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The economics of war, with some arguments for better pay and security for those serving their country online

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THE

ECONOMICS of WAR

WITH SOME ARGUMENTS FOR

BETTER PAY AND SECURITY

FOR THOSE
SERVING THEIR COUNTRY



By
" ECONOMIST "



PRICE THREEPENCE

NET

(The profits on this Pamphlet

will be given to the Prince of

Wales's Fund)



LONDON

P. S. KING & SON

ORCHARD HOUSE, WESTMINSTER

19x4



THE

ECONOMICS OF WAR

WITH SOME ARGUMENTS FOR

BETTER PAY AND SECURITY FOR THOSE
SERVING THEIR COUNTRY



By
" ECONOMIST "



I.

SCARCITY AND DEARNESS OF NECESSARIES

II.

MAINTENANCE OF EMPLOYMENT AND

NATIONAL SERVICE

III.
WAR, AND EDUCATION



LONDON :

P. S. KING 6f SON
ORCHARD HOUSE, WESTMINSTER

1914



V5vJs^



^^L



PREFACE

THE conviction is daily growing that
honour requires us, from our uniquely-
favourable and aloof position in this
war, not only to offer to our allies all our
fighting strength available, but such a bul-
wark of economic stability and elasticity as
they can rest on in their corresponding
economic disaster. From another aspect, at
the very beginning of the war, it was pro-
perly urged : Let not those amongst ourselves,
whose means are narrowest, be allowed more
suffering in the war than falls to the share
of all of us. And these two must clearly be,
during the war, the nation's chief economic
aims.

In these three short papers an attempt is
made to bring into line some of the proposals
advocated from various points of view. For
many they will contain merely what is
obvious : but it is hoped that they will be of
use in helping others . to understand, fit in
with, and assist public policy, as chance offers.



4 •*



\A •



THE ECONOMICS OF WAR

SCARCITY AND DEARNESS OF
NECESSARIES

NECESSARIES of life are bound to become scarce
and scarcer. However much our own six months'
supply, which was said to be in hand at the beginning
of the war, is husbanded, to whatever extent resourcefulness
discovers " necessary " sustenance in hitherto unexpected
quarters, whatever attention is paid to winter crops and
to the mothers of future live stock, whatever insurance
there may be of sea-borne trade and fishing boats, this
scarceness will develop. It is important, firstly, to insist
on the value of all these measures. It is important, secondly,
to face the fact that ultimately the moment may arrive
when, quite apart from rise in prices, scarcity alone will
compel Government to limit the daily ration for all. It is
important, thirdly, to recognise that before that ultimate
moment arrives prices will rise not only from unpatriotic
cornering and taking advantage of scarceness, but from the
inevitable increase of labour and precaution required for
bringing goods to market, and that, though for a while
this upward rise will be too slight to merit public attention,
a preliminary day may also arrive when, in the interests
of those of low wages, it will be advisable for Government
to buy necessaries at a higher price and sell them at a lower.



MAINTENANCE OF EMPLOYMENT
AND NATIONAL SERVICE

MORE complicated is the problem how, with the
least possible machinery and expenditure, to keep
or place all in employment and thus in a position
to obtain a share of such limited amount of necessaries as
is available — in other words, how to keep each particular

333399



THE ECONOMICS OF WAR



person from starvation until all starve together. It is this
aim which is valuably preached in the programme "Business
as Usual ' ' : although in recognising the value of that programme
it must be insisted also that it does not profess to be able
to increase the supply of necessaries (so effective is the demand
for these that, wherever circumstances allow, employment
in their production will continue without any special plead-
ing), and that it does not lead to the achievement of any
work of high national value : it only professes to persuade
people to demand articles of relatively second-rate or even
of no importance, that as many people as possible may remain
in some sort of employment and have that entitlement
to necessaries which employment confers.

Now, even in ordinary times, as is well known, dislocation
from work is of frequent occurrence ; it accompanies, for
instance, most improvements in production, changes in
fashion and in individual expenditure, and especially the
success of one firm or person in attracting custom formerly
held by another ; some trades have some or even all of their
members chronically on the verge of dislocation. The
re-establishment of the dislocated into the economic and
industrial circle is of notoriously painful difficulty ; perhaps,
of all things, is elasticity in this respect at the very root of
a nation's happiness, stability, and capacity for taking a
line in big affairs ; at any rate, big, although imperceptible,
dislocations are gradually becoming recognised as the out-
come of national conditions and therefore proper to be settled
by combined national effort and at national expense. Of
many remedies, the chief hope is, generally, that some new
pressing demand for service will be discovered (say, a new
" booming " country to be developed), into which service
some can throw themselves, earn wages, have satisfiable
demands, require the service of others (who in their turn
will require that of others again), and, as it were by a magic
wand, increase indefinitely the embrace of the industrial
circle. Concentration on one definite direction of service
can thus revivify a whole group of varied workers. And it
is becoming felt that expenditure of taxpayers' money



THE ECONOMICS OF WAR 5

even on some relatively unproductive concern — say, a
dull public building — is both fair and economically justified,
if at a time of need it gives a start to this self-continuing
operation.

