The World Remade

by G. J. Meyer

  Less than a week after Bryan’s resignation, Wilson sent the Germans his second post-Lusitania note, the one Bryan had said he could not sign. It was his own handiwork, as usual, picked out on his little typewriter, then revised and revised again. In its finished form it was at least as strong as the versions Bryan had seen, but its language remained broad and abstract. It declared in now-familiar Wilsonian terms that what the United States was demanding was not “mere rights of property or privilege of commerce”—heaven forfend that the president should stoop to such commonplace matters—but “nothing less sacred than the rights of humanity.” Wilson did like that word sacred. The Germans, already uncertain about their own policy and still struggling to come up with a conclusive response to the first Lusitania note, must have scratched their heads.

  When they finally responded, after weeks of hesitation, the Germans reiterated their defense of the U-boat campaign as a legitimate response to the starvation blockade. They also repeated their complaint that Britain, by arming her merchant ships and instructing them to fire on or ram any U-boats they sighted, had turned them into ships of war. They pronounced themselves “unable to admit that American citizens can protect an enemy ship through the mere fact of their presence on board.” As before, these were defensible positions under the law. Berlin offered to work with the United States on an arrangement—such a thing would have been easy enough—to allow American citizens to pass through the war zone in safety.

  Wilson would have none of it. He saw the Germans as defiant. A third note informed Berlin that the United States “regrets to state that it has found [the German position] unsatisfactory because of its failure to meet the real difference between the two Governments and to apply to them the principles of law and humanity involved in the present controversy.” It stated that British policies and practices had no bearing on the dispute between Germany and the United States, and again accused Germany of trampling on “the accepted principles of law and humanity.”

  In Washington if not in the United States at large, war fever was soon rising once again. It got a bizarre boost when a German commercial attaché, Heinrich Albert, dozed off while riding the Sixth Avenue elevated train in Manhattan, awoke to find the train at his stop and, in hurrying to get off, left his briefcase behind. When he turned back to retrieve it, he was told that another passenger had grabbed it and fled. Albert gave chase, but the culprit escaped. The thief was—this long remained secret—one of the federal agents assigned to follow members of the German diplomatic staff and tap their phones. (Nothing of the kind was being done to representatives of Britain and France, though the British were intercepting and decoding American transatlantic cables.)

  There was disappointment at Treasury when no evidence of sabotage or other criminal activity was found among Albert’s papers. By this time it was widely believed, even in senior official circles, that German secret agents were everywhere, that the German-American population had organized a secret reserve army sworn to rise up in service of the kaiser if the United States entered the war, and that plans were in place for the disruption of the American army by violent means. Shadowy German saboteurs were blamed every time an explosion or fire occurred at a munitions factory.

  Such stories were by no means without a kernel of truth. Not only were diplomats and other Germans stationed in the United States active in gathering information about what was happening there and why—they would have been derelict in failing to do so, so long as they stayed within the law—but there were proven instances of attempted sabotage. At the center of the plot-hatching, such as it was, were German military attaché Franz von Papen (later notorious as Adolf Hitler’s first vice-chancellor) and naval attaché Karl Boy-Ed. In December 1915 the two would be expelled from the United States for sending agents to blow up a bridge and a canal in Canada—which was of course at war with Germany. Both attempts were as unsuccessful as they were amateurish. Ambassador Bernstorff was also suspected of involvement but to his immense relief was not required to go home.

  Decades later, having survived another world war and been acquitted of war crimes at Nuremberg, Papen would observe of his time in Washington that “I am supposed to have organized a widespread net of saboteurs, to have instigated strikes in the docks and munitions factories, to have employed squads of dynamiters, and to have been the master spy at the head of a veritable army corps of secret agents.” He added that “the reputation I acquired in those days was deliberately fostered by the well-organized Allied propaganda services as part of their campaign to arouse emotions in the United States.”

