led civilized Powers could
share in the operation, and the absurdity of the position was increased
by the fact that some at least of the Powers which lent the money would
have had to borrow it somewhere before they could do so.

This freedom with which England has furnished financial resources to the
rest of the world is sometimes called in question as having had, or
being likely to have, bad effects upon the activity of production at
home. It is quite clear that the progress of international commerce and
the division of labour among nations by which commodities of all kinds
have been very greatly cheapened could not have been carried out if
England and other comparatively far developed countries had not supplied
the necessary capital for the development of the relatively backward
parts of the earth. If English money had not gone into building railways
in America, Canada, Argentina, Australia, and all over the world, and
supplying capital to the farmers and others who opened up these
countries, food could not have been nearly as cheap as it is or as it
was before the war, and clothes and other necessaries of life would have
been at a very different price. In fact, it may be said that if England
had not acted as she has, as the world's financier, the development of
the world's trade to anything like its present scale would have been
altogether impossible. If we could feel sure that the distribution of
the world's production had been as satisfactory as the wonderful
increase in its output, there would be no question that all classes in
England had been very greatly benefited by its financial activities
abroad. As it is, it is sometimes argued that English capital going
abroad stimulates production in other countries and increases the demand
for labour there, but that the demand for labour in England and its
reward might have been on a higher scale if English capital had been
kept at home. This is a question which is, happily perhaps, outside my
province at present, but it is one which demands serious attention. This
much can be said, that the years in which English capital has gone
abroad with the greatest rapidity have also been those in which our
export trade has been most active, and it is obvious that this must be
so, because when England exports capital it does so in the form of
lending money either to a foreign Government or to a foreign
municipality, or to some company, English or foreign, which is
conducting some