability to
produce: and the cos OF war ~ large-
ly the privation Of the people wac
carry it on.
And an added fact made clear Is
that; what ID one nAtion'st disaster fs
| %hA -NrlAsh N3aa~<Ar - The panASe If