Confessions of an Economic Heretic/Chapter 9
CHAPTER IX
POLITICAL AND ECONOMIC CONSEQUENCES OF THE WAR
Though in the pre-War epoch there was widespread discontent with the failure of real wages to rise as they had risen in the preceding periods, the discontent had no revolutionary character. The spirit and traditions of our people had never imbibed the sort of revolutionary spirit prevalent in some continental peoples; partly, because we believed ourselves to possess popular self-government applicable to the bettering of our conditions; partly, because of an element of caution in our character which prevented our resort to quick, simple, and violent remedies. Though, as will be seen, post-War disturbances have had some effect on our traditional attitudes, the failure of our workers, even of aprofessedly Socialist Labour Party, to agree upon any general intelligible policy attests the truth of my assertion that the application of reason and justice to drastic reforms is or appears to lie outside the limits of our national character. It may be that the conservatism of the cliché, “human nature being what it is,” can be overcome by some power of “sudden conversion” in the political-economic mentality. But until and unless that happens it seems foolish either to desire or to fear any “revolutionary” policy in this country.
My pre-War experience, as teacher, journalist, traveller, and general mixer in movements and groups, went to confirm my earlier view that progress would come by a concessionaire policy of the owning classes, together with elements of economic betterment for the workers achieved by public policy and finance. This, at any rate, seemed to be the path to be taken by a people averse alike to idealistic theories and revolutionary practices and conscious of their power to bend their popular Government to meet their urgent economic needs. The temporary stoppage of rising wages during the pre-War period was compensated by old-age pensions, better provision for the poor, and improvements in education, health, and other social services. Though a Labour Party, formally addicted to Socialism, showed signs of growth in all industrial centres and in Parliament, it was not seriously regarded as a menace to the rule of the possessing classes and their Government.
The War struck several blows at this complacency. In the first place, it showed that in British democracy the people and their elected representatives had no effective control over foreign policy with its vital issues of peace and war. Secondly, it showed that while several millions of able-bodied workers were taken from the productive into the destructive services, and the wealth of the nation was lavished recklessly upon the expenses of the War, huge profits were acquired by the owners and managers of the businesses directly or indirectly engaged on armaments, ships, and other favoured industries, while the civilian workers had a higher standard of living than before. Thirdly, it soon became evident that this was no “war to end war,” but an exhibition of unfettered national sovereignty, and that the only way of ending war was through constructive internationalism.
Though the popular enthusiasm for the War and the efforts to fight and work which it involved, together with the voluntary submission to all restrictions and impositions laid down by the War Government, prevented these truths from gaining full recognition, thinking minorities began without delay to organize so as to deal with the menaces to democracy, liberty, and peace.
But before turning to these endeavours to stem the tide of war, it is worth while recording the brief effort to keep this country out made in the days preceding August 1914, by a small Neutrality Group. When war seemed imminent, this group, containing Lord Courtney, Lowes Dickinson, Graham Wallas, Gilbert Murray, and a few others, sought through the Press to get a hearing for neutrality. My only personal contribution to this cause was the annexation of Lord Bryce, just returned from America, whom I tracked on Saturday afternoon to a place in Camden Town where he was personally engaged in unpacking trunks of books. His name would undoubtedly have carried more weight than all the rest of us, if circumstances had not made the attempt too late. Sir Edward Grey’s speech in the House of Commons on Monday made our entry to the War inevitable, and our little Committee dissolved. This was the first of a series of shocks to my belief that the world was inhabited by a reasonable animal.
