If so, we get the following results for the cost of the fighting period:—­

Total Government expenditure,
August 1, 1914, to November
9, 1918 L8612 millions. 
Less estimate of normal peace expenditure 860 "
-----
7752 "
Less Loans to Dominions 220 millions. 
Less Loans to Allies
(half face value) 740 "
Realisable assets 1300 "
——­
2260 "
——­
Net cost of period L5492 "

If war cost would be good enough to cease with the fighting we should thus now be able to see, more or less, how we stand.  During the fighting period the Government raised by taxation the sum of L2120 millions,[1] from which we have again to deduct L860 millions as an estimate for normal peace taxation, if the war had not happened, leaving L1350 millions as the net war taxation, and L4142 millions as the net addition to debt from the war.

[Footnote 1:  Economist, Nov. 16, 1918.]

But, of course, there are still some large and uncertain sums to come in to both sides of the account.  There is the cost of maintaining our Army and Navy during the armistice period, the cost of demobilisation, and the cost of putting an end to war munitions contracts running for many months ahead, holders of which will have to be compensated.  Who has enough assurance to venture on an estimate of the cost of these items?  Shall we guess them at something between L1000 and L1500 millions?  And when we have made this guess are we at the end of the war’s cost?  Ought we not to include pensions to be paid, and if so, at what figure?  Fifty millions a year for thirty years?  If so, there is another L1500 millions.  And interest on war debt, and for how long?

On the other side of the balance-sheet, the only asset that has not yet been included in the calculation is the sum that we are going to receive from Germany, Some cheery optimists think that it is possible for us and for the Allies to make Germany pay the whole of our war cost.  If so, we have halcyon days ahead, for not only shall we be able to repay the whole war debt but also to pay back to the taxpayer all the L1350 millions that he produced during the war, unless, as seems more likely, the Government finds other uses, or abuses, for the money, and sets its motley horde of wasters to work again.  But this problem, of course, is not going to arise.  It would not be physically possible for Germany to pay the whole of the Allies’ war cost, except in the course of many generations, and, moreover, the Allies have bound themselves not to make any such demand by the rider that they added to President Wilson’s peace terms, in giving their assent to them as the basis on which they were prepared to make peace.  Early in November they stated that President Wilson’s reference to “restoration” of invaded countries should, in their view, be expanded into