Keynes rewinds to the economic world the war destroyed. Before 1870 Europe was substantially self-sufficient; after 1870 an unprecedented fifty-year expansion reversed Malthusian pressure as population grew and food became easier to secure. Labour's purchasing power over food increased until about 1900; tropical Africa and oil-seeds added new cheap calories. What earlier economists would have called an economic Eldorado became ordinary expectation. Malthus's devil had been chained for fifty years; Keynes warns he may be loose again.
The Londoner of 1914 could telephone for the world's products, invest globally, travel without passport anxiety, and treat militarism as newspaper amusement. He regarded the system as normal, certain, and permanently improvable. Keynes insists this was an extraordinary episode that ended in August 1914, not the natural order of history. The serpent in the garden was already visible in newspaper headlines about imperial rivalry, yet seemed to touch almost nothing in daily economic life.
He catalogs population engines on the eve of war. Germany surged from forty to sixty-eight million, transforming from agriculture into an industrial machine that had to spin ever faster to employ its people and buy food abroad. Austria-Hungary and European Russia followed the same logic at even greater scale. Nearly three hundred million people lived within the Russian, German, and Austro-Hungarian systems, bound by reduced tariffs and integrated transport. Those numbers supplied military strength; deprived of livelihood they would threaten European order.
The delicate organization rested on stable gold-linked currencies, minimal frontiers, coal distribution, and foreign trade centered on Germany. German coal output quadrupled between 1871 and 1913; Germany became the largest customer and supplier for much of the continent, investing capital eastward through peaceful penetration. Society also depended on a double deception: workers received little of the cake they helped bake, while capitalists were praised for saving rather than consuming it. The cake grew, but the system was narrow and unstable.
Organization, shipping, and imported food composed a delicate balance relative to appetites. American harvests and Hoover's guaranteed price temporarily masked strain after the war, but the United States could not forever raise its own cost of living to feed Europe. This chapter supplies the baseline against which the Peace must be judged: dismantle the organization that fed the continent and you court starvation and political rage.
Coming Up in Chapter 3
Chapter 3, The Conference, shifts the lens. But it will be easier to appreciate the true origin of many of these terms if we examine here some of the. Keynes moves from the argument so far into the next layer of evidence and consequence..
