In elaboration of this general thesis it is pointed out that the processes of exchange have become too complex for direct barter, and can only take place by virtue of credit; and it is by the credit system, the ‘sensory nerve’ of the economic organism, that the self-injurious results of economic war are first shown. If, after a victorious war, we allow enemy industry and international trade to go on much as before, then obviously our victory will have had very little effect on the fundamental economic situation. If, on the other hand, we attempt for political or other reasons to destroy our enemy’s industry and trade, to keep him from the necessary materials of it, we should undermine our own credit by diminishing the exchange value of much of our own real wealth. For this reason it is ‘a great illusion’ to suppose that by the political annexation of colonies, territories with iron-mines, coal-mines, we enrich ourselves by the amount of wealth their exploitation represents.[117]

The large place which such devices as an international credit system must take in our international economy, adds enormously to the difficulty of securing any ‘spoils of victory’ in the shape of indemnity. A large indemnity is not impossible, but the only condition on which it can be made possible—a large foreign trade by the defeated people—is not one that will be readily accepted by the victorious nation. Yet the dilemma is absolute: the enemy must do a big foreign trade (or deliver in lieu of money large quantities of goods) which will compete with home production, or he can pay no big indemnity—nothing commensurate with the cost of modern war.

Since we are physically dependent on co-operation with foreigners, it is obvious that the frontiers of the national State are not co-terminous with the frontiers of our society. Human association cuts athwart frontiers. The recognition of the fact would help to break down that conception of nations as personalities which plays so large a part in international hatred. The desire to punish this or that ‘nation’ could not long survive if we had in mind, not the abstraction, but the babies, the little girls, old men, in no way responsible for the offences that excited our passions, whom we treated in our minds as a single individual.[118]

As a means of vindicating a moral, social, religious, or cultural ideal—as of freedom or democracy—war between States, and still more between Alliances, must be largely ineffective for two main reasons. First, because the State and the moral unit do not coincide. France or the British Empire could not stand as a unit for Protestanism as opposed to Catholicism, Christianity as opposed to Mohammedanism, or Individualism as opposed to Socialism, or Parliamentary Government as opposed to Bureaucratic Autocracy, or even for European ascendancy as against Coloured Races. For both Empires include large coloured elements; the British Empire is more Mohammedan than Christian, has larger areas under autocratic than under Parliamentary government; has powerful parties increasingly Socialistic. The State power in both cases is being used, not to suppress, but to give actual vitality to the non-Christian or non-European or coloured elements that it has conquered. The second great reason why it is futile to attempt to use the military power of States for ends such as freedom and democracy, is that the instincts to which it is compelled to appeal, the spirit it must cultivate and the methods it is compelled increasingly to employ, are themselves inimical to the sentiment upon which freedom must rest. Nations that have won their freedom as the result of military victory, usually employ that victory to suppress the freedom of others. To rest our freedom upon a permanent basis of nationalist military power, is equivalent to seeking security from the moral dangers of Prussianism by organising our States on the Prussian model.

Our real struggle is with nature: internecine struggles between men lessen the effectiveness of the human army. A Continent which supported precariously, with recurrent famine, a few hundred thousand savages fighting endlessly between themselves, can support, abundantly a hundred million whites who can manage to maintain peace among themselves and fight nature.

Nature here includes human nature. Just as we turn the destructive forces of external nature from our hurt to our service, not by their unintelligent defiance, but by utilising them through a knowledge of their qualities, so can the irrepressible but not ‘undirectable’ forces of instinct, emotion, sentiment, be turned by intelligence to the service of our greatest and most permanent needs.

CHAPTER IV

ARGUMENTS NOW OUT OF DATE

As already explained in the first part of this book (Chapter II) this war has marked a revolution in the position of private property and the relation of the citizen to the State. The Treaty of Versailles departs radically from the general principles adhered to, for instance, in the Treaty of Frankfurt; the position of German traders and that of the property of German citizens does not at all to-day resemble the position in which the Treaty of Frankfurt left the French trader and French private property.

