Chapter XXII:
Objectives in Foreign Relations

WE MAY roughly divide the objectives of our foreign policy into those classifiable under the head of national defense, economic security, and special policies. As for the objectives of national defense, it seems clear that in order to maintain our position as a great nation we should maintain naval parity with the greatest power, a professional army of at least four hundred thousand men fully equipped, and universal compulsory military service. It may be asked why we need such a large armed establishment if we are not going to be the aggressor and if, with a much smaller establishment, we could probably raise enough forces in time to meet any attack and secure our defense. The answer is that if we have an inferior military establishment, we are more than likely to be challenged, inasmuch as we will inevitably insist on having a lot to say in the foreign field.

We cannot avoid war by being unprepared for it, as our experience in the late War demonstrates. And we cannot determine for ourselves the scale of armaments which properly corresponds to our size and pretensions. The scale of armaments which properly corresponds to our size and pretensions must, in the nature of things, be dictated to us by the rest of the nations. If they maintain armaments on a certain scale, we must observe, accordingly, proportions on that scale corresponding to our size and stakes. To have the interests of a first rate world power, to insist on interposing our word or will as such, and to maintain an armed establishment disproportionately small, is merely to tempt daring and desperate powers to risk an encounter with us. As for the costs of national defense, it need only be said that men are better off in the army than in the bread line, and the country is better off to have the idle producing the instruments of self-defense than to have them idle. National defense is one way of producing and consuming wealth. Unemployment is not a source of income but a true and tragic waste.

Every one, liberal, fascist and communist, including all the professional and sincere pacifists, wants peace, provided it can be had on his terms. In this respect it is difficult to see any difference between the so-called pacifists and the so-called militarists. No one, certainly not any one of the numerous types of pacifists, is willing to have peace on any terms whatsoever which the other fellow may dictate. In other words, no one puts peace first in his list of objectives. There are no believers in peace at any price. Those who talk most about their love of peace and other men’s love of war and who ordinarily oppose most violently any adequate military preparedness for their own country will be the first and most energetic advocates of getting their own country into a war for peace every time an international conflict breaks out anywhere in the world.

Fascism has been denounced by the liberals, pacifists and socialists as a war breeder, yet, at the time this book went to press, it was the latter who, along with the international banking and pro-English interests and sympathizers everywhere, were on record in the Italian-Ethiopian situation as supporting sanctions which could only mean a world war. On the other hand, the organized fascists of England, under Sir Oswald Moseley, and of France, under Colonel de La Rocque, were constantly making public demonstrations in opposition to policies which the British Government was trying to have carried out by the League, policies which, as the responsible British statesmen well knew, could only mean a world war.

The fascist, being an enlightened patriot of his own nation, is ready to fight for its defense and supposed best interests but never for abstractions like peace and international justice, terms which, as a practical matter, mean the side in a conflict taken by the user of these terms. The fascist sees that the defense and best interests of his own land do not require it to become involved in every war that occurs. The internationalist, on the other hand, must try to draw his country into every war that breaks out, for he is committed always to fight for peace and justice, as something quite apart from the selfish interest of his own country, and every war necessarily presents a breach of the peace as well as an issue of justice. The real issue between the fascist and liberal view as to foreign policy is not one of Shall we uphold peace or permit wars? for no League or similar agency has ever prevented or can ever prevent war. The Italian-Ethiopian and the Sino-Japanese episodes of the past two years have added to the long list of historical proofs of the impossibility of international action, through the League or without a league, preventing war or terminating war except as wars have always been terminated, namely either by fighting it out or by compromise diplomatically, not judicially, arrived at, according to the existing balance of power or force factors, not according to any normative verbalisms or principles of law or justice set forth in League Covenants, treaties or other masterpieces of legal draftsmanship. The real issue, so far as internationalism or Anglo-League-ism is concerned, is whether every challenge to the existing status quo which England may find dangerous to her imperial interests and consequently may wish to have pronounced a crime and an unwarranted aggression shall be turned into a world war, by reason of a British monopoly of righteousness and a British supremacy in finance and propaganda used to line up most of the nations of the world in opposition to the challengers and in defense of what England desires.

