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==World War II== When World War II began with [[Invasion of Poland|German-Soviet Invasion of Poland]] in September 1939, Carol proclaimed [[Neutral country|neutrality]]. In doing so, Carol technically violated the letter of the treaty of alliance with Poland signed in 1921 and the spirit of treaty of alliance signed with France in 1926. Carol justified his policy under the grounds that, with Germany and the Soviet Union allied in the Molotov–Ribbentrop pact of August 1939 and France holding its forces behind the Maginot line, unwilling to start an offensive into Germany, that neutrality was his only hope of preserving his kingdom's independence.{{sfn|Weinberg|2005|p=79}} For its part, the Polish government was more interested in weapon deliveries from its Western allies through Romanian ports, but this became insignificant following Poland's defeat on the battlefield. As usual with Carol, he sought to play a careful balancing act between the Allies and the Axis, on one hand signing a new economic treaty with Germany while on the other hand allowing for a considerable period of time for the Polish troops to cross into Romania while declining to intern them as international law required. Instead, the Poles were allowed to travel to [[Constanța]] to board ships to take them to [[Marseille]] to continue the fight against Germany from France.{{sfn|Weinberg|2005|p=79}} The [[Romanian Bridgehead]] remained a key escape route for thousands of Poles in the desperate days of September 1939. It was only after receiving a number of furious complaints from Fabricius about the passage of Polish soldiers across Romania that Carol finally started to intern the fleeing Poles. On 21 September 1939, Prime Minister Călinescu was assassinated by the Iron Guard in a plot organized out of Berlin, thus silencing the strongest pro-Allied voice amongst Carol's ''camarilla''.{{sfn|Ancel|2011|p=42}} The next day, the nine assassins of Călinescu were publicity shot without the benefit of a trial and on the week of 22–28 September 1939, 242 members of the Iron Guard were the victims of extrajudicial executions.{{sfn|Ancel|2011|p=43}} Because of its oil, Romania was highly important by both sides, and during the [[Phoney War]] of 1939–40 there occurred what Weinberg called a "silent struggle over Romania's oil," with the German government doing everything within its power to have as much Romanian oil as possible while the British and French governments equally doing everything possible to deny it.{{sfn|Weinberg|2005|p=78–79}} The British launched an unsuccessful campaign to sabotage Romanian oil fields and the transportation network that took Romanian oil to Germany.{{sfn|Weinberg|2005|p=79}} In January 1940, Carol broadcast a speech to proclaim that it was his brilliant handling of foreign policy that kept Romania neutral and safe from danger.{{sfn|Crampton|1997|p=117}} He also announced that he was going to be building a gigantic defense line around the kingdom, and as such, taxes would have to rise to pay for it. Romanians called the proposed line the Imaginet Line, as the line was considered to be a purely imaginary version of the Maginot line and many of Carol's subjects suspected that the money raised by higher taxes would go to the king's Swiss bank accounts.{{sfn|Crampton|1997|p=117}} Carol had hedged his bets about whether to choose between the Allies and the Axis. It was only in late May 1940, when [[Battle of France|France was clearly losing the war]] that Carol swung decisively over to the Axis side.{{sfn|Weinberg|2005|p=135–136}} During the later period of the Phoney War, after waging a campaign of bloody repression against the Iron Guard, which reached its peak after Călinescu's assassination, Carol began a policy of reaching out to the surviving Iron Guard leaders.{{sfn|Haynes|1999|p=707–708}} Carol felt that a "tamed" Iron Guard could be used as a source of popular support. In April 1940, Carol had reached an agreement with Vasile Noveanu, the leader of the underground Iron Guard in Romania, but it was not until early May 1940 that [[Horia Sima]], the leader of the Iron Guards in exile in Germany, could be persuaded to support the government.{{sfn|Haynes|1999|p=708}} On 26 May 1940, Sima returned to Romania from Germany to begin talks with General [[Mihail Moruzov]] of the secret service about the Iron Guard joining the government.{{sfn|Haynes|1999|p=708}} On 28 May 1940, after learning of the [[Battle of Belgium|surrender of Belgium]], Carol told the Crown Council that Germany was going to win the war, and Romania accordingly needed to realign its foreign and domestic policies with the victors.{{sfn|Haynes|1999|p=708}} On 13 June 1940, an agreement was reached whereas the Iron Guard would be allowed to join the National Renaissance Front in exchange for more and harsher anti-Semitic laws.{{sfn|Haynes|1999|p=708}} The National Renaissance Front was reorganized as the Party of the Nation, which was described as "a single and totalitarian party under the supreme leadership of His Majesty, King Carol II."<ref>[https://web.archive.org/web/20070629095556/http://www.inshr-ew.ro/pdf/Final_Report.pdf ''Final Report''] of the [[Wiesel Commission|International Commission on the Holocaust in Romania]]</ref> On 21 June 1940, France signed an armistice with Germany. Romania's elite had been so obsessively Francophile for so long that France's defeat had the effect of discrediting that elite in the eyes of public opinion and led to an upswing of popular support for the pro-German Iron Guard.{{sfn|Crampton|1997|p=117}} In the midst of the turn towards the Iron Guard and Germany came a bombshell from abroad. On 26 June 1940, the Soviet Union submitted an ultimatum demanding that Romania hand over the [[Bessarabia]] region (which had been Russian until 1918) and the northern part of Bukovina (which had never been Russian) to the Soviet Union and threatened war within the next two days if the ultimatum was rejected.