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Part II: The Rationing System   (cont'd.)

Chapter 12: Negotiations for a General Contraband Agreement with the Danish Associations

The Chicago meat packers and their operations. – The Danish business houses and the Danish government desire a better regulation. – The Danish government and the March order. – Negotiations with the Chicago meat packers. – The grievances of the Danish shipping companies. – The business community in Denmark desire a general agreement. – Negotiations with the Danish societies. – The general agreement concluded, and cotton imports are rationed.

When Sir Eyre Crowe and M. Clan negotiated the first Danish contraband agreement, each had treated with the other, under the pressure of circumstances that were only partially appreciated. Our authorities knew that prodigious quantities of meats and fats were then passing into Denmark; and it was concluded, that this great flow of unusual trade had been set in motion by the business community in Copenhagen. The Danish government thus fell under what might be called a derived suspicion; for it was assumed, that the authorities in Copenhagen would never be able to enforce their export prohibitions, after they had thus allowed the country to be glutted with contraband; indeed it was doubted whether they honestly wished to enforce their decrees. Facts ascertained during the months following the agreement went far to dissipate these suspicions; for it subsequently became clear that Denmark had been turned into an enormous supply centre for Germany; but that the Danish government, and the business community at Copenhagen, had been innocent of any complicity.

i) The Chicago meat packers and their operations

The actual truth, was that during the first months of the war, a junta of American traders, known collectively as the Chicago meat packers, realized, from the reports of their agents and salesmen, that the populations of northern Germany would be short of meat before the year was out. These most able, but unscrupulous, men at once organized a movement of contraband into Germany, on a scale so great that it seemed almost impossible, that a small combination of business houses should have undertaken it. Copenhagen was chosen as the best depot, because it was a free port with large wharves and warehouses, and the following quantities of meat packers products were passed into it:

Table XXVI:
Imports into Denmark from the U.S.A.
1914. 1913.
Kilos. Kilos.
Imports of beef for the period August-December       348,564   126,139
Imports of lard for the period August-December 15,455,839   3,022,957
Imports of oleo for the period August-December 2,135,225 1,396,732
Imports of guts and plucks
      for the period August-December
1,204,104   425,138

In the main the meat packers conducted their business themselves. Occasionally, they employed a Dane of low character to act on their behalf; but the great Copenhagen firms were no fit agents for the Chicago junta, who desired that their officers should be experienced operators of an American corner: their transit agents, salesmen, [290] and dummy consignees were therefore very carefully selected. The few Danes who were allowed to assist fell into great disrepute among their own countrymen; for the Danish shipowners and commercial magnates, being patriotic, bitterly resented seeing their country endangered by the unscrupulous enterprize of a few foreign traders, and were proportionately contemptuous of those Danes who were party to the venture.

ii) The Danish business houses and the Danish government desire a better regulation

It was some time before these facts were fully appreciated; but when they were better understood, it was evident that our authorities could rely upon the better class of Danes to assist them in preventing a recurrence. The Danish business community, who, though not party to the Clan agreement, were much interested in it, were alarmed at the dangers in which the country had been involved by this American adventure, and determined that Danish commerce should henceforward be conducted by Danes only. The business community at Copenhagen were, indeed, so resentful of every foreign influence, during the first months of the year, that our Commercial attaché, Mr. Turner, found his position very difficult; for the Danes resented every enquiry that he felt it his duty to make. On the other hand, Mr. Turner was convinced, that the great Danish houses were determined to detect, and to report, any firm that was trying to evade the law. This anxiety to clear their country, and to pursue their ordinary business, as far as it could be pursued in circumstances so exceptional, became, later, the motive force of the negotiations undertaken, and the safeguard of the agreements concluded.

The Danes made the first advances. Early in the year, Mr. Prior visited this country, and negotiated an agreement with the Board of Trade. Mr. Prior's agreement secured the Danish textile manufacturers a regular supply of British wool, of cotton, and of cotton goods, all which the Danes ordinarily buy in England. The Industrieraad, or manufacturers' council, whom Mr. Prior represented, did not offer to make themselves sole consignees for British wools and cottons, but they undertook to make enquiries into the business of every Danish manufacturer who applied for a licence to export British goods, and to secure, and to give, guarantees that the articles manufactured from these goods would be sold in Denmark, or in Scandinavia. The Foreign Office were not party to these negotiations; but they learned from them, at a comparatively early date, that there was in Denmark a body representative of the great industries; and that this body was ready, and able, to scrutinize the operations of its members, and to accept responsibility on their behalf.