  The extent of whatever sabotage program the German authorities were operating in the United States should be the subject of its own book; the fact that it has been so rarely examined in depth is probably a function of the elusiveness of the truth even after a century. Two particularly dramatic examples are the explosions that obliterated a large munitions depot on Black Tom Island in New York Harbor in 1916 and a Canadian-owned shell-manufacturing facility in New Jersey’s Meadowlands in March 1917. Investigations of and litigation over both incidents went on for decades. A claims commission ruled in 1939 that the German government had been responsible for the Black Tom disaster, which killed seven people and injured hundreds, but evidence was found to implicate members of Ireland’s Sinn Fein and an East Indian separatist movement as well. Not until 1950 did West Germany agree to pay $50 million in damages, which it finally paid two decades later. The Meadowlands incident (known when it happened as the Kingsland explosion), in which flames of unknown origin detonated half a million three-inch artillery shells and produced a four-hour fireworks extravaganza within sight of Manhattan, ended even more ambiguously. In 1931 a commission found that the German government had not been involved, but the case dragged on until finally, in 1950, West Germany agreed to pay $50 million without admitting guilt.

  Herr Albert’s briefcase did contain evidence of a variety of bizarre and sometimes ridiculous activities: buying up both munitions and the machines needed by American manufacturers of munitions in an attempt to slow the flow to the Entente, operating munitions factories in the United States to consume raw materials, paying wages so high that workers at other factories would threaten to strike if not given raises, and buying a New York newspaper in hope of getting a German view of the news past the Entente’s censors. All of this, when it became known, was seized upon as fresh evidence of German skullduggery. When Secretary McAdoo handed the materials over to the New York World, he did so on condition that their source not be disclosed. Concealment was crucial because of the awkward fact that the materials had been stolen by an agent of the U.S. government from an agent of a government with which America was not at war.

  Two days after Dr. Albert lost his briefcase, the complexity of the legal and ethical questions raised by new kinds of naval warfare was thrown into grotesque relief by an incident that occurred just west of the British mainland. A German submarine, the U-27, intercepted a British freighter. After a boarding party established that the freighter was en route to England with a cargo of munitions and mules, her crew was ordered to take to the lifeboats. The U-27 was beginning to shell the abandoned ship—a common practice, intended to save torpedoes—when another merchantman came over the horizon. She was flying the flag of the United States, and as she approached, she sent up pennants signaling her captain’s intention to rescue the men in the lifeboats. The U-27 paused in her shelling but, seeing no cause for alarm, neither submerged nor withdrew. But upon drawing near, the new arrival lowered the Stars and Stripes, hoisted the white St. George flag of the Royal Navy, and uncovered deck guns with which she quickly sank the submarine. She was not a freighter at all but the Baralong, one of the Royal Navy’s recently introduced Q-ships (the Q stood for their home port of Queenstown, in Ireland), heavily armed vessels outfitted with false superstructures that made them appear to be merchantmen. Twelve members of the U-27’s crew did not go down with her but swam to the abandoned freighter. Marines were sent
from the Baralong to kill them, which they did with brisk efficiency. First Lord of the Admiralty Winston Churchill had given orders that U-boat sailors could be executed on the spot, because they were not prisoners of war but criminals.

  When the Baralong returned to port, the British authorities asked the men in the lifeboats not to tell what they had witnessed. Instead they were to corroborate a concocted story about how the twelve German seamen had died of wounds inflicted during the sinking of the U-27, not later, in cold blood. Certain Americans among them refused to comply, and the story got out. A German demand that the captain of the Baralong be court-martialed was dismissed in London with scorn. Wilson, learning of the incident, described it as “horrible.” His view of the overall situation, however, was unaffected.

