With regard to responsibility for the war, by far the most instructive comment is that of Dr. Renner, not only because he is a Socialist and an ardent supporter of the International in its general opposition to war, but also because he enters into long economic and juristic arguments virtually in justification of the Central Empires, and puts forward a formal apologia for the action of the German Social Democrats in supporting war. The two other authorities are content to repeat the stereotyped formula that the Central Powers were forced into a war of self-defence. General von Freytag claims for them that the 'lofty moral strength, arising from the sense of righteous self-defence in a war which had been thrust upon them, showed its superiority to the zeal which a commercial and predatory war could kindle in our enemies.' Dr. Naumann contends that the Central Powers had no defined military aims because they were only prepared for ' defence. . . The war began purely as a war of defence'; and elsewhere he speaks of this war,' which had been thrust upon us.' All this, and more to the same effect, is common form too familiar to call for any comment. They say nothing about the encircling policy' initiated by King Edward, and carried out by the Machiavellian Sir Edward Grey, which figures so largely in earlier dissertations; it seems to have dropped into the background. But Dr. Naumann attributes to England a secret and sinister purpose based on profound calculations, in which, it appears, we were much better versed than the Germans. After referring to their failure to think out the economic situation that would be created by war, he continues:

'But England had a much more adequate notion of the kind of weapon that lay ready to her hand. She examined our annual imports and secretly rejoiced at the thought of the day when she would force us to our knees by threatening to cut us off from commerce or by actually doing so. It must be acknowledged that our economic dependence was better known in the Foreign Office in London than in the corresponding offices in Berlin and Vienna. Without this knowledge, England would not have used for her own settlement of accounts with Germany the war on two frontiers, which we had to fight out with France and Russia.'

It is an unexpected compliment to be told that we could read German statistics better than the Germans themselves; but the facts contradict Dr. Naumann's argument. If he

were right our Government would have immediately seized the opportunity over which it had secretly rejoiced in advance, to use the carefully calculated weapon that lay ready to its hand. As a matter of historical fact our Government displayed great reluctance to use it, and was only driven to do so after long hesitation and delay by outside pressure and the action of Germany, who first declared a submarine blockade of our coasts and then began sinking unarmed merchantmen without warning. Even then it was not until the second year of war that cotton, though a war material, was declared contraband, and not until six months later that the importance of an effective blockade began to be realized. It has since been carried out only by degrees. The theory of a cunning calculation and of war seized as an opportunity to realize it is incompatible with the facts. That a sober and well-informed writer should adopt and advance it shows the peculiar working of the German mind.

Turning from these banalities to Dr. Renner we find a different line of thought. He says, indeed, that' England 'seized on the legal charge of the violation of Belgian neutrality ' as an excuse for her imperialistic war,' and it would be interesting to know what he thinks of the Lichnowsky memorandum. But that statement is rather an obiter dictum, though a significant one. Otherwise he avoids direct discussion of responsibility except in respect of the German Socialists, whom he exonerates in an elaborate argument which will be explained in its proper place. His whole book, it should be understood, is addressed primarily to Socialists; and his analysis of the problems involved in the war, including its causation and consequences, is based on the Marxian doctrine known as the economic interpretation of history, and on the theory that the evolution of capitalism is the governing influence in the present epoch and the key to all social and national relations. The war, therefore, has arisen out of the modern development of capitalism. There is nothing fresh in that proposition by itself. Many other Socialists have consistently maintained it. Indeed, it follows automatically from their axioms. Capitalism is to them a magic word; it explains everything. All evils are due to it, and since this war is a great evil there is no need to look any further for its cause. But that delightfully simple

explanation explains nothing. It resembles the equally childlike proposition that the war is all due to diplomacy.' One might as well say that it is due to the post or the telegraph wires. Diplomacy is the official intercourse between States, and is in the abstract wholly indifferent; it is merely the use of language. Its effects depend entirely on the character of the language used, which is determined by the mind of the user. It is equally at the service of friendship and of hostility or of neither. If war is all due to diplomacy, then so must peace be. The responsibility for either cannot be laid on the instrument, it rests with the user; and the question remains which State had a mind to war and directed its diplomacy to that end. Similarly with capitalism. It is an abstraction, signifying a condition common to all Western nations, according to Socialists; common to both groups of belligerents and to neutrals. A common condition cannot explain different relations-friendship here, hostility there, neutrality in a third quarter; and since it exists equally in peace and in war it cannot be responsible for either. And since war was much more frequent in pre-capitalistic times and among non-capitalist peoples than it is now, the general proposition that it is due to capitalism is untenable.