The internationalists, of course, try to argue that lining up the whole world into two camps of the angels versus the war making devil or devils will prevent wars from occurring or quickly end them if they do break out. The argument, however, rests on nothing but wishful thinking. It will, of course, happen in practically every war or clash of national interests that there will be a majority and a minority both as to numbers of nations taking sides and as to their combined resources. But it will not happen that the majority on the side of England and the angels will always be so overwhelming as to prevent a resort to arms. If the coalition on the side of the angels does not prevent the war starting, it is a travesty on words to call it — a coalition to make war — a peace-making measure. It will not always happen that the majority will side with England and the angels. And it may even happen that a majority with England and the angels will some day get licked by a minority fighting against peace and justice as defined by England and the League. Then there is strong reason to suppose that some nations will remain on the fence in a holy war between justice and injustice or England and the Devil, thus complicating military calculations or any program of joint coercion against the Devil. The internationalists, most of whom are subsidized spokesmen of the bankers and their peace foundations, colleges, press and other cultural institutions, have a profound and understandable reverence for bankers, international finance and business men generally. This naive awe of trade and finance leads these internationalists and theorists to attribute to finance and trade a power to exercise deterrent pressure on political leaders which money changers and traders have never been able to exercise against strong men in the saddle. Alexander, Julius Caesar or even as recent a conqueror as Napoleon were never subject to restraint from making war by any possible action of money-lenders and traders, not any more than Hitler, Mussolini, Stalin or Araki are today. Money-lenders and tradesmen can support governments under which they live in making war on a Caesar or a Napoleon or a Mussolini, but they are effective only as auxiliaries of the men behind the guns in actual war, not as forces to prevent a war. The money lenders and tradesmen of the country of a political leader who wants to make war, of course, will always have to do as they are told quite as much as conscripted soldiers.

Economic sanctions without waging armed warfare are always certain to prove a farce. Economic forces can be mobilized effectively only to help make war, never to prevent it. The reasons are obvious on analysis of the factors which determine war making. It is hard enough ordinarily to hold together for any length of time in an effective measure of loyal and efficient cooperation any large coalition of nations allied in making a war. This feat was achieved by the Allies in the late World War only by virtue of the ten billion dollars of goods and services which the American people donated to subsidize the Allied effort. What holds a war making alliance together or what enforces a workable measure of solidarity, loyalty and efficient cooperation in a war enterprise is one thing: a strong and ever present sense of danger from a common foe. To expect a large number of allies to maintain such solidarity and cooperation in applications of economic pressure when no such paramount motivation operates to impose it is utterly naive and unrealistic. Every member of such a preposterous coalition of peacefully coercing nations would have unlimited opportunities and inducements to cheat with safety and advantage. And it would be technically impossible for the alliance, as a whole, to act as an inquiring policeman, a judging magistrate or a disciplining force. Nations and large groups of individuals can only be disciplined by emotional drives from within. Legal verbalisms which they may adopt as norms of conduct have validity only to the extent that the inner drives in the majority of persons uphold the enforcement of these norms. In war time there is a majority group will to self-defense and defeat of the enemy in arms. In sanctions time there could be no majority group will to uphold measures which would operate to national economic disadvantage and which would be indicated by no imperative of immediate safety. The notion that war, in the abstract, is a public enemy against which all nations can be permanently united is the purest poppycock. Those who preach this absurd notion most are the first to refute it by rushing to embrace this public enemy war as a means to the desired end of peace.

As this book goes to press, the League is being manipulated by England in an attempt to force the rest of the world into an alliance to protect and further what those in power in England mistakenly consider to be Britain’s best interests in the Mediterranean. Any one would be rash to predict exactly what would be the outcome of a war involving most of the nations of the earth at the start in a war against Italy. But it is safe to predict what would not result from any such British or League war. For one thing, it would not long remain a united enterprise. For another, it would not succeed in its alleged undertaking to lay the foundations of a lasting peace and scheme of justice. It would begin by making a small war large. How it would end, no one can say, except to guess that it would end in the triumph of communism or chaos.

