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+The Project Gutenberg eBook of The American Empire, by Scott Nearing
+
+
+This eBook is for the use of anyone anywhere at no cost and with
+almost no restrictions whatsoever.  You may copy it, give it away or
+re-use it under the terms of the Project Gutenberg License included
+with this eBook or online at www.gutenberg.org
+
+
+
+
+
+Title: The American Empire
+
+
+Author: Scott Nearing
+
+
+
+Release Date: January 12, 2009  [eBook #27787]
+
+Language: English
+
+Character set encoding: ISO-8859-1
+
+
+***START OF THE PROJECT GUTENBERG EBOOK THE AMERICAN EMPIRE***
+
+
+E-text prepared by Peter Vachuska, Martin Pettit, and the Project
+Gutenberg Online Distributed Proofreading Team (http://www.pgdp.net)
+
+
+
+THE AMERICAN EMPIRE
+
+by
+
+SCOTT NEARING
+
+Author of
+"Wages in the United States"
+"Income"
+"Financing the Wage-Earner's Family"
+"Anthracite"
+"Poverty and Riches," etc.
+
+
+
+
+
+
+
+New York
+The Rand School of Social Science
+7 East 15th Street
+1921
+
+All rights reserved
+
+Copyright, 1921,
+by the
+Rand School of Social Science
+
+First Edition, January, 1921
+Second Edition, February, 1921
+
+
+
+
+CONTENTS
+
+
+PART I
+
+WHAT IS AMERICA?
+
+CHAPTER                                            PAGE
+
+    I The Promise of 1776                             7
+
+   II The Course of Empire                           14
+
+
+PART II
+
+THE FOUNDATIONS OF EMPIRE.
+
+A. THE CONQUEST OF AMERICA.
+
+  III Subjugating the Indians                        26
+
+   IV Slavery for a Race                             38
+
+    V Winning the West                               49
+
+   VI The Beginnings of World Dominion               60
+
+B. PLUTOCRACY.
+
+  VII The Struggle for Wealth and Power              74
+
+ VIII Their United States                            88
+
+   IX The Divine Right of Property                  103
+
+
+PART III
+
+MANIFEST DESTINY.
+
+    X Industrial Empires                            120
+
+   XI The Great War                                 143
+
+  XII The Imperial Highroad                         158
+
+
+PART IV
+
+THE UNITED STATES--A WORLD EMPIRE.
+
+ XIII The United States as a World Competitor       177
+
+  XIV The Partition of the Earth                    192
+
+   XV Pan-Americanism                               202
+
+  XVI The American Capitalist and World Empire      218
+
+
+PART V
+
+THE CHALLENGE TO IMPERIALISM.
+
+ XVII The New Imperial Alignment                    229
+
+XVIII The Challenge in Europe                       243
+
+  XIX The American Worker and World Empire          256
+
+
+
+
+The American Empire
+
+
+
+
+I. THE PROMISE OF 1776
+
+
+1. _The American Republic_
+
+The genius of revolution presided at the birth of the American Republic,
+whose first breath was drawn amid the economic, social and political
+turmoil of the eighteenth century. The voyaging and discovering of the
+three preceding centuries had destroyed European isolation and laid the
+foundation for a new world order of society. The Industrial Revolution
+was convulsing England and threatening to destroy the Feudal State.
+Western civilization, in the birthpangs of social revolution, produced
+first the American and then the French Republic.
+
+Feudalism was dying! Divine right, monarchy, aristocracy, oppression,
+despotism, tyranny--these and all other devils of the old world order
+were bound for the limbo which awaits outworn, discredited social
+institutions. The Declaration of Independence officially proclaimed the
+new order,--challenging "divine right" and maintaining that "all men are
+created equal; that they are endowed by their Creator with certain
+unalienable rights; that among these are life, liberty and the pursuit
+of happiness. That to secure these rights, governments are instituted
+among men, deriving their just powers from the consent of the governed."
+
+Life, liberty and happiness were the heritage of the human race, and
+"whenever any form of government becomes destructive of these ends, it
+is the right of the people to alter or abolish it, and to institute a
+new government laying its foundations on such principles, and organizing
+its powers in such form, as to them shall seem likely to effect their
+safety and happiness."
+
+Thus the rights of the people were declared superior to the privileges
+of the rulers; revolution was justified; and the principles of
+eighteenth century individualism were made the foundation of the new
+political state. Aristocracy was swept aside and in its stead democracy
+was enthroned.
+
+
+2. _The Yearning for Liberty_
+
+The nineteenth century re-echoed with the language of social idealism.
+Traditional bonds were breaking; men's minds were freed; their
+imaginations were kindled; their spirits were possessed by a gnawing
+hunger for justice and truth.
+
+Revolting millions shouted: "Liberty, Equality, Fraternity!" Sages
+mused; philosophers analyzed; prophets exhorted; statesmen organized
+toward this end.
+
+Men felt the fire of the new order burning in their vitals. It purged
+them. They looked into the eyes of their fellows and saw its reflection.
+Dreaming of liberty as a maiden dreams of her lover, humanity awoke
+suddenly, to find liberty on the threshold.
+
+Through the ages mankind has sought truth and justice. Vested interests
+have intervened. The powers of the established order have resisted, but
+the search has continued. That eternal vigilance and eternal sacrifice
+which are the price of liberty, are found wherever human society has
+left a record. At one point the forces of light seem to be winning. At
+another, liberty and truth are being ruthlessly crushed by the
+privileged masters of life. The struggle goes on--eternally.
+
+Liberty and justice are ideals that exist in the human heart, but they
+are none the less real. Indeed, they are in a sense more potent, lying
+thus in immortal embryo, than they could be as tangible institutions.
