Contemporary Germany-A Note.

T is by no means an easy task to attempt to summarize one's personal impressions of the new Germany within the compass of a very few pages. It is obvious that great changes must have taken place since, and owing to, the War. But one can scarcely realize the extent and the profundity of these changes until one has actually revisited the country and lived with the people again, and read their papers and attempted to peep with them out from behind the barriers erected by the Versailles Treaty, which has made the world for them a place over which the words 'Verbotener Eingang' stand out very clearly and with a very real and acute significance. It is not, merely, that the uniforms have disappeared and that the streets no longer re-echo to the tread of marching men; it is not that the gorgeous trappings of monarchy and the gaudy paraphernalia of Kaiserism have been relegated to the scrap heap for ever—the change is more profound than this. It is a deep psychological change that has taken place in the people of Germany themselves—a change that is so striking that it is almost startling. Their subdued manner and habit of talk is so different from the aggressive and confident bearing of pre-war days, that one finds oneself constantly asking: 'Can this really be the Germany I used to know, the Germany of boisterous youth and universal vision, of buoyant aspiration and comprehensive Imperialism-or was that, too, a figment of my own imagination-another delusion of my salad days?"

At the present moment, the political and the economic situation in Germany is difficult and unsatisfactory. The hoped-for unity after the death of Dr. Rathenau has not materialized. The Socialists disapprove of the suggested measures to safeguard the Republic as not drastic enough, while the bourgeois parties would seek to conciliate the Right and the Bavarians. The Centre and the Democratic party resent the idea of governmental co-operation with the Independent Socialists, who refuse to have any dealings with the Industrials. Comparatively little change has been effected in

the German political mentality as a result of the Revolution. The old parties remain substantially the same. The Catholic Centrum holds the balance between the Liberal-Conservative parties on the Right and the Socialists or Revolutionary parties on the Left. These parties are run by the same caucus, they subsidize the same newspapers, and it is out of the clash and contention of party intrigue that the Chancellor has to form his working majority. Class feuds and conflicting class interests, inter-state rivalries and jealousies, communistic and religious propaganda, monarchistic and reactionary activities increase the difficulties and complexities of political life in the Reich, and render the German Government the weakest in Europe the Polish alone excepted. The Bavarian Landtag, the parliament of Brunswick, the government of Saxony, jealous of their individual rights, have to be cajoled and flattered into accepting the legislative measures of the Reichstag. The death of Dr. Rathenau checked the political movement towards the Right, and the Republic, despite its sore financial plight, is at the moment stronger, perhaps, than ever. But there is a strong feeling in the air that the present system is merely a temporary expedient, and that out of the immediate confusion and conflict of parties, a government will ultimately emerge that is not merely a government in name, but de facto.

There is however little room for doubt as to the industrial recovery of Germany. Already the man-hour output has reached-and in certain instances even surpassed-pre-war figures. According to the Frankfurter Zeitung of May 4, 1922, it had attained 120% of that figure. The most modern machinery, the consolidation of industry, the assistance of the 'Cartels' towards economic unification, the elimination, so far as possible, of waste effort through over-lapping, have counterbalanced any deteriorated morale consequent on the War. And it may be categorically stated that the chief assets of Germany are unimpaired-her energy, her high technical skill, her enterprise, her organizing ability, her calculating effort, and the patience of her people. The creation of enormous trusts has resulted in the gradual concentration of

industrial power in a few hands, until practically only the railways and the posts, which are nationalized, are outside the control of these interests. The interests of the workers are looked after by a system of Works Councils, legalized by act of parliament passed in February, 1920. The National Economic Council, which is in effect an industrial parliament without legislative powers, is charged with the consideration of all bills of social or economic importance before they are submitted to the Reichstag. The Works Councils are composed entirely of employees and workmen. Employers, who are responsible for the expense of these Councils, may attend the meetings, but they have no vote. The Councils, which nominate members to the Board of Directors in an unpaid capacity, may make either for industrial peace or war. They are controlled by the Trade Unions which have a total membership of about twelve and a half million organized workers. The Provisional National Economic Council, which numbers 326, is composed of representatives from every section of the community, employers and employed being equally represented.