No Englishman is to be blamed for wanting to fight Italy or any other country if he believes such a war in the best interests of England. Nor should he be censured for trying to secure as many allies as possible for his country in that war by the use of the most unscrupulous propaganda, the most absurd exploitation of moral issues or the most barefaced lies. All is fair in love and war. Likewise, no Italian should be blamed for wanting his country to follow the illustrious examples of conquest and territorial aggrandizement which have made the United States, Britain and France great and powerful. But any American or Frenchman who would have his countrymen duped into fighting another nation’s battle, be it that of Britain or Italy, when it is not the battle of his own country, should be deemed a poor patriot or a poor thinker or both.

It is absurd to argue that a battle against every aggressor nation is always the battle of all other nations, the argument now being advanced by Britain as the ruling principle of the

League. Such an argument is historically and rationally untenable. The nations of the world did not combine to avert, defeat or even mildly censure a ruthless and unjustified American aggression against and conquest of Mexico or similar British and French aggressions, conquests and annexations too numerous here to mention, yet the nations of the world, as a whole, have never felt or had reason to feel the fear that America, Britain or France would go on from one conquest to another until the entire world had been subjugated by one or the other of these great powers. As Mr. Frank Simonds has so aptly pointed out in the Italian-Ethiopian conflict, it is absurd for the winners at the national game of conquest, having themselves acquired by conquest about all they feel able or disposed to manage, if not more, suddenly to go righteous and try to enforce on the entire world for all time a code of morality, the first commandment of which Thou shalt not follow our examples.

Under the heading of national security, we must not only maintain adequate armed forces, but we must make sure of the exclusion of European powers from further extension of their influence in this hemisphere, as well as secure our control of the Panama Canal. To maintain our paramount strategic position on this hemisphere and prevent an extension of European influence, it is not necessary for us to repeat or continue the stupid and unnecessary adventures of Presidents Theodore Roosevelt, Taft, Wilson, and Coolidge, and Secretaries of State Root and Hughes, in dollar diplomacy, loans, military interventions, financial interventions, political meddling to insure fair elections, sound financial control, or protection, of American capital in the Caribbean republics. To keep Europe out of those republics is all we need aim at.

To do that, all we require is naval supremacy and appropriate bases in these areas. We do not need to insure good government, sound financial administration, or special protection for foreign capital, in the Caribbean republics in order to keep European governments out. We could not insure such ideal conditions there if we tried. We do not have them at home and certainly they do not prevail in most European countries today. Nor do we need to have any such ideal conditions in the Caribbean republics in order to make it possible for out citizens to exploit the resources and peoples of these republics. Nor ought we to attempt, through intervention in these republics, to afford American interests there a degree of security which business in the United States does not enjoy from gangsters, tornadoes, business depressions or high taxes.

The only interest in Latin America about which our government need be concerned is that of our security. That interest we can safeguard only, but easily, with an adequate navy. By disavowing the role of a purifier of Latin-American elections, finances, and police administration, and allowing our interests there to take their chances under local government, we can earn the friendship and goodwill of these countries for respecting their sovereignty, independence, and autonomy. At the same time, our fleet can dominate these countries as regards a European intervention, and our capitalists can dominate them economically as long as they choose to maintain extreme laissez-faire. Should they abandon laissez-faire and turn socialist, or extreme economic chauvinists, as Mexico has done and other republics are showing signs of doing, we should let them freely go their way as long as they make no move to invite European intervention. And if, as is most unlikely, they make such a move, we should check it by bringing to bear our diplomacy, backed by our potential armed might, against the European party to such possible intervention.

About twenty-five years ago, our statesmen, naive in diplomacy and world politics, conceived the small-town idea that the Caribbean nations had to be good to avoid European intervention and that, because of this moral imperative, we had to make them good with financial and military interventions. As any worldly wise person ought to know, world powers intervene when, where, and because, the intervening is good, and not when, where, and because, the intervenee is bad and might, on that account, be deemed to merit a foreign intervention. About everything bad that a nation could conceivably do to the detriment of foreign interests, the Russian Soviet Government has done. But no foreign intervention has been made, or even seriously contemplated, for the excellent reason that, in Russia, the intervening would not be so good.