+Institutions are brought into being, perfected, kept past their time of
+highest usefulness and finally discarded. The hopes of men spring
+eternally, spontaneously. They are the true social immortality.
+
+
+3. _Government of the People_
+
+Feudalism as a means of organizing society had failed. The newly
+declared liberties were confided to the newly created state. It was
+political democracy upon which the founders of the Republic depended to
+make good the promise of 1776.
+
+The American colonists had fled to escape economic, political and
+religious tyranny in the mother countries. They had drunk the cup of its
+bitterness in the long contest with England over the rights of taxation,
+of commerce, of manufacture, and of local political control. They had
+their fill of a mastery built upon the special privilege of an
+aristocratic minority. It was liberty and justice they sought and
+democracy was the instrument that they selected to emancipate themselves
+from the old forms of privilege and to give to all an equal opportunity
+for life, liberty and the pursuit of happiness.
+
+Political democracy was to place the management of community business in
+the hands of the people--to give them liberty in the control of public
+affairs. The highest interest of democracy was to be the interest of the
+people. There could be no higher interest because the people were
+supreme. The people were to select the public servants; direct their
+activities; determine public policy; prescribe the law; demand its
+enforcement; and if need be assert their superior authority over any
+part of the government, not excepting the constitution.[1]
+
+Democracy, in politics, was based on the idea that public affairs could
+best be run by the public voice. However expert may be the hand that
+administers the laws, the hand and the heart that renders the final
+decision in large questions must belong to the public.[2]
+
+The people who laid the foundations for democracy in France and the
+United States feared tyranny. They and their ancestors had been, for
+centuries, the victims of governmental despotism. They were on their
+guard constantly against governmental aggression in any form. And they,
+therefore, placed the strictest limitations upon the powers that
+governments should enjoy.
+
+Special privilege government was run by a special class,--the hereditary
+aristocracy--in the interest and for the profit of that class. They held
+the wealth of the nation--the land--and lived comfortably upon its
+produce. They never worked--no gentleman could work and remain a
+gentleman. They carried on the affairs of the court--sometimes well,
+sometimes badly; maintained an extravagant scale of social life; built
+up a vicious system of secret international diplomacy; commanded in time
+of war, and at all times; levied rents and taxes which went very largely
+to increase their own comfort and better their own position in life. The
+machinery of government and the profits from government remained in the
+hands of this one class.
+
+Class government from its very nature could not be other than
+oppressive. "All hereditary government over a people is to them a
+species of slavery and representative government is freedom." "All
+hereditary government is in its nature tyranny.... To inherit a
+government is to inherit the people as if they were flocks and
+herds."[3]
+
+
+4. _The Source of Authority_
+
+The people were to be the source of authority in the new state. The
+citizen was to have a voice because he was an adult, capable of
+rendering judgment in the selection of public servants and in the
+determination of public policy.
+
+All through history there had been men into whose hands supreme power
+had been committed, who had carried this authority with an astounding
+degree of wisdom and integrity. For every one who had comported himself
+with such wisdom in the presence of supreme authority, there were a
+score, or more likely a hundred, who had used this power stupidly,
+foolishly, inefficiently, brutally or viciously.
+
+Few men are good enough or wise enough to keep their heads while they
+hold in their hands unlimited authority over their fellows. The pages of
+human experience were written full of the errors, failures, and abuses
+of which such men so often have been guilty.
+
+The new society, in an effort to prevent just such transgressions of
+social well being, placed the final power to decide public questions in
+the hands of the people. It was not contended, or even hoped that the
+people would make no mistakes, but that the people would make fewer
+mistakes and mistakes less destructive of public well-being than had
+been made under class government. At least this much was gained, that
+the one who abused power must first secure it from those whom he
+proposed to abuse, and must later exercise it unrestrained to the
+detriment of those from whom the power was derived and in whom it still
+resided.
+
+The citizen was to be the source of authority. His word, combined with
+that of the majority of his fellows, was final. He delegated authority.
+He assented to laws which were administered over all men, including
+himself. He accepts the authority of which he was the source.
+
+
+5. _The American Tradition_
+
+This was the American tradition. This was the language of the new, free
+world. Life, liberty and happiness; popular sovereignty; equal
+opportunity. This, to the people of the old countries was the meaning of
+America. This was the promise of 1776.
+
+When President Wilson went to Europe, speaking the language of liberty
+that is taught in every American schoolroom, the plain people turned to
+him with supreme confidence. To them he was the embodiment of the spirit
+of the West.
+
+Native-born Americans hold the same idea. To them the Declaration of
+Independence was a final break with the old order of monarchical,
+imperial Europe. It was the charter of popular rights and human
+liberties, establishing once for all the principles of self-government
+and equal opportunity.
+
+The Statue of Liberty, guarding the great port of entrance to America,
+symbolizes the spirit in which foreigners and natives alike think of
+her--as the champion of the weak and the oppressed; the guardian of
+justice; the standard-bearer of freedom.
+
+This spirit of America is treasured to-day in the hearts of millions of
+her citizens. To the masses of the American people America stands to-day
+as she always stood. They believe in her freedom; they boast of her
+liberties; they have faith in her great destiny as the leader of an
+emancipated world. They respond, as did their ancestors, to the great
+truths of liberty, equality, and fraternity that inspired the eighteenth
+century.
+
+The tradition of America is a hope, a faith, a conviction, a burning
+endeavor, centering in an ideal of liberty and justice for the human
+race.
+
+Patrick Henry voiced this ideal when, a passionate appeal for freedom
+being interrupted by cries of "Treason, treason!" he faced the objector
+with the declaration, "If this be treason, make the most of it!"
