Financial Interests
It has already been remarked that the conditions which limit and control the size of armaments are partly geographical and partly financial, and that while the former represent the minimum, the latter stand for the maximum of protective force. I need say nothing further about the geographical conditions. Every one who studies a map can see for himself what is required by a country anxious to protect its shores or its boundaries. If we suppose that armaments are strictly limited to the needs of self-defence, and if we further assume that in the new Europe countries are not animated by the strongest dislikes against one another, but are prepared to live and let live (a tolerably large assumption, I am aware), we can readily imagine a steady process of curtailment in the absolutely necessary armament. Further, if Great Britain gave up its doctrine of the Right of Capture at Sea (and if Great Britain surrendered it, we may be pretty sure that, after Germany has been made powerless, no other country would wish to retain it), the supposed necessity of protecting lines of commerce would disappear and a further reduction in cruisers would take place. I cannot imagine that either America or Japan would wish to revive the Right of Capture theory if we ourselves had given it up. And they are the most important maritime and commercial nations after ourselves.[15]
The financial conditions, however, deserve study because they lead straight to the very heart of the modern bellicose tendencies. In an obvious and superficial sense, financial conditions represent the maximum in the provision of armaments, because ultimately it becomes a question of how much a nation can afford to spend without going bankrupt or being fatally hampered in its expenditure on necessary social reforms. This, however, is not perhaps the most significant point. Financial conditions act much more subtly than this. Why has it grown so imperative on states to have large armies or large navies, or both? Because—so we have been told over and over again—diplomacy cannot speak with effect unless it is backed by power. And what are the main occasions on which diplomacy has to speak effectively? We should be inclined to answer off-hand that it must possess this stentorian power when there is any question about national honour—when the country for whom it speaks is insulted or bullied, or defrauded of its just rights; when treaties are torn up and disregarded; when its plighted word has been given and another nation acts as though no such pledge had been made; when its territory is menaced with invasion and so forth.
[15] As a matter of fact, the United States are opposed to the Capture at Sea principle.
Protection of Financiers
But these justifiable occasions do not exhaust the whole field. Sometimes diplomacy is brought to bear on much more doubtful issues. It is used to support the concession-hunter, and to coerce a relatively powerless nation to grant concessions. It backs up a bank which has financed a company to build railroads or develop the internal resources of a country; or to exploit mines or oil-fields, or to do those thousand-and-one things which constitute what is called "peaceful penetration." Think of the recent dealings with Turkey,[16] and the international rivalry, always suspicious and inflammatory, which has practically divided up her Asiatic dominions between European States—so that Armenia is to belong to Russia, Syria to France, Arabia to Great Britain, and Anatolia and I know not what besides to Germany! Think of the competition for the carrying out of railways in Asia Minor and the constant friction as to which power has obtained, by fair means or foul, the greatest influence! Or let us remember the recent disputes as to the proper floating of a loan to China and the bickering about the Five-Power Group and the determination on the part of the last named that no one else should share the spoil! Or shall we transfer our attention to Mexico, where the severe struggle between the two rival Oil Companies—the Cowdray group and the American group—threw into the shade the quarrel between Huerta and Carranza? These are only a few instances taken at random to illustrate the dealings of modern finance. Relatively small harm would be done if financiers were allowed to fight out their own quarrels. Unfortunately, however, diplomacy is brought in to support this side or that: and ambassadors have to speak in severe terms if a Chinese mandarin does not favour our so-called "nationals," or if corrupt Turkish officials are not sufficiently squeezable to suit our "patriotic" purposes. Our armaments are big not merely to protect the nation's honour, but to provide large dividends for speculative concerns held in private hands.
[16] Turkey has now thrown in her lot with Germany.