Thus the war, and especially the year 1917, has brought about a transformation of the social and administrative structure of the State, much of which is bound to be permanent. Owing to the imperative importance of speed there has perhaps been an undue expansion of the function of the Central Government. But a very large amount of work has been devolved on to local authorities and to new bodies, such as the War Agricultural Executive Committees or the Local Food Control Committees. Taking the year as a whole the Administration has been brought into far closer contact with every aspect of the life of the people, the provinces and the metropolis have been linked more closely together, and the whole community has received an education in the problems of practical democracy such as it has never had before. The Industrial Problem In the second place, the war has profoundly altered the conditions of the industrial problem. Since 1914 the community itself has become by far the greatest employer of labor. It has assumed control for the duration of the war over a great number of the larger private undertakings, it has limited profits by imposing an 80 per cent. excess profits tax, and it has intervened to prevent profiteering in the essential requirements of the nation. Further, the regulation of the trade unions have been suspended for the duration of the war, industry has been diluted throughout, new methods and new industries have been introduced, labor-saving machinery has been everywhere installed, and the speed of production and the number and skill of workers has greatly risen. The nation today is far better organized and far more productive than it has ever been before. With the advent of the new Government at the end of 1916 a Ministry of Labor was created to deal with labor questions. It is still early to speak of the results of its work, but an important step toward the creation of better conditions in the industrial world has been taken in the adoption by the Government of the report of the Whitley Committee, which recommended the development of machinery in the shape of industrial councils, representatives of employers and employed throughout the country, whereby it should be possible to solve the difficulties which will arise by the process of peaceful conference and negotiation in place of the methods of industrial war. Despite all difficulties and the recent increase in industrial unrest, it is probably true to say that as the result of the war there is now a better understanding both by capital and labor of their mutual problems than at any previous time. 1917 in Retrospect