The fact of the difference has already been entered into at some length. It remains to see how the change affects the general argument adopted in The Great Illusion.

It does not affect its final conclusions. The argument ran: A conqueror cannot profit by ‘loot’ in the shape of confiscations, tributes, indemnities, which paralyse the economic life of the defeated enemy. They are economically futile. They are unlikely to be attempted, but if they are attempted they will still be futile.[119]

Events have confirmed that conclusion, though not the expectation that the enemy’s economic life would be left undisturbed. We have started a policy which does injure the economic life of the enemy. The more it injures him, the less it pays us. And we are abandoning it as rapidly as nationalist hostilities will permit us. In so far as pre-war conditions pointed to the need of a definitely organised international economic code, the situation created by the Treaty has only made the need more visible and imperative. For, as already explained in the first Part, the old understandings enabled industry to be built up on an international basis; the Treaty of Versailles and its confiscations, prohibitions, controls, have destroyed those foundations. Had that instrument treated German trade and industry as the Germans treated French in 1871 we might have seen a recovery of German economic life relatively as rapid as that which took place in France during the ten years which followed her defeat. We should not to-day be faced by thirty or forty millions in Central and Eastern Europe without secure means of livelihood.

The present writer confesses most frankly—and the critics of The Great Illusion are hereby presented with all that they can make of the admission—that he did not expect a European conqueror, least of all Allied conquerors, to use their victory for enforcing a policy having these results. He believed that elementary considerations of self-interest, the duty of statesmen to consider the needs of their own countries just emerging from war, would stand in the way of a policy of this kind. On the other hand, he was under no illusions as to what would result if they did attempt to enforce that policy. Dealing with the damage that a conqueror might inflict, the book says that such things as the utter destruction of the enemy’s trade

Because of the ‘interdependence of our credit-built finance and industry’

All the suggestions made as to the economic futility of such a course—including the failure to secure an indemnity—have been justified.[120]

In dealing with the indemnity problem the book did forecast the likelihood of special trading and manufacturing interests within the conquering nation opposing the only condition upon which a very large indemnity would be possible—that condition being either the creation of a large foreign trade by the enemy or the receipt of payment in kind, in goods which would compete with home production. But the author certainly did not think it likely that England and France would impose conditions so rapidly destructive of the enemy’s economic life that they—the conquerors—would, for their own economic preservation, be compelled to make loans to the defeated enemy.

Let us note the phase of the argument that the procedure adopted renders out of date. A good deal of The Great Illusion was devoted to showing that Germany had no need to expand territorially; that her desire for overseas colonies was sentimental, and had little relation to the problem of providing for her population. At the beginning of 1914 that was certainly true. It is not true to-day. The process by which she supported her excess population before the War will, to put it at its lowest, be rendered extremely difficult of maintenance as the result of allied action. The point, however, is that we are not benefiting by this paralysis of German industry. We are suffering very greatly from it: suffering so much that we can be neither politically nor economically secure until this condition is brought to an end. There can be no peace in Europe, and consequently no safety for us or France, so long as we attempt by power to maintain a policy which denies to millions in the midst of our civilisation the possibility of earning their living. In so far as the new conditions create difficulties which did not originally exist, our victory does but the more glaringly demonstrate the economic futility of our policy towards the vanquished.

An argument much used in The Great Illusion as disproving the claims made for conquest was the position of the population of small States. ‘Very well,’ may say the critic, ‘Germany is now in the position of a small State. But you talk about her being ruined!’

In the conditions of 1914, the small State argument was entirely valid (incidentally the Allied Governments argue that it still holds).[121] It does not hold to-day. In the conditions of 1920 at any rate, the small State is, like Germany, economically at the mercy of British sea power or the favoritism of the French Foreign Office, to a degree that was unknown before the War. How is the situation to develop? Is the Dutch or Swedish or Austrian industrial city permanently to be dependent upon the good graces of some foreign official sitting in Whitehall or the Quai d’Orsay? At present, if an industrialist in such a city wishes to import coal or to ship a cargo to one of the new Baltic States, he may be prevented owing to political arrangements between France and England. If that is to be the permanent situation of the non-Entente world, then peace will become less and less secure, and all our talk of having fought for the rights of the small and weak will be a farce. The friction, the irritation, and sense of grievance will prolong the unrest and uncertainty, and the resultant decline in the productivity of Europe will render our own economic problems the more acute. The power by which we thus arrogate to ourselves the economic dictatorship of Europe will ultimately be challenged.

