WAR INDEMNITIES

Dominion, Volume 8, Issue 2425, 1 April 1915, Page 6

WAR INDEMNITIES

Sir, Though I am not responsible or the exaggerated language regarding war indemnities with which I am - cred-' ited in the report supplied to \ou of tlio meeting at Victoria College on Saturday, I desire to maintain {ho ideas which underlie it' and to submit on© or two reasons for your consideration. War indemnities have both eeonoinio and moral cffects, and in the main these scorn devoid of real benefit to those who impose theiu. The imposition of an indemnity upon a defeated Stat© adds to the general impoverishment caused by the war. 1£ tho defeated State be a great trader Ilk© Germany, its customers both neutral and belligerent are also adversely affected. Tho seller cannot sell when the, buyer cannot buy. We can have no desire to penalise neutral States and it is folly to cripple our own producers. -ill indemnity may b© paid either in money (if a. sufficiently long. time b© S v ? u / or , P a yment) or in commodities, if in hard cash, no addition i 6 made to the real wealth of the receiving State, everything is simply bound'to go up in price, roughly in proportion to the addition mad© to the means of exchange. If in commodities, the home producers will cry out so soon as the woollens and cottons, the iron and steel manufacu! r6S J r sll S ai 'i coal, and chemicals of the defeated country com© pouring in. and can be obtained for nest .to nothing. hi 6hort ( the home producers must 6Uffer until the indemnity is fully paid—apd after, because the defeated country will have made fresh markets for its goods in the home country. For a detailed proof of these propositions I would refer you to Norman AngeU'e book, "The Great Illusion." Part I, Chap. VI. , It appears, however, that it 'would be ms© and just to diminish Germany's abilities as a trader, and thereby to penalise neutral and belligerent customers in order to restore to Belgium some of the wealth and working capital which she possessed before the war. Ifr that country, many farm houses, mills, and factories have been comfl*3tely destroyed. Before many Belgians can begin to produce again, their working capital must be restored, and wo feel in honour bound to require this even if by so doing we injure ourselves. No doubt practically the same considerations apply to tho working capital destroyed in France. This aspect of fli© question is briefly considered in a small book entitled "Tho War and Democracy," written by four members of the Workers' Kducational Association (England), and now on sale in New Zealand In your leading article of yesterday you state that "the abasement of .the Pan-German war-makers is the only way of giving the world a lasting peace." This may perhaps be true, but the Pan-German war-makers ! are not the German people. The German Social Democrats represent, I believe, one-third of tha voting strength of the German Empire. Prince von Bulow, in his book "Imperial Germany," describes them as "the antithesis of the Prussian State," and the Kaiser has called 'them "the enemies of Empire and Fatherland." For the most part the Social Democrats seem to have joined whole-heartedly in ISie war. This appears to indicate that they believe Germany has been attack- ' ed by Russia (whose civilisation they despise), and that England and Franc© i have joined in league against tlieir country. They are in their own oyos sincerely and honestly defending their native land. Those who have lived in Germany say that the Germans are not a cruel people nor a nation of cutthroats., They have.been led and guided and publicly organised in arms and learning by a Prussian bureaucracy. It is the bureaucracy which must b© crushed, not the German people. The idea of • doing this by indemnities and by British Empire Trade Leagues seems essentially Prussian in spirit. That way lies tho continuance of fear and hatred and the armed camp. In the day of our victory Germany will no doubt be greatly exhausted, and there are those who say that when that time comes tho German people will be more than a match for the Prussian junker. In any caeo the uprisings in Europe since the Congress of Vienna in 1815 ' ought to teach us that it is only the German people who can set their own house in order and effectively deal with their War Lord and his advisers. Interference from without is likely lo have tho very opposite effect to that intended. When the great settlement is made there should bo some room for a generous spirit, for the hope of a lasting peace depends ultimately not on the abasement of Prussia, but on the creation of confidence and good faith instead of fear and mistrust in international relationships. If such an atmosphere can be created now, the hope of a lasting settlement grows brighter, arid the hands of our- diplomats will ba guided .and strengthened at tho international council taolo. Yet one and all who think thus will agree with you, Sir, that w© must, fight this... war through without fainting or faltering until wo win.—l am, etc., D. STANLEY-SMITH. "Wellington, 31st March, 1915. TWe did not discuss the economic effect of indemnities in our article. We stated that there would be no injustice in compelling, Germany to pay an adequate indemnity, and that, as a matter of fact, justice demands that she should bo mad© to pay for the frightful destruction she has wrought in France and Belgium. Mr. Smith makes no attempt to controvert these statements, but tries to Bhow that indemniites would penalise neutral States and tend to cripple our own producers.]