THE end of the Nineteenth Century and the beginning of the Twentieth witnessed a movement to which the name "Social Reform" is commonly applied. It is well to understand clearly what is meant by this term. Until the reign of Money began it was believed by all men that advantage, spiritual and moral as well as material, attaches to the exercise by the individual of certain functions and responsibilities. A man, it was held, ought to be enabled to earn his own and his family's livelihood and ought to make provision for his children, in sickness and in health. The conception of a wage was a quantity of money or of goods which, in the words of the Pope, secured "those sacred rights of the working man which proceed from his dignity as a man and as a Christian."
But the Money power's conception of wages as "costs" put an end to this idea. If the object is not to enable men to sustain their dignity before God and their fellows, but only to keep them alive in such a condition that they can work, then any consideration of spiritual or moral values is beside the mark. Wages, as Disraeli and Chamberlain saw, being subject to the overriding law of cheapness, could never rise above subsistence level, no matter how great might be the productiveness of industry. Wages could never, therefore, sustain continuously such burdens as medical attendance of a really adequate kind and education.
Social Reform was therefore a sop. Money dared not, in the latter part of the Nineteenth Century, shock the consciences of men too far by restoring the conditions against which Robert Owen had protested. But it would not for a moment tolerate the idea that a wage level which had to compete with that of half-civilized or wholly uncivilized peoples should be raised by an avoidable penny. The way out of the difficulty was found in allowing the politicians of Liberal sympathy, so useful otherwise in upholding Free Trade, to vest in the State the whole office of manhood and parenthood.The State would be fairy godfather to the "poor." Having robbed them of their dignity as men and Christians, by handing them over to the mercy of Money, it would educate their children, provide them with doctors, and, if Money no longer needed them, even go so far as to fill their empty bellies. This was the British Parliament's answer to Mammon, and it was an immoral answer.
Social Reform possessed the supreme advantage, from the point of view of Money, that, in its beginnings, it exerted no effect on costs. London was so incredibly rich in those days that it was possible to institute a large number of social services without laying the Money power under any contribution big enough to frighten it. Money, on the contrary, blessed the "reforms," beamed upon them, and spoke of the advantages, in the form of a more efficient type of "labour," which was likely to flow from them.
The insincerity of this attitude may be understood by reference to the present-day attitude of Money towards the social services. Meanwhile it cannot be too fiercely insisted that Social Reform, far from being a blessing to anybody, was a betrayal by Parliament of the nation. It represented the price paid by the Money power for the right to rob the King's Englishmen not only of the fruits of their labour, but also of their dignity as men and Christians, of their office as fathers and husbands, and of their qualities of independence and courage which are the real wealth and credit of this Kingdom.But to say this is not to agree that, as things stand today, "economy" should be exercised at the expense of the social services. Far from it. So long as the Money power remains, the social services ought to be defended by every opponent of that power, since, happily, they have come thanks to the ruin of the world wrought by the Money power itself to constitute a serious hindrance to the operations of International Finance.
England at the beginning of the present Century was no longer the secure citadel of the Money power. That power had been alarmed by the revival of nationalism brought about by the increased influence of the Throne. It had been alarmed, too, by the swift extension of the policies of Social Reform upon which, as has been said, it had looked favourably at the beginning. Education, housing, public health, and factory inspection were now, in changed conditions, adding to costs and so preventing "wholesome measures of deflation," and equally (though unavowed) "wholesome measures of inflation."Booms could no longer be trusted to mount so high, nor slumps to sink so deep.And it is on the extent of the difference between mountain and abyss that "Dutch finance depends for its greatest profits." But much more than all these, the demand for Imperial Unity and Empire Free Trade was growing more insistent every day. Above every other menace was the menace of Chamberlain.
Another question exercised the minds of financiers : Was England safe in the military sense ? The Germans did not think so. They declared openly that the experiences in the Boer War were without value for European warfare on the scale on which they meant to wage it. "The invincible army," said the Kaiser, "cannot be beaten." The faith of the German naval leaders was not less secure. The command of the seas, they boasted, would very soon be wrested from England.
