At home, meanwhile, the campaign against alien enemies had culminated in an attack in the Globe on Prince Louis of Battenberg, the First Sea Lord, who had been popularly (but absurdly) reported for some time to be confined in the Tower on a charge of treason. On October 30 a letter from him was published tendering his resignation on the ground that his birth and parentage in some respects impaired his usefulness; and Mr. Churchill, in accepting his resignation, cordially testified to his great services, notably to his having taken the first step securing the concentration of the Fleet at the outbreak of the war. The attack, it need scarcely be said, was baseless; the Battenberg Princes had every reason to detest the Prussian Court, and Prince Louis had been an Englishman from boyhood, and had strenuously exerted himself to gain naval knowledge and apply it for the advancement of the British Navy. But he was regarded in some quarters as too compliant to the First Lord's demands, and he had not been forgiven for his disavowal of his alleged speech (p. 35). Lord Fisher of Kilverstone, however, proved an entirely satisfactory successor.

The new First Sea Lord was soon confronted with the task of avenging a grave British naval defeat. On November 6 it was announced that on Sunday, November 1, five German warships, the Scharnhorst, Gneisenau, Leipzig, Dresden, and Nürnberg, had concentrated off Santa Maria Island, near Coronel, Chile, and engaged a British squadron under Rear-Admiral Cradock, consisting of the cruisers Good Hope and Monmouth, the light cruiser Glasgow, and the armed merchant cruiser Otranto, and that the Good Hope and Monmouth had been sunk and the Glasgow seriously damaged. The details remained obscure for some time, even to the Admiralty; but it was eventually learnt that the British ships had been met near sunset by the German squadron, that the Admiral had determined to engage notwithstanding his inferiority in speed and gun-power, and had warned off the battleship Canopus, which was coming up from the Straits of Magellan, as her speed was insufficient to cope with the Germans, and had ordered the Otranto to keep out of danger; that the Germans forced the British ships into a position where the setting sun interfered with their aim, that the British guns were outranged and that the Monmouth was sunk, and the Good Hope blown up while making for the shore, the Glasgow escaping. The loss of men was heavy; so was the blow to British prestige.

It was tolerably clear, moreover, that the German ships, coming as they did from the Chinese coast, could not have obtained coal or provisions without some violation of neutrality; and it was found that they had been supplied by Kosmos liners from Chilean ports, by an American collier at Juan Fernandez, and by other ships at the Galapagos Islands, belonging to Ecuador. The Chilean Government had not been involved; but Ecuador and Colombia were suspected of breaches of neutrality. And in other quarters there were new dangers. The collapse of Maritz's rebellion at the Cape had been followed by a more serious rising led by Generals de Wet and Beyers; and the British forces had suffered a serious reverse on November 2 in German East Africa.

It was amid these impressions that the Lord Mayor's banquet was held at the Guildhall (Nov. 10). The first toast after the loyal toasts was that of "Our Allies," proposed by Mr. Balfour. He described the capture of Tsingtau as a most dramatic answer to one of the most insulting messages ever sent from one Sovereign to another [in 1897] and as a good omen for those still fighting the arch-enemy in Europe. Russia had shown not only dogged and boundless courage, but unexpected powers of organisation; the war had brought out the military genius not only of a nation, but of a man (the Grand Duke Nicholas). As for the gallant French, never would the time grow dim in which they and the British fought side by side against the common foe of civilisation. Serbia, to preserve the peace of the world, had been prepared to give up everything short of her national existence, but she had gallantly defended it, and there was no chance now that Austria would wrest it from her. The case of Belgium was even more tragic. Cynicism could go no farther than the Germans had carried it, and the memory of the accumulated infamy of their transaction would be remembered after the crime, great as it was, had been adequately expiated. The Allies were fighting for civilisation and the cause of small States, and whether the war was short or long, they would triumph. They had behind them all the finest moral influences of the civilised world.

M. Cambon, the French Ambassador, in reply, said that Europe had suffered invasions of barbarians in the past, but had never yet seen barbarism raised to dogma and reinforced by science. But its professors had not foreseen that they would come into conflict with the conscience of the civilised world.

The First Lord of the Admiralty, responding to the toast of "The Imperial Forces of the Crown," said that it was thanks to the Navy that they were there. In a recent conversation with Sir John Jellicoe and his chief Admiral they had remarked that Cornwallis was three years off Brest and Nelson more than two off Toulon; they themselves were only just beginning, and their turn would come. The multiplied duties of the Navy arising from the curious and novel conditions of naval warfare forced them to expose a target to the enemy incomparably larger than any target exposed to our own daring and vigilant sailors. The Navy was making good the motto "Business as usual"; the economic stringency resulting from a blockade required time to reach its full effectiveness; but in the sixth, ninth, or twelfth month they would see results gradually and silently achieved which would spell the doom of Germany. The Navy, too, gave Britain and the British Empire the time to realise their vast military power. At the end of a hundred days of war the Navy was actually and relatively stronger than when war was declared, particularly in the branches most influential in the struggle.

Earl Kitchener, who also responded, said that every officer returning from the front said that the men were doing splendidly. He eulogised the Regular, Territorial, and Indian troops, and those of each Ally, remarking that General Joffre was not only a great soldier, but a great man. The British Empire was fighting for its existence; only if that fact were realised could there come the great national and moral impulse without which Governments and armies could do little. He had no complaint to make of the response to his appeal for men, and the progress in military training of those already enlisted was remarkable; but he would want more men, and, still more, till the enemy was crushed. He alluded, briefly, to the inevitable discomforts of the recruits, as having been already greatly diminished, and remarked that the German use of elaborate destructive machinery was facilitated by their having fixed the date of war beforehand. He referred briefly to the gallant conduct of the Army in the trenches, to the Dominion contingents, and to the 1,250,000 soldiers in training in Great Britain eagerly waiting for the call. Every man would, in doing his duty, sustain the credit of the British Army, which had never stood higher.

