Chapter 135: Lease

Although he knew Fisher’s trip to the United States would bode no good, Feng Chengqian had not expected the U.S. to show such blatant favoritism toward Britain on such a monumental issue.

On January 25, Feng rushed back to Berlin and sought out Tirpitz.

"The news has been confirmed," Tirpitz sighed. "The U.S. President and the Congressional Military Committee have agreed in principle to Fisher's proposal. Now, it only awaits the stance of the Foreign Relations Committee. According to our intelligence, Britain intends to trade Diego Garcia, the Bermuda Islands, and several Pacific islands for eight to ten American battleships, while also seeking more direct military assistance."

"What does that mean?"

"If possible, the U.S. will send naval personnel to join the war as volunteers."

"Would the U.S. really do that?" Feng asked, astonished. "If so, they would be trampling on the principle of neutrality in the most naked fashion."

"Do you really think the American authorities care about that?"

"This..."

"You once told me that it is not the politicians in the White House or Congress who control America, but the capitalists who hold the lifeblood of the American economy." Feng exhaled deeply, forcing himself to remain calm.

"We should have expected this sooner or later." Tirpitz pulled a document from his drawer and handed it to Feng. "This is the information sent back by our ambassador in the U.S. All your questions are answered here. I fear that nothing we do can change the reality that is about to unfold."

Feng sighed to himself and opened the file. After reading just a few pages, he understood.

The problem did not lie in America’s political stance—or rather, the lack thereof—but in the dynamics of the American economy.

After the Battle of the Norwegian Sea, the Imperial Navy had seized the initiative and begun a strategic blockade of Britain. A direct consequence was a sharp decline in supplies entering Britain from the U.S., while imports into the German Empire surged.

That was the crux of the matter.

Although the Empire had a high demand for war materials, its industrial base was robust. In critical areas like steel and coal, the Empire was largely self-sufficient. Even when imports were required, it could source them from Sweden and Norway. Furthermore, following Russia’s defeat, coal and iron ore supplies from there were plentiful. Consequently, the German Empire hardly imported any steel from the U.S. Conversely, before the Battle of the Norwegian Sea, steel had accounted for a significant portion of Britain’s imports from America.

The result was that U.S. steel exports had plummeted over the past few months.

To an industrialized nation, what does steel production represent? In the industrial age, it is arguably the primary metric of a nation's industrial strength. Before the war, the U.S. had surpassed the German Empire to become the world’s leading industrial power, with steel production firmly ranked first. After the war broke out, orders from belligerent nations stimulated the American steel industry, prompting enterprises to expand capacity rapidly.

Production increased, but the products could not be sold. That was the problem.

To make matters worse, protected by the natural barrier of the North Atlantic and influenced by domestic anti-war sentiment, the U.S.'s own domestic steel consumption remained low. By the end of 1915, the U.S. Army had fewer than 500,000 troops, and the Navy had not increased its orders for new warships.

In a sense, it was the orders from the warring nations that sustained the American steel industry.

Now, with British orders gone, the German Empire having little demand, and the U.S. military not expanding, how were American steel companies to survive? Even more critically, almost all these companies had borrowed heavily from banks to expand production. If they went bankrupt, the American banks would suffer the greatest losses.

At this point, the U.S. had no need to enter the war, so selling arms became the primary means of keeping the steel industry alive.

"It seems you were right; we are indeed powerless to stop this."

"That is only the underlying cause. If you factor in the desires of the U.S. military, it becomes even more complex."

"You mean..."

"Although the war has lasted only a year, it is enough for everyone to realize that the nature of warfare has changed significantly. Armies modeled after the Franco-Prussian War cannot survive in future conflicts. The U.S. military surely realizes this and will undoubtedly pursue military reform." Tirpitz paused. "The U.S. Navy is also feeling the pressure. The *Queen Elizabeth*-class has been tested by fire, and our *Bayern*-class is about to enter the fray. The U.S. Navy possesses no warships that can rival these, so they are surely eager to build new capital ships."

"The problem is that Congress will not approve the naval construction plan."

