pay his price, and he spent his skill and ingenuity on such goods as were in demand. The trade in arms and weapons was good at that time. These appliances were a means of livelihood to the men at arms and a means of income and prestige to their princely employers. So the traffic went busily on, and the individual craftsmen put forth their best efforts toward enhancing the efficiency of the ruling and fighting classes, whose endeavours, without much collusion but by the inevitable drift of circumstance, converged on the subjection of the community of craftsmen at large and on the exhaustion of the community’s resources. Through its side issue in the commercial enterprise which it fostered the handicraft industry brought to the hands of the politicians a further means of trouble. The trade brought on the price system, and so made it possible for ambitious princes to buy what they needed in their warlike negotiations; with funds in hand stores and munitions could be bought where they were needed, so enabling warlike operations to be carried on with greater facility at a greater distance than was feasible under the earlier rule of contributions in kind. The price system also enabled the warlords to hire mercenaries, and so to organise and maintain a standing force of skilled fighting men, mobile and irresponsible. But to hold one’s own in the competitive use of this new arm the prince must have funds; which led incontinently to all available manner of exactions on trade and commerce, since it was from these sources almost solely that funds could be had. But it led also and equally to an increasing traffic between the princes and the captains of industry, for the use of funds. Funds had become the sinews of war, since the handicraft industry had come to turn out goods for sale and the merchandising trade had made funds accessible in sufficient volume to be worth while. So the princes dealt with the captains of industry, selling what they could and hypothecating what they could not sell, in a competitive struggle to outdo one another at war and diplomacy. The game was then as always an emulative one, in which any advantage was a differential advantage only. Hence the princes engaged, each and several, needed all the funds they could get the use of, and their need was ever present, not to be deferred. Hence they borrowed what they could and where they could, their borrowings being floated by the help of all manner of expedients. Some of these fiscal expedients brought monopolistic advantage to the captains of industry, and so contributed to their further gain and to the concentration of wealth in fewer hands. Meantime, the princely chancelries, being in debt as far as possible, extorted further loans from the captains by seizure and by threats of bankruptcy; and whatever was borrowed was expeditiously used up in the destruction of property, population, industrial plant and international commerce. So, when all