because they could not procure the requisite capital. The number of assisted unemployed was in February 125,783; it sank gradually to the half of this figure in June, then rose again, reaching 115,601 in November. These figures would have been far higher but for the relief works undertaken by the municipality of Vienna, which constructed a water-power station in Opponitz, electrified the city railway, and erected workmen's dwellings.

In 1924 there was again a very heavy adverse trade balance -nearly 1,000,000,000 crowns. To avoid the necessity of importing coal the Government proceeded energetically with the development of water-power. From 1921 to 1924 150,000 H.P. of water-power was made available, and at the end of 1924 works for providing additional 70,000 H.P. were under construction. In this way 800,000 tons of coal were saved. The municipality of Vienna was further able to lower the price of the electric current, and so reduce costs of production for Viennese industry.

A decisive improvement in the trade balance can be brought about only by a very appreciable increase in exports. The Government seeks to attain this end, as far as lies in its power, by concluding commercial agreements which will, as far as possible, remove the barriers in the way of Austrian exports. In 1924 a series of such agreements was again concluded: with Germany, England, France, Latvia, Sweden, Norway, Czechoslovakia, and Turkey. In order to smooth the course of the negotiations a new Customs tariff, adapted to Austria's requirements, was drawn up to come into force at the beginning of 1925. It was already made the basis of the negotiations with Germany and Czechoslovakia, and will also serve as a basis for those with Denmark, Holland, Yugoslavia, Greece, and Spain.

Among the Bills which the Government has submitted to the National Council in accordance with its agreement with the Finance Committee of the League of Nations, is one for keeping accounts in shillings and one for making out balance sheets in gold values. The first of these will do away with the host of ciphers which hitherto have concealed the value of Austrian money, while balance sheets in gold values will reveal the true value of Austrian undertakings.

In its programme of reform and reconstruction the Austrian Government had pledged itself to dismiss 100,000 State officials. By the end of November, 1924, 71,352 had been dismissed, besides 9,948 employees of the Southern Railway, the employees of which were not servants of the Government at the time when the programme was drawn up. At the League of Nations meeting in September, 1924, the wish was expressed that the retrenchment in the Civil Service should be carried out more rapidly, and the Government has drafted a new Bill with this object in view.

CHAPTER V.

UNION OF SOVIET SOCIALIST REPUBLICS-ESTONIA-FINLANDLATVIA LITHUANIA-POLAND-CZECHOSLOVAKIA-HUNGARY -RUMANIA — YUGOSLAVIA - TURKEY-GREECE-ALBANIABULGARIA.

UNION OF SOVIET SOCIALIST REPUBLICS.

ON January 21 at 6.15 P.M., after a protracted illness, Lenin, the creator and chief director of the Soviet State, died in Gorki, near Moscow. The impression produced by this event was profound and widespread, and its political effects have been farreaching in the internal affairs of Russia during the year. The anniversary of Lenin's death was declared a day of mourning. M. Rykov, the lieutenant of Lenin in the Council of People's Commissaries of the Soviet Union and also in the Council of Labour and Defence, was elected President of the Council of People's Commissaries. The Vice-Presidents of the Council were M. Kamenev, who also held the post of President of the Council of Labour and Defence, M. Tziurupa, who was at the same time Head of the Economic Committee, M. Orkhelashvili, and M. Tschubar. Other prominent members of the Council were M. Tchitcherin, M. Trotski, and M. Krassin, who was later replaced by M. Scheinmann. M. Dserjinski was appointed President of the Supreme Economic Council.

The real rulers of the Soviet Union since Lenin's death have been M. Kamenev, M. Zinoviev, Head of the Leningrad (formerly Petrograd) Commune, and M. Stalin, Secretary of the Russian Communist Party-the so-called "triumvirate.'

The Second Session of the Congress of the Soviet Union (the Parliament) met in February, and elected the Central Executive Committee of the Union of the Soviet Republics. This Committee consists of two Chambers, viz. (1) the Council of the Union with 414 members, and (2) the Council of Nationalities with 100 representatives of 32 Republics and autonomous districts. The Chairmen are M. Kalinin (for Soviet Russia), M. Petrovski (for the Ukraine), M. Narimanov (for the Transcaucasian Federation), and M. Tcherviakov (for White Russia).