Meanwhile the Danish government emerged from the fogs of the first controversy as a very honourable body of men, with more firmness of purpose than had been attributed to them during the first uncertainties. They very much enlarged their list of prohibited exports, and, as soon as they were able, forbad the export of imported lard. They were able to do this sooner than was anticipated, for the German agents had bought huge quantities of Danish meats, and dairy produce, during the last months of the year 1914, and the Danish government were confronted with a growing shortage during the summer. By March, the Danish export prohibitions included a considerable number of feeding stuffs, and Sir H. Lowther reported, in despatch after despatch, that the decrees were being rigorously enforced. As was to be anticipated, however, the German exchange system was operated with great severity; for the German authorities refused to accept Danish bacon, or dairy produce, as exchange goods, and demanded, that horses, or rice, or lard, or cocoa, or imported grains, be sent out of the country in return for every licence granted to Danish importers.

iii) The Danish government and the March order

When the March order was issued, and the first detentions of Danish cargoes were ordered, the Danish government at once protested that the agreement concluded with M. Clan was being broken; we answered, that the Clan agreement had been negotiated before we had determined to stop all German imports and exports, and was therefore inoperative; but we invited the Danish authorities to negotiate a new agreement with us; the Danish government never answered this invitation. The German government lodged a very strong protest against the Clan agreement, and the Danish government probably thought it would be dangerous for them to be party to an agreement for operating the March order. For many months, therefore, the Clan agreement was nominally in force.

Nevertheless, the agreements with Captain Cold and Mr. Anderson, though different in point of detail, gave us a positive assurance, that goods carried in their ships would only be delivered to the consignees, if they were to be consumed in Denmark or Scandinavia; and that no goods of German origin would be carried in their vessels. These agreements did, then, give practical effect to the order in council; and the resulting position was, that about seven-tenths of the ships engaged in the overseas trade of Denmark were under bond to perform no service forbidden by an order in council that the Danish government refused to recognise. It will be as well to show what confusion resulted.

The Clan agreement related only to contraband; but was elastic, in that it gave us assurances with regard to any commodity that the British government might subsequently declare contraband. When the agreement was concluded, however, we had assumed, that the three northern powers would enforce their export prohibitions equally; great freedom had, in consequence, been granted to the trade between Denmark and Sweden. Now, as the year advanced, it became patent that the Swedish prohibitions were not being enforced. Whenever, therefore, the Danish authorities claimed that some cargo, then being detained, was entitled to go free by the Clan agreement, Sir Eyre Crowe felt obliged to answer, that the cargo would be released, if the Danes would secure a guarantee against re-export from Stockholm.1 The Danes occasionally complied; but, as often as not, they declined, saying (which was quite reasonable), that a special British mission was then in Stockholm negotiating on that very point; and that they could not make representations, which would expose them to the accusation that they were surreptitiously supporting the British case.

Another equally serious defect in the Clan agreement was that it left the Danish commerce in hides and boots unregulated. By the eleventh article, the Danish government promised: To devise some arrangement for effectively restricting any excessive importation...... of hides of all kinds, dry and wet, pigskins, raw and dressed; leather, dressed and undressed. This rather vague article had not been elaborated by subsequent agreement, and the entire Danish leather trade was, in consequence, more or less under suspicion.

This unsettled point provoked a long, wrangling, controversy, which lasted the entire summer. We discovered later (and the Danes, to do them justice, had not foreseen what would happen), that the Danish leather trade was fed by imported [292] hides. The heavy Danish hides were used for boot soles and saddlery; the lighter, imported, hides were used for boot tops, upholstery, and so on. Having discovered this, we stopped all supplies of quebracho - a bark essential to the tanning factories - on the plea that we would not allow it to enter the country, as it was stimulating a trade in military boots. The Danes at once protested that this was done in violation of the Clan agreement of which the opening preamble ran: The allied governments disclaim any intention of putting pressure on the Danish government with the view of interfering with the export of Danish agricultural or industrial products. The stopping of tanning materials was, in the Danish view, the coercion of a purely Danish industry.

