imports over exports was apparently provided, first, by interest on
investments in other countries--Englishmen having provided capital all
over the world--and, second, by freights. A large amount of these
foreign investments has been sold. How far shall we still be a creditor
country after the War? As regards freights, British shipping has
suffered very heavy losses. One of the first duties both during and
after the War must be to repair the losses and increase British tonnage
available for trade. To this end no effort should be spared, and the
State should do all that is possible to foster shipbuilding, or even
undertake the work itself, if possible without interfering, as
unfortunately it has already done, with the output of private
shipbuilding yards.

As regards national as well as State expenditure, it will be essential,
first, to increase the income, and second, to guard against every form
of waste. To increase the income the only way is to increase production
both from the land and the factory (_a_) of things needed for use at
home, (_b_) of things which can be sold abroad, i.e., exported in
exchange for the supplies that must be imported. In both cases it is
necessary to consider not merely the increase in the amount produced or
the volume of trade, but how far are the articles produced for home use
or imported from abroad of real value in promoting the healthy life of
the nation, how far are they things that are really needed. Books on
political economy have sometimes stated that only "value in exchange is
to be considered"; "value in use" is still more important. We want to
ascertain the things that will really do us good, and devote our
energies to the production and importation of such things. The teachings
of the physiologist as to food values, the study of hygiene in its
widest sense, must form part of political economy in the true sense as
well as the laws of supply and demand or the theory of wages or of