Page 3634


four million men under arms, though

only about a million and a half had yet

been sent to any theater of war. Of the

two, Germany had undoubtedly suffered

infinitely more from the war, both in men

and in finances. Business was not exactly

"as usual" in Great Britain, but she was

doing much more business than all of her

enemies combined. The population of British blood throughout her far-flung Empire

was about equal to that of Germany. Her

losses in killed, wounded, and captured

had been about seven hundred thousand;

those of Germany fully three millions,

possibly four millions. Supporters of the

Allies asked, "By the time that Great

Britain has lost as many men as Germany

has already lost, where will Germany be?"

Nor, in considering the probable outcome

of the war, should sight be lost of the other

Allies. Italy, France, and Russia were

undoubtedly much more powerful than

Austria-Hungary, Bulgaria, and Turkey,

and would continue to distract and diminish

much of the German strength.

In the opinion of the Allies and of

many neutral observers, victory, in the

event of a fight to a finish, could come to

the Central Powers only as a result of some

unexpected development or lucky chance.

In their view the territory conquered by

those powers in Europe did not bulk large,

for it could be lost as a result of a few

defeats, and they expected that the time

would come when the depleted ranks of

the Central Armies would prove unequal

to the task of holding their immensely

extended battle lines in the east and


Still, the entrance of Bulgaria into

the war in the autumn of 1915 had

upset all calculations for the time being, and no one could say certainly

what other developments of this or

some other sort might be in store.

The first submarine campaign had

been defeated, but a new one was

under way, and until Great Britain

knew that she could meet the submarine menace, she could not be safe.

Financially the Central Powers

were undoubtedly suffering much

more than were their chief antagonists. Their direct expenditures on the

war were somewhat less, but they

were cut off from the rest of the

world by a blockade, with enormous

resultant losses as a consequence.

Neither of the Central Powers had

been on a gold basis since the beginning of hostilities, and, though the

Germans had shown much resourcefulness in financing the war, the German mark had depreciated in other

countries more than thirty per cent. Translated into more concrete terms, this meant

that in a neutral country an investor who

had bought a German bond at or near par

would, if he converted 'it into cash, lose

about a third of his investment. Austria-Hungary's credit was at an even lower ebb,

while Turkey had been virtually bankrupt

even at the outbreak of the war and had

been sustained only by German loans.

Exchange on the Entente Powers had

also fallen, but to a lesser degree. Great

Britain, the financial bulwark of the