World War One - The Illusion of U.S. Neutrality

“Our firm had never for one moment been neutral; we didn’t know how to be.” —J. P. Morgan senior partner Thomas Lamont
After urging Americans to be “neutral in thought and deed,”the Wilson Administration extended the Allies unlimited credit, cured the 1913 depression on the strength of massive European war orders, and initiated a huge anti-German military “preparedness” campaign dedicated to the proposition that compromise equaled surrender. When Germany responded with unrestricted submarine warfare to bring Britain to its knees before the U.S. could enter the war directly, Washington reacted with the exaggerated outrage of false innocence aggrieved.  Quick to denounce Berlin for inevitable American losses incurred shipping supplies through a war zone, the U.S. failed to demonstrate a similar indignation at British-imposed losses. When the British cabinet chose to disregard the 1909 Declaration of London, which would have permitted U.S. ships to dock both at German ports and neutral ports like Rotterdam and Genoa, Washington failed to protest. When the British Navy shut off American trade with the Central Powers (Germany, Austro-Hungary) by imposing a continental blockade—a violation of international law—Washington again said nothing. Then when U.S. trade with the Allies quite naturally soared, entering the war loomed as the only way to protect American investments threatened by German victory. In fact, the month Wilson declared war (April 1917), major U.S. bankers, in addition to half a million individual investors, had a stake of $2.3 billion in notes and bonds which stood to become worthless if the Allies collapsed. Several weeks earlier Ambassador Walter Hines Page had cabled the State Department from London, warning of impending economic disaster if the U.S. continued to stay out of the war: “The inquiries which I have made here...disclose an international situation which is most alarming to the financial and industrial outlook of the United States.” A danger existed, he said, that “Franco-American and Anglo-American exchange will be greatly disturbed; the inevitable consequence will be that orders by all the Allied Governments will be reduced to the lowest possible amount and that trans-Atlantic trade will practically come to an end.” Page foresaw “a panic in the United States” and found it “not improbable” that “maintaining our present preeminent trade position” would require “declaring war on Germany.” In the fiscal year 1914 American exports had exceeded imports by $436 million. Three years later war orders had raised the differential to $3.6 billion, an eight-fold increase. But most dramatic was the staggering $22.6 billion the U.S. federal government spent between its declaration of war in April 1917 and the Armistice in November 1918, an expenditure three times larger than what Washington had spent in the entire first century of its national existence combined. Never before had the U.S. economy experienced such an expansion of industry, trade, and agriculture. This extraordinary demand more than compensated for the loss of trade with the Central Powers, even taking into account losses inflicted by German submarines. With American industrial facilities growing exponentially the U.S. rapidly became a major world power and the unchallenged leader of the American hemisphere. Billions of dollars of liquidated foreign holdings helped transform the U.S. from a debtor to a creditor nation and New York became co-equal with London as the financial center of the world. Accompanying these sweeping economic and political developments were conflicts on the high seas that steadily drew the U.S. towards war. To prevent delivery of items useful to the German war effort, the British insisted on searching neutral vessels for contraband in Allied ports. This reduced American trade with the Central Powers from $169 million in 1914 to $1 million in 1916. Though the State Department made formal protests to London about the interference, it issued no ultimatum when nothing came of them. Colonel House told German Ambassador Count Johann von Bernstorff that reprisals were impossible because “American commerce was so completely tied up with the interests of the Entente.” What Congressman H. C. Peterson aptly termed the “blood soaked boom” was not to be derailed. Germany countered the British blockade with a U-boat campaign, a new weapon that delivered sudden death from the invisible ocean depths. President Wilson warned he would hold Berlin to “strict accountability” if U.S. passengers were harmed, without specifying the consequences he had in mind. The Germans took the position that they would call off the submarines only if Britain ended its blockade. Wilson and the British held that the surface blockades were legal and proper because they only affected property, whereas submarine attacks were illegal and barbarous because they cost lives. This overlooked the fact that much of the property involved in U.S.-Allied trade was munitions.In view of the British domination of the seas that brought this situation about, Washington basically had three options once war broke out. It could embargo all trade with Europe, suffering a reduction in American profits. It could convoy ships through the British blockade with men-of-war, thus maintaining its economic independence but forcing a showdown with the British that might have brought the U.S. into the war right at the start. Finally, it could foster one-sided trade with the Allies, earning fat profits but risking war with the Central Powers. This was the course chosen.For all its indignation over German “barbarism,” U.S. losses from submarine attacks were actually slight. From 1915 until Washington entered the war two years later, only one American ship, the Gulflight, suffered any deaths as a result of a German attack, while some 200 Americans died traveling on Allied ships. One-hundred-and-twenty-eight Americans perished in the Lusitania sinking in May 1915, which was a British liner carrying 4200 cases of U.S. rifle cartridges, clearly contraband of war. After Wilson demanded the Germans pledge never to attack another passenger liner, Berlin