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The third plan of distribution is what may be called the internationalisation of colonies. It is a step in the direction of an international imperialism, as opposed to the nationalistic imperialism of to-day. There have been numerous proposals to secure a machinery for such internationalism in colonies. Especially during the last decade or two many men in Europe and America have come to the conclusion that the danger of the present international scramble for colonies is so great that any change, even though not in itself unassailable, is better than the present anarchy. Even among Socialists the belief is now expressed that the colonial problem is to be solved, not by leaving it alone, but by a concerted action of the Great Powers, which will give each nation the assurance of a certain stake in colonial development, and will lessen the temptation to wage imperialistic wars.

Of the various recent plans two concrete proposals are worth citing. Thus Mr. Walter Lippmann¹³⁵ suggests a permanent international conference of the great powers which would act as a senate to the native legislative body of the backward country, let us say Morocco, and would in time supervise the budget, fix salaries and make appointments. It is hoped by Mr. Lippmann, though not confidently predicted, that such a body would guarantee the open door and give equal opportunities to the investors of all nations in the particular colony. A broader plan, proposed by Mr. H. W. Brailsford¹³⁶ involves the union into a permanent international syndicate of all companies and individuals seeking railroad, mining and other concessions in a backward country.

Fundamentally the plan of Mr. Brailsford is based on the open door for colonial trade and the equal (and automatic) participation of the great nations in colonial investment. "The remedy," he says, "is so simple that only a very clever man could sophisticate himself into missing it, and it is as old as Cobden. It is not necessary to establish universal free trade to stop the rivalry to monopolise colonial markets; it would suffice to declare free trade in the colonies, or even in those which are not self-governing." "It ought not to be utterly beyond the statesmanship of Europe to decree some limited form of colonial free trade by general agreement—to apply it, for example, to Africa." "For the plague of concession-hunting the best expedient would probably be to impose on all the competing national groups in each area the duty of amalgamating in a permanently international syndicate. If one such syndicate controlled all the railways and another all the mines of China and Turkey, a vast cause of national rivalry would be removed. The interests of China and Turkey might be secured by interposing a disinterested council or arbitrator between them and the syndicate to adjust their respective interests. Short of creating a world State or a European federation, the chief constructive work for peace is to establish colonial free trade and internationalise the export of capital."¹³⁷

Both the plans mentioned are limited in scope and difficult of application, but each contains the germ of a possible development. That of Mr. Brailsford seems on the whole the more promising. It is likely that a senate such as is proposed by Mr. Lippmann would go to pieces over the question whether a certain valuable and exclusive concession should go to a French or to a German syndicate or whether a punitive expedition should or should not be sent against the tribes in the interior. On the other hand the plan of Mr. Brailsford, which by no means excludes the other, has the advantage of making once and for all a fixed and certain distribution of all eventual profits and thus effecting a real community of interest among the promoters and investors of all nations. It is an economic rather than a political solution, and it is along the line of a present trend, the evolution of international investment and of economic internationalism generally. It would seem easier for the capitalists of six great nations to form a great international trust for specific purposes than for an international senate to make a multitude of decisions each affecting strong national interests.

A difficulty, inhering in all plans, is that there is no rule of law or morals that will decide how much each nation should secure from the profits of exploitation. To what extent shall American, Dutch, Belgian, Austrian or Japanese capitalists contribute to the international syndicate which is to exploit the backward countries? But this problem, though difficult, is less hopeless than that of equitably distributing colonies en bloc. For there is no principle on which to divide such colonies. Neither national wealth nor population nor the strength of the national army and navy will serve as a criterion, though all perhaps would be factors in determining the shares of the different countries. A still greater difficulty however arises from the fact that the most valuable colonies are already distributed. Even if Germany were to receive a share in Moroccan opportunities, might she not still seek by war to obtain the exclusive possession of the immense French colonial empire. Perhaps no arrangement for a joint exploitation of new and presumably less valuable colonies would wholly satisfy the imperialists of great European powers, so long as the old colonies are so unevenly divided. To satisfy the nations without colonies, some arrangements must also be made for a redistribution of rights in colonies already belonging to the great powers.

But against such redistribution immense forces are opposed. Algeria is now safely French; India has been British for more than a century and a half. Whatever rights are conceded in these countries to foreign investors, whatever division of profits is granted, will be effected only under the political control of the French and British governments. The best concessions have long since been given out, and the nation which has had political control has in the main favoured its own nationals.