+
+Eighteenth century Europe, struggling against religious and political
+tyranny, looked to America as the land of Freedom. America to them meant
+liberty. "What Athens was in miniature, America will be in magnitude,"
+wrote Tom Paine. "The one was the wonder of the ancient world; the other
+is becoming the admiration, the model of the present." ("The Rights of
+Man," Part II, Chapter 3.) The promise of 1776 was voiced by men who
+felt a consuming passion for freedom; a divine discontent with anything
+less than the highest possible justice; a hatred of tyranny, oppression
+and every form of special privilege and vested wrong. They yearned over
+the future and hoped grandly for the human race.
+
+FOOTNOTES:
+
+[1] "It is, Sir, the people's constitution, the people's government,
+made for the people, made by the people, and answerable to the
+people."--Daniel Webster's reply to Hayne, 1830. "Speeches and
+Orations." E. P. Whipple, Boston, Little, Brown and Co., p. 257.
+
+[2] Tom Paine held ardently to this doctrine, "It is always the interest
+of a far greater number of people in a Nation to have things right than
+to let them remain wrong; and when public matters are open to debate,
+and the public judgment free, it will not decide wrong unless it decides
+too hastily!" "Rights of Man," Part II, Ch. 4.
+
+[3] "Rights of Man," Thomas Paine. Part II, Chapter 3.
+
+
+
+
+II. THE COURSE OF EMPIRE
+
+
+1. _Promise and Fulfillment_
+
+A vast gulf yawns between the inspiring promise that a handful of men
+and women made to the world in 1776, and the fulfillment of that promise
+that is embodied in twentieth century American life. The pre-war
+indifference to the loss of liberty; the gradual encroachments on the
+rights of free speech, and free assemblage and of free press; the
+war-time suppressions, tyrannies, and denials of justice; the subsequent
+activities of city, state, and national legislatures and executives in
+passing and enforcing laws that provided for military training in
+violation of conscience, the denial of freedom of belief, of thought, of
+speech, of press and of assemblage,--activities directed specifically to
+the negation of those very principles of liberty which have constituted
+so intimate a part of the American tradition of freedom,--form a
+contrast between the promise of 1776 and the twentieth century
+fulfillment of that promise which is brutal in its terrible intensity.
+
+Many thoughtful Americans have been baffled by this conflict between the
+aims of the eighteenth century and the accomplishments of the twentieth.
+The facts they admit. For explanation, either they may say, "It was the
+war," implying that with the cessation of hostilities and the return to
+a peace basis, the situation has undergone a radical change; or else
+they blame some individual or some organization for the extinction of
+American liberties.
+
+Great consequences arise from great causes. A general break-down of
+liberties cannot be attributed to individual caprice nor to a particular
+legislative or judicial act.
+
+The denial of liberty in the United States is a matter of large import.
+No mayor, governor, president, legislature, court, magnate, banker,
+corporation or trust, and no combination of these individuals and
+organizations could arbitrarily destroy the American Republic.
+Underneath personality and partisanship are working the forces which
+have stripped the American people of their essential liberties as the
+April sun strips the mountains of their snow.
+
+No one can read the history of the United States since the drafting of
+the Declaration of Independence without being struck by the complete
+transformation in the forms of American life. The Industrial Revolution
+which had gripped England for half a century, made itself felt in the
+United States after 1815. Steam, transportation, industrial development,
+city life, business organization, expansion across the continent--these
+are the factors that have made of the United States a nation utterly
+apart from the nation of which those who signed the Declaration of
+Independence and fought the Revolution dreamed.
+
+These economic changes have brought political changes. The American
+Republic has been thrust aside. Above its remains towers a mighty
+imperial structure,--the world of business,--bulwarked by usage and
+convention; safeguarded by legislation, judicial interpretation, and the
+whole power of organized society. That structure is the American
+Empire--as real to-day as the Roman Empire in the days of Julius Caesar;
+the French Empire under the Little Corporal, or the British Empire of
+the Great Commoner, William E. Gladstone.
+
+Approved or disapproved; exalted or condemned; the fact of empire must
+be evident even to the hasty observer. The student, tracing its
+ramifications, realizes that the structure has been building for
+generations.
+
+
+2. _The Characteristics of Empire_
+
+Many minds will refuse to accept the term "empire" as applied to a
+republic. Accustomed to link "empire" with "emperor," they conceive of a
+supreme hereditary ruler as an essential part of imperial life. A little
+reflection will show the inadequacy of such a concept. "The British
+Empire" is an official term, used by the British Government, although
+Great Britain is a limited monarchy, whose king has less power than the
+President of the United States. On the other hand, eastern potentates,
+who exercise absolute sway over their tiny dominions do not rule
+"empires."
+
+Recent usage has given the term "empire" a very definite meaning, which
+refers, not to an "emperor" but to certain relations between the parts
+of a political or even of an economic organization. The earlier uses of
+the word "empire" were, of course, largely political. Even in that
+political sense, however, an "empire" does not necessarily imply the
+domain of an "emperor."
+
+According to the definition appearing in the "New English Dictionary"
+wherever "supreme and extensive political dominion" is exercised "by a
+sovereign state over its dependencies" an empire exists. The empire is
+"an aggregation of subject territories ruled over by a sovereign state."
+The terms of the definition are political, but it leaves the emperor
+entirely out of account and makes an empire primarily a matter of
+organization and not of personality.
+
+During the last fifty years colonialism, the search for foreign markets,
+and the competition for the control of "undeveloped" countries has
+brought the words "empire" and "imperialism" into a new category, where
+they relate, not to the ruler--be he King or Emperor--but to the
+extension of commercial and economic interests. The "financial
+imperialism" of F. C. Howe and the "imperialism" of J. A. Hobson are
+primarily economic and only incidentally political.