The most active of anti-war agencies during the War and for some years after was the Union of Democratic Control (for Foreign Policy). Formed in the early autumn of 1914 by a little group of politicians, among whom E. D. Morel, Ramsay MacDonald, A. Ponsonby, C. Trevelyan, Norman Angell were leaders, it soon drew into its ranks scattered groups throughout the country who held that we were dragged into a war by Grey and a secret junta of the Cabinet, and that it was of urgent importance to get as soon as possible a negotiated peace, and to provide Parliament with direct knowledge of and control over all treaties and other engagements which entailed future risks of war. Sitting on the Executive Committee of this Society almost from its beginning, I came to learn a good deal of the doubts and difficulties carried in the term “Democratic Control.” Should a Committee of the House of Commons, representative of all parties, exercise this control? This sounded democratic. But in a party government it would sin against the first principle of governmental responsibility. The Government for internal affairs must also be the Government for external affairs. Important international issues, such as tariffs and commercial treaties, cannot be removed from Government control. But, it was urged, the Commons Committee need not have determinate control; it need only be a source of information for the House and the country. But here, too, there were objections on the ground that necessary diplomacy would be damaged if each step were made public to the House of Commons. Some secrecy was necessary though it should not be carried so far as our engagements with France before the War. Strong views upon this subject, pro and con, held by several of our members, prevented the development and application of the very principle that was our raison d’être. This did not, however, sterilize our activities, it simply drove them into agitation against conscription and in favour of measures for an early peace. But more might have been accomplished, had it not been for the distrust and antipathy which soon appeared between Morel and Ramsay MacDonald. Morel’s audacious flaming oratory and a certain recklessness of consequences repelled the cautious and calculating nature of MacDonald. An atmosphere of conflict thus impaired the unity of the Committee. One of our members rudely described the situation in the language of Oliver Wendell Holmes as that of “two prize bulls in one three-acre lot.” For at that time MacDonald had a dominating personality, and showed a certain jealousy of the masterfulness to which Morel also inclined. There were no open ructions, but after the War was over, and Morel began to make great progress as a Labour politician in the country, winning a Parliamentary seat, the divergence of the two leaders became so evident that, when Morel was left out of the appointments in MacDonald’s first Government, no surprise was felt by those who understood their relations. Morel as Foreign Minister, with fuller knowledge of foreign affairs than any other Labour man, might have made history by easing the peace terms and bettering our relations with Germany. But equally he might have failed through trying to carry us further and faster than we could be persuaded to go. Such speculations are not profitable. I mention them because this incident helped to bring home to me the immense part played by personal factors in those vital issues which demand disinterested consideration for their settlement.
The project of a League of Nations for the preservation of world peace took shape during the first year of the War in the discussions of a small group summoned by G. Lowes Dickinson and Richard Cross under the Chairmanship of Lord Bryce. The idea, of course, was by no means a war-product. It had a distinguished ancestry among European thinkers during several centuries, and a few years before the War was developed by Sir G. Paish and placed before statesmen in America. During the War the idea of a League of Nations to maintain world peace was in the minds of Englishmen like Sir Edward Grey and Americans like Taft, Colonel House, and Wilson. A League of Nations Society was set up on a small scale in 1915 by Lord Parmoor, Lord Courtney, and a few others, afterwards to be merged with the League of Free Nations Association founded early in 1918, so as to form “The League of Nations Union” with Grey as its first President. But the Bryce scheme, published in the spring of 1915,[1] as a result of a long series of discussions, was the first formal draft of the League as brought into political life by the efforts of President Wilson and General Smuts. Service on this Bryce Committee, with my friends Graham Wallas, Hobhouse, and Lowes Dickinson, was my first initiation into the mysteries and delicacies of internationalism as a practical policy.
Though it is not possible here to set forth the full proposals in the Bryce Report, its character is faithfully indicated in the following passage from the “Introduction“:
“The members, then, of our proposed Union would bind themselves by treaty
(1) To refer all disputes that might arise between them, if diplomatic methods of adjustment had failed, either to an arbitral tribunal for judicial decision, or to a council of conciliation and report.
(2) Not to declare war or begin hostilities or hostile preparations until the tribunal has decided, or the council has reported.
(3) To take concerted action, economic and forcible, against any signatory Power that should act in violation of the preceding condition.
(4) To take similar action against any non-signatory Power that should declare war or begin hostilities or hostile preparations against a signatory Power, without first submitting the dispute to peaceable settlement by the method indicated in (1).”
