contradict each other.
Of course the war is being largely paid for immediately out of the
accumulated private wealth of the past. We are buying off the "hold-up"
of the private owner upon the material and resources we need, and paying
in paper money and war loans. This is not in itself an impoverishment of
the community. The wealth of individuals is not the wealth of nations;
the two things may easily be contradictory when the rich man's wealth
consists of land or natural resources or franchises or privileges the
use of which he reluctantly yields for high prices. The conversion of
held-up land and material into workable and actively used material in
exchange for national debt may be indeed a positive increase in the
wealth of the community. And what is happening in all the belligerent
countries is the taking over of more and more of the realities of wealth
from private hands and, in exchange, the contracting of great masses of
debt to private people. The nett tendency is towards the disappearance
of a reality holding class and the destruction of realities in warfare,
and the appearance of a vast _rentier_ class in its place. At the end
of the war much material will be destroyed for evermore, transit, food
production and industry will be everywhere enormously socialised, and
the country will be liable to pay every year in interest, a sum of money
exceeding the entire national expenditure before the war. From the point
of view of the state, and disregarding material and moral damages, that
annual interest is the annual instalment of the price to be paid for the
war.

Now the interesting question arises whether these great belligerent
states may go bankrupt, and if so to what extent. States may go bankrupt
to the private creditor without repudiating their debts or seeming to
pay less to him. They can go bankrupt either by a depreciation of their
currency or--without touching the gold standard--through a rise in
prices. In the end both these things work out to the same end; the
creditor gets so many loaves or pairs of boots or workman's hours of
labour for his pound _less_ than he would have got under the previous
conditions. One may imagine this process of price (and of course wages)
increase going on to a limitless extent. Many people are inclined to
look to such an increase in prices as a certain outcome of the war, and
just so far as it goes, just so far will the burthen of the _rentier_
class, their call, tat is, for