During the year two new autonomous Republics have been formed, the Republic of the Germans on the Volga, and the Moldavian Republic.

The Thirteenth Congress of the Russian Communist Party, held in June, was the outstanding feature in the internal affairs of the Union, for there occurred the decisive clash between the two groups which ever since the illness of Lenin had been struggling for mastery, the one comprising the majority of the party, headed by the aforenamed triumvirate, and the other including Trotski, Preobrajenski, Sapronov, and others. During the first half of the year drastic measures were taken to suppress the middle class, the chief victims being the children of the

bourgeoisie who were denied the right of attending the "middle" schools and the universities. The bourgeois were even deprived of the right of voting in the House Committees in questions concerning the disposal of their own flats. The Communist Congress voted unanimously for Leninism against petty bourgeois tendencies. The N.E.P. (New Economic Policy) was strongly condemned, although not abolished. The Congress did not demand the entire suppression of private commerce, but urged that it should be curtailed in favour of State trade and cooperation. Trotski was opposed to this policy, but voted nevertheless for the resolutions of the majority, on the principle of "my Party, right or wrong." He was elected a member of the Central Committee of the Party, but his conflict with Zinoviev and the other leaders of the majority still went on. In autumn he published a book "1917" in which he showed that in that decisive year he had been with Lenin against Zinoviev, who had been opposed to the idea of seizing power. Zinoviev, argued Trotski, had failed then, and he could fail again to-day. The whole book is meant to support the view of Trotski, that the democratisation of the party is the only way to save the party. The issue was exhausted in a few days. The book was not prohibited by the authorities, but countless resolutions were passed against the author in all Soviet districts and party clubs. By the end of the year the Trotski crisis was not yet over. Rumours were spread of his being ill and having undertaken a new trip to the Caucasus for reasons of health.

The Conference of the Third International held in Moscow in July was significant in many ways. A resolution was adopted that only with the consent of Moscow should the national Communist Parties be allowed to convoke ordinary and extraordinary congresses. This resolution strengthened the position of Moscow in the Third International. M. Radek, one of the most prominent members of this body, was not re-elected on the Executive on account of his moderate views with regard to revolutionary action in Germany.

M. Savinkov, a prominent leader of the counter-revolutionary movement and former Minister of War in the Cabinet of M. Kerenski, who has for years been fighting against the Bolsheviks, crossed the Polish-Russian frontier on August 20. He was arrested on Russian territory and brought to trial. Before the Court he declared his readiness to recognise the Soviet power. He was condemned to death, but the Central Executive Committee commuted the sentence to one of imprisonment for ten years.

In foreign affairs the outstanding events have been the recognition of the Soviet Government de jure by Great Britain, Italy, France, and several lesser European States, and the further expansion of its diplomatic influence in Asia. Recognition came first from Great Britain, in a Note despatched on February 1 by Mr. Ramsay MacDonald to Moscow. This was

followed by the visit of a Russian delegation to England, by the Anglo-Soviet Conference in London, and by the Anglo-Russian Treaty which was signed by Mr. MacDonald on August 8 and repudiated by Mr. Chamberlain on November 21. (For a full account of these events vide English History, passim, and for the text of the Treaty vide under Public Documents.)

Even before the British recognition, negotiations had been carried on in Rome between the Russian Trade Delegation and the Italian Government with the object of concluding a Treaty of Commerce and Navigation. At the final meeting of the Conference, held on January 31, M. Mussolini declared that with the conclusion of the Treaty the question of the de jure recognition of the Soviet Government by Italy was settled in the affirmative. On February 7 normal diplomatic relations between the two Governments were resumed, and an Italian Ambassador sent to Moscow. The Russo-Italian Treaty did not touch on the questions of Russian debts and compensation for the damage caused to Italian citizens during the upheaval in Russia. This damage has been estimated at 3 milliards of lires. The Soviet Government has, however, pledged itself to secure to Italian interests the most favourable treatment possible. The Treaty contains besides a clause that no Soviet propaganda should be carried on in Italy.

