American World Policies
Walter Edward Weyl




Walter E. Weyl

American World Policies





PART I

OUR IDEALISTIC PAST

AMERICAN WORLD POLICIES





CHAPTER I

AMERICA AMONG THE NATIONS


The Great War has thrown America back upon itself. It has come as a test and challenge to all our theories. Suddenly, yet subtly, it has shaken our optimism and undermined our faith in the peaceful progress of humanity. Our isolation is gone, and with it our sense of security and self-direction. Americans, who a few days ago would have dared to abolish army and navy as a supreme earnest of good faith, reluctantly agree to arm. "Self-defence," they now say, "comes before progress. We must lay aside our hopes of a world at peace and must guard our gates."

Doubtless there is some exaggeration in our change of mood. Men speak as though a miracle had swept away the Atlantic Ocean, leaving us stranded on Europe's western shore. Fortunately the Ocean, always America's ally, still lies there, narrowed and curbed, yet three thousand miles of storm-swept water. Physically and morally, however, our isolation has dwindled. Dreadnaughts, submarines and airships can now reach us and our commerce, industry and national ambitions are interwoven with those of Europe. We shall never again stand aloof from the world.

To Americans this change has come so suddenly, though it has been long preparing, that we fail to visualise the new situation. We glibly repeat that our isolation is gone, but do not ask ourselves what is the nature of the bond that has ended our isolation. Is it amity or enmity? Are we to become one of a dozen clutching, struggling, fighting nations, seeking to destroy each other, or are we to contribute to a solution of the problems that now divide nations into warring groups? Though our isolation is gone, we still preserve a latitude of action. We may choose between two foreign policies, between Nationalistic Imperialism and Internationalism. We may elect to fight for our share of the world's spoils or to labour, and, if necessary, to fight for a world peace and for just international relations, upon which alone a permanent peace can be based.

Such a choice involves for Americans the main trend of our civilisation; for Europe it is hardly less vital. Our influence upon Europe, like hers upon us, has grown with the shrinking of the earth's surface. Our bulk, our resources and our remnant of inaccessibility give us a weight in world affairs far in excess of our military power. We are advancing in population, wealth and general education, and our future progress in these directions is likely to be more rapid than that of Western Europe. Moreover we are the only strong nation not tied up in existing international enmities. Our hands are unbound. How we shall act, therefore, whether we shall add to the complications of Europe or aid in disentangling them, is a world as well as a national problem.

In the main such national determinations are dependent upon great economic forces, acting upon the nation from within and without. These economic forces, however, do not work upon stones but upon those loose bundles of instincts, reactions, ideals and prejudices that we call men. We need not dig deep into American history to uncover the human elements that will influence our decision. On the surface of our life appear two strong tendencies pulling in opposite directions.

It is easier to describe than to define these tendencies. The first we might perhaps call pacifism, liberalism, humanitarianism, democracy, though none of these words exactly defines the generous, somewhat ineffectual, peace ideal, which has grown up in a democratic people with no hostile neighbours. At this moment by the light of the European camp-fires we are likely to belittle this easy do-nothing idealism. We find our idealists prosaic. They are not gaunt fanatics consumed by their own passion, but hard-working, self-respecting, religiously inclined men, asking good prices and high wages, eating good food, wearing good clothes and perhaps running a Ford automobile. To some of these meliorists, Europe seems almost as distant as China, but towards the peoples of both places they preserve a vague and benevolent missionary attitude. They want peace with Europe and peace for Europe, and would even be willing to pay for it, as they pay for relief for Belgium and Martinique. There is little passion in this good-will but there is even less hypocrisy. One may ridicule this cornfed, tepid idealism, but it is none the less the raw material out of which great national purposes are formed. The present desire of Americans for a world peace is no vaguer or more ineffectual than was the seemingly faint sense of the wickedness of slavery, as it existed in our Northern States in the days of the Missouri Compromise. Yet out of that undirected, crude and luke-warm emotion, there burst forth within a generation the white-hot flame, which consumed the detested institution and freed the millions of Negro slaves.

But not all Americans are idealists even of this commonplace sort. In our ultra-keen capitalistic competition we have evolved an American of different type. Self-centred, speculative, narrow, measuring success by the dollars gained and spent, this individualist has a short way with idealisms and larger ends. To him our involuntary rapprochement with Europe is an opportunity not for service but for gain. War is good or bad as it is profitable or the reverse. He is a realist, as is the mole, attached to the earth and not worrying about the skies. His ideal is that of a selfish nation dominated by selfish, social classes.

Here then we have the two Americanisms, both of them native and redolent of the soil, both vital and growing. Both have appeared in many of our national controversies, in the Philippine question, in Porto Rico, in our relations with Mexico. The one is liberal, democratic, often visionary, though confident because many of its visions have come true; the other is concrete, short-sighted, intense but with a low moral sensibility. Each appeals to a patriotism formed in the image of the patriot.

It is upon this divided America that there comes the sense of the impinging of Europe. These men of two opposed types (with innumerable intermediate variations) suddenly perceive that the great war is being fought not only near our shores but even within our borders. They dimly perceive that the war is but an incident in a greater, though less spectacular contest, that it is in reality a phase of a long drawn-out economic struggle in which we too have blindly played our part. To both groups, to all Americans, the war comes close. It is being fought with motives like our motives and ideals like our ideals. It is a conflict which proves to us that international peace is still very far from attainment. War on a scale never before known: war—deliberate, organised, scientific—fought by combatants and noncombatants alike, reveals itself as one of the central facts of our modern life, a fact not to be ignored or preached or argued away, a fact which for us on this side of the ocean, whatever our instincts and our philosophies, has its deep and permanent significance. Our changed relation to this central fact of war constitutes one of the gravest problems that we face to-day. Growing up in a peaceful environment we had imbibed the idea that war was a thing alien to us, monarchial, European. We had come to hold that a nation could avoid war by not desiring it, by not preparing for it, by minding its own business. We believed that what share in the world we had and wanted was what every reasonable nation would willingly concede us, and if certain powers proved refractory and unreasonable—a most improbable contingency—we could always send forth our millions of minute men, armed with patriotism and fowling-pieces. With European conflicts we had no concern; we might deplore the senseless brutality of such wars, but need not take part in their conduct or in their prevention. In due course Europe would learn from America the lessons of republicanism, federalism and international justice and the happiness and wisdom of an unarmed peace. Ourselves unarmed, we could peacefully wrest the weapons from Europe's hand.

The sheer, unthinking optimism of this earlier American attitude ended abruptly on the outbreak of the present war. It is not surprising that our first reaction towards this war, after its full sweep and destructiveness were visible, was one of fear. If a peaceful nation like Belgium could suddenly be overrun and destroyed, it behooved us also to place ourselves on guard, to be ready with men and ships to repel a similarly wanton attack. The result was a demand for preparedness, an instinctive demand, not based on any definite conception of a national policy, but intended merely to meet a possible, not clearly foreseen, contingency. The whole preparedness controversy revealed this rootlessness. It was in part at least an acrid discussion between careless optimists and unreasonable scare-mongers, between men who held positions no longer tenable and others who were moving to positions which they could not locate. Our ideas were in flux. Whether we should arm, against whom we should arm, how we should arm, was decided by the impact of prejudices and shadowy fears against an obstinate and optimistic credulity.

Nothing was more significant of the externality of these debates than the fact that they seemed to ignore everything that we had cared about before. The case for armament was presented not as a continuation of earlier national policies but as a sort of historical interlude. Past interests were forgotten in the insistence upon the immediate. Until the war broke in upon us we had been groping, both in foreign and domestic policies, towards certain forms of national expression; arbitration, international justice, democracy, social reform. Throughout a century, we had believed that we had blundered towards these goals, and that our history revealed an aspiration approaching fulfilment. We had settled a continent, built an ordered society, and amid a mass of self-created entanglements, were striving to erect a new civilisation upon the basis of a changed economic life. Now it was assumed that all this stubbornly contested progress was forever ended by the conflict engulfing the world.

This whole idealistic phase of American life was disparaged by our sudden ultra-patriots. These men, with a perhaps unconscious bias, opposed their brand new martial idealism to what they falsely believed was a purely materialistic pacifism. Actually both advocates and opponents of increased armaments were contending under the stress of a new and bewildering emotion. For decades we had concerned ourselves with our own affairs, undisturbed by events which convulsed Europe. But the present war, because of its magnitude and nearness, had set our nerves jangling, excited us morbidly, dulled us to horror and made us oversensitive to dread. We read of slaughter, maiming, rape and translated the facts of Belgium and Servia into imaginary atrocities committed against ourselves. We wanted to be "doing something." Not that we wished war, but rather the chance to rank high according to the standards in vogue at the hour. While hating the war, we had insensibly imbibed the mental quality of the men who were fighting. We were tending to think as though all future history were to be one continuing cataclysm.

For the moment, like the rest of the world, we were hypnotised. Upon our minds a crude picture had been stamped. We were more conscious of peril than before the war, though the peril was now less. Our immediate danger from invasion was smaller than it had been in June, 1914; yet while we were perhaps foolishly unafraid in 1914, in 1916 we trembled hypnotically.

It was to this state of the American mind that all sorts of appeals were made. Those who wanted universal conscription and the greatest navy in the world argued not only from dread of invaders but from the necessity of a united nation. They wanted "Americanism," pure, simple, undiluted, straight. There was to be no hyphen, no cleavage between racial stocks, no line between sections or social classes. America was to be racially, linguistically, sectionally one.

It was an ideal, good or bad, according to its interpretation. A more definitely integrated America, with a concrete forward-looking internal and foreign policy, could aid disinterestedly in untying the European tangle. In the main, however, the demand for Americanism took on an aggressive, jingoistic, red-white-and-blue tinge. Out of it arose an exaggerated change of mood toward the "hyphenate," the American of foreign, and especially German, lineage. Newspapers teemed with attacks upon this man of divided allegiance.

In other ways our agitation for a United America took a reactionary shape. Though a pacific nation, we experienced a sudden revulsion against pacifism and Hague tribunals, as though it were the pacifists who had brought on the war. Contempt was expressed for our industrialism, our many-tongued democracy, our policy of diplomatic independence. Those most opposed to Prussianism, as it has been defined, were most stubbornly Prussian in their proposals. We heard praises of the supreme education of the German barracks, and a clamour arose for universal service, not primarily industrial or educational but military in character. A decaying patriotism of Americans was deplored quite in the manner of Bernhardi. More than ever there was talk of national honour, prestige, the rights of America. Our former attitude of abstention from European disputes was called "provincial," and we were urged to fight for all manner of reasons and causes. Even though we cravenly desired peace, we were to have no choice. An impoverished Germany, beaten to her knees, was to pay her indemnity by landing an army in New York and holding that city for ransom. Around such futilities did many American minds play.

All this appeal would have been more convincing had it not been most insistently urged by influential financial groups. The extent of certain financial interests in large armaments, in a spirited foreign policy and in other widely advertised new doctrines, was obvious. The war had built up a vast armament industry, war stocks had been widely distributed, and upon the advent of peace these properties would shrink in value unless America made purchases. More important was the complex of financial interests, likely to be created in Latin America and elsewhere. Speculators were dreaming of great foreign investments for American capital. We were to become a creditor nation, an imperialistic power, exploiting the backward countries of the globe. We were to participate in international loans, more or less forced, and to make money wherever the flag flew. For such a policy there was needed the backing of a patriotic, united, disciplined and armed nation, and to secure such arms, any excuse would suffice.

At the most, of course, these financial adventurers were merely leaders in a movement that arose out of the peculiar conditions of the moment. The roots of our sudden desire for armament and for an aggressive foreign policy ran far deeper than the interests of any particular financial group. A sense that American ideals were in peril of being destroyed by a new barbarism impelled us to new efforts. We dimly perceived that we must solve new problems, accept new responsibilities, and acquit ourselves worthily in new crises.

The most obvious result of this campaign for preparedness was a largely increased expenditure for armies and navies. Its deeper significance, however, lay in the fact that it marked the end of our former theory that war can be ended by precept and example and that no nation need fear war or prepare for war so long as its intentions are good. Hereafter the size and character of our national armament was to be determined in relation to the possibility of war with Europe and of war in Europe. The campaign for military preparation is not ended. It will not end until some relation is established between our new armament and the national policy which that armament is to serve.

So long as these preparedness debates lasted we believed that the fundamental cleavage in American sentiment was between those who wished to arm and those who did not. Yet the proposal to increase the army and navy was defended by men of varying temperaments and opinions, by liberals and conservatives, by workmen and capitalists, by members of peace societies and representatives of the Navy League. As the first stage of mere instinctive arming passes, however, it suddenly appears as though the true cleavage in American thought and feeling runs perpendicular to the division between those who favour and those who oppose armament. The real issue is the purpose to which the arms are to be put. We may use our armed strength to secure concessions in China or Mexico, to "punish" small nations, to enter the balance of power of Europe or to aid in the promotion of international peace. We may use our strength wisely or unwisely, for good or for ill. We began to arm before we knew for what we were arming, before we had a national policy, before we knew what we wanted or how to get it. Our problem to-day is to determine upon that policy, to create out of the constituent elements forming American public opinion a national policy, determined by our situation and needs, limited by our power, and in conformity with our ideals. It is the problem of adjusting American policy to the central fact of international conflict and war.