apologized and agreed to pay an indemnity.War was temporarily averted, but after the Germans caused several American deaths by torpedoing the French Sussex the following April, Wilson threatened to break off relations with Berlin unless Germany suspended unrestricted submarine warfare. Berlin reluctantly agreed, but in achieving this small triumph Wilson had effectively surrendered the initiative. As soon as Germany decided technical American neutrality was less important than the advantages of all-out submarine war, the U.S. would be forced to honor its threat. In February 1917, calculating that a full-scale U-boat campaign would bring Britain to its knees before U.S. participation in the war could prove decisive, Germany announced a resumption of submarine war against belligerent and neutral vessels alike. Feeling its national honor at stake, Washington declared war two months later.The Allied Blockade of the Central PowersThe deaths from starvation and disease resulting from the Allied blockade of the Central Powers vastly exceeded the lives lost due to German submarine attacks. By 1916 the physical effects of malnutrition stemming from the Allied naval blockade were painfully apparent. Germany was reeling from devastating illness, including tuberculosis, rickets, influenza, dysentery, scurvy, keratomalacia (ulceration of the eye), and hunger edema. An incident related by Associated Press correspondent George Schreiner makes this dramatically plain. Traveling in late 1916 on a Berlin streetcar, Schreiner encountered a woman of Central Europe’s old nobility who complained of the unaccustomed hardships of being forced to use the streetcars. Schreiner replied sympathetically that street-car travel was indeed a trial because the cars were always overcrowded. “It is not that,” responded the woman, “it is the smell.” Schreiner inquired, “Of the unwashed multitude?” She answered, “Yes! And -.” “And, madame?” “Something else,” said the woman, with some embarassment. “I take it that you refer to the odor that comes from underfed bodies,”Schreiner remarked. “Precisely,” assented the noblewoman, who proceeded to say that she first observed the odor only recently and that, “The smell was new to me.” “Remind you perhaps,” asked Schreiner, “of the faint odor of a cadaver far off?” The light of total understanding came into the woman’s eyes. “Exactly, that is it...How do you account for it?” Schreiner explained, “Malnutrition! The waste of tissue due to that is a process not wholly dissimilar to the dissolution which sets in at death.” Hunger proved especially cruel to German children, whose skeletal systems were ravaged by rickets. Their bones failed to ossify, their teeth fell out, their jawbones broke, their joints became so sore that they could only walk with great difficulty. Allied officials visiting postwar Germany found, along with rickets, rampant anemia, listlessness, poor muscular tone, sunken eyes, and emaciation. As many as 20% of children enrolling in school in the spring of 1919 were sent home as unfit. Thus, while Americans were being terrified by wartime propaganda alleging Germany was bent on world domination, the German reality was of stunted children with skinny and rickety limbs, sunken and listless eyes, and bloated stomachs—crying out to malnourished parents for nonexistent food. By war’s end the German Health Office calculated that the blockade had caused 763,000 deaths, not including 150,000 who died from Spanish influenza, but might not have had they been spared four years of increasingly severe malnutrition. One can only wonder how many survivors of this terrifying ordeal grew up to embrace Adolf Hitler’s fascist state.The Propaganda WarTo have any hope of victory Britain had to get the U.S. into the war. Convinced that intellectuals were the most gullible members of the American population, British propagandists targeted the liberal intelligentsia, establishing a War Propaganda Bureau at Wellington House that produced books and pamphlets to mold its thought. They steadfastly cultivated the perception that Berlin was a congenitally evil aggressor guilty of staggering atrocities under the leadership of the wicked Kaiser, who was described as the “Beast of Berlin.” While British and French occupations of a host of neutral countries were severely downplayed, the German invasion of Belgium was depicted as an unprecedented criminal act. Some 260,000 influential citizens, in addition to newspapers, YMCA’s, libraries, universities, and clubs, were deluged with maps, pictures, diagrams, posters, cartoons, and other war propaganda designed to wed the Americans to the Allied cause. Scores of British luminaries toured the U.S. giving lectures on the war, including Rudyard Kipling and Joseph Conrad. The propaganda blitz paid off. Working with the Committee on Public Information (The Creel Commission), liberals like Walter Lippmann and Edward Bernays took up the British cause, while the New Republic and other liberal journals argued that the U.S. was an enlightened state fighting history’s first war over principles and values rather than spoils and tribute. When the U.S. joined the war in 1917, its participation in the most awesome slaughter in human history was passed off as a selfless “war to end all wars.”To whet the appetite for German blood, promoters of Liberty loan drives flooded the country with stories of mutilated Belgian children and babies with severed hands. The fact that babies with their hands cut off would not have lived more than a few minutes without a large supply of doctors to tie off the arteries, apply dressings, and deal with shock, did not occur to the hysterics who took such reports seriously. At one point Clarence Darrow, who supported the war but became suspicious of atrocity propaganda, offered a $100 reward to anyone who could bring him one of the “mutilated Belgian children” said to be living in Chicago. He never had to pay off. An immense success, the Wilson Administration’s war crusade took the largely pacifist American people and transformed them virtually overnight into mobs of raving jingoist fanatics. Among those impressed by the new propaganda triumph was an Austrian corporal who promised