The War and Commerce
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The Empire Club of Canada Addresses (Toronto, Canada), 26 Mar 1915, p. 123-133


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Foster, Hon. Sir George, Speaker
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Text
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A few remarks with reference to the war which is at present raging, and commerce as it is affected by the war. Disclaiming the idea that war is a promoter of commerce. War as an enemy of commerce. Denying the German contention that they have been forced into this war because of Britain's jealousy of German progress in industry and commerce, and that the war was forced upon them by Great Britain for the purpose of destroying Germany's trade. Not disposed after the experience of the last eight months to put very much reliance on the statements of the German government as excuses for their action in the war, or as causes of the war itself. Looking at the last 35 years and finding that Great Britain has dealt in a particularly generous way with the commercial development of Germany. Britain as a "good sport"; Germany as a "bad sport." Commerce acting quietly, unlike war upon which the attention of the world is riveted. Commerce reading more like a romance. Commerce depending absolutely upon production, in turn stimulated by demand. What commerce is. The modern nature of commerce. Transportation as the mechanism of modern commerce. The mechanism of transport today as opposed to 3-4,000 years ago. Broadly speaking, the two kinds of production, beneficent production being illustrated by farmers' work, the other called by the speaker a maleficent production. An explication. The destructive nature of war. Hoping that we are working towards a time of no war. "In all production it is the purpose which hallows the activity." The tremendous effect upon commerce that the present war is having, and to what that is due. The sensitivity of commerce to the effects of war. The wheels of commerce stopping when this war broke out. The mechanism of commerce absolutely paralysed in all its parts, with illustrative examples. Germany's present loss, and what she is likely to lose. Germany's treatment of Belgium and the far-reaching consequences of such treatment. A nation's inability to go far in the great international race if the feelings engendered by such triumphs of atrocity as that are widespread, and are amongst the deepest and strongest held in the human heart. The resources of the world that will be called upon for reconstruction. Canada's opportunity as a fair one. Canada's right to consider her resources, to organise her forces, and to systematise them so that her products and her industries may find their way to these desolated spots with credit and profit to herself and also as contributing to the great work of world-building.
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26 Mar 1915
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English
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Full Text
THE WAR AND COMMERCE
AN ADDRESS BY HON. SIR GEORGE FOSTER, M.P.
Before the Empire Club of Canada, Toronto, March 26, 1915

MR. PRESIDENT AND GENTLEMEN,--I have, in a suggestive way, and without any very great detail, to make a few remarks with reference to the war which is at present raging, and commerce as it is affected by the war.

In the first place, I want to disclaim the idea that war is a promoter of commerce. To my mind, war has always been, is now, and always will be, not a promoter but an enemy of commerce, opposed to all its best interests, and affecting them in the long run in an adverse way, whatever may be said of incidental advantages for limited periods. After that disclaimer I wish to deny the German contention, put forward persistently now and for the past six or eight months, that they have been forced into this war because of Britain's jealousy of German progress in industry and commerce, and that the war was forced upon them by Great Britain for the purpose of destroying Germany's trade, and so getting rid of a hated and very strong rival in the realms of commerce. We are not disposed, after an experience of eight months, to put very much reliance on the statements put forward by the German government as excuses for their action in the war, or as causes of the war itself, and this statement is certainly as unfounded as any of their statements of causes or motives. If you will take the last thirty-five years, you will find that Great Britain has dealt in a particularly generous way with the commercial development of Germany. It is not on record that the British market, which is one of the most profitable of all Germany's markets, has ever been shut to Germany and its products. Britain has given a free market, a market of almost inestimable value, to German products during the last thirty-five years, and has given that market on terms just as free, just as open, just as advantageous as to members of her own Empire, and to the people who live within the boundaries of Great Britain itself. That does not look very much like a jealous rivalry running to unreasonable lengths against Germany's commercial development. If you go outside Great Britain to her dependencies, and take the history of the Overseas Dominions, while it is true that the Dominions have given a preference to Great Britain in their markets, I can tell you from my knowledge of what has transpired with reference to Canada, and it is equally true with regard to the other Overseas Dominions, that this preference to Great Britain over German products has been given to Great Britain not because of one least little bit of an intimation that she would like to have it so, but has been given by these Overseas Dominions from their own initiative entirely. History does not record one single instance of a sphere of influence having been opened in China, in Africa, in any other part of the world, in which Britain has not stood for equal commercial rights in that sphere of influence, giving them to Germany just as freely and just as generously as she has given them to herself, claiming no more for herself than she has given to Germany. There is not a single instance on record of a German merchant ship in any quarter of the world having been hindered or hampered by the British fleet or by British governmental authority all these thirty-five years. Let these facts of themselves tend to reassure any of us who may have heard that argument used that there is nothing in it. The facts absolutely disprove it. Britain always plays fair. She is a sporting nation in this as in other respects, she likes to play the game, and she likes to play it with those that will contest the game with the greatest tenacity. If she wins she does not boast, and if she is beaten she is always ready to acknowledge that better men were against her in the contest. I do not think that the same can be said in respect to Germany in trade, in politics, or in war. In all these they are poor sports.