Can we revert to the condition of things which, by virtue of certain economic freedoms that were respected, placed the trader or industrialist of a small State pretty much on an equality, in most things, with the trader of the Great State? Or shall we go forward to a recognised international economic system, in which the small States will have their rights secured by a definite code?

Reversion to the old individualist ‘trans-nationalism’ or an internationalism without considerable administrative machinery—seems now impossible. The old system is destroyed at its sources within each State. The only available course now is, recognising the fact of an immense growth in the governmental control or regulation of foreign trade, to devise definite codes or agreements to meet the case. If the obtaining of necessary raw materials by all the States other than France and England is to be the subject of wrangles between officials, each case to be treated on its merits, we shall have a much worse anarchy than before the War. A condition in which two or three powers can lay down the law for the world will indeed be an anti-climax.

We may never learn the lesson; the old futile struggles may go on indefinitely. But if we do put our intelligences to the situation it will call for a method of treatment somewhat different from that which pre-war conditions required.

For the purposes of the War, in the various Inter-Allied bodies for the apportionment of shipping and raw material, we had the beginnings of an economic League of Nations, an economic World Government. Those bodies might have been made democratic, and enlarged to include neutral interests, and maintained for the period of Reconstruction (which might in any case have been regarded as a phase properly subject to war treatment in these matters). But these international organisations were allowed to fall to pieces on the removal of the common enmity which held the European Allies and America together.

The disappearance of these bodies does not mean the disappearance of ‘controls,’ but the controls will now be exercised in considerable part through vast private Capitalist Trusts dealing with oil, meat, and shipping. Nor will the interference of government be abolished. If it is considered desirable to ensure to some group a monopoly of phosphates, or palm nuts, the aid of governments will be invoked for the purpose. But in this case the government will exercise its powers not as the result of a publicly avowed and agreed principle, but illicitly, hypocritically.

While professing to exercise a ‘mandate’ for mankind, a government will in fact be using its authority to protect special interests. In other words we shall get a form of internationalism in which the international capitalist Trust will control the Government instead of the Government’s controlling the Trust.

The fact that this was happening more and more before the War was one reason why the old individualist order has broken down. More and more the professed position and function of the State was not its real position and function. The amount of industry and trade dependent upon governmental intervention (enterprises of the Chinese Loan and Bagdad Railway type) before the War was small compared with the quantity that owed nothing to governmental protection. But the illicit pressure exercised upon governments by those interested in the exploitation of backward countries was out of proportion to the public importance of their interests.

It was this failure of democratic control of ‘big business’ by the pre-war democracies which helped to break down the old individualism. While private capital was apparently gaining control over the democratic forces, moulding the policy of democratic governments, it was in fact digging its own grave. If political democracy in this respect had been equal to its task, or if the captains of industry had shown a greater scruple or discernment in their use of political power, the individualist order might have given us a workable civilisation; or its end might have been less painful.

The Great Illusion did not assume its impending demise. Democracy had not yet organised socialistic controls within the nation. To have assumed that the world of nationalisms would face socialistic regulation and control as between States, would have implied an agility on the part of the public imagination which it does not in fact possess. An international policy on these lines would have been unintelligible and preposterous. It is only because the situation which has followed victory is so desperate, so much worse than anything The Great Illusion forecast, that we have been brought to face these remedies to-day.