The Prime Minister, in responding to the toast of His Majesty's Ministers, referred to the annexation of Bosnia and the Turkish revolution, the first as the earliest cause of the war, the second as raising vain hopes of the renascence of Turkey. Not the Turkish people, but the Ottoman Government, had sent Turkey to her doom. Great Britain had no quarrel with the Moslem subjects of the Sultan; millions of Mohammedans were among the most loyal subjects of the King; she was prepared, if necessary, to defend their Holy Places against all invaders. The Turkish Empire had committed suicide. Reviewing the financial measures taken by the Government, Mr. Asquith made special mention of the services of the Lord Chief Justice (Lord Reading), and of Mr. Walter Cunliffe, Governor of the Bank of England, on whom a Peerage was conferred. He warned his hearers that, though little was seen of the war save darkened streets and a preponderance of khaki-clad men, it would be a long-drawn out struggle, but there was nothing in the warfare of the past 100 days to damp British hopes or impair British resolve. The enemy had tried in turn three separate objectives—Paris, Warsaw, Calais; from each in turn they had retired balked and frustrated; but that was not enough. We should not sheathe the sword until Belgium recovered all and more than all that she had sacrificed, until France was adequately secured against the menace of aggression, until the rights of the smaller nationalities were placed on an unassailable foundation, until the military dominion of Prussia was fully and finally destroyed. It was a great task, worthy of a great nation. The Primate and the Lord Chief Justice were among the other speakers.

On the same evening the Chancellor of the Exchequer addressed a great Nonconformist recruiting meeting at the City Temple. The principle that drew him to resist his own country in the Boer War, he said—defence of small nationalities—had brought him there. One of the greatest French generals, describing his own experience, had said to him that "the man responsible for this war had the soul of a devil." Great Britain was not responsible. We were organised for defence—against all the Powers of the world. We had raised the greatest Volunteer Army on record, and in a few months we should double it. For an aggressive war we could not have raised a tenth of it. At the outbreak of war we were on better terms with Germany than we had been for fifteen years. The vulture had been hanging over Belgium, but it pounced, not on a rabbit, but on a hedgehog, and had been bleeding and sore ever since. We now knew that the counsellors of Germany had planned and organised the murder of peaceful neighbours, and even fixed the date to suit themselves. Peace at any price was not a Christian principle. The surest way of establishing peace on earth was to make the way of the peacebreaker too hard for rulers to tread. After denouncing German action in Belgium and coupling the Turks of the East with their fitting comrades the Turks of the West, he referred to the cost of the war—which would not be grudged—and condemned those who approved of the war and left the necessary sacrifices to others. Could Britain, fighting one of the most chivalrous wars the world had ever seen, not rely on her children to rally to her honour?

The encouragement given by these speeches had already been begun by the news that the Königsberg had been shut up in East Africa by H.M.S. Chatham and the Emden destroyed by H.M.A.S. Sydney at the Cocos or Keeling Islands (Chron., Nov. 10); and the sinking of H.M.S. Niger by a submarine next day in the Downs, two miles off Deal, served merely as a salutary reminder that the war was near at hand. And the unity of the nation was further emphasised during the short session of Parliament which now began.

Parliament was opened by the King in person on November 11, with much the usual ceremony, save that the State coach with the famous cream-coloured horses was replaced by a glass coach with black horses. Many of the King's servants trained in Court ceremonial had gone to the front; the dresses of the Queen and most of the Peeresses in the House of Lords were black; and several members of the Commons wore khaki. (The members serving in the Navy, Army, and Auxiliary Forces numbered 126.) The King read his speech, of which only portions can be here given. The salient passage referring to the entry of Turkey into the war was as follows:—

The speech concluded as follows:—

The debates in both Houses, which cannot here be fully summarised, exhibited the unity of all parties regarding the essentials of the war, while there was some Opposition criticism of certain of its incidents. In the Upper House the Address was moved by Lord Methuen, who emphasised the pride of the nation in its Army, and seconded by Viscount Bryce, who referred to the "streams of letters" from the United States evincing the width and depth of American sympathy, and declared that a conflict of principles like the war could not end till one or other principle triumphed. Earl Curzon, in the absence through illness of the Marquess of Lansdowne, took his place as Opposition leader, reviewing the situation and criticising the scale of allowances and pensions to dependants of soldiers, and the official reticence as to the deeds of the troops in the field. The Marquess of Crewe, replying, promised consideration of these points; the Earl of Selborne asked about the Antwerp expedition and the defeat off Chile, criticised the First Lord's practice of sending messages to foreign Powers and the Fleets in his own name instead of that of the Board of Admiralty, and declared the attack on Prince Louis of Battenberg to be "a national humiliation." The Earl of Crawford, supported subsequently by Lord Leith of Fyvie, made important allegations of official laxity in dealing with alien enemies in Fifeshire, stating that petrol had been exported and dynamite imported illegally, and that a neutral steamer had been found with sawdust in some of her coal-bunkers, indicating that she had been laying mines.[4] The Lord Chancellor said that what was done at Antwerp had to be done quickly, and was done by the First Lord after consulting the War Secretary; the Government took the responsibility, and thought the intervention had been useful. The First Lord of the Admiralty had not, he thought, sent communications in his own name to an inordinate extent, but he was anxious to conform to the best practice on the subject. The Government were grateful for the support given by the Opposition.

