Germany and Cotton

I

CLOTHING is a human need second in importance only to food. Indeed it can be called second only because it lasts longer, and because, as the consumption of wear takes more time than the consumption of digestion, the need on any particular day is usually less urgent. Since it is a universal need it gives rise to great industries; while the conditions which cause international division of labor enable particular countries to manufacture for the rest of the world. Accordingly the textile trades have for centuries been largely export trades; and the woolens of England, the silks of France, and the linens of Holland and Germany found extensive markets abroad before the advent of steam and machinery. When the age of machinery came, a cheap supply at home of coal and iron gave so great an advantage to countries possessing it, that they found themselves able to continue to produce textiles for themselves and for foreign markets even if they used imported materials.

These considerations apply, it need hardly be said, very directly to the case of Germany. Though before the war the textile industries of that country still furnished about one eighth of the total exports of the Empire, they had been deprived of their pride of place at the head of the list by the marvelous expansion of the iron and machinery trades; and with the improvement in textile machinery there was, as in other countries, some slackening in the rate of increase of the operatives. Yet the decline in relative importance had not prevented an increase in positive magnitude. Taking the figures for the last five-year period before the war, and comparing it with a period ten years earlier, we find that the average annual value of the exports of German textile fabrics, measured in millions of marks, was as follows: —

But while the exports of these stuffs increased some 38 per cent, the population increased only 15 per cent.

The effect on a country of the loss of foreign markets depends naturally on the relative size of the home demand. So far as can be made out from German official statistics, the foreign sale, in the case of cotton goods, is between a third and a half of the whole; in the case of woolens, rather more than a quarter; in the case of silks, rather more than one half.

Of its place in national life a very imperfect idea is given by the numbers employed. A stoppage in the production of clothing must in the long run be as fatal as a stoppage in the production of food. Long before that point is reached, the slackening of output involves so much less demand for those other things which men produce to exchange for clothes. It implies a malaise, a discomfort, a feeling of straitened circumstances, which gradually spreads itself over the whole of society. But even if we look only at the particular industries primarily concerned, the numbers involved are quite considerable. The last returns of the factory inspectors, for operatives engaged in textile factories employing at least ten workpeople,were,in round figures :1910, 911,000; 1911, 922,000; 1912, 947,000. But these figures do not include either persons employed in smaller workshops, or those working at home, or those with whom the occupation is a secondary one. If they could be added, the number would probably be found to be somewhere between 1,200,000 and 1,300,000. Intimately bound up with ‘the textile industry’ proper are the clothing trades, to which the inspectors assigned in 1910, 385,000; in 1911, 398,000; in 1912, 423,000. But in these trades there is notoriously a far larger proportion of home-workers and workers in small shops; probably the factory figures give not more than a quarter of the whole number who found employment.

Rather more women than men are employed in the textile trades, and more than twice as many in the clothing trades; so that relatively fewer people are dependent on those at work than is the case in the heavier and better-paid industries mainly carried on by men. The last occupation census, that of 1907, made an attempt to ascertain the total number dependent on the several groups of trades and their proportion to the total population. The conclusion was a percentage of 3.1 for the textile group and 4.3 for the clothing group, or 7.4 for the two together. These percentages may look small at first sight; but on the same authority all the metal-producing trades accounted for only 4.6 per cent of the population, and all the engineering trades for 3.6 per cent. It will not be forgotten that, large as the manufactures of Germany are, agriculture still accounts for about a third of the whole population.

Not content with these census groupings, the well-known political writer Naumann attempted some years ago a fresh combination of census figures, and reached the conclusion that, counting those branches of the metal and engineering trades occupied in turning out textile machinery, somewhere about a tenth of the whole German population was concerned in, or dependent upon, the production of clothing and clothing materials. So far as dependence on earnings is concerned, this may be an overestimate. But even this fraction is far from giving a just impression of the direct and immediate importance of this side of the nation’s economic activity. For the textile factories furnish the wares (‘dry goods’) for legions of retail traders — drapers, haberdashers, and the like. Nor can we leave out of sight the many thousands of the German population who have invested capital in textile mills and are, to that extent, dependent upon their success. In the years 19101912 there existed some 350 joint-stock companies in the textile trades proper, with a paid-up share capital rising from 616 million marks in the first of those years to 651 millions in the last, and earning on that capital the not unsatisfactory profit of 12.59, 7.87, and 5.36 per cent for the three years respectively, after the deduction of all losses on the part of every single company carrying on business.

