November 8, 1917 
LAND & WATER 
war presented itself to many Swedes as a preventive-de- 
fensive war on the part of Germany. To them, nursed in the 
shadow of the ' Russian menace, the Alliance between 
autocratic and expanding Russia and free, democratic Britain, 
in desperate commercial competition with Germany in tlio 
world's markets, seemed an imholy one and incompatible 
with professed solicitude for small nations. 
Those mentally inclined towards Germany saw in the 
" encircling of the Central Empires " a conclusive proof of 
the truth of the case Germany put forward with regard to tlie 
real causes of the war. Some of the most prominent (ierman 
scientists preached their war theses in Sweden, and German 
editors and deputies came there to organise their propaganda. 
One of the most energetic amongst them, the now well-known 
Erzberger, to mention one instance, came and offered exclusive 
personal war cables, arid some leading papers printed his 
glowing descriptions of the great victories on the west. New 
German news agencies were created, which flooded tlio 
Scandinavian editorial offices with telegraphic matter. 
These details arc mentioned in order to explain a widely 
prevailing mood of thought in the first period of the war. 
Those circles here referred to were mainly to be found in tlic 
.surroundings of the Court, among the higher bureaucracy 
and the military. They believed in a short campaign and a 
crushing German victory. What could England do ! w as 
their refrain. The Queen, strong willed, a born princess of 
Baden and a cousin of the Kaiser, was the rallying point for 
these forces and she did not hide her light under a bushel. 
The Crown Prince and tlie Crown Princess, born Margaret of 
Connaught, kept a discreet reticence in accordance with their 
position. They have succeeded in keeping out of the pohtical 
controversy, thus not compromising their future. 
Active Neutrality 
Ditticuhies emerging from the war soon appeared. Tliey 
mainly centred roimd trade questions. A characteristic 
movement greatly disturbed the patriotic harmony. Moved 
by different causes and a false conception of the origin and 
innermost meaning of the war, and undoubtedly spurred by 
strong German influences and German victories, a group of the 
" young blood," mostly Conservatives, began to preacli what 
they so contradictorily' called " active neutrality." Their 
idea was that the time had come to eliminate the Russian 
menace by assisting Germany, liberating Finland and freeing 
the eastern Baltic shores. They advocated openly " courageous 
lining up at the side of Geimany," as the phrase went, 
and acted ih close co-operation with the corresponding 
'■ young blood " «)f Finland. The (leiman Legation in 
Stockholm was a centre for this co-operation ; a large number 
<^f Finlanders went to Geimany to be trained as soldiers; 
arrangements for smuggling of aims into Finland were made 
and valuable information fiom Russia was constantly obtained 
through these channels. 
The " .Activists " were never numerically strong and they 
were widely ridiculed. But their connections among the govern- 
ing classes, which held the grip on the State machine, the 
silent support from ruling circles, their underhand methods 
with German intrigues and plans for a rising in Finland, which 
should fire the Swedes, made thtm at one time dangerous in 
the sense that by a military or other coup the country might 
have been faced with a fail accompli, involving it in war 
against the will of the overwhelming majority of the people. 
The highest danger jjointwas reached when in August, 1915, 
the German armies penetrated deep into Russia and appeared 
able to get to Petrograd. 
But before that time the Liberals and the Social Democrats, 
particularly the latter under the strong lead of "Six. Branting. 
had conceived the danger of a coup, and had awakened 
public opinion to it. They had challenged the Conservatives 
and the (jovernment in Parliament to denounce the dangerous 
activities and received certain assurances. But although the 
Conservative Party leaders disclaimed connection with the 
" Activists," they could never be prevailed upon to denounce 
them or express any decided disapproval of their propaganda ; 
on the contrary, they publicly expressed their esteem of 
the movement as having ultimatelj' the highest patriotic end 
in view. , 
It was laid down as a leading thesis of international law 
that a neutral country's trade with belligerents was only 
limited by the belligerents' ability to stop by force the trade 
in contraband as determined by international law. The 
belligerents' needs, particularly Germany's, and in a less degree 
Russia's, gave rise to an enormously profitable trade in the 
countries situated between the belligerents. The Scandinavian 
countries were flooded by a swarm of commercial adventurers 
of a very cosmopolitan character with certain races pre- 
dominating. .\ great gamble began. Millions were often 
earned in a day in commercial speculations by persons who 
had no knowledge of commercial transactions. It was the 
great time of the " goulyash barons " — a general name given 
to these get-rich-quick-on-the-war people on account of the 
fortunes made by evading the law in making and sending 
large quantities of. " goulyash " to Germany from Denmark. 