In the Commons the Address was moved by Sir R. Price (L., Norfolk, E.) and seconded by Mr. Middlebrook (L., Leeds, S.).

Mr. Bonar Law, after an eloquent reference to the bereavements sustained by members, and a hopeful review of the situation, said that the Opposition would press no amendment to a division, but would raise certain questions. He mentioned the Antwerp expedition and the naval disaster off Chile, the treatment of alien enemies, in which he hoped that the Government was not being influenced by clamouring newspapers, the secrecy as to the doings of the armies, and two special hindrances to recruiting—the fact that the dependants of soldiers did not get what they were promised, and the uncertainty as to the intentions of the Government regarding their future after the war. He suggested the reference of the subject to a small Committee.

The Prime Minister, after expressing confidence in the success of the Allies, declared that the responsibility for the Antwerp expedition rested with the whole Government, and that the expedition was a material and useful factor in the campaign. The internment of alien enemies was preliminary to a sifting process. A censorship was inevitable in modern warfare, and news could only be published after consultation with our Allies. He defended the scale of allowances to childless widows (7s. 6d. as a weekly minimum) on the ground that a larger grant might depress the labour market. Moreover, the burden imposed by the existing scheme on the country for ten years after the war would be from 10,000,000l. to 15,000,000l. annually. He welcomed Mr. Bonar Law's proposal of a Committee, and mentioned that of the 1,186,000 men voted during the year for the Regular Army less than 100,000 were still lacking. He fully acknowledged the loyal co-operation of the Opposition and the Labour party.

Next day Mr. Henderson (Lab.), after promising the full support of organised Labour in maintaining the "splendid unity" of the nation, complained of the shocking lack of provision for recruits in the camps, the grievances of soldiers, and the ill-judged supervision exercised over their wives. Mr. Long (U.) dealt with the delays of pay and allowances, and the Financial Secretary of the War Office explained the inevitable difficulties set up by the novel conditions and the unprecedented strain on the War Office. Mr. Joynson-Hicks (U.) moved an amendment raising the question of danger from spies. The Home Secretary, after declaring that he ignored the unprecedentedly numerous Press attacks on himself personally, said that the responsibility for internment rested on the military authorities, and the Home Office acted under their direction. At first those interned were selected as being personally suspected, later as being out of employment and therefore possibly dangerous; in October the military question changed in aspect, and more were arrested at the wish of the military authorities, who again slackened their demand. He referred to an allegation unsupported by evidence, that the three cruisers (Chron., Sept. 22) had been sunk through espionage, and defended the Home Office against the charge of inaction. Mr. Bonar Law said that the better man a German was, the more likely he was to take risks for his country when it was at war; Lody (Chron., Nov. 5) was as much a patriot as any soldier killed in action. The Opposition wanted to see that the rounding up of spies was properly done. The enemy aliens most likely to injure England were the best educated and the best off. The Secretary for Scotland dealt with the measures taken in that country, but Sir H. Dalziel (L., Kirkcaldy Burghs) declared that petrol had been supplied from a Scottish port to German submarines through a Danish ship, and that some of the most dangerous spies were not Germans.

Sir W. Bull (U., Fulham) then moved an amendment complaining of the restrictions placed by the Press Bureau on the publication of war news. The Solicitor-General's reply was regarded on both sides as disquieting. The Bureau, he said, should not stop criticism unless it would destroy confidence in the Government or cause alarm by inducing a belief that the situation was very grave. He mentioned incidentally that the Censors had much news of disasters to British capital ships, all of it false, and that certain articles on foreign policy had impaired British relations with neutral States. His thought was only of British soldiers and sailors. The Press Bureau alone stood between the Press and the untempered severities of martial law.

A revised scheme had been issued earlier in the week of pensions for soldiers and sailors and their dependants. A widow with four children would receive 20s., with three 17s. 6d., with two 15s., with one, 12s. 6d., with none, 7s. 6d. These might be increased on the recommendation of the Old Age Pensions Committee. The separation allowance would be continued for six months after widowhood. The minimum disablement allowances would be 14s. for unmarried men, 16s. 6d. for married men without children, rising to a magnitude of 23s. The estimated burden on the country would range, according to the duration of the war and the percentage of deaths and disablements, from 99,000,000l. to 202,000,000l.

At the opening of the following week—which was saddened by the unexpected news of the death of Earl Roberts—the Prime Minister moved a Vote of Credit for 225,000,000l., and an addition to the Regular Army of 1,000,000 men. He first explained—necessarily without details—that of the 100,000,000l. previously voted the largest portion had been spent on the operations of the war; other outlays were on loans to the Allies, a very large sum to secure the food supplies, especially sugar, wheat, and other necessaries, a considerable sum to obtain control of the railways, and expenditure on succour for refugees and destitute aliens. The bulk of the money now asked for would be spent on the Army and Navy; but loans not for the use of Great Britain would amount to 44,000,000l. This, however, would include a comparatively small sum possibly needed for the relief of local distress at home. The Belgian Government had already received 10,000,000l., the Servian Government 800,000l. The Government would relieve the Dominions of the responsibility of raising loans by advancing them 30,250,000l. The war had cost between 900,000l. and 1,000,000l. a day; the provision asked would last up to March 31, leaving a reasonable margin. The Estimates had been carefully considered and repeatedly revised, and represented the minimum which should be asked for in the greatest emergency in British history.

