Press published here, indicate that the real crisis following the
_Arabic_ is in Germany, not America. He writes:

"The Berlin Foreign Office is unalterably opposed to submarine
activity, such as evidenced by the _Arabic_ affair, and it was on the
initiative of this Government department that immediate steps were
taken with Mr. Gerard the American Ambassador. The nature of these
negotiations is still unknown to the German public.

"It is stated on the highest authority that Herr von Jagow, Secretary
of Foreign Affairs, and Chancellor von Bethmann-Hollweg are unanimous
in their anxiety to settle American difficulties once and for all,
retaining the friendship of the United States in any event.

"The Kaiser is expected to approve the course suggested by the Imperial
Chancellor, despite open opposition to any disavowal of submarine
activities which constantly emanates from the German Admiralty.

"The Chancellor is extremely desirous of placing Germany on record as
an observer of international law as regards sea warfare, and in this
case will win his demand that submarines in the future shall thoroughly
warn enemy ships before firing their torpedoes or shells.

"There is considerable discussion in official circles as to whether the
Chancellor's steps create a precedent, but it is agreed that it will
probably close all complications with America, including the
_Lusitania_ case, which remained unsettled following President Wilson's
last note to Germany.

"Thus if the United States approves the present attitude of the