The depreciation of the mark affects the whole commercial, financial, industrial and political situation in Germany. The average German, despite his wealth in marks, is poor. But the Industrialist is making vast fortunes by his export trade. He is exporting to Russia, to Denmark and to Rumania. He is shipping to Turkey, Greece and Asia Minorunder a Dutch trade mark. He is rapidly recapturing his temporarily lost trade in the Near East, and supplying British firms in Egypt with cotton machinery at less than 50% of the price it would cost in Britain. He is supplying Palestine with goods of which already two-thirds are carried in German bottoms. There is a difference of about 100%-400% between the price the German manufacturers obtain in their home markets and the proceeds they receive in the foreign (What Germany is Doing, E. Surrey Dane, Introd.) and, as the Industrialists are now a considerable political party, they are in a position to veto any taxation proposals contrary to their financial interests. Consequently, money that might be taxed

cannot be raised for fiscal purposes or for Reparations. The organization of industry has proceeded apace, under the direction of the new Great General Staff, and, in place of the pre-war voluntary organizations, there are to-day compulsory associations of employers and employed. Thanks to the low rate of the mark, Germany is in a position to outbid every other country in the foreign market, and thus we have the anomaly of an immensely poor Government, which would pay its debts but cannot, and an immensely wealthy group of financiers who could pay their debts but will not.

Germany, under present conditions, ought to be the most heavily taxed country in Europe. The reverse is the case. In January, 1922, when wages had risen twelve times above pre-war level, the taxation per head in Germany was about £6-£7 as against £20 in England. Owing to the persistent evasion of taxes and the helplessness on the part of the Government to collect them, the German Treasury is being defrauded of vast sums daily. This is in part due to the centralization of assessment in Berlin, which is resented by the other States in the Reich, and to the general hostility on the part of the German people to the principle of paying taxes which must ultimately find their way into the pockets of the Allies and more especially France. In many cases the Income tax for 1920 has not yet been assessed. When, in consequence of the constant further depreciation of the mark, taxes are collected, the original assessed tax shrinks almost to vanishing point. The incidence of taxation falls most heavily on the professional and the salaried classes, as their income tax is ' generally deducted from salary, rendering evasion impossible. The manufacturer, the financiar, the profiteer, the 'Kettenhändler' (middleman) and the speculator consistently resort to unscrupulous and dishonest devices and subterfuges to defraud the Exchequer. The German educated classes are considerably worse off than in 1914. The real wages of unskilled labour are in general higher; those of skilled labour, lower, than before the War. The flight of German capital abroad which results from insecure conditions in Germany, makes for greater instability in the country owing to the

consequent tendency to impoverish industry. Until some international agreement has been reached in the matter of the payment of taxation, there can be no check in the matter of tax evasion and no control over a vast amount of exported capital. The consequence of the concentration of vast private fortunes in a few hands is seen in the up-to-dateness of German manufacturing plant, the improvement in internal transport system, the widening and deepening of canals, improvements in factories and buildings, and electric power development. Bankrupt Germany is, in other words, preparing a colossal trade drive. The longer the Allies delay in coming to some working arrangement with Germany, the greater will be the capital sum at the disposal of the Industrialists which will go to help the country regain her temporarily lost commercial supremacy.

Germany, one feels, is still in her revolutionary period. She has not yet evolved a final form of government; she still has reactionary hankerings, and, while the Revolution has produced many admirable men, it has not yet evolved a leader in the sense in which the German understands the word. Germany needs-but, unfortunately, she does not want-men who will see to it that the legislative measures of the Central Government will be enforced. The uncertainty of the present and of the future has made the German masses moody and fearful. They are highly strung, restless, dissatisfied, nervous and uneasy. Despite immense activity in the building trade there is an acute housing shortage all over the country. Wages, which are constantly being readjusted, never quite catch up with the constantly rising cost of living, and the weekly household budget, in consequence, never balances. A statutory eight hours day has been introduced in place of the former ten hours, more people work for their living in Germany to-day than before the War, but the lavish display of wealth and the ostentation of the war-profiteers are a source of bitterness to the disgruntled proletariat. Coal is still rationed, and the supply of milk, bread and potatoes is strictly limited. A considerable amount of cereals is still being imported as there is a decreased yield from the soil,