The essential problem here, however, is the open door. If the nations without colonies or sufficient agricultural resources at home can sell their products and buy their raw materials on the same terms as do the nations owning colonies, a large part of the present bitterness and discontent would disappear. There are of course two difficulties in the way of the establishment of such an open door. The first is that commerce may be legally free and yet be hampered by a mass of local, illegal discriminations, and the second is that the trend at the present time is opposed to such equality in colonial commerce. The first difficulty is not unsolvable; the second constitutes an obstacle, which will only be removed when the forces making for an internationalisation of colonies become stronger than they are to-day.

Even a settlement of the colonial problem would not solve all the economic questions dividing the nations; equally perplexing difficulties are found nearer home. A generation or two from now Germany might be completely ruined by a refusal on France's part to grant her access to the iron mines of Lorraine. At any moment Russia may prohibit the temporary emigration of agricultural laborers upon whom the prosperity of the East Prussian agriculture largely depends. Italy, Switzerland, Belgium, Holland and other countries can be ruined by adverse tariff legislation. In very few countries is there such a balanced economic structure, such a complete control over the essentials of industry as to render an economic assault by other nations innocuous.

It is not essential, however, in working out an economic concert that all the problems that separate the nations be completely and finally settled. Given a satisfactory solution of the chief difficulties, some way will be sought to prevent secondary problems from leading nations to war. A single instance of a joint successful enterprise of the powers in a single economic field would act as a powerful inducement to attempt joint action in other cases. It is not to be assumed that all the questions dividing Europe are to be solved in a day or by a single decision. What is required is not one plan which will safeguard all the nations all the time but an inclination or desire to afford a measure of economic security to all and a gradual working out of a machinery, which will effect a settlement here and a settlement there and will in the end develop certain general lines of policy. It is not for a single economic setback that nations go to war, nor even because of a slower development than that of rivals; the chief animus is an ever present fear of industrial débacle. Economic insecurity, even more than present economic distress, forces nations to resort to arms. The way out is towards some form of internationalisation of the great external opportunities upon which the home industry of the nation depends.

Is such a development probable? Will the nations in this generation or in five generations agree to make sacrifices to permit their rivals to live? It is a question not lightly to be answered. We cannot be dogmatic concerning the future development of industry and of international relations when we cannot see clearly a dozen years ahead. Yet the very intensity, the almost pathological intensity, of the nationalistic economic struggle to-day is an indication that it may be approaching a change. In the midst of this struggle, there appears below the surface the signs of a growing economic internationalism.

CHAPTER XX
THE FORCES OF INTERNATIONALISM

An internationalism, which will bind the nations together into one economic unit, can be secured only as a result of a further political and economic development, limiting the power and autonomy of the several nations. Without pressure, external or internal, no union or agreement among the nations can be expected. The thirteen American colonies would not have been willing to live together had they been able to live separately, and, similarly, to-day the great powers would make no concessions to internationalism were it safe and profitable to retain a complete liberty of action. But no such plenary independence is longer possible. Forces are at work which circumscribe national autonomy and compel each nation to act with reference to the will of others.

In the case of small nations this tendency is manifest. Belgium before 1914 was a neutralised state, a ward of Europe. It had surrendered its right to declare war or form alliances. Switzerland, Denmark, Norway and Sweden, while preserving their technical liberty, were by their weakness precluded from entering upon policies disapproved by stronger nations. Even the six Great Powers were forced to pool issues. Austria dared not carry out a programme which Germany opposed, nor could Russia or France act without the other's acquiescence. Group policies were substituted for purely nationalistic aims.

Economically a similar interdependence is being created. No nation is wholly self-sufficing. Italy must import coal and iron, Germany cotton, wool, leather and fodder. France requires Germany's coal and Germany the iron of France. A safe access to these markets and sources of raw material can only be assured by alliance with other powers.

The economic dependence of one nation, moreover, influences the policies of its neighbours. The stress of a country suffering from industrial disequilibrium is transmitted to other nations. If, when Germany has exhausted her iron ore, she is prevented from obtaining a supply, let us say from French Lorraine, she will be faced with the alternative of dismantling her works in Westphalia and Silesia or of forcing France to sell ore to her. Germany's stringency will thus vitally affect France's international policy. Equally, if Russia or Austria cannot obtain what it needs from abroad, the nations which close the gates are endangered. Caution alone must prevent a nation from allowing its neighbour to risk starvation. However ill-founded in precedent, the right to secure what it imperatively needs is a right that every people will fight for.