As we approach this problem we discover that the two great elements in our population tend to pull in contrary directions. In the question of defence the one instinctively follows the lead of European nations, piling up armies and navies and attempting to make us the most formidable power in the world; the second seeks by understandings with other nations to prevent disagreements and to avert wars. The first group emphasises American rights on "land and sea," the property rights of Americans, our financial interests in backward countries, and the military force necessary to secure our share; the second thinks of establishing international relations in which such rights may be secured to all nations without the constant threat of force. Both of these elements are national in the sense that they desire to preserve the country's interest, but while the first group envisages such interest as separate and distinct from others, to be defended for itself alone as a lawyer defends his client, the other sees the national interest in relation to the interests of other nations and seeks to secure international arrangements by which conflicting claims can be adjusted. The first element lays stress upon the legalistic attitude, upon our honour, our rights, our property; the second is less jingoistic, less aggressive, less jealous in honour.

Which of these two elements in our population will secure the ascendency and dictate our foreign policy, or which will contribute more largely to the decision, will be determined chiefly by the course of our internal evolution and especially by our economic development. Whether we are to go into international affairs to get all we can—concessions, monopolies, profits—will depend upon how great is the internal economic strain pressing us outward, upon whether our conditions are such that the gains from a selfish national aggrandisement will outweigh the large, slow gains of international co-operation. Ideals will also count, as will tradition and precedent. Even chance enters into the decision. If, for example, by some change in the internal affairs of Germany we are thrown into an alliance with England, France and Russia, a direction will be given to our international policy which it may take years to change. The accident which found Admiral Dewey in Asiatic waters on a certain day in April, 1898, has not been without its influence upon the ensuing foreign policy of the United States.

For those who wish to use our armed forces to secure special advantages (trade, monopolies, fields for investment), the road is broad and clearly marked. They have only to do what other aggressive and imperialistic nations have done—prepare the means of fighting and threaten to fight either alone or with allies whenever a favouring opportunity offers. But for those of us who desire to make America an agency in the creation of international peace the problem is infinitely more difficult. Peace and internationalism cannot be secured by fervent wishes or piety but only by persistent effort and measureless patience. That for which men have sought in vain during so many centuries will not fall like ripe fruit into our laps.

Towards this goal of internationalism all that is best in America aspires. The American tradition points towards internationalism. Our early settlers, as also many of our later immigrants, came to these shores to escape political and religious warfare, and brought with them a broad humanitarian ideal, an ideal of peace, internationalism, freedom and equality. They also brought an antipathy towards those monarchical and aristocratic institutions, with which in America we still associate conceptions of imperialism and war. The simplicity and inherent equality of our frontier life, its self-government and its local independence, tended to reinforce our leaning towards a peaceful internationalism. Our large spaces, our ease of movement, our freedom from the militaristic and excessively nationalistic traditions of the European Continent influenced us in a like direction, as did also the merging of many peoples into one nation. We were not disillusioned by any conflict with harder-pressed nations, desiring what we had or having what we desired. We believed vaguely in an inevitable beneficent internationalism, which would bring all nations into harmony and banish war from the world.

Actually our pacifists and internationalists have accomplished little, if anything, towards a realisation of this ideal. What has hampered them, apart from the overwhelming difficulty of the problem, has been the fact that they did not realise how distant was the goal towards which they were marching. Their approach to the problem was not realistic. They conceived of the World as a group of nations in all fundamentals like America and of peace as a process by which these other nations would approximate to the United States. The great solvents of war were democracy, education and industrialism. Democracy would take from the ruling classes the right to declare wars; education would destroy in the people the last vestiges of bellicosity and international prejudice, while industrialism would in the end overcome militarism, and turn battleships and howitzers into steam-ploughs and electric cranes. The triumphant progress throughout the world of democracy, education and industrialism would speedily bring about peace and a firm internationalism.

Unfortunately the problem of imperialism and war is far more intricate than this popular theory assumes. All these forces tend perhaps in the general direction of peace but they do not bring about peace automatically and in many cases actually intensify and augment the impulse towards war. Our present age of advancing democracy, education and industrialism has been, above all other periods, the age of imperialism, of exaggerated nationalism and of colonial wars. Democratic peoples have not been cured of nationalistic ambition, and education, in many countries at least, has aided in the creation of an imperialistic and militaristic spirit. Even our unguided industrialism has not ended wars or brought their end perceptibly nearer. There is no easy road to internationalism and peace, and those who strive for these ends without understanding the genesis and deep lying causes of war are striving in vain.

If in America therefore, we are to contribute to the promotion of internationalism and peace, we must recognise that war is not a mere accident or vagary but a living thing growing out of the deepest roots of our economic life. It is not caused alone by human unreason, by the pride of individuals, the greed of social classes, the prejudices of races and nationalities, but is closely intertwined with those economic ideals upon which the best as well as the worst in our civilisation is reared. We had believed that industrialism and militarism were mutually opposed and that the factory would automatically destroy the army. To-day we see how each of these has entered into the spirit of the other and how each helps the other. The army is industrialised and the national industry is put upon a military, fighting basis. The same forces that impel a nation to develop its trade, increase its output, improve its industrial technique, also impel it to raise large armies and to fight for the things for which men work. To divorce economic ambition from the national aggression that leads to war will not be easy. It is a sobering task which faces those who wish to use America's influence in the cause of peace.

Whatever our course of action, however, whether we strive for an American imperialism or for internationalism, one thing is certain: it cannot be instinctive, fluctuating, undirected. We cannot revolutionise our international relations with each new administration or with each change of the moon. Nor can we stay at home and, ignorant of the causes of war, content ourselves with a long-distance preaching of peace to the menaced nations of Europe. Each of the two courses open to us involves self-direction, valour and strength. If we are to enter upon a struggle for place, power and profits, we must prepare for a dangerous contest: if we are to labour for a new international harmony, for peace and good-will and the delicate adjustments without which these are but words, we shall also need courage—and infinite patience. Without knowledge we shall accomplish nothing. To enter upon an international career without a sense of the conditions underlying peace and war, is to walk in darkness along a dangerous path.




CHAPTER II

THE SKELETON OF WAR


To ascribe world events to the action of a single individual is a naïve yet persistent manner of thought. All over Europe men blamed the war upon a wicked Kaiser, a swaggering, immature Crown Prince, a weak-fisted Von Berchtold, a sinister Tisza, a childish Poincaré, an unscrupulous Sir Edward Grey, an abysmally astute Sasonof. We in America blamed everything on Von Tirpitz and the irrepressible Reventlow. In all countries, millions of men drifted helplessly toward a war, which they believed was due to the evil machinations of a man.

So long as the belief holds that one man can set the world on fire, there can be no reasonable theory of war or peace. It is a conception which makes world destiny a plaything, unmotived in any large sense, accidental and incalculable. On the other hand, those who regard war as merely irrational, a general human idiocy, are equally far from any true approach to the problem. We are being deluged to-day with books and newspaper articles describing war as a reversion of mankind to a lower type, a betrayal of reason, a futile, revolting struggle, creating no rights, settling no problems and serving no useful purpose except, in Lord Salisbury's phrase, "to teach people geography." Let us be rational and adult, cry these authors, adjuring an insane world to return to its sanity.

No wonder that there is prejudice against this particular variety of abstract pacifism. It is a negative doctrine, anæmic and thin-haired, with a touch of gentle intolerance and a patient disregard of facts. It does not recognise the real motives to war, upon which alone a theory of peace may be based. It defeats itself because ultra-rationalistic. For if war, though irrational, has always been, would it not follow that man himself is irrational, that the fighting instinct is deeper than reason, and that to-morrow, as to-day, men will fight for the joy of killing? If this were true, pacifism might as well resign. In truth, this interpretation of war as a mere expression of man's fighting instincts is no more adequate than is the personal devil theory. War has outgrown the fighting instinct. It has become deliberate, businesslike, scientific. It demands sacrifices from those to whom fighting is an abomination. How many red-blooded warriors could the German Emperor or the French President have enrolled, had there been no appeal to national interest, duty, justice, indignation? War is won to-day by peace-loving men, who abhor the arms in their hands.

The closer we study its motives, incentives and origins, the more deeply do we find the elements of this problem imbedded in the very foundations of national or group life. War depends upon growth in population, emigration, the use of natural resources, agricultural progress, trade development, distribution of wealth, taxation. It is never unrelated to the economic web in which the people live their lives; it is seldom unaffected by the necessity of expanding and the opposition of neighbours, the desire for bread and the longing for luxuries. War and peace are functions of the national life, steps in national progress or retrogression. Peace and war are two paths leading often in the same general direction, and whether we may take one path or must take the other is often determined for us long before we reach this parting of the ways.

At first glance this economic or business side of war is obscured. We find tribes and nations fighting for women and heads and scalps, to please the gods, to destroy sorcerers, to slay heretics, to show prowess, and for other reasons which seem equally remote from an economic motive. A nation will go to war "to save its face," or to annihilate the "hereditary enemy," as well as to improve its position in the world. Yet these diverse human motives are related to, though not fully absorbed in, the omnipresent economic motive. The "hereditary enemy" usually is no other than the tribe or nation that blocks our way; the "gods" enjoin war against neighbours who occupy the lands we need or can furnish us tribute; the women, whom we capture, are tame and pleasant beasts of burden, who help to swell our numbers. As for pride and tribal vanity, which so often precipitate war, these are a powerful social bond, which by holding the tribe together permits it to conquer the things it needs. A war for prestige is often a war for economic gain once removed. There remains a residue of martial emotion, not so closely united with the desire for economic gain, but all these derivative motives do not prevent the economic factor from remaining preponderant. Remove the economic factors leading to war, give men more than enough, and the chief incentive to war disappears.

The modern historical trend has been towards a fuller recognition of the influence of this potent, though often disguised, motive to war. Historians are recognising that the mainspring of social action is not an emperor's dream or soldier's ambition, but the demand of vast populations for food, clothing and shelter, then for better food, clothing and shelter, and finally for the rights, privileges and institutions which will make such economic progress assured. Ancient war, which seemed so empty and causeless, is now revealed as a half-conscious effort of human societies to adjust themselves to changing economic conditions. It is a struggle for bread. Indeed, so complete has been this change in our theories that we often exaggerate this economic influence, and speak as though no emotion save hunger impelled humanity. But such exclusion of other motives is not necessary to an economic interpretation. We can emphasise the influence of economic desires, which modern Americans and Germans share with ancient Greeks and Babylonians, while still admitting the influence of other factors. Race, creed, language, geographical position, increase national friendship or animosity. While these factors influence wars, however, they are less universal, if not less potent than is the economic motive.

The significance of this economic motive to war can hardly be overstated. If wars are in the main due to fundamental, economic conflicts, then we cannot end or limit war unless we discover some alternate way to compose such economic differences. We cannot hope that the human race will stop wanting things. Men have never lived like the lilies of the field, nor wished to live so. According to our every-day morality, wanting and getting are ethical and wise, and not-wanting is unethical and decivilising. Our whole intricate, complex civilisation depends upon the physical well-being and the economic ambition of our populations, and morally, as well as physically, a beggared nation tends to decline. We may trace this degeneration of impoverished groups in some of our mountainous districts, where communities, shut off from the main productive energies of the nation, brutalise and decay. All the conditions of our life impel nations, like individuals, to advance economically, to fructify labour, to gain. If, however, the nation in its struggle for new wealth clashes with other nations, intent also upon gain, if these mobilised, economic ambitions necessarily lead to destructive wars, then we must cease declaiming against war's immorality, and seek instead to discover whether economic readjustments cannot circumscribe or even prevent wars.

To a modern business man or to a city workman this theory of the economic cause of wars is not unsatisfactory. He may quite properly introduce more idealistic elements, a desire for independence, a love of conquest, the influence of personal prejudices, dynastic affiliations, racial antagonism and religious hatreds, but in the end he will apply to this business of war the same canons of judgment that he applies to his own business. "Whom does it pay? What is 'in it' for the nations or for classes or individuals within the nations?" And if you tell him that in the present war Servian hatred was intensified because Austria discriminated against Servian pigs, or that Germany was embittered because of Russian tariffs and French colonial policies, if you speak to him in these economic terms, you are immediately intelligible. Economic motive is one of the obvious facts of life.

It is the transcendentalists who interpret war in more idealistic terms. In every country, but especially in Germany, there is a whole school of historical and pseudo-historical romanticists, who defend war by elevating it high above the reach of reason. You cannot shake the convictions of such writers by an account of war atrocities, of slaughter, pillage, rape, mutilations and the spitting of infants upon lances, just as you cannot deter murderers by the sight of public executions. All these horrors are but a part of war's terrible fascination. "In war," writes the late Professor J. A. Cramb, one of the most eloquent of these war mystics, "man values the power which it affords to life of rising above life, the power which the spirit of man possesses to pursue the ideal." There is, and can be, in his view, no reason for war; war transcends reason. In spite of its unreason, war, which has always governed the world, always ruled the lives of men, always uplifted the strong and deposed the weak, will remain beautifully terrible, immortally young. As in ancient days, in India, Babylon, Persia, China, Hellas and Rome, so to-day, men will choose "to die greatly and with a glory that will surpass the glories of the past." Men are always greater than the earthly considerations that seem to guide their lives. As patriotism ruled the hosts of Rome and Carthage, as the ideal of empire drove forth the valorous Englishmen who conquered India, so to-day, to-morrow and until the end of time high and noble ideas, far above the comprehension of mere rationalists, will impel men to war, "to die greatly."

It may seem importunate to reason with men upon a subject which they include among the mysteries, beyond reason. Yet if we analyse the instances, which Professor Cramb and others cite of wars waged for great ideal purposes, we stumble incontinently upon stark economic motives. Carthage and Rome did not fight for glory but for food. The prize was the fertile wheat fields of Sicily. There was nothing transcendental in the wars between Athens and Sparta, but a naked conflict for commerce and exploitative dominion. As for the British conquest of India, the "ideal of empire" was perfectly translatable into a very acute desire for trade.