In war dislocation is worse than ever, obviously, and even
more than in peace clearly a national matter. As regards
cause : raw material is wanting ; markets fail ; customers
economise ; in spite of precautions to establish finance
and currency on a firm basis, some insecurity is felt. As
regards remedy : both by those who understand the ultimate
effects of assured and well -distributed demand for service,
and by those who see only the employment given by the
first step itself, the commencement of public building is
advocated, for the employment it will afford, at the rate-
payers' and taxpayers' expense ; or it is advocated that
employers should keep on all possible hands — at reduced
wages, if necessary. And, indeed, although no doubt
differing in respect of the usefulness of the work thus achieved,
all these schemes — the Local Government Board Housing
Scheme at £4,000,000, Municipal Building Schemes, " Business
as Usual " — are sound, if expensive, and justifiable (as long
as they do not offer work so obviously useless as to be farcical
and degrading).

It is here that a new standpoint sheds light, and points
to one particular vivifying direction for service, of unique
importance.

Many are feeling, as both against the taxpayer and against
respectable and useful people earning wages, salaries, profits,
in various trades, that those engaged in dangerous war service
are seriously underpaid. This underpayment is more a relic
of years than the result of any maintained theory. It has
perhaps escaped the criticism it deserves, because of the fact
that Continental armies are also poorly paid ; although the
case of conscript armies is quite different, since in them the
sole effect of high pay would be that each man as taxpayer
would be paying himself as soldier. And it deserves especial
criticism in modern days of economic anxiety, since almost



6 THE ECONOMICS OF WAR

every working man who contemplates serving as soldier
has ties he cannot neglect, and hesitates to risk permanent
dislocation from the industrial circle. It would be then
but justice to pay for war service at least the payment of a
skilled workman, with, as part of payment, pension on a
similar scale for a man on disability, and for his dependents
if he were to be killed ; and further to ensure, to those
dislocated from employment, work for the nation, on dis-
charge from war, for at least two years. And to the statesman,
confronted with the necessity of amply paying some selected
public service, to set in motion, all over the country, demand
for further service, seeking some compelling direction in
which to ask men and women to adapt their services, feeling
that he must content himself with buildings or even with the
creation of luxuries, the fulfilment of the above ideal, so far
from seeming impossible, appears as the fulfilment, too,
of his task in the best possible way. If, as may be assumed,
those serving the country are drawn from all parts, the effect
on employment of the receipt, by all dependents of those
serving, of high regular pay would be incalculable.

And such a facing of national obligations would not only
give confidence to the taxpayer, who at present feels shame-
facedly that he is hardly called upon to deny himself a luxury,
but would make us a more adaptable and economically
elastic people for future occasions too. Thus, whether we
now devote our superfluous service straight in the direction
of the needs of war or attempt to supply by its means the
ordinary products of peace time, there is bound to be further
dislocation of some size when war ceases and the expenses
of war have to be made good to the detriment of private
demand for service. And big organised public demand
for service will again be needed to set in motion the wheels
of employment (and, incidentally, the promise of steady
work to those serving in war will be thus redeemable without
further trouble) ; and, again, it can only be the few who can
be selected for immediate work, while to the remainder
can only be offered the opportunity of readjusting themselves
with reasonable facility. And the sooner this question of



THE ECONOMICS Qf W All ,'y 7

capacity for readjustment is faced, not necessarily by indi-
viduals, but rather by trades, the better.

So far there has been no mention of relief — only of the
readjustment of employment, which must, of course, be
first attempted. At the same time, where readjustment
is impossible for any special reason, there is reason for aid —
also, usually, in a special way. Thus, to allow children
to be underfed is admissible on no theory of avoidance
of " mere relief " ; that the difficult task of widows with
small children will be rendered often beyond their powers
is also obvious ; even a small rise in prices will hit over
those invalids who hitherto have just made two ends meet.
On the other hand, to disburse, save in return for valuable
service, money likely to be badly spent, is clearly an unjusti-
fiable waste.



WAR AND EDUCATION

IT is being urged that, where work is scarce and dis-
location pressing, young people to whom earning is not
a necessity should for the time stand down in favour
of those with dependents, and take some part in war service.
The following seems to be the educational side of the matter.

It is generally admitted that in seeking " education M
one is hoping to acquire : (i) Various technical skill fitting
one for life, earning and utility ; (ii) habits of mind and
character, sense of purpose, concentration, ability to face
facts, " know the world," obey limitations, seize opportunities,
understand humanity — to, in short, take hold on life and not
drift.

In ordinary times the above total aims are hard to embody
in any one plan of education. What is right for each one
depends on circumstances and nature. Sometimes the
predominant necessity for firm power and the facing of facts
is the earning of money, at all costs, to help others. Some-
times entry to a congenial profession is securable only by
unceasing preparation for examination, valueless in itsel



8 THE ECONOMICS OF WAR

often, yet " educational " in that it is the right thing to do
under the circumstances. Sometimes — so great for some
is the difficulty of recovery from dislocation — it is " edu-
cational " to abide in whatever niche one has. But others
are free from all three types of limitation. Confidence
in ability and opportunity may point to change as the best
means of development. And, while for some their professions
offer within themselves the means of change, others have
sought it outside their profession and have found the risk
thus taken, in alternating doing with learning, to be justified.

In time of war two particular means of education offer
themselves. Firstly, the economic life of a nation becomes
more intelligible, explicit, and easy to grasp than when
overcast by the conflicting interests of peace time. Thus
the principle that wealth should be the reward of service
stands out then clear-cut and appealing. Secondly, there
are opportunities in war to follow enthusiastic and capable
leadership, in work calling both for discipline and resource,
among those anxious to get the best from one, such as may
otherwise be denied to some whether in education or industry.
Where the limitations mentioned in the previous paragraph
are not in operation, there need be no fear that war service
is " bad for education."



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Online Librarypseud EconomistThe economics of war, with some arguments for better pay and security for those serving their country → online text (page 1 of 1)