slump of 1929-30 there is no ground for holding that capitalism in this country, America, and even in France, Germany and Italy, was not earning good profits in most industries. The dislocation and shrinkage of foreign markets, due to the redistribution of territories under the Peace Treaties, the new economic barriers and the-monetary disturbances, did grave damage to certain industries and markets, and involved attempts at national self-sufficiency very wasteful from the standpoint of “division of labour.” But in spite of these obstacles post-war capitalism did not “suffer disastrously” until the rapid growth of its new productivity, with a rise of profits faster than the rise of wages, brought once again the fatal disequilibrium between production and consumption now seen to be the world’s economic peril.
But in arguing the case for maldistribution as the main cause of Imperialism and of the wars which accompany that policy, it is not necessary to contend that capitalism as “an economic system” benefits by war, but only that certain sections of capitalism with political influence at their disposal favour pushful foreign policies that involve the risk of war. This applies not merely to the armaments industries but to most other industries dependent largely upon export and import trades. While it remains true that we do not need to own a country in order to trade with it, the flag still carries certain trading advantages. And those advantages have grown with our new imperial policy of protection and preference, a policy directly due to our recognition of the insufficiency of markets. So long as our wide-flung Empire presented free markets to the traders of foreign nations, the advantages enjoyed by members of the imperial power, by way of contracts for developmental work and official emoluments, were not causes of strong discontent. But the new restrictive
