Many of the Allies are hoodwinked by the ‘great illusion’ which even now prevents them, to their endless detriment, from seeing things as they actually are. In the Allied nations, in fact, people continue to speak of Germany, Austria-Hungary, Bulgaria and Turkey, as if these states remained just as they were before the war. But these terms have no longer any relation to reality. The Quadruple Alliance of Central Europe is simply a great illusion, studiously fostered by William II, for by its means his plans are vastly facilitated. As a matter of fact, Turkey, Bulgaria, and Austria-Hungary are not the allies, but the vassals, of Berlin, and their influence with her is less than that of Saxony or Bavaria. The rulers at Constantinople, Sofia, Vienna, and Budapest are simply marionettes moved by threads which are pulled by Berlin according to her strategic needs. Very often we hear it said, ‘Germany has created _Mitteleuropa_.’ This is another mistake. Geographically speaking, _Mitteleuropa_ includes only Central Europe; and Germany’s dominion is infinitely further flung, extending as it does from the west front in France to the British front before Bagdad. If we wish to see things in the light of reality, we must say, for the present at least, ‘_There is no longer any Germany; instead, there is Pan-Germany_.’ This is an essential assumption if we are to reason justly. The map of Pan-Germany at the beginning of 1917, which is printed above, shows clearly the essential, but all-too-little-known elements of the present situation, which is characterized by the fact that 73 million Germans, aided by 21 million vassals,—Magyars, Slavs, and Turks,—have reduced to slavery 82 millions of Latins, Slavs, and Semites, belonging to thirteen different nationalities. Pan-Germany, which has now almost completely reached the limits set by the Pan-German plan of 1911, consists, therefore, of one vast territory containing about 176 million inhabitants and natural resources of the greatest variety. I beg my readers to refer to this map of Pan-Germany every time it is made desirable by the text. This repeated study of the map is indispensable to a clear and complete comprehension of the demonstration which follows. As regards the profits which Germany has wrung from the war, it is particularly important, in order to grasp the idea of Pan-Germany; for it is the direct result of its creation that Germany, in spite of the losses and expenses inevitably incurred by a warring nation, has been able to assure herself of certain advantages which, considered as a whole, far outbalance her losses and expenses, as we shall see. In order to understand the nature of these advantages, one point must first be made clear. _The war has cost the Germans comparatively little_ For six fundamental reasons, the conduct of the war has really cost the Germans far less than it has cost their adversaries.