hope and believe that they will be
found to have been nightmares, evolved by depressed and prejudiced
imaginations. War destroys capital when and where actual destruction of
property takes place, as now in Belgium, Northern France, and other
scenes of actual warfare, and on the sea, where a large number of
ships, though small in relation to the total tale of the merchant navies
of the world, have been sunk and destroyed. Destruction in this sense
has only been wrought, so far, in limited areas. In so far as
agricultural land has been wasted, kindly nature, aided by industry and
science, will soon restore its productive power. In so far as factories,
railways, houses and ships have been shattered, man's power to make,
increased to a marvellous extent by modern mechanical skill, will repair
the damage with an ease and rapidity such as no previous age has
witnessed.

In another sense it may be argued that war destroys capital in that it
prevents its being accumulated, but this is a distortion of the meaning
of the word destroy. If it had not been for the war, we in England
should have been saving our usual three to four hundred millions a year
and putting the money to productive uses, in so far as we did not lend
it to spendthrift nations or throw it away on unprofitable ventures. If
we had invested it well, it would have made us and the rest of the world
richer. Instead of doing so we are spending our savings on war and
consequently we are not growing richer. But when the war is over our
material productive power will be as great as ever, except for the small
number of our ships that have been sunk or the small amount of damage
done to us by enemy aircraft. Our railways and factories may be somewhat
behindhand in upkeep, but that will soon be made good, and against that
item on the debit side, we may set the great new organization for
munition works, part of which, we may hope, will be available for
peaceful production when the time for peace is ripe.

It is a complete mistake to suppose that war can be carried on out of
accumulated capital, which is thereby destroyed. All the things and
services needed for war have to be produced as the war goes on. The
warring nations start with a stock of ships and guns and military and
naval stores, but the wastage of them can only be made good by the
production of new stuff and new clothes and food for the soldiers and
new services rendered as the war goes on. This new production m