We shall make little progress unless we understand this business or economic side of war, for to see war truly we must see it naked. All its romanticism is but the gold lace upon the dress uniform. The idealism of the individual is a mere derivative of those crude appetites of the mass that drive nations into the conflict. Wherever we open the book of history, and read of marching and counter-marching, of slaughter and rapine, we discover that the tribes, clans, cities or nations engaged in these bloody conflicts were not fighting for nothing, whatever they themselves may have believed, but were impelled in the main by the hope of securing economic goods—food, lands, slaves, trade, money.

It is a wide digression from the immediate problems of our closely knit world of to-day to the blind, animal instincts that ruled the destinies of endless successions of hunting tribes, exterminating each other in the savage forest. Yet among hunting tribes, at all times, the raw conflict of economic motive, which we find more decently garbed in modern days, appears crude and stark. To kill or starve is the eternal choice. Since population increases faster than food, war becomes inevitable, for the tribe that hunts on our land, and eats our food, is our hereditary enemy. To pastoral nations, war is equally necessary, unless babies and old people are to be ruthlessly sacrificed. To fill new mouths larger flocks are necessary, to feed larger flocks new pastures are required; and there is only one way to obtain fresh pastures. There comes a period of drought, and the hunger-maddened nation, accompanied by its flocks, hurls itself suddenly upon feebler agricultural peoples, destroying empires and founding them. These are the great Völkerwanderungen, the restless migrations of mobile pastoral nations in search of food. It is the eternal bloody quest.

Nor are agricultural populations immune. Not only must they defend their patches of cultivated land, but, as numbers increase, must strike out for new lands. When the growing population makes conditions intolerable, youths are chosen, perhaps by religious rites, to adventure, sword in hand, and carve out new territory or die fighting. There are always more than there is place for, and it is always possible for a young Fortinbras to shark up "a list of lawless resolutes for food and diet, to some enterprise that hath a stomach in 't." All the interminable battling of the early Middle Ages reveals this effort of fecund agricultural populations to solve the problem of over-breeding by slaughter.

Even the Crusades partake of this economic character. Among the Crusaders were exalted souls, who wished to rescue their Lord's sepulchre, but there were many more who dreamed of free lands, gold and silver, and the beautiful women of the Orient. The religious motive was present; it was strong and intolerant, though it did not in the later Crusades prevent Christians from attacking Christians. At bottom, however, certain strong economic factors forced on the struggle. There had been famine in Lorraine and pestilence from Flanders to Bohemia, and all the discontent, hunger and ambition of western Europe answered to Urbano's call. "A stream of emigration set towards the East, such as would in modern times flow towards a newly discovered gold-field—a stream carrying in its turbid waters much refuse, tramps and bankrupts, camp-followers and hucksters, fugitive monks and escaped villains, and marked by the same motley grouping, the same fever of life, the same alternations of affluence and beggary, which mark the rush for a gold-field to-day."[1 - Ernest Barker. Crusades. Encyclopedia Britannica, Eleventh Edition, Vol. VII, p. 526.] Not until it was seen that they no longer paid did the Crusades end; not heavenly but earthly motives inspired most of these soldiers of Christ. It was business, the business of a crudely organised, over-populated, agricultural Europe.

Even with the development of commerce, the motive does not change in character, though its form becomes different. All through history we find maritime cities and states fighting for the control of trade routes, the exploitation of markets and peoples, the right to sell goods and keep competitors from selling. Athens, Venice, Genoa, Pisa, Florence, Holland, England—it is all the same story. Undoubtedly, with the development of commerce, wealth takes a new form. Land is no longer the sole wealth, and successful warriors need no longer be paid in land and live off the land, as they are forced to do in every feudal society. A money economy, a conversion of values into money, changes the technique of war by creating professional mercenary armies. But the business goes on as before. Rival groups fight for a monopoly of trade as they once fought for land. There is still not enough to go around, and no way of deciding between rival claimants except by the arbitrament of war.

Perhaps it will be objected that an analysis of war such as this leaves us merely with the dead body of facts while killing the soul of truth. Surely, it may be urged, war is more than a sordid calculation; a Roland or Bayard does not weigh his danger against booty. Of course that is so. Economic motive is only the skeleton of war; the flesh and skin are of a totally different texture. Idealism, nobility, heroism exist in war, and are no less sincere because based upon the gross facts of economic necessity and desire. Without such idealism, manufactured or evolved, you can no more win wars, especially in these latter days, than without ammunition. Idealism is a weapon with which we kill our enemies. Yet if we read our history rightly, we shall find less of this luminous nobility among warriors than our annalists pretend. The Greeks of the Trojan War were not patriots but free-booters. Those great English sailors, Drake, Morgan and the rest, who ravaged the Caribbean and smashed the Spanish sea-power, were pirates, unashamed of their piracy. As for the heroic warriors of the Scotch border, would they not to-day be jailed as cattle-thieves? Look where you will, at the great wars and at the blood-tracked colonising movements of history, and always you will find two kinds of men: the stone-blind idealist, and the crass, open-eyed, fleshly man. One fights for ideals, the other for something else worth fighting for. Both, however, are in reality impelled by economic motive, working upon them either directly and consciously, or transmuted into ideals through the medium of a people's thought.

Nor does this fighting for things, to be obtained only by fighting, involve moral turpitude. Nothing could be more grotesque than the moralistic tone in which we industrious moderns lecture the ancient fighting peoples. They did what we do, gained the things they wanted in the only way they could. Men will fight or work rather than starve, and whether they fight or work depends upon which, in the given circumstances, is the feasible mode of accumulation. Perhaps these peoples loved fighting and praised fighting more than we do. But as fighting was their métier and the measure of their success, their minds, like their muscles, became habituated, and their morality discovered virtue to be the thing at which the moralists were adept. Nothing can be wrong that is necessary to survival. Warfare is not immoral until there is an alternative.

Such an alternative might easily have arisen with the vast impetus given to accumulation by the discovery of America and of the new route to the East. But these events not only did not end but actually intensified war, while bringing out more sharply its preponderatingly economic character. For three generations Europe was enmeshed in the Italian wars, in which great rival nations sought to control Italian wealth and the dominion of the Mediterranean. There followed the so-called religious wars, in which Sweden played for control of the Baltic, Holland for the East Indian colonies, and England for trade supremacy, while Catholic France, to strengthen her position at the expense of Austria, came to the aid of Protestant Germany. For another century, from the Peace of Westphalia in 1648 to the Peace of Paris in 1763, there was a succession of commercial wars, in which England wrested from Holland and then from France the mastery of the sea as well as the control of Asia and America. During all this period the rising commercial classes of England were brutally "upon the make." Markets were gained in America and valuable commercial rights obtained from Portugal, while in the famous contract, known as the "Assiento," English merchants secured from Spain the lucrative privilege of shipping one hundred and forty-four thousand negro slaves to the Spanish colonies of America. Of such was the texture of the complex European diplomacy that held the world in war.

In all these conflicts there was precious little idealism. The astute councillors of Elizabeth, of James, of Louis XIV, did not waste their august sovereign's time upon discourses concerning Britain's honour and the grandeur of France, but talked trade, privileges, monopolies, colonies to be exploited, money to be made. So too the Napoleonic Wars, those great conflicts between democracy and absolutism, reveal themselves as a continuation of the commercial wars of the eighteenth century. It was all the same process, the ranging of the nations, as formerly of tribes and of cities, for the conquest, first, of the means to live, and, second, of a preferred economic position in the world.

Such is the business of war, and it is the oldest business in the world. It is aided by patriotism, prejudice, uncharitableness and a whole calendar of ugly tribal virtues, which enjoin us to love the means by which we get and hate the men from whom we take. It is aided by racial scorn, a thing as deep as life, yet subject on the whole to that more impelling factor, economic motive. The history of war and peace is a history of the overriding of sentimental considerations by imperious economic needs. During the Revolutionary War, no love was lost between the rigid, race-conscious Englishman and the despised red-skin, yet both joined hands to scalp Americans in the lonely settlements along our frontier. To-day German and Turk, Italian and Russian, Frenchman and Senegambian, Briton and Japanese, love each other at least temporarily because pursuing like interests. Not that the influence of race and nationality upon those mutual repulsions which lead to war can be brushed aside in a paragraph. They are potent, modifying factors, with a certain independence of action, and serving, with regard to economic motives, as accelerators, intensifiers or, to change the illustrations, as containers. Yet it is no great exaggeration to say that no racial antagonism can wholly sunder allies joined by a vital economic bond, and no racial sympathy firmly unite nations who want one indivisible thing. The "Anglo-Saxon cousins" now live in concord, but not solely because they are Anglo-Saxons. As for religious differences, which have in the past so often exacerbated the war spirit, this influence is less than appears. Even the godly live on bread and butter. The Protestant princes of the Reformation hated the Scarlet Woman because of the Real Presence, but they also hated her because of the golden stream that flowed from Germany to Rome. The English Reformation had less to do with Mistress Anne Boleyn than with the wealth of the monasteries. Especially among modern industrial nations, with their increasing theological apathy, are religious differences of relatively small importance in determining wars. It is the economic motive which tells.[2 - For a sketch of the economic influences bearing upon war, see the brilliant essay of Prof. Edward Van Dyke Robinson, "War and Economics in History and Theory," Political Science Quarterly, Vol. XV, pp. 581-622. Reproduced in "Sociology and Social Progress," compiled by Prof. Thomas Nixon Carver (1905), pp. 133-173. In the present chapter I have borrowed extensively from Professor Robinson's essay.]

Considering all these facts of history, so hastily reviewed, considering that in practically all countries and at all times economic impulses have tended to push men into war, is the conclusion forced upon us that we shall have war so long as we have economic desires, and that in the future mankind will continue to drag itself along a blood-stained path? Can we change in human nature that desire for material things, which has always been the great survival virtue of the race?

To many men the answer points to perpetual war. They believe that nations will fight so long as they are hungry, and they will always be hungry. War and birth are the twin immortals; there will always be more babies than can be fed and there will always be war. As well preach against death as against war, since the peaceful, abstaining nations are doomed to extinction and the war-like nations survive and determine the character of humanity. The meek nations do not inherit the earth. They go down in the ceaseless struggle between the living and the dying peoples.

During the last one hundred and fifty years, however, a more optimistic conviction has struggled for expression. The Industrial Revolution has enormously increased the wealth of the world, and has enabled over-populated industrial countries to secure their food from agricultural lands thousands of miles away. There has grown up a vast complementary trade between old and new countries, and even competing manufacturing nations find it profitable to trade with one other. The hope has therefore arisen that perhaps this war-breeding, economic motive may hereafter lead to peace and away from war. Admitted that peoples once had to fight, may it not in this New World of industry be "good business" to live and let live, to agree with your competitor, to trade amicably? May not the industrial transformations, undreamed of in past centuries, permit a world-population to live off its labour, immune from the necessity of killing? Have we not here an alternative to war?

The doctrine is that of laissez-faire, untrammelled competition, free trade. From Adam Smith down to the present day, it has been preached to us that each man's enlightened selfishness, unguided and unimpeded, will work out to the welfare of each society and to peace between all societies. The interests of nations in trade is held to be reciprocal. Buyer and seller both gain, so that England cannot prosper unless Germany prospers, and England cannot suffer without Germany suffering. You need not fight for commerce. Trade does not follow the flag but the line of greatest mutual advantage, as was shown, it is claimed, when Britain after losing political control of America doubled her commerce with America. It does not pay to fight for colonies, since colonials if left alone will buy in the cheapest and sell in the dearest market. With nothing to fight for, peace and prosperity will come with free trade, which the nations will adopt as soon as they perceive their own interests. There is no economic reason for warfare, which like other superstitions will vanish as men emerge from the darkness of ignorance.

It is a pacifying theory, and yet something seems wrong with it. The optimistic forecasts have been belied; the nations have not acclaimed free trade, but rear tariff walls higher than ever. Nor do the nations abjure colonial expansion, but fight for colonies and "spheres of influence" and lands for "peaceful penetration," as tribes once fought for pastures, and cities for trade-routes. The national spirit, instead of succumbing to an era of peaceful individualism and cosmopolitanism, is stronger and more embittered than ever. Armaments pile up. Colonial disputes become more acrid, international jealousies more acute, until in the end we are cast into the pit of the long-dreaded World War. We do not know that this is the last World War. We are not sure that the same inveterate, millennium-old struggle for food, the same bitter "business" which has always meant war, is yet finished and done for.

Even if war does not cease, however, may we not at least be exempt from the scourge on this safe side of the broad Atlantic? Though it rains outside, may we not keep dry beneath our big umbrella? We Americans are accustomed to think of ourselves as a peace-loving, unaggressive people, envying no nation its dominion or wealth, and incurring the enmity of no nation. Let the peoples of Europe destroy themselves in ceaseless, insane conflicts, but let us, by keeping to our side of the ocean, save ourselves from slaughter as Lot was saved from the fate of Gomorrah.

It is not a noble caution that thus disregards the fate of the world and seeks only the national safety. Nor is it in truth a wise caution. Those who are too circumspect incur the greatest danger, and those who trust to their own unoffending reckon on a doubtful factor. Why should we alone, among the nations be exempt from economic forces, which drive peace-loving nations into war? Have we by our rapid expansion, to say nothing of our Monroe declaration and other pretensions, failed to give offence in a world, in which mere having is aggression and mere growing a menace? Has our peace in the past been due to our own meekness and unaggressiveness, or has it been the gift of a fortunate economic condition, which may pass? Before we rely upon the continuance of a peace of mere isolation, we shall do well to inquire into the economic conditions which so long gave us peace.




