in the direction they wished. After the banking crisis of 1931, the whole structure of
international finance with which the Group had been so closely associated disappeared
and, after a brief period of doubt, was replaced by a rapid growth of monopolistic
national capitalism. This was accepted by the Milner Group with hardly a break in stride.
Hichens had been deeply involved in monopolistic heavy industry for a quarter of a
century in 1932. Milner had advocated a system of "national capitalism" with "industrial
self-regulation" behind tariff walls even earlier. Amery and others had accepted much of
this as a method, although they did not necessarily embrace Milner's rather socialistic
goals. As a result, in the period 1931-1933, the Milner Group willingly liquidated
reparations, war debts, and the whole structure of international capitalism, and embraced
protection and cartels instead.
Parallel with their destruction of reparations, and in a much more direct fashion, the
Milner Group destroyed collective security through the League of Nations. The Group
never intended that the League of Nations should be used to achieve collective security.
They never intended that sanctions, either military or economic, should be used to force
any aggressive power to keep the peace or to enforce any political decision which might
be reached by international agreement. This must be understood at the beginning. The
Milner Group never intended that the League should be used as an instrument of
collective security or that sanctions should be used as an instrument by the League.
From the beginning, they expected only two things from the League: (1) that it could
be used as a center for international cooperation in international administration in
nonpolitical matters, and (2) that it could be used as a center for consultation in
political matters. In regard to the first point, the Group regarded the League as a center
for such activities as those previously exercised through the International Postal Union.
In all such activities as this, each state would retain full sovereignty and would cooperate
only on a completely voluntary basis in fields of social importance. In regard to the
second point (political questions), no member of the Group had any intention of any state
yielding any sliver of its full sovereignty to the League. The League was merely an
agreement, like any treaty, by which each state bound itself to confer together in a crisis
and not make war within three months of the submission of the question to consultation.
The whole purpose of the League was to delay action in a crisis by requiring this period
for consultation. There was no restriction on action after the three months. There was
some doubt, within the Group, as to whether sanctions could be used to compel a state to
observe the three months' delay. Most of the members of the Group said "no" to this
question. A few said that economic sanctions could be used. Robert Cecil, at the
beginning, at least, felt that political sanctions might be used to compel a state to keep the
peace for the three months, but by 1922 every member of the Group had abandoned both
political and economic sanctions for enforcing the three months' delay. There never was
within the Group any intention at any time to use sanctions for any other purpose, such as
keeping peace after the three-month period.
This, then, was the point of view of the Milner Group in 1919, as in 1939.
Unfortunately, in the process of drawing up the Covenant of the League in 1919, certain
phrases or implications were introduced into the document, under pressure from France,
from Woodrow Wilson, and from other groups in Britain, which could be taken to
indicate that the League might have been intended to be used as a real instrument of
collective security, that it might have involved some minute limitation of state
sovereignty, that sanctions might under certain circumstances be used to protect the
peace. As soon as these implications became clear, the Group's ardor for the League
began to evaporate. when the United States refused to join the League, this dwindling
ardor turned to hatred. Nevertheless, the Group did not abandon the League at this point.
On the contrary, they tightened their grip on it—in order to prevent any "foolish" persons
from using the vague implications of the Covenant in an effort to make the League an
instrument of collective security. The Group were determined that if any such effort as
this were made, they would prevent it and, if necessary, destroy the League to prevent it.