Evening star., 1943-11-09
Economics for Europe

one or the most looking
parts OF the joint communique is
sued by the Moscow conference is
contained in the second paragraph
OF the declaration on Austria. 1t
reads: They (the signatory powers)
declare that they wish to see re-
established a free and independent
Austria and thereby to open the way
for the Austrian people themselves,
as we'll as those neighboring states
which will be faced with similar
problems, to And that political and
economic security which is the only
basis for lasting peace"
The important thing to note in
this statement is that economic Sc
curity Is bracketed with political
security, and that the two are con-
sidered together as the only basis
for lasting peace" This indicates
that the Moscow conferees realized
the vital Importance of economics
in any constructive European settle
ment. And well they might, be-
cause Austria is the most glaring
exhibit OF the shortsightedness of
the Versailles settlement. quarter
century ago, which attempted to
solve Europe's political problems
without due regard for the economic
factors that were involved.
The Versailles treaties established
or confirmed the existence of no less
than twenty-four sovereign states on
the European continent between the
English Channel and the borders of
Soviet Russia, not counting four
principalities too small to be of any
economic significance. The COM
bined area of those two dozen SOW
ereignties was less than two million
square miles-only two thirds the
size of the United States. None of
those sovereign nations was as large
as Texas, while some were extremely
small. Yet, as part of their SOW
ereignty, they had full economic in
dependence. And most OF them used
this freedom to build up tarifr. walls
which at best hindered interconti-
mental trade and which at worst
became political spite fences to in
jure neighbors with whom they we're
on bad terms.
Austria was the most hapless vic
tim OF this economically untenable
system. The republic OF Austria set
up at Versailles was a mere rump of
the former empire OF Austria Hun
gary which, whatever its political
shortcomings, was an economically
stable and balanced entity. Its
capital, Vienna, great city OF some
100000 souls, suddenly denoted
from an imperial metropolis to the
capital Of small country with few
natural resources and only 5000 900
inhabitants, became an economic
monstrosity, while all the other
succession states" of Central Eu-
rope were on a more or less unsound
economic basis. The result was
chronic and growing economic un-
balance and declining social security
which engendered unrest and insta-
bility that favored German penetra-
ton and eventual domination.
The declaration to restore an in
dependent Austria, coupled with
other parts OF. the text, indicate that
the Moscow conference envisages
the retention of political sovereignty
for most European states. But the
history Of the interwar period proves
conclusively that, in the Europe Of
tomorrow, political independence
must be accompanied by economic
independence. Merely to restore a
sovereign Austria hemmed in on
every side by unscalable tarifi walls
would repeat the economic tragedy
which followed the Versailles settle
ment. This means that far-reachine
arrangements must be made, not
merely in the Danube region but
throughout Europe, for at least re-
giona economic groupings creating