European Unions M R. HENDERSON is now on his way to
Geneva, where, both in the meeting of the League Council and in the Committee for European Union, the principal .subject of discussion will be the proposals recently made by Austria and Germany, and whatever counter-proposals other nations may bring forward as substitutes for them. Much may happen before these words appear in print. At present: the principal indication we have of what these proposals are likely to be comes from the events which we. described last week. Whatever they are, they emanate largely from the brain of M. Briand, and it is therefore with somewhat mixed feelings that his friends can watch the progress of his last-minute candidature for the Presidency. Should he be successful, his policy will be interpreted, though he himself will be present at Geneva, by Messrs. Laval and Francois- Poncet, both of whom arc known to be. far more of the political - Right than M. Briand. . On the other hand, should he be defeated, he will go to Geneva with his prestige greatly weakened, and will be more open to pressure from Paris than if he had never stood. To those who believe, as we do, in M. Briand as the friend of peace in Europe, either result will seem unfortunate.
There can be little doubt that it is to M. Briand that we owe the general recognition that something more will be needed than a mere negation of the proposed plan. Germans almost universally look upon this proposal as a test case, the result of which will decide whether Germany is to be a free member of the com- munity of nations or, as she has frequently been repre- sented, a " slave," doomed to remain for ever subject in all matters to the will of her conquerors. Acceptance of defeat would bring about the fall of the Bruning Government and almost inevitably the complete political and economic collapse of Germany. France herself cannot afford the loss of reparations which that would mean, and her security would not be improved by the presence on her borders of a revolutionary Fascist or Communist power. The only way out is to do what M. Briand, with the prompt and able co-operation of Dr. Benes, has evidently resolved to do. That is to bring about a reversal of the recent commercial policy of Europe, and somehow to scramble up out of the pit of economic nationalism into which each nation has been falling since 1919. Only by joining in some • such alternative scheme can Germany find the • economic and psychological salvation which she is seeking.
To return to the plan itself, we cannot anticipate the decision of the League Council or the World Court on its legality ; and we still hold that some such union, or one even closer, is an inevitable consequence of the peace treaties. If achieved at the moment it would, how- ever, probably lead to the formation of economic blocs in the whole of Europe, and the evil of this would be accentuated by the fact that, if the German-Austrian example is any guide, the tariff round each bloc would tend to be as high as that of the member which had the highest tariff before it entered the bloc. Thus, though the barriers would be fewer in number, their average height would be greater, and " economic war " would be intensified. This is, indeed, the strongest argument which the French possess, and it will add . immeasurably to the strength of it if the scheme which they propose would have the opposite effect. If some- thing like the economic unity of Europe could by any means be achieved, nobody would have very much to fear from an even closer union of Germany and Austria than that which is proposed.
It is easy to say, therefore, that such a solution is to be preferred. It remains to be seen whether M. Briand has been able to devise something sufficiently far- reaching to fulfil the purpose. The hints which we have had lead us to expect some system of European prefer- ences, by which the industrial and agrarian States of Europe would assist each other to market their respective products. This would be accompanied, we gather, by a system of agreements between the industries of each country which, when completed, would take effect upon tariffs and commercial policy.
Of the first part we have an instance in the suddenness with which the Czechoslovakian agrarians have been persuaded, during the last few weeks, to abandon their objections to a system of preferences within the Little Entente. This is a complete reversal of Czechoslovak commercial policy, and indicates the lengths to which France's allies are prepared to go to avert what they regard as a threat to their independent existence. France herself may have to make similar concessions. M. Laval has recently referred to the desirability of a quota scheme for the import of coal into France. It may be that some solution is to be found on these lines. The second part of the scheme is less definite, and would take longer to put into effect. Here again a quota scheme would help matters, but to magnify such hints into a declaration of policy is unsafe.
Mr. Henderson will have a difficult part to play: He will have to modify German impatience on the one hand, French apprehension on the other. He will have to watch any new proposals, to see that they avoid the -danger of becoming a Continental bloc, arming itself for competition against the United States and the British Empire. He may or he may not be able to make use of the occasion to forward the agreements on hours and conditions for which this country has so long striven, but he will be in a difficult position as a negotiator with the trade unions at his back ready to fight any sacrifice. He will have the coining Ottawa Conference to consider, and the effect on it of any part which Great Britain may agree to play in the salvaging of Europe. Fortunately, it is in his role as mediator that lie is most successful, and during his tenure of office Great Britain has been unusually successful in her conduct of foreign affairs.
Another hopeful factor is the atmosphere of modera- tion in which the statesmen will meet. During the last- month the utterances of European statesmen have, for once, been studiously careful and moderate. M. Briand has mildly complained that he had not deserved such treatment at the hands of German statesmen.
Dr. Belies has recognized the difficulties of Germany and Austria. Both apparently have set themselves to find a way out of the dilemma which will be acceptable to Germany. Dr. Curtius and Dr. Bruning have mainly .directed attention to German difficulties, and have notably refrained from threats of withdrawal from the League. Dr. Schober has said practically nothing what- ever. All alike seem to feel that some form of compro- mise will be necessary. An atmosphere of this kind is, of course, an unreliable basis for hope, for it may change at any minute. At the same time, it is encouraging that it should be so noticeable. It provides,Mr. Henderson with a field for the services which will be required of him. Tle situation is too serious, we believe, for even the statesmen of Europe to make mischief on purpose.
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