It will be noted that this draft does not propose to apply a sanction to the awards of the Court but only to the refusal of Powers to submit their case to the Court for consideration and award.
The League of Nations Society, formed later on during the War, went further than the Bryce proposals in its application of Sanctions to the awards of the Court, and the American League to Enforce Peace also supported the same policy, though confining it to action against an aggressive member of the League.
The chief interest in the Bryce report is that it rightly measured the assent that could at that time be secured for the idea of international action. To a few of its signatories the inadequacy of this internationalism for the purpose of world security seemed evident. My own view was that our scheme did not take adequate account of the economic inequality of nations, in regard to the resources of the country or of colonies under their control, as a source of discord and strife. This view I set forth at some length in my book Towards International Government,[2] published in the summer of 1915. The pressure exercised by important industrial, commercial, and financial interests in “capitalist” countries upon their Governments to obtain foreign markets for their surplus products and foreign areas of development for their surplus capital, has played a predominant part in that process of imperialism which is an increasing source of conflict between the “haves” and the “have not” nations. Though countries like Germany, entering late upon the capitalist system, long viewed with jealous eyes the huge empire, a quarter of the habitable globe, held by Britain under the titles of Empire, Dominions, Colonies, Protectorates, and spheres of influence, this envy was kept within pacific bounds so long as free and equal access to its markets was maintained. But as soon as the Dominions set restrictions on their markets and upon immigration, while the War converted the whole Empire into a preferential preserve, beginning the cancelment of our Free Trade policy, the division between the “haves” and the “have nots” came into clear consciousness as a lasting cause of discord.
No International Council, such as was proposed, could ignore what seemed to be the chief modern cause of war. For though other more reputable causes — security, pride, prestige — figured in the foreground and inflamed war-passions, the real conflict of vital interests between nations lay in the economic field. This is frequently denied by those who cite the Great War as a non-economic event. But while it is true that the possessive passion has other appeals, it is idle to contend that Alsace-Lorraine, with her natural resources, the Drang nach Osten, the scramble for North Africa, Persia, China, Constantinople, and the access to the Mediterranean, were not economic in their main significance. Such are the really “vital” interests which divide nations, easy and growing access to foods and raw materials, increasing and reliable markets for surplus home products, areas for migration of growing population under their own flag, or free access to foreign areas of profitable development. These economic considerations seemed to me of paramount importance in any project aiming. at an international order. Fair play for the several advanced nations with their expanding trade and population, security for the interests of the backward peoples in areas thus opened to development and migration, and more broadly the utilization of the world’s economic resources for the equal benefit of all mankind — such was the practical ideal which a League of Nations or other international system should envisage and seek to attain.
It was evident to us that such a path involved the existence of an International Government, implying the surrender of important elements of sovereignty by individual States. It has taken eighteen years’ experience of the League of Nations to bring a recognition of this necessity, and the lesson is not yet learnt. But the demand made by Germany for colonies or other enlargements of territory, in order to meet her vital needs for markets and for occupation, is bringing the League to realize that without powers to deal with such demands upon the part of its actual or potential members, it cannot secure the peace of the world. Hence the movement towards economic congresses and schemes for equal distribution of raw materials. But those conferences and schemes will come to nothing so long as they rely upon the willingness of the “have” nations to make concessions to the “have nots.” The request by Germany for a return of her confiscated colonies makes it evident that such altruism will not work. So long as internationalism has no super-sovereignty over nationalism and no power to enforce the international will, the equality of economic opportunity needed for a secure peace is unattainable. The belief entertained by a few laisser-faire politicians and economists that equal access to economic utilities can be attained without any cessions of political ownership or control is not valid. Economic equality demands either a definite cession of colonial possessions by the “haves” to the “have nots,” irrespective of the consent of the inhabitants, or a pooling of all such possessions under an international government. It was not possible in 1919 to endow a League with such sovereign powers. It may still be impracticable, with only three of the seven Great Powers as reliable members. But it would be well to recognize that dependence either upon mutual goodwill or community of interests, is inadequate to get down the barriers to free economic intercourse and to meet the demands for equal access to raw materials and equal rights of migration.