+
+"Empire" conveys the idea of widespread authority, dominion, rule,
+subjugation. Formerly it referred to political power; to-day it refers
+to economic power. In either case the characteristics of empire are,--
+
+
+     1. Conquered territory.
+
+     2. Subject peoples.
+
+     3. An imperial or ruling class.
+
+     4. The exploitation of the subject peoples and the conquered
+     territory for the benefit of the ruling class.
+
+
+Wherever these four characteristics of imperial organization exist,
+there is an empire, in all of its essential features. They are the
+acid-test, by which the presence of empire may be determined.
+
+Names count for nothing. Rome was an empire, while she still called
+herself a republic. Napoleon carried on his imperial activities for
+years under the authority of Republican France. The existence of an
+empire depends, not upon the presence of an "emperor" but upon the
+presence of those facts which constitute Empire,--conquered territory;
+subject peoples; an imperial class; exploitation by and for this class.
+If these facts exist in Russia, Russia is an empire; if they are found
+in Germany, Germany is an empire; if they appear in the United States,
+the United States is an empire none the less surely,--traditions,
+aspirations and public conviction to the contrary notwithstanding.
+
+
+3. _The Preservation of Empire_
+
+The first business of an imperial class is the preservation of the
+empire to which it owes its advantages and privileges. Therefore, in its
+very essence, imperialism is opposed to popular government. "The
+greatest good to the greatest number" is the ideal that directs the life
+of a self-governing community. "The safety and happiness of the ruling
+class" is the first principle of imperial organization.
+
+Imperialism is so generally recognized and so widely accepted as a
+mortal foe of popular government that the members of an imperial class,
+just rising into power, are always careful to keep the masses of the
+people ignorant of the true course of events. This necessity explains
+the long period, in the history of many great empires, when the name and
+forms of democracy were preserved, after the imperial structure had been
+established on solid foundations. Slow changes, carefully directed and
+well disguised, are necessary to prevent outraged peoples from rising
+against an imperial order when they discover how they have been sold
+into slavery. Even with all of the safeguards, under the control of the
+ablest statesmen, Caesar frequently meets his Brutus.
+
+The love of justice; the yearning for liberty; the sense of fair play;
+the desire to extend opportunity, all operate powerfully upon those to
+whom the principles of self-government are dearest, leading them to
+sacrifice position, economic advantage, and sometimes life itself for
+the sake of the principles to which they have pledged their faith.
+
+Therein lies what is perhaps one of the most essential differences
+between popular government and empire. The former rests upon certain
+ideas of popular rights and liberties. The latter is a weapon of
+exploitation in the hands of the ruling class. Popular government lies
+in the hopes and beliefs of the people. Empire is the servant of
+ambition and the shadow of greed. Popular government has been evolved by
+the human race at an immense sacrifice during centuries of struggle
+against the forms and ideas that underly imperialism. Since men have set
+their backs on the past and turned their faces with resolute hope to the
+future, empire has repelled them, while democracy has called and
+beckoned.
+
+Empires have been made possible by "bread and circuses"; by appealing to
+an abnormally developed sense of patriotism; by the rule of might where
+largess and cajolery have failed. Rome, Germany and Britain are
+excellent examples of these three methods. In each case, millions of
+citizens have had faith in the empire, believing in its promise of glory
+and of victory; but on the other hand, this belief could be maintained
+only by a continuous propaganda--triumphs in Rome, school-books and
+"boilerplate" in Germany and England. Even then, the imperial class is
+none too secure in its privileges. Always from the abysses of popular
+discontent, there arises some Spartacus, some Liebknecht, some Smillie,
+crying that "the future belongs to the people."
+
+The imperial class, its privileges unceasingly threatened by the popular
+love of freedom--devotes not a little attention to the problem of
+"preserving law and order" by suppressing those who speak in the name of
+liberty, and by carrying on a generous advertising campaign, the object
+of which is to persuade the people of the advantages which they derive
+from imperial rule.
+
+During the earlier stages in the development of empire, the imperial
+class is able to keep itself and its designs in the background. As time
+passes, however, the power of the imperialist becomes more and more
+evident, until some great crisis forces the empire builders to step out
+into the open. They then appear as the frank apologists, spokesmen and
+defenders of the order for which they have so faithfully labored and
+from which they expect to gain so much.
+
+Finally, the ambition of some aggressive leader among the imperialists,
+or a crisis in the affairs of the empire leads to the next step--the
+appointment of a "dictator," "supreme ruler" or "emperor." This is the
+last act of the imperial drama. Henceforth, the imperial class divides
+its attention between,--
+
+
+     1. The suppression of agitation and revolt among the people at
+     home;
+
+     2. Maintaining the imperial sway over conquered territory;
+
+     3. Extending the boundaries of the empire and
+
+     4. The unending struggle between contending factions of the ruling
+     class for the right to carry on the work of exploitation at home
+     and abroad.
+
+
+4. _The Price of Empire_
+
+Since the imperial or ruling class is willing to go to any lengths in
+order to preserve the empire upon which its privileges depend, it
+follows that the price of empire must be reckoned in the losses that the
+masses of the people suffer while safeguarding the privileges of the
+few.
+
+As a matter of course, conquered and dependent people pay with their
+liberty for their incorporation into the empire that holds dominion over
+them. On any other basis, empire is unthinkable. Indeed the terms
+"dependencies," "domination," and "subject" carry with them only one
+possible implication--the subordination or extinction of the liberties
+of the peoples in question.
+
+The imperial class--a minority--depends for its continued supremacy upon
+the ownership of some form of property, whether this property be slaves,
+or land, or industrial capital. As Veblen puts it: "The emergence of the
+leisure class coincides with the beginning of ownership." ("Theory of
+the Leisure Class," T. Veblen, New York. B. W. Huebsch, 1899, p. 22.)