On the other hand, in Morocco, Manchuria and Ethiopia, the intervening may be called good and easy — or in Haiti or Nicaragua, for that matter. What makes the intervening good is not weakness of their morals or financial probity, but the weakness of their power of armed resistance, and the absence of opposition by the great powers to an intervention. We no longer need to mention officially the Monroe Doctrine. We might even expressly renounce it by way of flattering our Latin-American neighbors. The size and efficiency of our fleet will say to Europe all that the Monroe Doctrine was ever meant to say. And a big fleet will say it with a delicacy which will not offend Latin America and with an explicitness which will not be misunderstood in Europe. The Monroe Doctrine, after all, was but a crude substitute for a big navy in the days when we could not afford a big navy. What made the substitute work in those days was the big British navy.

As for economic security, here again we find our imperatives largely dictated by foreign powers and not our own choosing. The world has in prospect an era of increasingly closed economies. Why this is true, why the counter arguments of classical economics and free trade are wholly irrelevant and are being disregarded by prevailing public policies, and why we cannot change this trend, could only be explained in another book the size of this one. But an explanation of the inevitability of this trend today seems about as superfluous as an explanation of the inevitability of old age. The thing for nations or elderly people to think about today is adjustment in the most satisfactory manner to inevitable changes.

Adjustment to the imperatives of increasingly closed economies the world over, fortunately, is easier for the United States than for any other nation, because our import necessities are fewer and our near-monopolies in exports like cotton, tobacco and certain manufactures, are more important than those of any other country. With our resources for domestic needs and for export, we can feel reasonably confident of always being able to sell abroad enough to pay for our necessary imports of commodities like coffee, tin, rubber, silk, jute and tropical fruits which we cannot economically produce ourselves. The making of these new adjustments will involve a series of barter arrangements and quota agreements, under which provisions will be made for the exchange of given quantities of American exports of specified commodities for a counter-value of given quantities of imports of specified commodities. Within the framework of such a system of agreements, or controlled exports and imports, private interests in this country will have scope for considerable competition and initiative. The governing principles will be procurement of necessary imports; provision for necessary exports to balance the international accounts; protection of domestic industry, that is to say, of the domestic wage scale and the domestic investment; the relative immunization of the national economy from external disturbances, especially those incidental to large wars; and the achievement of a diversified national production affording the maximum economic self-sufficiency obtainable without unreasonable economic costs and sacrifices.

The ruling liberal, laissez-faire principle for foreign trade, namely that of dumping in order to stimulate domestic production and increase the nation’s holdings of foreign investments, must, obviously, be discarded in a world of increasingly closed economies. Our present foreign investments, especially those in foreign securities or credits, must be counted as largely lost under the regime of closed economies, except in so far as counter-values of foreign-held investments in this country make it possible for American investors in foreign securities to collect foreign credits, or except in so far as Americans residing abroad are prepared to take payment in kind.

The American Government should do nothing to impair the foreign obligations held by its citizens. But it should do nothing involving the slightest national economic loss or inconvenience to enable the holders of foreign investments to collect. The economic relations between nations in the future must be on a pay-as-you-go basis, with the yearly international accounts or payments in even balance by the movements of goods and services. We do not want our national economy to collect goods from abroad in return for no corresponding exports of our goods or services, but merely in return for the cancellation of American claims against foreigners. We want a goods-or service dollar exported for every goods-or-service dollar imported, excluding interest as a service item. It seems unnecessary to attempt here an explanation of how State control of investment will operate. Obviously it will not be one hundred percent effective or inclusive. But it can easily be made effective enough to reduce capital exports to a negligible quantity, which is all that is desired.

The reasons why foreign loans can never be repaid were explained at some length in my Is Capitalism Doomed?, so I shall not restate them here. The repudiation of War debts and the wholesale defaults on foreign bonds since the writing of that book in 1931 should make it unnecessary to give added proof of this obvious fact. Foreign loans are good as long as the lending countries re-lend each year the amount of interest income, as England has done consistently (except during brief periods of temporary misfortune, like war) during her entire history of foreign lending. It is clearly absurd from the point of view of national interest to export goods and services for foreign paper which can never be redeemed in goods and services. With communism and wholesale repudiations the current realities, it can no longer be held that a foreign obligation or property right, represented by a piece of paper, is the equivalent of a domestically-located piece of property. The nation is not the richer for its physical wealth held abroad, and the individual American is not the richer for his savings exported for a foreign piece of paper, the value of which is likely to be cancelled by repudiation, default, communism, or excessive taxation.