CHAPTER III

PEACE WITHOUT EFFORT


To the average American of a few years ago the maintenance of peace seemed as natural and easy as breathing. Except for our brief and episodical conflict with Spain we had had no war with a European Power for a hundred years and we saw no reason why we should go to war in any of the coming centuries. Peace was merely an abstention from war, a not doing something, which we had no desire to do. We had no reason to provoke war, no foreign nation had a legitimate grievance against us. In any case we were inherently different from Europe. We were peaceful while Europe was war-like. So long as we tended to our own affairs–and that was our intention—peace was assured.

Believing thus in our intrinsic peacefulness, it was in no spirit of humility that we met the outbreak of the Great War. We did not put ourselves in the place of the fighting nations, and acknowledge that in their circumstances we too might have been struggling in the dust. Rather we boasted of our restraining democracy, and of our perfect co-operative union, which protected us from the European anarchy. We, a people unassailed, talked loudly of our superior merit, and, as we looked over the broad oceans and saw no enemy, thanked God that He had not made us as other nations. Our compassion for the peoples of Europe was tinged with a bland, self-righteous arrogance.

It is not pleasant to-day to read the homilies which America, during those early months of the war, preached to unheeding Europe. Throughout runs a note of subdued self-exaltation. We, the Americans, so ran the boast, are not ruled by Kaiser or Czar, and cannot be stampeded into war against our will. We do not extend our national territory by force. Of all nations we are the one that has best compounded economic differences and best dissolved racial hatreds. We live in amity with all the world, and with piety preach our lessons to the war-mad races. How fundamentally insolent, though well-intentioned, was this message of one of our leading citizens to Germany. "The American people cry with one voice to the German people, like Ezekiel to the house of Israel: 'Turn ye, turn ye, from your evil ways; for why will ye die?'"

Even in our churches we made the same unconscious boast. On Sunday, October 4, 1914, at the request of the President of the United States, millions of Americans went down on their knees, and prayed God no longer to scourge the peoples of Europe. It was a sincere prayer, evoked by real compassion. Yet nothing could more clearly have revealed our moral detachment, our obliviousness to the fact that the passions which brought forth this war were human, not European passions. We, the virtuous, interceded for the vicious; our prayer was "deliver them from evil." With malice toward none, with charity towards all, envying no nation its treasures, content to enjoy in peace what God had given us, America folded its hands in prayer.

To a sceptical European, accustomed to the cant of international protestations, this boasted peacefulness of ours seems suspicious. "Have you," he might ask, "always been peaceful? Did you not fight England, Mexico and Spain? Have you not taken advantage of your neighbours' necessities?" Such a European might not regard Americans as a nation, divinely appointed to bring peace to a world rent by war. He might not acknowledge that we are more law-abiding than other peoples, freer from race hatreds, gentler towards the unfortunates of our own race. He might point to our lynchings and riots; to our unpunished murders of Chinese, Italians and Mexicans; to the system of repression, by which the Southern whites terrorized the freedmen after the Civil War. If Europe did not solve the Balkan problem in peace, did Americans end slavery without resort to arms?

We may not like these imputations, but it would be hard to deny that in certain national crises we have not been impossibly virtuous. We have not always subordinated our national interests to the ideal of setting a righteous example. What we wanted and could get we got, whether it was Florida, Texas, California or Panama. We were not above the twisting or even the breaking of a treaty, we did not discourage filibustering expeditions too rigorously, and we were never, never meek. Thus in 1818, to take a single example, we addressed to Spain a polite communication in which we asserted that "the United States can as little compound with impotence as with perfidy, and that Spain must immediately make her election, either to place (an adequate) force in Florida or cede to the United States a province, of which she retains nothing but the nominal possession." Many of our communications to Mexico, Chile, Spain, and even England were equally arrogant.

The truth is that our peace has been a peace of circumstances, due to a favouring geographical and economic situation. Our peacefulness came down to us like our rivers, farms and cities, a heritage of exceptional conditions. We were inaccessible to European armies. We were supreme on a fertile, sparsely settled continent. We could afford peace. Our resources were immensely great and if we did not reach out for more, it was because we already had as much as we could handle. What we did need we could take from weak peoples, and a nation which fights weak peoples need not be martial, just as a man who robs orphans need not be a thug.

It might have been different. Had our Westward progress been opposed by millions of Indians, had France been able to resist our march beyond the Appalachians, or Mexico stood like a disciplined Germany between us and the Westward Ocean, we should have developed a military civilisation. As our growing population pressed upon our narrow frontiers, we should have had our war scares, our border conflicts, our national hatreds, our huge standing army, and the whole paraphernalia of militarism.

Still another element, besides our geographical isolation and our economic self-sufficiency, contributed to our intactness and security and permitted us to indulge in the luxury of pacifism. Europe protected us from Europe. We were one and the European Powers many. So delicate was the balance that the European nations could not hazard a really serious trans-Atlantic venture. They had little to gain and much to lose by fighting us, as we had nothing to gain by fighting them. Our interest in such European affairs as the independence of Greece, Hungary and Poland was purely sentimental. Towards Europe we were peaceful as we were peaceful towards Mars. True, our safe orators delighted in twisting the lion's tail and upbraiding the Czar of all the Russias. During the eighty-three years between 1815 and 1898, however, we were never at war with a European nation.

It was not that we loved Europe too well. England we detested and hardly a decade passed without some acrid boundary dispute. We thought her arrogant, greedy, supercilious, and she thought us arrogant, greedy and coarse. Millions of Irish immigrants intensified this animosity and our national vanity did the rest. But though we hated England she was too formidable to be attacked. Therefore we bluffed and she bluffed, and in the end we compromised.

With other countries it was still easier to keep at peace. Prussia, Austria and the smaller German states were too distant to affect our interests. For Russia we had a vague attachment, and except on one occasion, she never threatened our ambitions. With France we were on good terms except during our Civil War. We disliked Spain and despised her, but events prevented our going to war with her.

It was because it paid that we kept at peace; any other policy would have been wasteful, even suicidal. Our future depended upon our ability to keep out of war. A sparse population on the edge of a vast continent, our hope of national success lay in an isolation, which would give us strength for future struggles. Our mission was to settle the empty lands to the West before other nations could pre-empt them. To embroil ourselves with strong powers was to court disaster, while even to interest ourselves in European politics would divert our mind from our own imperative task.

Our first American foreign policy, therefore was disentanglement. We often speak as though America passively abstained from entering European politics. We were, however, already a part of the unsteady balance of power, and warring France and England sought our aid, much as the two coalitions might seek the aid of a Bulgaria, not loving her but needing her help. It was a bold and above all a positive policy that Washington established when he broke the French treaty and declared our neutrality. Though denounced as dishonourable, this policy was essential to our welfare and peace, for the country was more dangerously divided in 1793 than in 1916.

How intimately our peace has depended upon our economic development is revealed by the early failure of this policy of disentanglement. Prior to 1812 our immediate economic interests overhung our territory and transcended our sovereignty. All Europe being at war, we were the neutral carriers of the world. Our ships brought merchandise to France from her colonies and allies, and goods from the West Indies and South America to all parts of Europe. In the decade ending 1801 our foreign trade, which was dependent upon the indulgence of Europe, more than quadrupled. The profits on our carrying trade were immense. Our shipbuilding industry increased, and not only were orders filled for our own foreign trade but many ships were manufactured for export. The prices of agricultural products almost doubled and our meat, flour, cotton and wool found a ready market in Europe. Our prosperity depended upon this newly created foreign trade. Sail-makers, ship-builders, draymen, farmers, merchants were dependent upon a trade which menaced the commercial supremacy of Great Britain and upon which even France looked with jealous apprehension.

It was this conflict of our interests with those of a stronger nation that brought on the bitter controversies with Great Britain, and resulted in the tedious war of 1812. We were more dependent upon Europe than Europe upon us, as was shown by the fiasco of our Embargo policy. England, determined to kill our commerce, would have fought many years to accomplish this purpose. But it did not prove necessary. Our commercial progress, that had been merely an incident in a European war, lessened after the peace. For us this was fortunate. Our future lay in our own continent, and not on the high sea where as a relatively weak nation, we should have been forced to compete with the world and war continually with England.

To-day, one hundred years later we are still pacific, because of the direction taken by our economic development since 1815. While we developed agriculture, constructed turnpikes, canals and railroads, manufactured for the home market, and filled up the country from the Appalachians to the Pacific, our American-borne commerce and our shipbuilding declined; by 1846, our American tonnage in foreign trade was less than in 1810. But the profits of this carrying trade were no longer necessary, since in exchange for our imports from Europe we could now export cotton. We were no longer competitors with Europe, but had become contributors to European prosperity. Prior to 1815 England looked upon us as a commercial rival; after 1815 we became the unconscious economic allies of all the industrial nations.

The extent to which our economic system had become complementary to the European economic system is illustrated by a study of the statistics of our foreign commerce. Of our exports one-half was raw cotton, and upon a steady supply of this fibre a great European industry depended. Later we shipped huge quantities of food which was also needed by the manufacturers across the sea. As our cotton area extended, as our wheat and meat exports increased, European, and especially British, industry profited. At the same time, despite our high tariffs we furnished an increasing market for wares manufactured in Europe, while our own manufactures did not largely compete in the world markets. Moreover the rapid development of our internal resources furnished lucrative investment opportunities to European capital. A source of raw material, a market for manufactured products, a field for profitable investment, America was Europe's back-yard, an economic colony, though politically independent.

In the midst of this almost colonial development, there occurred one startling interlude. About 1840 we developed a new type of sailing vessel, the American clipper ship. Soon we had control of the China trade and by 1861 our shipping (including domestic trade and the fisheries) about equalled that of Great Britain. After the Civil War, however, our chance of competing with Great Britain either in ship-building or carrying disappeared. The iron steamship had arrived, and, in the manufacture of such vessels, we were no match for the English. Even without the Civil War we should have been beaten; the Southern privateers, outfitted in English ports, merely hastened an inevitable decay. We were not yet to enter upon a competition with England for commercial supremacy.

There being thus no economic basis for war our outstanding questions with European nations, and with England especially, were peacefully settled. The Canadian fisheries and the Maine boundary dispute gave rise to much bitter feeling but were not worth a war. Even the Monroe Doctrine did not bring on a clash. Though Great Britain hated its assumptions she was content with its practical workings. What the United States gained was immunity from the settlement of Latin America by powerful military nations; what England gained was a profitable trade (denied her by Spain) together with opportunities for investing capital. The immediate force behind the Monroe Doctrine was the self-interest and naval power of a nation, which did not recognise the doctrine.

Our westward expansion, which obliterated boundaries and overran the possessions of other powers, also failed to bring war with Europe. Doubtless this expansion was not entirely welcome to France, England and Spain. But just as Napoleon, though dreaming of a French Empire on our western border, had been compelled to sell us Louisiana to prevent its falling into British hands, so later England resigned herself to our almost instinctive growth. It was believed in the forties that England not only wished to prevent our acquiring California but desired the territory for herself, and it was known that her interests in Oregon were in the sharpest conflict with American claims. England would also have preferred that Texas remain politically independent of the United States and commercially dependent upon herself. Fortunately for us, however, an aggressive colonial policy, such as that which during the last forty years has partitioned Africa, was not yet popular in Europe. England was thinking in terms of free trade and commercial expansion, of a world rather than a colonial market. At bottom, moreover, this American expansion was to the relative advantage of Europe. When Spain was cajoled and worried into selling Florida; when Texas, and later California, Arizona and New Mexico were taken from a nation too weak almost to feel resentment, the result was a better use of the territory and a greater production of the things which Europe needed. If Europe was not to control these regions, it was at least better for her to have them pass to us rather than remain with Mexico. So long as we held politically aloof, sold Europe cotton and wheat, bought from her manufactured products and gave her the chance to invest in our railroads, so long as we did not compete on the sea or in the world markets, Europe, though she envied us our easy expansion, had no interest in opposing it by war. England would possibly have fought us had we taken Nicaragua and almost certainly had we taken Canada, but she was less concerned about the fate of Mexico, the chief victim of our expansion.

This complementary relation of ours with European nations was as useful to us as to them. Besides furnishing us with necessary capital Europe sent us immigrants, who made our march across the Continent rapid and irresistible. In the end this immigrant population contributed to our peaceful attitude. As the number of our alien stocks increased, the desirability of going to war with any European nation diminished. To get the immigrant's vote, we spoke highly, and in the end almost thought highly, of the nations from which they had come. By admitting the children of Europe we had given hostages to peace.

In the main, however, we paid no attention to Europe. We forgot about her. Lost in contemplation of our own limitless future, we turned our eyes westward towards our ever receding frontier. In foreign, as in home relations, we developed a frontier mind, and even to-day, long after our last frontier has been reached, we are still thinking of Europe, as of so many of our internal problems, in terms of this great colonising adventure. The individualist, who pushed his way across the continent, left on America the impress of a simple philosophy, a belief that there was a chance for all, that it was better to work than to fight, that arbitration and the splitting of the difference were the best policy. To the average American, with his frontier mind, wars seemed unnecessary, and all the class distinctions, inseparable from militarism, a mere frippery. Wars, he held, are for the crowded old peoples of Europe, with their dynastic superstitions, their cheating diplomacy, their ancient rancours, their millions of paupered subjects, condemned to a life of subordination. Wars are not for the free and equal Americans who live in the wide spaces of a continent and, having no neighbours, hate no man and fear no man.