II

Enough has been said to give a general impression of the place of textiles in German national life. Let us look more closely into the constitution of the industries themselves. Herein Germany differs from England in important respects. Each of the two main trades, cotton and woolen, is more widely distributed over the country: there is nothing as yet resembling the almost complete concentration of the former in Lancashire and the latter in the West Riding. Cotton and wool, moreover, are not, in Germany, kept apart from one another, industrially or geographically, to anything like the same extent. And, finally, the briefer history of machine industry in Germany is evidenced by the survival of a certain amount of handloom weaving, especially of linens.

But the forces of capitalism pull in the same direction in Germany as elsewhere. The factory has almost displaced the domestic workshop in all the chief branches of textile manufacture, and there has been a steady movement toward geographical concentration. As in other countries, mills tend to multiply near coal; and when concentration has once set in, it is hastened and strengthened by transportation facilities and by the presence of subsidiary trades. And so, although there were thriving textile manufactures elsewhere, — in Alsace, Württemberg, Bavaria, and even in Brandenburg, — two provinces before the war stood out from the rest for the magnitude and compression of their textile activity. A portion, side by side, of Rhineland and Westphalia, with the woolen industries of Aachen, Barmen, and Elberfeld, was coming more and more to resemble industrially the West Riding of Yorkshire, though it was diversified by the silk of Crefeld and the cotton business which found its centre in MünchenGladbach. Similarly the southern half of the Kingdom of Saxony, with the adjacent petty territories, was coming to resemble Lancashire, and Chemnitz was a great cotton-spinning centre; though here again the other textile trades, with all sorts of half-woolens and other combinations of fibre, flourished in the same district.

Whether factoryor home-work, whether concentrated or scattered, all this extensive and expanding department of industrial life was almost entirely dependent, before the war, on the importation of raw material from overseas or from what have since become enemy countries. In the case of cotton this dependence was practically complete. The only other source of supply was Turkey; and the contribution from that country — larger in 1913 than usual — was only one two-hundredand-thirtieth part of the total net importation. Asia Minor can certainly in time produce more cotton than it does; but it will first be necessary to carry out extensive works of irrigation.

Sheep’s wool Germany does, to some small extent, produce for herself; but before the war the Empire certainly received nineteen twentieths of its supply from outside. For many years the number of its sheep has been steadily declining: from 25 millions in 1873 to less than 10 millions in 1900 and less than 6 millions at the last cattle census in 1912. The number can be only gradually increased, and even then not without a serious change in agricultural practice and a concurrent diminution of food-supplies other than mutton. Almost all the outside supply of wool came from overseas; and of that which came by land the only contribution from countries not now hostile was the few hundred tons from Austria-Hungary, amounting in 1913 to about a hundred-and-forty-sixth part of the total net import. Austria-Hungary has more sheep: about 13 to every 5 in her ally’s territory. But considering that before the war Austria-Hungary herself imported two thirds of her requirements, it is most improbable that in time of war she will be able to spare any quantity worth considering.

Silk is for Germany entirely a foreign product. About two thirds of it used to come from Italy and considerable quantities from France. The only country not now engaged in war from which she obtained any notable amount was Switzerland. But Switzerland was of course only an intermediary.

The linen industry is much smaller and produces more exclusively for the home market. Its dependence on the outer world is therefore limited to the supply of material; but there it is very marked. Cotton and silk Germany cannot produce at home; wool and linen she can; but in each case she has chosen to risk dependence on the foreigner in order to make a more immediately profitable use of her territory. And so the fields of flax once conspicuous in certain provinces have been dwindling, — from 335,000 acres in 1878 to 37,000 acres in 1910, — until before the war four fifths of the flax worked up in Germany came from abroad, and three quarters from Russia.

