BY ‘DHRUVA’

I

The War was the most tremendous thing that happened to the European peoples. It dissolved four empires and altered the whole face of Europe, It had the profoundest effects on the economic and military situation. It unleashed the fevers of nationalism and the violence of Communism. It was more than a war; it was war and revolution rolled into one. Consequently the post-war period has been one of great disharmony and distress. The real problems have not been solved; the pace of events has been breathless; and after nearly two decades of precarious peace, Europe is again on the verge of war.

To understand the post-war period then, its politics and problems, we must go back to the years before 1914. For the war itself was a product of forces which were working before it broke out and which determined its character: in retrospect the crisis of 1914–9 appears to have been but a major incident in a continuing process.

Before the war, the world was gradually becoming smaller. The colonies had been settled or conquered, the empty places had been filled, and new markets and fields of investment were disappearing. At the same time the steady advance in the sphere of industry was increasing the productive capacity of the capitalist States. In the 19th century England had been the only workshop of the world; in the 20th century there were several. And the problem was: how to dispose of the products of these countries? The internal markets were not sufficient, for any increase in the wage bill increased the cost of production and adversely affected the productive system. On the other hand, foreign markets were rapidly dwindling and the competition for them was the main cause of conflict between the imperialist Powers. So, even before the war, the old ideas of free trade and economic self-adjustment were being slowly given up. Tariffs and protective measures were being forced upon governments.

After the war, things took a turn for the worse. The war had screwed up the productive capacity of the belligerent States to a high degree; but there was no corresponding increase in the extent of markets. On the contrary, the old economic unity in Central Europe was broken up, and the new States were in the grip of economic nationalism. And it was clear that any settlement which aimed at peace in Europe had to make some provision for the distribution of raw materials and a reasonable amount of free trade.

But the Liberal philosophy, which was the dominant philosophy of the pre-war period, did not take adequate account of economic facts. It advocated free trade and non-intervention in the economic sphere, regardless of actual conditions and the disparity in economic strength between the States. It rested on a false division between politics and economics, and laid great emphasis on political equality and liberty without rooting them in economic justice and the removal of inequalities. It was a philosophy mainly of the producer, not of the consumer. And any system which it set up was bound to be defective. The working-classes began to demand more wages and greater participation in the affairs of government. They dimly realised that mere political democracy was not enough. They demanded the extension of the principle of democratic control into the economic and social sphere.

Thus the struggle began to resolve itself into a sort of triangular conflict between the Right, the Centre and the Left: the Centre representing the Liberals who maintained the status quo; the Right consisting of the Conservatives, the reactionaries and the big capitalists who wanted a restoration and an extension of their power; the Left composing of the Socialists and the Communists who fought for social justice and fuller democracy. The struggle took place in every one of the States; at its worst it was a struggle between reaction and revolution; at its mildest between the status quo and reformism. Here and there it was confused; in the Balkans the issues were not clearly defined; in England it was concealed by good form and good manners. But in Germany, France and Italy, the conflict was relentlessly waged. In France where the democratic foundations were secure, politics swayed between increasing doses of reaction and Socialism. The decencies of political life survived. In Germany and Italy where democracy was comparatively new, the struggle ended in the complete success of reaction.

Nor were these dramas played out in isolation. They were closely linked up with the external situation, all the more so because means of communication became rapid and the happenings of one State had swift repercussions in others. The inter-connection between domestic and European politics became so close that even the private prejudices of politicians exercised a profound influence. It made all the difference, for example, whether Rumania had a pro-French or pro-Nazi Foreign Minister. Moreover, as the struggle proceeded, it became largely clear that the right wing in one State had a real community of interests with the right wing in the other States. There was a clash of interests between the national blocs; but the common danger of Socialism and revolution seemed to be a factor for solidarity. And so the conservative elements in the victor States made concessions, when they could, to their counterparts in the defeated countries and supported their position. Correspondingly the left wings in the various States began to recognize their common fighting front and buried their differences in internal and external policies. Thus the national struggle increasingly became an international class struggle.

It is in this context that the history of post-war Europe should be read. Politics are of course more complicated than historical analyses, and it is difficult accurately to describe the agencies of social action. But if we are to grasp even the contours of conflict we should keep the foregoing analysis in mind. It supplies the guiding clues; it answers in some measure the shifting, double-faced policies of the various Powers; it enables us to understand the alignment of forces in Europe today.