Mr. Long (U.) expressed satisfaction with the Prime Minister's statement, suggested improvement of the pay and allowances of officers, and urged that recruiting should be stimulated by war correspondence and that greater power should be given to commanders to confer decorations. Sir H. Dalziel (L.) gave surprising and suggestive figures of the increased exports of coal, cocoa, tea, and other articles to the neutral countries near to Germany; and, among other speakers, Mr. Healy (I.N.) vigorously condemned the Press censorship. There was some divergence of opinion as to the degree of drinking among the troops.

The Prime Minister replied at some length to the points raised. As to war correspondence, the other Allies must have the decisive voice. The increased exports of coal to Scandinavia were caused by the cessation of German supplies; as to tea, there were ways by which the export to Germany might be stopped. Of the new Army not more than 15 per cent. had suffered from disease of any kind, and its average standard of conduct was worthy of the country and of the cause. The Regular Army now numbered 1,100,000; since the beginning of August 700,000 recruits had joined, besides at least 200,000 Territorials. He gave very high praise to the latter Force. But they wanted another million. The votes were agreed to, and the sitting closed with an energetic repudiation by Mr. Edgar Jones (L., Merthyr Tydfil) and the Government of attacks recently made by Mr. Keir Hardie (Lab., Merthyr Tydfil) on the Army.

Next day (Nov. 17) the proceedings in both Houses opened with tributes to the memory of Earl Roberts. In the House of Lords Earl Kitchener, Earl Curzon of Kedleston, and the Marquess of Crewe bore eloquent testimony to the late Field-Marshal's military achievements, his devotion to his country, his comradeship with his men, and his character as a Christian. In the Commons, the Prime Minister gave notice of an Address to the Crown, asking that a monument might be erected at the cost of the State, and spoke of Earl Roberts's consummate strategy, rare powers of leadership, a unique faculty of attracting the devotion of his men, and his mastery of the art of war, and of his eagerness, expressed in their last conversation, to be of use in any capacity in "this latest and greatest of our wars." Mr. Bonar Law found a parallel to his character in Thackeray's Colonel Newcome; Mr. John Redmond (N., Waterford) reminded the House that Earl Roberts was an honorary freeman of that borough, and mentioned that he had desired to speak at Dublin along with the Prime Minister and himself (p. 215); and Sir Ivor Herbert (L.) and Colonel Yate (U.) added their tributes as former officers of Earl Roberts's staff.

Earl Roberts's funeral took place on November 19 with simple but impressive ceremony. The remains, which had been brought back to his house at Ascot, were conveyed thence by special train to Charing Cross, whence they were borne on a gun carriage by the Embankment and Ludgate Hill to St. Paul's Cathedral, escorted by troops representing the Territorials, the Guards, Infantry, Cavalry, and Artillery, a naval detachment, and a mountain battery; and Earl Kitchener, Sir Evelyn Wood, Lord Methuen, and Lord Charles Beresford, were among the pall-bearers, who attended the remains from the Embankment to the Cathedral. At the door the Cathedral choir and clergy met and preceded the coffin, which was followed by the pall-bearers, the Primate, and the King. Many hundreds of the public visited the grave in the afternoon. A memorial monument was to be erected at the public cost.

To return to Parliament: on November 17 the War Budget was introduced by the Chancellor of the Exchequer. After giving figures (to be found in the appended table) showing that he had to provide for a deficit by March 31 of 339,571,000l., he argued that a substantial part of this must be raised by taxation, justifying this course by the precedents set by Pitt in the French wars and Gladstone in the Crimean War. This war would cost at least 450,000,000l. in the first full year; not to tax heavily for it would be a serious departure from honoured and unbroken national tradition. If Great Britain now rose to the heroic level of 1798, she would be raising a revenue of from 450,000,000l. to 700,000,000l., and no borrowing would be needed. It was wisest to assume that the war would be long; it would be folly to borrow to meet interest on loans and loss of revenue; four-fifths of the money raised would be spent in Great Britain, and during the war and after reconstruction there would be practically no competition in neutral markets, except from America. For four or five years, therefore, British industries would be artificially stimulated; but afterwards our customers' purchasing power would be crippled and much capital would have been exhausted. During the period of inflation, therefore, as much as possible should be raised by taxation. War, too, was a time of sacrifice and self-denial, and readiness to bear taxation would strengthen British credit. No taxes would be levied interfering with productive industries, but all classes would be reached. The income tax would be doubled, but in the current year would be collected on only one-third of the income, so that it would be 1s. 8d. from December 1 on unearned and 1s. on earned income. Arrangements would be made to meet serious cases of loss of income through the war. As to the class that did not pay income tax, Ministers had regretfully abandoned the idea of a tax on wages, owing to the difficulties of dealing with varying rates, casual labour, and half-timers, and of reaching small shopkeepers; and they had to resort to indirect taxation. Beer was taxed very lightly as compared with other alcoholic drinks. The half-pint was the commonest measure of consumption, and an additional duty of 17s. 3d. per barrel would enable an extra halfpenny per half-pint to be charged to the consumer, leaving a fair margin for the brewer and publican; the lighter the beer, the larger the margin. The licence duty would be reduced proportionately to the curtailment of hours (p. 195), except near camping centres, and the brewer would be given a month's credit for payment of duty. The estimated increase of revenue from the source in 1914-15 would be 2,050,000l. and in 1915-16 17,600,000l. Increased duties on spirits would be unproductive, on wine undesirable, because much of it came from our Allies or the Dominions, and the consumption was diminishing. The "elusive teetotaller" could not be reached, as people supposed, by taxing mineral waters, three-fourths of which were drunk with alcohol; tea must be taxed; a graduated tax was impossible, so the tax would be increased by 3d. all round, to the figure of the Boer War. Finally, 2,750,000l. would be raised, as he showed at length, by partially suspending the Sinking Fund. This would still leave a deficit of 321,321,000l. Of this 91,000,000l. had already been borrowed by Treasury Bills. As he showed at length, it was eminently desirable to borrow enough to carry on beyond the current financial year, and the sum proposed would render a further appeal unnecessary up to July, 1915. After extensive consultation, it had been decided to issue a loan at 3½ per cent., a rate brought up to 4 per cent. by issue below par and the guarantee of early redemption. It would be a 3½ per cent. security issued at 95, to be redeemed by the Government at par on March 1, 1928, or, subject to three months' notice, at any time between March 1, 1925, and March 1, 1928, and the amount would be 350,000,000l., of which 100,000,000l. had already been offered firm. It would not be issued in sums of less than 100l., as that course would deplete the savings banks. After explaining the arrangements, Mr. Lloyd George stated that the Bank of England would be prepared, till March 1, 1918, to make advances against deposits of the loan taken at the issue price without margin at 1 per cent. below the ordinary Bank rate. It was of immense importance that the money should be subscribed, but it would be an excellent investment, because Great Britain's credit was still the best, and it would be a still better investment after the war. There would then be no more màlevolent talk about the decay and downfall of the British Empire.

