I
Since Pacifism and semi-seditious agitation have become both unpopular
and risky, the propagandists of disunion have been at pains in
endeavouring to insidiously affect public sentiment by spreading the
fiction that America's entrance into the war was fomented by "big
business" from selfish reasons and for the purpose of gain. In the
same line of thought and purpose they proclaim that this is "a rich
man's war and a poor man's fight," and that wealth is being taxed here
with undue leniency as compared to the burden laid upon it in other
countries.
These assertions are in flat contradiction to the facts.
Nothing is plainer than that business and business men had everything
to gain by preserving the conditions which existed during the two and
a half years prior to April, 1917, under which many of them made very
large profits by furnishing supplies, provisions and financial aid to
the Allied nations, taxes were light and this country was rapidly
becoming the great economic reservoir of the world.
Nothing is plainer than that any sane business man in this country
must have foreseen that if America entered the war these profits would
be immensely reduced, and some of them cut off entirely, because our
Government would step in and take charge; that it would cut prices
right and left, as in fact it has done; that enormous burdens of
taxation would have to be imposed, the bulk of which would naturally
be borne by the well-to-do; in short, that the unprecedented golden
flow into the coffers of business was bound to stop with our joining
the war; or, at any rate, to be much diminished.
The best indication of the state of feeling of the financial community
is usually the New York Stock Exchange. Well, every time a ship with
Americans on board was sunk by a German submarine in the period
preceding our entrance into the war, the stock market shivered and
prices declined.
When, a little over a year ago, Secretary Lansing declared that we
were "on the verge of war," a tremendous smash in prices took place on
the Stock Exchange. That does not look, does it, as if rich men were
particularly eager to bring on war or cheered by the prospect of
having war?
But, it is said, the big financiers of New York were afraid that the
money loaned by them to the Allied nations might be lost if these
nations were defeated, and therefore they manoeuvred to get America
into the war in order to save their investments. A moment's reflection
will show the utter absurdity of that charge.
American bankers have loaned to the Allied nations--almost entirely to
the two strongest and wealthiest among them, France and
England--about two billions of dollars since the war started in 1914.
These two billions of dollars of Allied bonds are not held, however,
in the coffers of Eastern bankers, but have been distributed
throughout the country and are being owned by thousands of banks and
other corporations and individuals.
Moreover, they form an insignificant portion of the total debts of the
Allied nations; they are offset a hundredfold by their total assets.
Even if those nations were to have lost the war it is utterly
inconceivable that they would ever have defaulted upon that particular
portion of their debt, because, being their _foreign_ debt, it has a
special standing and intrinsic security.
It is upon the punctual payment of its foreign obligations that a
nation's credit in the markets of the world largely depends, and
the maintenance of their world credit was and is absolutely vital
to England and France. Furthermore, the greater portion of these
obligations is secured by the deposit of collateral in the shape
of American railroad and other bonds, etc., which are more than
sufficient in value to cover the debt.
But let us assume for argument's sake that the Allies had been
defeated and had defaulted, for the time being, upon these foreign
debts; let us assume that the entire amount of Allied bonds placed in
America had been held by rich men in New York and the East instead of
being distributed, as it is, throughout the country. Why, is it not
perfectly manifest that a single year's American war taxation and
reduction of profits would take out of the pockets of such assumed
holders a vastly greater sum than any possible loss they could have
suffered by a default on their Allied bonds, not to mention the heavy
taxation which is bound to follow the war for years to come and the
shrinkage of fortunes through the decline of all American securities
in consequence of our entrance into the war?
Is it not perfectly manifest to the meanest understanding that any
business man fomenting our entrance into the war for the purpose of
gain must have been entirely bereft of his senses and would have been
a fit subject for the appointment of a guardian to take care of
himself and his affairs?