+Necessarily, therefore, the imperial class will sacrifice the so-called
+human or personal rights of the home population to the protection of its
+property rights. Indeed the property rights come to be regarded as the
+essential human rights, although there is but a small minority of the
+community that can boast of the possession of property.
+
+The superiority of ruling class property rights over the personal rights
+and liberties of the inhabitants in a subject territory is taken as a
+matter of course. Even in the home country, where the issue is clearly
+made, the imperial class will sacrifice the happiness, the health, the
+longevity, and the lives of the propertyless class in the interest of
+"law and order" and "the protection of property." The stories of the
+Roman populace; of the French peasants under Louis XIV; of the English
+factory workers (men, women and children) during the past hundred years,
+and of the low skilled workers in the United States since the Civil
+War, furnish ample proof of the correctness of this contention. The
+life, liberty and happiness of the individual citizen is a matter of
+small importance so long as the empire is saved.
+
+A crisis in imperial affairs is always regarded, by the ruling class, as
+a legitimate reason for curtailing the rights of the people. Under
+ordinary circumstances, the imperial class will gain rather than lose
+from the exercise of "popular liberties." Indeed, the exercise of these
+liberties is of the greatest assistance in convincing the people that
+they are enjoying freedom and thus keeping them satisfied with their
+lot. But in a period of turmoil, with men's hearts stirred, and their
+souls aflamed with conviction and idealism, there is always danger that
+the people may exercise their "unalienable right" to "alter or abolish"
+their form of government. Consequently, during a crisis, the imperial
+class takes temporary charge of popular liberties. Every great empire
+engaged in the recent war passed through such an experience. In each
+country the ruling class announced that the war was a matter of life and
+death. Papers were suppressed or censored; free speech was denied; men
+were conscripted against will and conscience; constitutions were thrust
+aside; laws "slumbered"; writers and thinkers were jailed for their
+opinions; food was rationed; industries were controlled--all in the
+interest of "winning the war." After the war was won, the victors
+practiced an even more rigorous suppression while they were "making the
+peace." Then followed months and years of protests and demands, until,
+one by one, the liberties were retaken by the people or else the
+war-tyranny, once firmly established, became a part of "the heritage of
+empire." In such cases, where liberties were not regained, the plain
+people learned to do without them.
+
+Liberty is the price of empire. Imperialism presupposes that the people
+will be willing, at any time, to surrender their "rights" at the call of
+the rulers.
+
+
+5. _The Universality of Empire_
+
+Imperialism is not new, nor is it confined to one nation or to one race.
+On the contrary it is as old as history and as wide as the world.
+
+Before Rome, there was Carthage. Before Carthage, there were Greece,
+Macedonia, Egypt, Assyria, China. Where history has a record, it is a
+record of empire.
+
+During modern times, international affairs have been dominated by
+empires. The great war was a war between empires. During the first three
+years, the two chief contestants were the British Empire on the one hand
+and the German Empire on the other. Behind these leaders were the
+Russian Empire, the Italian Empire, the French Empire, and the Japanese
+Empire.
+
+The Peace of Versailles was a peace between empires. Five empires
+dominated the peace table--Great Britain, France, Italy, Japan and the
+United States. The avowedly anti-imperial nations of Europe--Russia and
+Hungary--were not only excluded from the deliberations of the Peace
+Table, but were made the object of constant diplomatic, military and
+economic aggression by the leading imperialist nations.
+
+
+6. _The Evolution of Empire_
+
+Empires do not spring, full grown, from the surroundings of some great
+historic crisis. Rather they, like all other social institutions, are
+the result of a long series of changes that lead by degrees from the
+pre-imperial to the imperial stage. Many of the great empires of the
+past two thousand years have begun as republics, or, as they are
+sometimes called, "democracies," and the processes of transformation
+from the republican to the imperial stage have been so gradual that the
+great mass of the people were not aware that any change had occurred
+until the emperor ascended the throne.
+
+The development of empire is of necessity a slow process. There are the
+dependent people to be subjected; the territory to conquered; the
+imperial class to be built up. This last process takes, perhaps, more
+time than either of the other two. Class consciousness is not created in
+a day. It requires long experience with the exercise of imperial power
+before the time has come to proclaim an emperor, and forcibly to take
+possession of the machinery of public affairs.
+
+
+7. _The United States and the Stages of Empire_
+
+Any one who is familiar with its history will realize at once that the
+United States is passing through some of the more advanced stages in the
+development of empire. The name "Republic" still remains; the traditions
+of the Republic are cherished by millions; the republican forms are
+almost intact, but the relations of the United States to its conquered
+territory and its subject peoples; the rapid maturation of the
+plutocracy as a governing class or caste; the shamelessness of the
+exploitation in which the rulers have indulged; and the character of the
+forces that are now shaping public policy, proclaim to all the world the
+fact of empire.
+
+The chief characteristics of empire exist in the United States. Here are
+conquered territory; subject peoples; an imperial, ruling class, and the
+exploitation by that class of the people at home and abroad. During
+generations the processes of empire have been working, unobserved, in
+the United States. Through more than two centuries the American people
+have been busily laying the foundations and erecting the imperial
+structure. For the most part, they have been unconscious of the work
+that they were doing, as the dock laborer, is ordinarily unconscious of
+his part in the mechanism of industry. Consciously or unconsciously, the
+American people have reared the imperial structure, until it stands,
+to-day, imposing in its grandeur, upon the spot where many of the
+founders of the American government hoped to see a republic.
+
+The entrance of the United States into the war did not greatly alter
+the character of the forces at work, nor did it in any large degree
+change the direction in which the country was moving. Rather, it brought
+to the surface of public attention factors of American life that had
+been evolving unnoticed, for generations.