It is out of this frontier mind that we have evolved our present American notion of war and foreign policy. Peace is common sense; war, foolishness, a superstition like the belief in Kings, Emperors and Potentates, a calamity caused by the refusal of the petty European nations to join into one great United States. For it must be remembered that Americans, whatever their sentimental attachments, are really more contemptuous than are Germans of little nations that insist upon surviving. We ridicule the European customs barriers, which the express train strikes every few hours, and associate national greatness with territorial size. Even Great Britain, France, Germany and Austria are ignorantly regarded as "little nations," which would be all the better for a wholesome amalgamation. The frontier mind believes stubbornly that short of such a union, these "little" peoples should develop their own resources in peace. In other words, our attitude towards Europe, which is a result of our elbow room and our economic self-sufficiency, is vaguely missionary, with not the slightest tinge of hypocrisy. We have no concern with Europe and no duty to interfere, beyond expressing our belief in our own superior institutions and the hope that Europe will learn by our example.

The development of our manufacturing industries, until recently at least, did not alter these views concerning our proper attitude to Europe. The new industries, chiefly designed for a home market, made on the whole for peace. Nor did we need a foreign outlet for capital. No one wished to go to war for the dubious privilege of investing in Peru or China when our own iron mills, cotton factories and railroads were clamouring for capital, to say nothing of our farmers in Oklahoma and the Dakotas.

Psychologically, also, this self-poised industrialism, this domestic stay-at-home business of ours, which prevailed until a few decades ago, worked powerfully for peace. We became a highly individualistic manufacturing nation, composed of millions of self-seeking, money-making men. As "business men" we hated wars as we hated strikes and whatever else "interfered with business." Our ideal was a strenuous life of acquisition, in which dollars were added to dollars, and the prosperity of all depended upon the bank account of each. Wars were like earthquakes and other interruptions of the ordained process of accumulation; you could no more win a war than you could win an earthquake. America's manifest destiny was to multiply and increase. We were to mind our own business and live in peace with neighbours, whom we did not know and rather despised. Since everything worth exploiting was in our own country, since Europe left us alone and had nothing that we were willing to fight for, we were free to ignore all foreign relations.

The diplomacy which accompanied and aided this development, though not heroic, was at least successful. It enabled us to grow strong and hold strong enemies away. Not always consistent, not always able, not always honest, our diplomacy maintained a certain unity, kept us aloof from European quarrels, guarded us from threatened intervention during the Civil War crisis, warned Europe against the conquest of Latin America, and above all—permitted us to grow. From 1815 to 1898 our population increased from eight to seventy-two millions, while that of the United Kingdom increased only from some twenty to forty-one millions and that of France from twenty-nine to thirty-nine millions. Our wealth increased at a more rapid rate than that of any other nation.

Small wonder that in the last decades of this period our diplomacy sank to the lowest level of incapacity. Having grown strong without Europe's aid or hindrance, having reached that pleasant degree of independence in which diplomacy seemed a mere international formality, we came to believe that the best diplomacy was none at all. We did not require in our ambassadors knowledge or astuteness; any fool would do. Our diplomats were often despised, but since we were not dependent upon Europe's favour, it did not matter. Economic forces, stronger than the diplomats of all the world, were making for peace between America and Europe.

But even while we were sending political adventurers to some of the great capitals of Europe, a change was impending. All at once the United States found itself at war with a European power, and, a few months later, in surprised, not to say embarrassed, possession of tropical Asiatic Islands. Suddenly we discovered that we were feared and disliked; that there were points of controversy between us and various European countries; that Europe somehow did not regard the Monroe Doctrine as a divine dispensation, which it would be impious to oppose. We heard talk of international competition, World Power, "the American Menace." Beneath the surface there appeared indications that our long mutuality of economic interest with Europe was no longer complete. The easy instinctive peace which had enabled us to attain our ends without considering Europe seemed about to end.




CHAPTER IV

AN UNRIPE IMPERIALISM


It was in the year 1898 that the United States made its earliest plunge into imperialism. Then for the first time we secured "dominions beyond the sea"; dominions too thickly populated to be adapted for purposes of colonisation. By our earlier conquests and purchases (Louisiana, Florida, Texas, California, New Mexico), we had secured relatively empty territories which a flow of emigrants from our Eastern States could rapidly Americanise. But in Porto Rico, the Philippines and Hawaii, there was neither prospect nor intention of colonising. The impulse that led to their taking was the desire to possess their wealth, to rule and "civilise" them, and above all not "to haul down the flag." It was an impulse not very different from that which led to the European partition of Africa.[3 - "Early in the year 1901, a foreign ambassador at Washington remarked in the course of a conversation that, although he had been in America only a short time, he had seen two different countries, the United States before the war with Spain, and the United States since the war with Spain. This was a picturesque way of expressing the truth, now generally accepted, that the war of 1898 was a turning point in the history of the American republic."—"The United States as a World Power," by Archibald Gary Coolidge. New York, 1912.]

The change in our policy was startling. We had seemed, after the Civil War, to have reached a stage of satiety, to be through with expansion. Henceforth the ocean was to be our boundary; we were not, like the slave-owners before the war, to scheme for new lands in Central America and the Caribbean. When in 1867 Russia offered us a territory almost three times as large as Germany for a sum about equal to the value of the Equitable Building, we accepted only to oblige Russia and because we believed that we were in honour bound to buy. We refused to purchase St. Thomas and St. Johns, although Denmark offered to sell cheap, and we declined to annex San Domingo or to entertain Sweden's proposal to purchase her West Indian possessions. Again in 1893, instead of annexing Hawaii, we vainly sought to bolster up the sovereignty of a native Queen. Then suddenly Porto Rico, the Philippines and Guam were annexed; Hawaii was incorporated and Samoa was divided up with Germany.

In part this change in foreign policy was due to military considerations. The possession of Hawaii, Panama and Guantanamo in Cuba was obviously necessary for the defence of our coasts. Just as the Monroe Doctrine was intended to protect us from the approach of great military powers, so these new acquisitions were desired to pre-empt near-lying bases, from which, in enemy possession fleets might assail our trade or cut off our communications.[4 - For a study of these strategic considerations see "The Interest of America in Sea Power, Present and Future," by Captain (later Rear-Admiral) A. T. Mahan, a series of articles written between 1890 and 1897. Boston, 1911.]

Such strategic considerations, however, do not explain the whole of our new imperialistic policy. Economic motives played their part. We changed our foreign policy because at the same time we were undergoing a commercial and industrial revolution.

As a result of this industrial change our merchants had begun to think in terms of foreign markets and our financiers in terms of foreign investments. We had passed through the stage in which our industrial life was completely self-sufficing. We were becoming a manufacturing nation, requiring markets for the disposal of surplus products. We were, it appeared, being drawn into a great international competition, in which markets in China, South America and backward countries were the prizes. Simultaneously our foreign commerce had changed. Our growing population had made increasing demands upon our food products, leaving less to be exported, and at the same time our exports of manufactures had increased. In 1880 we exported manufactures (ready for consumption) to the value of ninety-three millions of dollars; in 1898 to the value of two hundred and twenty-three millions.

Other industrial factors tended also to bring about a change in our national ideals. We were beginning to believe in the economic efficiency of trust organisation, and our industry, conducted on a larger scale, was being increasingly concentrated. A new class was in financial control of our great industries. The trust magnate, the new conductor of vast industrial enterprises, was looking forward toward a strong unified banking control over industries and a definite expansion of American trade in foreign countries. American capitalists were beginning to believe that their economic needs were the same as those of the European capitalists, who were enticing their nations into imperialism.

Psychologically, also, we were ripe for any imperialistic venture, for we enormously exaggerated the progress we had made towards industrialisation, and were thinking in terms of Europe. We suddenly believed that we too were over-filled with capital and compelled to find an outlet for investments and trade. Innumerable editorials appeared, presenting the arguments for imperialism that had been urged ad nauseam in Europe. We could not resist, it was argued, the ubiquitous economic tendency toward expansion. In all countries, including America, capital was to become congested. An over-saving of capital, invested in manufacturing plants, produced far in excess of the possible consumption of the people. We had reached a stage of chronic over-production, in which increased saving and increased investment of capital would permanently outstrip consumption. Everywhere wealth was being heaped up; the savings-banks overflowed; the rate of interest fell and capital sought desperately for new investments. The capitalist system must either expand or burst.

Certain superficial developments in the United States formed the groundwork of these gloomy prophecies. We had just passed through a commercial depression, during which prices and interest rates fell and great numbers of workers were left unemployed. These facts were exploited by political leaders and industrial magnates, who thought in terms of the subordination of American foreign policy to the needs of big business. It is not surprising therefore that they became infected with the new imperialism, which in Europe had been growing steadily for over fifteen years, and that they came to the conclusion that America could not hold hands off while the markets and investment fields of the world were divided up among her rivals.

"The United States," wrote Charles A. Conant, one of the intellectual leaders of this movement (in 1898), "cannot afford to adhere to a policy of isolation while other nations are reaching out for the command of new markets. The United States are still large users of foreign capital, but American investors are not willing to see the return upon their investments reduced to the European level. Interest rates have greatly declined here within the last five years. New markets and new opportunities for investment must be found if surplus capital is to be profitably employed."

Like so many of the pamphleteers of 1898, Mr. Conant was convinced that imperialism offered the only cure "for the enormous congestion of capital." No civilised state, he contended, would accept the doctrine that saving should be abandoned. And while human desires were expansible, he doubted whether the demand for goods could possibly increase with sufficient rapidity to absorb the new productive capacities of the nation. "There has never been a time," he writes, "when the proportion of capital to be absorbed has been so great in proportion to possible new demands. Means for building more bicycle factories than are needed, and for laying more electric railways than are able to pay dividends, have been taken out of current savings within the last few years, without producing any marked effect upon their amount and without doing more, at the most, than to stay the downward course of the rate of interest."

It therefore follows conclusively that the American conquest of markets and fields for investment must go on. The method of such a conquest is of little importance. "In pointing out," he says, "the necessity that the United States shall enter upon a broad national policy, it need not be determined in just what manner that policy shall be worked out. Whether the United States shall actually acquire territorial possessions, shall set up captain generalships and garrisons, whether they shall adopt the middle ground of protecting sovereignties nominally independent, or whether they shall content themselves with naval stations and diplomatic representations as the basis for asserting their rights to the free commerce of the East, is a matter of detail."

I have quoted Mr. Conant at length because he is so largely typical of the state of mind of the American plutocracy in the year 1898. It would have been easily possible, however, to have presented any amount of confirmatory material of exactly the same nature. An article by W. Dodsworth in the October, 1898 number of the Nineteenth Century is along the same lines. Here again we read of an unprecedented industrial revolution during the preceding half century and a vast increase in foreign trade and accumulated wealth. Again we read of the falling rate of interest and of the failure of trusts and combines to resist the outside pressure of necessitous capital, seeking to force its way into industries. It was held quite impossible for consumption to absorb the products of an over-fertile industry. "I am no pessimist," writes Mr. Dodsworth, "but I cannot conceal my deep conviction that, if this relief is not forthcoming, a stage of grave industrial collapse, attended with the agitation of equally grave political issues, becomes only too probable, and the energies of our seventy-five millions of producers may have to be restrained until we learn to appreciate the penalty of our neglect of foreign enterprise."

Such were the arguments with which in 1898 the United States plunged into imperialism. We were to break out of the narrow circle which confined our economic life to become the work-shop of the world as England had once been, to export and export and ever increasingly export until all the nations should be our debtors. Our capital, like our wares, was to go to all countries. It flattered our pride when, a few years later, Europe trembled at the spectre of an American commercial invasion and even England wondered whether she could withstand the flood of cheap manufactured American goods, dumped on her shores. We pictured a vastly increasing trade with our new colonial possessions and with China; we envisaged opportunities, not only of an immense American investment, but of an even greater American trade.

What we believed of ourselves, Europe only too credulously believed of us. Leading European economists and publicists were completely convinced that the United States was irrevocably embarked on "the sea of imperialism." "The recent entrance of the powerful and progressive nation of the United States of America upon imperialism," wrote Prof. John A. Hobson in 1902, "… not only adds a new formidable competitor for trade and territory, but changes and complicates the issue. As the focus of political attention and activity shifts more to the Pacific States, and the commercial aspirations of America are more and more set upon trade with the Pacific Islands and the Asiatic coast, the same forces which are driving European States along the path of territorial expansion seem likely to act upon the United States."[5 - John A. Hobson, "Imperialism," p. 23. London, 1902.] Professor Hobson and other foreign observers believed that our great trusts, which were being formed with reckless suddenness, would enormously increase the capital seeking an outlet, and that new imperialistic ventures would result. "Cuba, the Philippines, Hawaii," he insisted, "are but the hors d'oeuvre to whet an appetite for an ampler banquet."[6 - Op. cit., p. 83.]

This development toward a congestion of capital, though confidently anticipated both in the United States and in Europe, did not take place. About the end of the century an enormous extension of the general field for foreign investment raised interest rates all over the world. The demand for capital grew with astonishing rapidity. In part this was due to British, French and German foreign investments, but it was also the result of a quickened economic tempo in all countries. New industries were created, wages rose (though in most countries not so rapidly as prices) and the outlets for the supposed superfluous capital were greater than ever.

Especially in the United States was the development contrary to that which had been anticipated. Capital was not rendered idle because of any slackening in the nation's consuming capacity, for the men of average and small income were able to purchase more than ever before. The farmers alone, whose property increased in value from twenty and a half billions of dollars in 1900 to forty-one billions in 1910 (an increase of over 100 per cent. as compared with less than 28 per cent. in the previous decade) added stupendously to a new demand for goods of all sorts. Of automobiles, unknown in 1898, there are in 1916 almost three millions. Innumerable other industries arose and expanded; the anticipated arrest of accumulation did not occur.

