The New Penguin History of the World (171 page)

Economic growth came to an end because of the collapse of investment, but another factor was soon operating to accelerate disaster. As the debtor nations tried to put their accounts in order, they cut imports. This caused a drop in world prices, so that countries producing primary goods could not afford to buy abroad. Meanwhile, at the centre of things, both the United States and Europe went into a financial crisis; as countries struggled, unsuccessfully, to keep the value of their currencies steady in relation to gold (an internationally acceptable means of exchange – hence the expression ‘gold standard’) they adopted deflationary policies to balance their books, which again cut demand. So government intervention ensured that recession would become disaster. By 1933 all the major currencies, except the French, were off gold. This was the symbolic expression of the tragedy, the dethronement of one old idol of liberal economics. Its reality was a level of unemployment which may have reached thirty million in the industrial world. In 1932 (the worst year for industrial countries) the index of industrial production for the United States and Germany was in each case only just above half of what it had been in 1929.

The effects of economic depression rolled outwards with a ghastly and irresistible logic. The social gains of the 1920s, when many people’s standard of living had improved, were almost everywhere wiped out. No country had a solution to unemployment and though it was at its worst in the United States and Germany it existed in a concealed form all around the world in the villages and farmlands of the primary producers. The national income of the United States fell by 38 per cent between 1929 and 1932; this was exactly the figure by which the prices of manufactured goods fell, but at the same time raw material prices fell by 56 per cent and foodstuffs by 48 per cent. Everywhere, therefore, the poorer nations and the poorer sectors of the mature economies suffered disproportionately. They may not always have seemed to do so, because they had less far to
fall; an eastern European or an Argentinian peasant may not have been absolutely much worse off, for he had always been badly off, while an unemployed German clerk or factory hand certainly was worse off and knew it.

There was to be no world recovery before another great war. Nations cut themselves off more and more behind tariffs (the 1930 United States tariff raised average duties on imports to 59 per cent) and strove in some cases to achieve economic self-sufficiency by an increasing state control of their economic life. Some did better than others, some very badly. The disaster was a promising setting for the communists and fascists, who expected or advocated the collapse of liberal civilization and now began to flap expectantly about the enfeebled carcass. The end of the gold standard and the belief in non-interference with the economy mark the collapse of a world order in its economic dimension as strikingly as the rise of totalitarian regimes and the rise of nationalism to its destructive climax mark it in its political. Liberal civilization, frighteningly, had lost its power to control events. Many Europeans still found it hard to see this, though, and they continued to dream of the restoration of an age when that civilization enjoyed unquestioned supremacy. They forgot that its values had rested on a political and economic hegemony which, remarkably though it had worked for a time, was already visibly in decay all around the world.

3
A New Asia in the Making

Europe’s troubles could not be confined to one continent. They were bound soon to cramp her ability to dominate affairs elsewhere and the earliest signs of this came in Asia. European colonial power in Asia was, in the perspective of world history, only very briefly unchallengeable and unchallenged. By 1914 one European power, Great Britain, had made an ally of Japan in order to safeguard her interests in the Far East, rather than rely on her own resources. Another, Russia, had been beaten by Japan in war and had turned back towards Europe after twenty years of pressure towards the Yellow Sea. A century’s bullying of China which had seemed likely to prove fatal at the time of the Boxer rebellion was coming to an end; she lost no more territory to European imperialists after that. Unlike India or Africa, China had somehow hung on to her independence into an era where European power in Asia was ebbing. As tensions in Europe mounted and the difficulty of frustrating Japanese ambitions indefinitely became clear, European statesmen realized that the time for acquiring new ports or dreaming of partitions of the ‘sick man’ of the Far East was over. It would suit everyone better to turn to what was always, in effect, British policy, that of an ‘open door’, through which all countries might seek their own commercial advantage. That advantage, too, showed signs of being much less spectacular than had been thought in the sanguine days of the 1890s and that was another reason to tread more softly in the Far East.

