How long could the Allies have lasted WW1?

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Britain's finances were not strong enough to finance both her own effort and France's out of pocket. France was pretty much broke by 1917 and had next to no resources to fight a modern war. Though possessing a large war industry at this point, the resources to turn out artillery, munitions, and small arms all had to be brought in. This also is true for nitrates, both for munitions and farm production. On top of this food still needed to be shipped in. Capital had fled Britain, France, and Russia by this point and the only nation outside the CPs that had the wealth necessary to fund the war was the US.

Britain never funded the war out of pocket. It was always funded out of pocket. This was possible because of the strength of British credit. It's important to stress the strength of British credit: it made it cheaper to buy war material from the US than to make it in Europe.

Britain had vast overseas assets that could be offered as security, the war only cost about 14% of those. If the US had stayed neutral these remaining assets would have been demanded as security.

Britain would be in no position to refuse but neither would the US: otherwise all the existing loans would be worthless, as they were dependent on British creditworthiness.

Economically speaking the US was in for a penny, in for a pound from much earlier.
 
Honestly I don't see Bethmann surviving too long into 1917 when Falkenhayn is ready to cut a deal and Bethmann is still trying to get him fired. One of them has to go and given the scenario it isn't Falkenhayn.

Deal with whom? There's nodody else - except Ebert and the SDP, both unacceptable for F. and the Kaiser. Keep Bethmann, who has a lot of flaws but still has a good feeling for a reasonable course - or get some nobody like Michaelis, who has no clue what's going on at all.
 

Deleted member 1487

Britain never funded the war out of pocket. It was always funded out of pocket. This was possible because of the strength of British credit. It's important to stress the strength of British credit: it made it cheaper to buy war material from the US than to make it in Europe.
Uh, not sure what you're saying here at all. You contradict yourself repeatedly, first saying Britain never funded the war out of pocket, then you say they did, then you say it was funded on British credit.


Britain had vast overseas assets that could be offered as security, the war only cost about 14% of those. If the US had stayed neutral these remaining assets would have been demanded as security.


Does Britain want to mortgage all their assets on the war or negotiate instead of pawning it all off? And without American loans they will have to loan the French and Russians all the money they need to fight too, something that all their overseas assets probably won't cover.

Britain would be in no position to refuse but neither would the US: otherwise all the existing loans would be worthless, as they were dependent on British creditworthiness.

Economically speaking the US was in for a penny, in for a pound from much earlier.
The US was refusing, that is the point. Hew Strachan covers this in "To Arms" in the foreign finance section of the book. Why would existing loans be worthless and why does the British credit rating matter if the US government doesn't want to link their economy further the the Entente war effort? The entire point of the refusal to make more loans was to prevent the US from getting dragged in the war. Every historian that researches the history of loans from the US to the Entente agrees that the US declaration of war saved the Entente from bankruptcy, and the US did not enter the war over loan issues.
 

Deleted member 1487

Deal with whom? There's nodody else - except Ebert and the SDP, both unacceptable for F. and the Kaiser. Keep Bethmann, who has a lot of flaws but still has a good feeling for a reasonable course - or get some nobody like Michaelis, who has no clue what's going on at all.

Michaelis was malleable and would do exactly what Falkenhayn told him, much as he did under Lundendorff, which was why he was chosen, instead of sabotaging Falkenhayn's peace efforts and trying to get him fired.
Also, why would B-H stop trying to get Falkenhayn replaced ITTL after 1917? Is he suddenly going to realize Falkenhayn was right?

The deal I referred to was a peace deal to end the war.
 
Britain had vast overseas assets that could be offered as security, the war only cost about 14% of those. If the US had stayed neutral these remaining assets would have been demanded as security.

In that case would you mind explaining three things?

1) Why did Britain (through the House of Morgan) try to raise an unsecured loan in November 1916? Its failure did a lot of damage to British credit by triggering a run on Sterling. If other security was available, why not use it?

2) After US entry into the war, why did the US then grant unsecured loans (which might be defaulted on) if plenty of security was still available? Why not insist on secured ones. Britain would have had little choice but to agree. In May 1917 her situation was so bad that she sent Arthur Balfour to America with what amounted to a begging bowl.

3) Why did the British government's financial advisors tell it in Oct 1916 that Britain could remain solvent only until March 31st, and why did the War Cabinet decide, on December 9, that (if unsecured loans were unobtainable) there was no alternative to restricting purchases? Were they somehow unaware of all this further collateral available?

