The London Agreement, based on the Dawes Report, may break down in its financial operations. I believe it will, for the reasons I have given. But those words of Herriot renouncing the romantic idea of Germany’s ruin as the fruits of victory for France promise a way of further compromise and conciliation if the burden of the London Agreement cannot be fulfilled, literally, by the German people, or if the effect of fulfilment is disastrous to other nations. The London Agreement, after all, is only the first step towards the pacification of Europe, and its greatest benefit will be its clearing the way for other steps along the road to stable conditions and general security. The first of these is the demilitarisation of Europe, a relief from the crushing costs of great standing armies, preceded by absolute guarantees to prevent the re-arming of Germany. “The central fortress of Europe,” said Herriot, “must be demolished, and the German democrats must aid us.” That was a figure of rhetoric, for at the present time the “fortress” of Germany is dismantled of great artillery and under the power of French guns. But the French Premier was holding out a new hope for the world when he promised that France would base her security upon the moral guarantee of the world powers acting through the military control of Germany by the League of Nations in a general scheme of disarmament. One other Conference and attempt at settlement will arise out of the London Agreement. That is the question of inter-allied debts, overshadowing the financial relations of the world and the cause of grave anxiety and much antagonism. At the present time Great Britain is the only country paying off her war debts. In spite of payments to the United States which are weighing heavily upon her financial health, she is not receiving a penny from France or other countries to which she lent far more than she borrowed from the United States. If Germany is able to pay substantial reparations to France, Belgium and Great Britain, it will be an easy matter of arithmetic to write off many of these debts all round. I do not think it is going to be as easy as all this, because the future of German reparations is vastly uncertain. Nevertheless it is impossible for England to demand her “pound of flesh” from France if Germany is reprieved. I think England will act more generously than she can afford for the sake of good will all round, and I hope the United States will help her to be generous.... If all that could be cleared away, Europe and the whole world would indeed be in possession of a fair field of hope in which we could sow and reap new harvests in the security of peace. There is bound to be much trouble, argument, friction, heart-burning, before that work is accomplished, yet we are moving slowly along to that endeavour, and there is a light in the sky beyond the jungle of all the undergrowth in which international relations are entangled. THE MACHINERY OF DESTRUCTION