From this political and economic interdependence among nations potentially hostile, there results a vague community of interest in peace. This common interest is strongly reinforced by the staggering costs of modern war. The present conflict is teaching us that Europe cannot continue to live and fight, since more than what it fights for is lost in the fighting. On the other hand it cannot stop fighting until it evolves principles of settlement based on the economic security of the vanquished. What the industrial powers will gain from this conflict is but an insignificant part of its cost. Compared with the billions of dollars which France has spent upon this war, how insignificant are the few tens of millions that she may have gained from a monopolistic administration of her colonies! How little would the open door have cost the successful colonial nations as compared with the losses of this war! Not that colonial administration was the only or the main cause of the conflict; other factors contributed, such as the megalomania of the Pan-Germans. It seems probable, however, that Pan-German fanaticism was rendered infectious only by the fear that Germany was to be economically encircled and undermined. This fear may well outlast the war. A German defeat, however crushing, will not solve the peace problem, for defeat without security means militarism and reaction in Germany, which in turn means militarism and reaction in Europe. The special advantages which the nations, possessing colonies, may in the future secure will be dearly bought at the expense of new wars, as costly and decivilising as that under which we now live.

This is the chief sanction of internationalism, the price which is exacted from both beneficiaries and victims of a narrow nationalistic policy. Whether a liberal internationalism would not pay better, even on the plane of dollars and cents, is a question that admits of but one rational answer.

At this moment¹³⁸ there is small likelihood that that rational answer will be given. Fighting inhibits thinking, and in the allied countries the belief is held that Germany provoked the war through mere wantonness and not because of economic pressure, and that security can come only by ending Prussian militarism. In Germany there is an analogous conception of her opponents.

The theory that the war was merely wanton has the merit of simplicity, but like other simple interpretations, it does not cover the facts. There were in Germany certain current ideas concerning racial dominion, the natural mission of the German and the absolute supremacy and moral self-sufficiency of the State, which intensified the war spirit. The Pan-Germans harangued in press and on platform to a people intoxicated by former military and economic triumphs and rendered susceptible by army discipline to martial intoxication. Had it not been for a real sense of insecurity, however, peaceable Germans would have been less receptive to such martial ideas. For a generation after 1870 Germany, though armed, had been pacific because secure; her economic centre of gravity lay within. It was not until her national interests extended beyond her boundaries that this sense of insecurity arose. Pan-Germanism was the intellectual and emotional expression of an economic malaise.

To boycott Germany after the war will neither decrease her anxiety nor improve the prospects of peace in Europe. Such a "war after the war," as it is now proposed, is a flat denial of the economic interdependence of nations. Its obvious result would be to intensify, rather than moderate, the industrial competition. Driven from the markets of the allies, Germany would be forced to dump her goods into all neutral countries (at the expense of the trade of the boycotting nations), as well as to form a counter economic alliance and if possible a military coalition. A permanent economic injury to the Central Powers would at the first convenient moment provoke military retaliation. And, parenthetically, a nation like Germany, with its growing population and resources, cannot remain crushed. Even if too weak to make headway against a powerful group of nations, it will always be strong enough to act as a make-weight between two opposed coalitions. Thus if England and Russia, no longer united by a common peril, were to clash in the Mediterranean or in Persia, the presence of an economically threatened and therefore bellicose Germany would tend to precipitate hostilities. If a boycotted Germany by an economic or military alliance could detach one or more of her present enemies, the international situation created would be as dangerous as that of 1914.¹³⁹

The argument that economic insecurity does not tend toward war is thus seen to halt on all fours. There is, however, a stronger or at least a more obvious argument against the promotion of economic internationalism. It is the claim that wars are caused by nationalistic strife. If the incessant struggle between nationalities cannot be appeased but must lead again and again to world-wide wars, then it is futile to seek to avert war by the creation of an economic internationalism. No agreement among the great nations about trade or colonies will avail so long as Poles, Bulgars and Southern Slavs can throw the world into war to fulfil their nationalistic aspirations. Until this nationalistic problem is solved no sure advance towards a permanent peace is possible.

