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future of Europe. The miscellaneous Powers have the option of becoming temporary members, like shadows that perpetually come and go, but it is the Big Five that are to remain in constant discussion and co-operation with vigilant eyes directed at the whole march of events. This means that Poland, a State which is vitally concerned in all these questions of Germany's eastern frontier, is to remain outside the permanent ranks of the members of the Council, or at most she may have the option of a passing possession of the elective membership. For, as has again and again become potent in the course of this article, it is Poland that has become the storm centre of all these manufactured panics, and it is because of her discovered candidature that certain ancient calumnies have been revived by those who might have known better in order to give plausibility to their rejection of her claims.

Taking, then, Poland, as we must, as the State round which the storm of controversy is loudest, is it not advisable to ask ourselves, not rashly but calmly, what course is best in the ultimate interest of the peace of Europe? Will the Council function most effectively when any difficult question arises at the most critical point when Poland is inside or outside the permanent ranks of the Council? The answer, when the question is thus resolutely pressed home, can hardly be doubted for a moment. It is true that there is a provision whereby a country, whose interests have become the subject of discussion, can be temporarily added to the Council, and it has already been admitted that some who oppose Poland as a permanent member are ready to concede her claims to a temporary place. But would either of these courses be the best or most effective way of securing that an ultimate settlement would be reached which would assuage the feelings of bitterness which constitute a menace to the peace of Europe? Could an attenuated Council formulate a second Locarno Pact which all the combatants would sign? Surely it is the experience of everyone who has to conduct difficult and delicate negotiations that, in any process of conciliation, it is the first stages that really count. The very first course to take with those who have a grievance is to keep them isolated apart so that they may vigilantly cherish and keep warm their wrath. In that way, certainly, the real risk of failure lies; but if the two are patiently encouraged in contact and acquire the habit of mutually discussing their difficult problems, they will ultimately bring to their consideration all that moderation and mutual

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respect which they have acquired from an experience of previous and, perhaps, less poignant controversies. Locarno it was at the previous talks, and not the formal conference, that the battle was most frequently won, and why shall not the same rule apply to the present controversy? At any rate there is nothing Machiavellian or sinister about such an idea, and our critics, if they would only rid their minds of baseless presuppositions, would see that it is but the quintessential extract of the most approved experience in all similar difficulties.

Again, let us similarly and with calm consideration regard the position of France with an enlarged permanent membership of the Council. Are some of the unfortunate suggestions which have become current in this country as to the ultimate purpose of France capable of application to the ensuing state of things? It is alleged that, in the present Council, she makes it her mission to support the claims of Poland. Even granted that this is really the case in the present Council, will it be likely to be more or less probable if Poland herself joins the ranks of the permanent members? The answer can hardly be doubted. If Poland were there in the Council to put up her own point of view, all obligation on the part of France to consider herself as the inevitable champion of Poland would immediately disappear. It would be possible, on the other hand, for France to join our own country in what we pride ourselves is our own country's special prerogative-that of surveying events impartially from a more detached point of view, and contributing the element which is really needed to bring assuagement to age-long controversies.

It is important to stress this point, for much the most mischievous of the suggestions which have been mooted in the British Press at this particular crisis is that there is a plot being hatched in France or Poland against the settlement of Locarno. How, except in the brains of irresponsible individuals, could such a suggestion have been conceived? There is no reason to doubt the French loyalty to Locarno, and as for Poland, its present Prime Minister, Count Skrzyński, has repeatedly praised it in the warmest terms. And he was not content with words. Immediately after the Pact was formally signed, he stopped the expulsion from Poland of those who, under a convention and of their own accord, had chosen German nationality. In the negotiations for the liquidation of German property and for the conclusion of a commercial treaty with Germany

he has shown the same patient and conciliatory spirit. Speaking at Williamstown, Massachusetts, in July 1925, he said that "the League of Nations has provided a much needed centre where statesmen meet to take counsel and where good understanding has often been achieved. . . Our public opinion wants to see the fullest possible development of the League." There can be no manner of doubt that this is the spirit, and not that imputed to her by unfriendly critics, in which Poland would accept her mandate as a permanent member of the League's Council.