"It is not that they won't approve it; it is that members of Congress believe the U.S. Navy’s existing fleet is sufficient to maintain American security and interests."

"This..."

Tirpitz smiled. "Thus, the U.S. Navy must dispose of its current warships to have the opportunity to build new ones."

Feng nodded, grasping Tirpitz’s point.

"Of course, this also serves the interests of American steel firms and banks, especially the banks. Building warships consumes vast amounts of steel, and for the federal government to increase the military budget, it must borrow from banks, allowing the bankers to profit further."

"So, the U.S. will sell its obsolete warships to Britain."

"If they sell them, it violates the principle of neutrality. The most effective method is to lend them. In fact, Fisher understands this well, which is why he proposed a lease rather than a purchase." Tirpitz sighed. "Of course, there is no substantive difference between the two."

"Are you saying we have no way to stop this dirty deal?"

"How could we?" Tirpitz retorted.

Feng could not answer, for principles observed in peacetime become empty words in wartime.

"I believe the best approach is to prepare for the worst." Tirpitz looked at Feng. "You are now the Commander of the High Seas Fleet. If the British Royal Navy acquires several capital ships from the U.S., how do you intend to neutralize the impact?"

"Regardless, we cannot attack the American mainland."

"And then?"

Feng pondered for a while. "Once the U.S. and Britain sign the lease agreement and formally hand those ships over to the Royal Navy, we won't have those constraints. Besides, perhaps those war-profiteering Yankees dream of us sinking the leased ships, as that would mean Britain would have to beg the U.S. for more aid and lease even more ships. The American authorities likely have similar thoughts, because if those ships are sunk, Britain will have to forfeit the colonies they put up as collateral."

"So, you want to stop this fleet from reaching Britain?"

"In any case, it is far easier to destroy a fleet that has not yet formed a combat capability than one that has already been integrated."

"The question is, can you do it?"

Feng reflected for a moment. "Even if the U.S. and Britain sign the contract, they cannot deliver the ships to the Royal Navy immediately. More importantly, the Royal Navy lacks sufficient manpower and will certainly try to recruit U.S. naval personnel. That will take at least a few months. By then, the Royal Navy will have recovered its strength, and our own power will have grown as well. How we fight will depend on the actual situation. One thing is clear: we must not wait until the Royal Navy is fully prepared. We must seize this opportunity to weaken their combat effectiveness. If the Anglo-American fleets integrate, no matter our efforts, the hope of defeating them will be slim."

"Perhaps we won't have to wait months."

"You mean..."

"Next month, Ludendorff will launch an offensive on the Western Front. While my information suggests he may not defeat France in one stroke, he will certainly make the Anglo-French forces suffer. His actions will inevitably prompt Britain to accelerate the leasing of these warships."

Feng exhaled, his expression darkening.

"Fortunately, by next month, you will receive four brand-new battleships."

"This..."

"Do you know why I resigned as Navy Commander? As Minister of the Navy, I can focus my energy on ship construction." Tirpitz smiled. "Of course, the fact that the four *Bayern*-class battleships can be completed ahead of schedule has much to do with the Emperor's support. Furthermore, the Army's strategic victory on the Eastern Front has eased the pressure on supplies, allowing us to allocate more steel."

"If that is true, our chances of winning are much greater."

"My advice is not to fixate solely on those American ships. If we leak the news, the Royal Navy will surely dispatch the Grand Fleet to escort them. You can seize that opportunity to engage the Grand Fleet in a decisive battle and make the Royal Navy pay a heavy price."

Feng nodded, acknowledging Tirpitz’s strategy.

"By the way, there is one more thing."

"What is it?"

"News arrived two days ago that Jellicoe has been restored to the rank of Admiral. He may soon become Commander of the Grand Fleet again, and Beatty is likely to be removed."

"Is that reliable?"

"It should be. After all, Beatty has proven through his actions that he is not the ideal candidate to lead the Grand Fleet in battle."

"If Jellicoe takes command of the Grand Fleet, that could be troublesome."

"Certainly, but you need not worry. After all, the initiative remains in our hands, and Jellicoe has no better options."

Feng nodded and said no more.