The proceedings of the FZnglish Prize Court have given many 
interesting details of the methods used' by the gamblers to get 
goods into Germany. 
There was of course also a large increase in more legitimate 
business with commensurate profits in certain industrial 
and commercial branches, such as ship])ing, which made con- 
siderable fortunes, but those profits generally speaking never 
penetrated deep into the community. They remained in a com- 
l)aratively few hands, while the population as a whole very 
early began to feel the depressing influences of the war m 
increasing scarcity of foodstuffs and raw materials. 
Plockade Measures 
Only as the effects of the blockade measures, forced by 
Gerni.an lawlessness at sea, began to be felt more and more 
did the Hammarskjold government gradually iestrict the free 
reins ol commercial enterprise by a series of e-xport prohibi- 
tions and conditional licenses, compensation arrangements 
and other measures. But all those stejjs were characterised 
by vagueness and hesitation to interfere with the free play 
of economic forces. Thus, for instance, the export of agrr- 
cultuial produce, which before the war had its principal 
market in England, as a consequence soon went altogether to 
German\-, where the demand was much greater and higher 
prices were paid. The more far-.-,ighted urged the wisdom 
of maintaining as far as possible the pre-war export both to 
England and Germany, even at a loss, the more so as the coun- 
try had to look to importation from the west of such raw 
materials as oils, fats and fodder- in order to .maintain its 
agricultural production. But it was of no avail. As a result 
the import ol those raw materials was finally practically cut 
off by England for the reason given that she could not as a 
belligerent be a paijty to .assisting her enemy by supplying 
Sweden with oils and fats, for the manufacture of margarine, 
which released butter for export to Germany. The result was 
that the butter exj)ort ceased of itself and a scarcity of 
butter and margarine occurred in .Sweden. 
The Hammarskj(")ld jiolicy of neutrality became more and 
n'lore suspect to the Entente Powers, who formed the opinion 
that it was coiiducted by a mentality inclined towards Ger- 
many if not influenced by Germany for one reason or another. 
They considered that it was subservient to Ciermany, in- 
dulgently passing over the most brutal manifestation of Ger- 
man warfare, which was hitting even neutrals hard, such as 
the destruction of neutral ships without warning and murder- 
ing of neutral sailors, while it reacted strongly, even by hasty 
actions, against the Fmtente blockade measures, which, ' 
however considered, must be placed in a very much milder 
category of warfare. That was also the liberal criticism in 
Sweden, which found the Premier blinded by legal formalism. 
By degrees opposition against the Hammarskjold policy 
rose in Sweden as the growing difficulties in getting supplies 
from the west as result of that policy caused increa.sed shortage 
of many necessities. The widening opposition extended 
rapidly to industry and commerce. Great confidence had all 
the time lieen put in the Foreign Minister, Wallenberg, whose 
sympatJiies and whole character were Considered as a safe- 
guard, but events tended to show that he had finally been 
overruled by a mastering mind. It should be pointed out 
that Hammarskjold, the Prime Minister, has not in Sweden 
been seriously accused of any direct " Pro-German " jx)licy 
or of intention to deviate frojn conscious neutrality ; he was 
probably convinced of conducting a purely Swedish and 
strict neutrality. But effects count more than intentions in 
a position of such responsibility in a world's crisis. He was 
giadually accused of taking all the powers of Government 
in his own hand and of overriding Parliament. 
The gathering storm broke out when Parliament met 
last Januar\'. The Social Democrats gave the Government 
notice that the party-truce was at an end as a consequence 
of the policy of the (iovernment. Their attacks were violent ; 
they were sttpported by the Liberals and outside tho.se parties 
public opinion in the country was now strongly aroused on 
account of the scarcity in foodstuffs, which had necessitated 
rationing. The reckless submarine warfare declared by 
(iermany in l-'ebruarv altered somewhat the real position as 
it made a trade agreement with England — a second attempt 
to make one, for which Swedish delegates had been in London 
some months, had just failed — of less importance on account 
of the transport difficulties, but the feeling in Sweden could 
not be checkcfl. The Hammarskjold Government had to go. 
The King again summoned a Conservative Ministry, with 
a very 'capable business man and experienced iroiitician, 
Swartz, as Premier, and the cx-Premicr Lindman as Foreign 