Undoubtedly the struggle of subject nationalities to be free, and of independent nations to annex their kin, has been a fruitful source of strife during the last century. The sense of nationality has been intensified by the nation's mobilisation of the economic interests of its citizens; it has become almost pathological as a result of petty nationalistic fragments competing for separate existence. Bulgarians, Greeks and Serbians want the same tract in Macedonia; Roumanians, Italians and Serbs wish to redeem their subject brethren in the Austro-Hungarian Empire; France seeks to rescue the Francophile though German-speaking Alsatians and Lothringians, and Germany would gladly welcome the Dutch and Flemings back to their putative German allegiance. There is no limit to these nationalistic claims; no room for arbitration; no fixed principle to determine to which nation each group shall be awarded. The result, quite apart from any action among the Great Powers, seems war—inevitable and endless.¹⁴⁰

It is impossible to withhold one's admiration for the inspiring fight which oppressed peoples all over the world are making for their independence. We thrill over the old story of the Grecian revolt against Turkey, of the great risorgimento of Italy, of the long slow struggle of Germany to achieve statehood. The century since the Vienna Congress has marked an almost uninterrupted victory for the principle of nationality. Yet though we sympathise with the aspirations of Poles, Finns, Armenians and Bohemians, an unlimited independence cannot always be desired. Nationalities are not sundered geographically, but men of diverse stocks and traditions are interspersed, as though a malign power had wished to make concord forever impossible. Ireland cannot secure autonomy, to say nothing of independence of Great Britain, without encountering Ulster's demand to be independent of Ireland. Similarly a Great Roumania, a Greater Serbia, a Poland, an independent Bohemia can be secured only by denying the equal rights of lesser racial groups. To-day Hungarians misrule the Roumanians of Transylvania; to-morrow a Greater Roumania may misrule the Transylvania Hungarians. The principle of the independence of nationalities collides with itself.

It also collides with overwhelming economic facts. Racially Trieste is semi-Italian, but if Italy acquires the city (and includes it in her customs union), a vast Austrian and German hinterland is deprived of a necessary commercial outlet. Italy can hold the East Adriatic only by smothering Serbia. Moreover many of these foetal nationalities are too weak and geographically too insecure for independent political existence. What reality would attach to an independent Bohemia held in a vice between two hostile German neighbours, and with a German population in its own territory? Even in peace the Teutonic powers could gently strangle the new nation by means of discriminating tariffs.

Finally many of the claims for nationalistic expansion are inspired by a motive quite different from what appears on the surface. What the nation usually wants is not merely its own unredeemed brethren, but more territory and people. Its unredeemed brethren are the easiest to take. But while Roumania demands sovereignty over the Roumanians of Transylvania, she will not let the Bulgarians of the Dobrudja go. In the one case she upholds the sacred principle of nationality; in the other she discards that principle for the sake of a strategic frontier. Serbians and Greeks ask not only for the right to recover their ancient territory but also for the right to rule over Bulgarians and Turks. What they really desire is access to the sea, ample resources for an adequate population, and the national power, without which an independent existence is an illusion.

It is too late to dream of a really independent existence for each pigmy nationality, strewn about in Eastern Europe. In the absence of a Balkan Confederation, Servia, Roumania, Bulgaria, Montenegro and Greece may preserve their separate sovereignties, though only if they submit to the "advice" of greater nations, as Portugal submits to Britain. But for such nations to have conflicting nationalistic aspirations, to wage bloody wars for larger territory and more subjects, is a ridiculous and a tragic situation. Servia, dreaming of the restoration of the empire of Tsar Stephen Dushan, whose armies marched to the walls of Constantinople, Greece aspiring to the Empire of the East, are a menace to the peace of the world. It is doubtful whether all of these ambitious nationalities can even preserve their separate national existence. If the welfare of Europe conflicts with the independence of a Montenegro or a Bohemia, some lesser form of self-government must be discovered.

That lesser form of self-government might be sought in a local autonomy under a federal government. It is not improbable that the political development, of south-eastern Europe for example, will tend towards group organisations based on the co-operation of diverse nationalities and stocks somewhat on the Swiss model. If the political question could be divorced from the question of the economic exploitation of these small nations, and if each nationalistic group were permitted to retain its language, traditions and Kultur, the result might be better than a mere morcellement of south-eastern Europe, with petty nationalities fighting the battles of their big backers. In such a larger Switzerland, each group might be represented in proportion to its numbers, and the worst evils of the present racial contests be avoided.

The important question in the present connection, however, is not what the particular solution is to be, but whether any solution is possible. It need not be a perfect but only a permanent settlement. Such a settlement presupposes a concert among the Great Powers, an agreement concerning their own problems. Given such an agreement, however, the Powers could in time work out a Balkan arrangement, which neither Servia nor Bulgaria, Roumania nor Greece would dare resist. In the end, if the arrangement were definite, practicable, in reasonable conformity with nationalistic lines, and with a strong and certain sanction, the small nations would become resigned. To-day they have boundless ambitions because the division among the Great Powers gives them a chance of realising ambitions, and what ambitions they have not to start with, Austria or Russia will lend to them on short notice. In this sense and to this extent, the nationalistic problem in its worst form is an appendage to the vast struggle between the powers, and it may cease to be provocative of great wars once a basis of agreement is established among these larger nations.