There was witnessed, in the early years of the present Century, a remarkable propaganda in favour of Germany to which a great number of patriotic Englishmen fell victim. This propaganda declared that Germany's intentions were wholly pacific, that she was without designs upon any of her neighbours, and that those who spoke or even made suggestions to the contrary were guilty of the crime of inciting to war. This was the attitude of the greater part of the Liberal party, which preached, quite sincerely, "a better understanding with Germany" and disarmament and which based its hopes on trade relations fostered by the free British market. Another kind of propaganda was conducted at the same time namely, that war was impossible because no nation could afford to wage it. This was an argument advanced with perfect sincerity and favoured by many Liberals. It afforded to large numbers of honest citizens an unwarranted sense of security.
It was into this bewildered world that Mr. Chamberlain launched his policy of Tariff Reform. That part of the British people which had found in Rudyard Kipling an evangelist of Empire and a messenger of hope received gladly the new doctrine ; but the mass of the people, lying still in abject poverty, was unprepared. The campaign was launched in Birmingham on May 15, 1903, at a meeting of Unionists called to welcome their member on the conclusion of his tour in South Africa. Mr. Chamberlain said :
"The Empire is not old. The Empire is new. The Empire is in its infancy. . . . Now what is the meaning of an Empire ? What does it mean to us ? We have had a little experience. We have had a war (the Boer War) a war in which the majority of our children abroad had no apparent direct interest. We had no hold over them, no agreement with them of any kind, and yet, at one time during this war, by their voluntary decision, at least 50,000 colonial soldiers were standing shoulder to shoulder with British troops, displaying a gallantry equal to their own and the keenest intelligence. It is something for a beginning ; and if this country were in danger I mean if we were, as our forefathers were, face to face some day, which Heaven forfend, with some great coalition of hostile nations, when we had, with our backs to the wall, to struggle for our very lives it is my firm conviction that there is nothing within the power of these self-governing colonies that they would not do to come to our aid. . . .
"Now I suppose that you and I are agreed that the British Empire is one and indivisible.You and I are agreed that we absolutely refuse to look upon any of the States that form the British Empire as in any way excluded from any advantage or privilege to which the British Empire is entitled. We may well, therefore, have supposed that an agreement . . . by which Canada does a kindness to us (in the matter of preferential treatment in her markets) was a matter of family arrangement, concerning nobody else. But, unfortunately, Germany thinks otherwise. There is a German Empire. The German Empire is divided into States. Bavaria and, let us say, Hanover, Saxony, and Würtemberg may deal between themselves in any way they please. But in this case of Canada, Germany insists upon treating Canada as though it were a separate country. It refuses to recognize it as a part of our Empire entitled to claim the privileges of that Empire. It regards this as being something more than a domestic agreement, and it has penalized Canada by placing upon Canadian goods an additional duty.
"Now the reason for this is clear. The German newspapers very frankly explain that this is a policy of reprisal and that it is intended to deter other colonies from giving to us the same advantage. Therefore it is not merely punishment inflicted by Germany upon Canada, but it is a threat to South Africa, to Australia, and to New Zealand. This policy, a policy of dictation and interference, is justified by the belief that we are so wedded to our fiscal system that we cannot interfere and that we cannot defend our colonies, and that, in fact, any one of them that attempts to establish any kind of special relations with us does so at its own risk and must be left to bear the brunt of foreign hostility. To my mind, that is putting us in rather a humiliating position I do not like it at all. I know what will follow if we allow it to prevail ; it is easy to predict the consequences. How do you think that under such circumstances we can approach our colonies with appeals to aid us in promoting the union of the Empire or ask them to bear a share of the common burdens ? Are we to say to them : 'This is your Empire, take pride in it, share its privileges' ? They will say, 'What are its privileges ? The privileges appear to be that if we trust you as relations and friends, if we show you kindness, if we give you preference, you, who benefit by our action, can only leave us alone to fight our own battles against those who are offended by our action ?' Now is that Free Trade ? . . . No, it is absolutely a new situation ; there has been nothing like it in our history.
