1921.05.05 “The Neutral Definition”
by Elmer Andrews Bushnell (1872-1939)
18.5 x 23 in, ink on paper
Coppola Collection
Bushnell, an Ohio native, first worked for the Cincinnati Post for several years, before working for the Cincinnati Times-Star. He then joined a newspaper syndicate. He also worked for the New York Globe and the New York Journal.
The London Ultimatum.
After World War I, the Allied powers established the Reparation Commission, tasked with determining and securing the reparations Germany owed under the Treaty of Versailles.
In January 1921, they initially set the total sum at 226 billion gold marks. However, Germany resisted this figure, proposing a lower counteroffer of 30 billion.
In April 1921, the Reparation Commission reduced the amount of damages due from Germany to 132 billion gold marks, which was approximately $31.5 billion. A payment schedule was then presented, requiring Germany to make an initial payment of US$250 million within twenty-five days and subsequently US$500 million annually, alongside 26% of the value of German exports. Germany was also required to issue bonds at 5% interest and establish a sinking fund of 1% to support the payments.
To enforce these demands, the Allies issued the London Ultimatum on May 5, 1921. This ultimatum gave Germany six days to accept the Schedule of Payments and comply with other demands, including disarmament and the extradition of German "war criminals". Failure to comply would lead to the occupation of the Ruhr region.
When Germany defaulted on a payment in January 1923, France and Belgium militarily occupied the industrial Ruhr region to seize the resources they were owed. This occupation was met with passive resistance from German workers, exacerbating Germany's already dire economic situation and leading to hyperinflation.