+
+The world situation created by the war compelled the American imperial
+class to come out in the open and to occupy a position that, while
+wholly inconsistent with the traditions of American life, is
+nevertheless in keeping with the demands of imperial necessity. The
+ruling class in the United States has taken a logical step and has made
+a logical stand. The masters of American life have done the only thing
+that they could do in the interests of the imperial forces that they
+represent. They are the victims, as much as were the Kaiser and the Czar
+on the one hand, and the Belgians and the Serbs on the other, of that
+imperial necessity that knows no law save the preservation of its own
+most sacred interests.
+
+Certain liberal American thinkers have taken the stand that the
+incidents of 1917-1918 were the result of the failure of the President,
+and of certain of his advisers, to follow the theories which he had
+enunciated, and to stand by the cause that he had espoused. These
+critics overlook the incidental character of the war as a factor in
+American domestic policy. The war never assumed anything like the
+importance in the United States that it did among the European
+belligerents. On the surface, it created a furore, but underneath the
+big fact staring the administration in the face was the united front of
+the business interests, and their organized demands for action. The
+far-seeing among the business men realized that the plutocratic
+structure the world over was in peril, and that the fate of the whole
+imperial régime was involved in the European struggle. The Russian
+Revolution of March 1917 was the last straw. From that time on the
+entrance of the United States into the war became a certainty as the
+only means of "saving (capitalist) civilization."
+
+The thoughtful student of the situation in the United States is not
+deceived by personalities and names. He realizes that the events of
+1917-1918 have behind them generations of causes which lead logically to
+just such results; that he is witnessing one phase of a great process in
+the life of the American nation--a process that is old in its principles
+yet ever new in its manifestations.
+
+Traditional liberties have always given way before imperial necessity.
+An examination of the situation in which the ruling class of the United
+States found itself in 1917, and of the forces that were operating to
+determine public policy, must convince even the enthusiast that the
+occurrences of 1917 and the succeeding years were the logical outcome of
+imperial necessity. To what extent that explanation will account for the
+discrepancy between the promise of 1776 and the twentieth century
+fulfillment of that promise must appear from a further examination of
+the evidence.
+
+
+
+
+III. SUBJUGATING THE INDIANS
+
+
+1. _The Conquering Peoples_
+
+The first step in the establishment of empire--the conquest of territory
+and the subjugation of the conquered populations,--was taken by the
+people of the United States at the time of their earliest settlements.
+They took the step naturally, unaffectedly, as became the sons of their
+fathers.
+
+The Spanish, French, and English who made the first settlement in North
+America were direct descendants of the tribes that have swept across
+Europe and portions of Asia during the past three or four thousand
+years. These tribes, grouped on the basis of similarity in language
+under the general term "Aryan," hold a record of conquest that fills the
+pages of written history.
+
+Hunger; the pressure of surplus population; the inrush of new hordes of
+invaders, drove them on. Ambition; the love of adventure; the lure of
+new opportunities in new lands, called them further. Meliorism,--the
+desire to better the conditions of life for themselves and for their
+children--animated them. In later years the necessity of disposing of
+surplus wealth impelled them. Driven, lured, coerced, these Aryan tribes
+have inundated the earth. Passing beyond the boundaries of Europe, they
+have crossed the seas into Africa, Asia, America and Australia.
+
+Among the Aryans, after bitter strife, the Teutons have attained
+supremacy. The "Teutonic Peoples" are "the English speaking inhabitants
+of the British Isles, the German speaking inhabitants of Germany,
+Austria-Hungary and Switzerland, the Flemish speaking inhabitants of
+Belgium, the Scandinavian inhabitants of Sweden and Norway and
+practically all of the inhabitants of Holland and Denmark."
+("Encyclopedia Britannica.")
+
+This Teutonic domination has been established only by the bitterest of
+struggles. During the time when North America was being settled, the
+English dispossessed first the Spanish and later the French. Since the
+Battle of Waterloo--won by English and German troops; and the Crimean
+War--won by British against Russian troops--the Teutonic power has gone
+unchallenged and so it remains to-day.
+
+The dominant power in the United States for nearly two centuries has
+been the English speaking power. Thus the Americans draw their
+inspiration, not only from the Aryan, but from the English speaking
+Teutons--the most aggressive and dominating group among the Aryans.
+
+Three hundred years ago the title to North America was claimed by Spain,
+France and Great Britain. The land itself was almost entirely in the
+hands of Indian tribes which held the possession that according to the
+proverb, is "nine points of the law."
+
+The period of American settlement has witnessed the rapid dispossession
+of the original holders, until, at the present time, the Indians have
+less than two per cent of the land area of the United States.[4]
+
+The conquest, by the English speaking whites, of the three million
+square miles which comprise the United States has been accomplished in a
+phenomenally short space of time. Migration; military occupation;
+appropriation of the lands taken from the "enemy;" settlement, and
+permanent exploitation--through all these stages of conquest the country
+has moved.
+
+The "Historical Register of the United States Army" (F. B. Heitman,
+Washington, Govt. Print., 1903, vol. 2, pp. 298-300) contains a list of
+114 wars in which the United States has been engaged since 1775. The
+publication likewise presents a list of 8600 battles and engagements
+incident to these 114 wars. Two of these wars were with England, one
+with Mexico and one with Spain. These, together with the Civil War and
+the War with Germany, constitute the major struggles in which the United
+States has been engaged. In addition to these six great wars there were
+the numerous wars with the Indians, the last of which (with the
+Chippewa) occurred in 1898. Some of these Indian "wars" were mere
+policing expeditions. Others, like the wars with the Northwest Indians,
+with the Seminoles and with the Apaches, lasted for years and involved a
+considerable outlay of life and money.