Britain would be in no position to refuse but neither would the US: otherwise all the existing loans would be worthless, as they were dependent on British creditworthiness.

The existing loans would not be worthless, as all were secured on British assets in North America. Unsecured loans would be, but those were not on offer until the US entered the war.


Economically speaking the US was in for a penny, in for a pound from much earlier.

No. It would have been had it started granting unsecured loans, but that was the very reason Wilson would not do so. He did not intend to allow his hands to be tied in that way.

BTW, Uneasiness about unsecured loans went far beyond the ranks of isolationists or pro-Germans. Frex, Robert Lansing, the Secretary of State, was strongly pro-Ally, but when approached by the Governor of the Federal Reserve board, WP Harding, advised that the Board should be "slow to approve unliquid securities with no collateral".
 
Michaelis was malleable and would do exactly what Falkenhayn told him, much as he did under Lundendorff, which was why he was chosen, instead of sabotaging Falkenhayn's peace efforts and trying to get him fired.
Also, why would B-H stop trying to get Falkenhayn replaced ITTL after 1917? Is he suddenly going to realize Falkenhayn was right?

The deal I referred to was a peace deal to end the war.

Falkenhayn had no intention to direct the civil side of the government. He had told Bethmann that the military side was unable to win the war - and that consequently it was up to Bethmann to find a diplomatic way out.
Much more than Ludendorff, F. was aware that he was a pure soldier and had no clue of political and diplomatic matters. - Ludendorff said the same from himself, but nevertheless constantly interfered in politics and diplomatic negotiations. F. did not do this.
So, if Bethmann does not try to get rid of F., and F. will not act against B. anyway, both are remaining in office. Just to the satisfaction of the Kaiser.
 
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Serious question here. Everyone is talking about the Entente having to can the war effort due to financial problems, so how did the central powers survive so long, with a Germany crippled by blockade, the Ottomans being spanked by General Allenby in Palestine and Austria Hungary on it's last legs? Surely the Entente were richer than the CP?
 

Deleted member 1487

Serious question here. Everyone is talking about the Entente having to can the war effort due to financial problems, so how did the central powers survive so long, with a Germany crippled by blockade, the Ottomans being spanked by General Allenby in Palestine and Austria Hungary on it's last legs? Surely the Entente were richer than the CP?

Actually it is the blockade that kept Germany solvent for so long. Capital was not fleeing the nation to buy things from the US, so the CPs could stay in the game longer. Eventually though, even despite borrowing ridiculous sums from the Netherlands, Germany just started having to print money, which by the end of the war devalued the currency and led to the inflation problems of the post war to a degree (not completely or even mostly, but it contributed).

Also, Germany had the war resources to continue to fight and sold significant amounts to her allies. Part of Germany's solvency also derived from her using her allies to prop up the war effort. She basically insisted on payments of gold, so ended up large reserves. Additionally, not having to import resources means she kept the money at home, while the UK and France, as well as Russia (who needed manufactured goods) had to mortgage themselves to ensure they could continue to purchase to sustain their efforts. As I stated before, France literally needed to buy and ship nearly everything for the war effort from abroad. Britain was better off, but was subsidizing her allies' efforts, which meant that she was borrowing for them and also lending from her own coffers. Therefore the effort was inextricably interwoven. Britain cannot fight without France and France cannot fight without loans, so Britain has to make sure France has the money to continue to fight. But by 1917 France was out of money and couldn't raise funds from abroad, as everyone was convinced they would never get their money back.

Allenby's victories in Palestine would occur after the issue of loans becomes a major issue, meaning he might never get to spank anyone, as efforts in the Middle East are reduced to maintain the effort on the continent.
 
Hmm...So the Entente were screwed financially. I need to salvage some pride for them. The British had a good hundred days offensive. Would it be fair to say that without US intervention the Entente would still be odds on to win if, say, Britain found a secret massive gold stash in the highlands, built up from centuries of Scottish tax evasion?:D
 
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Serious question here. Everyone is talking about the Entente having to can the war effort due to financial problems, so how did the central powers survive so long, with a Germany crippled by blockade, the Ottomans being spanked by General Allenby in Palestine and Austria Hungary on it's last legs? Surely the Entente were richer than the CP?


