The Realistic Price of Peace

The importance of the Dumbarton Oaks proposals for the peace of the world is well recognized, but there is grave danger of overemphasizing their feasibility and adequacy to the exclusion of other essentials of peace and prosperity, such as those raised at Bretton Woods. Prosperous peace, like the British Empire, must be built on trade, and that trade after the war must be freer among the nations than has been the case in the last twenty-five years. It must include trade in the products of agriculture, which, with technology, reorganization, and planning’, has more than held its own on the production front, even in Europe, in the face of wartime shortages of manpower and fertilizer. The trade must be supported by a stable currency system and an orderly flow of capital from surplus to deficit regions. This combination of essentials is set forth with cogency and thoroughness by Karl Brandt in his latest book, “The Reconstruction of World Agriculture,” which should be required reading for all Congressmen and Senators, particularly those with farm constituencies looking for tariff protection. With a varied academic and official experience in pre-Hitler Germany and subsequently in the United States, this author presents an unsurpassed interpretation of the world agricultural situation before and during World War II and offers wellfounded warnings as to the immediate, intermediate, and long-range future. As professor of agricultural economics in the Food Research Institute of Stanford University, he has been able to use the most reliable data on the subject.

At the end of hostilities there will have to be food relief in certain important areas of Europe, but this will be limited unless there is unwise administration, chaotic revolution, and disorganized destruction, which could be a gloomy picture in Germany. White bread, fats, and soap will be the most significant symbols of peace. There must be planning of relief and rehabilitation to supplant the brutal efficiency of the overthrown Nazi system in liberated countries. Britain and the United States can and should control this since they own and control most of the ocean shipping. Not donated relief, which is never sufficient, but opportunity to sell and buy is what many liberated countries will want. If given the chance, many can pay their own way in the period of rehabilitation. Brandt emphasizes the importance of keeping the modified economic systems going. The most acute areas are Poland and that portion of Russia which was subjected to “scorched earth” treatment by retreating Russians and then by retreating Germans. However, supplies to Russia will be on no basis of charity.

As to the long-range prospects, it is important to bear in mind that Continental Europe has witnessed a substantial improvement in its agriculture through German-compelled practices, both scientific and managerial. Many of these changes will prove permanent and will minimize future dependence upon farm products from overseas. Great Britain, for reasons of industry and commerce, should return to less agriculture and more food imports. The Dutch and Danes will return to importing feeds and exporting high-quality foods. Russia’s restored agriculture will continue to improve under the impact of applied science and technology. If great farm areas like the Danube Valley go industrial, their agriculture will become industrialized and more productive. As an exporter of farm products to Europe, Argentina will be a greater contender than ever.

The author warns against a heedless expansion of American agriculture into realms of relative overproduction after World War II, as was true after World War I. With increase in mechanical power, scientific practices, and business management in farming in America and other countries, there inevitably is room for relatively less and less population in this general occupation, since there are limits to the expandibility of the consumption of agricultural products. Expansion of employment must be found in industry, commerce, and services, not in agriculture with a shrinking labor demand. Any steps to settle veterans on farms on a large scale will be a disservice.

The best hope for agricultural prosperity is in a healthy development of industry, trade, and transportation, with “the generation of effective demand for food and fibers.” This is particularly true of American agriculture, which is more closely linked with the market economy than that of any other country. Protective tariffs and other features of economic nationalism must be checked along with political isolationism. In special cases of drastic damage to private industry through tariff reduction, governments should avowedly absorb the shock in the interest of greater trade and greater good. Unless a more mature opinion as to international economic relations prevents a repetition of the restrictive policies of the recent past, the hope for a democratic and prosperous world will be in vain.

But reconstruction and readjustment of the world’s agriculture must reckon with the political power of farm groups in many lands. Some thirteen hundred million people, or more than half the inhabitants of this earth, still live as farmers. Outside of England and Russia, there is a tenacious physiocratic “fundamentalism” that gives farmers great appeal in national policy. Farm groups are acquainted with government intervention and are conscious of their power. They Cannot be ignored or completely appeased without disastrous consequences. Moreover, farm groups in fascistic nations have reaped benefits from arbitrary and artificial manipulations. German Junker regions remain to be democratized.

To meet the whole complex situation on the farm front will require a bold and understanding statesmanship at the end of hostilities, during demobilization., in the period of transition, and in handling issues for a permanent peacetime agriculture. International machinery is not enough. National policies must be geared to a good international order. This was not done by the United States or by other major powers after World War I. Even President Wilson authorized Herbert Hoover on November 18, 1918, to issue a statement disclaiming any obligation to continue the economic functions of Inter-Allied councils beyond the period of the war. The Hull trade agreements were in the right direction, but, through no fault of Mr. Hull, were too little and too late.

The war, while wrecking the inadequate system of world trade, has broken down many petty trade barriers and brought about great regional or continental group systems of trade and production. As these wartime compartments are abolished, steps should be taken to restore and expand world trade and to minimize any revival of particularistic economic self-determination. Moreover, military defeat of the enemies must be followed speedily with economic action to fill the void in the critical period. In these matters, the United States as the world’s leading power has a great responsibility to bear in mind that international policy begins at home and to adopt a bold economic program favorable to international trade going and coming. This is not easy, as Brandt observes, but it is the realistic price of peace.