n FROM THE TREATY TO CONFERENCE OF LONDON 33

and in addition to make deliveries in kind on com-mercial lines.

6. Germany is prepared, "up to her powers ofperformance," to assume the obligations of the Allies to America .

7. As an earnest of her good intentions, she offers£50,000,000 (gold) in cash immediately.

If this is compared with Dr. Simons's first offer, itwill be seen that it is at least 50 per cent better,because there is no longer any talk of deducting fromthe total of £2,500,000,000 an alleged (and in factimaginary) sum of £1,000,000,000 in respect of de-liveries prior to May 1, 1921. If we assume an inter-national loan of £250,000,000, costing 8 per centfor interest and sinking fund, 1 the German offeramounted to an immediate payment of £110,000,000per annum, with a possibility of an increase laterin proportion to the rate of Germany' s economicrecovery.

The United States Government, having first ascer-tained privately that this offer would not be accept-able to the Allies, refrained from its formal trans-mission. 2 On this account, and also because it wasovershadowed shortly afterwards by the Second Con-ference of London, this very straightforward proposalhas never received the attention it deserves. It was

1 The practicability of such a loan on a large scale is of course morethan doubtful.

2 The German Government is reported also to have offered, alternatively,to accept any sum which the President of the United States might fix.

D