We, however, had grounds of complaint. By the third article, the Danes declared, that it was their firm intention not to raise their export prohibitions. The Danes were, however, obliged to raise their prohibitions twice during the summer. The German exchange system pressed heavily upon them, and they released 10,000 drag horses during July; later, they released a considerable quantity of raw hides, because their leather factories could not use them. The Danish authorities informed us so frankly about these releases, and the reasons for them, that we could hardly fail to appreciate their difficulties. Nevertheless, we pointed out that such operations were forbidden by the very agreement to which the Danish government so obstinately adhered.

The Danish government were thus compelled, by the steady pressure of circumstances, to allow the Clan agreement to be superseded by something more comprehensive. The process of persuasion was, however, slow, because the agreements with the great shipping companies constituted a rough modus vivendi; and it was only when these agreements proved unsatisfactory, that the need for revising them was universally admitted. It will, therefore, be instructive to explain, briefly, why these agreements became inadequate.

It will be remembered, that the two great shipowners negotiated these agreements, in order that they might free their vessels. In return for an undertaking that their ships should not be detained, unloaded, and reloaded, they promised, that any consignment that we suspected should be withheld from the consignees, and, if necessary, brought back to England on the return journey. These agreements gave the shipowners what they desired, but the uncertainties from which they were relieved were only transferred from them to Danish merchants at large. Orders to withhold goods were given almost daily; during August alone, twenty consignments, amounting in all to several thousands of tons of goods, were warehoused. It can therefore be imagined how many manufacturers, dealers, and shopkeepers were left uncertain, whether they could execute their contracts, or fulfil their undertakings.

Again, these agreements did not free all Danish traffic, and although the detentions were lighter during the summer, they by no means ceased. Worse than all this, however, the agreements only relieved Captain Cold for the time being, and, before the summer was out, he was once more at issue with the contraband committee, the reason being that the Chicago meat packers had again resumed their operations.

iv) Negotiations with the Chicago meat packers

In the agreement with M. Clan, the British government promised to come to some arrangement with the Chicago junta; and Mr. Urion, their chief manager, opened negotiations with Mr. Leverton Harris in March. It was soon found, that the meat packers' conditions were of a kind that no British department of state could agree to. Mr. Urion demanded, that all the consignments detained should be paid for at the price obtainable if they had reached their destination, that is, at the famine prices ruling in northern Germany, during the first months of the year. [293] After all this meat and lard had been thus bought up by the British government, Messrs. Armour and Company (the packers salesmen for central Europe) would place the goods on the British market at a commission of seven per cent. When the transaction was completed, the meat packers would reduce their shipments to central Europe to an agreed figure. The substance of these proposals was, therefore, that the British government should pay a subsidy to the meat packers for trying so hard to provision the enemy, and then pay them a commission for glutting the British market. During the negotiations, however, a number of letters came into our hands which, according to the attorney-general: Clearly established the fraudulent transactions of the packers in trying to get their contraband cargoes into Germany through channels ostensibly innocent. As it seemed fruitless to go on treating with persons who were unlikley [sic] to honour any engagement, or to carry out any undertaking, it was decided that the cargoes held should be placed in the prize court; later, they were subject matter of a famous judgement (the Kim case).2 Just before the case came before the court, however, Mr. Urion sent a letter to the Foreign Office, in which he announced that he was not discouraged, and would resume his operations shortly:

      Having regard...... to the state of feeling which exists in the United States. I regard the decision of the prize court as of comparatively minor importance, and whatever decision is arrived at by the prize court will in no way affect my clients conduct, or the steps they will take to obtain through their own government, the redress to which they are entitled.

Heavy shipments were therefore sent in Captain Cold's vessels during the last months of the summer, and it was these shipments which put the shipping agreements in jeopardy. As the action taken by the contraband committee provoked grievances which were, occasionally, not far from bitter indignation, it will be instructive to review the whole matter, without partiality or favour.

v) The grievances of the Danish shipping companies

First as to the bare facts. There can be no doubt, whatever, that the shipments of meat products, lard, and oleo were exceptionally heavy during the summer; the figures were:

Danish imports, January - September, 1915
Lard 12,019 tons.
      Normal for nine months     1,827 "
Margarine and oleo 6,630 "
      Normal for nine months 3,600 "
Meat products 20,539 "
      Normal for nine months 3,879 "

Most of these shipments were made in Captain Cold's steamers, and the contraband committee noticed, that, when the shipments were resumed, names of suspicious consignees (known, or believed with good reason, to be mere agents for the Chicago meat packers), were again to be found in the papers and correspondence.