The vigour of the reaction against his Tariff Reform policy surprised Mr. Chamberlain himself. It was not confined to Britain ; it extended throughout Europe and America. The Money power became threatening and every conceivable agency of which use could be made was brought into the field against the author of the "outrage." The Conservative party was split ; Mr. Chamberlain himself resigned his office in order to "go in front of the army as a pioneer." From one end to the other the country rang with challenges and counter-challenges about the food of the people and the attack which " landlordism" was supposed to be making upon it. Mr. Chamberlain continued his campaign and advanced in understanding of the evil which, still unbeknown to him, he was attacking. Thus :
"Take the capitalist the man living upon his income. . . . He can invest his money in foreign countries and live upon the interest ; and then, in the returns of the prosperity of the country, it will be said that the country is growing richer because he is growing richer. But what about the working man ? . . . This is the state of things against which I am protesting."
He went on to speak of a director of the American Steel Trust who, foreseeing a slump, was preparing to "invade foreign markets" when his own market was deflated by ''financial difficulties."
"Remember," Mr. Chamberlain said, "it may not be easy . . . to invade the German market or the French market or the Russian market, because in every case they will find a tariff which, if necessary, can be raised against them. They will go to the only free market ; they will come to this country. . . .
"Since 1882 the total imports of foreign manufacturers (into Great Britain) have increased by £65,000,000."
Liverpool, October 27, 1903 : "Dumping takes place when the country which adopts it has a production which is larger than its own demand. Not being able to dispose of its surplus at home, it dumps it somewhere else. Now the United Kingdom is the only country where this process can be carried on successfully, because we are the only country which keeps open ports.
"Now a curious thing which Mr. Asquith does not seem to appreciate a curious thing to him, but not to us is that 'dumping' only takes place seriously when the country that has recourse to it is in a state of depression."
This was a sword thrust into the enemy's vitals. Mr. Chamberlain's real foe was certainly hidden from him ; nevertheless he had wounded him, for, as has been seen, it is when a market is being deflated by the restriction of credit, so that, for want of the means of exchanging them, goods are tumbling down in price, that producers are compelled to rush their goods into foreign markets that is to say, into the British market.
Mr. Chamberlain, meanwhile, was approaching more and more closely to the position of Disraeli. He expressed regret that his policy imposed so little sacrifice, saying that he felt the importance of sacrifice as part of a life of service. His vision was set upon an Empire in which men and women would receive the fruits of their toil and be rescued from the horrors of those periods of slump when the poor are stripped of their possessions and turned adrift to starve in the middle of plenty.
His appeal failed. In 1906 the Liberals were returned with an overwhelming majority, while soon afterwards Mr. Chamberlain himself was stricken by a fatal illness. His work, however, was not suffered to diminish. In those years after 1906 men's minds in England remained disturbed by the grievous poverty of the "richest land on earth," and the Radical wing of the Liberal party that a to say, the wing farthest removed from Finance under the leadership of Mr. Lloyd George introduced a fresh instalment of Social Reform in the shape of the principle of State Insurance against unemployment and ill-health and instituted the Old Age Pensions. These measures of course met with a strenuous opposition by the Money power, which, in return, was attacked by Mr. Lloyd George, who spoke scathingly of "that area, a mile square, which calls itself the City." The Conservatives, meanwhile kept alive the demand for Protection for the Home Market and Empire Free Trade. England emphatically was becoming unsafe for "Dutch finance" and its twin daughters dumping and starvation.
In these years came the Entente with France and the understanding with Russia. The argument that Germany would be compelled to fight if her goods were excluded from Great Britain and the British Empire was employed by the Money power, which had been glad to coquette with Prussianism and to use the "German bogey" as a means of frightening the English people away from Protection and Empire Free Trade. Having originated and intensified by every conceivable means the scramble for foreign markets, which was one of the causes of the World War, Money began to preach peace and good-will and urge that, even if France should be attacked, England ought to remain outside of the struggle, propaganda very useful to Germany.