ite on its
own account if the German people had known that such action by
President Wilson offered good prospects of leading to a peace by
understanding. Later, when I returned from America to Germany,
I was struck by the small number of my countrymen who privately
favored the submarine war. I therefore still think that German public
opinion could easily have been persuaded to accept Mr. Wilson's
mediation, if the terrorism of the supporters of submarine war
had been dealt with in time. Herr von Bethmann-Hollweg has spoken
before the Commission of the National Assembly of the hypnotic
effect exerted on German public opinion by the submarine war.

Though the Foreign Office telegram of the 7th January mentions
the ways in which President Wilson could bring pressure to bear
on the Entente, it had already struck me at that time that the
first step taken by the United States to force the conclusion of
peace had not made the impression in Germany that its importance
warranted.

The various "War Memories" that have now been published in Germany
do not touch on this point. As has already been mentioned, the
"Federal Reserve Board," which corresponds to our Reichsbank, had
issued a warning against the raising of loans for belligerent States.
In this way the American source of funds was practically cut off.
Already foreign securities were in general unwillingly handled.
If the loans had been completely forbidden, such results would
not have transpired, as the American avails himself of bank credit
to a far greater extent than is usual in other countries. It is
well known that the Government of the United States, after they had
entered the war, themselves raised "Liberty loans," and advanced
money to their Allies because this procedure accorded much more
closely with American inclinations than the raising of foreign
loans.

As is well known, after the German peace action had failed, the
definite decision to declare unrestricted submarine war was taken in
Pless on the 9th January. In this way, as the Chancellor said, the
Rubicon was crossed. War with the United States seemed inevitable,
unless it were found possible at the eleventh hour to annul the
decision of the German Government. Herr von Bethmann-Hollweg has
declared before the Commission of the National Assembly that he had
not sufficient faith in Mr. Wilson's peace intervention to advise
the Emperor to oppose the demand of G. H. Q. for the declaration
of unrestricted s