War is a spectacular thing, and whenever it occurs the attention of the world is riveted upon it. Commerce acts quietly. She makes her advance unobtrusively and peacefully, but when we come to look at long-spaced distances in time and contrast them, there is no page in the whole history of the world which reads more like a romance than the page which records the birth, growth, and expansion and the exceedingly great development of commerce. Unless we actually space off a long distance of time and. make the contrast between commerce then and commerce now, we do not get an adequate idea of what has been done.

Commerce, after all, depends absolutely upon production, and production in turn is stimulated by demand. Commerce is simply the carrying of articles to and fro, the interchange of products, one for another. Without production you can have no commerce. Demand comes in and applies its stimulus to productivity. The demand for what is necessary for the world to live, to be clothed, and to be warmed, is the primitive demand which first impels to production. But there is a wonderful deal of production which is stimulated outside of the demands of necessity, and which in turn makes demand all the greater by the abundance of, supply. Beyond the necessaries of life, it is the rule that men buy according to their desires, and their desires are quickened by what they see of what is produced, and which they believe will contribute to their comfort, to their happiness, and to their upbuilding. So that to say that commerce is based upon production and demand, I think, puts us pretty surely upon the real foundations of commerce.

Now it is production which has been the really wonderful thing in this great world of ours, and commerce has grown only as production has grown. Back two or three or four thousand years ago, and how little of modern commerce was known. The productive areas were localised; exchange was restricted, there was no mechanism which served, so to speak, to mobilise the products of the world, produced as they were in the different and widely separated localities of the world. That mechanism is transportation. Three or four thousand years ago, transport was confined almost exclusively to the canoe pack, the man pack, and the animal pack, and with this limited capacity people bought and sold over limited areas. Today look at the mechanism of transport. By sea the great flotillas of immense vessels, leviathans instead of canoes, coursing all waters of the world, taking the smallest products, raised by the smallest producer, loading them into their spacious holds, and carrying them tens of thousands of miles to where demand waits to be supplied. This one matter of water transport, in its volume and capacity, differentiates us from the old world of 4000 years ago by millions of miles of enterprise and skill and constructive ability, and of all that has resulted from the union of these three in multiplying the great carrying process of the world. For the man pack and the mule pack by land, what have we today? We have the immense system of railroads running from almost every centre of production, and carrying to every distant point of possible demand. The man pack and the mule pack of three thousand years ago, if they were all put together, would not carry what one small system of railways carries today. But those are only portions of the mechanism of commerce. In the early days, as you all know, people could do nothing but barter. One man had more horses than he wanted, and another had more cows than he wanted, and the two swapped their horses and cows. That was very limited dealing. Then gradually token money came to help, then crude methods of exchange, and now you have this immense and complex system of credits, of banking facilities, of bills and cheques, and of various paper instruments, so that gold now lies in the vault and does not make the rounds of the world, except occasionally between certain great centres, whilst based on that gold is a perfect system of credits which moves faultlessly and unerringly the products of the world from every remotest corner to every mart where supply meets the final demand. May I suggest that it would be a good thing for our young men to think over and study deeply the sweep and mission of commerce, because I am certain that a great many of us do not know what a noble instrumentality this world commerce is, and what a potent part it plays in the vital productivities of the world. The two together are twins that can never be disjoined; as long as they work in unison and harmony the world's work is carried on.