Before the War, the line of advance, internationally, was not by elaborate regulation. We had seen a congeries of States like those of the British Empire maintain not only peace but a sort of informal Federation, without limitation in any formal way of the national freedom of any one of them. Each could impose tariffs against the mother country, exclude citizens of the Empire, recognise no common defined law. The British Empire seemed to forecast a type of international Association which could secure peace without the restraints or restrictions of a central authority in anything but the most shadowy form. If the merely moral understanding which held it together and enabled co-operation in a crisis could have been extended to the United States; if the principle of ‘self-determination’ that had been applied to the white portion of the Empire were gradually extended to the Asiatic; if a bargain had been made with Germany and France as to the open door, and equality of access to undeveloped territory made a matter of defined agreement, we should have possessed the nucleus of a world organisation giving the widest possible scope for independent national development. But world federation on such lines depended above all, of course, upon the development of a certain ‘spirit,’ a guiding temper, to do for nations of different origin what had already been done for nations of a largely common origin (though Britain has many different stocks—English, Scottish, Irish, Welsh, and, overseas, Dutch and French as well). But the spirit was not there. The whole tradition in the international field was one of domination, competition, rivalry, conflicting interest, ‘Struggle for life.’

The possibility of such a free international life has disappeared with the disappearance of the laisser-faire ideal in national organisation. We shall perforce be much more concerned now with the machinery of control in both spheres as the only alternative to an anarchy more devastating than that which existed before the War. For all the reasons which point to that conclusion the reader is referred once more to the second chapter of the first part of this book.

CHAPTER V

THE ARGUMENT AS AN ATTACK ON THE STATE

The most serious criticism has been directed to one specific point. It is made notably both by Professor Spenser Wilkinson[122] and Professor Lindsay,[123] and as it is relevant to the existing situation and to much of the argument of the present book, it is worth dealing with.

The criticism is based on the alleged disparagement of the State implied in the general attitude of the book. Professor Lindsay (whose article, by the way, although hostile and misapprehending the spirit of the book, is a model of fair, sincere, and useful criticism) describes the work under criticism largely as an attack on the conception of ‘the State as a person.’ He says in effect that the present author argues thus:—

Professor Lindsay continues:—

As a matter of fact Professor Lindsay has himself answered his own criticism. For he goes on:—

Very well. We had here in the pre-war period two dangers, either of which in Professor Lindsay’s view would make the preservation of civilisation impossible: one danger was that men would over-emphasise their narrower patriotism and surrender themselves to the pugnacities of exclusive nationalism and distrust of foreigners, forgetting that the spiritual life of densely packed societies can only be rendered possible by certain widespread economic co-operations, contracts; the other danger was that we should under-emphasise each our own nationalism and give too much importance to the wider international organisation of mankind.

Into which danger have we run as a matter of simple fact? Which tendency is it that is acting as the present disruptive force in Europe? Has opinion and statesmanship—as expressed in the Treaty, for instance—given too much or too little attention to the interdependence of the world, and the internationally economic foundations of our civilisation?

We have seen Europe smashed by neglecting the truths which The Great Illusion stressed, perhaps over-stressed, and by surrendering to the exclusive nationalism which that book attacked. The book was based on the anticipation that Europe would be very much more likely to come to grief through over-stressing exclusive nationalism and neglecting its economic interdependence, than through the decay of the narrower patriotism.

If the book had been written in vacuo, without reference to impending events, the emphasis might have been different.[124]

But in criticising the emphasis that is thrown upon the welfare of the individual, Professor Lindsay would seem to be guilty of confusing the test of good political conduct with the motive. Certainly The Great Illusion did not disparage the need of loyalty to the social group—to the other members of the partnership. That need is the burden of most that has been written in the preceding pages when dealing with the facts of interdependence. An individual who can see only his own interest does not see even that; for such interest is dependent on others. (These arguments of egoism versus altruism are always circular.) But it insisted upon two facts which modern Europe seemed in very great danger of forgetting. The first was that the Nation-State was not the social group, not co-terminous with the whole of Society, only a very arbitrarily chosen part of it; and the second was that the test of the ‘good State’ was the welfare of the citizens who composed it. How otherwise shall we settle the adjustment between national right and international obligation, answer the old and inevitable question, ‘What is the Good State?’ The only intelligible answer is: the State which produces good men, subserves their welfare. A State which did not subserve the welfare of its citizens, that produced men morally, intellectually, physically poor and feeble, could not be a good State. A State is tested by the degree to which it serves individuals.

