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New Zealand in the World

7 — The Approach of War

page 113

The Approach of War

The Great Depression and the political tensions that followed it sapped that basic sense of security which was the very foundation of Dominion status. The profound shock of the economic crisis, beside which the 'depressions' of the nineteen-twenties looked like prosperity, threw the economic policies of the British Commonwealth into a melancholy confusion. Britain herself abandoned free trade, and with her Dominions sought relief in currency depreciation; and in all parts of the Commonwealth men turned again to find salvation in imperial co-operation. The result was the Ottawa Conference of 1932 to which (said the chief New Zealand delegate) the peoples of the entire world looked expectantly for a striking lead towards prosperity. The Ottawa agreements undoubtedly affected the trade of the Empire and of the world as a whole, but interminable debates among experts as to whether the effect was ultimately beneficial, and as to which Empire countries (if any) have been true to the 'spirit page 114of Ottawa' do not suggest that the high hopes of the Conference have been fully realised. Certainly Ottawa did not entirely remove the main threat to New Zealand's future which had been emphasised by the depression: namely, the possibility that the British market for her products might not remain permanently free and unlimited. The possibility of restrictions or taxes on her exports to Britain has remained a nightmare for New Zealand ministers, and a reminder that the old secure (if fluctuating) prosperity within the Empire might be overthrown at a moment's notice.

The economic threat remained in the background, but the fact that the world of the nineteen-thirties was not to be free from war was plain to all. September 1931, the month in which economic stress brought coalition governments in Britain and New Zealand, saw Japan's decisive attack on Manchuria, and the League's failure to bring peace with honour made a deep impression throughout the Commonwealth. War had been used successfully by a great power as an instrument of national policy; and the lesson was later and successively emphasised by the rise and conduct of Herr Hitler, by Italy's Abyssinian adventure, and by the civil war in Spain. War, though outlawed, had shown its face in the Far East, and reappeared close to the Empire's heart in London; and realisation that there might be worse to follow page 115tightened the bonds between Empire countries. Outlying Dominions in particular began to take a new interest in defence, and to realise again the importance of that help which it was assumed would be forthcoming from Britain. The tendency was, therefore, for Dominion freedom of action to be curtailed by a growing sense of political and economic insecurity. In this matter, however, New Zealand reversed the normal sequence. In the spacious days of the nineteen-twenties she was silent, or subservient to Britain, but in 1936, with her first Labour Government in office, she was determined to express her own independent views on foreign affairs.

The revolution in New Zealand's policy can be seen most clearly in her view of the League of Nations. To Massey at the Peace Conference the whole idea of the League was a distasteful piece of idealism foisted on the Empire—like mandates—by the United States of America. He thought that New Zealand's contribution to the League was at best waste of money, only to be endured because otherwise it would not be decent to accept the Samoan mandate; and membership of the League was an awkward reminder that some people thought of Dominions as autonomous communities instead of as loyal dependencies. In 1920 New Zealand's High Commissioner in London (and former Minister of Defence) fruitlessly suggested that the Dominions should not exercise their right to act page 116independently within the League, but should 'transmit representations through Britain after consultation'; and Sir Francis Bell, one of her delegates in 1926, vehemently criticised the idea that a Dominion might be elected to one of the non-permanent seats on the Council. Such an arrangement, he thought, might lead to the undesirable spectacle of a public debate at Geneva between the mother country and a minority Dominion: it would either duplicate or cancel Britain's vote. His own rule, correctly interpreting his Government's views, was to avoid any suggestion 'that New Zealand was entitled to a voice in foreign affairs other than as a very, very small fraction of that great Empire.' Thus, up to 1935, New Zealand at Geneva upheld her characteristic thesis, and confined any criticisms she had to make to confidential imperial discussions. New Zealand delegates occasionally took a useful and independent part in small matters—in 1926 there were some points on which Bell himself differed from British experts—but on major issues they faithfully reflected the views of Britain.*

Such was the policy against which the new Labour Government dramatically rebelled in 1935 and 1936. It was no longer willing to act merely as dutiful echo to the United Kingdom. It had opinions of its own and defended them in public during the critical years 1936-39. In its view, one of the essential weaknesses of the League in the past had been 'its tendency

* Stewart, Sir Francis Bell, Chapter xxii.