III

That with a vitally important branch of the nation’s activity so dependent for its materials upon oversea sources of supply, the country would be in grave danger in a war with a great maritime power, has long been quite obvious. It was perfectly well known to the more instructed men in German political circles. A sufficient example is furnished by the writings of the late Professor von Halle. Von Halle’s first important book, on Cotton Production in the Southern States (1897), was dedicated to the present writer; his second, on the Economics of the Sea (Volksund Seewirthschaft, 1902), was dedicated to VonTirpitz: I hardly know whether to be gratified or humiliated by the juxtaposition. In the interval Von Halle had put his great abilities, I doubt not with sincere conviction, at the service of the Big Navy party; he had been attached as economic expert to the German Admiralty; he had organized, behind the scenes, the agitation for the naval programme in the universities and had been suitably decorated in reward; and he had early reached the goal of German academic ambition, a professorship at Berlin. It was his function to formulate, and to confirm with all the appropriate statistics and historical facts, every possible economic argument in favor of the naval programme, both in official memoranda and in anonymous publications. Among the latter was the well-known Nauticus yearbook. In the issue for 1900 appeared two substantial essays from Von Halle’s pen: one on the blockade of the Southern ports during the Civil War, the other on its consequence, the Lancashire cotton famine. The facts are set forth clearly and carefully, with this conclusion: —

‘As the other industries of England were flourishing at the time, and in fact were actually to some extent given occupation by the American war, and as the supply of all other raw materials continued unbroken and transportation to and from the country was unhindered, it was possible to carry the Lancashire population over the difficult time. ... A similar measure, applied to a highly industrialized country itself engaged in war, would threaten its whole future, and, if the war ended in defeat, would have consequences impossible to realize.’

The moral that Von Halle suggested from this, as from every other piece of his writing during these years, was, ‘Build a large navy.’ There was never any hint that safety could possibly be found in any distinction between the military and civil use of imports. It was assumed that an enemy who had the power to cut off the supply of necessary industrial materials would not hesitate to use it.

IV

Nothing, however, will strike the future historian as more remarkable than the reluctance of the British government to make this use of its naval power, and its long delay before proceeding to effective measures. Germany was cut off from Australian and South African wool, from Egyptian and Indian cotton, and from Indian jute, simply in consequence of the prohibition of trade by British subjects with enemy countries. A similar cause cut off Russian flax and hemp. But for several months no restriction was placed on the arrival of American cotton by way of neutral countries. Early in 1915 I calculated that, even working halftime, the German cotton mills could not go on for more than about nine months from the beginning of the war, allowing for the confiscation of Antwerp stocks, ‘without fresh supplies.’ The occupation of Lodz, the home of the cotton industry of Russian Poland, would relieve the situation a little. But the fact is that Germany was enabled for some months to obtain very considerable fresh supplies from oversea. During the nine months from September, 1914, to May, 1915, there arrived in the Scandinavian countries and the Netherlands 114,280 metric tons of cotton in excess of the imports in the corresponding period of the preceding year. It can hardly be doubted that at least this much found its way to Germany, even if high prices did not bring over some of the normal import also. But the consumption of cotton in Germany in ordinary times is some 415,000 metric tons a year (the average for 1909-1913). That is, Germany was able, during this period, to replenish her stores by a quantity equal to more than fourteen weeks’ ordinary consumption. It is notorious, and the common belief is borne out by the official figures, that by far the larger part of this cotton traveled by way of Sweden.

On January 7, 1915, the British government declared, with truth, that they had ‘ been most careful not to interfere with cotton, and its place on the free list had been scrupulously maintained.’ ‘On every occasion when questioned on the point,’ they went on to say, ‘ they have stated their intention of adhering to this practice.’ Week by week, however, evidence was accumulating that the cotton was in fact being largely used for military purposes. I am not now referring to its use in the manufacture of ammunition; to that I shall return later: I am referring to its employment for a hundred and one other requirements of the army and navy, — bedding, underclothes, canvas, tarpaulins, waterproof materials, medical stores, aeroplanes, and Zeppelins; as well as, in consequence of the shortage of wool, as an admixture even in uniforms. An order, for instance, of the Austrian Ministry of War of last July directed that ‘in view of the present position of the wool market’ army clothing previously made of fresh wool should henceforth contain 35-40 per cent of shoddy and 10-15 per cent of American cotton. Looking back on my article of June last in the Atlantic, I see that I then still shared the common opinion that the cotton industry ‘ could not be much helped by government orders.’ But the perusal, since then, of dozens of German trade reports has made it very clear that, throughout the war, the cotton factories of Germany, almost if not quite as much as the woolen factories, have lived upon government orders. Their foreign markets are lost; and the lessening purchasing power of the community due to the rise in the price of food, concurrent with an increase in the price of cotton goods due to the cost of materials, has brought down the ordinary civilian demand to narrow dimensions. For a fact of such capital importance as the military consumption of cotton goods, it may be well to adduce some evidence. Here is a report from München-Gladbach in the Frankfurter Zeitung for January 20, 1915: —