Now the fact of forgetting the first truth, that the Nation-State is not the whole of Society but only a part, and that we have obligations to the other part, led to a distortion of the second. The Hegelianism which denied any obligation above or beyond that of the Nation-State sets up a conflict of sovereignties, a competition of power, stimulating the instinct of domination, making indeed the power and position of the State with reference to rival States the main end of politics. The welfare of men is forgotten. The fact that the State is made for man, not man for the State, is obscured. It was certainly forgotten or distorted by the later political philosophers of Prussia. The oversight gave us Prussianism and Imperialism, the ideal of political power as an end in itself, against which The Great Illusion was a protest. The Imperialism, not alone in Prussia, takes small account of the quality of individual life, under the flag. The one thing to be sought is that the flag should be triumphant, be flown over vast territories, inspire fear in foreigners, and be an emblem of ‘glory.’ There is a discernible distinction of aim and purpose between the Patriot, Jingo, Chauvinist, and the citizen of the type interested in such things as social reform. The military Patriot the world over does not attempt to hide his contempt for efforts at the social betterment of his countryman. That is ‘parish pump.’ Mr Maxse or Mr Kipling is keenly interested in England, but not in the betterment of Englishmen; indeed, both are in the habit of abusing Englishmen very heartily, unless they happen to be soldiers. In other words, the real end of politics is forgotten. It is not only that the means have become the end, but that one element of the means, power, has become the end.

The point I desired to emphasise was that unless we keep before ourselves the welfare of the individual as the test of politics (not necessarily the motive of each individual for himself) we constantly forget the purpose and aim of politics, and patriotism becomes not the love of one’s fellow countrymen and their welfare, but the love of power expressed by that larger ‘ego’ which is one’s group. ‘Mystic Nationalism’ comes to mean something entirely divorced from any attribute of individual life. The ‘Nation’ becomes an abstraction apart from the life of the individual.

There is a further consideration. The fact that the Nation-State is not co-terminous with Society is shown by its vital need of others; it cannot live by itself; it must co-operate with others; consequently it has obligations to those others. The demonstration of that fact involves an appeal to ‘interest,’ to welfare. The most visible and vital co-operation outside the limits of the Nation-State is the economic; it gives rise to the most definite, as to the most fundamental obligation—the obligation to accord to others the right to existence. It is out of the common economic need that the actual structure of some mutual arrangement, some social code, will arise, has indeed arisen. This makes the beginning of the first visible structure of a world society. And from these homely beginnings will come, if at all, a more vivid sense of the wider society. And the ‘economic’ interest, as distinct from the temperamental interest of domination, has at least this social advantage. Welfare is a thing that in society may well grow the more it is divided: the better my countrymen the richer is my life likely to become. Domination has not this quality: it is mutually exclusive. We cannot all be masters. If any country is to dominate, somebody or some one else’s country must be dominated; if the one is to be the Superior Race, some other must be inferior. And the inferior sooner or later objects, and from that resistance comes the disintegration that now menaces us.

It is perfectly true that we cannot create the kind of State which will best subserve the interests of its citizens unless each is ready to give allegiance to it, irrespective of his immediate personal ‘interest.’ (The word is put in inverted commas because in most men not compelled by bad economic circumstances to fight fiercely for daily bread, sheer physical sustenance, the satisfaction of a social and creative instinct is a very real ‘interest,’ and would, in a well-organised society, be as spontaneous as interest in sport or social ostentation.) The State must be an idea, an abstraction, capable of inspiring loyalty, embodying the sense of interdependence. But the circumstances of the independent modern national State, in frequent and unavoidable contact with other similar States, are such as to stimulate not mainly the motives of social cohesion, but those instincts of domination which become anti-social and disruptive. The nationalist stands condemned not because he asks allegiance or loyalty to the social group, but first, because he asks absolute allegiance to something which is not the social group but only part of it, and secondly, because that exclusive loyalty gives rise to disruptive pugnacities, injurious to all.

