ECONOMICS OF TIIK WAR. Ill 



classes, if I am correct in assuming that the cost of the neces- 

 saries of Hfe is to be greater then without higher wages, these 

 will also be worse off. I, however, am inclined to the view 

 that wages will have a tendenc}' to increase more or less in 

 proportion to the rise in the cost of living, and the eft'ects of 

 the war should be felt to the greater extent by the leisured class. 



The demand for luxuries has, during the last fifty years. 

 increased enormously, and retrenchment in this regard will, I 

 am convinced, be one of the inevitable consequences of the war. 

 Capital, hitherto invested in the manufacture of articles of 

 luxury may, it is true, be diverted to the production of necessi- 

 ties, but this I am afraid will not effectually stem the increased 

 cost of living. Since the war prices have risen in England by 

 about 27 per cent. 



There is one possible bright side to the war, and that 

 may mean, from a sociological point of view, the introduc- 

 tion of many reforms. For instance, if it were so decreed that, 

 in future, armaments, navies, and all the huge outlay incidental 

 to sustained preparation for war, were to be materially curtailed, 

 this would, to that extent, balance the expenditure on the present 

 Avar. The employment of so much less capital in means of 

 defence and aggression, Avould release a large portion of the 

 national income for devotion to reproductive purposes. 



One of the minor good economic results which may result 

 from this war is the prohibition of the manufacture of vodka. 

 This, it is generally supposed, was the cause of a great deal of 

 misery in Russia — through the over-indulgence in this spirit 

 much impoverishment amongst the peasantry was occasioned. 

 In a lesser degree, the prohibition in France of absinthe may 

 also be to the benefit of that nation ; and, although England has 

 not taken up any Government prohibition in respect to the 

 manufacture of alcohol, still, the example of the King in abstain- 

 ing during the period of the war, may have a very far-reaching 

 effect ujion the nation in permanently reducing any over-indul- 

 gence. Although this may not appear to be an economic point 

 of importance, it has, in reality, a very great bearing upon the 

 tinancial status of the people. 



I have very briefly dealt with a few of the economic pro- 

 blems raised by the war, but my remarks have only touched the 

 fringe of a very wide subject. Almost every aspect of the 

 question is capable of broad treatment. The subject bristles 

 with problems of a most serious nature. The calculations in- 

 volved, and the human interests involved, are staggering in their 

 magnitude. We can only hope that out of great evil some per- 

 manent good will result. The student of political economy has 

 an important part to play, for we shall undoubtedly require the 

 keenest intelligence and foresight in. order to solve the grave 

 problems that the future holds. Only a careful study of the 

 problems before us will ensure that sound judgment and com- 

 mon-sense is brought to bear on these matters. 