+
+When the Indian Wars were ended, and the handful of red men had been
+crushed by the white millions, the American Indians, once possessors of
+a hunting ground that stretched across the continent, found themselves
+in reservations, under government tutelage, or else, abandoning their
+own customs and habits of life, they accepted the "pale-face" standards
+in preference to their own well-loved traditions.
+
+The territory flanking the Mississippi Valley, with its coastal plains
+and the deposits of mineral wealth, is one of the richest in the world.
+Only two other areas, China and Russia, can compare with it in
+resources.
+
+This garden spot came into the possession of the English speaking whites
+almost without a struggle. It was as if destiny had held a door tight
+shut for centuries and suddenly had opened it to admit her chosen
+guests.
+
+History shows that such areas have almost always been held by one
+powerful nation after another, and have been the scene of ferocious
+struggles. Witness the valleys of the Euphrates, the Nile, the Danube,
+the Po and the Rhine. The barrier of the Atlantic saved North America.
+
+Had the Mississippi Valley been in Europe, Asia or Northern Africa, it
+would doubtless have been blood-soaked for centuries and dominated by
+highly organized nations, armed to the teeth. Lying isolated, it
+presented an almost virgin opportunity to the conquering Teutons of
+Western Europe.
+
+Freed by their isolated position from the necessity of contending
+against outside aggression, the inhabitants of the United States have
+expended their combative energies against the weaker peoples with whom
+they came into immediate contact,--
+
+
+     1. The Indians, from whom they took the land and wrested the right
+     to exploit the resources of the continent;
+
+     2. The African Negroes who were captured and brought to America to
+     labor as slaves;
+
+     3. The Mexicans, from whom they took additional slave territory at
+     a time when the institution of slavery was in grave danger, and
+
+     4. The Spanish Empire from which they took foreign investment
+     opportunities at a time when the business interests of the country
+     first felt the pressure of surplus wealth.
+
+
+Each of these four groups was weak. No one of them could present even
+the beginnings of an effectual resistance to the onslaught of the
+conquerors. Each in turn was forced to bow the knee before overwhelming
+odds.
+
+
+2. _The First Obstacle to Conquest_
+
+The first obstacle to the spread of English civilization across the
+continent of North America was the American Indian. He was in possession
+of the country; he had a culture of his own; he held the white man's
+civilization in contempt and refused to accept it. He had but one
+desire,--to be let alone.
+
+The continent was a "wilderness" to the whites. To the Indians it was a
+home. Their villages were scattered from the Atlantic to the Pacific,
+from the Gulf to Alaska; they knew well its mountains, plains and
+rivers. A primitive people, supporting themselves largely by hunting,
+fishing, simple agriculture and such elemental manual arts as pottery
+and weaving, they found the vast stretches of North America none too
+large to provide them with the means of satisfying their wants.
+
+The ideas of the Indian differed fundamentally from those of the white
+man. Holding to the Eastern conception which makes the spiritual life
+paramount, he reduced his material existence to the simplest possible
+terms. He had no desire for possessions, which he regarded--at the
+best--as "only means to the end of his ultimate perfection."[5] To him,
+the white man's desire for wealth was incomprehensible and the white
+man's sedentary life was contemptible. He must be free at all times to
+commune with nature in the valleys, and at sunrise and sunset to ascend
+the mountain peak and salute the Great Spirit.
+
+The individual Indian--having no desire for wealth--could not be bribed
+or bought for gold as could the European. The leaders, democratically
+selected, and held by the most enduring ties of loyalty to their tribal
+oaths, were above the mercenary standards of European commerce and
+statesmanship. Friendly, hospitable, courteous, generous, hostile,
+bitter, ferocious they were--but they were not for sale.
+
+The attitude of the Indian toward the land which the white men coveted
+was typical of his whole relation with white civilization. "Land
+ownership, in the sense in which we use the term, was unknown to the
+Indians till the whites came among them."[6] The land devoted to
+villages was tribal property; the hunting ground surrounding the village
+was open to all of the members of the tribe; between the hunting grounds
+of different tribes there was a neutral territory--no man's land--that
+was common to both. If a family cultivated a patch of land, the
+neighbors did not trespass. Among the Indians of the Southwest the
+village owned the agricultural land and "periodically its governor,
+elected by popular vote, would distribute or redistribute the arable
+acres among his constituents who were able to care for them."[7] The
+Indians believed that the land, like the sunlight, was a gift of the
+Great Spirit to his children, and they were as willing to part with the
+one as with the other.
+
+They carried their communal ideas still farther. Among the Indians of
+the Northwest, a man's possessions went at his death to the whole tribe
+and were distributed among the tribal members. Among the Alaskan
+Indians, no man, during his life, could possess more than he needed
+while his neighbor lacked. Food was always regarded as common property.
+"The rule being to let him who was hungry eat, wherever he found that
+which would stay the cravings of his stomach."[8] The motto of the
+Indian was "To each according to his need."
+
+Such a communist attitude toward property, coupled with a belief that
+the land--the gift of the Great Spirit--was a trust committed to the
+tribe, proved a source of constant irritation to the white colonists who
+needed additional territory. As the colonies grew, it became more and
+more imperative to increase the land area open for settlement, and to
+such encroachments the Indian offered a stubborn resistance.
+
+The Indian would not--could not--part with his land, neither would he
+work, as a slave or a wage-servant. Before such degradation he preferred
+death. Other peoples--the negroes; the inhabitants of Mexico, Peru and
+the West Indies; the Hindus and the Chinese--made slaves or servants.
+The Indian for generations held out stolidly against the efforts of
+missionaries, farmers and manufacturers alike to convert him into a
+worker.
