such war costs should be excluded. On the other hand it was
agreed that pensions might properly be made part of Germany's reparation
bill. The two items of damages and pensions were calculated by the
American experts as amounting to a total figure of not less than
$30,000,000,000 present capital sum, which Germany ought to pay.

The next step was to determine how much Germany could be made to pay. By
drafting too severe terms German trade might be destroyed completely and
Germany left without the economic capacity to make the money that was to
pay the bill. It was obvious to careful students that the total amount
which she could turn over to the Allies could not be much more than the
excess of her exports over imports; and that even if payments were
extended over twenty or thirty years their value for purposes of
reparation would probably not much exceed twenty-five billion dollars.
Lloyd George in his election pledges had promised that the complete
reparations account would be settled by the enemy; neither he nor
Clemenceau dared to confess that the sum which could be exacted from
Germany would fall far below their early promises. The British experts,
Sumner and Cunliffe, continued to encourage Lloyd George in his belief
that Germany could afford to pay something in the neighborhood of a
hundred billion dollars, and the French Finance Minister, Klotz, was
equally optimistic. At first, accordingly, Allied demands on Germany
seemed likely to be fantastic.

The Americans, on the other hand, were infinitely more conservative in
their estimates of what Germany could pay. Even after certain Allied
experts, including Montagu and Loucheur, affirmed the necessity of scaling
down the suggested sum of reparations, the difference between the
American proposals and those of the Allies was serious.[13] Political
considerations, however, interposed, and preventing the settling of a
definite total sum which Germany must pay. Neither Lloyd George nor
Clemenceau dared to go to their constituents with the truth, namely that
Germany could not possibly pay the enormous indemnities which the
politicians had led the people to expect. (Lloyd George, for example, had
stated the sum that Germany must pay at about $120,000,000,000.) Both the
chiefs of state asserted that they were almost certain to be turned out of
office as a result, with consequent confusion in the Peace Conference, and
a prolongation of the crisis. The only escape seemed to b