Mr. Chamberlain, speaking for the Opposition, took no objection to the spirit and principles of the Chancellor's speech, but regretted that the proposals had not been made at the outset of the war, and that revenue was confined to so few fruitful channels. But he made no opposition to the general proposals, and was sure that every income-tax payer would bear his share.

We append a table (taken from The Times) showing "the Budget in brief."

THE NEW TAXES.

INCOME TAX.

YIELD OF NEW TAXATION.

The sacrifices demanded by the Budget were patriotically accepted by the nation, but concessions were made in regard to the income tax, supertax, and the beer tax. In the debate (Nov. 19) the Attorney-General explained that payers of income tax would be allowed, as they had been before 1907, to take into account their actual income for the year, and supertax payers would pay on the year's income instead of the three years' average, provided that in both cases their income had been reduced owing solely to the war; Mr. Henderson (Lab.) thought that the tea duty should have been increased by 2d. only, and that the only fair way to treat the working classes was by a graduated wage tax—a proposition which the Chancellor of the Exchequer accepted in principle, but declared to be impracticable at that time. Objections made to the increase of the beer tax were met (Nov. 24) by the concession of a rebate of 2s. per barrel up to March 31, 1916, and 1s. from that date to March 31, 1917, to enable the trade to adapt itself. The tax was calculated, it was explained, by gravity, not by bulk, and the publican would gain most on the lighter beers. The concession, however, was regarded by Mr. A. Chamberlain and others as inadequate. A concession in respect of income tax was made also to members of the Army and Navy and Red Cross ambulance workers, allowing them to pay on actual instead of on average income.

The debates on the following days require little notice. A Committee of the Commons was appointed (Nov. 18) to deal with pensions and allowances to wounded soldiers, and to children and dependants of those killed in the war; and the Reports of Supply and the debates on the Consolidated Fund Bill provided opportunities for raising various questions connected with the war. It may be mentioned that Mr. Wedgwood (L.), who appeared in the House in uniform, asked the Government (Nov. 23) to direct the civil population what they were to do in the event of a German raid, improbable though such a contingency might be. He urged that every one ought to fight the Germans if they came. The Under-Secretary for War, however, replied that emergency committees to deal with the subject were being formed, but for the present it was undesirable to make public any instructions. [Such instructions were, however, issued privately to local authorities, parish clergy, and other prominent persons in certain districts.] We may mention also an emphatic protest by the Opposition leader against the restrictive interpretation put by the Solicitor-General on the powers of the Press Bureau (p. 233); as the result, the Government two days later agreed to qualify considerably the clause in the Defence of the Realm Bill giving them powers "to prevent the spread of reports likely to cause disaffection or alarm," and the Solicitor-General also qualified his previous utterance.

On November 25 the House was informed through the medium of the Under-Secretary for India, that Colombia and Ecuador had failed to observe an attitude of strict neutrality. Colombia, in spite of representations from the British charge d'affaires, had allowed the wireless station at Cartagena to continue working with its German staff, nominally under censorship, really under German influence; and German steamers in Colombian ports, though their wireless installations had ostensibly been dismantled, had continued to use them with the attachment of a muffler. As to Ecuador, its Foreign Minister had informed the British and French representatives at Quito on October 4 that German warships had used the Galapagos Islands as a naval base, and the Ecuadorean Government had not complied with the request of the British and French legations to prevent the use of the wireless station at Guayaquil as an intelligence centre for belligerents. The Government had therefore decided to appeal, in conjunction with that of France, to the good offices of the United States Government. [This was a notable recognition of the Monroe doctrine, but both the offending States were likely, from their recent history, to be specially resentful of American interference.]

The day following (Nov. 26) was marked by a grave naval disaster. The battleship Bulwark, lying off Sheerness, blew up at 7.35 A.M., probably through an internal magazine explosion, and only fourteen men were saved out of a crew exceeding 750. No reason was discovered for supposing that the disaster was not due to accident, but its precise cause was not ascertainable. In announcing the disaster to the House, the First Lord said that the mere loss of the ship did not sensibly affect the military position, and expressed, on behalf of the House, its sorrow and its sympathy with the relatives and friends of the victims.