page 117to avoid or postpone decisions of difficulty', and so frustrate the principles of its own Covenant. The remedy was clearly to act more and talk less, and if possible, to strengthen international machinery. The moral of the Abyssinian failure was, to New Zealand, to put more teeth into the Covenant rather than to follow the more popular plan of extracting those which had decayed unused. Such was the theme of a comprehensive scheme put forward in September 1936, which renewed the old suggestion of an international police force, and even suggested the revival of that Geneva Protocol of 1924, against which New Zealand had once led an all-Dominion chorus of protest. Nor was New Zealand's crusade confined to generalities. In her view 'the tragedy of retreat from collective security', and the 'return to the laws of the jungle' under League auspices was being enacted before her eyes in the treatment given to Abyssinia, Spain, and China. Her spokesmen repeatedly, and often in plain undiplomatic language, urged that the League should be true to its principles in organising assistance to victims and in refusing to recognise ill-gotten gains. Often New Zealand went on record to this effect during public sessions: and it is credibly reported that plain speech in committee work sometimes strengthened the cautious phraseology of League resolutions. As late as May 1939 New Zealand formed one-half of a minority of two which favoured the principle of active collective aid to China.
page 118

New Zealand's interest in world affairs was shown simultaneously in other directions. In 1936 and 1937, for example, she attempted to find new markets for her exports by a series of direct negotiations with foreign powers, and a number of commercial agreements were actually arranged, notably with Switzerland, the Netherlands, and Germany in 1937. Here the ground had been prepared in 1928, when New Zealand made an agreement direct with Japan, thus breaking through the previous practice of conducting all such dealings through the Foreign Office. In this case her motives were, as usual, strictly practical: discussions via London would have moved so slowly that her season's butter would have missed the market. However, she justified her action with a phrase which showed that the most conservative Dominion could on occasion use the language of autonomy: the authority under which the agreement was made was 'simply the general sovereign power of New Zealand'. This aspect of the transaction was not much stressed. New Zealand statesmen were more interested in strengthening 'the goodwill which already exists between the people of New Zealand and the people of Japan', and in the confident hope that the latter would acquire a strong liking for butter. However, the principle was now established that New Zealand had the right, which she had fruitlessly demanded sixty years before, to negotiate directly with foreigners. An agreement with Belgium followed in 1933, and page 119the negotiations of 1936 and 1937 showed a renewed appreciation that New Zealand was a part of a world economy in which she might fruitfully play an independent part; provided, of course, that nothing was done to injure her vitally important trade with Britain.

Another aspect of this wider perspective was shown in her relations with the International Labour Office. For some years after the Peace Treaty she played no effective part in the work of the I.L.O. Her whole impulse was towards collaboration with Britain within the Empire, and against independent action at Geneva or elsewhere. Moreover, in the official view 'New Zealand led the world in the matter of labour legislation, and … had nothing to learn from other countries in that direction'. From this it followed that the expense of sending delegates to the I.L.O.'s conference would not be justified by any prospective benefit to New Zealand. Nor did her governments feel any impulse to use the Office as an instrument to encourage the rest of the world to benefit by her example in social legislation. Her technical collaboration was kept at a minimum, and until 1938 she had the distinction of having ratified no conventions at all. However, delegations were sent to the I.L.O. conferences in 1930 and 1935, and with the advent of a Labour Government towards the end of the latter year there was a distinct change in attitude. After 1936 New Zealand took a more active part in the general page 120work of the Office. Her delegations were strengthened, and her Minister of Labour found at Geneva how valuable was the contact provided by the I.L.O. between different countries who shared the same economic problems. However, it was not till 1938 that Parliament ratified a batch of twenty-two conventions which did not require any amendment in the existing law. This step was grudgingly accepted by the Opposition on the ground that, though the direct benefit to New Zealand would be negligible, it might be 'an example to other nations', particularly 'in helping lazy nations to effect reforms'. However, it has not been followed by any serious attempt to deal with those conventions which would require some modification of New Zealand law, and in general it may be said that the New Zealand attitude towards the I.L.O. has been marked by correctness and caution rather than by determination to give a lead towards international co-operation. However, in the work of the I.L.O., as in that of the League itself, she showed a genuine independence of attitude, even where this brought her into open disagreement with official British policy.

It was common knowledge that New Zealand's campaign for collective security was disliked by the British Government. The crowning discomfort of public dissension between two British countries at Geneva was indeed avoided, but there was an obvious contradiction between the avowed policies of Britain page 121and of New Zealand, and plentiful rumours of plain private speech between Englishmen and New Zea landers in the galleries of the Palais des Nations. The main criticism of New Zealand's stand came, however, from within New Zealand itself. Conservative critics were shocked at the mere fact that the Dominion had publicly criticised the mother country. In their view New Zealand should have said her say at the Imperial Conference (as she did) and then remained silent as befitted one so unimportant; for, to them, foreign affairs were a matter of power politics, in which a nation was entitled to a voice in proportion to its might, not to the rightness of its cause. And if this was true even in the heyday of the League, the world's evolution since 1931 seemed to Labour's critics to confirm their view day by day. Collective security had failed, and was therefore wrongly conceived; New Zealand must cling as of old to a powerful and indulgent mother, and cease to advocate a policy to the enforcement of which she would be neither willing nor able to make a substantial contribution.