‘The continuous and enormous demand of the military authorities for all kinds of goods produced in the district has brought it about that the firms are now fully supplied with orders down to next May or June.’

The same journal reports from the same district a few months later: —

‘In May new orders for summer clothing for the army came in. . . . The cotton-spinning mills are very busy now.’

Reviewing the three months, March to May, the Berlin Börsen-Zeitung remarked : —

‘ Business in the cotton-wearing branch has been somewhat less active than in earlier months. Army orders often ran low, and few fresh orders came in.’

And such indications could easily be multiplied.

Nevertheless the British government might have long hesitated about keeping out from Germany what before this war — with its unprecedented numbers in the field and their unprecedented equipment — might fairly have been regarded as mainly civilian supplies. So long as there was any likelihood that the accepted usages of war would continue to be observed, it would not lightly, in its own future interest, declare cotton liable to seizure. Nothing but the declaration by Germany of the submarine blockade of Great Britain, with the announced intention and speedily exhibited practice of disregard for the lives of noncombatants, would have brought Great Britain as early as March 11 to the point it then reached: the decision, in exercise of ‘an unquestionable right of retaliation,’ ‘ to adopt measures to prevent commodities of any kind from reaching or leaving Germany ' ; even though, as we have seen, that policy in the case of cotton was sufficiently justified by the commonly accepted principles as to ‘warlike stores.’ On the same date, indeed, the British government declared ‘ raw wool, wool tops or noils, and woolen and worsted yarns’ absolute contraband. The intention evidently was to cut Germany off from its one remaining source of sheep’s wool, namely, Argentina. When it is realized that there is no longer any very substantial difference between the extent to which cotton and wool respectively are capable of military use, it is evident that the English government’s abstention for some months from a like announcement in the case of cotton must have arisen, not from any doubt as to principle, but simply from regard to the large American interests involved. It was anxious to avoid the severities hitherto incident to treatment as contraband, especially the confiscation of vessels. And under an agreement made with representatives of the American cotton-growers, cotton shipped before a certain date to neutral destinations was purchased when diverted to British ports. Some indication of the magnitude of the supply that would otherwise have reached Germany is afforded by the fact that for twenty-five of such shipments there was paid over by the British government, before the middle of July, a sum of nearly £700,000.

Before looking at the effects of the stoppage of cotton to Germany, it will be convenient to complete the list of measures of restriction. Lest consignments of cotton to neutrals from England should indirectly reach the enemy, a proclamation of April 26 prohibited its export from British to neutral ports; cotton waste had been subject to a like restriction from the beginning of the war. The special difficulty of Holland was met by the formation of the Netherlands Oversea Trust, which was made responsible for seeing that cotton imported into Holland was not sucked into Germany by higher prices. Sweden also saw her way to prohibit the export of cotton and ceased to be any longer, what a German trade journal frankly called her, ‘an agent for Germany.’ Finding the Scandinavian and Dutch avenues blocked, German merchants turned their attention to Italy; but on May 23 Italy joined in the conflict, and though she did not actually declare war on Germany, she promptly requisitioned the huge stock of cotton that had lately been accumulated at Genoa on German account — to a value, according to a Berlin trade expert, of quite 40 million marks. Germany, before the war, had been in the habit of buying from England a not inconsiderable quantity of cotton yarn; to prevent its reaching her through neutrals, its export was restricted on July 24. Before the next large step was taken, the declaration of cotton as contraband on August 21, the whole problem had entered upon a new phase.

