Now the principle ‘no indemnities’ would keep Serbia in this terrible and irremediable state of misery. It is evident that under these conditions the Serbian state would be hopelessly crippled. If, therefore, Austria-Germany were to say to the Allies, ‘Very well; in conformity with the formula “no annexations, no indemnities,” we are willing to recognize Serbia’s dependence by treaty,’ who would be deceived by this sinister and portentous joke? Who could believe in the sincerity of a proposition which, on the face of it, is rendered impossible of fulfillment by the ‘no indemnities’ clause. And what guaranty would the Allies hold that Germany, Austria, and Bulgaria would withdraw from Serbia at the same time, in view of the fact that such a withdrawal, if _bona fide_, would imply Berlin’s renunciation of the whole Central Pan-German scheme and its vast attendant profits? To suppose such a thing possible implies a complete ignorance of the Germanic spirit as it has manifested itself since the beginning of history. Besides, declarations made by the Germans themselves show that they will never recede from their position as regards Serbia. As early as December, 1916, the _Frankfurter Zeitung_ prepared its readers in advance for the ‘pacifist’ tactics about to be employed—tactics which are now being tried out with the help of the Russian anarchists, the Kienthal Socialists, and the Pope. ‘Certainly,’ said the Frankfort paper, ‘if we are to make a lasting profit from the military situation, both in its favorable and in its less advantageous aspects, it is essential that special questions should be severally considered in their relation to the whole. To-day our point of view should be as follows: in the East, the formulation of definite demands, and in the West, negotiations on a flexible basis. This is not a programme but a general line of action. “Negotiation” is by no means a synonym for “renunciation.”’ This last sentence should be read and pondered over by all the Allies. Here we find an absolutely clear statement as regards the fate of Serbia, whose restoration, by means indicated later, is the one thing which can save the world from the consequences of the Hamburg-Persian Gulf scheme. On August 8, 1917, at a banquet given at London for M. Pachitch, the Serbian Premier, Mr. Lloyd George acknowledged in decisive terms Great Britain’s obligations to Serbia—obligations which are practically those of the whole Entente.