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.(1*) Of theEuropean countries which formerly possessed a large exportablesurplus, Russia, as much by reason of deficient transport as ofdiminished output, may herself starve.Hungary, apart from herother troubles, has been pillaged by the Roumanians immediatelyafter harvest.Austria will have consumed the whole of her ownharvest for 1919 before the end of the calendar year.The figuresare almost too overwhelming to carry conviction to our minds; ifthey were not quite so bad, our effective belief in them might bestronger.But even when coal can be got and grain harvested, thebreakdown of the European railway system prevents their carriage;and even when goods can be manufactured, the breakdown of theEuropean currency system prevents their sale.I have alreadydescribed the losses, by war and under the armistice surrenders,to the transport system of Germany.But even so, Germany'sposition, taking account of her power of replacement bymanufacture, is probably not so serious as that of some of herneighbours.In Russia (about which, however, we have very littleexact or accurate information) the condition of the rolling-stockis believed to be altogether desperate, and one of the mostfundamental factors in her existing economic disorder.And inPoland, Roumania, and Hungary the position is not much better.Yet modern industrial life essentially depends on efficienttransport facilities, and the population which secured itslivelihood by these means cannot continue to live without them.The breakdown of currency, and the distrust in its purchasingvalue, is an aggravation of these evils which must be discussedin a little more detail in connection with foreign trade.What then is our picture of Europe? A country population ableto support life on the fruits of its own agricultural productionbut without the accustomed surplus for the towns, and also (as aresult of the lack of imported materials and so of variety andamount in the saleable manufactures of the towns) without theusual incentives to market food in return for other wares; anindustrial population unable to keep its strength for lack offood, unable to earn a livelihood for lack of materials, and sounable to make good by imports from abroad the failure ofproductivity at home.Yet, according to Mr Hoover, 'a roughestimate would indicate that the population of Europe is at least100 million greater than can be supported without imports, andmust live by the production and distribution of exports '.The problem of the re-inauguration of the perpetual circle ofproduction and exchange in foreign trade leads me to a necessarydigression on the currency situation of Europe.Lenin is said to have declared that the best way to destroythe capitalist system was to debauch the currency.By acontinuing process of inflation, governments can confiscate,Get any book for free on: www.Abika.com THE ECONOMIC CONSEQUENCES OF THE PEACE104secretly and unobserved, an important part of the wealth of theircitizens.By this method they not only confiscate, but theyconfiscate arbitrarily; and, while the process impoverishes many,it actually enriches some.The sight of this arbitraryrearrangement of riches strikes not only at security, but atconfidence in the equity of the existing distribution of wealth.Those to whom the system brings windfalls, beyond their desertsand even beyond their expectations or desires, become'profiteers,' who are the object of the hatred of thebourgeoisie, whom the inflationism has impoverished, not lessthan of the proletariat.As the inflation proceeds and the realvalue of the currency fluctuates wildly from month to month, allpermanent relations between debtors and creditors, which form theultimate foundation of capitalism, become so utterly disorderedas to be almost meaningless; and the process of wealth-gettingdegenerates into a gamble and a lottery.Lenin was certainly right.There is no subtler, no surermeans of overturning the existing basis of society than todebauch the currency.The process engages all the hidden forcesof economic law on the side of destruction, and does it in amanner which not one man in a million is able to diagnose.In the latter stages of the war all the belligerentgovernments practised, from necessity or incompetence, what aBolshevist might have done from design.Even now, when the war isover, most of them continue out of weakness the samemalpractices.But further, the governments of Europe, being manyof them at this moment reckless in their methods as well as weak,seek to direct on to a class known as 'profiteers' the popularindignation against the more obvious consequences of theirvicious methods.These 'profiteers' are, broadly speaking, theentrepreneur class of capitalists, that is to say, the active andconstructive element in the whole capitalist society, who in aperiod of rapidly rising prices cannot but get rich quick whetherthey wish it or desire it or not.If prices are continuallyrising, every trader who has purchased for stock or owns propertyand plant inevitably makes profits.By directing hatred againstthis class, therefore, the European governments are carrying astep further the fatal process which the subtle mind of Lenin hadconsciously conceived.The profiteers are a consequence and not acause of rising prices.By combining a popular hatred of theclass of entrepreneurs with the blow already given to socialsecurity by the violent and arbitrary disturbance of contract andof the established equilibrium of wealth which is the inevitableresult of inflation, these governments are fast renderingimpossible a continuance of the social and economic order of thenineteenth century.But they have no plan for replacing it.We are thus faced in Europe with the spectacle of anextra-ordinary weakness on the part of the great capitalistclass, which has emerged from the industrial triumphs of thenineteenth century, and seemed a very few years ago ourall-powerful master
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