By way of justifying public policy in not making sacrifices of national interest to secure or facilitate payment on foreign investments, it should be pointed out that to sacrifice national interest to enable an American investor to collect a foreign loan is not a whit different in any essential respect from taxing the people to make good any ordinary business or investment loss suffered in this country.

It seems superfluous to undertake a lengthy refutation of the liberal argument that any restriction placed on international trade by public policy makes for international friction and war. To refute briefly that argument, it need only be said that trade competition is always a warfare between private economic interests of different nations competing for each other’s markets, and that such private economic warfare is more provocative of warfare between the respective governments involved than a process of adjustment of international trade exchanges by direct agreements between governments. It is far less likely to contribute to a war between governments to have the United States government inform various groups of American exports producers how much they can export and get paid for, than to have them either suffer or inflict a crushing defeat in free international trade competition.

It remains only to discuss briefly the subject of what is here called special foreign policies. Of these, fortunately, we have fewer than the European powers. Our Asiatic immigration exclusion policy is one of these policies. Our open-door-in-China policy is another. Most European colonial policies and military alliances may be classed in this category. Such policies are not strictly necessary for national defense or economic security. These are the policies which furnish most of the immediate causes of war. And these are the policies in respect to which it is possible to make most concessions or concessions with the greatest of ease. At the same time, it is extremely easy to inflame public opinion to violent self-assertion in respect to these policies.

It is a curious insensibility to reality, or a gross insincerity, which has made professed peace lovers since Versailles confine their pursuit of peace mainly to endeavors at concession-seeking in the fields of policies deemed by their champions essential either to national defense or economic security-about all the pacifists talk about is disarmament and tariff reduction-while these peace lovers have completely avoided advancing any significant proposals about those special policies in respect to which concession could easily have been made by the privileged. Indeed, such concession would have served to save the underprivileged from a desperation which, sooner or later, can only produce war. The United States is fortunate in having few of these special policies. Oriental exclusion and the open door in China are about the only important examples. The Monroe Doctrine is no longer to be considered a special policy but rather an accepted imperative of our national defense and of the existing balance of power.

In respect to the special policy of oriental exclusion, it is not to be expected that American opinion will tolerate any fundamental concession. But this intransigence might easily be compensated for in fact by rational and gracious acquiescence in Japanese expansion in northern China, and in renunciation of our open-door policy for China. We should thus be conceding little that is not already lost, or little that is worth much to us. At the same time, we should be giving something of great subjective value to the Japanese.

The diplomacy of the great powers of Europe fairly bristles with special policies which could be modified almost to any extent without involving any impairment of the national defense or economic security of the cession-and concession-granting great powers. England, for instance, though she could not make disposition of territory or economic advantages affecting vitally the self-governing British commonwealths like Canada, Australia, South Africa or New Zealand, could easily and safely make enormous cessions of territory, and concessions of special privileges and opportunities, in her crown colonies, and in India, to help countries like Germany and Italy solve some of their problems, including particularly the problem of what to do with the out-elite. France has African colonies, one of which has far more Italian than French colonists, with respect to which all sorts of concessions could be made without detriment to French military or economic security. England and France, also, have special policies involving military alliances or understandings with countries in central and eastern Europe which are in no sense essential or even useful, for the greater part, to the national defense or economic security of either power.

France has little to offer or to receive in political, cultural or commercial intercourse with the Balkan, central and eastern European succession States of the old Austro-Hungarian Empire, or with Poland. Yet France insists on trying, more or less ineffectually, to maintain a military and financial influence over these countries paramount to that of any other great power. France, being herself a nearly self-sufficient agricultural country, does not want or need the agricultural products of these preeminently agricultural countries. And these poor and undeveloped States with a peasant economy (except for parts of Czechoslovakia) have no business importing heavily of French wines, perfumes, or luxury goods, and luxury French professionals.