The result of this economic development soon made itself apparent. We discovered, fortunately for us, that we were not at this time to become the work-shop of the world. We could not continue to produce articles cheaper than England or Germany, and undersell these countries in their home markets. We discovered that our own country still furnished an admirable field for investment. While our foreign commerce increased, it continued to form only a small part of our whole trade. So long as vast new opportunities for the investment of capital in the United States presented themselves, we ceased to worry about foreign or colonial outlets, and for every dollar of American money invested in Porto Rico and the Philippines, hundreds of dollars were invested in the states. Our capital though accumulating at an ever-increasing rate, did not equal the demand.[7 - In 1914, twenty-six years after the cession of the islands our combined import to and export from the Philippines amounted to only $51,246,128, or less than 1/75 of our entire foreign commerce. Our commerce with China, which was to have been opened by our possession of the Philippines was less than one-half of that with Brazil and less than one-twelfth of that with Great Britain.]

In other words, the conditions in America did not yet warrant an imperialistic policy. We were economically younger than we had thought; more elastic, with greater capacity for internal growth. As a result of this discovery, our sudden enthusiasm for dominions beyond the seas died down. We were disgusted and bored by the Philippine war; we hated the rôle of oppressors, in which we unwillingly found ourselves. We hated the water cure, punitive expeditions, and the endless controversies over the status of Filipinos under American law. The anti-imperialistic elements in America, men whose interests did not lie in foreign trade and speculation, stolidly opposed the retention of the islands. Had the election of 1900 been fought upon this single issue it would probably have been won by the anti-imperialists. Even though we kept the islands, we set definite limitations to our imperialistic ventures. We secured for the Philippines an administration which prevented the exploitation of the natives and the importation of Chinese labour. We set our faces against any policy of sacrificing the interests of the indigenous population to the interests of American financiers. And to-day, could we do it with due regard to the interests of the Filipinos, we would retire from the archipelago.

As we look over this experiment, we cannot help recognising that it was a precocious, an unripe imperialism. For us it was too early to secure Asiatic islands; too early to worry about American investments in foreign lands. It was an imperialism carried out somnambulistically. Our taking the Philippines was an accident, unforeseen and undesired.[8 - "At the beginning of the war (with Spain) there was perhaps not a soul in the whole Republic who so much as thought of the possibility of this nation becoming a sovereign power in the Orient."—"World Politics," by Prof. Paul I. Reinsch, New York, 1913, p. 64.] Our hope of being the work-shop and banking centre of the world, of being the heart of a great empire like that of Britain, and of doing all this within a short period, was a dream, which vanished with the new demands made upon American capital by an increasing economic expansion.

The truth is that this unripe imperialism did not represent the interests of the majority nor even of any considerable group of our capital owners. It was doomed to disappearance once the revival of American industry offered opportunities, not only for the ordinary capitalist, but for that more speculative investor, who in other countries clamours for imperialism. The experiment revealed, however, that the same forces which act upon capital in Europe act also upon capital in America, and that the United States, given the right conditions, is liable to the same ambitions as are imperialistic countries and is as likely to engage in war to satisfy these ambitions. The imperialistic trend acts upon all nations at a given stage in their economic development. It cannot be stopped by traditions of peacefulness or by mere protestations, however sincere. It is a part of the great economic strife, out of which devastating wars arise.




CHAPTER V

FACING OUTWARD


While the imperialistic venture of 1898 was premature and did not lead, as had been expected, to a conscious participation of America in the international scramble for colonies, it affected our national thinking and forced us to re-consider the position of America in relation to the ambitions and plans of other great nations. Our acquisition of new dependencies led us to recognise that we were at last a world power, with the responsibilities of a world power. We were obliged to learn from England and other imperialistic nations the lessons of colonial administration. Year by year we were drawn into closer relations with the West Indies and the Caribbean countries, and were compelled to assume financial control of Hayti and San Domingo in the interest both of foreign capital and of the countries themselves. The completion of the Panama Canal increased our sense of international danger and international responsibility. Finally the revolution in Mexico proved to us that whatever our positive action we could not remain passive.

Our Monroe Doctrine also, which had always seemed our charter of independence of Europe, forces us in the end to come to an understanding with Europe. We had set our faces against European conquest in the Americas, and therefore against any punitive expedition, likely to lead to permanent occupation. But if we protected Hayti and San Domingo from Europe, we assumed a certain responsibility for the actions of these countries. In the existing state of international law, a nation assumes the right to protect its citizens from spoliation and to compel debtor countries to meet their obligations. In this right to collect debts by force of arms, which has been the excuse for innumerable imperialistic extensions, all the great creditor nations are interested. Had the United States refused to intervene in San Domingo, while forbidding the great powers to secure redress by threats, we might possibly have been forced to fight against overwhelming odds in defence of a people and cause, for which we had little sympathy. By its very prohibitions the Monroe Doctrine compels us increasingly to intervene between the weaker Latin-American countries and the warlike creditor nations of Europe.

The gradual extension of the Doctrine, moreover, vastly increases our possible area of friction with Europe. Originally planned to prevent European nations from conquering parts of the Americas, the Doctrine has now been extended to forbid foreign corporations subsidised or controlled by an Old World government to acquire any land in the Americas which might menace the safety or communications of the United States. Our action in Mexico indicates that we are determined not only to prevent Europe from introducing monarchical institutions into American countries, but to insist that those countries themselves adhere to the outward forms of popular government. Secretary Olney was speaking no doubt largely for home consumption when he declared that "the United States is practical sovereign on this continent (hemisphere), and its fiat is law upon the subject to which it confines its interpretation." Nevertheless the extension of control either by the United States or some group of powers is almost inevitable, and with the widening of the Monroe Doctrine, as a result of closer relations between Latin America and the Old World, the necessity for some arrangement between the United States and the great European powers becomes increasingly obvious.

Our possession of Hawaii and the Philippines acts in the same manner. In a military sense the Philippines are indefensible; we cannot secure them against a near-lying military power. Nor can we in the present stage of national feeling permit them to be conquered. Consequently we watch the actions of Japan with quite different feelings than if we had not given her provocation and a bait. The building of the Panama Canal equally increases our international liabilities. It contributes a vast new importance to the Caribbean Sea and adds a new weak point to American territory. Having built and fortified the canal, we are compelled to think of ways and means of defending it, of armies, navies, ententes and alliances.

While all these factors, however, have contributed to our changed point of view, it was the World War which most completely revealed to Americans the necessity of accommodating our national development to that of other countries. The war proved that we were in a military sense vulnerable; that undisciplined citizen soldiery was no match for trained armies; that mere distance is no complete safety, and that the initial advantage, which accrues to the prepared nation is out of all proportion more valuable than later victories. The war showed that unarmed neutrality and a mere lack of hostile intention does not always save a nation from invasion. Moreover, we discovered that our interests were affected favourably or adversely by a conflict, in which we had no direct part. We, who had always conceived ourselves as a supremely disinterested nation, a remote island in the blue sea, began to ask whether it was to our advantage to have France defeated, Belgium destroyed, Germany crushed, the British Empire disintegrated. We began to ask how our national interest was affected by the international competition for colonies, by the freedom or unfreedom of the seas, by the extension of the right of blockade, by the abrogation of established laws of warfare; and what the effect upon us would be of an economic alliance against Germany by the Allied Western Powers. In other words, we discovered a real national interest in international arrangements created by the war or to be established after the war.

Our first preoccupation was naturally one of defence. We looked outward, but only saw armed nations ready to seize upon our wealth and territory. Responsible authors predicted that the victor in this war would at his leisure move across the ocean and despoil the United States. From ponderous puerilities of this sort to the lurid descriptions of massacre and pillage, vouchsafed us by magazine and moving picture writers, was a short step. More serious arguments prevailed, and in the end a large addition was made to our military and naval forces. But the whole campaign was based solely upon the theory of defence, and the theory so formulated, was merely a continuation of the policy of isolation. It involved the idea that we were to act alone and protect ourselves alone against all nations. It did not concern itself with our national aims. It was not based upon a definition of our relations to Europe and to the several nations of Europe.

As our preparations increase, however, and as we realise how insufficient our force must be against a European coalition, we shall be faced with the alternative of entering into agreements or alliances (to make our defence real) or into some other policy, which might make defence unnecessary. In either case we must face outward, must look at the world as it is and is to be, and define our relation to Europe. We must substitute a positive for a negative policy.

This we are forced to do even though we may have no immediate friction points with Europe. The economic interpenetration of all nations involves us in conflicts of interest and adjustments, which require a positive national policy.

It is our economic development that most strongly pushes us in this direction. We are gradually destroying the complementary industrial system which formerly held us to Europe; we are competing with European countries for world markets and have even begun to compete for investment opportunities in backward countries. We are exporting manufactures, and this exportation is likely to increase. Of the six chief requisites of a great manufacturing nation—coal, iron, copper, wood, cotton and wool—we are the greatest single producer of all except the last, and to this advantage of cheap raw materials, there is added an efficient manufacturing organisation and a large manufacturing capital. From 1880 to 1910 that capital increased six and a half fold (from 2.8 to 18.4 billions of dollars). It is therefore no wonder that we are exporting tools, sewing-machines, locomotives, typewriters, automobiles and electrical apparatus. These products compete increasingly with similar products from England and Germany and invade the markets which Europe desires for herself. Our total exports to Latin America, for example, have almost quadrupled in twenty-two years, increasing from 77 millions of dollars in 1890 to 296 millions in 1912.

The significance of this competition, as it exists to-day and will exist to-morrow, is greater for Europe than for us. Our fundamental welfare does not absolutely depend upon this exportation; we could lose a part of this trade, as we lost our shipping, without fatal results, for we should still have our cotton and many half-finished products to exchange for our imports. Were Great Britain, however, to lose her markets for manufactured goods, she would shrink into insignificance, if she did not literally starve. In 1913 the United Kingdom spent $1,400,000,000 on imported foods, drink and tobacco, and for this, as for her importation of raw materials, she must pay. While our export of manufactures still forms but a trifling part (perhaps one thirtieth) of our total product, the British and the German export constitutes an immensely larger proportion. Our export of finished wares, despite its rapid increase, was in 1914 only some seven dollars per capita, while that of the United Kingdom was about forty-five dollars per capita.[9 - This comparison is not exact, since the British statistics include articles under manufactures which we do not include, and exclude articles which we include. I cite these figures merely to show that there is a vast difference in the relative importance to the United Kingdom and the United States of their export of manufactures, but not to show exactly what that difference is. Similarly the comparison above between the total product of American manufacturing and our export of manufactures is approximate.] It will therefore not be wondered at if our increasing export of manufactures both to Europe and to the countries to which Europe exports, causes us to be involved, as we have not been for over a century, in the ambitions, conflicts and life-interests of the great European nations.

For at bottom a commercial war is an industrial war, a struggle for national prosperity. If, for example, Germany fails to hold her foreign markets, she must shut down factories. Her industrial problem is to buy raw materials from abroad cheap, ship to Germany, manufacture into finished products, transport to a country willing to buy, and from this enterprise secure profits enough to purchase food for her people. If she is beaten out, let us say, in the export cotton industry she must turn to something else. She may try to save the industry by increasing efficiency or reducing wages, but if she fails, she must close up some of her mills. If she cannot employ the growing masses who depend upon export industries, she must let her surplus people—and with them a part of her capital—emigrate. Like other European countries she has learned this lesson by experience. Thus it often happened when America increased her tariff rates that European factories, unable to compete, migrated, men and capital, to this country. It is true that the world market constantly expands, but the producing capacity of the manufacturing nations also increases, and competition becomes ever more severe. The more rapidly America invades the markets which Europe has hitherto held, the more she squeezes them, the more bitter the feeling against her will become.

That bitterness of feeling (in the conditions preceding the present war) was more likely to arise in Germany than in England and more likely in England than in France. We have spoken of these as rival nations, but there are intensities of rivalry varying in proportion to the similarity of products and of methods of production. Germany, like the United States, is a new-comer in international industry, pushing and aggressive. More scientific and better organised than we, she possesses far more meagre resources. We both have trusts or cartels, and both manufacture huge quantities of cheap, standardised products. Our competition therefore is of the keenest, and is likely to grow more intense, if, as seems likely, Germany recovers from the effects of this war. Less keen is our competition with Great Britain. Like an old firm, grown rich and conservative, Great Britain is not pushing, not scientific, not well organised. We are gaining on her in those branches of manufacture which permit standardisation and production in huge quantities, and have no hope, and but little wish, of competing in articles of high finish and therefore high labour cost. With France we compete still less, since much of her export trade is in articles of taste and luxury, in which we are hopelessly inferior.[10 - See an analysis—let us say of Argentine trade.]

In this battle for the world market, the United States has the disadvantage of coming late and of being intellectually unprepared. On the other hand, not only have we superior natural resources, but also the advantage that to us success is not vital. Whatever trade we gain is a mere improvement of a situation already good. We are playing "on velvet." Finally, like Germany, we have the advantage of large scale production by strong corporations working with what is practically a bounty upon exports. Because of their control of a protected home market, our great corporations can make their sales at home cover all initial and constant costs, and as these costs need not be applied to exports, are able to sell goods cheaper in Rio Janeiro or Lima than in Chicago or New York. They are able to "dump" their surplus goods.[11 - On the other hand the very extension of our home market tends to make us negligent of foreign exports of manufactures and to consider the profits from this business as a mere by-product. A large and successful foreign market can be maintained only by careful study and continuous work.]