V

The declaration of cotton as contraband was grounded, by implication, on its capacity for use in the manufacture of explosives; for the entry in the list runs thus,—‘raw cotton, linters, cotton waste, cotton yarns, cotton piecegoods, and all other cotton products capable of being used in the manufacture of explosives.’ It is sometimes supposed that the motive assigned was not a motive really operating; and it is pointed out that the British government had itself protested against the threat of Russia, during the RussoJapanese war, to declare cotton contraband for the same reason, on the ground that the quantity employed in ammunition was too small in proportion to its ordinary consumption for civilian use to justify the proposed action. Official opinion in England was long disinclined to the measure, precisely because it had thus more or less committed itself in the opposite sense. But by the summer of 1915 the whole world had been taught by experience that this was a war of munitions as never before. Whatever may have been the case ten years earlier, the quantity of cotton used for ammunition in the present struggle is quite sufficient to justify the new departure. But this needs some explanation.

There is a certain confusion in the public mind, owing to ambiguity in the use of terms. The substances commonly grouped together as ‘explosives’ really fall, so far as the great bulk of them is concerned, into two distinct classes. There is the explosive the purpose of which is to burst, and which is used in mines, torpedoes, shells (except shrapnel), and hand-grenades. For this purpose lyddite to some extent, and now the new compound known as T.N.T. to a much larger, are commonly employed; and neither contains cotton. But there is the much more important explosive the purpose of which is to push, and which serves as a propellant, both in small arms and in guns and heavy cannon of all classes. To avoid misunderstanding, it might be as well, then, to speak simply of ‘propellants’ in this connection.

For a long time the military propellant was gunpowder; and, while that was so, it seemed perfectly natural that sulphur and saltpetre should be treated as contraband. But, toward the end of the nineteenth century, gunpowder was displaced for military purposes by compounds based on nitro-cellulose. Now nitro-cellulose can be made only from substances which contain cellulose: this rules out all animal substances such as wool. There is a choice between vegetable fibres that contain cellulose; but at the outbreak of the war the propellants universally employed were all of them forms (such as cordite) of nitro-cellulose made from cotton waste. Cotton waste is simply material rejected in the ordinary processes of the cotton industry; it was used for the production of cordite and so forth, because it could be obtained in large quantities from the mills, at low prices and of sufficiently uniform quality; and the advantage to a country, in this respect, of possessing a considerable cotton manufacture, continually turning out cotton waste, is too obvious for comment. It is a further illustration of the impossibility, under present conditions, of retaining the old distinctions between military and civil purposes. It need hardly be added that, in default of cotton waste, there is no difficulty in using for the purpose raw cotton, cotton yarn, cotton cloth, and cotton rags.

The new and essential importance of cotton for fighting purposes was very properly pressed upon the attention of the British government by the leading chemists and artillery experts of the country. As was natural, exaggerated estimates were put forward in some quarters as to the quantities involved. But it seems possible, on the basis of the known amounts actually employed in propellants in certain armies and the known size of the operations, to arrive at a tolerably reliable notion of the magnitude of the problem. According to careful calculations, a year’s consumption, at the probable present rate, by the German and Austrian armies (leaving out the Turkish) amounts to some 110,000 tons of cotton. But this is between a sixth and a seventh of the total normal consumption of the Central Monarchies in time of peace, as calculated from the years 1909-1913. Evidently this proportion, especially when added to the other military uses of cotton before described, is more than an adequate reason for treating cotton as contraband.

With so enormous a consumption of ammunition as this war has witnessed, it is almost beyond belief that the German government, with all its foresight, could have accumulated stocks of cotton before the war for more than a few months’ requirements. As we shall see in a moment, as soon as cotton supplies from overseas were effectively excluded, last summer, the military authorities began to draw upon civilian reserves. It might be asked whether the ingenuity of their chemists cannot find a substitute. The ingenuity of chemists, even before the war, had succeeded in producing a nitro-cellulose out of wood-pulp, though it had never actually been used in heavy guns. But as a propellant it is weaker; and this means that its use would necessitate new firing-chambers and new sighting in all existing guns. Rifles might possibly be altered with field appliances; heavier guns would have to go to a workshop. There are rumors that propellants are now being made in Germany from wood-pulp; and it is even said that the Krupps have begun to make suitable guns. But conceive of the difficulty of shifting from one propellant to another in the midst of war, and the complications resulting from the simultaneous use of non-interchangeable ammunition. That the stoppage of cotton might conceivably force Germany to use an inferior substitute is no reason against the stoppage. The necessity of resorting to such a substitute would be a grave military disability, which the governments of the Entente are bound to impose upon the Central Monarchies for purely military reasons, if they have the power.