Now there are two kinds of production-I am speaking broadly, and not on very detailed lines-and as an illustration of one kind of production we may take the farmers' work. In the preparation of the soil, the sowing of the seed, through all the processes, until the final product is ready for the ultimate consumer, there is not one single maleficent influence. Nor when it reaches the consumer does it stop its beneficent course. It goes to my legal friend here, furnishes food for body and brain, and he is nurtured and strengthened for the arduous work and business of his profession. It goes into the hands of the artist; he is fed, strengthened in body and brain, and fitted to embody the creations of his imagination.

And so the farmers' work, beneficent in itself, feeds and stimulates to further effort and development in every department of world work, and is thus subsidiary to the higher forces of production in all the industrial, social, and artistic lines of life. There is not an unbeneficent influence in it from start to finish.

But production may proceed along other lines and have other ends and aims. It may employ thousands of hands, work up valuable results, put them into certain forms, and these forms may be used for the destruction of material substance, of human fibre, and the mental and moral quality of man. That is what I call maleficent production. We can make a broad distinction between beneficent and maleficent production, and once we grasp that difference we have a foundation for the best action, the best legislation, and the best conservation for human kind and human happiness. War is destruction; that is its end and aim. It is said to take 1,200,000 dollars to maintain the broadsides of the Queen Elizabeth in the Dardanelles for one single day. What a terrible thing to contemplate when we recollect that this all means the further destruction of human life, human fibre, human energy. But you say to me, " We must have wars." Well, it has been so in the past, it is so now, it may be so for a further time in the future, but I cannot read history without coming to the conclusion, at this standpoint of time in the twentieth century, which I believe you will all admit, that the world in the last one hundred years--I go back no further--has made immense strides forward to that final period towards which it is struggling, when differences between nations will be settled as differences happily are now settled between men and corporations. This war which is going on now was not prevented, was perhaps not preventible, but how many wars have been prevented within the last fifty years because of this added new spirit of the world, which protests against war as the means of settlement for all disputes which arise between nations? So I am not without hope, and I would not do my work in the world as well as I may be able to do it, nor would you, unless we carried with us a supporting optimism that though we ourselves may not see it, yet the human race is gradually climbing upward and forward to that time when international tribunals will settle disputes between nations as the tribunals of a country settle disputes between the individuals of that country.

In all production it is the purpose which hallows the activity. If the purpose is good, if the spirit is right, the activity is hallowed and spiritualised thereby. If the purpose is evil and wrong, all the activities which contribute to the completion and carrying out of the purpose are waste, and worse than waste, because they end in destruction.

No war in the history of the universe has had such a tremendous effect upon commerce as the present war. That is not due simply to the fact that this war has drawn into active belligerency the greatest nations of the world, combining more population, more wealth, more industrial activity, and more trade values than were affected by any war of the past. This is one element in it, but the other factor in it is that never in the history of the world has commerce been so world wide, and consequently so intensely sensitive to the effects of war. When this war broke out the wheels of commerce immediately stopped. The man who listened intently could have heard the sudden halt, and felt that the world, so far as commerce was concerned, stood still for a time. The mechanism of commerce was absolutely paralysed in all its parts. Wool became unsaleable in Australia, cotton in the United States, sugar for export was a drug on the market in Germany and in Austria, wheat had to be interned in warehouses in Russia, dyes and chemicals were sought for and could not be found; and so, all through the range of commerce, dislocation, disorganisation, destruction ensued unparalleled in the world's history.

Now Germany, as a participant in that world commerce, has much to lose, and the rest of the world has something to gain, on account of this war. First, what is Germany's present loss, and what is she likely to lose? Germany has developed to a fine art the practice of peaceful penetration of the neighbouring countries. Have you read Dr. Sarolea's book on Belgium? If you have not, it is well for you to read it. There is one chapter in it which brings out this idea. For years previous to the war, Belgium was gradually coming to be a suburb of Germany, through the influence of this fine art of peaceful penetration. Her watering-places and her marts of commerce were filled with German tourists, German financiers, German business houses, German agencies, German dwellers and sympathisers, who were always pressing German claims, and forwarding German interests, sentimentally and otherwise, until Belgium was in a fair way, as were Holland and Denmark and the Scandinavian countries, perhaps in lesser degree, of being so brought under the dominance of Germany as to run the risk of ultimately becoming little more than an adjunct to Germany, first commercially and socially, and later politically. Not only was that so with the near-by smaller nations, but in her trade system, in her tariffs, in every influence that could be brought to bear to compel trade to her way, Germany was peacefully penetrating larger nations near and far. By all the arts of tariff and treaty and diplomacy she pursued her purpose, and forced her trade upon Austria and Russia. In the same way, Servia was compelled for decades to pay business toll to Austria. I was reading the other day a statement made by one of the ministers of the Australian Commonwealth, in which he disclosed the most elaborate combination made by German financiers and capitalists to capture and control the metal interests of the Commonwealth of Australia. So in Africa, in China, in South America, everywhere by settlement and subsidy and concession and spheres of influence, through this fine art of peaceful penetration German interests were planted and extended. The war has broken that off absolutely. Now that the yoke has been lifted, will these neighbouring countries ever put their necks under it again? When the war is over and peace is established, after having destroyed their homes and fired their cities, after having committed nameless atrocities against the Belgian people, assassinated and murdered the Belgian nation, with what face and with what chance of success could German merchants ever again approach Belgium, and attempt to forward German interests and increase German trade?