The opening of the Panama Canal cannot but increase the competition of the United States especially with the nations bordering on the Pacific Ocean. From 1897-1901 to 1907-11 the average annual exports from the United States to these Pacific countries (Mexico, Central America and Columbia, the remaining West Coast of South America, China, Japan, the Philippines and British Australasia) increased from 104.2 millions to 200.2 millions, a growth of 92.1 per cent., while the export from Germany increased 81.0 per cent. and from the United Kingdom only 51.7 per cent. In the same period our average annual imports from these countries increased 112.9 per cent. (as compared with 113.9 per cent. for Germany and 62.5 per cent. for the United Kingdom).[12 - Hutchinson (Lincoln), "The Panama Canal and International Trade Competition," p. 105 et seq. New York, 1915.] The trade with these Pacific countries lies largely with the United Kingdom, the United States and Germany (in the order named) and the United States seems to be slowly moving forward to first place.[13 - Despite the fact that as yet the absolute increase is greater in the British than in the American trade with these countries.] What progress the United States has made, moreover, has been achieved under certain great disabilities which the Panama Canal removes. "By present all-sea routes New York is, in general, at a disadvantage compared with Liverpool."[14 - Hutchinson (Lincoln), op. cit.] New York by the Suez route is 3 days further away from Australasia (for ten knot vessels) than is Liverpool; by the Panama route New York is from 9 to 12 days nearer. For points on the west coast of North and South America, New York is one and a half days nearer than is Liverpool by the all-sea route and about eleven days nearer by the Panama route. When all the conditions of distance, speed, cost of coal, tolls, etc., are considered, it is found that the Panama Canal gives in many parts of the world an advantage to New York over Liverpool, Antwerp and Hamburg. The result is an impulse towards a keener American competition in the Pacific trade.

If our foreign commerce was gaining before the war, it has made even greater progress since the outbreak of hostilities. While Germany's foreign commerce has been temporarily destroyed and that of Great Britain has been hampered by the war, our total commerce has immensely increased. In the year 1915 we exported over a billion dollars in excess of our exports of 1913, our exports in the latter year exceeding those of the United Kingdom or of any other country in any year of its history.[15 - From 1914 to 1916 our exports of merchandise increased from 2365 to 4334 millions of dollars (an increase of 83 per cent.) and our balance of exports over imports rose from 471 to 2136 millions (an increase of 354 per cent.). Monthly Summary of Foreign Commerce of the United States, June, 1916. (Corrected to Aug. 9, 1916, subject to revision.)] This development, it is true, was abnormal and consisted partly in increases in prices and temporary deflections in trade. Nevertheless, while many American industries, especially those engaged in the manufacture of war munitions, will suffer severely at the end of the war, and while our export of such commodities will dwindle, the war cannot but result in a relative advantage to American manufacturers of export commodities.

Moreover, the war by destroying established connections between neutral countries and their natural purveyors of manufactured goods in Europe has opened the way to a future extension of American export. Like a protective tariff, it gives an initial advantage to Americans, and helps them to overcome the early handicaps. It induces American manufacturers to think in terms of foreign markets instead of concentrating their attention upon a protected home market. In the beginning, it is true, the buying capacity of certain countries, such as those of South America, was diminished by the shattering of financial arrangements with Europe. But such a condition is purely temporary. There will always be a demand for the wheat, corn, meats, hides and wool of Argentine, for the copper and nitrates of Chile, for the coffee and rubber of Brazil, for the wool of Uruguay, for the sugar and cotton of Peru, for the tin of Bolivia, for the beef and tagua nuts of Venezuela and Colombia. So long as they sell raw materials, these countries will furnish a demand for finished products.

American manufacturers are to-day determined to secure an increased share of this expanding market.[16 - "In spite of inexperience, crude methods, lack of banks and of ships we have made notable gains in South American trade. There seems to be no reason to question the probability of a continued rapid increase during the next few years.... The process of building and making more efficient our own manufacturing plants has been carried far, so that we are prepared, in the opinion of competent judges, to proceed more rapidly than ever with the production of goods for foreign markets."—William H. Lough, "Banking Opportunities in South America," Bureau of Foreign and Domestic Commerce (Dept. of Commerce), Special Agents Series No. 106, Washington, 1915, p. 7.] They are slowly learning that you cannot push your goods, in South America let us say, unless you learn to pack your goods, have studied local requirements, are willing to print catalogues in Spanish and Portuguese, and have your salesmen know these languages. In the past Americans have been hampered by their unwillingness or inability to extend long credits, but this drawback is being removed by the improvement of banking facilities. The government, moreover, now seeks actively to promote American trade with foreign countries, and especially with Latin America. A new merchant marine is expected to give additional facilities to American exporters and enable them to meet their British and German competitors on more nearly equal terms. Moreover, the United States is learning that in the export trade co-operation is desirable, and the Federal Trade Commission seems about to grant permission to manufacturers to combine for the conduct of business in foreign countries.[17 - In a recent address (see date) to the American Iron and Steel Industry, Mr. Edwin W. Hurley, vice-chairman of the Federal Trade Commission, points out how during the last quarter of a century the Germans have co-ordinated their foreign trade, with the result that of the steel business 90 per cent. has been brought under a single control. The effect has been a victory for the German over the British export business. Mr. Hurley states that while a constructive programme has been worked out by the Interstate Commerce Commission for the railroads, and co-operation among the farmers has been stimulated by the Department of Agriculture, the manufacturing industries concerned in the export trade are hampered by provisions of the Anti-Trust Law. "Is it reasonable to suppose," he asks, "that Congress meant to obstruct the development of our foreign commerce by forbidding the use in export trade of methods of organisation which do not operate to the prejudice of the American public, are lawful in the countries where the trade is to be carried on, and are necessary if Americans are to meet competitors there on equal terms?"—New York Evening Sun, June 21, 1916.]

All this does not mean that American manufacturers are completely to displace their European competitors in South America and other markets. Competition after the war will be severe, and whatever the course of wages and employment in Europe, a measure of success for industrial countries like Great Britain, Germany and Belgium is absolutely essential to the maintenance of their populations. Desperate efforts will be made by these nations to re-establish their foreign business. A great part of South America is as near to London and Rotterdam as to New York, and much of the trade and of its future increase will revert to Europe. In the years to come, however, more than in the present or past, the United States will be a formidable competitor for the world-markets, and will incur enmity and jealousy in the attempt to maintain and improve its position.

A similar development is taking place in the field of investment. In former years, British, French, Dutch, Belgian and German financiers were requested, indeed begged, to invest their surplus capital in American enterprises. To these financiers we went cap in hand, and they did not lend their money cheaply. The complementary relation between lending Europe and borrowing America was productive of the friendship of mutual benefit. To-day we are still a debtor nation, but only in the sense that the great financier is a debtor. We ourselves have a large capital, and in the main go to Europe merely for the sale of safer and less remunerative bonds, while the common stock of new enterprises is likely to remain in America. Or we graciously "let Europe in on a good thing," conferring, not asking, a favour. In the meantime, we are paying off our indebtedness as is indicated by the balance of trade, which since 1876 has almost invariably been strongly in our favour.[18 - In the last forty years the balance has been against us in only three years, 1888, 1889 and 1893. The real balance is not nearly so great as the apparent balance, but there can be little doubt that it represents a considerable repayment of the principal of our great debt to Europe.]

The war has still further reduced our foreign obligations. During the two years ending June 30, 1916 our excess of exports over imports was over three and one-quarter billions of dollars. Moreover, in 1915 we did not incur, as ordinarily, a large debt as a result of the expenditures of Americans in Europe. The result of this development has been twofold; a considerable transfer of European holdings of American securities to Americans, and the direct loan of American capital to Europe. While it is impossible to quote exact figures, the American debt to Europe can hardly have been reduced during the two years ending August 1, 1916, by less than two to two and a half billions, or perhaps a third, or even a half, of our former debt to Europe.[19 - According to W. Z. Ripley the American debt to Europe amounted in 1899 to $3,100,000,000 of which $2,500,000,000 was owed to England, $240,000,000 to Holland, $200,000,000 to Germany, $75,000,000 to Switzerland, $50,000,000 to France, and $35,000,000 to the rest of Europe. After 1899 there was a reduction in the amount of European holdings of American securities (mostly railroad bonds and stocks), but since 1907 there was again an increased purchase, so that by 1914 the American debt to Europe was considerably greater than it had been in 1899. See New York Journal of Commerce, Dec. 6, 1911. Also, Hobson, C. K., "The Export of Capital." New York, 1914, p. 153-5. According to a compilation made by President L. F. Loree of the Delaware and Hudson Railroad, the American railroad securities formerly held in foreign hands but which were absorbed by the American market during the eighteen months ending July 31, 1916, amounted to $1,288,773,801 par value and to $898,390,910 market value. The railroad securities remaining abroad (July 31, 1916), amounted to $1,415,628,563 par value with a market value of $1,110,099,090. In other words according to these statistics of returned securities (which Mr. Loree believes are largely underestimated) about 45 per cent. (market value) of the railroad securities held abroad on January 31, 1915, had been returned eighteen months later. (New York Times, Sept. 25, 1916.) The New York Times states that "it is high banking opinion that at the outbreak of the war, the total of industrial securities held abroad amounted to about 25 per cent. of the railroad securities, and that the liquidation of industrials since has been in about the same proportion to the total as the liquidation of rails." On this basis the foreign holdings of American railroad and industrial securities on July 31, 1916, would have amounted to only $1,375,000,000 (market value).]

In the meantime the United States though still a debtor nation has also become a creditor nation. Just as Germany, before the war, borrowed from France and loaned to Bulgaria and Turkey, so the United States, while still owing Europe, invested in Mexico, Canada and South America. It is probable that by 1914 considerably over one and a quarter billion dollars of American capital was invested in Canada, Mexico, Cuba and the Republics of Central and South America, not including the capital represented by the Panama Canal.[20 - For data used as the basis of this estimate, see Hobson, C. K., "Export of Capital" (p. 153 and following), together with sources there cited.]

Even to-day (Nov. 1, 1916) there is still a probable excess of our debts over our credits with foreign nations of at least two billions of dollars. In comparison with our total wealth, however (estimated by the census of 1910 at 207 billions and since then largely increased), this indebtedness seems comparatively small. The national income is rapidly expanding and as the chance to secure exceptionally large profits in railroad and industrial enterprises diminishes there is an increased temptation for surplus capital to flow abroad. Whether or not we shall again have recourse to the fund of European capital in developing our immense resources, it is hardly to be doubted that we shall increasingly invest in foreign countries, and especially in Mexico, and elsewhere in the Americas.[21 - "The adoption of the Federal reserve system has … released and made available for other forms of financing great sums which were formerly tied up in scattered reserves. We have only to look at the monetary history of the German Empire during the last forty years to see how powerful an influence on industry, trade, and investment is exerted by the centralisation and control of bank reserves. The London Statist has calculated the ultimate increased lending power of American banks, under the Federal reserve system, at $3,000,000,000."—Lough, op. cit., p. 8.]

Such a development is entirely legitimate and within bounds desirable both for the United States and to the countries to which our capital (and trade) will go. The possible field of investment in Latin America and the Orient, to say nothing of other regions, is still immensely great, and as capital develops these areas their international trade will also grow. There is no reason why the United States should not take its part both in the investment of capital and the development of trade with these non-industrial countries.

As we so invest and trade, however, we must recognise the direction in which our policy is leading us and the dangers, both from within and without, that we are liable to incur. The more we invest the more we shall come into competition with the investing nations of Europe. We are already urged to put capital into South America on the just plea that trade follows investment, and the same forces that are pushing our trade outward will seek opportunities for investment in the mines and railroads of the politically backward countries. Like European nations, we too shall seek for valuable concessions, and may be tempted (and herein lies the danger) to use political pressure to secure investment opportunities. What happened in Morocco, Persia, Egypt, where the financial interests of rival nations brought them to the verge of war, may occur in Mexico, Venezuela or Colombia, and the United States may be one of the parties involved.

We seem thus to be entering upon an economic competition not entirely unlike that which existed between Germany and England. We too have gone over to a policy of extending our foreign markets and of protecting our foreign investments. More and more we shall be interested in politically and industrially backward countries, to which we shall sell and in which we shall invest. Inevitably we shall face outwards. We shall not be permitted by our own financiers, manufacturers and merchants, to say nothing of those of Europe, to hold completely aloof. We have seen, even in the present Mexican crisis, how American investment tended to precipitate a conflict. We have learned the same lesson from England, France and Germany. As we expand both industrially and financially beyond our political borders we are placed in new, difficult and complicated international relations, and are forced to determine for ourselves the rôle that America must play in this great development. We can no longer stand aside and do nothing, for that is the worst and most dangerous of policies. We must either plunge into national competitive imperialism, with all its profits and dangers, following our financiers wherever they lead, or must seek out some method by which the economic needs and desires of rival industrial nations may be compromised and appeased, so that foreign trade may go on and capital develop backward lands without the interested nations flying at each other's throat. Isolation, aloofness, a hermit life among the nations is no longer safe or possible. Whatever our decision the United States must face the new problem that presents itself, the problem of the economic expansion of the industrial nations throughout the world.




