Commerce is simply and purely the exchange of one product for another. If the British manufacturer can make cloth, or cutlery, or machinery, or pottery, or ships cheaper or better than his rivals, he will obtain the trade; if he cannot, if his goods are inferior or dearer, or appeal less to his customers, his rivals will secure the trade, and the possession of Dreadnoughts will make not a whit of difference. Switzerland, without a single Dreadnought, will drive him out of the market even of his own colonies, as, indeed, she is driving him out.[14] The factors which really constitute prosperity have not the remotest connection with military or naval power, all our political jargon notwithstanding. To destroy the commerce of forty million people Germany would have to destroy Britain's coal and iron mines, to destroy the energy, character, and resourcefulness of its population; to destroy, in short, the determination of forty million people to make their living by the work of their hands. Were we not hypnotized by this extraordinary illusion, we should accept as a matter of course that the prosperity of a people depends upon such facts as the natural wealth of the country in which they live, their social discipline and industrial character, the result of years, of generations, of centuries, it may be, of tradition and slow, elaborate, selective processes; and, in addition to all these deep-seated elementary factors, upon countless commercial and financial ramifications—a special technical capacity for such-and-such a manufacture, a special aptitude for meeting the peculiarities of such and-such a market, the efficient equipment of elaborately constructed workshops, the existence of a population trained to given trades—a training not infrequently involving years, and even generations, of effort. All this, according to Mr. Harrison, is to go for nothing, and Germany is to be able to replace it in the twinkling of an eye, and forty million people are to sit down helplessly because Germany has been victorious at sea. On the morrow of her marvellous victory Germany is by some sort of miracle to find shipyards, foundries, cotton-mills, looms, factories, coal and iron mines, and all their equipment, suddenly created in order to take the trade that the most successful manufacturers and traders in the world have been generations in building up. Germany is to be able suddenly to produce three or four times what her population has hitherto been able to produce; for she must either do that or leave the markets which England has supplied heretofore still available to English effort. What has really fed these forty millions, who are to starve on the morrow of Germany's naval victory, is the fact that the coal and iron exported by them have been sent in one form or another to populations which need those products. Is that need suddenly to cease, or are the forty millions suddenly to be struck with some sort of paralysis, that all this vast industry is coming to an end? What has the defeat of English ships at sea to do with the fact that the Canadian farmer wants to buy English manufactures and pay for them with his wheat? It may be true that Germany could stop the importation of that wheat. But why should she want to do so? How would it benefit her people to do so? By what sort of miracle is she suddenly to be able to supply products which have kept forty million people busy? By what sort of miracle is she suddenly to be able to double her industrial population? And by what sort of miracle is she to be able to consume the wheat, because if she cannot take the wheat the Canadian cannot buy her products? I am aware that all this is elementary, that it is economics in words of one syllable; but what are the economics of Mr. Harrison and those who think like him when he talks in the strain of the passage that I have just quoted?
There is just one other possible meaning that the English patriot may have in his mind. He may plead that great military and naval establishments do not exist for the purpose of the conquest of territory or of destroying a rival's trade, but for "protecting" or indirectly aiding trade and industry. We are allowed to infer that in some not clearly defined way a great Power can aid the trade of its citizens by the use of the prestige which a great navy and a great army bring, and by exercising bargaining power, in the matter of tariffs, with other nations. But again the condition of the small nations in Europe gives the lie to this assumption.
It is evident that the neutral does not buy English products and refuse Germany's because England has a larger navy. If one can imagine the representatives of an English and a German firm meeting in the office of a merchant in Argentina, or Brazil, or Bulgaria, or Finland, both of them selling cutlery, the German is not going to secure the order because he is able to show the Argentinian, or the Brazilian, or the Bulgarian, or the Finn that Germany has twelve Dreadnoughts and England only eight. The German will take the order if, on the whole, he can make a more advantageous offer to the prospective buyer, and for no other reason whatsoever, and the buyer will go to the merchant of any nation whatever, whether he be German, or Swiss, or Belgian, or British, irrespective of the armies and navies which may lie behind the nationality of the seller. Nor does it appear that armies and navies weigh in the least when it comes to a question of a tariff bargain. Switzerland wages a tariff war with Germany, and wins. The whole history of the trade of the small nations shows that the political prestige of the great ones gives them practically no commercial advantage.
We continually talk as though carrying trade were in some special sense the result of the growth of a great navy, but Norway has a carrying trade which, relatively to her population, is nearly three times as great as Britain's, and the same reasons which would make it impossible for another nation to confiscate the gold reserve of the Bank of England would make it impossible for another nation to confiscate British shipping on the morrow of a British naval defeat. In what way can her carrying trade or any other trade be said to depend upon military power?
As I write these lines there comes to my notice a series of articles in the London Daily Mail, written by Mr. F.A. McKenzie, explaining how it is that England is losing the trade of Canada. In one article he quotes a number of Canadian merchants:
"We buy very little direct from England," said Mr. Harry McGee, one of the vice-presidents of the company, in answer to my questions. "We keep a staff in London of twenty, supervising our European purchases, but the orders go mostly to France, Germany, and Switzerland, and not to England."
And in a further article he notes that many orders are going to Belgium. Now the question arises: What more can a navy do that it has not done for England in Canada? And yet the trade goes to Switzerland and Belgium. Is England going to protect herself against the commercial "aggression" of Switzerland by building a dozen more Dreadnoughts? Suppose she could conquer Switzerland and Belgium with her Dreadnoughts, would not the trade of Switzerland and Belgium go on all the same? Her arms have brought her Canada—but no monopoly of the Canadian orders, which go, in part, to Switzerland.
If the traders of little nations can snap their fingers at the great war lords, why do British traders need Dreadnoughts? If Swiss commercial prosperity is secure from the aggression of a neighbor who outweighs Switzerland in military power a hundred to one, how comes it that the trade and industry, the very life-bread of her children, as Mr. Harrison would have us believe, of the greatest nation in history is in danger of imminent annihilation the moment she loses her military predominance?
If the statesmen of Europe would tell us how the military power of a great nation is used to advance the commercial interest of its citizens, would explain to us the modus operandi, and not refer us to large and vague phrases about "exercising due weight in the councils of the nations," we might accept their philosophy. But, until they do so, we are surely justified in assuming that their political terminology is simply a survival—an inheritance from a state of things which has, in fact, passed away.
It is facts of the nature of those I have instanced which constitute the real protection of the small State, and which are bound as they gain in general recognition to constitute the real protection from outside aggression of all States, great or small.