Omaha daily bee., 1915-09-23
The Economics Of War
Professor Political Economy, Columbia university
PART u-Conolunion.
rohn Rstss clars

borrowing great sums and using part OF the
proceeds to sustain the fightng-putung H. as
we're into the maws Of the cannon-has turther
effect which must be traced. Diversion OF activity
from want satisfying to pain and want creating
such Il the economic definition OF war ana the
diversion takes place. not only in the case OF the
men who re fighting but in that OF the men who ara
making munitions weapons. motor-cars' aeropehes
ships. mlnes. torpedoes. and the like There -
great concentration of workers In the mahhe OF
tools for killing II these we're all made In the
countries at war and made day by day as they were
used, the immediate diversion OF labor ana caplts
from productive empioyments would account pFeeu-
cally for nearly ell the economic waste which the
war entails except which results from direct destruc
ton Of life physical power and property The fact
that the governments would have to borrow money
to pay for the military supplies determines when
and how the citizens will have to pay these bllls
by taxation but not the amount OF the bills nor tue
cause that has imposed them on the country Future
labor and capital. well as those OF the present
will be required for paying the debts and the
Of the evil lies in the diversion OF labor ana
capital present and future. from a useful TO de-
structivs mode Of action
Munitions. etc. not all made in the warning
countries. they all made contempOraneously
with the using OF them Foreign loans. as wei
domestic ones, an element In the proolemi
and they signify that an indefinite number OF foreis
ners with their lands and productive appliances are
pressed into the Immediate service of the states Mt
war Imported munitions first taken from exist
ing stocks in neutral lands but these quickly
exhausted the production Of Understanding ma
chinery Is stimulated in the neutral countries and
the pernlcious diversion labor and capital extends
to them.
The payment for the products OF this foreign
industry cannot be made, In tho normal and usual
way by bartering for them other products smutane-
ouslv made In the beIligerent countries For such
purpose labor and capital not at present avail
able, and the fighting states must buy products OF
present foreign labor and capital by paedgtng In
payment for them the products OF future labor and
capital of their citizens. This Is the significance
Of loan In creating capital In practising what
is called abstinence" forego a present enjoy
ment for endless series of smaller future enjoy
ments; they give up the pleasure dollar would
bring for the sake OF what five cents per year
through an endless peroid will do for them. In
borrowing from abroad the states reverse this pro
css, give up indefinite series OF future products
Of labor and capital of their citizens for the
sake of large immediate supply Of products made
abroad. In doing they are often able not merely
to get and greater amount Of war supplies
their citizens alone could make in the time
available but are able TO get and a larger total
OF wealth in general than their citizens. even
in peaceful times. could produce 1t is wealth that
will at acknowledgement, Shells food, etc,
and the legacy that the transaction will l1ve IL the
binding obligation these states 70 keep their own
citizens working for untold period for the foreign
lenders and their heirs.
one effect OF war immediate prlvauon and
when this Is not extreme Il has in the main a
mitigating effect the general evil In extreme
cases 1t is another mode of death-dealing and at
tacks the weak most severely though 1t affects all
during the war lessons the burden which would
otherwise be entsiled on the future.
In the familiar form in which public debts APP
pear to they the by which
generation carries its children childrens chill
dren TO the pawn shop Of the future and there lie
chance that these animate pledges may sooner
later rebel against tho fate which overtakes them
Crushing taxation will rest on peoples having de-
pleted numbers and resources This situation will
afford cogent for many and costly works
OF social betterment, but the states will long be
unable TO afford than a fraction OF them. II
the war shall END with no league OF nations able
In gta tharQ will be al
TO the burdens heretofore entailed by armies and
navies. arsenals and navy yards. forts, training
camps and, last but far from least pensions They
must be provided from depleted resources Though
the present should end tomorrow, this
emulation OF burdens would a serious internal
danger; but Il IL continues through even
year the situation will grave Social betterments
needed and demanded, taxes that make many OF
them mpossibe-here lie material for internal strug-
giles. and every further month of ruinous warfare
will make them more imminent and dangerous. The
total wealth OF Europe might enable II to carry
the war for year or two longer without literal
bankruptcy, but not without burdens that. TO some
OF the citizens might make bankruptcy prefer
able internal security demands msssurebly quick
peril in every additional month OF H.
The most enduring Of all the results OF a
like the present one Is It's effects direct ana indirect
the humanity Of the future The war demon
seeks choice victims The strong. the educated, the
highly trained among laborers perish in great
bers Capital shrinka because the instruments that
constitute II worn and replaced. There 70
not tlne enough for building locomotives. fac
tories. bridges viaducts for making all manner
tools and machines, nor for restoring fields vine
yards, orchards and forests. The whole complex
mechanism OF production Is allowed TO out
without restoration, and the working force OF the
future feels the crushing effect OF ii ali. Because
OF the depletion OF productive appliances strong and
weak young and old. men and women. forced
TO work harder and enjoy less. 1t does not follow
that this evil will never be removed Within third
OF a century after the END OF the desolating Ma
paleonc the level OF life of the working classes
of Europe had taken decidedly upward trend which
continued through the last century OF In
spite OF the vast burden already laid by va the
present century the relief may come. A glance
at the figures which measure the total wealth and
the annual production Of Europe will show the
debts yet incurred may be carried without bank
ruptcy and probably without revolution But let
not ossa be piled Pelion Let another year
OF fierce competition in borrowing money and IN
destroying life and wealth follow the that end
| ing. A second year OF war would mean grave In
ternal danger and Il would be heroic optimism IN,
deed that could discover. after third OF IT, Europe
that would he worth living IN. unless the sheer de-
strucon OF life itself should enable the impoverished
earth to maintain somewhat tolerably the rem.
nant OF Its children.