France, having no surplus population for export, is not in a position to send to these backward nations the essential technicians and skilled mechanics which they need. If France were attacked by Germany, these new allies would prove more of a liability than an asset. In short, there are no substantial bases of mutually advantageous and complementary commercial, financial, military, or migration collaboration between France and Poland, or France and the central and eastern European States making up the Little Entente. Yet France foolishly pursues the objective of a political hegemony over these States, instead of orientating French diplomacy towards a series of mutually advantageous deals with Germany which might lay the foundations of a prolonged European peace.

Germany, on the other hand, having an industrial surplus and an agricultural shortage, as well as surplus business enterprisers, technicians, and skilled laborers, for export, has every condition needed for a series of useful commercial, financial, and demographic relationships with these succession States over which French influence aims to be dominant. Germany needs these countries, and they need her. The political formulas for permitting the satisfaction of these needs have yet to be worked out. The chief objective of the liberal statesmanship of the Allied countries since the War has been to prevent the realization of any such formulas, which is just another one of the many reasons why liberalism is doomed.

Briefly, then, England and France could easily make cessions and concessions to Germany and Italy, but England and France could not, jointly or separately, win a war against the fascist governments of Germany and Italy, for the excellent reason that England and France cannot possibly restore liberal government where it has fallen, or where it never existed and where its chances of coming into healthy being are less today than ever before. If an Anglo-French military expedition were to be entirely successful in a military way against Mussolini and Hitler, it would be faced with the dilemma of having to maintain a perpetual military occupation or else make peace with, or relinquish the occupied territory to, the communists.

Liberalism and international finance are no longer in a position to finance a liberal regime anywhere with a stream of foreign loans. Besides, the temper of possible liberal leaders and of the people about such leaders in the now fascist countries can be said to render any liberal restoration well nigh unthinkable. The choices everywhere are fascism or communism, and an Anglo-French démarche in Europe which put communism in power could hardly be considered by those in power in England or France today as a victory for their side.

What is needed in a near future to save western civilization from communism and chaos is the coming to power in England and France, as well as in the United States, of fascist-minded leaders, who will change the entire orientation of foreign policy in those two leading European countries. The bases of long peace and helpful international relations must be laid in a statesmanship and diplomacy of realism, rational calculation of costs and probabilities, and honest recognition that there is no right which is not enforced by might.

Are the rights of the privileged nations of England and France, and the States which depend for their existence on the protection of these two powers, worth the costs of attempts at their maintenance in another war which only communism and chaos stand a chance of winning? Or is a new deal, based on a more accurate adjustment to the force and need factors, indicated? Here fascism and liberalism join issue.

An early fascist trend in the United States is needed to save us from being drawn into another wild adventure by the decrepit statesmen now at the helm in England and France, ostensibly to uphold certain rights of England and France and their dependent States of Europe, but actually to plunge Europe into world revolution and chaos. Our Anglophile and Francophile American liberals should recall, in their present reactions to events in Europe, that some twenty-odd years ago they got us into a fifty-billion-dollar war to deliver Germany from Kaiser William and prepare it for Adolf Hitler, who is much farther from the green pastures of liberalism than any Hohenzollern.

These same misguided, emotional, irrational, and frequently hysterical, American liberals with ideas on foreign affairs are now about ready to try to lead us into another crusade to oust Hitler to make place for a communist, who will be still farther from liberalism than Hitler. Liberal leadership everywhere in the world today is flogging the same dead horses of liberal issues which have been definitely lost. Liberalism had its great holy war under

Lloyd George, Woodrow Wilson and Clemenceau. The holy war has been lost. Surely there is enough common sense among the peoples (and, more particularly, among the in-elite of the liberal nations of America, Britain and France), to turn from liberalism before it drags the world into another holy war to uphold certain principles and a status quo, which, incidentally, are inseparable, and which the trend of social forces moving in flood tide since Versailles has been steadily undermining. Only the fascization of the now liberal great powers can save us from another holy war to make the world safe for liberalism, or, rather to hand it over to the Red army of Russia, which is the largest and most fanatical military force in the field.