It is becoming more and more evident, also, that a dominant underlying issue is that of population. For though pride of possession may count heavily, the possessive motive rests ultimately upon the vital need of finding food and the land on which to grow it for increasing national populations. If an international government with powers to regulate the supplies of foods and raw materials through free commercial intercourse could also regulate the growth of populations in the different countries, all the chief sources of conflict between nations might disappear. Since this is at present unattainable, a League competent to secure world peace must at any rate be endowed with the right to regulate the rate and direction of the migration of populations so as to promote the best development of world resources with the least disturbance of national life.
Such a League, with the requisite sovereign powers ceded by the member nations, was clearly contemplated by many sanguine promoters of the League, who recognized that without such powers permanent peace could not be secured. The history of the post-War world has, however, shown that none of the Great Powers is yet ready for this necessary surrender of its sovereign rights. It is this perverted nationalism which is now seen to block the path of progress and to threaten the very existence of civilized life. It is this nationalism which prevents politicians and peoples from realizing the vicious nature of the barriers which block trade and impede intercourse between nations. But until the domination of class and economic interests within each nation, which feeds and inspires this nationalism, can be recognized and overcome by an enlightened classless nationalism, a League of Nations will not be endowed with the authority and the power needed for world peace and progress.
The great lesson of the War and the even more important lesson of the Peace thus brought home to me the truth that justice as well as charity begins at home. It is impracticable to hope for peace and justice in international affairs unless the conditions for internal peace and justice within the nations have already been substantially obtained. It was this thought that linked up my special economic studies of over-saving and under-consumption with my wider political and economic outlook. I thus got a glimpse of the ideology of the new situation in which democracy, as hitherto conceived, was destined to be torn between capitalism and proletarianism, each seeking to use the machinery of the State for economic mastery, and driven by the emergency of the conflict to dictatorships of the right or left.
But for some time the atmosphere was very hazy. The prevalent feeling when the War came to an end was that after a time things would settle down in their old grooves, and that after some licking of wounds, the different combatant nations would somewhat shyly resume their earlier relations. Though some foresaw that grave troubles would come from reparations, War debts, and new frontiers, few, if any, had any notion of the disastrous psychological reactions of the post-War blockade and the Versailles Treaty upon the German people.
Most of my associates in the world of politics and journalism lived in an atmosphere of hope. The War had broken many bonds of custom, had evoked a wide sense of comradeship, and made large advances in social reforms possible and politically necessary. “Self-determination” had a captivating sound and the liberation of Poland and other oppressed nationalities seemed an earnest of a new Liberal Europe. Above all, the Russian Revolution appeared to give a fine refutation to the dull doctrine of gradualness. Smuts’s famous statement, “The tents have been struck and the great Caravan of humanity is once more on the march,” was a true expression of this challenge of hope. But the “whither” of the march remained obscure. This hope and obscurity were well illustrated for me on a small scale by the formation of the “1917 Club.” It was the Kerensky revolution of the spring, not the Lenin revolution of October, that initiated the Club, though it did not come into operation until the Communist regime was established. It had no declared aim or object but was a free meeting-place for “advanced” men and women concerned with political and economic reforms, or with new literary or artistic movements. Among the early adherents and contributors to its gatherings were Olive Schreiner, Ramsay MacDonald, Oswald Mosley, Bertrand Russell, H. W. Nevinson, E. M. Forster. Though no political creed was imposed or adopted, most of the members were formally or informally attached to the rising Labour Party, and, as time went on, a strong Communist flavour came to be recognized, especially among the younger members. On the whole, it was regarded as a club of “intellectuals,” and as such reflected the confusion of principles and policies that belonged to any attempt to “understand” and synthesize what was going on in war-sodden Europe.