That yoke has been thrown off-a yoke that was long borne, but that will never be borne again. Belgian trade will seek other channels. Germans and German trade will be suspect. So in other adjoining countries, and in the allied and neutral countries. That is one great advantage which Germany enjoyed which by this war she has forfeited and has forfeited for ever. She has lost more. This war has entailed a vast burden upon Germany-the tremendous burden of a most costly war in material and human assets destroyed, in the industrial and economic accumulations of centuries gradually and irretrievably swept away in the wild and destructive whirlpool of war. Her fleet has been able to hide behind the fortress of Heligoland and the Kiel Canal, and save a portion of itself, but her vast commerce has been swept from the world's marts, and her immense mercantile marine has vanished from the world's waters. Her river approaches and seaports, upon which she depended so largely for needed raw materials for her industries, and for exit for her manufactured goods to the markets of the world, have from the first been greatly obstructed, and today are pretty nearly absolutely blocked. That spells immense loss to Germany.

She has taken her most virile and active men from productive activities and is rapidly using them up in the waste of war. She has not only robbed herself of that active virility of profitable production, but she has imposed upon herself for generations the tremendous burden of maintaining the maimed and human products of that war, and all the dreadful train of deteriorating consequences which follow. Then comes the further incalculable burden of slaving and rebuilding the multitudinary activities and industries destroyed by war. Her factories have, in many cases, been closed, in most cases depleted, and her industrial forces scattered, disorganised, and much of it will be entirely dissipated before this war is over. But there is more. After the war the doctors' bills remain to be paid, and these will be presented not by her own doctors, but rather by those of the allied belligerents. Germany must pay to the uttermost possible farthing for the ruin she has wrought, for the wanton destruction she has caused, and the frightful inhumanity she has practiced--a sum total which is almost incalculable in arithmetical figures, and which day by day and hour by hour she is loading up for inexorable payment by the German people, which will remain incumbent upon them, first, asking for its interest, and later for its capital, payment for which cannot be evaded. Put all these things together, and we can reach a fair conclusion as to how greatly Germany in this mad war has depleted her home base of future operations, and crippled her possibilities as a competitor in the future. There is one other consideration stronger than all: Beaten in war after a contest begun without reason, pursued with an expression of heart hate unexampled in the history of the world, accompanied with atrocities which cannot now even be enumerated, but which will never be forgotten, can it be supposed that when peace is at last made Germany will be invited to the banquet table of the Allies as an honoured guest to whom generous treatment is due? She may pick up what crumbs she can as they fall from the table, but as an honoured guest not for generations to come can she be admitted to full market privileges, and allowed to replenish her thinned blood by drawing sustenance from the work and activity of the allied nations in commerce and in trade. She has richly earned and should undoubtedly be allowed to experience the salutary discipline of commercial ostracism by the nations she has sought to destroy. In addition to all there is the force of outraged moral sentiment which Germany has stored up against her future. Her own ally, Italy, ashamed of the alleged causes assigned for the war, refused to fight by her side, and thus furnished one of the strongest arguments against the conduct of Germany and Austria. Counting largely on Turkish support, she made great sacrifices to draw the Ottomans to her side, counting on wide and far-reaching reaction in the Mohammedan world. Turkey has proved but a limp support upon which to lean, and when within the next few weeks the Dardanelles shall have been cleared of their mines, and the adjoining coasts of their forts and guns, and Constantinople lies at the mercy-and it will be a tempered mercy-of the allied forces, Turkish influence shall have passed away from Europe, and Germany will have reaped no advantage, moral or otherwise, and her long-projected progress to the East will have proved but a dream. The one strong moral influence which weighs against Germany, and which will be counted against her for generations to come, is her treatment of the small independent nation of Belgium. Every day in the wilds of Africa, in the midst of India, in the heart of China, in every well-populated centre of the world, the story of Belgium's sufferings and heroism is being told, and films are being shown which portray her injuries, and hearts are stirred with sympathy, and tears drop from the eyes of all races and nations, cultured and uncultured, all the world over, and the question in the heart is, Why such barbarity, why such atrocity, and who has wrought this great wrong? To every mind there comes but one answer-Germany!