Not only was the high tide of the European onslaught on Asia past by 1914 but the revolutionizing of Asia by colonialism, cultural interplay and economic power had already produced defensive reflexes which had to be taken seriously. As early as 1881, a Hawaiian king had proposed to the Meiji emperor the creation of a ‘Union and Federation of Asiatic Nations and Sovereigns’; this was only a straw in the wind, but already such reflexes were now apparent in Japan. Their indirect operation as catalysts of modernization, channelled through this local and Asian force, set the pace of the next phase of the Hundred Years’ War of East and West. Japanese dynamism dominated Asian history in the first forty years of the twentieth
century; China’s revolution had no similar impact until after 1945 when, together with new change-making forces from outside, that country would once more surpass Japan in importance as a shaper of Asian affairs and would close the Western Age in Asia.

Japan’s dynamism showed itself both in economic growth and territorial aggressiveness. For a long time the first was more obvious. It was part and parcel of an overall process of what was seen as ‘westernizing’, which could in the 1920s still sustain a mood of liberal hopefulness about Japan and helped to mask Japanese imperialism. In 1925 universal suffrage was introduced and in spite of much European evidence that this had no necessary connection with liberalism or moderation, it seemed to confirm once again a pattern of steady constitutional progress begun in the nineteenth century.

This confidence, shared both by foreigners and by Japanese, was for a time helped by Japan’s industrial growth, notably in the mood of expansive optimism awoken by the Great War, which gave it great opportunities: markets (especially in Asia) in which it had been faced by heavy western competition were abandoned to it when their former exploiters found they could not meet the demands of the war in their own countries; the Allied governments ordered great quantities of munitions from Japanese factories; a world shipping shortage gave its new shipyards the work they needed. The Japanese gross national product went up by 40 per cent during the war years. Though interrupted in 1920 expansion was resumed later in the decade and in 1929 the Japanese had an industrial base which (though it still engaged less than one in five of the population) had in twenty years seen its steel production rise almost tenfold, its textile production triple, and its coal output double. Its manufacturing sector was beginning to influence other Asian countries, too; it imported iron ore from China and Malaya, coal from Manchuria. Still small though its manufacturing industry was by comparison with that of the western powers, and though it coexisted with an enduring small-scale and artisan sector, Japan’s new industrial strength was beginning to shape both domestic politics and foreign relations in the 1920s. In particular, it affected its relations with mainland Asia.

A contrast to the pre-eminent and dynamic role of Japan was provided there by the continuing eclipse of China, potentially the greatest of Asian and world powers. The 1911 revolution had been of enormous importance, but did not by itself end this eclipse. In principle, it marked an epoch far more fundamentally than the French or Russian revolutions: it was the end of more than two thousand years of history during which the Confucian state had held China together and Confucian ideals had dominated
Chinese culture and society. Inseparably intertwined, Confucianism and the legal order fell together. The 1911 revolution proclaimed the shattering of the standards by which traditional China lived. On the other hand, the revolution was limited, in two ways especially. In the first place, it was destructive rather than constructive. The monarchy had held together a vast country, virtually a continent, of widely different regions. Its collapse meant that the centrifugal regionalism which so often expressed itself in Chinese history could again have full rein. Many of the revolutionaries were animated by a bitter envy and distrust of Peking. Secret societies, the gentry and military commanders were only too ready to step forward and take a grip of affairs in their own regions. These tendencies were somewhat masked while Yüan Shih-k’ai remained at the head of affairs (until 1916), but then burst out. The revolutionaries were split between a group around Sun Yat-sen called the Chinese National People’s Party, or Kuomintang (KMT), and those who upheld the central government based on the parliamentary structure at Peking. Sun’s support was drawn mainly from Canton businessmen and certain soldiers in the south. Against this background warlords thrived. They were soldiers who happened to have control of substantial forces and arms at a time when the central government was continuously weak. Between 1912 and 1928 there were some 1300 of them, often controlling important areas. Some of them carried out reforms. Some were simply bandits. Some had considerable status as plausible pretenders to government power. It was a little like the end of the Roman empire, though less drawn out. When no one took the place of the old scholar-bureaucrats, the soldiers hastened to fill the void. Yüan Shih-k’ai himself can be regarded as the outstanding example of the type.