In pointing out the inadequacy of the unitary political Nation-State as the embodiment of final sovereignty, an inadequacy due to precisely the development of such organisations as Labour, the present writer merely anticipated the drift of much political writing of the last ten years on the problem of State sovereignty; as also the main drift of events.[125]

If Mr Lindsay finds the very mild suggestions in The Great Illusion touching the necessary qualification of the sovereignty of the Nation-State subversive, one wonders what his feelings are on reading, say, Mr Cole, who in a recent book (Social Theory) leaves the Political State so attenuated that one questions whether what is left is not just ghost. At the best the State is just one collateral association among others.

The sheer mechanical necessities of administration of an industrial society, so immeasurably more complex than the simple agricultural society which gave us the unitary political State, seem to be pushing us towards a divided or manifold sovereignty. If we are to carry over from the National State into the new form of the State—as we seem now in danger of doing—the attitude of mind which demands domination for ‘our’ group, the pugnacities, suspicions, and hostilities characteristic of nationalist temper, we may find the more complex society beyond our social capacity. I agree that we want a common political loyalty, that mere obedience to the momentary interest of our group will not give it; but neither will the temper of patriotism as we have seen it manifested in the European national State. The loyalty to some common code will probably only come through a sense of its social need. (It is on the ground of its social need that Mr Lindsay defends the political State.) At present we have little sense of that need, because we have (as Versailles proved) a belief in the effectiveness of our own power to exact the services we may require. The rival social or industrial groups have a like belief. Only a real sense of interdependence can undermine that belief; and it must be a visible, economic interdependence.

A social sense may be described as an instinctive feeling for ‘what will work.’ We are only yet at the beginning of the study of human motive. So much is subconscious that we are certainly apt to ascribe to one motive conduct which in fact is due to another. And among the neglected motives of conduct is perhaps a certain sense of art—a sense, in this connection, of the difficult ‘art of living together.’ It is probably true that what some, at least, find so revolting in some of the manifestations of nationalism, chauvinism, is that they violently challenge the whole sense of what will work, to say nothing of the rights of others. ‘If every one took that line, nobody could live.’ In a social sense this is gross and offensive. It has an effect on one like the manners of a cad. It is that sort of motive, perhaps, more than any calculation of ‘interest,’ which may one day cause a revulsion against Balkanisation. But to that motive some informed sense of interdependence is indispensable.

CHAPTER VI

VINDICATION BY EVENTS

That conclusion was opposed, as we have seen, on two main grounds. One was that the desire for conquest and extension of territory did not enter appreciably into the causes of war, ‘since no one really believed that victory could advantage them.’ The other ground of objection, in contradistinction, was that the economic advantages of conquest or military predominance were so great and so obvious that to deny them was mere paradox-mongering.

The validity of both criticisms has been very thoroughly tested in the period that has followed the Armistice. Whether it be true or not that the competition for territory, the belief that predominant power could be turned to economic account, entered into the causes of the War, that competition and belief have certainly entered into the settlement and must be reckoned among the causes of the next war. The proposition that the economic advantages of conquest and coercion are illusory is hardly to-day a paradox, however much policy may still ignore the facts.

The outstanding facts of the present situation most worth our attention in this connection are these: Military predominance, successful war, evidently offer no solution either of specifically international or of our common social and economic problems. The political disintegration going on over wide areas in Europe is undoubtedly related very intimately to economic conditions: actual lack of food, the struggle for ever-increasing wages and better conditions. Our attempted remedies—our conferences for dealing with international credit, the suggestion of an international loan, the loans actually made to the enemy—are a confession of the international character of that problem. All this shows that the economic question, alike nationally and internationally, is not, it is true, something that ought to occupy all the energies of men, but something that will, unless dealt with adequately; is a question that simply cannot be swept aside with magnificent gestures. Finally, the nature of the settlement actually made by the victor, its characteristic defects, the failure to realise adequately the victor’s dependence on the economic life of the vanquished, show clearly enough that, even in the free democracies, orthodox statecraft did indeed suffer from the misconception which The Great Illusion attributed to it.

