CAUSES OF DISTRESS.
In spite of Kellogg Pacts and hard spade work done by the League of Nations, in spite of the arduous efforts made by this country and the United States to give aid to Germany and other necessitous countries, the fact remains that all over the world, but in Europe more especially, unrest and a lack of confidence in political security continues, and this in its turn has also impaired international financial confidence and international credit. To some extent the causes themselves are political, but to some- extent they are also economic, and one influence reacts upon the other. So far as the economic causes arc concerned, the bedrock_ fact is that • the nations of the world completely failed at the time and have continued since to fail in an adequate recognition of all that was involved in the outcome of the four years' Great War. In the countries suffering-the chief loss, failure -to realize the:situation has usually taken the form of unreadiness to reduce the standard of living and costs of production, while in the case of the chief creditor nations there .has been failure to recognize not only the magnitude of the losses of other countries but of the repercussions on all centres which -were bound to result from- the depressed condition of so many of the. European and other countries. Reparations and International debts have • been exacted by creditor countries some of whom at one and the same time, by the erection of high tariff walls, have made it impossible for the debtor countries to discharge their obligations through the exchange of goods and services. Again, the two great lending countries—the United States and France having by their Protectionist policy created conditions causing. gold to flow to -those two countries, have completely failed to fill the role formerly filled by Great Britain as the world's banker, and the result has been that countries such as Germany, South America and Australia who need long loans to develop resources and to enable them to discharge external obligations have not had their requirements satisfied, and their precarious position has had a disturbing effect upon all other centres.
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