Note 1 — Chapter I · OUR DAILY BREAD

But British policy can hardly be called less contradictory. A year after the enactment of a Treaty which quite avowedly was framed for the purpose of checking the development of German trade, we find the unemployment crisis producing on the part of the New Statesman the following comment:—

‘It must be admitted, however, that the present wave of depression and unemployment is far more an international than a national problem. The abolition of “casual labour” and the adoption of a system of “industrial maintenance” would appreciably affect it. The international aspect of the question has always been important, but never so overwhelmingly important as it is to-day.

‘The present great depression, however, is not normal. It is due in the main to the breakdown of credit and the demoralisation of the “exchanges” throughout Europe. France cannot buy locomotives in England if she has to pay 60 francs to the pound sterling. Germany, with an exchange of 260 (instead of the pre-war 20) marks to the pound, can buy scarcely anything. Russia, for other reasons cannot buy at all. And even neutral countries like Sweden and Denmark, which made much money out of the war and whose “exchanges” are fairly normal, are financially almost hors de combat, owing presumably to the ruin of Germany. There appears to be no remedy for this position save the economic rehabilitation of Central Europe.

‘As long as German workmen are unable to exercise their full productive capacity, English workmen will be unemployed. That, at present, is the root of the problem. For the last two years we, as an industrial nation, have been cutting off our nose to spite our face. In so far as we ruin Germany we are ruining ourselves; and in so far as we refuse to trade with revolutionary Russia we are increasing the likelihood of violent upheavals in Great Britain. Sooner or later we shall have to scrap every Treaty that has been signed and begin again the creation of the New Europe on the basis of universal co-operation and mutual aid. Where we have demanded indemnities we must offer loans.

‘A system of international credit—founded necessarily on British credit—is as great a necessity for ourselves as it is for Central Europe. We must finance our customers or lose them and share their ruin, sinking deeper every month into the morass of doles and relief works. That is the main lesson of the present crisis.’—(Jan. 1st, 1921.)