On the other hand, it is equally beyond question, that the inferences that could fairly be drawn from these figures were not the same as the inferences that could have been drawn from similar figures in January and February. On several occasions during the summer, we asked the Danish government to explain the abnormal importations to which we drew their attention; and, if the explanations given are examined as a whole, they may be said to amount to convincing evidence, that Denmark was short of supplies, and that the authorities were anxious. We had asked for explanations with regard to oil cakes, and with regard to cotton, benzine, and imported grains. In their reply, the Danish authorities had informed us, with [294] an abundance of illustrative figures: That, as their harvest was likely to be bad, they would need larger quantities of winter feed; that, as they could no longer import German piece goods, so, they would need more raw cotton; that they had not, even in midsummer, made good their shortage of petroleum and benzine; and that the prices of their home-made barley and rye breads were rising so fast, that they were compelled to import foreign grains heavily.

These facts were only evidence of a general shortage, and did not bear directly upon the question at issue: Whether the meat packers' heavy shipments would be re-exported, or whether it would be consumed in Denmark. On this point we had, however, reasons for supposing that the Danish government were very anxious about the nation's food supplies, and were preparing for a hard winter; for, during the summer months, decree followed decree for keeping agricultural and dairy produce in the country. Finally, the meat packers' goods were all on the list of prohibited exports. On the whole matter, therefore, it could be said that the Danish authorities would probably do their utmost to keep the greater part of these imported meats in the country. The unregulated trade between Copenhagen and Sweden, and the commercial policy of the Swedish government, of course, still made every general assumption doubtful.

The contraband committee decided to withhold all, or nearly all, the meat packers shipments from the consignees, and asked Captain Cold to store the more doubtful consignments, in accordance with the terms of his agreements. The quantities ordered to be stored were, however, exceedingly heavy, and Captain Cold represented, that, if he refused to carry goods urgently needed in his country, or, alternatively, if he refused to deliver them after the government had forbidden their re-export, he would be in serious trouble with the Danish authorities. Stripped of its incidental details, Captain Cold's plea was, that he had never contemplated choking his warehouses with goods that were on the list of prohibited exports; and that, even though the agreements obliged him to it, equitable consideration ought to be given to his difficulties. As the contraband committee were inexorable, Mr. Calkin (Captain Cold's agent) was compelled to agree that large consignments should be unloaded from the steamers United States, California, and Fredrik VIII, and placed in the prize court. The upshot of the matter was, therefore, that, after a few weeks of relief, the Danish shipowners were suffering all the losses from which they had hoped to free themselves; for their steamers were again being taken off service and detained in British ports, for long and uncertain periods of time.

It remains to be said, although it was natural, that the contraband committee should have been anxious to secure a judgement upon shipments that so closely resembled the shipments condemned in the Kim case, they seem to have decided to stop this new stream of meat cargoes on grounds of policy rather than of law; for, in a memorandum sent to the Foreign Office, when the Danish ships were being unloaded, they argued, with some force, that the Chicago meat stuffs were releasing Danish meats and dairy produce to the enemy, and ought, on that account, to be held up. If however, the committee acted from political motives, they would have done well to have consulted Sir H. Lowther, who alone was competent to counsel them about Danish public sentiment, and Danish policy. He, at all events, was satisfied that it was most unwise to deal so arbitrarily and harshly with persons who had voluntarily come to an agreement with us, whose honour had never been in question, and who were the magnates of a community very friendly to our cause. His review of the whole matter ran thus:

      My dear Crowe,
      I am availing myself of Captain Cold to have this letter delivered by safe hand.
      I think it better to let you know that I gather there is a growing feeling here on the part of the Danish government, and shipping companies which have entered into an agreement with His Majesty's government, that they are being treated with the same suspicion and with as little consideration as if no agreements existed.
[295]       It is the holding up of articles which are on the Danish list of prohibited exports that rankles. These prohibitions I believe to be strictly observed. The feeling appears to be gaining ground that making additions to the prohibition list at the request of His Majesty's government, and endeavouring to act up to the spirit as well as the letter of the Clan agreement, count for nothing.
      If there really is some ground for complaint in this respect, it might, it appears to me, have the affect [sic] of making Danish officials feel that loyalty, in spite of presure [sic] from another quarter, is thrown away, and render them more inclined to follow the line of least resistance.
      I gather, too, that shipping companies who are doing their best to act up to agreements entered into with His Majesty's government are disheartened at finding that goods carried by them, which are covered by the Danish prohibition of export, are not on that account free from suspicion.
      Without full knowledge of any special grounds which His Majesty's government may have for suspicion, I cannot be certain to what extent this feeling, which appears to be assuming the shape of a standing grievance, is justified, but I think it as well to call your attention to the fact that considerable disappointment apparently exists at the small supposed benefit experienced as the result of agreements entered into with His Majesty's government.
      Captain Cold is, I believe, visiting England in the hope of clearing up matters so far as the United Shipping Company is concerned. He believes, I am given to understand, that he has a grievance, and it might I think be useful were he to unburden himself to you, and if you could dispel any misapprehension on his part. I am quite convinced that Captain Cold is absolutely straight and can be treated with such consideration as is possible, without any risk.
      Were it possible to avoid hurting Danish susceptibilities in the matter of articles the export of which from Denmark is prohibited, it would undoubtedly have a good effect.
      The holding up of meat from America destined for consumption in Denmark, and which would release Danish produce for export to England, is also causing considerable feeling, and is being worked up into a national question by the social democrats.
      I would not trouble you with this letter if I were certain that you were aware of the prevalent feeling of dissatisfaction here at the apparent failure of agreements to ease the situation, or if I believed this feeling to be inevitable and that it was impossible to do anything to allay existing irritation.

vi) The business community in Denmark desire a general agreement

It will readily be understood, therefore, that the entire merchant community of Denmark became progressively anxious, as the summer advanced, to devise a system of guarantees, which would be deemed satisfactory by the British authorities. Even if the shipping agreements had worked smoothly, the desire for a more comprehensive arrangement would have been equally strong; for it cannot be too often repeated, that the merchants and traders of northern Europe were striving only to secure the safe, regular, delivery of their goods, which the shipping agreements, in themselves, could never have secured them. Moreover, the merchants of Copenhagen quite appreciated what was the source and origin of these detentions, ware-housings, and uncertainties; for they knew, that the British authorities had collected a list of suspected firms, and were determined to act on their suspicions. This was well known to Captain Cold and Mr. Anderson, and the whole issue was explained to the public at large in a leading article in the Börsen. Being aware of the cause, therefore, the merchants were the better able to devise a remedy.

It has already been explained, that the Danish government and the shipowners both considered that a Danish overseas trust, on the Dutch model, would effect no useful purpose. There were, however, in Denmark, two chambers, or councils, which, though rather different in their constitutions, were co-operations truly representative of the merchants and manufacturers in the country. The merchant guild, or the Grosserer Societat, was composed of individual traders, and represented the merchant community at large. It was an old society, vested with legal powers of a rather peculiar kind, in that it could impose fines and penalties on members who broke its regulations; for these penalties, if contested, were upheld by the Danish courts. The Industrieraad, or manufacturers' council (with whom the Board of Trade had concluded an agreement) was a body representative of the chief industries; no individual, as such, could be a member of the Raad. Although a newer body than the Grosserer Societat, the Raad had similar legal powers.

[296] Early in the summer, the guild made a move, and reported to Mr. Turner that they would henceforward: Legalize all guarantees given by Danish merchants to foreign officials, by which, apparently, they meant, that they would make every importer deposit a declaration before them, and submit to investigation by the merchants' guild. This was done to assist the Danish authorities, but the guild were careful to inform Mr. Turner of the step they had taken, and to let him know, that they would be prepared to apply their system to the entire overseas trade of Denmark. The principal members of the guild and the Raad were well known to Mr. Turner, who was satisfied, that all engagements made by them would be scrupulously and honourably executed.

The system proposed by the guild was thus entirely different from the system operated by the only other commercial body of which we had cognizance. The Netherlands trust was a universal consignee and distributor, with technical subcommittees for advising on metal, rubber, textile, and fuel consignments, and with a number of commercial agents and spies in its service. The Danish guild declined, from the outset, to be a general consignee, and let it be known, that they would not guarantee the raw materials in which the manufacturers council were interested. The Foreign Office therefore received these new proposals very cautiously. As a merchant or tradesman is nearer to the final consumer (and so better able to watch him) than the head of a factory, the officers of the contraband department recognised, that this guild of merchants would, perhaps, be a better guarantor against re-export than the industrial council. On the other hand, there was so much inconvenience in having two guaranteeing bodies, that it was hoped the Raad and the guild might be persuaded to combine. The Foreign Office were, however, doubtful whether the guarantees of these corporations, who had no organized intelligence system, would ever be of a value equal to the value of guarantees given by the overseas trust. Nevertheless, they expressed themselves ready to treat with a representative of the guild, and Doctor Federspiel arrived in London, in the first days of August, and was received by Mr. Sargent.