  He did react strongly when, on August 19, the British liner Arabic was torpedoed off the coast of Ireland, with two Americans among the forty-odd who perished. The commander of the responsible U-boat would later claim to have mistaken the Arabic for a freighter; such excuses were common and impossible to prove and made no difference in London or Washington. Ambassador Gerard delivered President Wilson’s protest to German foreign minister Jagow and was surprised to be told that the Arabic sinking “was done contrary to instructions if the boat had been torpedoed as reported.” What instructions? Gerard asked. He, and through him the White House, then learned of the secret order of June 5, the one forbidding attacks on Entente passenger liners.

  The revelation lowered the temperature in Washington but probably had little to do with the president’s rejection of Colonel House’s renewed suggestion that Germany must accept either the rules set by the United States or a severing of relations. Again the colonel was out of step, pushing for a showdown that Wilson did not want and putting a strain on their relationship by doing so. When he sensed a new coolness in Wilson’s communications, he again dialed down his belligerence and reverted to a position that at least resembled neutrality. It would become clear, however, that the president was growing wary. He no longer trusted House as unreservedly as he had in earlier years.

  It would hardly be surprising if Berlin found it difficult to understand the American government’s fury over the unintended loss of two lives so soon after the Baralong massacre passed without complaint. Ambassador Bernstorff, in a conversation with House, had recently observed that “you know well enough that nobody in Germany believes in the impartiality of the American Government.” In the end, however, the Germans bowed to Washington’s demands. First they issued a public pledge not to sink the passenger liners even of the Entente, whatever their size. Then, again publicly, they acknowledged that the Arabic had been sunk in violation of German government policy. This was welcomed in Washington as a step, if too small a step, toward getting Germany to admit that its entire U-boat campaign was as indefensible as Wilson claimed. Such an admission, if one could be extracted, would make it extremely difficult for submarine operations to continue. The sense of crisis subsided, and again both House and the British felt thwarted. London could bask, however, in the knowledge that the U.S. government was consistently acting in its favor. And House continued to press Wilson as hard as he dared. “For the first time in the history of the world,” he wrote to the president, “a great nation has run amuck, and it is not certain that it is not part of our duty to put forth a restraining hand.” Evidently he thought the double negative a way of being subtle.

  Sir Edward Grey’s frustration drove him to send House a letter that must have taken the colonel by surprise. In Britain, he wrote, there was “disappointment that the feeling in America is not more combative.” But he for one would be “content,” he added, if two things could be made to happen. First, the United States must recognize that peace would remain impossible until “the cause of Belgium” has been settled satisfactorily—which meant that there must be no possibility of Germany remaining in possession of Belgium when the war ended. Second, once Belgium was put right, the United States must show “no concern with the territorial changes between the belligerents themselves, who must settle things of that kind by themselves.”

  The point about Belgium was predictable and entirely legitimate; Britain had long regarded the autonomy of Belgium as essential to her own security. But Grey’s second point was so presumptuous as to make one wonder how a man usually so cool and self-contained could have allowed himself to make it. He already had House’s private assurance that the United States would never allow the Entente to lose the war, and he had been encouraged to believe further that the United States was prepared to help secure an Entente victory. But even this was not enough to put his mind at rest. Now he was insisting that the United States, even if she ultimately made victory possible, must stand aside and not interfere when a victorious Entente redrew the maps of Europe and the world. This put House in a delicate position. Grey was asking for something that Wilson would never accept—a postwar settlement in which the United States would play no part aside from making certain that the Germans gave up Belgium. He was in effect demanding the one thing that, if the president learned of it, was most likely to cause him to turn his back on Britain and her allies.

  House had grounds for taking offense, and perhaps he should have done so. But he had no wish to jeopardize his good relations with Grey and the Foreign Office. Grey’s letter left him, however, with a formidable challenge. He was going to have to find a way to induce Grey to drop this particular demand while keeping Wilson ignorant of what the demand was.

