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At this stage came the Young Turk revolution and its sequel, the annexation of Bosnia. To any impartial observer it had been obvious from the first that those who dreamt of Austria-Hungary's voluntary withdrawal from the two provinces were living in a fool's paradise.

The break-up of the Balkan League was the first condition to that Austrian advance on Salonica which has always remained the ideal of the advocates of a forward policy in Vienna and Budapest, and which lies at the root of Austria-Hungary's action in provoking the present war. Serbia and Montenegro, however, are but one half of the problem.

The more important passages of the despatch run as follows: "The last two days have passed in the expectation of events which are bound to follow upon Austria-Hungary's declaration of war against Serbia. The most contradictory reports were in circulation, without any possibility of confirming their truth or falsity.

A large proportion of her population is anti-German, or at least non-German, and Italy is always subject to be tempted by an opportunity of obtaining some of Austria-Hungary's Adriatic possessions. Moreover, a large party is even now to be found in Austria-Hungary which desires revenge for the humiliation of her defeat by Germany in 1866.

I then told him that the guilt for the measureless consequences lay at the door of premature mobilization against Austria-Hungary which after all was involved merely in a local war with Servia, for Germany's answer was clear and the responsibility rested upon Russia which ignored Austria-Hungary's assurance that it had no intentions of territorial gain in Servia.

Telegram of the Imperial Ambassador at Vienna to the Chancellor on July 24th 1914. Count Berchtold has asked to-day for the Russian Chargé d'affaires in order to explain to him thoroughly and cordially Austria-Hungary's point of view toward Servia.

The mistake our Government made was to consent to Austria-Hungary's making so daring an experiment, at a moment of such critical tension. It is not true either that we were thoroughly equipped and prepared for war. We had neither sufficient supplies of munitions, foodstuffs and raw materials, nor any plan of campaign for a war with England.

And when Austria-Hungary's southern neighbour joined the ranks of the enemies of the Central Powers her first step was to declare a blockade of all the coasts of her opponent following the example, of course, of her Allies in disregard of the legal precepts which Italy had shortly before helped to lay down.

The issues involved are wider and deeper than the quarrels of Vienna and Budapest with Belgrade. Even if every man in Serbia were willingly prostrate before the Habsburg throne, there could be no real peace until the internal problem of Austria-Hungary's Southern Slav provinces is solved.

But this is not all: France has a foreign trade amounting to £615,000,000 a year; Belgium's is valued at £326,000,000, Russia's at £275,000,000, and Austria-Hungary's at £256,000,000. Besides a gigantic foreign trade there is a domestic trade, which is on a larger scale than the external trade of these countries. Let us consider in more detail the case of Germany.