vii) Negotiations with the Danish societies

Our doubts upon the values of the guarantees were soon dispelled by Doctor Federspiel. In the first place, the guild knew far more about the firms whom we suspected, and the operations on which they were engaged, than we did ourselves. Our authorities had, so to speak, watched them through the keyholes of intercepted telegrams and censored letters: the respectable firms in Copenhagen had been watching them, with intense suspicion and jealousy, for a whole year. Mr. Turner, the commercial attaché, was emphatic that the Danish firms knew more about their rivals than we could ever hope to learn:

      In a small country like Denmark, he wrote, where everybody knows everybody else's business, and where, moreover, 90 per cent. of the trade is done through Copenhagen, an individual has very little chance of carrying on trade without it being known. I have got to know most of the big merchants personally (I usually see from fifteen to twenty people a day on trade matters) and from them I gather, not so much perhaps, what they themselves are doing, but what others are about. No man likes to see another man making a profit which he himself, from lack of initiative, cowardice, or mere honesty, has foregone. It has therefore, been possible to form a pretty shrewd idea as to which merchants are to be trusted and which are not. Evidence gathered in this manner is not suitable for prize court proceedings but the fact that things are known, and enquiries made, acts as a great deterrent. Neither shipping companies, insurance companies nor banks are anxious to do business with firms whose trade will not bear too close an inspection.

Doctor Federspiel explained, moreover, that to deal with the guild would, in itself, be a barrier against suspected firms, as the senate, or council, of the guild had steadily refused to admit these new war firms, and would not guarantee any of their transactions. In all cases in which fraud was alleged, the guild would submit the whole matter to an investigating jury. Doctor Federspiel might have added, that the [297] jury, being trade rivals of the accused person, would be more inclined to break, than to excuse, him. The fine imposed would, moreover, be only a part of the penalty; for the person found guilty would be expelled from the guild, and none of his later applications to import would be so much as considered, he would, in fact be ruined.

The guild's guarantee being thus explained and found satisfactory, it remained to be settled how it should be applied. Mr. Sargent explained, at the outset, that the major purposes of the agreement would be to secure guarantees against re-export of goods to Germany, Sweden, and Norway, and to introduce a general rationing system:

      I made it clear to him, he wrote, that we must reserve our right to prevent imports into Denmark over and above their normal average consumption (i.e., total imports minus exports to enemy countries) as we could not risk the accumulation of stocks in Denmark.

Doctor Federspiel appears to have agreed to the bare principle with as little demur as M. van Vollenhoven; for in all the papers, there is no trace of any dispute upon it. Indeed the doubtful articles in the agreement were settled by applying the rationing principle to the points at issue. The truth is that merchants, and merchant communities rather welcomed the rationing principle, as being one, which, when applied, would make business more regular and steady.

The matter most difficult to settle was the guarantee against re-export to Sweden and Norway. When Doctor Federspiel laid his first project before Mr. Sargent our negotiations with Sweden were labouring heavily, and we felt bound to insist on the guarantee.3 Doctor Federspiel accepted our condition, but explained that Copenhagen was not only a Danish, but, a Scandinavian, port, in that goods of a certain kind were distributed from it to Norway and Sweden, and for these goods the guild could not give a guarantee. Before a settlement could be reached, therefore, an agreed list had to be prepared, specifying the commodities that were recognized to be in this distributing trade, and the quantities normally distributed. This list was the subject of long and careful negotiation; for, although we admitted that exemptions were to be granted to the Scandinavian trade which radiated from Copenhagen, we could not agree that important articles of contraband should be outside the general system of control.

