irit owing to the short-sighted financial measures which have
been taken by our rulers.

Thus, when we consider how our war finance might have been improved,
we imply all along that the improvements suggested should have been
begun when the war was in its early stages, and when public opinion
was still ready to do its duty in finance. The conclusion at which we
arrived a month ago was that by taxation rather than by borrowing and
inflation much more satisfactory results could have been got out of
the country. If, instead of manufacturing currency for the prosecution
of the war, the Government had taken money from the citizens either by
taxation or by loans raised exclusively out of real savings, the rise
in prices which has made the war so terribly costly, and has raised so
great a danger through the unrest and dissatisfaction of the working
classes, might have been to a great extent avoided, and the higher the
rate of taxation had been, and the less the amount provided by loans,
the less would have been the seriousness of the problem that now
awaits us when the war is over and we have to face the question of the
redemption of the debt.

In this matter of taxation we have certainly done much more than
any of the countries who are fighting either with us or against us.
Germany set the example at the beginning of the war of raising no
money at all by taxation, puffed up with the vain belief that the cost
of the war, and a good deal more, was going to be handed over to her
in the shape of indemnities by her vanquished enemies. This terrible
miscalculation on her part led her to set a very bad example to the
warring Powers, and when protests are made in this country concerning
the low proportion of the war's costs that is being met out of
taxation it is easy for the official apologist to answer, "See how
much more we are doing than Germany." It is easy, but it is not a good
answer. Germany had no financial prestige to maintain; the money that
Germany is raising for financing the war is raised almost entirely
at home, and she rejoices in a population so entirely tame under a
dominant caste that it would very likely be quite easy for her, when,
the war is over, to cancel a large part of the debt by some process of
financial jugglery, and to induce her tame and deluded creditors to
believe that they have been quite handsomely treated.

Here, however, in England, we have a financial prestige which is based
upon financial lea