her half be able to carry on? Foreign
orders they cannot possibly execute, because there can be no certainty
of the delivery of the goods; and even if they could, the price at which
they could deliver them with a profit would be much higher than it is in
peace. For with a diminished supply the price of raw material must go
up, the cost of marine insurance must be added, together with the extra
wages necessary to enable the workmen to live with food at an enhanced
price.

Thus the effect of the greater difficulty of sea communication must be
to destroy the margin of profit which enables the British capitalist to
carry on his works, while the effect of all these causes taken together
on the credit system upon which our whole domestic economy reposes will
perhaps be understood by business men. Even if this state of things
should last only a few months, it certainly involves the transfer to
neutrals of all trade that is by possibility transferable. Foreign
countries will give their orders for cotton, woollen, and iron goods to
the United States, France, Switzerland, and Austro-Hungary, and at the
conclusion of peace the British firms that before supplied them, if they
have not in the meantime become bankrupt, will find that their customers
have formed new connections.

The shrinkage of credit would bring a multitude of commercial failures;
the diminution of trade and the cessation of manufactures a great many
more. The unemployed would be counted by the million, and would have to
be kept at the public expense or starve.

If in the midst of these misfortunes, caused by the mere fact of war,
should come the news of defeat at sea, still more serious consequences
must follow. After defeat at sea all regular and secure communication
between Great Britain, her Colonies, and India comes to an end. With the
terrible blow to Britain's reputation which defeat at sea must bring,
what will be the position of the 100,000 British in India who for a
century have governed a population of nearly 300,000,000? What can the
Colonies do to help Great Britain under such conditions? For the command
of the sea nothing, and even if each of them had a first-rate army, what
would be the use of those armies to this country in her hour of need?
They cannot be brought to Europe unless the British navy commands the
sea.

These are some of the material consequences of defeat. But what of its
spiritual consequences? We have brought up our children in t