economic reality. It is, in itself, a mental, not a physical fact. "A"
owes "B" a debt; he goes bankrupt and pays a dividend, a fraction of his
debt, and gets his discharge. "B's" feelings, as we novelists used to
say, are "better imagined than described"; he does his best to satisfy
himself that "A" can pay no more, and then "A" and "B" both go about
their business again.

In England, if "A" is a sufficiently poor man not to be formidable, and
has gone bankrupt on a small scale, he gets squeezed ferociously to
extract the last farthing from him; he may find himself in jail and his
home utterly smashed up. If he is a richer man, and has failed on a
larger scale, our law is more sympathetic, and he gets off much more
easily. Often his creditors find it advisable to arrange with him so
that he will still carry on with his bankrupt concern. They find it is
better to allow him to carry on than to smash him up.

There are countless men in the world living very comfortably indeed, and
running businesses that were once their own property for their
creditors. There are still more who have written off princely debts and
do not seem to be a "ha'p'orth the worse." And their creditors have
found a balm in time and philosophy. Bankruptcy is only painful and
destructive to small people and helpless people; but then for them
everything is painful and destructive; it can be a very light matter to
big people; it may be almost painless to a State.

If England went bankrupt in the completest way to-morrow, and repudiated
all its debts both as a nation and as a community of individuals, if it
declared, if I may use a self-contradictory phrase, a permanent
moratorium, there would be not an acre of ploughed land in the country,
not a yard of cloth or a loaf of bread the less for that. There would be