viii) The general agreement concluded, and cotton imports are rationed

This preparing of an agreed list much protracted the negotiation; for Doctor Federspiel was compelled to return to Copenhagen to consult with his board. The amalgamation between the Raad and the guild was found to be impossible; both bodies were, however, party to the final agreement. By this instrument, which was signed early in November, the guild and the Raad undertook to give the British government a guarantee that imported cargoes certified by them would be consumed in Denmark. The goods that might be re-exported to Scandinavian countries were specified (cocoa, coffee and metal plates were the most important items); the guild and the Raad undertook, however, to secure additional guarantees from every Swedish and Norwegian consignee of the goods, and the entire trade was to be reduced to normal. A small list of articles that might be exported to Germany, notwithstanding that they might have been manufactured from British raw materials, was added; but this trade was also limited to an agreed figure. It was, indeed, only a list of miscellaneous articles such as printer's ink, earthenware goods, dairy machines, and so on. Finally, the goods that might be exported to Germany, for securing an exchange, were specified; and it was something of a concession that tea, which was obtained entirely from Great Britain, was included in the list. As has been explained, the agreement was declared, from the outset, to be an instrument for introducing a general system of rationing. It was further agreed, that the articles to be rationed, and the quantities to be allowed should be the subject of separate agreements. The Danish representatives consented, however, and apparently without [298] disliking the suggestion at all, that the commodities of which the imports had appeared to us to be abnormal, and a good many more as well, should be rationed.4

These matters were not settled for several months; but a great advance was made by the Raad during the negotiations. Danish imports of cotton had been the subject of frequent enquiry during the summer. We were satisfied the imports had been unusual and the Danes did not deny it; but explained (as has been said before) that their textile industries were striving to manufacture the piece goods that were ordinarily bought from Germany, and so needed more cotton. Once again, therefore, we were reminded how weak are the inferences drawn from bare statistics. It is, however, interesting to juxtapose the figures which seemed to justify such strong suspicions, and the figures which dissipated them.

We informed the Danes, that, if our observations were correct, they had received some nineteen thousand tons of cotton between January and July; and that their normal importations, for a period of seven months were about 3,700 tons. The Danes did not dispute our figures; but answered, that, owing to the convulsions of the previous year, they had lost some four thousands of tons of cotton that was ordinarily bought in Germany; and that, whatever our statisticians might allege, the books of their four great spinning houses proved, conclusively, that they needed cotton, and that they would be compelled to close down, if more cotton cargoes were stopped. They communicated the stocks then held by these houses, and, although it was impossible to compare these figures with our import statistics, it was equally impossible to doubt that they were accurate.5

On a closer inspection of the matter, however, it was found that the Danish calculations for the future did not differ very materially from ours; they estimated that they would need 625 tons a month, and we, that they would need 500. In a negotiation with the Industrieraad, which seems to have been very short, we granted the higher figure. Cotton imports into Denmark were therefore rationed before the general agreement for rationing the country was concluded.6

1See, in particular, Sir E. Crowe's minute on 108761/F287/15:
      We may eventually have to point out to the Danish government that article 26 of our agreement of 2nd February would obviously be altogether stultified and meaningless if Denmark gave large exemptions for re-exports to Sweden, in the case of goods whose export from Sweden is prohibited, unless the word means effectively prohibited. If, and so long as Sweden adopts the practice of granting unlimited exemptions in favour of goods going to Germany, we cannot admit that the export of those goods is prohibited in the only sense of the word that would have any meaning in article 26. ...back...

2See, also, Chapter X, section vi. ...back...

3See Chapter XVI. ...back...

4The list agreed to by the Danish representatives was:
Cocoa. Hemp (raw). Tanning materials.
Copper (wrought, part
    wrought and unwrought).
Jute (unmanufactured).  
Nitrate of soda.
Tin (unwrought).
Paraffin wax.
Animal oils and fats. Rubber. Rosin.
Vegetable oils and fats. Wool (raw). Nickel.
Oleaginous nuts, seeds and kernels.   Hides. Antimony.
Corkwood and its manufactures. Leather. Ferro tungsten.
Graphite. Turpentine. Ferro chrome.

5The figures were:
Firm Stock
in hand
for 1915
Danske Bomuldsspinderier
    Velje and Valby
1,200   3 20,000   12,000  
Windfield Hanses Bomulds-
    spinderier Velje
425 4 5,000 2,500
Forenede Textilfabriker-Aalborg 700 8 3,900 1,650
Forenede Jyske Farverier
    ogtrikotage fabriker-Aarhus
240 8 1,500   900

6See Agreements print. Cotton agreement between the Industrieraadet and H.B.M.G., August, 1915, and 117768/F2671/15. ...back...

A History of the Blockade of Germany
and of the countries associated with her in the Great War:
Austria-Hungary, Bulgaria and Turkey.

by A. C. Bell (Historical Section, Committee of Imperial Defence).