VI

All I propose to do now is to give an account of some events in Germany since the effective exclusion of cotton, and of the measures to which the government has resorted. I shall leave the reader to draw his own conclusions. As to the facts there is no doubt; there is no need to rely on the biased newspapers of adjacent countries, on the reports of traveling neutrals, or on secret information. In order that the government’s measures may be carried out, they have to be published: the Reichsanzeiger, with its official notifications, regularly reaches other countries. Unless all the leading papers of all parties are suppressed, the facts about prices and employment get into print somehow, sooner or later. Though the German War Office warned the public, early in September, not to answer inquiries about trade, even from neutrals in Germany, without first getting permission, a great amount of exact statistical information does get out. In what follows I shall have no occasion to make any assertion which is not derived from reliable German sources.

I have neither time nor space to deal with Austria-Hungary. It is sufficient to say that in most of its economic measures — in all, I think, that have to do with textiles — Austria-Hungary imitates Germany, lagging behind by an interval which varies from one month to four.

In Germany the command of the situation has been taken, almost from the first, by the War Raw Materials Department of the War Office, with its series of control offices and information bureaus for each of the chief textiles. The primary intention of its action is, not to provide for the needs of the civil population, but to secure, if possible, the supplies required for the army. And the measures on which it decides are announced, and presumably more or less enforced, by the military commanders of the several Army Corps districts.

It will complicate the story if I try to include the minor textiles — silk, flax, hemp, jute. And cotton and wool it will be necessary to take together; partly because a stringency in the supply of one quickly makes itself felt in the other, owing to the possibility of substitution; partly because most textile districts are dependent on both; partly because the operatives belong to the same unions of ‘textile workers.’

The war began by bringing great distress. In the first two months there was much short time and a great deal of unemployment. But the situation was relieved in two ways: by the progressive calling-up to the army of male operatives and by the pouring-in of government orders. Unemployment rapidly decreased until, in the largest of the two textile unions, that of the Social Democrats, it was in March only 4.1 per cent. The price of raw cotton in July, 1914, was 65½ pfennigs per pound; in December it had risen to 91; the price of yarn, at the two yarn exchanges, those of München-Gladbach and Stuttgart, rose 40 per cent, or to much the same extent. But, with the arrival of fresh supplies of the material at the beginning of the new year by way of Sweden and Holland, as already mentioned, raw cotton dropped to 75 pfennigs, and the price of yarn fell in like proportion.

The import of wool was severely curtailed some months before that of cotton, simply because the chief exporting countries were British. Prices rose more rapidly; and before the end of November military-clothing manufacturers were complaining of the scarcity of imported wool. The government thought it necessary to take strong measures quickly; and on December 22, 1914, it enacted a set of maximum wool prices. But I believe there is no important commodity as to which a policy of maximum prices has been found successful in Germany: the holders invariably keep back the supply, if there is any chance (and there often is) of somehow getting better terms. So it was with wool; and early in March the government declared an embargo on all stocks of native wool of the 191415 clip, whether already shorn or not, reserving the whole for army contracts.

The same month of March saw the end, also, of relatively inexpensive cotton, as a result doubtless of the new English policy of March 11; and in spite of the large number of both men and women who left the mills for munition work, the unemployment figures began slowly to rise. In May, both the chief industries received a fillip from the new army orders for summer clothing. But apparently the tightness of the woolen market had not relaxed; and in the middle of the month all existing stocks of army cloth or of materials for it, in any stage, were commandeered.