This reflected the second limitation of the revolution of 1911: it provided no basis of agreement for further progress. Sun Yat-sen had said that the solution of the national question would have to precede that of the social. But even about the shape of a nationalist future there was much disagreement, and the removal of the dynasty took away a common enemy that had delayed its emergence. Although eventually creative, the intellectual confusion marked among the revolutionaries in the first decade of the Chinese Revolution was deeply divisive and symptomatic of the huge task awaiting China’s would-be renovators.

From 1916 a group of cultural reformers began to gather particularly at the university of Peking. The year before, one of them, Ch’en Tu-hsiu, had founded a journal called
New Youth
, which was the focus of the debate they ignited. Ch’en preached to Chinese youth, in whose hands he believed the revolution’s destiny to lie, a total rejection of the old Chinese cultural tradition. Like other intellectuals who talked of Huxley and Dewey
and introduced their bemused compatriots to the works of Ibsen, Ch’en still thought the key lay in the West; in its Darwinian sense of struggle, its individualism and utilitarianism, it still seemed to offer a way ahead. But important though such leadership was and enthusiastic though its disciples might be, an emphasis on a western re-education for China was a handicap. Not only were many educated and patriotic Chinese sincerely attached to the traditional culture, but western ideas were only sure of a ready welcome among the most untypical elements of Chinese society, the seaboard city-dwelling merchants and their student offspring, often educated abroad. The mass of Chinese could hardly be touched by such ideas and appeals, and the demand of other reformers for a vernacular literature was one evidence of this fact.

In so far as they were touched by nationalist feeling the Chinese were likely to turn against the West and against the western-inspired capitalism which, for many of them, meant one more kind of exploitation and was the most obvious constituent of the civilization some modernizers urged them to adopt. But for the most part China’s peasant masses seemed after 1911 relapsed in passivity, apparently unmoved by events and unaware of the agitation of angry and westernized young men. It is not easy to generalize about their economic state: China was too big and too varied. But it seems clear that while the population steadily increased, nothing was done to meet the peasants’ hunger for land; instead, the number of the indebted and landless grew, their wretched lives frequently made even more intolerable by war, whether directly, or through its concomitants, famine and disease. The Chinese Revolution would only be assured success when it could activate these people, and the cultural emphasis of the reformers sometimes masked an unwillingness to envisage the practical political steps necessary for this.

China’s weakness remained Japan’s opportunity. A world war was the occasion to push forward again her nineteenth-century ambitions. The advantages offered by the Europeans’ quarrels with one another could be exploited. Japan’s allies could hardly object to her seizure of the German ports in China; even if they did, they could do nothing about it while they needed Japanese ships and manufactures. There was always the hope, too, that the Japanese might send their own army to Europe to fight, though nothing like this happened. Instead, the Japanese finessed by arousing fears that they might make a separate peace with the Germans and pressed ahead in China.

At the beginning of 1915 the Japanese government presented to the Chinese government a list of twenty-one demands and an ultimatum. In effect, this amounted to a proposal for a Japanese protectorate over China.

The United Kingdom and United States did what diplomacy could do to have the demands reduced but, in the end, the Japanese got much of what they asked for as well as further confirmation of their special commercial and leasehold rights in Manchuria. Chinese patriots were enraged, but there was nothing they could do at a moment when their internal politics were in disorder. They were so confused, indeed, that Sun Yat-sen was himself at this moment seeking Japanese support. The next intervention came in 1916, when Japanese pressure was brought to bear on the British to dissuade them from approving Yüan Shih-k’ai’s attempt to restore stability by making himself emperor. In the following year came another treaty, this time extending the recognition of Japan’s special interests as far as Inner Mongolia.