Thirty Years Of American Diplomacy, by Henry White and Allan Nevins, pp.257-8:
This book records a 1910 conversation between Arthur Balfour and Henry White, the United States Ambassador in London.
Balfour:
We are probably fools not to find a reason for declaring war on Germany before she builds too many ships and takes away our trade.
White:
You are a very high-minded man in private life. How can you possibly contemplate anything so politically immoral as provoking a war against a harmless nation which has as good a right to a navy as you have? If you wish to compete with German trade, work harder.
Balfour:
That would mean lowering our standard of living. Perhaps it would be simpler for us to have a war.
White:
I am shocked that you of all men should enunciate such principles.
Balfour:
Is it a question of right or wrong? Maybe it is just a question of keeping our supremacy.
Arthur Balfour was Prime Minister 1902-05 when war against Germany was planned. He formed the Committee of Imperial Defence which oversaw the organisation of the war, and remained a key member of the Committee through 1905-15 while the Liberal Party was in office and while he himself was technically out of power and in Opposition. He became First Lord of the Admiralty in the unelected government of 1915-16, and Foreign Secretary in the next unelected government, in which capacity he issued the Balfour Declaration.
British Diplomatic and Consular Report, 1913 Cd. 7048, pp. 72-73, EXTRACT:
“It may in the long run not avail us to maintain a two-ship power against Germany if we allow Germany to maintain a two-school power against us. The more perfect social organization of the German people, their stronger national consciousness, and, above all, their fuller equipment in school and college for the practical duties of life and citizenship --- these are the more formidable advantages in the secular struggle for survival and supremacy than the mere piling up of mechanical armaments.”
The two-power standard was the British policy of maintaining a number of battleships at least equal to the combined strength of the next two largest navies in the world.
The “two-school threat” described above expresses the fear that mere military power might not be enough to destroy Germany.
They feared that higher levels of German education, social provision, and general civilization might ultimately be too much for British violence to overcome.