What this theory actually means is that the normal development of industry and finance will automatically bring about international peace, and that socialism and even democracy are quite unessential to that end. Socialists may cry for peace, but they might as well cry for free air. But the theory concedes too much and goes too far. It is tainted with the same ultra-rationalistic spirit as is the earlier socialist theory, from which it is a reaction. War is not fought for economic motives alone, although these are important. Serbia would have been less vindictive had Austria conceded her an outlet for her trade, but in any case Serbia would not willingly be ruled by Austria, nor Bulgaria by Greece. Racial pride, religious prejudice, ancient traditions of all sorts still divide nations irrespective of economic interest. You cannot reduce a nation to a single unit thinking only in economic terms. Moreover, even on the purely economic side there are infinite chances for war in the distribution of the profits of joint enterprises among the capitalists of the various nations. We all know how “gentlemen’s agreements” are broken as soon as it is profitable for the gentlemen to break them, and we cannot wholly trust irresponsible magnates, whether industrial or political, to be even intelligently selfish. Moreover, in the present state of the world the higher imperialism is a policy fraught with the very dangers and difficulties which it seeks to evade. If the capitalists of Europe were determined to exploit South America under a joint European control, the decision might directly lead to war. There are too many vested national interests in colonies, dependencies and spheres of influence to make internationalization of investment an immediate specific against war. [Sidenote: Internationalization of investment is only one step towards peace.] But in this matter of the higher imperialism we are less concerned to know how false than how true it is. It is a thing to be desired if it circumscribes war, even though it does not end war, if it tends towards peace, even though it does not by itself alone assure peace. We believe that this present war is not unlikely to end in a combination of great nations with enormous capital, willing to enter upon foreign investments jointly. The great capitalists, who influence if they do not rule our modern industrial nations, will often discover that it is cheaper to divide than to fight. It will be better to have twenty per cent. of a Chinese loan without going to war than thirty per cent.—or nothing at all—after a war. They will strive for the peace of “understanding”—the peace of give and take.