Next, the Under-Secretary for India moved a resolution sanctioning the application of Indian revenues to war expenditure outside India, but not in Europe. He mentioned that the Indian troops, besides their work at Tsingtau, Fao, and Basra, were in force in Egypt, took part in the landing at Sheikh Said and in the attack, against great odds, in East Africa, and had speedily adapted themselves to the novel conditions of fighting in France. Of their record both India and England would be proud. He mentioned again the zeal and munificence of the ruling Chiefs, the reasoned loyalty of the Indian educated classes, as well as the "wave of instructive and emotional loyalty" that had swept over India, and announced the creation of an Executive Council in the United Provinces, and he indicated the hope of increasing friendship throughout the Empire which was encouraged by comradeship in arms.

In the miscellaneous debate which followed on the Consolidated Fund Bill the matter of most general interest was the action of the Government with regard to spies and alien enemies. The Home Secretary explained that while his Department was generally regarded as responsible for public safety throughout the country, he had no real power outside the metropolitan area. In this, since the war began, 120,000 cases of suspicion had been investigated, 342 persons interned, and 6,000 houses ransacked. Complaints had been made of favouritism towards Baron Schroeder and other wealthy Germans, but had the Baron not been naturalised his firm, the largest accepting house in the City, would have closed its doors, and there would have been a great commercial disaster. To lock up all Germans and Austrians, as some people desired, might lead to reprisals, and many of them were only technically foreigners. On the question of internment, the military authority was the decisive authority under the Hague Conventions. The really dangerous spies were those of British nationality.

The spy peril had been dealt with in the other House on the previous day (Nov. 25). The Earl of Crawford then admitted that much had been done since his last speech (p. 231), but the complaints in it had been substantiated, and a clear statement should be given of the legal responsibilities of the authorities concerned, and the policy of the Government should be codified and simplified. Lord Leith of Fyvie complained that money was coming from German sources to Germans in Great Britain, that favouritism was being shown to rich enemy aliens, and that coal was being supplied to German warships from the West of Scotland and Ireland. The Lord Chancellor asked for concrete instances, stating that there was no evidence of these supplies, explained the distribution of powers between the Home Office, the War Office, and the Admiralty, who were closely co-operating, and said that cases of espionage were being carefully followed up, but the difficulty of defeating it was enormous, and the worst offenders were probably English.

But the most interesting part of the proceedings in the Upper House was the further statement (Nov. 26) by Earl Kitchener on the progress of the war in the past six weeks. He mentioned that the delay caused by the British expedition to Antwerp in the release of its German besiegers just gave Sir John French time to prevent the Germans reaching the northern coast of France; that the British cavalry divisions, extended for seven miles of front in trenches, threw back the fierce attacks of a German Army Corps for more than two days; that Sir John French's position was attacked at one time by eleven army corps, and that on November 11 a supreme—but unsuccessful—effort was made by the Prussian Guard to force its way through the British lines, and carry them at all costs by sheer weight of numbers. The British troops before Ypres, after fourteen days and nights in the trenches, had been relieved by French reinforcements, and several Territorial battalions had joined. The British losses, though heavy, were slight in comparison with the German. He acknowledged the "tenacity and endurance," and the high fighting qualities of the French Army, and the pluck and gallantry of the Belgian Army and the King, and he mentioned that on the Eastern front the Russians had checked and defeated the Germans, inflicting on them heavier losses than they had ever sustained before. After referring to the operations against Turkey, he said that the publication of news must be governed by the needs of the French Army, the larger force, but the Government desired to keep nothing back which could not be utilised by the enemy. The difficulties of providing and equipping the new Army were being successfully met, and he felt confident that further calls on the manhood of England would be responded to in a manner and spirit which would ensure the prosecution of the war to its successful conclusion. Later, Earl Kitchener said that recruits were coming in at the rate of 30,000 weekly besides the regiments then being formed by different localities; and the Lord Chancellor promised that information should be given in the future as to the action of civilians during invasion.

