Nazi Pressure?

Snow-bearded, 84-year-old Prince Franz Paul I, ruler of the 65-square-mile principality of Liechtenstein, which snuggles up in the central Alps between Switzerland and Greater Germany (see map), has not visited his tiny nation for five years. He has run his Government by long-distance from Vienna and his Czechoslovakian estates. Last week the aged ruler suddenly abdicated at his hunting lodge near Semmering, Austria, named his 31-year-old third cousin, mustached, dapper Prince Franz Joseph, as his successor.

While the old Prince assured his 10,200 German-speaking subjects that he had abdicated because of his age, observers opined that apprehension over possible annexation by his new neighbor. Greater Germany, lay behind his move. Prince Franz Paul has no desire to be on the throne if Nazi Germany gobbles Liechtenstein. His wife, whom he married in 1929, is a wealthy Viennese Jewess and local Liechtenstein Nazis have already singled her out as their anti-Semitic "problem." The new Prince has no Jewish connections, is unmarried.

Although Liechtenstein has no official Nazi party, a Nazi sympathy movement has been simmering for years within its National Union party. Fortnight ago, emboldened by Nazi success in Austria, the Liechtenstein Nazi leaders openly announced that they were off to Berlin "to seek closer ties with Germany." Last week, in elections for the Diet following the Prince's abdication, the National Unionists made a vigorous showing, winning 48 government electors against 52 for the Bourgeois (Government) party. Twenty-four hours later the young Prince deemed it wise to reshuffle his Cabinet, give several posts to National Union Nazis. At the same time His Highness issued a whistling-in-the-dark assurance. "There is almost no Naziism in Liechtenstein," he said. "The population is content to live in a small independent state and wishes to continue the close union with Switzerland." Since 1924 Liechtenstein has been a member of the Swiss customs union, since 1921 has used Swiss currency, has Swiss-administered postal and telegraph systems.

Should Adolf Hitler desire to absorb Liechtenstein, he could meet little resistance, for the country has no army, no defenses and no military alliances. It sided with Austria in the Austro-Prussian war of 1866, but its 81 soldiers did not reach the front in time to fight. In 1914-18 Liechtenstein was neutral. Liechtenstein is 15 miles (beeline) of the upper Rhine Valley. It is a flag stop on the Paris-Budapest railway. The scenery is unbeatable; on the east side of the valley the Alps rise 8,441 ft. at the top of the Naafkopf. The biggest village is Vaduz (pop. 1,715), the capital. None of the others shelters more than 1,500. There are no jails. Three green-suited gendarmes keep order. The inhabitants of the mountainous, comic-opera principality are largely cattle raisers, farmers. Chief means of transport is the bicycle and the streets of the sleepy little valley towns are usually dotted with cyclists, ambling cows and goats. The ruling family owns Liechtenstein's only industries--i.e., a weaving mill, using U. S. cotton, a brewery and a spinning mill.

The House of Liechtenstein, European landholders since the 12th Century, came into possession of part of Liechtenstein in 1699, the remainder in 1712. It was constituted a principality in 1719 by diploma from the Holy Roman Emperor Charles VI. Archdukes of the House of Habsburg often turned to the House of Liechtenstein for their brides. Austrian Kaiser Franz Josef once named Liechtenstein's Prince Franz Paul, who abdicated last week, as Austro-Hungarian Ambassador to the Imperial Russian court. The art collection of hoary Prince Franz Paul is one of Europe's finest.

If Liechtenstein now becomes part of Greater Germany the inhabitants will almost certainly lose their most cherished liberty--freedom from taxation. The ruling Prince, having long footed the Government bills himself, discovered in 1926 a way to relieve the strain on his own diminished income. Watching the rise of confiscatory taxes on corporations, wealthy citizens in Europe and the U. S., he smartly invited foreign corporations and private citizens to incorporate in his state and pay minimum taxes. Since then these foreigner-paid taxes, small as they are, have paid some 45% of the nation's expenses. The Liechtenstein family, owning virtually all the nation's wealth, graciously pays the rest.

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