This clash of opinion, significant as it was in New Zealand's relations with Britain, caused little more than a ripple in public opinion within the Dominion. Though more interested in the world than ever before, she was still absorbed primarily in domestic affairs, and any possibility that an election might be fought partly on the question of New Zealand's conduct at Geneva was destroyed by the acute crisis page 122of 1938. As the actual danger of war visibly approached the Government progressively abandoned its independent point of view, and in May 1938 a Government spokesman went very close to accepting in advance British decision as to peace and war. 'If the Old Country is attacked,' he said, 'we are too. We hate all this war propaganda but, if an attack is made on Great Britain, then we will assist her to the fullest extent possible.'* This statement, which accurately reflected public opinion, marks a turning point in New Zealand's brief public excursion into high politics. Thereafter, whatever New Zealand ministers may have thought of Britain's previous policy, and whatever they may have continued to say to her Government in private, the Dominion's attitude towards foreign affairs was increasingly dominated by the admitted necessity of accepting London's ultimate decision in times of crisis.

The test came with the Czech crisis of September 1938 and revealed that New Zealand opinion and policy remained fundamentally unchanged. There was an immediate danger of war, arising out of a European situation which raised in an acute form the problem of collective security as it affected the British Commonwealth, but the Government made no public statement on the matter. Its view was, apparently, that New Zealand's opinion on the general principles involved had been made abundantly clear both in page 123private and public discussion, but that it would be wrong, at that juncture, for the smallest and most distant Dominion to clamour for an active policy in which she could take comparatively little share. Therefore, no lead was given to public opinion beyond the clear assurance that, if Britain went to war, New Zealand would do her part. And public opinion was content. It so happened that when the European crisis developed New Zealand was involved in a bitterly fought election campaign; politicians, press, and public were only too willing to carry on with that campaign, minding their own business, and leaving decisions of life and death to Britain. There was, indeed, keen appreciation that the situation was critical. The facts of each successive news bulletin were eagerly discussed. But New Zealand was in her traditional way receptive. She waited to be told what had happened, making virtually no effort to influence the decision, or even to form an intelligent public opinion on the issues involved.

Since 1938 the main trend has again been strongly towards imperial co-operation; and, once again, political and sentimental arguments were formidably reinforced by economic necessity. In the nineteen-thirties the economic bond with Britain was closer than ever, and was clearly seen to have serious disadvantages as well as benefits. Schemes for 'orderly marketing' and price stabilisation for example, which culminated in Labour's guaranteed price, were efforts page 124to protect New Zealand from the disastrous effect of fluctuating prices for her exports. However, the main problem arose from the fact that, with rising tariff barriers in the United States of America and elsewhere, New Zealand increasingly depended on the British market at a time when that market threatened to contract; and here all parties were agreed as to New Zealand's policy. If she could find small supplementary markets, well and good; but the essential thing was to keep the British market as wide open as possible. Propaganda might persuade Englishmen to eat more butter, and a rising standard of life enable them to afford it, but the essential thing was to retain British good will, and to treat British interests fairly in the hope of a generous return—in a word, to earn for New Zealand an enduring place within the British economic system by frank and trustful co-operation. In spite of difficulties—for example, exchange depreciation and, later, exchange control—this policy has been honestly followed for many years by successive New Zealand governments of different political complexions. New Zealand has remained a low tariff country for British exporters, and, for her population, a great consumer.

However, if trade bonds were strong during the nineteen-thirties, financial bonds were stronger still. Up to the depression New Zealand was a regular borrower on the London market, and loans helped not only to develop the country, but to finance her page 125brisk imports of British manufactures. During and after the depression overseas borrowing ceased by mutual consent, and New Zealand began gradually to repay some capital. By this time, however, her overseas indebtedness was vast: in 1932 it was almost £160,000,000— more than £100 per head of the population—and it was tacitly assumed that loans as they fell due would be renewed for long periods at fairly low rates of interest. This depended on the further assumption on the part of British investors that New Zealand was a country in which their money would be safe indefinitely. So long as these conditions continued, the size of the overseas debt did not seriously hamper the Dominion's freedom of policy, except that the burden of interest payments became oppressive when the prices of her main exports were low. But if the British investor should lose confidence, his demand that the overseas debt should be promptly repaid would obviously be extremely embarrassing.

