had no claim on racial grounds, but have in addition exacted from them outrageous sums of money merely in order to make their aggression both territorially and financially profitable to themselves, the word 'indemnity' has become synonymous with spoliation, and spoliation is detestable. The word 'indemnity' has acquired a bad odour. The Allies, Belgium, Serbia, France, Russia, and the rest, are certainly entitled to claim from the Central Powers compensation for their gigantic losses caused by a war which was forced upon them, but they will scarcely make a profit out of such indemnities as they may obtain. The damage done is too large. Germany and her Allies are not rich enough ever to repay their victims. They can pay no more than a tithe of the damage, and they may have to rebuild with their own labour what they have destroyed.
The territorial settlement at the Peace Congress will be effected in accordance with the principle of nationalities. Racial and State limits will be made to coincide wherever possible. However, there may be certain exceptions to the rule. Sometimes various nationalities are inextricably mixed in certain districts, and must be disentangled. Besides, the smaller States created on a racial basis must be secured against an attack from their warlike, powerful, and possibly revengeful neighbours, and they must be able to make a living; they must be economically independent. Lastly, those nations which caused the War, and which may be inclined to renew it, must give guarantees for their good behaviour in the future. They cannot be allowed to dominate their smaller neighbours strategically or economically, and may have to lose certain vantage points. Poland and Serbia must have adequate outlets to the sea. To avoid racial injustice, men of one race who, for pressing strategical or economic reasons may have to be included in another nation, should be given the option of rejoining their brothers across the frontier and be entitled to adequate compensation for disturbance.
There are a number of instances where friction may arise