{{sfn|Weinberg|2005|p=136}} Carol had at one moment considered following the example of [[Finland]] in 1939 when faced with a similar Soviet ultimatum, but the outcome of the [[Winter War]] was scarcely an inspiring example.{{sfn|Weinberg|2005|p=136}} Carol at first considered rejecting the ultimatum, but upon being informed that the Romanian Army would be no match for the [[Red Army]], agreed to cede Bessarabia and northern Bukovina to the Soviet Union. Carol appealed to Berlin for support against the Soviet ultimatum, only to be told to comply with Stalin's demands.{{sfn|Weinberg|2005|p=136}} The loss of the regions without any fighting to the Soviet Union was felt to be a national humiliation by the Romanian people and was a huge blow to Carol's prestige. [[Carol II of Romania's cult of personality|Carol's personality cult]] had by 1940 reached such extreme heights that the withdrawal without any resistance from Bessarabia and northern Bukovina revealed that Carol was a mere man after all, and so badly dented his prestige more than would have been the case if Carol had maintained a more modest image.{{sfn|Crampton|1997|p=117}} On 28 June 1940, Sima entered the cabinet as Under-Secretary of State at the Ministry of Education.{{sfn|Haynes|1999|p=709}} On 1 July 1940, Carol, in a radio speech, renounced both the 1926 alliance with France and the 1939 Anglo-French "guarantee" of Romania, saying that henceforth Romania would seek its place in the German-dominated "New Order" in Europe.{{sfn|Haynes|1999|p=702}} The next day, Carol invited a German military mission to train the Romanian Army.{{sfn|Haynes|1999|p=702}} On 4 July 1940, Carol was sworn into a new government headed by [[Ion Gigurtu]] with Sima as Minister of Arts and Culture.{{sfn|Haynes|1999|p=703}} Gigurtu had been a leading figure in the anti-Semitic National Christian Party in the 1930s, was a millionaire businessman with many connections to Germany, and was a well-known Germanophile.{{sfn|Haynes|1999|p=703}} For all these reasons, Carol hoped that having Gigurtu as prime minister would win him Hitler's goodwill and thus prevent any further loss of territory.{{sfn|Haynes|1999|p=703}} Along the same lines, Carol signed a new economic treaty with Germany on 8 August 1940, that finally gave the Germans the economic dominance of Romania and its oil that they had been seeking all through the 1930s. Immediately afterwards, inspired by the Soviet example of gaining Romanian territory, the Bulgarians demanded the return of Dobruja, lost in the [[Second Balkan War]] of 1913, while the Hungarians demanded the return of Transylvania, lost to Romania after World War I.{{sfn|Weinberg|2005|p=184}} Romania and Bulgaria opened talks that led to the Treaty of Craiova, which saw the southern Dobruja ceded to Bulgaria. In particular, Carol proved unwilling to cede Transylvania, and had it not been for the diplomatic intervention of Germany and Italy, Romania and Hungary would have gone to war with each other in the summer of 1940.{{sfn|Weinberg|2005|p=184}} In the meantime, Carol imprisoned General [[Ion Antonescu]] after the latter had criticized the king, charging that it was the corruption of the royal government that was responsible for the military backwardness of Romania and hence the loss of Bessarabia.{{sfn|Haynes|1999|p=715}} Both Fabricius and Hermann Neubacher, the man in charge of the Four Year Plan's operations in the Balkans, intervened with Carol, saying that Antonescu's "accidental death" or being "shot while trying to escape" would "make a very bad impression on the German headquarters," as Antonescu was known to be a leading advocate of an alliance with Germany.{{sfn|Haynes|1999|p=715}} On 11 July 1940, Carol had Antonescu freed, but kept under house arrest at the Bistrița monastery.{{sfn|Haynes|1999|p=715}} Hitler was alarmed about the possibility of a Hungarian-Romanian war, which he feared might result in the destruction of Romania's oil fields and/or might lead to the Soviets intervening to seize all of Romania.{{sfn|Weinberg|2005|p=184}} At this time, Hitler was already seriously considering invading the Soviet Union in 1941, and if he were to take such a step, he would need Romanian oil to power his military.{{sfn|Weinberg|2005|p=184}} At the [[Second Vienna Award]] of 30 August 1940, the German Foreign Minister [[Joachim von Ribbentrop]] and the Italian Foreign Minister Count [[Galeazzo Ciano]] ruled that northern Transylvania was to go to Hungary while southern Transylvania would stay with Romania, a compromise that left both Budapest and Bucharest deeply unhappy with the Vienna award.{{sfn|Weinberg|2005|p=185}} For economic reasons, Romania was far more important to Hitler than was Hungary, but Romania had been allied to France since 1926 and had flirted with joining the British-inspired "peace front" in 1939, so Hitler who personally disliked and mistrusted Carol – felt that Romania deserved to be punished for waiting so long to align with the Axis.{{sfn|Weinberg|2005|p=184}} After the fall of Paris in June 1940, the Germans had captured the archives of the [[Quai d'Orsay]] and were thus well-informed about the double-line that Carol had pursued until the spring of 1940.{{sfn|Weinberg|2005|p=184}} Hitler was annoyed with Carol's efforts to forge closer ties with France at the same time proclaiming his friendship towards Germany.{{sfn|Weinberg|2005|p=184}} At the same time, Hitler offered Carol a "guarantee" of the rest of Romania against further territorial losses, which Carol promptly accepted.{{sfn|Weinberg|2005|p=185}}
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