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Workers’ International News, December 1938


“War to the Knife”


From Workers’ International News, Vol.1 No.12, December 1938, pp.10-11.
Transcribed by Ted Crawford.
Marked up by Einde O’Callaghan for ETOL.


When British Tory ministers speak hopefully of a reversal of recent trends, a revival of world trade, a new turn to prosperity, they are consciously whistling to keep up their own spirits, because almost in the same breath they discuss new economy measures, savings in national and local government expenditure, measures which experience has taught them can only deepen the slump. And figures for world trade show a steady decline throughout the year. The foreign trade returns compiled from the records of 53 nations – practically the entire world – show that instead of the usual seasonal upward turn at the end of the summer due to the appearance of the European harvests on the market, there has actually been a further decline. Latest returns for British overseas trade shows that not only are both imports and exports dropping in comparison with last year’s figures, but the drop grows more steep each month. United States figures show a decline even from last year in which the “recession” was already far advanced.

It is against this background of universal decline that the Anglo-American Trade Treaty must be viewed. The desperate thrusts made by Japan in China, by Germany in the Balkans and in South American, arise from the perilous position in which their national economy has been placed by the developing world slump; menaced in this way, Britain and America which are themselves now faced with crisis have been forced to smooth over outstanding differences to draw together in defence of their common trade interests in Latin America and China insofar as it is possible for bitter rivals to draw together.

The bold words and bolder deeds of Japan in China are out of all proportion to her capacity to back up her claims with military force. In the first place, the Japanese economic structure lacks a basis in heavy industry, and dependent as it is on textiles and secondary manufactures, it is the first to feel the effects of dwindling world markets. Japanese shipping predominates in the East, but the mercantile fleet is composed for the most part of second-hand ships purchased from her rivals, since she, has no considerable shipbuilding industry, and with this antiquated equipment she survives only by the imposition of subhuman conditions on the workers. Japanese agriculture, carried out on the narrow strips of arable land in a mountainous country, has caused the exhaustion of the soil and necessitates the use of huge quantities of fertiliser, which as bye-products of iron-smelting and coal-distillation, cannot be produced in sufficient quantity in a Japan which lacks both iron industry and coal mines; again Japan is placed in dependence on imports from the United States if her teeming millions are to be fed on the traditional handful of rice. To pay for fertiliser, silk must find a market, and when American silk-purchasers declined in the present slump, fertiliser imports fell catastrophically, so that the American recession imposed starvation on the Japanese as well as on the millions of unemployed American workers.

Corresponding to her top-heavy industrial structure, Japanese finance is notoriously unstable and has trembled on the verge of the abyss over a period of years. The need for a basis in heavy industry has forced Japan into a series of adventures on the mainland where she hopes to find the necessary raw materials as well as markets and populations to exploit. But the absence of heavy industry diminishes her chances of success, all the more so because she is compelled to hold her forces in reserve to face the coming world war and does not dare throw more than a fraction of her fighting forces into the Chinese adventure.

Chinese strategy is based on a slow exhaustion of Japan, systematically falling back before her troops and leaving her in possession of gutted towns and a devastated countryside. British, French and American imperialist interests are content to look on, to accept the bombing of their ships, the seizure of their property, the inroads upon their trade, the series of hectoring orders, because as the war drags on and Japan is increasingly exhausted, her chances of enjoying the fruits of victory grow correspondingly slender. The angry tone of the European imperialists of a few months back has been replaced with an unnatural tolerance. To-day they float silently over the Chinese battlefield like vultures waiting till the firing ceases before they settle to feast on the corpses. Their only fear is that Japan may reach breaking point before she has conquered China for them, and the inevitable and long delayed Japanese revolution, with its repercussions throughout the world, rob them of the anticipated plunder. With concurrent interests in the Far East, Britain and America draw together in a Trade Treaty of mutual concessions, and the White House is got ready for the Royal visit.

In unison, too, they chorus their condemnation of the pogroms in Germany, while the Nazis pointedly remind them of their treatment of the minorities under their own rule – the lynching of negroes in the United States, the barbarous repression of the natives in British Africa. It is, of course, no accident that the belated protests against Nazi anti-semitism, the trial of Nazi spies and the recall of the Berlin ambassador occur simultaneously with the announcement of the intensified American drive to capture the South American markets, the arrangements for United States credits in Latin America and the launching of Roosevelt’s vast new arms programme to “defend from aggression” the South American Republics. The victories of the “democratic” elements over the Latin American fascists, the crushing of the fascists revolts, the expulsion of German and Italian settlers and commercial agents from South American republics, these episodes mark the retreat, step by step, of German commercial influence before the determined drive of American Imperialism to assert to the full its economic hegemony in South America.

Simultaneously Britain has been busy conducting a like drive in South Eastern Europe. Ever since Hitler turned his eyes decisively towards Austria, early this year, British Imperialism has been busy building a Maginot Line of credits across the Balkans, reorganising their alliances, receiving their kinglets, financing their loans, arranging their military defences and directing their politics. The vicissitudes of Balkan politics, like those of the South American republics, have always reflected the ambitions and intrigues of the great powers. With their predominantly peasant populations paralysed by centuries of rural inertia, the palace cliques have carried out the designs of their imperialist hackers unhampered by the popular control. As the imperialist antagonisms have sharpened they have reflected themselves first of all in the puppet states in the making and unmaking of kings, in assassinations and terrorist plots. The corpse of Codreanu is now added to the mound of dead Balkan politicians to commemorate a victory for British Imperialism, and the City of London may now invest its millions in Roumania in greater safety.

German imperialism stands desperately in need of the markets and the primary products which are now being wrested away by rivals. With cheaper and more productive labour at her disposal, with better transport facilities to the Balkans, Germany nevertheless lacks one asset which these rivals possess – an accumulation of fatty tissue in the shape of capital reserves, which enables them to face a famine. Reduced to a financial skeleton, confronted with the prospect of vanishing markets, she is, like Japan, forced into one desperate adventure after another.

The bourgeois politicians now speculate on the date of Germany’s next move and its direction. They differ in the matter of months and miles, but that Germany will move and move soon is universally taken for granted. The conclusion of the Anglo-American trade pact has brought the “next crisis” perceptibly nearer.

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Last updated on 17.11.2005