In Russia the sensation of the year was the recognition of the Soviet Union by France. Shortly after M. Herriot had assumed office the question was discussed in the French Cabinet, and a Commission under Senator de Monzie was appointed to inquire fully into the matter. On October 29 a telegram was sent by M. Herriot to Moscow which stated that, faithful to the friendship which united the French and Russian nations, the French Cabinet had decided to recognise the Soviet Government as the de jure Government of the former Russian Empire, and diplomatic relations should, therefore, be resumed. In the Russian Note, signed by Kalinin, Rykov, and Tchicherin, great satisfaction was expressed at this démarche of the French Premier. The French formula of non-interference in the internal affairs of each country was readily accepted by the Soviet Government. In an interview granted on November 4 by M. Herriot to M. Rakovsky, who had come from London to take over the palais of the former Russian Embassy in the Rue Grenelle, it was agreed that M. Krassin should be the Soviet Ambassador in Paris and M. Jean Herbette should go as French Ambassador to Moscow. On December 12 M. Krassin presented his credentials to M. Doumergue, President of the Republic. Negotiations between Krassin and Senator de Monzie were opened at once, but no results had been achieved when the year closed. According to the French newspapers, the pourparlers have not been satisfactory.

Relations with Germany were strained for some little time, owing to the raid made in the spring by the Berlin police on

the offices of the Russian Trade Delegation in the Lindenstrasse. On May 3 an official of the Delegation, Bozengard, who had been arrested in Würtemberg for carrying on Bolshevik propaganda, was brought by two police officers to Berlin on the way to a prison in Pomerania. Bozengard persuaded them to go with him to a coffee-house in the building where the Delegation was located, and when they arrived there he escaped. The police officers were detained, and only released after strong protests. The Berlin police then arrived and made a domiciliary visit. Five officials of the Delegation were arrested. The Russian Ambassador in Berlin, M. Krestinski, protested against the violation of the extra-territoriality of the Russian Trade Delegation, and left Berlin for Moscow, while the Trade Delegation closed its doors. The news of this incident was received in Moscow with great anger. On May 11, on the occasion of the unveiling of a monument to Vorovski, the Russian diplomatist who was murdered a year previously at Lausanne, M. Tchicherin made a speech in which he spoke of "the bandit raid of the German police;' " and this was followed by anti-German demonstrations. Diplomatic intercourse with Germany was broken off, and the rupture lasted for nearly three months. Several Notes were exchanged between Moscow and Berlin, and a settlement was at last reached on July 29, and embodied in a protocol signed by Dr. Stresemann and M. Bratmann-Brodowski, the Russian Chargé d'Affaires. In its first Note the Russian Government had demanded that Germany should make a solemn apology to Moscow, punish the guilty officials, and declare that the offices of the Trade Delegation enjoyed the right of extraterritoriality. The protocol of July 29 only partly met the wishes of the Soviet Government. No solemn apology was made, the extra-territoriality was conceded to certain departments of the Trade Delegation only, and the punishment of the guilty police officials was promised in vague terms. The Soviet on its side had to forbid its officials of the Trade Delegation to take any part in the political life of Germany. In paragraph V. both Governments expressed their willingness to conclude a Trade Agreement within a year after the signing of the protocol. Negotiations to that end were opened in November in Moscow, but had not been concluded at the close of the year.

The Soviet Union was recognised de jure by Norway in February, by Sweden in March, by Denmark on June 18, and also by Greece; with Sweden and Norway Trade Agreements were also concluded. Negotiations with Holland have not led to any result as yet. An Agreement has been signed in Berlin between M. Krestinski and Hungarian representatives for the establishment of diplomatic and economic relations with Hungary. This Agreement has still to be ratified by both Governments. Negotiations took place between the Soviet Embassy and the Mexican Legation in Berlin which led to normal diplomatic relations being resumed between the two countries. The