In the beginning of June, with the blocking of the Italian avenue, the situation in the cotton trade began to look threatening. The Saxon export business was confessed to be quite gone; and, with the rise in cotton prices, the spinners of South Germany began to insert cancellation clauses in all their contracts. The government’s first tentative measure, on June 1, was to call for the notification of all stocks of old cotton rags and new cotton waste, and to declare their expropriation for the use of the state. The War Materials Department next held a conference of representatives of the cotton interests; and although it was assured, on inquiry, that there were stocks to meet the normal demands of peace times for eight months, it determined, ‘ purely as a precautionary measure,’to set on foot a plan for ‘the conservation of supplies.’ These conclusions were arrived at, it would seem, a few days before June 12, 1915; the eight months’ lease of life, therefore, if it is a valid one, and if it is not renewed, may be expected to run out about the first week of February, 1916. But the trade journal which reports the calculation expressly limits it to peace-time consumption, and adds, ‘The present abnormally large military requirements cannot and must not be reduced.’ The price of cotton, which had been 96 pfennigs in May, went to 128 in June; though even that figure now seems moderate in comparison with prices subsequently paid for any small lot of cotton obtainable on the market. A standard count of yarn, No. 30, Pinkops, was quoted on the Stuttgart exchange before the war at 202-206 pfennigs; on June 21 the quotation was 342-352. We are not surprised to learn that the officials of the exchange determined, therefore, to publish no more quotations. In the Rhenish-Westphalian district quotations went on being published, at any rate down to the end of August. They remained on the high level of June, occasionally moving up a few pfennigs; but the fact seems to be that there have long ceased to be any ordinary market transactions, owing to the measures of the government now to be described. A competent German trade expert gave it as his opinion that during June ‘ not a gramme of cotton had found its way into Germany.’ The consequence was the order of July 1, to take effect on August 1.

The purpose of this order — recognized as its purpose by all the German papers — was to reserve for military requirements a very large part of all the cotton in the country. Unless the materials could be proved to have been imported since June 15, 1915, it was prohibited to manufacture wholly or chiefly of cotton (1) stuffs for domestic and table use, (2) stuffs for house-furnishing, (3) ribbons, tapes, and haberdashery in general, (4) embroidery, lace, and velveteen, and (5) stuffs for body-linen, bed-linen, and clothing ‘for which yarns under No. 16 or over No. 32 are used, also all cloths in the manufacture of which more than five shafts are used.’ Evidently the exact scope of the order depends largely on the qualification quoted. I have not the technical knowledge necessary for a personal opinion. Some of the German newspapers, while allowing that ‘the production of many articles used in civil life is no longer permissible,’ minimized the order on the ground that it would affect only ‘superfluities’ or ‘luxuries.’ On the other hand, the trade journal of the clothing industry describes the order as practically amounting to ‘the total stoppage of the German cotton industry, except in so far as it is engaged in the production of military supplies or of certain specialties.’ Anyhow, there was a great outcry in the textile districts. The first effect was to set the mills feverishly at work to use up as much of their stock as possible during the month; but there were gloomy forebodings of the future. In the Chemnitz area it was declared, possibly with some exaggeration, that 30,000 hands would be thrown out of work; it was judged expedient to prohibit all meetings in that neighborhood unless the resolutions had been first submitted. The order came into force on the appointed day; but the remonstrances were so numerous and weighty that, on August 13, the order was so far relaxed as to allow of the manufacture, for three weeks only, of articles of all kinds for all purposes (including military), to one third of the normal amount, reserving to the government the right to requisition any part of it.

Even this the Frankfurter Zeitung characterized as a weak ‘ concession to existing prejudices.’ The control of textile materials, it declared, was going to be in future the ‘most pressing’ of all the raw material questions; and though ‘policy’ might necessitate a temporary postponement of severer measures, the sooner they were resorted to the better. The government did its best to live up to the spirit of these injunctions by ordering, on the same date, that no stocks of raw cotton should be kept back by merchants: they should be disposed of to spinners within two weeks.