that the Germans would use the new technique of public relations to mount a better propaganda showing in the next war. It was one of the few times he ever kept his word.VersaillesOnly after the war did President Wilson admit that high ideals were not behind it: “The real reason that the war we have just finished took place was that Germany was afraid her commercial rivals were going to get the better of her, and the reasons why some nations went into the war against Germany was that they thought Germany would get the commercial advantage of them. The seed of the jealousy, the seed of the deep-seated hatred was hot, successful commercial and industrial rivalry.” When the U.S. entered the war Wilson knew that the secret diplomacy he claimed to abhor had arranged for a redivision of Empires as a reward for the victorious powers. The originally secret treaties were syndicated in nine newspapers in addition to the Evening Post and were reprinted in pamphlet form in many cities by 1917. Two copies of the treaties were mailed to every Senator and Congressman and two to the White House. And in the summer of that year Lord Balfour complied with Colonel House’s request that copies of the treaties be sent to Washington so the U.S. would know what it was fighting for. So while Wilson piously declaimed his undying support for self-determination for all, the treaties and the territorial spoils they called for became the basis of the Versailles Treaty. In other words, with millions dead and Europe ruined, the Big Powers resumed arranging patent pools, cartels, trusts, and power networks, the very structures that had just drenched the continent in blood. The staggering loss of life and the legions of mutilated and maimed were forgotten in strains of dance music, a clatter of tea cups, “points” and “principles” of Eternal Peace mediated by rival empires forever at each other’s throats. Wilson had promised a “peace between equals.” But at Versailles he and the Allies imposed a harshly unjust peace, forcing the defeated Germans to humiliate themselves by admitting to sole responsibility for the war. Rational territorial settlement, disarmament, the League of Nations, and the working out of permanent peace took a back seat to age-old vengeance. The Germans, who had agreed to an armistice based on the idealism of President Wilson’s 14 Points, were quickly disabused of their illusions. While champagne flowed freely in Paris, the Allied blockade imposed starvation on millions of Central Europeans well beyond the armistice. Hunger was the weapon of choice to force the Germans to sign any peace treaty the Allies dictated. The treaty might have been even harsher than it was had it not been for the shadow of Lenin and the Bolsheviks hanging heavily over the negotiations. But with hunger, chaos, and misery reigning throughout Central Europe, Allied diplomats worried that Bolshevism might well sweep to the Rhine. In fact, Communist governments did briefly take power in Hungary and Bavaria, which seceded from the Reich for three weeks in April 1919. In a letter home liberal journalist Oswald Garrison Villard wrote that the architects of Versailles were making a mockery of democratic ideals: “It is enough to make an anarchist out of anybody to see the world in such hands. The calm way they go on carving up Europe without consulting the Russians, Germans, Austrians, Hungarians, etc., is beyond words. No one knows where it will end. The Poles and Czechoslovaks, Italians, and others have about as much idea of making this a better world and ending war as the cows in New Jersey.”Aggravating his distress were the hospitals of Dresden and Berlin, where he found “many children with the swollen limbs and bellies of famine sufferers. Children six and seven years of age were the size of normal children four or five.” The Big Four (UK, US, France, and Italy) acted on the premise that they and they alone had the right to establish the terms of peace, kill millions of Germans, rob them of their territory, steal half their coal supply and three-fourths of their iron ore, annex their colonies and seize their great steamships, meanwhile making free use of German railways and exercising unlimited and perpetual rights to dispose of German industrial production. They had the right to do all this, they felt, without suffering any threat of retaliation for their acts. Meanwhile, Germany was prepared to agree to a Peace Treaty calling for a League of Nations, cession of Alsace-Lorraine and all German colonies, surrender of the German fleet, reduction of the army to a domestic police force, demilitarization of the Rhine, and indemnities for war damages to France and Belgium. U.S. Secretary of State Robert Lansing said that such a treaty could have been drafted in 24 hours. After that, the blockades could have been terminated and normal life reestablished. But such was not to be.In May, 1919, nine attaches of the American Peace Commission resigned en masse to protest the punitive Peace Conference that emerged instead. Among them was William C. Bullitt, who stated in his resignation letter to President Wilson: “I am one of the millions who trusted implicitly in your leadership and believed you would take nothing less than ‘a permanent peace based on unselfish, unbiased justice.’ But the government has consented now to deliver the suffering peoples of the world to new oppressions, subjections, and dismemberments—a new century of war...Unjust decisions regarding Shantung, Tyrol, Thrace, Hungary, East Prussia, Danzig, and the Saar Valley and abandonment of the principle of freedom of the seas make new international conflicts certain.”Wilson could not invoke the excuse that he was working within constraints, for he had the whip hand. In France, he had the freshest, best-equipped, and the only expanding army. He had all the money left in the world and control over a majority of the world’s food supply. Without his approval the Allies were helpless. Had he threatened to negotiate a separate treaty with Germany and withdraw the U.S. Army without loaning Europe a penny more, there is little the Allied leaders could have done but concede to any peace terms Wilson felt were appropriate.