PART II

THE ROOT OF IMPERIALISM





CHAPTER VI

THE INTEGRATION OF THE WORLD


For decades, the foreign and domestic policies of the United States were determined by our ambition to subdue and people a wilderness. Our immediate profit, our ultimate destiny, our ideals of liberty, democracy and world influence, were all involved in this one effort. To us the problem was one of national growth. To-day we are beginning to realise that this Western movement of ours affected all industrial nations, and was only a part of a vaster world movement—an economic revolution, which has been developing for more than a century. That revolution is the opening up of distant agricultural lands and the binding of agricultural and industrial nations into one great economic union. It is a world integration.

To this world development the crude physical hunger of the Western populations has contributed. The urbane Chinese official, who voices the sentiments of Mr. Lowes Dickinson, attributes Europe's solicitous interference in China to the fact that the Western World cannot live alone. "Economically," he says, "your (Western) society is so constituted that it is constantly on the verge of starvation. You cannot produce what you need to consume, nor consume what you need to produce. It is matter of life and death to you to find markets in which you may dispose of your manufactures, and from which you may derive your food and raw material. Such a market China is, or might be; and the opening of this market is in fact the motive, thinly disguised, of all your dealings with us in recent years. The justice and morality of such a policy I do not propose to discuss. It is, in fact, the product of sheer material necessity, and upon such a ground it is idle to dispute."[22 - "Letters from a Chinese Official. Being an Eastern View of Western Civilisation." New York (McClure, Phillips & Co.), 1903, p. 13.]

Necessity is a large and a vague word; it may mean any degree of compulsion or freedom. Yet the Chinese official is right when he emphasises the immensity of the economic forces driving the Western nations outward. Not adventure, ambition or religious propagandism will account for the full momentum of this movement. Back of the missionaries, traders, soldiers, financiers, diplomats, who are opening up "backward" countries stand hundreds of millions of people, whose primary daily needs make them unconscious imperialists.

At the bottom this outward driving force is the breeding impulse, the growth of population. In 1800, one hundred and twenty-two millions of people lived in western Europe, whereas in 1900 the population was two hundred and forty millions,[23 - See "Handwörterbuch der Staatswissenschaften," II, pp. 992, 993, Third edition, Jena, 1909-1911. Western Europe here includes all of Europe except Russia, Hungary, Bosnia and Herzegovina, the Balkan States and Turkey.] and the rate of increase is still rapid. The population has doubled; the area has remained the same. The new millions cannot be fed or clothed according to their present standard of living unless food and raw materials come from abroad. They depend for their existence on outside agricultural countries.

This increase of European population, moreover, has been a net increase, after emigration has been deducted. Although during the last century tens of millions of immigrants have gone from western Europe to the United States, Canada, Brazil and the Argentine; the home population has increased by over one hundred and seventeen millions and is to-day increasing by twenty millions a decade.[24 - The absolute increase in the population of western Europe is itself increasing. In the decade 1800-1810, the increase was 6.3 millions; in the nine succeeding decades it was 7.8; 13.5; 11.3; 9.6; 9.7; 11.5; 14.1; 14.5 and 19.0 millions. In the fifty years ending 1850 the population increased 48.6 millions; in the fifty years ending 1900, 68.7 millions.] For all of these twenty millions no sufficient outlet can be found either in old or in new lands. The problem, therefore, is not to find homes for them abroad but to secure their existence at home. And this existence can only be secured by raising the necessary food in distant agricultural countries and by turning over a large part of western Europe to manufacturing and commercial enterprises. Colonisation, imperialism, the opening up of new agricultural countries, is therefore the other side of industrialism.

The present revolution in the world to-day is thus in a real sense a sequel to the industrial revolution, which gave birth to our modern industry. That imposing industry depends upon non-industrial populations, who produce food, cotton, wood and copper, and exchange them for manufactured goods. Since the people who fashion and transport products must be fed by those who raise them, agricultural production must be stimulated at home and abroad. The nation must expand economically. This expansion, which is broader than what is usually called imperialism, is not a merely political process. It takes small account of national boundaries, but develops farming wherever possible.

The movement is vast and intricate: Commerce between industry and agriculture is carried to the outermost parts of the earth; Africa is divided up, colonies, dependencies and protectorates are acquired; agriculture is promoted in politically independent countries, and an internal colonisation, a colonisation within one's own country, occurs simultaneously. In Australia, the Canadian West, in Argentine, in Siberia settlers lay virgin fields under the plough, and the new lands are bound commercially to the great complex of Western industrial nations.

They are also bound psychologically. As the machine which conquered the nation now conquers the world, so the spirit of Manchester and London and of Pittsburgh and New York rules ancient peoples, breaking up their rigid civilisations, as it rules naked savages in the Congo forests. It is a materialistic, rationalistic, machine-worshipping spirit. The unconscious Christian missionaries to China, who teach the natives not to smoke opium and not to bind the feet of their women, are unwittingly introducing conceptions of life, as hostile to traditional Christianity as to Confucianism or Buddhism. They are teaching the gospel of steam, the eternal verities of mechanics, and the true doctrine of pounds, shillings and pence. Feudalism, conservatism, family piety, are dissolved; and, as the conquering mobile civilisations impinge upon quiescent peoples, new ambitions and desires are created among populations hitherto content to live as their forefathers lived. These desires are the inlet of the restless discontent which we call European civilisation. When the ancient peoples, civilised or not, desire guns, whiskey, cotton goods, watches and lamps, their dependence upon Western civilisation is assured. Bound to the industrial nations, they toil in mines or on tropical plantations that they may buy the goods they have learned to want, and that Europe may live.

In this cosmopolitan division of labour, which destroys the old economic self-sufficiency of nations, England took the lead. A hundred years ago, when the British agriculturist sold his produce to the British manufacturer in return for finished wares, and foreign commerce was insignificant, the population was limited by the food it could produce. Every increase in the number of Englishmen meant recourse to less fertile fields, an increase in rents, a lowering of wages and a resultant pauperism. The hideous distress during the Napoleonic Wars and after was largely due to an excessive population striving to live upon narrow agricultural resources.

The alternative presented was to stop bearing children or find food abroad; stagnation or industrialism. If England (with Wales) could in 1821 barely support twelve millions, how could she maintain thirty-six millions in 1911? Only by going over to free trade, by raising her food and raw materials in countries where land was cheap, and employing her people in converting these into finished products. To-day three live in England better than one lived before; on the other hand, a large part of the food supply is raised abroad.




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notes



1


Ernest Barker. Crusades. Encyclopedia Britannica, Eleventh Edition, Vol. VII, p. 526.




2


For a sketch of the economic influences bearing upon war, see the brilliant essay of Prof. Edward Van Dyke Robinson, "War and Economics in History and Theory," Political Science Quarterly, Vol. XV, pp. 581-622. Reproduced in "Sociology and Social Progress," compiled by Prof. Thomas Nixon Carver (1905), pp. 133-173. In the present chapter I have borrowed extensively from Professor Robinson's essay.




3


"Early in the year 1901, a foreign ambassador at Washington remarked in the course of a conversation that, although he had been in America only a short time, he had seen two different countries, the United States before the war with Spain, and the United States since the war with Spain. This was a picturesque way of expressing the truth, now generally accepted, that the war of 1898 was a turning point in the history of the American republic."—"The United States as a World Power," by Archibald Gary Coolidge. New York, 1912.




4


For a study of these strategic considerations see "The Interest of America in Sea Power, Present and Future," by Captain (later Rear-Admiral) A. T. Mahan, a series of articles written between 1890 and 1897. Boston, 1911.




5


John A. Hobson, "Imperialism," p. 23. London, 1902.




6


Op. cit., p. 83.




7


In 1914, twenty-six years after the cession of the islands our combined import to and export from the Philippines amounted to only $51,246,128, or less than 1/75 of our entire foreign commerce. Our commerce with China, which was to have been opened by our possession of the Philippines was less than one-half of that with Brazil and less than one-twelfth of that with Great Britain.




8


"At the beginning of the war (with Spain) there was perhaps not a soul in the whole Republic who so much as thought of the possibility of this nation becoming a sovereign power in the Orient."—"World Politics," by Prof. Paul I. Reinsch, New York, 1913, p. 64.




9


This comparison is not exact, since the British statistics include articles under manufactures which we do not include, and exclude articles which we include. I cite these figures merely to show that there is a vast difference in the relative importance to the United Kingdom and the United States of their export of manufactures, but not to show exactly what that difference is. Similarly the comparison above between the total product of American manufacturing and our export of manufactures is approximate.




10


See an analysis—let us say of Argentine trade.




11


On the other hand the very extension of our home market tends to make us negligent of foreign exports of manufactures and to consider the profits from this business as a mere by-product. A large and successful foreign market can be maintained only by careful study and continuous work.




12


Hutchinson (Lincoln), "The Panama Canal and International Trade Competition," p. 105 et seq. New York, 1915.




13


Despite the fact that as yet the absolute increase is greater in the British than in the American trade with these countries.




14


Hutchinson (Lincoln), op. cit.




15


From 1914 to 1916 our exports of merchandise increased from 2365 to 4334 millions of dollars (an increase of 83 per cent.) and our balance of exports over imports rose from 471 to 2136 millions (an increase of 354 per cent.). Monthly Summary of Foreign Commerce of the United States, June, 1916. (Corrected to Aug. 9, 1916, subject to revision.)




16


"In spite of inexperience, crude methods, lack of banks and of ships we have made notable gains in South American trade. There seems to be no reason to question the probability of a continued rapid increase during the next few years.... The process of building and making more efficient our own manufacturing plants has been carried far, so that we are prepared, in the opinion of competent judges, to proceed more rapidly than ever with the production of goods for foreign markets."—William H. Lough, "Banking Opportunities in South America," Bureau of Foreign and Domestic Commerce (Dept. of Commerce), Special Agents Series No. 106, Washington, 1915, p. 7.




17


In a recent address (see date) to the American Iron and Steel Industry, Mr. Edwin W. Hurley, vice-chairman of the Federal Trade Commission, points out how during the last quarter of a century the Germans have co-ordinated their foreign trade, with the result that of the steel business 90 per cent. has been brought under a single control. The effect has been a victory for the German over the British export business. Mr. Hurley states that while a constructive programme has been worked out by the Interstate Commerce Commission for the railroads, and co-operation among the farmers has been stimulated by the Department of Agriculture, the manufacturing industries concerned in the export trade are hampered by provisions of the Anti-Trust Law. "Is it reasonable to suppose," he asks, "that Congress meant to obstruct the development of our foreign commerce by forbidding the use in export trade of methods of organisation which do not operate to the prejudice of the American public, are lawful in the countries where the trade is to be carried on, and are necessary if Americans are to meet competitors there on equal terms?"—New York Evening Sun, June 21, 1916.




18


In the last forty years the balance has been against us in only three years, 1888, 1889 and 1893. The real balance is not nearly so great as the apparent balance, but there can be little doubt that it represents a considerable repayment of the principal of our great debt to Europe.




19


According to W. Z. Ripley the American debt to Europe amounted in 1899 to $3,100,000,000 of which $2,500,000,000 was owed to England, $240,000,000 to Holland, $200,000,000 to Germany, $75,000,000 to Switzerland, $50,000,000 to France, and $35,000,000 to the rest of Europe. After 1899 there was a reduction in the amount of European holdings of American securities (mostly railroad bonds and stocks), but since 1907 there was again an increased purchase, so that by 1914 the American debt to Europe was considerably greater than it had been in 1899. See New York Journal of Commerce, Dec. 6, 1911. Also, Hobson, C. K., "The Export of Capital." New York, 1914, p. 153-5. According to a compilation made by President L. F. Loree of the Delaware and Hudson Railroad, the American railroad securities formerly held in foreign hands but which were absorbed by the American market during the eighteen months ending July 31, 1916, amounted to $1,288,773,801 par value and to $898,390,910 market value. The railroad securities remaining abroad (July 31, 1916), amounted to $1,415,628,563 par value with a market value of $1,110,099,090. In other words according to these statistics of returned securities (which Mr. Loree believes are largely underestimated) about 45 per cent. (market value) of the railroad securities held abroad on January 31, 1915, had been returned eighteen months later. (New York Times, Sept. 25, 1916.) The New York Times states that "it is high banking opinion that at the outbreak of the war, the total of industrial securities held abroad amounted to about 25 per cent. of the railroad securities, and that the liquidation of industrials since has been in about the same proportion to the total as the liquidation of rails." On this basis the foreign holdings of American railroad and industrial securities on July 31, 1916, would have amounted to only $1,375,000,000 (market value).




20


For data used as the basis of this estimate, see Hobson, C. K., "Export of Capital" (p. 153 and following), together with sources there cited.




21


"The adoption of the Federal reserve system has … released and made available for other forms of financing great sums which were formerly tied up in scattered reserves. We have only to look at the monetary history of the German Empire during the last forty years to see how powerful an influence on industry, trade, and investment is exerted by the centralisation and control of bank reserves. The London Statist has calculated the ultimate increased lending power of American banks, under the Federal reserve system, at $3,000,000,000."—Lough, op. cit., p. 8.




22


"Letters from a Chinese Official. Being an Eastern View of Western Civilisation." New York (McClure, Phillips & Co.), 1903, p. 13.




23


See "Handwörterbuch der Staatswissenschaften," II, pp. 992, 993, Third edition, Jena, 1909-1911. Western Europe here includes all of Europe except Russia, Hungary, Bosnia and Herzegovina, the Balkan States and Turkey.




24


The absolute increase in the population of western Europe is itself increasing. In the decade 1800-1810, the increase was 6.3 millions; in the nine succeeding decades it was 7.8; 13.5; 11.3; 9.6; 9.7; 11.5; 14.1; 14.5 and 19.0 millions. In the fifty years ending 1850 the population increased 48.6 millions; in the fifty years ending 1900, 68.7 millions.