Part
II: The Mechanism of the Classical Ideal
CHAPTER VII
THE
BID FOR WORLD POWER
TAKING into consideration the fact that all business is at present
carried on with the express purpose of "making money," it might
be imagined that even if the details of the money system were
not matters of general knowledge, at any rate there would be
little room left for discussion in regard to its main principles.
But there is not even elementary consistency and agreement on
the subject. One of the more obvious examples of this is the
confusion which is in evidence in regard to matters of foreign
exchange, and War Reparations.
It
will be remembered that we are constantly being told that Great
Britain, in particular, lives on exports of goods and services.
In orthodox circles there is never any discussion in regard
to this statement. It is regarded as axiomatic. It is how we
become "rich." On the other hand, as a result of the determination
to inflict punishment of all descriptions upon Germany for her
crime of losing the War, and to reward other countries for their
virtue in winning it, severe economic penalties were imposed
by the Treaty of Versailles. These penalties were assessed principally
in terms of currency. It is common knowledge that these penalties,
generally referred to as reparations, have not so far been successfully
inflicted. Germany has herself expressed her willingness to
pay; France in particular amongst her opponents has expressed
her determination to make Germany pay. Germany has printed large
quantities of paper money and has also incidentally greatly
expanded her economic ability to produce, and thus, it might
be imagined, to pay, but the payment has not taken place. The
reason for this is quite simple, and has been explained in many
orthodox quarters. Such payment can only take place by the export
of German goods and services in return for a pledging of German
credit based on the ability to deliver these goods and services.
Notice the grim humour of the situation. At one and the same
time and from one and the same source, it is being stated that
Great Britain can only become rich by exporting goods and services.
Germany, however, can only be penalised and presumably become
poorer by exporting goods and services. A science of finance
and economics which will permit absurdities of this description
to pass almost unnoticed, can hardly fail to produce chaos in
the world. The country on which the "penalty" of reparations
was inflicted is straining every nerve and sinew, not merely
to export an amount equivalent to the money figure attached
to the reparations, but to add to this amount by every means
in her power. Great Britain, which was one of the nations very
vocal in asserting that Germany must pay, is feverishly searching
for methods either by tariffs or otherwise, which will prevent
German goods, which are by common consent the only method by
which Germany can pay, from entering this country, and is providing
Germany with credits - in order that she may import British
coal.
There
must be in every country, a sufficient, if small, minority of
persons who see these absurdities and understand that they proceed,
and can only proceed, from a radically defective or obsolete
financial system. It can only be assumed that the silence of
such persons is either dictated by fear of the results of a
general exposure, or by complicity in the policy which is furthered
by the existing situation.
Considered
merely from the point of view of financial operations, and without
trespassing on the domain of world policy, it is not difficult
to see that every advantage to finance, as a business, lies
in rendering the Reparations Clauses of the Treaty of Versailles
ineffective. To a financier, a country is simply something on
which to base a mortgage. Just as a private estate which is
not mortgaged is, to a money-lender, an excrescence on the landscape,
so a country whose National Debt is not as large as is consistent
with security is an object of solicitude to International Finance.
If Germany's productive capacity for the next twenty years or
so were effectively hypothecated to the service of the allies
who were engaged against her in the late war, it is fairly obvious
that she would not be good security for loans.
For
this reason, if for no other, the efforts of the financial interests
are likely to be directed to obstructing the payment of reparations,
and finally to the cancellation of the obligation to pay them
- a state of affairs which in the existing financial arrangements
would no doubt be signalised by the grant of an "international"
loan to Germany for a reconstruction of which, by all accounts,
she is in no need.*
*
This paragraph was written in 1923. It has been justified
in detail by events. - Note to ....Revised
Edition.
If
this line of argument be accepted, it will no doubt occur to
the reader that the insistence by the United States on the payment
of the British Debt to America would seem to furnish a contradiction.
It must be remembered, however, that it was necessary for someone
to pay war debts, or the repayment of Financial Debt would be
gravely discredited, and that the U.S. Government has so hedged
round the repayment of the sums borrowed, as to make the British
Debt merely a political weapon for the control of British policy.
Further, it is to be remembered that the financial system is
a centralising system; it can only have one logical end, and
that is a world dictatorship. There seems to be little doubt
that the temporary headquarters of this potential world dictatorship
have been moved from country to country several times during
the past five or six centuries. At one time it was in Italy
and specifically in Genoa, then in the Low Countries and Lombardy,
from whence came the Jewish Lombards who gave their name to
Lombard Street. During the eighteenth and nineteenth centuries
it has unquestionably been in London, but there is every indication
that a change of headquarters to New York is contemplated. The
financial and economic crippling of Great Britain, which under
existing methods of finance would be the result of the payment
of a sum of £1,300,000,000, carried out by the process
of purchasing American dollars or State Securities and cancelling
them, would be a logical and necessary step to what is hoped
will be the establishment of a final and indisputable Regency
of the world.
We
may therefore expect to see a greater diplomacy in operation,
having as its objective the psychological, political, and military
isolation of Great Britain contemporaneously with the economic
and industrial emasculation which is at present proceeding.
By forcing a policy of deflation on Great Britain, while at
the same time pursuing a policy of inflation, the powers operating
through the United States Political and Financial Government
have, during the years 1918-1930, succeeded in destroying, to
a considerable extent, the immense increase in productive and
fighting power which existed at the time of the Armistice. A
continual drain of the most skilled mechanics from this country
to America has been the result of the immense disparity between
the wages paid in the two countries during the same period of
time. No pressure has been applied from Washington or Wall Street
to secure a repayment of the indebtedness of any country other
than Great Britain; and, as a result, the onus of unpopularity
has shifted to London in view of the impossibility of meeting
American indebtedness without collecting the sums due from continental
countries.
In
short, it is impossible to doubt that the bid for world control,
which emerged into the open in 1914, and was temporarily foiled
in 1918, has merely shifted from Berlin to Washington and New
York, and that the apparently better relations which exist between
this country and America can only be attributed to a decision
that effective resistance to the fresh attempt is for the moment
impossible. The promptness with which any suggestion of departure
from the imposed financial and fiscal policy has been followed
by a severe fall in the sterling exchange on New York is, I
think, sufficient evidence that the somewhat contemptuous friendliness
which subsists in regard to Anglo-American relations at the
present time can, and will be, replaced by unrelenting severity
at any moment that British policy appears to run contrary to
that of her creditors.
Just
as, in the main, the mass of Germans were merely passive tools
in the policy which resulted in the first Great European War,
so it is no doubt true that the American people, as individuals,
would repudiate personal complicity in any similar plans. If
it is true, as seems probable, that effective resistance to
an imposed group policy is nearly impossible so long as the
group has control of the credit of the individuals composing
it, it is beside the point to pay serious attention to such
a factor. The only line of action which can be effective in
the emergency with which the world is confronted must be one
which can paralyse or break up the group control of credit to
which the majority of individuals in every country have become
helpless slaves; and it is not without interest that the antagonism
between the American people and the United States Government
is crystallizing into an attack on the mutual support given
to each other by the interests symbolised by Wall Street and
Washington.
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