J. H. HARLEY

BRITISH TRADE AND THE EMPIRE

DURING the last two or three years the leaders of industry and the City of London have held differing views on the prospects of British industry in relation to the export trade.

The industrialists, who are in close touch with all the problems of manufacturing, have inclined to take a pessimistic view of the present and future outlook. The falling off of export trade in coal, in iron and steel, and the acute depression of shipbuilding naturally appear to those directly concerned to be of the gravest moment.

While those who take the typical City view acknowledge the present serious position, they point out that in spite of the tremendous handicaps that the war placed upon Great Britain, the national finances have stood the strain. They maintain that when price-levels adjust themselves, Great Britain will again enjoy her old ascendency in the markets of the world.

The influences affecting trade are so many and so diverse that few can attempt to decide whether industry or finance more justly appraises the situation. Let us instead examine the growth of the competitive power of foreign nations and compare their progress with that of Great Britain, and then turn to examine in which markets of the world Great Britain continues to hold her own.

For information about the British share of world trade there exists the exhaustive survey of British overseas trade recently compiled by the Balfour Committee, and it is now possible in a number of cases to augment the information contained in that report by the published summaries of the trade in 1924 of certain important countries.

Definite changes may be observed in the relative distribution of trade since the war. For instance, Great Britain's share of the imports of Holland, Belgium, Germany, Denmark, and Russia has increased in 1924 over the 1913 level. This is no doubt due to the temporary crippling of German industrial strength and the consequent partial shifting of the demand for manufactured goods from German to British centres of manufacturing activity. While the British share of Russian imports declined from 33.9 per cent. in 1870 to 12.1 per cent. in 1912, in 1923 Britain's share had risen to 20 per cent. At the same time it must be noted that the post-war value of trade with Russia was

less than a third of the pre-war value. It is the general opinion that when Germany regains her industrial strength, Britain will lose the temporary advantage she has held in those markets. Figures for 1924 already show a falling share of imports.

The only other important market in which the British share of imports in 1923 was greater than in 1913 is Brazil. Here, however, the latest statistics show that the United States of America has now become Brazil's chief supplier.

In most of the foreign markets the British share of trade in 1923 or 1924 is lower than in 1913. In the case of Italy, a marked decline in the proportion of British manufactured goods and coal is noticeable. The United States has, as a result of a great development of manufacturing activity, tended to import a greater proportion of raw materials than before the war, and the decline in the share of Great Britain in her imports from 16.3 per cent. in 1913 to 10.1 per cent. in 1924 is therefore not surprising. A great increase of competition in Argentine markets on the part especially of the United States of America and Italy has been felt by the British exporter, and Great Britain's share of imports has declined from 31 per cent. in 1913 to 23.8 per cent. in 1923. Germany also has been able largely to regain her pre-war position as a supplier to the Argentine. Though China's troubled conditions may account for the actual loss of import trade done by Great Britain, yet the loss relative to other countries cannot be so explained. In 1913 Great Britain was much the largest supplier of cotton piece goods to China; in 1923 Japan had taken her place. Serious as has been the decrease of British exports to China, the loss of trade with Japan is equally noticeable, though in this case the increasing manufacturing output of Japan may explain in part Great Britain's falling share of the Japanese import trade.

It is almost a truism to say that Great Britain is more dependent on the maintenance of her export trade than any other nation, yet an examination of the export trade of other countries shows that they are building up a position of great strength in the world's markets by means of their manufactured exports.

The latest trade figures show that Great Britain in 1925 had an apparent "adverse" balance of trade of £385 millions in comparison to an apparent "adverse" balance of £324 millions in 1924 and £194 millions in 1923.

The Board of Trade now estimates that, taking into

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