This happened in 1938 and 1939. For reasons which need not be discussed in detail here, Labour's domestic policy led to a flight of capital, and so to a financial crisis and exchange control. Control was used, incidentally, to give still further preference to British trade, but confidence was shaken. It happened that a large loan matured early in 1940, and the British financial institutions and private investors who held the stock were not willing to re-lend on the old terms. page 126They virtually demanded their money back. In the end New Zealand was allowed five years in which to pay off the debt: unless, indeed, changes in domestic policy meantime should convince investors that their fears were groundless. Compulsory repayment at such a rate would dislocate New Zealand's trade, and almost certainly defeat some major objects of domestic policy; and the Dominion was faced with the alternative of suffering this penalty—to be intensified each time a loan fell due—or of convincing a suspicious audience in London that it had mended its ways. Thus it was demonstrated that the existence of a huge overseas debt gave London profound influence over New Zealand, an influence which was none the less real because it may have been unconsciously exercised. By simply refusing to re-invest money originally lent decades ago, Englishmen deeply influenced the details of a distant Dominion's domestic situation, and gave a convincing demonstration of the importance of economic as opposed to constitutional power.

In these circumstances it would have been hard for New Zealand to press strongly in 1939 for Dominion autonomy, but there is no suggestion that her loyalty to British leadership needed artificial stimulus. On the contrary, as the crisis deepened her judgment seemed to coincide increasingly with that of the British Government. However, even when British policy was almost certainly distasteful to her leaders she made page 127no public protest, but, in face of the urgent danger of war, acquiesced in what might reasonably be called a British view of imperial relations.

This was a matter both of the methods and aims of foreign policy. For example, it had long been suspected that there was a clear-cut difference between the views held in Britain and in some Dominions as to the 'consultation' which it was agreed must precede the decision of imperial foreign policy. To Dominion critics 'consultation' implied not only the mutual supply of information, but also an opportunity (if not an encouragement) for Dominion views to be expressed before decisions were finalised. On this point the New Zealand radical took the same ground as the traditionalist. To the British Government, however, it appeared that the essence of the matter was information: that in its view so long as Dominion governments knew what was happening and did not protest, imperial honour was satisfied. And in the crisis year of 1939 this was illustrated in a way peculiarly significant for New Zealand. As a South Pacific Dominion she, together with Australia, was deeply concerned with British policy in the Far East. However, negotiations with Japan in June and July 1939 were apparently accompanied, at best, by 'consultation' of the British type. The New Zealand Government was made 'aware' of the negotiations, but the terms of the final 'Tokyo agreement' were communicated to it on the day after public announcement. page 128When the Prime Minister was questioned on the matter in Parliament it became clear that British Commonwealth policy in the Pacific had been decided in the end by Britain alone.

There was no reason to suppose that the New Zealand Government approved of the terms of the 'Tokyo agreement' or of the means by which it was negotiated. There was a ring of distress in the Prime Minister's statement, and it was followed by a somewhat embarrassed debate. Private members of the Government party complained in vehement terms that British policy had jeopardised imperial harmony and international peace, and, in particular, had undermined the security of Australia and New Zealand; and they were in turn denounced by an Opposition which believed at heart that criticism of Britain was clear proof of disloyalty. Cabinet ministers were discreet. They defended their followers against the Opposition's charge of disloyalty, but avoided discussing the merits of British policy in the past. They concentrated instead on the non-controversial statement that New Zealand and Britain were completely at harmony in their defence policy. That, indeed, was the root of the matter. In company with Canada and South Africa, who had led the fight for Dominion autonomy, but with prompter decision and greater unanimity, New Zealand realised that apart from any legal obligation she stood for the continuance of the British system as against the challenge which it page 129seemed likely to meet. Although she might disagree strongly with certain aspects of British policy, such disagreements were as nothing compared with her basic identity of purpose with Britain. Therefore in July 1939 she could accept without open protest a policy decision which in calmer days might have led to plain-spoken criticism, and put her whole strength into co-operation in imperial defence.

