Page:The Economics of Unemployment.djvu/133

destruction of war can only be paid for in this way.

Now though there is an element of moral or psychological truth in this, it is not, strictly speaking, economically true. This world-war, destructive as it was, did not leave the world, as a whole, seriously diminished in its economic resources. It did not, even in Europe taken as a whole, so seriously reduce our productive resources as to make a long spell of poverty and recoupment inevitable. Almost all the economic cost of the War was defrayed out of the current real income of the world. For the actual destruction of buildings, roads, ships, factories, mines, farms, made a small proportion of the real cost of the War. The rest consisted of quantities of war supplies, including munitions, transport services, food, clothing, etc, representing the current production of the world during the years of war. Even the human cost, in the sense of loss of life and limb, was compensated from the economic standpoint by the normal growth of population in the economic world and, so far as Europe was concerned, in the stoppage of migration to the newer countries. Certain belligerent nations sustained large capital losses, by disposing of foreign investments and incurring foreign debts. But this, of course, meant no diminution of the capital of the industrial world as a whole. Apart from the destruction of the War itself, and some letting down of stocks of raw materials and foodstuffs, quickly recoverable, the productive power of the world was not sensibly diminished by the War, except in the sense that the additions made to the capital fabric and to the labour-