The blockade was a problem, but didn't get really crippling until after the US entered the war, and exports thence to the neutrals bordering Germany could be tightly regulated at source.

The Turks underwent some minor "spankings" in March 1917 (Baghdad) and December (Jerusalem) but after that not a lot happened until October 1918, when the entire Central alliance was falling to bits.

As for Austria-Hungary, she had been "on her last legs" for a remarkably long time. That was her perennial plea whenever she wanted German help. Yet she too plugged on into Oct 1918. It's roughly the converse of the old joke about Brazil, that she is "the land of the future - and always will be". A/H was always supposedly on the point of collapse, but somehow it never seemed to happen as long as the CP retained a chance of winning.
 
Actually it is the blockade that kept Germany solvent for so long. Capital was not fleeing the nation to buy things from the US, so the CPs could stay in the game longer. Eventually though, even despite borrowing ridiculous sums from the Netherlands, Germany just started having to print money, which by the end of the war devalued the currency and led to the inflation problems of the post war to a degree (not completely or even mostly, but it contributed).

Also, Germany had the war resources to continue to fight and sold significant amounts to her allies. Part of Germany's solvency also derived from her using her allies to prop up the war effort. She basically insisted on payments of gold, so ended up large reserves. Additionally, not having to import resources means she kept the money at home, while the UK and France, as well as Russia (who needed manufactured goods) had to mortgage themselves to ensure they could continue to purchase to sustain their efforts. As I stated before, France literally needed to buy and ship nearly everything for the war effort from abroad. Britain was better off, but was subsidizing her allies' efforts, which meant that she was borrowing for them and also lending from her own coffers. Therefore the effort was inextricably interwoven. Britain cannot fight without France and France cannot fight without loans, so Britain has to make sure France has the money to continue to fight. But by 1917 France was out of money and couldn't raise funds from abroad, as everyone was convinced they would never get their money back.

Allenby's victories in Palestine would occur after the issue of loans becomes a major issue, meaning he might never get to spank anyone, as efforts in the Middle East are reduced to maintain the effort on the continent.

I think another major contribution was that Germany essentially borrowed from its own population by Kriegsanleihen rather than foreign debt as the Allies obviously did?
 
I think another major contribution was that Germany essentially borrowed from its own population by Kriegsanleihen rather than foreign debt as the Allies obviously did?

Yes(after reading a lot of propaganda poster of the CP), the main capital source for the central powers was their own population, War bonds of 5% of interest for the case of Osterreich-Magyar, direct national charity for the ottomans, the Vivat ribbon,War bonds, the gigant hindenburg of Irons Nails and a long etc fot the Kaiserreich Deutchland. They ginance with thenselves and the lack of big foreing exportation make the liquid for a long time.

And I hate the Cliche who A-H is always a curmbling Empire, that must be added as a cliche, the problem of A-H in the last phase of the war was a combination of foreign sabotage in the promise for the minorities(who only want better cultural rights) to try to crumble, when the Entente collapse as the Scenario try to make(they will not survive the winter of 1917 without the USA a,d if they try to make an offensive in 1918 can be worse than the Kaiserslacth), the nationality will plead for more right as a war reward..

Again, i think without USA, the entente is doomed both finnacial and military in 1918, and without USA, germany will launch their offensive in high summer with almost all they can do(or maybe try to defeated Italy for good)
 

Deleted member 1487

Hmm...So the Entente were screwed financially. I need to salvage some pride for them. The British had a good hundred days offensive. Would it be fair to say that without US intervention the Entente would still be odds on to win if, say, Britain found a secret massive gold stash in the highlands, built up from centuries of Scottish tax evasion?:D

Britain can continue to fight even without US loans, the problem is that France and Russia cannot. Its kind of pointless to stay in the war for Britain if she has no allies and no place for the BEF to fight. She might then be forced to leave the continent and 'spank' the Ottomans to salvage pride and ensure some gains in the war. The logistics were so terrible in the Ottoman Empire that the Germans won't be able to send an expeditionary force of enough size to turn the tide, nor will they be able to send enough supplies to save any part of the empire but the Turkish core provinces.

However a peace deal with France will probably force Britain to the table, so she won't really have the opportunity to really stick it to the Ottomans. Though I am curious what the peace deal would look like the the Turks, as the Germans cannot really get them a better deal than accepting the situation at the end of 1917.
 
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