A man cannot go far in a community if the moral sentiment of the community is against him. A nation cannot go far in the great international race if the feelings engendered by such triumphs of atrocity as that are widespread, and are amongst the deepest and strongest held in the human heart. The world today condemns Germany. The world today remembers Belgium, weeps for her and works to assuage her sufferings. The world for generations to come will not forget that it was Germany that brought all these terrible consequences upon a peaceful, unobtrusive, unaggressive, loyal people, dwelling beside the borders of their country, under the plighted guardianship of stipulations signed by the very power that afterwards ravaged her territory and drove her people into exile. After this war there is a Belgian nation of 7,000,000 of people to be repatriated and rebuilt; there is Poland, about which we hear so much less, but which has suffered almost as grievously, with the added pathos that in the struggle in Poland the Pole has been compelled to meet his brother Pole in the death conflict. Poland then has to be reconstructed; and infinite damage has to be made good in various other quarters of the belligerent field. All the resources of the world will be called upon to make that reconstruction. And now if it be at all allowable to mingle commercial considerations with this great theme that we have been discussing, Canada's opportunity is a fair one. She need not avoid it, she has a right to face it, and to take her part not simply for commercial reasons, but on the broad basis of contributing to the reconstruction and upbuilding of the ravaged places. She has a right to consider her resources, to organise her forces, and to systematise them so that her products and her industries may find their way to these desolated spots with credit and profit to herself and also as contributing to the great work of world-building.

A vote of thanks to the speaker was moved by Mr. Woods, President of the Toronto Board of Trade, and seconded by Hon. Dr. Jamieson.

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The War and Commerce


A few remarks with reference to the war which is at present raging, and commerce as it is affected by the war. Disclaiming the idea that war is a promoter of commerce. War as an enemy of commerce. Denying the German contention that they have been forced into this war because of Britain's jealousy of German progress in industry and commerce, and that the war was forced upon them by Great Britain for the purpose of destroying Germany's trade. Not disposed after the experience of the last eight months to put very much reliance on the statements of the German government as excuses for their action in the war, or as causes of the war itself. Looking at the last 35 years and finding that Great Britain has dealt in a particularly generous way with the commercial development of Germany. Britain as a "good sport"; Germany as a "bad sport." Commerce acting quietly, unlike war upon which the attention of the world is riveted. Commerce reading more like a romance. Commerce depending absolutely upon production, in turn stimulated by demand. What commerce is. The modern nature of commerce. Transportation as the mechanism of modern commerce. The mechanism of transport today as opposed to 3-4,000 years ago. Broadly speaking, the two kinds of production, beneficent production being illustrated by farmers' work, the other called by the speaker a maleficent production. An explication. The destructive nature of war. Hoping that we are working towards a time of no war. "In all production it is the purpose which hallows the activity." The tremendous effect upon commerce that the present war is having, and to what that is due. The sensitivity of commerce to the effects of war. The wheels of commerce stopping when this war broke out. The mechanism of commerce absolutely paralysed in all its parts, with illustrative examples. Germany's present loss, and what she is likely to lose. Germany's treatment of Belgium and the far-reaching consequences of such treatment. A nation's inability to go far in the great international race if the feelings engendered by such triumphs of atrocity as that are widespread, and are amongst the deepest and strongest held in the human heart. The resources of the world that will be called upon for reconstruction. Canada's opportunity as a fair one. Canada's right to consider her resources, to organise her forces, and to systematise them so that her products and her industries may find their way to these desolated spots with credit and profit to herself and also as contributing to the great work of world-building.