It is not easy to ascertain exactly how far the more or less complete limitation of the cotton and woolen mills to military orders has so far affected the operatives. If sufficient material were forthcoming, it might have made a difference only to those skilled workers in luxury branches who could not adapt themselves to army work. There is reason to believe, however, that the two great trades, whether working on army account or not, have for some time been shrinking. The big Social Democratic union before the war had 80,902 male members and 52,122 female. In the first twelve months of the war 37,074 men were called up to the army. But instead of 43,828 men remaining in the factories and on the books, only 37,650 retained their membership in July last, — a shrinkage of some 14 or 15 per cent; while of the women the shrinkage in membership was 23 per cent. The loss was apparently due to their going into munition works. Of those remaining on the books, 6.4 per cent were out of work in July, and 24.6 per cent were ‘on short time and reduced wages.’

Such was the state of things the month before the new forcible restriction came into effect, and while there was the temporary burst of activity.

How the situation presented itself a month later may be gathered from an article contributed to Soziale Praxis on August 19, by Herr Schiffer. Soziale Praxis is known to all economists for its very competent editing, and Herr Schiffer is the chief official of the Federation of Christian (that is, non-Socialist) textile workers, which is strong in Rhineland and Westphalia. Here are some portions of it: —

‘The British naval predominance tends to cut off completely from Germany and Austria all oversea imports of raw materials,’ though it ‘concedes to neutral countries just the minimum of materials required for their own industries. Hence a distressing scarcity of raw materials for the textile industry cannot be avoided. . . . The economic results manifest themselves inevitably as time proceeds. ... It is urgently necessary that those male and female operatives, whose employment is rapidly dwindling, should be drafted into other occupations as soon as possible.

‘The difficulties, however, are not slight, for the male workers in the prime of life have been called to the colors. The workers who remain — elderly men, lads, women, and girls (constituting before the war 53 per cent of workpeople employed) — cannot well be transferred to other occupations, except to a comparatively slight extent. The peculiarities of the textile industry render difficult any large transference of operatives to other industries. Generally the operatives are settled residents; and for them compulsory sudden migration would be a serious hardship. Moreover, the industry is generally confined within well-defined districts; and in these it is the predominant occupation. For this reason the communes concerned (which are mostly poor) find that their resources are inadequate to sustain the demands made upon them for the relief of unemployed operatives. . . .

‘It will hardly be possible to assume that in the ensuing autumn and winter, when the crisis has been reached, the transference of unemployed textile workers to other occupations will be an adequate measure of relief. Offers of work in unfamiliar urban occupations, or in agriculture far from home, will be inadequate for bread-winners, unless the wages be high enough to allow them to remit considerable sums to their families. Hence imperial and state subventions in aid of wages will become necessary.’

I shall not try to pursue the matter further in detail. But apparently the subsequent course of events has been such as might have been predicted. In August, during the three weeks’ respite the unemployment percentage in the largest textile union rose from 6.4 to 8.1., and in September to 10.4. In the middle of September the whole of the new wool clip of 1915-16 was taken on requisition for the army. Early in October, in preparation for the coming winter, the military authorities laid an embargo on all blankets and coverlets of wool, cotton, or mixtures. Meetings were now arranged of the local authorities in the several textile districts to create the necessary organization for dealing with unemployment; which was staved off in the Elberfeld district only by the shortening of hours and the introduction of ‘holiday shifts.’ And before the month was half over, the imperial government, which had repeatedly told the people that labor could easily be transferred, agreed to contribute 75 per cent of the public relief given to unemployed textile workers.

VII

If the German submarine blockade of Great Britain, shocking as it has been to feelings of humanity, had exercised any serious effect upon Britain’s supplies of food or raw materials, there might have been something to say for a proposal that Britain should abandon her effort to exclude cotton from Germany in return for the removal of the submarine peril. Although it might not have been acceptable, considering the military use of cotton for explosives and equipment, it could have been seriously put forward. But the submarine peril, never very formidable, has already been overcome, and it never seriously endangered Britain’s food. During the first six months, the losses by war of British cargoes, according to most carefully compiled statistics, were only two thirds of one per cent of the values carried; during the second six months, they fell almost to one third of one per cent. The prices of food have indeed risen—approximately half as much as in Germany. But that rise is itself largely due to the extraordinarily high wages the people are earning. Explain it as we may, there is no doubt that the material condition of the British working classes is one of unprecedented prosperity.