122 SECTIONAL ADDRESSES. 



international trade in manufactures. British business men in 1919-20 

 have not, I believe, often sent their goods abroad in hope of finding 

 a vent for them, and then been forced to content themselves with 

 prices far below cost of production, as their grandfathers were in 1814-16. 

 Every kind of financial device — long private credit, assistance from 

 banks, credits given by Governments — has been called in, so that trade 

 may be resumed before the war-damaged nations are in a position to 

 pay for what they need by exporting the produce of their own labour. 

 The more industrial the damaged nation is, the more complex is the 

 restarting of her economic activity. Corn grows in nine months, and 

 pigs breed fast. Tlie start once given, countries like Denmark and 

 Serbia, both of which are normally great exporters of pigs or bacon, 

 could soon pay for necessary imports of machinery or fertilisers bought 

 on long credit to restart their rural industries. The United Kingdom, 

 the least damaged of all the combatants except America, is believed 

 by the Chancellor of the Exchequer to be now rather more than paying 

 its way. That may be sanguine, but at the worst our accounts are 

 nearly balanced. What might not have happened in 1919 if modern 

 methods for postponing payment had not been applied internationally ? 

 The other chief combatants are far from paying their way. Italy is 

 importing abnormal quantities of "food and also her necessary raw 

 matei-ials with the aid of American and English credits, while Germany, 

 who can get little in the way of credit, has hardly begun even to import 

 the raw materials to make the goods by the export of which she may 

 eventually pay her way, not to mention her indemnities. I have in 

 mind such materials as cotton, wool, rubber, copper, oil-seeds, and 

 hides — all of which she imported heavily in 1913. Some materials, 

 of course, she possesses in abundance, but the working up even of these 

 is hampered by lier coal position. I make no political pleas: I merely 

 illustrate the complexity of the restarting of industry under present- 

 day conditions. France has the first claim to assistance in restarting, a 

 claim which we all recognise; but for the comfort and peace of the 

 world a universal restart is desirable. 



The central problem is one which I can only indicate here, not 

 discuss. Its discussion is for experts with full inside knowledge from 

 month to month, and the answer varies for eveiy comitry. It is — when 

 will the inability of the war-damaged nations to pay for all that they 

 want, in food and materials, in order to restart full economic activity, 

 make itself felt by the nations who are supplying them, primarily, that 

 is, the United States and ourselves? In 1814-16, when the problem 

 was, of course, infinitely smaller because nations were so nmch more 

 self-sufficing, the reaction came at once for lack of long organised 

 credits. Conceivably, all other combatants might do in turn what we 

 seem to have done — that is, adjust their trade balance within a reason- 

 able period and so avoid renewal of special credits. In that case the 

 post-war trade slump would come, not as an international crisis, but as a 

 gradual decline, when the first abnormal demand for goods of all kinds 

 to replenish stocks is over. Already this type of demand is slackening 

 'n certain quarters. We shall do vei-y well if we have nothing worse 

 than that gradual decline, which would be eased, in our case, by our 