By 1939 New Zealand's defence efforts were considerable for so small a country, and steps had been taken to fit them into an Empire scheme. Early in 1939 New Zealand had come into line with other Dominions with the reception of a British High Commissioner to improve the machinery of political co-operation; a step which, it is said, she had previously opposed because it implied a certain independence in herself. In April the Pacific Defence Conference met in Wellington at New Zealand's invitation: it was a body of technical experts from Britain, Australia, and New Zealand charged with the co-ordination of imperial defence in the Pacific. Thus in 1939 to the eye of the expert, if not of the man in the street, New Zealand was appearing once more a Pacific country. Her keen interest in air communications was a further sign of wider perspective; and so was her renewed sympathy with the United States of America. New Zealanders, like other Commonwealth peoples, look to America as a potential champion of democracy, and for them American policy has special page 130importance. Her bonds of sentiment and commerce with the United States are stronger than with any other foreign state; indeed America is scarcely thought of as foreign at all. When New Zealand detaches her eyes from Britain to gaze upon the Pacific, America's friendly bulk looms comfortably large. Indeed, her interest in possible American reactions if trouble should overtake the British Dominions sometimes prompts visiting Americans to think of New Zealand as a would-be hanger-on of the American continent. The inference, born of persistent questioning, is false. New Zealand is only to a small extent Pacific-conscious. Strongly as she is drawn towards America, this impulse is negligible compared with the overwhelming desire (and compulsion) to stand with Britain.

When war came in September 1939 it showed conclusively how closely New Zealand was bound to Europe, and swept away the constitutional speculations and precautions of twenty-five years. During and after the Great War the Dominions had stipulated clearly that they would never again become entangled in war by a policy over which they had no control; next time they would judge the cause and make their own decision. But in 1939 there was no discussion as to whether the critical guarantee to Poland had been given with Dominion consent, or whether the Dominions were legally bound to honour it. The overwhelming fact was that Britain was at war, and page 131in face of that fait accompli they had little choice. New Zealand, for her part, repeated the alacrity of 1914. Once again she was the first to proclaim her 'solidarity and partnership' with Britain. Parliament was in session at the time, but in spite of previously declared policy, the responsibility of decision was not thrown upon it. The message from London was understood to mean that the United Kingdom was at war, and New Zealand associated herself with the mother country by a deliberate act of her own Cabinet. As in the Chanak crisis of 1922, a few minutes' formal deliberation sufficed, and it is perhaps significant that New Zealand was deemed to have been at war from the same moment as the United Kingdom. A few days later Parliament unanimously approved Cabinet's action, and New Zealand launched vigorously into war on the express basis that her man power and economic resources were entirely at Britain's command. Plans prepared beforehand were promptly executed, and in addition it was made a point of pride that every suggestion received from the British Government had been accepted and carried out. 'Both with gratitude for the past and with confidence in the future,' said the Prime Minister, 'we range ourselves without fear beside Britain.'

Such was New Zealand's clear-cut position on the eve of her centennial year. Yet the undercurrent of independence which was part of her national tradition, and which gave her a foreign policy of her own in page 1321936, was by no means dead. No doubt the Government correctly represented the will of the great majority to accept British leadership in all essentials, but there was much discussion as to details, and (as in Britain herself) vocal and determined minorities fought for unpopular policies. The depressions and political crises of the nineteen-thirties had stung New Zealanders, like other peoples, to study and discuss world affairs as never before. They went into the war of 1939 no less promptly than into that of 1914, but with a better understanding of the nature of war and of the problems of peace. Thus when the time comes for New Zealand, with other Dominions, to reassert her nationhood in the council-chamber as well as on the battlefield, the ground will have been prepared in the minds of her citizens for a modest independence in international affairs.

Such would be the logical conclusion to a century of varied history. After the energetic but sometimes unbalanced self-assertion of Vogelism, New Zealand's independence of spirit paradoxically declined, though her own strength and importance in the Empire steadily developed. Her citizens were increasingly preoccupied with making their living in a farming community, and the atmosphere of provincialism became more overpowering with isolation: especially isolation from that part of the world which was not Anglo-Saxon. Consequently the decline of independence was natural even among those colonists who page 133were not driven to imperial loyalty by consciousness of tensions of the post-1870 period: tensions which gradually destroyed that calm world of the early nineteenth century wherein Englishmen felt themselves to enjoy an axiomatic superiority. Thus the trend was towards psychological dependence on Britain, both among those who were conscious of world problems and those who were not. However, this trend reached a climax in the post-war 'mother complex', which helped in turn to provoke outspoken rebellion against British dominance in 1936. Then followed a period of renewed independence which was cut short by the war of 1939, and which may in time produce a better balance: a compromise between Vogelism and the imperial enthusiasm of Massey. As Massey saw, indeed, the permanent basis of New Zealand's relations with the outside world can scarcely be other than close co-operation with the mother country, for history has shaped New Zealanders into a people British in sentiment, tradition, and economic interest. But that people has had honourable contacts in peace and war with other countries and other cultures. Her history has equipped her to live a life of her own as a small but not subservient member of the British Commonwealth.