What do we see to-day in Europe? Our preponderant military power—overwhelming, irresistible, unquestioned—is impotent to secure the most elementary forms of wealth needed by our people: fuel, food, shelter. France, who in the forty years of her ‘defeat’ had the soundest finances in Europe, is, as a victor over the greatest industrial nation in Europe, all but bankrupt. (The franc has fallen to a discount of over seventy per cent.) All the recurrent threats of extended military occupation fail to secure reparations and indemnities, the restoration of credit, exchange, of general confidence and security.

And just as we are finding that the things necessary for the life of our peoples cannot be secured by military force exercised against foreign nations or a beaten enemy, so are we finding that the same method of force within the limits of the nation used by one group as against another, fails equally. The temper or attitude towards life which leads us to attempt to achieve our end by the forcible imposition of our will upon others, by dictatorship, and to reject agreement, has produced in some degree everywhere revolt and rebellion on the one side, and repression on the other; or a general disruption and the breakdown of the co-operative processes by which mankind lives. All the raw materials of wealth are here on the earth as they were ten years ago. Yet Europe either starves or slips into social chaos, because of the economic difficulty.

In the way of the necessary co-operation stands the Balkanisation of Europe. Why are we Balkanised rather than Federalised? Why do Balkan and other border States fight fiercely over this coalfield or that harbour? Why does France still oppose trade with Russia, and plot for the control of an enlarged Poland or a reactionary Hungary? Why does America now wash her hands of the whole muddle in Europe?

Because everywhere the statesmen and the public believe that if only the power of their State were great enough, they could be independent of rival States, achieve political and economic security and dispense with agreements and obligations.

If they had any vivid sense of the vast dangers to which reliance upon isolated power exposed any State, however great; if they had realised how the prosperity and social peace of their own States depended upon the reconciliation and well-being of the vanquished, the Treaty would have been a very different document, peace would long since have been established with Russia, and the moral foundations of co-operation would be present.

By every road that presented itself, The Great Illusion attempted to reveal the vital interdependence of peoples—within and without the State—and, as a corollary to that interdependence, the very strict limits of the force that can be exercised against any one whose life, and daily—and willing—labour is necessary to us. It was not merely the absence of these ideas but the very active presence of the directly contrary ideas of rival and conflicting interest, which explained the drift that the present writer thought—and said so often—would, unless checked, lead Western civilisation to a vast orgy of physical self-destruction and moral violence and chaos.

The economic conditions which constitute one part of the vindication of The Great Illusion are of course those described in the first part of this book, particularly in the first chapter. All that need be added here are a few suggestions as to the relationship between those conditions and the propositions we are concerned to verify.

As bearing upon the truth of those propositions, we cannot neglect the condition of Germany.

If ever national military power, the sheer efficiency of the military instrument, could ensure a nation’s political and economic security, Germany should have been secure. It was not any lack of the ‘impulse to defence,’ of the ‘manly and virile qualities’ so beloved of the militarist, no tendency to ‘softness,’ no ‘emasculating internationalism’ which betrayed her. She fell because she failed to realise that she too, for all her power, had need of a co-operation throughout the world, which her force could not compel; and that she must secure a certain moral co-operation in her purposes or be defeated. She failed, not for lack of ‘intense nationalism,’ but by reason of it, because the policy which guided the employment of her military instrument had in it too small a regard for the moral factors in the world at large, which might set in motion material forces against her.

It is hardly possible to doubt that the easy victories of 1871 marked the point at which the German spirit took the wrong turning, and rendered her statesmen incapable of seeing the forces which were massing for her destruction. The presence in 1919 of German delegates at Versailles in the capacity of vanquished can only be adequately explained by recalling the presence there of German statesmen as victors in 1871. It took forty years for some of the moral fruits of victory to manifest themselves in the German spirit.