On the Report of the War Loan Obligations Bill next day (Nov. 27) important statements were made by the Chancellor of the Exchequer and the First Lord of the Admiralty, reviewing the financial and naval position respectively. The former said that the Government had taken unprecedented responsibilities in the interest of the mechanism of international trade. In the Napoleonic wars practically all the countries were self-contained; Great Britain's total imports and exports amounted in value to some 86,000,000l.; in 1912 their value exceeded 1,400,000,000l. The international trade in the Napoleonic wars amounted to perhaps 200,000,000l.; in 1913 it was valued at 3,000,000,000l., and Great Britain provided the capital to raise and move the produce, and carried half the produce, of the world. Transactions between merchants in China and the United States, for instance, were paid for by bills of exchange on London. Very little of the business was done with gold; London in 1913 received 50,000,000l. in gold and paid out 45,000,000l. All this delicate paper machinery crashed into a war affecting two-thirds of the world. There was inevitable confusion, and a deadlock, due to a failure of remittances from abroad to cover bills representing 350,000,000l. to 400,000,000l. There was a complete breakdown of the exchanges, as if a shell had broken an aqueduct; Argentina owed Great Britain 400,000,000l., but the latter could not buy a single cargo of frozen meat. Had the machine been left broken, the general distress in Great Britain would have been unutterable. The Government had to save British industry, commerce, and labour. They had invited the assistance of men of great experience, and eventually had set up a permanent advisory Committee. He acknowledged the great assistance rendered by Mr. Chamberlain, Lords St. Aldwyn and Revelstoke, and the Lord Chief Justice, the latter, with Sir John Bradbury, constituting a Court of Appeal. They decided that something must be done at once to avert a run on the banks, and declared a limited moratorium, and then decided to advance to the banks Treasury notes up to 20 per cent. of their deposits. At first the banks availed themselves of this currency facility to the extent of 13,000,000l.; the sum outstanding was only 244,000l. The currency notes of 1l. and 10s. outstanding amounted to 33,892,000l., 25,696,000l. being in 1l. notes. Next, the Government guaranteed the payment of all bills accepted by British houses, giving them a reasonable time to collect them. Great Britain had assets of some 4,000,000,000l. of good foreign securities, and some 13,000,000,000l. worth of collieries, mines, factories, etc., at home; to allow its credit to remain doubtful for some 350,000,000l., all or nearly all owing to British subjects, would have been criminal. By these three steps the unimpeachable character of the British bill of exchange had been guaranteed, and a financial catastrophe, probably without parallel, avoided. But they had to discriminate between bills, and experts could do so instinctively; and for this reason facilities had been partly refused in the case of Mr. Crisp, of which Sir A. Markham (L., Notts) had complained earlier in the debate. Only one member of an accepting house had been on the Committee of the Bank of England which examined the bills, and his business was with a neutral country. They discounted 57,000l. of Mr. Crisp's bills, but as collateral security for another 200,000l. he tendered only securities worth 72,000l. Only 50,000,000l. of bills, or about one-ninth of the total, would have to be put aside as dealing with belligerent countries or for analogous reasons. The loss would depend on the length and the issue of the war. Before ending the moratorium they had to consider: (1) the business specially affected by the war, such as the Scottish fishing industry, whose case they met by the Courts (Emergency Powers) Bill (p. 196); (2) the restoration of the foreign exchanges, which they effected by restoring the old-machinery, releasing the endorsers and drawers of Bills, and retaining simply the liability of the acceptors; (3) the restoration of the Stock Exchange, where the difficulty was that 70,000,000l. or 80,000,000l. of securities were hypothecated in respect of debts incurred before the war began. Had the banks pressed for these debts, the securities would have been placed on the market, their value would have been deplorably reduced, and the State, now the sole borrower, could have raised money only at incredible rates. The Government had left the banks to make their own arrangements with the Stock Exchange, but had agreed to advance 60 per cent. of the value of the securities on July 29 on condition that the banks undertook not to put their securities on the market till six months after the war; and had arranged that the Stock Exchange should only open with the sanction of the Treasury and under conditions to be imposed by it in the public interest. Not one application had been made for Government credit, either in respect of this arrangement or of a similar guarantee through which the Liverpool Cotton Exchange had been reopened. Provincial traders who had been sending goods to the Continent on credit, without receiving bills of exchange, had been promised Government assistance to the extent of 50 per cent. of the credit value of the interest, on condition that the local banks, who knew their men, undertook 25 per cent. Applications amounting to 16,000,000l. had come in in respect of these debts, and the Government hoped to do something at the earliest possible moment. Britain was still supreme in international commerce, its money market was better than any other, the gold at the Bank had risen during the war from 26,000,000l. to 85,500,000l. and they had raised in all 440,000,000l. with the Stock Exchange closed. The loan of 350,000,000l. (p. 236) had been over-subscribed, and there had been nearly 100,000 applications for small amounts, so the sum had been raised without any of the German expedients for raising a smaller loan at a higher interest. Unemployment had gone down, confidence had been restored, British credit had stood the strain, the market had been less affected than any in the world. The raising of the loan gave him confidence that British credit was built on foundations that no foreseeable contingency could destroy.

In the subsequent debate Mr. Austen Chamberlain paid special tributes to the services of the Bank of England, its Governor, its ex-Governor (Mr. Cole), and Lord Revelstoke; the President of the Board of Agriculture gave particulars of a proposed scheme for the manufacture of aniline dyes, hitherto made exclusively in Germany—the consumers to subscribe 3,000,000l., the Government, subject to certain conditions as to control, to guarantee debenture interest on another 1,500,000l.; and Mr. Bonar Law endorsed this scheme and criticised, in moderate terms, the recent purchase by the Government of 18,000,000l. worth of sugar, and the total prohibition of the import of sugar in consequence. The Home Secretary explained that the sole aim was to prevent sugar coming from neutral countries and being replaced there by German sugar. The Bill was subsequently read a third time.

On the adjournment, Lord Charles Beresford (U.) commented favourably, on the whole, on the naval position. The First Lord of the Admiralty, in reply, said that it was useless to discuss particular incidents, such as the battle off Chile, the loss of the Aboukir and her consorts, and the expedition to Antwerp, without the disclosure, at present impossible, of all the orders and the entire situation. The only rule as to publishing information was that the publication should not interfere with the operations of the war; and he expressed the gratitude of the Admiralty for the reserve shown by the Press. The incidents seen were a very small part of the work going on all over the world. The British Navy had been confronted in the event of war by four main perils—(1) surprise before it was in its war stations [which had been averted by the assemblage at Spithead]; (2) the escape of fast armed liners of the enemy, but only 1.9 per cent. of the mercantile marine had been lost, against an estimate before the war of 5 per cent.; (3) mines, but the limits of that danger could now be discerned and it was being further restricted and controlled; (4) submarines, a novel and very grave danger, but British power in submarines was far greater than German, and the only reason it could not produce greater results was the rarity of a target for attack. A fifth danger, oversea invasion, he dismissed curtly as an enterprise perilous for the invaders. Of British shipping 97 per cent. was plying, of German shipping less than 11 per cent. was plying or unaccounted for, and only ten German ships, it was believed, were trading on the seas, while the Germans were becoming deficient in war material. The results of the German policy of attrition so far were not unsatisfactory to Great Britain. The losses of submarines had been equal, but the German loss proportionately was much larger, the British vessels being more numerous; of destroyers, the British loss was nil, the German eight or ten; of the older armoured cruisers, it was six to two, but the British were three or four times more numerous, and therefore more frequently exposed to attack; in fast modern light cruisers,—the most important class of modern vessels,—the proportion had been 36 to 25; Britain had lost one-eighteenth, Germany one-fourth. The British additions, recent and future, would make the British strength beyond comparison greater. In Dreadnoughts British superiority at the start was just under 60 per cent.—36 to 21; by the end of 1915 Germany could not possibly have more than three besides; Great Britain should have fifteen, including two taken over from Turkey, and one from Chile, and could afford to lose a super-Dreadnought a month and yet be in about as good a position as at first. There was no attrition by wear and tear. The health of the Fleet was twice as good as in time of peace, and the conduct of the men almost perfect. There was no reason whatever for nervousness, anxiety, or alarm. We had powerful Allies on the seas, but, even were we single-handed indefinitely, we might go on drawing our supplies and transporting our troops as we pleased.