For a compilation of the disaster, see below.




1914: Washington “Neutrality”A Serbian hit man guns down the Austrian archduke in Sarajevo, plunging "civilized" Europe into total war.The day the disaster headlines leap off American breakfast tables the British Navy hauls up the German cables and cuts them. The next day the U.S. press lacks even a single Berlin or Vienna date-line. The American people are to learn nothing of the Central Powers’ views of the war for over a year, and will not be told that President Wilson has a similar outlook until after the bloody cataclysm is all over. British censors, aspiring to control the thought of the entire world, prudently identify intellectuals as the most gullible sector of the population and target propaganda at the American intelligentsia. At the same time, U.S. correspondents are denied access to the Allied front, forcing leading U.S. papers to rely on the British press. The starvation imposed on the Central Powers by the British Naval blockade is deemed unfit for American ears.The U.S. Legation at Brussels hears little more than fevered tales of German savagery running amok, of nuns raped, and women, children, and old men coldly shot. These stories are swallowed whole and dutifully transmitted to the American public.President Wilson urges Americans to be “impartial in thought as well as in action,” but stigmatizes German-American immigrants as “hyphenated-Americans,” a thinly veiled euphemism for Kaiser loyalists. Immigrants favoring the Allies he praises as “patriotic.”In discussions with an officer of the National City Bank, Assistant Secretary of State Robert Lansing learns of Wall Street’s need to extend short-term credits to European governments so they can buy U.S. supplies. Lansing wins Wilson’s agreement to “look the other way” at credit accommodations facilitating the Anglo-French war effort. Thus is the president’s policy calling for a “true spirit of neutrality”replaced by the more expedient “strict legality.” While Germany is shut out of the U.S. arms market, American munition stocks boom on the strength of Allied war orders. The blood of German youth lifts the U.S. out of recession.
1914: Washington Germans 100% Evil, Allies 100% InnocentThe fact that European states emerged from centuries of slaughter is quickly dismissed as a relevant context for interpreting the present war. Prussian militarism and the undemocratic intrigues of the autocracies of Central Europe are assigned all the blame. The U.S. press frames the issue as a wanton Austrian attack on “little Serbia,” and when Germany does not restrain Serbia the air is rife with accusations that the Kaiser has forced war on peace-loving nations. The New York Times boldly calls for “the crushing out of the imperial idea, the end, once for all time, in those three empires [Turkey, Austria-Hungary, Germany] of the absolute rule and the substitution for all powerful sovereigns and their titled advisers of an executive with power to carry out only the will of the people.” The Times’ editors say nothing of the Allies’ blood-soaked imperial idea, represented by the Czar and the Anglo-French alliance.The American labor movement remains skeptical of this call from on high for Europe’s working-classes to exterminate each other with weapons produced by modern industry.
1914: Paris Hun Atrocities Fictitious, U.S. Reporters Say“In spirit fairness we unite in declaring German atrocities groundless as far as we were able to observe. After spending two weeks with German army accompanying troops upward hundred miles we unable report single instance unprovoked reprisal. Also unable confirm rumors mistreatment prisoners or non-combatants.... Numerous investigated rumors proved groundless... Discipline German soldiers excellent as observed. No drunkenness. To truth these statements we pledge professional personal word.”—U.S. correspondents permitted by the Germans to tour the Belgian front, cable to Associated Press, September 1914



1915: New York City The New York Times Hails Peaceful War Trade “The promise of the new year is that we shall accomplish a peaceful penetration of the world’s markets to an extent we have never dreamed of. What others have shed blood to obtain through politics and force we shall attain while bestowing our benevolence...It is a new translation of the old beatitude, revised: ‘Blessed are the keepers of the peace for prosperity shall be within their homes and palaces.’”