But the very severity of the present German lot is one that lends itself to sophistry. It will be argued: ‘You say that preponderant military power, victory, is ineffective to economic ends. Well, look at the difference between ourselves and Germany. The victors, though they may not flourish, are at least better off than the vanquished. If we are lean, they starve. Our military power is not economically futile.’

If to bring about hardship to ourselves in order that some one else may suffer still greater hardship is an economic gain, then it is untrue to say that conquest is economically futile. But I had assumed that advantage or utility was to be measured by the good to us, not by the harm done to others at our cost. We are arguing for the moment the economic, and not the ethical aspect of the thing. Keep for a moment to those terms. If you were told that an enterprise was going to be extremely profitable and you lost half your fortune in it, you would certainly regard as curious the logic of the reply, that after all you had gained, because others in the same enterprise had lost everything.

We are considering in effect whether the facts show that nations must, in order to provide bread for their people, defeat in war competing nations who otherwise would secure it. But that economic case for the ‘biological inevitability’ of war is destroyed if it is true that, after having beaten the rival nation, we find that we have less bread than before; that the future security of our food is less; and that out of our own diminished store we have to feed a defeated enemy who, before his defeat, managed to feed himself, and helped to feed us as well.

And that is precisely what the present facts reveal.

Reference has already been made to the position of France. In the forty years of her defeat France was the banker of Europe. She exacted tribute in the form of dividends and interest upon investments from Russia, the Near East, Germany herself; exacted it in a form which suited the peculiar genius of her people and added to the security of her social life. She was Germany’s creditor, and managed to secure from her conqueror of 1871 the prompt payment of the debts owing to her. When France was not in a position to compel anything whatsoever from Germany by military force, the financial claims of Frenchmen upon Germany were readily discountable in any market of the world. To-day, the financial claims on Germany, made by a France which is militarily all-powerful, simply cannot be discounted anywhere. The indemnity vouchers, whatever may be the military predominance behind them, are simply not negotiable instruments so long as they depend upon present policy. They are a form of paper which no banker would dream of discounting on their commercial merits.

To-day France stands as the conquerer of the richest ore-fields in the world, of territory which is geographically the industrial centre of Europe; of a vast Empire in Africa and Asia; in a position of predominance in Poland, Hungary, and Rumania. She has acquired through the Reparations Commission such power over the enemy countries as to reduce them almost to the economic position of an Asiatic or African colony. If ever wealth could be conquered, France has conquered it. If political power could really be turned to economic account, France ought to-day to be rich beyond any nation in history. Never was there such an opportunity of turning military power into wealth.

Then why is she bankrupt? Why is France faced by economic and financial difficulties so acute that the situation seems inextricable save by social revolution, a social reconstruction, that is, involving new principles of taxation, directly aiming at the re-distribution of wealth, a re-distribution resisted by the property-owning classes. These, like other classes, have since the Armistice been so persistently fed upon the fable of making the Boche pay, that the government is unable to induce them to face reality.[126]

With a public debt of 233,729 million of francs (about £9,300,000,000, at the pre-war rate of exchange); with the permanent problem of a declining population accentuated by the loss of millions of men killed and wounded in the war, and complicated by the importation of coloured labour; with the exchange value of the franc reduced to sixty in terms of the British pound, and to fifteen in terms of the American dollar,[127] the position of victorious France in the hour of her complete military predominance over Europe seems wellnigh desperate.

She could of course secure very considerable alleviation of her present difficulties if she would consent to the only condition upon which Germany could make a considerable contribution to Reparations; the restoration of German industry. But to that one indispensable condition of indemnity or reparation France will not consent, because the French feel that a flourishing Germany would be a Germany dangerous to the security of France.

In this condition one may recall a part of The Great Illusion case which, more than any other of the ‘preposterous propositions,’ excited derision and scepticism before the War. That was the part dealing with the difficulties of securing an indemnity. In a chapter (of the early 1910 Edition) entitled The Indemnity Futility, occurred these passages:—