In 1907 the British people are estimated to have produced goods to the total amount of, roughly $10,000,000,000 The nation consumed during that year in personal consumption 7,050,000,000 It spent on capital purposes at home: (_a_) On betterment of its national plant 950,000,000 (_b_) On maintenance of its national plant 900,000,000 It used up goods to the value of (in keeping up and probably increasing its stocks of material on hand) 325,000,000 It exported goods in the form of loans to foreign countries of about 500,000,000 By 1914 the British Empire had probably advanced its income to at least $12,500,000,000; and the surplus of goods which it had to export as loans to foreign countries seems to have increased from about $500,000,000 to $1,000,000,000. What happened in war-time? First of all there was an unprecedented manufacture of munitions and war supplies. This production was needed not only for Great Britain, but also for her Allies. Seven-tenths of what was produced in Great Britain in the year 1907 was immediately used up in the form of personal consumption by its population; accordingly war industrial activities meant either that British production must be increased or British consumption reduced, or that more goods must be bought from foreign countries through the sale of British liquid capital assets. First of all, consumption was cut down; in detail, this was accomplished in the following ways: 1. By cutting down all normal additions to England's national plant, _i. e._, by building no more houses, factories, railways, roads, etc., except for purely war purposes. This expenditure in 1907 amounted to about $950,000,000. 2. By cutting down and ceasing as far as possible to spend money on the maintenance of this national plant, except the minimum required to keep it running. This expenditure in 1907 amounted to $900,000,000. 3. Most important of all, by cutting down civil personal expenditure. This was so far the largest item of consumption that it was here that the most important savings were made. A WHOLE POPULATION AT WORK