In the national region it stultifies its own objects most effectively. Now nationalist idealism, though existing in Germany to-day only among the conservative gentry and a small section of upper-class progressives, is not a negligible quantity. For nationalism has control of the whole Coalition Government, the whole Press, with the exception of a few opposition Labour papers, and the whole of the Frei-Corps and the armed police. Owing to our continuation of a state of war after the armistice, the German Government has, by a logical process it would take too long to trace, become purely nationalist, instead of mainly socialist and internationalist. More than that, it has come into collision with Socialism and the German Revolution in its efforts to maintain a _régime_ such as we would recognise. The nationalist forces, that it relies on to maintain parliamentary party government and the supremacy of the propertied class to the exclusion both of Council Government and of a possible supremacy of the proletariat, were, in the first place, the more liberal bureaucracy and the officers, and in the second place the "Frei-Corps." But as pointed out already the Treaty we imposed on Germany forced out of the Government all the better elements of the bureaucratic and bourgeois classes. While the "Frei-Corps" with which the Government now holds all the principal towns under military rule have as moral ideals patriotism, privilege and property, and as material inducements high pay and quadruple rations. They embody not only the survivors of the officer caste, but also the young burghers and students, hitherto the Young Guard of revolution. Their formation was due partly to our delusion that a professional army is necessarily democratic because we have one, and that a short service militia is necessarily militarist because Germany used that method for its recovery a century ago; and partly to a reaction against the revolution in Germany itself. By now they have become the foundation of the present parliamentary _régime_. But the Treaty requires their reduction from over 400,000 to a quarter of that number, while it utterly discredits the nationalist Government by imposing on it humiliations such as no modern nation has ever yet undergone. Therefore, while our policy requires the maintenance of the present German parliamentarians and their police as the only possible native agents for the realisation of our economic exploitation of Germany, our procedure renders their retention of power materially and morally impossible. As I myself think that the economic policy is as shortsighted as it is wrongheaded, I do not regret that the territorial and military provisions will, unless materially modified, prevent any possibility of realising any part of it. That they will shortly revive racial and religious frontier wars in which we shall probably be involved is a minor matter. Better we should lose more men