Having no solid bond of creed or policy but only an “atmosphere,” it outlived its early fervour of spirit and passed into a convenient meeting-place until the financial embarrassments of high rents and low members’ fees, often unpaid, brought it to a close.
Looking back on the pre-War and the War period I recognize that my politics and economics have been influenced by several other weighty personal associations. One of these was John Morley, with whom I was on friendly terms for twenty years, and of whom I saw a good deal during the War period. In many vivid post-lunch conversations he disclosed not only his horror at recent happenings but the nature of Victorian radicalism with its pacific laisser-faire humanitarianism in home and foreign politics. “Yesterday,” he said to me in war-time, “I had a letter from an old friend in which he said, ‘Morley, you once spelt God with a small g. You were right.’” But most of his brilliant talk related to the political past, and helped me much to understand how definitely sundered were economics and politics to the mind of Victorian statesmen. John Bright, able business man, politician, religious moralist of the strictest pattern, was, nevertheless, able to feel it his duty to resist legal attempts to limit factory hours and to safeguard the health of the workers in his mills. Yet Morley once told me that he would rather have been Bright than any other mid-Victorian statesman. Here he probably had in mind, not so much Bright’s opinions as his wonderful power of oratory, a quality to which Morley could never aspire.
Another statesman with whom I had a long friendship and close contact during the War period was J. C. Smuts. Carrying personal introductions to him from two relations who knew him at Cambridge, I saw much of him in my South African visit in 1899, spending much of my time at Pretoria as a visitor in his home. As a statesman he was then “in the making”: his task as State Attorney in conducting the delicate negotiations for Kruger’s government with England was no light one, but he kept up a cheery countenance and a conversation in which commentaries on the Greek drama and the nursing of an infant “Chamberlain killer,” reduced current controversies to a minimum. I did not then perceive how multifarious his abilities were destined to prove, as soldier, statesman, and philosopher. Even when nearly twenty years later I came again into close contact with him as adviser and member of our War Government, I did not realize the strength of the philosophic bent which was to find expression in his work on Holism. But it helped me to realize the impulse which has led several of the ablest statesmen of our time, Balfour, Haldane, Samuel, and Smuts to have recourse to the heights of philosophy as a refuge from the grave new issues pressing into the field of politics.
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Personal contacts with many men and women of advanced political views from “good Liberals” to Socialists and Communists during the immediate post-War period, gradually led me to understand what the War had done to “politics” by exposing its superficial operations and bringing it down to “brass tacks.” Though, as we have seen, the social-economic problems which were sedulously kept in the background throughout the mid-Victorian epoch were beginning to show their heads in the nineties, and to infect party politics with inconvenient extensions of social services, the full significance of a politics in which organized labour sought to use the State for the control of economic life, productive, distributive, consumptive, was made manifest for the first time in the post-War period. Even then its full pressure did not occur until the time of the great depression. For though the decade following the Peace saw mighty changes in the political structure of most European countries, involving the financial and economic ruin of whole classes of the community and setting up new barriers to commercial intercourse, it was not until the world depression that the workers’ demand to control Government and the capitalist resistance of that demand began to divide Europe into “reds” and “whites,” “Fascists” and “Socialists.” This division is very indistinct in England, and even in France, where logic has a fuller sway, there are several modifications of the cleavage. Indeed, everywhere, even in dictatorial countries, there is some pretence of shunning a sheer class cleavage under the cover of national unity.
But it remains true that the Great War and still more the Bad Peace have ripened and speeded up those class economic conflicts which were kept under by party policies of opportunist concessions before 1914. The pretence that capitalism is consistent with a real democracy in which the organized working classes can take their due part in Government, that “gradualness” along the old familiar lines can still suffice, wears thinner and thinner, as the recent course of events discloses.
To present the appearance of democracy, without handing over the reality of government to the people, had long been the unchallenged achievement of the upper classes in Britain and America. The machinery of two-party politics was successfully devoted to this end. How successfully I have shown in Victorian England, but in America the party machinery was even more cleverly applied, being less hampered by traditional allegiances and assisted by the limits of the federal system.