  Money, meanwhile, was becoming an increasingly challenging issue. The departure of Bryan had cleared the way for a reconsideration of the ban on loans to the Entente, and by the end of the summer of 1915 there were powerful commercial and political reasons for doing so. After a year of total war, Britain and France were in financial straits, their costs rising dizzily with no end in sight. This portended trouble not only for the Entente but for the United States, where transatlantic sales had ignited an economic boom of unprecedented magnitude. The White House, with a presidential election little more than a year in the future, had reason to fear that an abrupt drop in those sales could cause a crash. Such concerns weighed heavily on the cabinet, especially after the Morgan bank, in its capacity as Britain’s and France’s agent, began sounding the alarm. Soon Treasury Secretary McAdoo was telling his father-in-law the president that “to maintain our prosperity, we must finance it.” Lansing warned of the “industrial depression” that would follow if the Entente nations became incapable of placing new orders.

  Before becoming secretary of state, Lansing had been asked whether loans by a neutral America to either of the belligerent sides would be lawful. He had replied, regretfully, that probably they would not. But he offered a solution: in place of loans, “credits” could be issued. It was a distinction without a difference, and it cleared the way for Morgan to give France a quick and desperately needed infusion of $50 million. It was the largest loan in the history of Wall Street up to that time, but it would be dwarfed by the billions that would be lent over the next three years. Bryan, still secretary of state at this point but conscious of having already made a nuisance of himself over the blockade, quietly acquiesced.

  Late in the summer, with Bryan gone, Morgan and Company invited an Anglo-French joint high commission to Wall Street to discuss more substantial sums. This resulted in a September agreement to issue $500 million of British and French bonds in the United States. The offering did not go well; weeks after going on the market, $162 million of the bonds remained unsold. Sales to the public were particularly disappointing. Morgan and Company managed to get all the bonds placed by the end of 1915, but further offerings of the same kind were obviously out of the question. The main problem had been that the bonds were unsecured—not backed with collateral. To get future loans, the Entente nations were going to have to put hard assets behind them. Thus began the process by which the war would cause a massive transfer of wealth from Europe to the United States.

  In the same week tha
t Colonel House received Grey’s presumptuous letter, he made a remarkable entry in his diary. In the midst of a discussion of how the United States might mediate an end to the war, he wrote, Wilson had disclosed something stunningly new. He told the colonel that “he had never been sure that we ought not to take part in the conflict.” House must have been delighted, though his record of the conversation is restrained. Clearly the president’s position was shifting, and in potentially momentous ways. Which side he would want to join was too obvious to require statement.

  Not long after this revelation, on October 17, House sent what he would call one of the most important letters he ever wrote. He invited Grey, and through him Britain and the Entente, to inform Washington when the time had become right for the United States to call for peace talks. The unmistakable suggestion was that this should happen when the Entente was winning the war and could negotiate from a position of strength or, alternatively, when it was doing so badly that a halt had to be called. Then would come the tricky part: the Americans would issue a summons to negotiations, announcing that the aim was not only an end to hostilities but “universal disarmament.” If the Germans refused to participate, the United States would have a basis for entering the conflict and making it—House used these words—“a war to end war.” If the Germans agreed, nobody would be under any obligation to make the negotiations pleasant for them.

  Once again House was emerging from his shell of feigned neutrality. He was being both extraordinarily bold and extraordinarily duplicitous. This new scheme of his, which historians have labeled his “positive policy,” was intended not just to lead to an acceptable end to the war (acceptable, that is, to London) but to do so by trapping Germany between the Scylla of American intervention in the war and the Charybdis of a peace conference controlled by her enemies and their friends. It rose out of his belief that the United States, as he would tell Wilson, “had lost our opportunity to break with Germany, and it looked as if she had a better chance than ever of winning, and if she did our turn would come next.” The whole scheme was fundamentally dishonest—erected on a foundation of intentional deceit. It pointed explicitly to the possibility of taking the United States to war through trickery. The most admiring of Wilson scholars have always been inclined to absolve the president of responsibility for this. They say that he was in effect betrayed by House, who concealed from Wilson the devious things he was doing.