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The Economic Consequences of the Peace by John Maynard Keynes
page 17 of 243 (06%)

Of the surplus capital goods accumulated by Europe a substantial part
was exported abroad, where its investment made possible the development
of the new resources of food, materials, and transport, and at the same
time enabled the Old World to stake out a claim in the natural wealth
and virgin potentialities of the New. This last factor came to be of the
vastest importance. The Old World employed with an immense prudence the
annual tribute it was thus entitled to draw. The benefit of cheap and
abundant supplies resulting from the new developments which its surplus
capital had made possible, was, it is true, enjoyed and not postponed.
But the greater part of the money interest accruing on these foreign
investments was reinvested and allowed to accumulate, as a reserve (it
was then hoped) against the less happy day when the industrial labor of
Europe could no longer purchase on such easy terms the produce of other
continents, and when the due balance would be threatened between its
historical civilizations and the multiplying races of other climates and
environments. Thus the whole of the European races tended to benefit
alike from the development of new resources whether they pursued their
culture at home or adventured it abroad.

Even before the war, however, the equilibrium thus established between
old civilizations and new resources was being threatened. The prosperity
of Europe was based on the facts that, owing to the large exportable
surplus of foodstuffs in America, she was able to purchase food at a
cheap rate measured in terms of the labor required to produce her own
exports, and that, as a result of her previous investments of capital,
she was entitled to a substantial amount annually without any payment in
return at all. The second of these factors then seemed out of danger,
but, as a result of the growth of population overseas, chiefly in the
United States, the first was not so secure.
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