Ten years after

by Philip Gibbs

The German People

In Germany it was not so bad—but bad. For the last year of the war the people had been reduced to the bare limits of food supply. After the war, when the blockade was maintained until the signature of peace, the children went without milk and fats and there was general shortness of provisions, not amounting to actual starvation, but weakening the working men and women. Factory workmen told me that they never ate meat, and existed on bread and potatoes. It was enough for life, they said, but not enough for physical strength. They felt tired. Women fainted in the tramcars. There was stinting and scraping in every home, except those of the “profiteers,” who by some genius of finance were making a good thing out of the fall of the mark.

Coming across Europe like that, and seeing the spreading track of financial and commercial ruin, the lowering of the standard of life in many countries where it had been high and splendid, the loss of purchasing power for anything but the barest necessities, and all the new frontiers and customs lines between new States and old States, checking the free interchange of goods, slowing down world trade, an observer like myself was staggered by the gravity of this state of things. It seemed to me that we were all heading for disaster. I was convinced that all those fair promises of quick prosperity, German reparations, revival of British trade, stabilising of international exchanges, would be utterly falsified unless there was a new co-operation among the countries of Europe on lines of economic commonsense, and a truce to the policy of demanding from the defeated countries immense sums of money beyond their ability to pay. It seemed to me very clear that if Germany went down into real economic disaster the whole of Europe would go down too, and that what was wanted most was not payment of fantastic reparations but a return to the normal exchange of goods and energy. I was afraid for England.

The British Illusion

The British Government, after the Armistice and the uncertain Peace, had behaved for a while as though victory had re-established her old strength. Superficially, indeed, and in moral prestige, among the nations of the world, the British Empire had emerged stronger than before the war. The menace of the German fleet was at the bottom of the sea. New territories in Africa had come under British dominion. British spheres of influence had been extended through Palestine, Mesopotamia and Persia. But those new “mandates” were a source of weakness and not of power. They were very costly at a time when there was no money to spend on new adventures in Imperialism. At least the vast sums of money poured into Mesopotamia and other Eastern territories on extravagant administration and development could not be justified to British taxpayers confronted by a staggering bill of costs for war purposes which drained the old reserves of wealth. British statesmen, not yet taught the elementary lessons of economic law, behaved with a kind of splendid madness, as though a new Golden Age had arrived in which their people would possess an Oriental Empire such as Alexander had carved out of the old world. They forgot, or did not know, that poverty and something like industrial ruin was creeping over English life. They did not realise that after a devastating war they could not call upon the last reserves of manhood to support military adventures in far lands. They did not understand that the effects of war in Europe from the Rhine to the Volga, and beyond, had so lowered the purchasing power of the defeated peoples, the neutral countries and the new States, that Great Britain, for a long time to come, would lose many of her old markets for the export trade upon which her life depended, as well as the shipping of the world’s merchandise from port to port which had been so great a source of her old wealth. Winston Churchill, with his restless imagination and wide-reaching Imperialism dreamed dreams of British rule extending from the Cape to Cairo and from Tooting to Tibet. Even Lloyd George, for a little while, was intoxicated with the magnificence of the victory in which he claimed a chief share, not to be denied in history in spite of some blunders and a feud with the Army Chiefs.

The Lesson of Reality

Then, quicker than in France, all this illusion was smashed in the face by reality. The British nation became aware of its dwindling trade, the stagnation of its industry. Unemployment began to creep up in a steady tide, until two million men were out of work and existing only on Government “doles.” Factories were closing down or working half time. The Mersey, the Clyde and the Thames were crowded with ships without cargoes, and all the ports were filled with seamen without berths. After demobilisation ex-officers as well as men could not find jobs to do. They tramped the streets in search of work, wearing out their boots and their hearts. They played piano-organs, moved in dismal processions with banners flying the words “We want work,” shook street collecting boxes in the faces of the passers-by. The Trade Unions were hard and selfish. They refused to admit untrained labour to their ranks. Without Trade Union tickets men who had saved the country were turned away at the factory gates. Labour put up a fierce fight to maintain the standard of wages and of life which had been established in time of war—no longer possible in time of peace with failing markets and a world in ruin. One cannot blame them. None of us likes to reduce his standard of life and go back to miserable conditions of stint and scrape. Strikes and lockouts beat them down, but did not relieve the strain or increase the nation’s wealth. Things looked very serious below the surface of English life. There was a bitterness in the minds of men who had been promised great rewards for heroic service, and now found themselves destitute, in overcrowded slums—where were the “homes for heroes”?—maintained on a miserable “dole” that just saved them from starvation but was not enough for decent life. There was for a year or so a danger of revolt, a spreading of revolutionary ideas, among men like that. Russian Communism put a spell upon many minds who knew nothing of the agony in Russia but were stirred by the Bolshevik doctrine of equality and the “dictatorship of the proletariat.”

When Germany failed to pay the immense reparations which had been demanded from her the British Government was faced with the necessity of balancing its yearly Budget without those payments, and, unlike France, which still banked upon them, or like Germany, which created false money by inflation, determined to sustain the national credit by taxation and sound finance. It put the most tremendous burden upon the nation that has ever been sustained by any people in modern history. It was accepted with a resignation and courage which will stand for ever to the credit of the British folk, and especially to the credit of those who paid at the cost of all that was dearest to them in life apart from national honour and family blood. Income Tax, Super Tax, and Death Duties fell upon the people who lived on inherited wealth with a terrifying ferocity. There are only two and a half million people in Great Britain who pay any Income Tax at all, and only eighty-five thousand who are subject to Super Tax, but it was from that small minority that the Government demanded the revenue necessary for the upkeep of its services. It caused, and is causing, a social revolution which is changing the whole aspect of English life. The old aristocracy are abandoning their houses, selling their estates, becoming shabby genteel, losing their old splendour, prerogatives and power. To pay their Income Tax and Death Duties they are eating into their old capital, selling the old pictures on their walls, abandoning old mansions haunted by the ghosts of history in which their pride and spirit dwelt. They have done this not without anguish, not without a sense of tragedy, not without bitterness, but with an acknowledgment of inevitable necessity. Bloodlessly the revolution in England is being accomplished, though the hard road has not yet been travelled to the end.

The Price of War

More crippling in its effects upon the nation as a whole was the taxation of capital in trade and industry. At a time when it was most necessary to limit the costs of production and to stimulate the adventure of trade, the business world was crushed under a burden of taxation which limited its reserves, put heavy charges upon the cost of manufacture, and reduced the capital available for new enterprise. The price of war, and of victory, lay with an almost intolerable weight upon the spirit of the British people, even before they had to shoulder the burden—rejected by every other nation—the payment of War Debt to the United States of America, amounting to £35,000,000 sterling every year. With an export trade less than 75 per cent. of what it reached before the War, with a population which had increased by nearly two millions in spite of all the slaughter, with new and ruinous expenses, and with a higher standard of life demanded by the labouring class, the people of Great Britain breathed hard, became very anxious, faced up to realities, and saw, with almost blinding clarity of vision, that their own national life depended upon the peace and recovery of Europe, including that of Germany and the defeated peoples. This realisation changed their whole attitude of mind towards the problem of peace. It made them draw farther and farther away from the French policy of Poincaré, which was based upon the prevention of German recovery and “security” by military force. But above all these financial considerations England believed in fair play even to a defeated foe, in generosity rather than vengeance, and in future peace by conciliation rather than by a military combination which one day would be challenged in another “inevitable” war, more ghastly than the last. All that sounded like weakness and treachery to the mind of France. The Entente Cordiale was strained and broken....