Mr. Balfour replied that it would be necessary to consult his naval and military advisers before he answered that question.  He said that he would return in a day or two and make an explicit statement.  He did so and his answer was this:  Under these circumstances—­that the United States should make war to the full limit of its power, in men and resources—­the war could not be ended until the summer or the autumn of 1919.  Mr. McAdoo put the same question in the same form to the French and Italian Missions and obtained precisely the same answer.

Page’s papers show that Mr. Balfour, in the early stages of American participation, regarded the financial situation as the thing which chiefly threatened the success of the Allied cause.  So much greater emphasis has been laid upon the submarine warfare that this may at first seem rather a misreading of Great Britain’s peril.  Yet the fact is that the high rate of exchange and the depredatory U-boat represented almost identically the same danger.  The prospect that so darkened the horizon in the spring of 1917 was the possible isolation of Great Britain.  England’s weakness, as always, consisted in the fact that she was an island, that she could not feed herself with her own resources and that she had only about six weeks’ supply of food ahead of her at any one time.  If Germany could cut the lines of communication and so prevent essential supplies from reaching British ports, the population of Great Britain could be starved into surrender in a very brief time, France would be overwhelmed, and the triumph of the Prussian cause would be complete.  That the success of the German submarine campaign would accomplish this result was a fact that the popular mind readily grasped.  What it did not so clearly see, however, was that the financial collapse of Great Britain would cut these lines of communication quite as effectually as the submarine itself.  The British were practically dependent for their existence upon the food brought from the United States, just as the Allied armies were largely dependent upon the steel which came from the great industrial plants of this country.  If Great Britain could not find the money with which to purchase these supplies, it is quite apparent that they could not be shipped.  The collapse of British credit therefore would have produced the isolation of the British Isles and led to a British surrender, just as effectively as would the success of the German submarine campaign.

As soon as Bernstorff was sent home, therefore, and the participation of this country in the war became extremely probable, Mr. Balfour took up the financial question with Page.

     To the President
     March 5, 1917.