THE £2,000,000,000 POLICY
WHEN Mr. Oliver Stanley said at a Mining Associa- tion dinner on Tuesday that " it might be that in the future they would look back on the events they celebrated that night (the selling agreement concluded between the British and German coal industries) as a turning-point not only in the progress of the coal trade of the two countries, not only in the methods of Anglo- German industrial relations, but also in the history and the hopes of the world," he was voicing aspirations that will be universally approved with an optimism that may well be held excessive. The President of the Board of Trade's speech synchronised significantly with the debate which was simultaneously nearing its close in the House of Commons on the expenditure of what will be considerably over k2,000,00o,000 in defensive pre- parations against the eventuality of a war ordained by Germany, even though as a matter of strategy the spear- head of the attack might be Italy. That, admittedly, would be a plausible, but it would not be a fundamentally sound, comment. There are two methods of averting a threatened war. One is to build up a defensive strength so formidable as to discourage all attack ; the other is to develop to the utmost, within the limits set by reason and equity, the normal relationship of mutually profitable trade with the country from which aggression may be feared. Evidence that the British Government, while pursuing the first method with vigour, is not neglecting the second is both welcome and timely.
We have paid too little attention in recent months to forging the bonds of peace, but the steps announced this week are reassuring. The German trade discussions stand by themselves, for they are to be conducted not between Government and Government, but between traders and traders. That statement has to be modified by the fact that in Germany, as in Russia, the private trader must conform to any behest of the State, but nominally at least the delegates of the Federation of British Industries will find in the Reichsgruppe Industrie, with which they are to negotiate, an organisation analogous to their own. The conversations will cover a vast field, for not one industry but all the staple industries are concerned, but while no early agreement can be looked for, the negotiations, if they prosper, will inevitably impress the German group itself, and the far wider public whom its activities affect, with the need for preserving peace in which . trade can flourish and avoiding war in which all normal trade is shattered. The mission which Mr. R. S. Hudson, the Secretary of the Department of Overseas Trade, is undertaking is rather different. He goes to Eastern Europe as a Minister, and his contact is primarily with Governments, first and foremost the Government of Russia. The necessity for that is manifest, for in Russia all foreign trade is controlled by the Government, and Anglo- Russian trade is capable of considerable expansion. Apart from that material consideration the im- portance of establishing closer contact between this country and the Soviet Republic at the present time needs no demonstration.
Such developments do nothing to diminish the immediate necessity for the vast military expenditure which the Government demands, the House of Commons approves and the country soberly but unhesitatingly consents to shoulder. Only one con- dition is exacted, and the Prime Minister has gone far to accede to it—that, while making every necessary preparation to enable us to win a war if it comes, the Government shall display equal vigour and resolution in its attempts to avert a war. Mr Chamberlain showed himself fully conscious of that need in his speech in the Houseof Commons on Tuesday, and though his references to the League of Nations were such as to alienate quite gratuitously sympathies which he had every interest in conciliating, he made welcome reference to the possibility of reaching some arrangement calculated to curb the catastrophic competition in armaments which, if it con- tinues, can end only in something very near universal bankruptcy or universal annihilation. The Prime Minister, it is true, expressed the view that the time was not ripe for a disarmament conference and that an un- successful conference would do more harm than no conference. Few will disagree with him in that ; all that is asked is that such a conference should be kept steadily in view as an essential objective, and the way prepared for it by every means possible. Indeed, if it would improve the atmosphere at all we can well afford to admit frankly that we should have been wise to have taken Herr Hitler's disarmament proposals of 1934 and 1935 more seriously.
But meanwhile there is the bill to face. What it may amount to cannot be foreseen, but since Sir John Simon stated that £1,25o,000,000 had been spent in three years, and that the rate would increase in the two remaining years of the five-years programme, it is clear that £2,000,000,000 is a distinctly conservative estimate of the total, unless a marked and unmistakable relaxation of the international tension makes curtailment of the programme possible. There are no convincing signs of that today, despite a temporary cessation of oratorical polemics by heads of States. No issues present them- selves which could by any canon of reason or morality justify war, but reason and morality are not governing the world's destinies today. Apart from Germany no danger of a European war exists, for Italy by herself could risk no conflict with any Great Power. Between Germany and Great Britain in particular there is a total absence of causes of quarrel. German claims to the colonies continue to be pressed, but Herr Hitler has said repeatedly, and apparently means, that they will not be pressed to the point of war; German treatment of racial and political minorities has aroused deep repro- bation in every quarter of this country, but nothing in the shape of intervention on their behalf has ever been contemplated ; and the quest of both countries for trade may, as has been seen, be converted into an instru- ment for peace rather than a cause of war.
The danger of war none the less exists—with Italian demands on France as a possible starting-point and the implication of Britain and Germany in the hostilities as an inevitable sequel—and it is acute enough to justify to the full all the provision the Government is making. The country will not grudge the cost, but it will and does ask for decisive assurances that it is getting full value for its immense sacrifice—a point on which some just misgivings were expressed in the House on Monday and Tuesday. Meanwhile one reflection is worth em- phasising. The Prime Minister suggested that we might have sufficient confidence to believe a little less readily in the supposed aggressive intentions of other States. Perhaps. However that may be, we should certainly be realists enough to recognise that if we have our difficulties and apprehensions Herr Hitler's and Signor Mussolini's may well be greater. With the possible exception of Hungary they have no willing supperim in Europe. They have behind them populations who hate and fear the idea of war. They have economic and financial problems far more acute than ours. And the possible support of Japan (already involved in a war of the first magnitude) would ill compensate them for the possible antagonism of the United States. The skies are dark, but they are not necessarily darkest to the west of the Rhine.
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