Thus, in retrospect, the Versailles system consisting of the Peace treaties and the League Covenant acquires a new significance. It would be a superficial view to maintain that the tragedy of the post-war years could be traced to the iniquities of the Versailles system alone, or conversely, to the break-up of that system. The system itself contained many good elements; inasmuch as it embodied the Liberal philosophy, it was an advance upon the international anarchy of pre-war times. But the system failed to take account of the new facts of economic life; on the contrary, it imposed vindictive conditions on Germany which were ruinous to the economy of Europe. Germany was shorn of her vital industrial areas; a monstrous figure of £6,600 millions was demanded from her as reparation; and to this economic spoliation was added the moral responsibility for the war. New States were created according to the principle of nationality; but the frontiers were drawn regardless of the views of German and Magyar populations. The old economic unity of the Austro-Hungarian Empire was shattered; but no scheme was substituted in its place. A League of Nations envisaged a form of international government, but national sovereignties were left intact. The whole plan was based on Liberal ideas of democracy, nationalism, and sovereignty, plus ruthless measures of economic imperialism. From the beginning it created an impossible situation; it appeared to be the continuation of war with weapons other than force.

So the period immediately following the Peace was one of acute suffering in Europe. There were the problems of demobilization, of the transfer of industry and government from a war to a peace basis, of the minorities in the new States. Frantic attempts at reconstruction had to be made. Productive capacity was everywhere disorganised, currencies were unstable. In England there was a Police, a Railway and a Coal strike. In Germany there was a Royalist putsch in 1920; and in 1922 a National Socialist party was organised by Hitler against the Versailles Treaty and the German Liberals who had signed it. In Italy the Liberal Government collapsed when Mussolini marched on Rome. In Austria bankruptcy was averted at the last moment by the League. And in January 1923 the reactionary government in France, controlled by Big Business, took advantage of the general insecurity and invaded the Ruhr on the pretext of enforcing reparation payment. German currency collapsed and the middle and working classes were rendered destitute.

In 1924, however, the clouds began to lift. The policy of revanche had failed; the policy of cooperation with Germany began to be tried. Moreover, production of foodstuffs and raw materials was on the increase, so that the bourgeois and conservative governments in the west could afford a policy of accommodation, which was initiated by the Labour Government in England and the Radical (Liberal) Government in France. In Germany also there was a liberal-bourgeois Cabinet headed by Stresemann who cooperated with sincerity. In 1924 reparations were scaled down to a reasonable level; in 1925 the Pact of Locarno demilitarised the Rhineland and removed friction between France and Germany; in 1926 Germany was brought into the League. England restored the gold standard and regained her financial primacy; France stabilised her currency and returned to gold. French money was poured into Poland, Yugoslavia and Rumania, and the new States were set on their feet. Everywhere the latest devices in rationalization were adopted. By 1929 the volume of trade and the level of productive capacity were approaching and even surpassing the pre-war level. Europe was settling down to her new conditions.

But there was another side to the picture. Recovery had been made but it was largely an illusion. In France the middle classes were ruined by the stabilization of currency which helped only the heavy industrialists. In England there was a general strike in 1926, and in all the years of recovery unemployment never went below the million mark. But it was in Germany that the recovery was most hollow. To pay reparations the Germans borrowed, and to meet the interest charges they borrowed again. And it was with this fictitious wealth that they laid the foundations of new Germany. Further, with every step in rationalization, numbers were thrown out of work, and the chasm between the industrial and other classes widened. The enemies of the Liberal Government increased, and with the death of Stresemann in 1929 the situation became tense. The Left Wing was splintered into warring, ineffective groups; on the other hand the conservatives and the National Socialists rallied large sections of the middle class against the Government.

In Eastern Europe also the economic position was far from satisfactory. Many of the new States depended on agriculture and were heavily protected against competition from the New World. Prices of foodstuffs were therefore kept at a high level; and the land-owning and industrial classes rigorously put down all movements of hunger and poverty. In Yugoslavia the peasant leader was shot; in Rumania the peasants could not come to power till 1928. Most of the States sustained themselves only with French and American money.

Thus, everywhere in Europe, the period of recovery was one of outward progress but of real insecurity. It rested on thin foundations, on borrowing and unproductive expenditure. If a day came when the influx of foreign capital would cease, the real situation would be exposed, class conflicts would become sharp and a period of terrible unsettlement would follow.

That day came in 1929. The stock exchange fell in New York and soon the crisis spread across the Atlantic. It was a world crisis, the first of its kind, the inevitable result of an anarchical system of production and investment. It at once recalled American money in Europe, leaving a trail of disaster behind it. Austria collapsed. Germany tottered. In England the Labour Government left; in France the Radical Government was kicked out by the Banque de France. In the Balkans where the agricultural countries were the hardest hit, there was panic, followed by royal coups d’ etat.

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