Dr. Renner is far too acute and logical a thinker to be satisfied with such a childish formula. As a Marxian he sees in economic conditions the mainspring of action, but finds himself constrained to examine them afresh in the light of the war. He starts with the collapse of the International* and the confusion among Socialists caused by an event which has-temporarily at least-upset all their calculations and reversed their theories by uniting classes within nations, and setting nation against nation. They must study the facts, he says, and not be content to go on repeating old formulas which no longer apply. He leads the way by tracing the modern development of national economy. His main line of argument is that the course of economic evolution with its social consequences laid down by Marx as scientific' and inevitable, was correct only up to a certain point, and that in recent years it has taken quite another turn leading to different

*For an account of this organization, see the EDINBURGH REVIEW, October, 1917.

conditions unforeseen by Marx. He works this out in respect of agriculture, industry, trade, and finance, with a mass of detail which cannot be adequately summarized in a limited space; only the barest outline can be given here. He shows that all these economic activities have changed their relations to each other and to the State, and that class antagonisms have changed with them. The concentration of capital described by Marx has been replaced by the centralization' of capital, chiefly through the banks of all kinds, from Raffeisen and savings banks up to the National Bank. By centralization he means that the banks gather up the drops of surplus value which exude from innumerable sources but are in themselves too small to enlarge the business yielding them or to found new ones. The banks, so supplied, finance all kinds of undertakings, agricultural, commercial, and industrial. The result is that capital, instead of being concentrated in ever fewer hands while the rest become more and more pauperized or propertyless-which was to lead to the collapse of the whole system according to Marx-has been more and more distributed, and instead of one capital one capitalist' the order now is one capital many capitalists.' The individual capitalist has nothing to do with the undertakings to which his money contributes, he has only a legal title to his share. At the same time other institutions have been growing up affecting all classes; there are industrial Kartells, consumers' co-operative societies, trade unions and other associations, limited liability companies. These represent organization by private enterprise and self-help. They are not under State influence, but grow up within a framework of legislation and administration peculiar to the State. So the State, which has already interfered by various measures intended for the protection of the weak-compulsory insurance, employment offices, factory legislation-plays an increasing part in the development of national economy, which becomes State-permeated (durchstaatlicht). The highest phase is in the financial sphere. Private capital, become national capital through the development of the banks, enters into close relation with the State and each makes use of the other. National finance is protected by tariff-walls and the State takes part in developing industrial and commercial enterprises. National economy assumes an imperial character.

What bearing has all this on the question before us? Dr. Renner's analysis may be very interesting to Marxian Socialists, but what has it to do with responsibility for the war? The answer is this. The result of the changes described is the fusion of State power and national economy. The development of the latter takes place within the State area, which is identical with the economy area' (Wirtschaftsgebiet). It is a closed economic unit shut off from others by a tariff wall and distinguished by its own body of legislation. Within it all parts and classes are bound together into one whole. The legal control of economy by State law effects economic unification within the concrete form of the concrete State. Crossing a frontier we pass into a different economic region; the standards of wages and prices and the modes of conducting business are different. The frontier is the skin; the body (Wirtschaftskörper) is the aggregate of economic activities within the skin. The unity is real. The means of transport and communication are disposed round a centre, which is an internal market separated from others. All the elements are bound together by a common law, a common State finance, and also by the national capital which is no longer an amorphous international thing like the atmosphere, but strictly organized within the economy area. Each economy area is different from others in size, population, natural and occupational composition, social structure, and stage of historical development. Protective tariffs make size a most important element; he larger it is the greater the gathering ground for capital, and there is a constant tendency to expansion. But, he asks, why not have free trading activity everywhere? The Germans especially-both capitalists and workmen-have spread themselves everywhere and carried on business in every land. Why not go on enjoying the hospitality of mankind? The object of State boundaries and tariffs is to set up a monopoly and eliminate competition; but external competition becomes the keener the more it is restricted by Kartells at home. Spheres of influence' are sought: State agents-diplomats and consuls-are employed to make spheres, lands and people accessible to 'peaceful economic penetration.' But concession hunters of different States compete and the power of the Home State is decisive. So it must become a World State. Power over foreign States is the first political