tremendous burdens of a modern war without an economic crash. Further,
as already mentioned in another place, there must be a sort of
mobilization in the sphere of commercial politics in order to insure
under all eventualities the supply of the goods necessary for the
material and industrial needs of the country. Finally, preparations for
war must also be made politically; that is to say, efforts must be made
to bring about a favourable political conjuncture, and, so far as
possible, to isolate the first enemy with whom a war is bound to come.
If that cannot be effected, an attempt must he made to win allies, in
whom confidence can be reposed should war break out.


I am not a sufficient expert to pronounce a definite opinion on the
commercial and financial side of the question. In the sphere of
commercial policy especially I cannot even suggest the way in which the
desired end can be obtained. Joint action on the part of the Government
and the great import houses would seem to be indicated. As regards
finance, speaking again from a purely unprofessional standpoint, one may
go so far as to say that it is not only essential to keep the national
household in order, but to maintain the credit of the State, so that, on
the outbreak of war, it may be possible to raise the vast sums of money
required for carrying it on without too onerous conditions.

The credit of State depends essentially on a regulated financial
economy, which insures that the current outgoings are covered by the
current incomings. Other factors are the national wealth, the
indebtedness of the State, and, lastly, the confidence in its productive
and military capabilities.

As regards the first point, I have already pointed out that in a great