After a short speech of concurrence from Mr. Bonar Law the House adjourned till February 2.

The war legislation passed in the first instalment of this new Session included Bills to consolidate and amend the Defence of the Realm Acts, based on the experience gained during the war; providing pensions for soldiers and their dependants; enacting that acceptance of a commission in the Army or Navy ["office under the Crown"] by members of the Commons should not vacate their seats; providing that members of local authorities should not be disqualified by absence, if they were on naval or military service; facilitating land drainage (as a means of employment); and, notably, amending the Trading with the Enemy Act. This last measure set up a custodian of enemy property in the person of the Public Trustee (in England and Wales; other arrangements were made in Scotland and Ireland) to whom must now be paid all dividends, interest, or share of profits which would otherwise have gone to an alien enemy, for him to hold till after the war, The Bill contained also provisions against the transfer of enemy claims, or stock or shares, to neutrals, and against the transformation of German into British companies; and it made even an offer to trade with the enemy a criminal offence.

About ten days before the adjournment, the work of recruiting for the new armies had been facilitated through the commencement of the issue by the Parliamentary Recruiting Committee (representing all parties) of a circular to every householder in the United Kingdom, asking for the names of such members of the household as might be able to enlist.

Meanwhile, the war had been going well for Great Britain. The Germans had clearly been foiled in their attempts to break through in Flanders; Zeebrugge was heavily bombarded by a British squadron (Nov. 23) consisting of three small cruisers and some destroyers and torpedo boats, with the effect, it was hoped, of destroying the German preparations for its use as a base for submarines. The British positions before Ypres had been held, and the floods between Dixmude and Nieuport had rendered a German advance there impossible. In the Vosges the French were advancing slightly, elsewhere they were holding their own. A daring air raid on the Zeppelin airship factory at Friedrichshafen had been undertaken from French territory (Nov. 21) by Squadron Commander E. F. Briggs of the Royal Naval Air Service, with Flight Commander J. T. Babington and Flight Lieutenant S. V. Sippe, who dropped bombs on the factory under heavy fire, and, it was believed, did, considerable damage. Commander Briggs was wounded and captured; the others returned safely. (This startling raid of 250 miles, 120 of which were in enemy territory, caused a complaint from the Swiss Government that Swiss territory had been violated, a contention which the British Government denied.) Even more encouraging was the news from the Persian Gulf that the British and Indian troops which had landed at the mouth of the Shatt-el-Arab, after defeating the Turks on November 15 and 17, had occupied Basra on the 21st, only seventeen days from the declaration of war. At sea the large German submarine U 18 was rammed by a British patrol vessel, surrendered, and sank (Nov. 23). On the other hand, it was disquieting that a German submarine should have sunk two merchant vessels near Havre at three days' interval; and the terrible explosion of the Bulwark (p. 239), though the ship was almost obsolete, reduced the personnel of the Navy by some 750 men.

The confidence of the British military authorities was exhibited by the visit paid to the troops at the front by the King—the first such visit by a British monarch since George II fought at Dettingen in 1743. On Sunday, November 29, His Majesty crossed to France in a warship; he was met by the Prince of Wales on landing, and next day, after inspecting some of the base hospitals (including one for Indian troops) he reached the British general headquarters. During the three ensuing days (Dec. 1-3) he made a tour of the Army Corps, visiting their headquarters, meeting the generals and staffs, and inspecting all the troops not in the trenches, who were lined up, in large or small bodies, to greet him as he motored past. On December 1 he visited the Fourth Army Corps, and met President Poincaré, M. Viviani (the French Premier), and General Joffre, who accompanied him in his inspection; the last named he invested with the G.C.B., the two former dined with him. On December 2 he visited a Cavalry Corps and the Third Army Corps, and invested several French officers with British orders; on December 3 he invested Sir John French with the Order of Merit, inspected the First and Second Corps and some cavalry, and obtained a view of the battlefield, including Lille, Roubaix, and Ypres, where shells were bursting. On December 4 he made himself acquainted with the work of various departments of the Staff and of the auxiliary services; and he visited the Belgian headquarters and met King Albert on the last fragment of Belgian territory still unoccupied by the invader. On December 5 he saw the work of other auxiliary services, and visited the headquarters of the Royal Flying Corps. Throughout his visit this corps had "carried out a continuous aerial patrol" above him. That night he returned to England.

Before leaving, His Majesty issued a special order to the Army as follows:—