opposition attacked the Labour Party's more left-wing policies, and accused it of undermining free enterprise and hard work. The Reform Party and the United Party merged to become the National Party, and would be Labour's main rival in future years. However the welfare state system was retained and expanded by successive National and Labour governments until the 1980s. 1930s foreign policy In foreign policy, the Labour Party in power after 1935 disliked the Versailles Treaty of 1919 as too harsh on Germany, opposed militarism and arms build-ups, distrusted the political conservatism of the National Government in Britain, sympathized with the Soviet Union, and increasingly worried about threats from Japan. It denounced Italy's role in Ethiopia and sympathized with the republican forces in the Spanish Civil War. Those policies favoured the left but it also was pro-German. It consistently advocated negotiations with Nazi Germany, signed a trade agreement with it, welcomed the Munich agreement of 1938 regarding the division of Czechoslovakia, discouraged public criticism of the Nazi regime, and pursued a slow rearmament programme. When World War II broke out in September 1939, it recommended to London a negotiated peace with Berlin; however after the fall of France in the spring of 1940, it did support the British war effort militarily and economically. Second World War When war broke out in 1939, New Zealanders saw their proper role as defending their proud place in the British Empire. It contributed some 120,000 troops. They mostly fought in North Africa, Greece/Crete, and Italy, relying on the Royal Navy and later the United States to protect New Zealand from the Japanese forces. Japan had no interest in New Zealand in the first place; it had already over-reached when it invaded New Guinea in 1942. (There were a few highly publicised but ineffective Japanese scouting incursions.) The 3rd New Zealand Division fought in the Solomons in 1943–44, but New Zealand's limited manpower meant 2 Divisions could not be maintained, and it was disbanded and its men returned to civilian life or used to reinforce the 2nd Division in Italy. The armed forces peaked at 157,000 in September 1942; 135,000 served abroad, and 10,100 died. New Zealand, with a population of 1.7 million, including 99,000 Māori, was highly mobilised during the war. The Labour party was in power and promoted unionisation and the welfare state. Agriculture expanded, sending record supplies of meat, butter and wool to