Government of Tomorrow

ZIMMERN By A. E. Tins compact and dearly written volume* of 240 pages has only one serious fault—and it is a fault on the right side. There is too much meat in it for a single meal. The main theme of the book is that Western civilization is passing through an economic revolution which requires us to modify the whole apparatus of economic ideas and policies that we have inherited from the nineteenth century. The analysis of this change leads the author to the conclusion that the time is not yet ripe for action on a world-scale. The first step is for the Western peoples to understand what is going on and to take appropriate domestic action.

International action will conic later as "the sum of wise domestic policies." The argument is then transferred for over a hundred pages to the domestic field. Here we are presented, in rapid succession, with a series of practical proposals, as interesting as they are controversial. Each of them really requires to be worked out in a small volume or pamphlet for itself.

But it is the international chapters of the book -which demand chief attention, for it is the thesis there worked out which conditions the domestic policies and proposals. The argument starts by pointing out the inherent contra- diction between those two nineteenth-century idols, Free Trade and Nationality in the sense of the Nation-State. Free Trade started by abolishing the ocirol round a town .or a village and went on to assume that it must he an equally good thing to pull down the customs wall around a nation. But this ignored the fact that there is a limit beyond :which the unrestricted movement of goods and men, absolute free trade and free migration, ceases to be compatible with social welfare: In point of- fact it "never was an unmixed good, for even within national frontiers population does not transfer itself easily from one point to another." Thus the working of pure economic law has to adjust itself to considerations of social welfare : national economic policy, resulting from the claims of nationality, corrected the working of economic internationalism.

The author -regards this nineteenth-century adjustment, this fitting of national economic policy into an international framework, as approaching the problem from the wrong end. In his view the social should take precedence of the economic and a nation's international economic policy should be, not a contradiction but an extension of its domestic policy.

With this general principle in his mind he examines the domestic situation among the peoples of Western Europe. The firSt fact that challenges his attention is what he calls

the turn of the tide of population." He finds that all the peoples of Northern and Western Europe " are no longer reproducing themselves fast enough to maintain their popula- tions at the present figure. Within the next ten years or so all these countries will begin to show a decline in popula- tion." and the same will be true of the United States in thirty years' time. The effect. of this is not only to cheek the process of migration, with which we are familiar ; it is also to check the process of foreign investment. Foreign investment from the industrial to the agricultural countries awaited a -steadily increasing demand in the former for the -agricultural products of the latter. In other words, it assumed a state of confidence in the soundness of the invest- ment. Once this confidence is undermined; as it is being .undermined by the facts of population, the tendency is inevitably for the rentier in the industrial country to realize his investments abroad : in this way the whole economic *Government in Transition. By The Rt. Hon. Lord Eustace Percy. (Methuen. is. Ott.) structure built up upon the interdependence of the agri- cultural -and industrial countries begins to crumble.

Is this process inevitable ? ..No, it is possible, in the author's opinion, to reverse it. Steps can be taken to promote the expansion of consuming power in the pre- dominantly agricultural countries. (He does not tell us what steps : presumably large-scale arrangeinents for lending under government guarantee.) But this Will take tithe; fel- " once the momentum Which kept nineteenth-century economic civilization going is removed, it is extraordinarily difficult to start it again." "Have we still time," he asks, " to be gradual ? " If not, we cannot look forward to any automatic lightening of the present depression : we have to face the possibility of " the decay of a whole civilization " with all the misery that this involves for those " orphanS of our misdirected civilization," the unemployed. Yet this

seems inevitable unless the European peoples can free them- selves from the obsession of- political nationalism, from the state of mind- which gives " the Europe of -today the appear. ance of an ill-managed nursery." -

If we can face the problem in time we shall gradually work back from the extreme - interdependence of the nine-

teenth century to a condition in which economic life will be

predominantly local: and in which industry and agriculture will be predominantly small-scale instead of large-seale. The balance between agriculture and industry will no longer be a balance between an. old industrial country such as England and a young agricultural country, like the Argentine. , It will be a balance between two sets of people in the same local community—between those who " can - still expect, whether in industry or in agriculture, to earn -their livelihood exclusively by selling their produce to others and those who must, to an increasing extent, supply their own needs by the ownership and cultivation of land."

Thus far Lord Eustace Percy. The reader . will realize that his book not only .breaks fresh ground but does so. in the fearless manner of the pioneer cutting his way .through

a jungle of inherited ideas and practical, objections. Ills book deserves the widestnttention : it is indeed to be hoped

that the too summary treatment of the main theme will be expanded later. He has injected the population problem once and for all into our present-day discussions about international economic relations ; he may have exaggerated its psychological and economic effects,. but his argument cannot be dismissed. Nor is it an accident that his advocacy of small-scale economic processes and his refusal to take nineteenth-century- economic doctrine as the framework for his political thinking coincide with Mr. Walter Elliot's criticism of interdependence in his Aberdeen Rectorial address, and with the policy underlying that critique.

The weakest part of the book is the failure ..to analyse political nationalism. We are told that it has got to dis- appear ; but we are given no reasons for expecting it to

obey the author's fiat. A closer examination might have shown that it is already disappearing over large portions of Europe, and that the foci of trouble are relatively few, as the isolation of present-day-Germany is making clear. But against this omission must be set the paragraph devoted to 'Soviet Russia, who has " wasted fifteen years in trying to build up within her own vast territories a fresh edition of nineteenth-century industrial imperialism at precisely- the moment when that old order was struggling vainly for survival in 'Europe and America." But, however mistaken he may consider Soviet policy to have been in thus " iinbalaneing agriculture and industry," he is strongly in favour of a *newel of -close economic relations between Russia and -the re- st Of tlie world. '