With the best will such a basis of international agreement among the Great Powers cannot be established in a few years. It requires a gradual development, a progressive give and take, a continuous widening of the principle of joint use. An international convention, altering the rules of maritime warfare, would be a long step in this direction; a congress of the nations for opening up the trade of colonies (like our international postal conventions) would be another step. The internationalisation of Panama, Kiel, Gibraltar, Constantinople, would immensely enhance security, and advance the progress of internationalisation. So also an economic convention between France and Germany, or between Germany and Russia, in which reciprocal industrial advantages were accorded. Such specific arrangements, which permit of international interpretation and enforcement, would help to bring about a larger economic internationalism.

But for the real foundations of peace we must look far below the level of all these diplomatic and political arrangements, in the world industry itself. To-day we are still in the full momentum of an economic development that makes for war, but we are also at the beginning of an economic trend towards peace. In the present world-economy the nation is the unit and international friction the rule, but the movement, at what rate we do not know, tends towards a world business in which the unit will be international and there will be peace between partners. We are already in the first beginnings of the internationalism of capital.

This development is in part the cause of a general phenomenon, the growth of an internationalism of class. Each social group seeks to establish relations with similar groups across the border, for the protection of interests that traverse national boundaries. Thus we have a certain internationalism of the wage-earning class, of finance, of various scientific groups. The possibility of this internationalism grows with the integration of the world through commerce, industry, communication and the spread of knowledge.

The most obviously international of social groups is the proletariat. Though sundered on the question of immigration, though (in some countries) nationalistic and even militaristic in spirit, the wage-earners on the whole have less to gain from imperialism and national aggression than have wealthier classes, while they share disproportionately in the burdens that war entails. On the other hand workers have less influence in the making of diplomatic decisions than do their employers. In the end, moreover, their decision, like that of the capitalist class, is chiefly determined by economic forces largely beyond their control. It is the nascent internationalism of capital, not of capitalists or of wage-earners, that is the supreme element making for peace.

We must beware, however, of welcoming all foreign investment as a portent of a growing internationalism of capital. Much that is accounted economic internationalism is in truth merely an extended nationalism, an extra-nationalism. For investments to allay international discord they should create a community of interest between nations potentially hostile. If Britain invested freely in Germany and Germany in Britain there would be created a mutuality of interest which would render peace probable. Each nation would have a stake in the prosperity of the other; each would have given hostages to peace. But when the London financier puts his money in India, Canada or the Argentine, he is not co-operating but competing with potentially hostile nations. The process is an extension of the national economy to outlying districts, a transition to a larger national unit, like that created in the Middle Ages when the free cities ruled adjoining farm territory. Such an economic extension exacerbates national antagonisms and leads to war.

While foreign investment is preponderatingly of this sort, however, there also exist the beginnings of a movement more truly international. The securities of one nation are dealt with upon the stock exchanges of another, capital flows across national borders and great international business concerns are created. The movement in favourable circumstances is likely to accelerate, either by the mutual economic interpenetration of nations, as when the French build factories in Germany or the Germans in France, or by the amalgamation of the capitals of two countries and their use in joint enterprises. The formation of large international syndicates for the exploitation of backward countries, whatever its other consequences, tends towards the creation of a community of interest. If the powers unite, for example, and can agree upon a Chinese loan, a step forward will have been taken towards an internationalism of capital.

The process of trust formation tends in the same direction. As competing industries within a nation frequently end by combining, so in many great industries the competing national units may develop a gentleman's agreement to regulate output and finally may establish an international cartel. Considerable progress has already been made in the division of the international field. A further development along these lines, though not easy, is by no means impossible or even improbable.

We may seek to understand this eventual international evolution of business by visualising a world organisation of the steel industry. Either one corporation might be formed or a common control might be established among national steel companies through an interchange of stock. The result might be somewhat as follows: In the United States we should have an organisation comprising all American steel concerns, its directors representing constituent companies as well as the government, labour and consumers. In its domestic affairs, it would be under governmental jurisdiction. Its capital might amount to a few billion dollars, of which a part would represent holdings of European companies in return for American stock, transferred to European companies.