v REPARATION 193

defeated enemy, 1 there is still a fundamental fallacyin the method of calculation. An annual surplusavailable for home investment can only be convertedinto a surplus available for export abroad by aradical change in the kind of work performed.Labour, while it may be available and efficient fordomestic services in Germany, may yet be able tofind no outlet in foreign trade. We are back on thesame question which faced us in our examination ofthe export trade—in ivhat export trade is Germanlabour going to find a greatly increased outlet ?Labour can only be diverted into new channelswith loss of efficiency, and a large expenditure ofcapital. The annual surplus which German labourcan produce for capital improvements at home isno measure, either theoretically or practically, ofthe annual tribute which she can pay abroad.

IV. The Reparation Commission

This body is so remarkable a construction andmay, if it functions at all, exert so wide an influence

1 It cannot bo overlooked, in passing, that in its results on a country'ssurplus productivity a lowering of the standard of life acts both ways.Moreover, we are without experience of the psychology of a white race underconditions little short of servitude. It is, however, generally supposed thatif the whole of a man's surplus production is taken from him, his efficiencyand his industry are diminished. The entrepreneur and the inventor willnot contrive, the trader and shopkeeper will not save, the labourer will nottoil, if the fruits of their industry are set aside, not for the benefit of theirchildren, their old age, their pride, or their position, but for the enjoymentof a foreign conqueror.

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