+
+The Indian could not understand the ideas of "purchase," "sale" and
+"cash payment" that constitute essential features of the white man's
+economy. To him strength of limb, courage, endurance, sobriety and
+personal dignity and reserve were infinitely superior to any of the
+commercial virtues which the white men possessed.
+
+This attitude of the Indian toward European standards of civilization;
+his indifference to material possessions; his unwillingness to part with
+the land; and his refusal to work, made it impossible to "assimilate"
+him, as other peoples were assimilated, into colonial society. The
+individual Indian would not demean himself by becoming a cog in the
+white man's machine. He preferred to live and die in the open air of his
+native hills and plains.
+
+The Indian was an intense individualist--trained in a school of
+experience where initiative and personal qualities were the tests of
+survival. He placed the soles of his moccasined feet firmly against his
+native earth, cast his eyes around him and above him and melted
+harmoniously into his native landscape.
+
+Missionaries and teachers labored in vain--once an Indian, always an
+Indian. The white settlers pushed on across mountain ranges and through
+valleys. Generations came and went without any marked progress in
+bringing the white men and the red men together. When the Indian, in the
+mission or in the government school did become "civilized," he gave over
+his old life altogether and accepted the white man's codes and
+standards. The two methods of life were too far apart to make
+amalgamation possible.
+
+
+3. _Getting the Land_
+
+The white man must have land! Population was growing. The territory
+along the frontier seemed rich and alluring.
+
+Everywhere, the Indian was in possession, and everywhere he considered
+the sale of land in the light of parting with a birth-right. He was
+friendly at first, but he had no sympathy with the standards of white
+civilization.
+
+For such a situation there was only one possible solution. Under the
+plea that "necessity knows no law" the white man took up the task of
+eliminating the Indian, with the least friction, and in the most
+effective manner possible.
+
+There were three methods of getting the land away from the Indian--the
+easiest was by means of treaties, under which certain lands lying along
+the Atlantic Coast were turned over to the whites in exchange for larger
+territories west of the Mississippi. The second method was by purchase.
+The third was by armed conquest. All three methods were employed at some
+stage in the relations between the whites and each Indian tribe.
+
+The experience with the Cherokee Nation is typical of the relation
+between the whites and the other Indian tribes. (Annual Report of the
+Bureau of Ethnology. Vol. 5. "The Cherokee Nation," by Charles C.
+Royce.)
+
+The Cherokee nation before the year 1650 was established on the
+Tennessee River, and exercised dominion over all the country on the east
+side of the Alleghany Mountains, including the head-waters of the
+Yadkin, the Catawba, the Broad, the Savannah, the Chattahoochee and the
+Alabama. In 1775 there were 43 Cherokee towns covering portions of this
+territory. In 1799 their towns numbered 51.
+
+Treaty relations between the whites and the Cherokees began in 1721,
+when there was a peace council, held between the representatives of 37
+towns and the authorities of South Carolina. From that time, until the
+treaty made with the United States government in 1866, the Cherokees
+were gradually pushed back from their rich hunting grounds toward the
+Mississippi valley. By the treaty of 1791, the United States solemnly
+guaranteed to the Cherokees all of their land, the whites not being
+permitted even to hunt on them. In 1794 and 1804 new treaties were
+negotiated, involving additional cessions of land. By the treaty of
+1804, a road was to be cut through the Cherokee territory, free for the
+use of all United States citizens.
+
+An agitation arose for the removal of the Cherokees to some point west
+of the Mississippi River. Some of the Indians accepted the opportunity
+and went to Arkansas. Others held stubbornly to their villages.
+Meanwhile white hunters and settlers encroached on their land; white men
+debauched their women, and white desperadoes stole their stock. By the
+treaty of 1828 the United States agreed to possess the Cherokees and to
+guarantee to them forever several millions of acres west of Arkansas,
+and in addition a perpetual outlet west, and a "free and unmolested use
+of all the country lying west of the western boundary of the above
+described limits and as far west as the sovereignty of the United States
+and their right of soil extend" (p. 229). The Cherokees who had settled
+in Arkansas agreed to leave their lands within 14 months. By the treaty
+of 1836 the Cherokees ceded to the United States all lands east of the
+Mississippi. There was considerable difficulty in enforcing this
+provision but by degrees most of the Indians were removed west of the
+river. In 1859 and 1860 the Commissioner of Indian affairs prepared a
+survey of the Cherokee domain. This was opposed by the head men of the
+nation. By the Treaty of 1866 other tribes were quartered on land owned
+by the Cherokees and railroads were run through their territory.
+
+Diplomacy, money and the military forces had done their work. The first
+treaty, made in 1721, found the Cherokee nation in virtual possession of
+the mountainous regions of Southeastern United States. The twenty-fourth
+treaty (1866) left them on a tiny reservation, two thousand miles from
+their former home. Those twenty-four treaties had netted the State and
+Federal governments 81,220,374 acres of land (p. 378). To-day the
+Cherokee Nation has 63,211 acres.[9]
+
+A great nation of proud, independent, liberty-loving men and women,
+came into conflict with the whites of the Carolinas and Georgia; with
+the state and national governments. "For two hundred years a contest
+involving their very existence as a people has been maintained against
+the unscrupulous rapacity of Anglo-Saxon civilization. By degrees they
+were driven from their ancestral domain to an unknown and inhabitable
+region" (p. 371). Now the contest is ended. The white men have the land.
+The Cherokees have a little patch of territory; government support; free
+schools and the right to accept the sovereignty of the nation that has
+conquered them.
+
+The theory upon which the whites proceeded in taking the Indian lands is
+thus stated by Leupp,--"Originally, the Indians owned all the land;
+later we needed most of it for ourselves; therefore, it is but just that
+the Indians should have what is left."[10]
+
+
+4. _The Triumph of the Whites_
+
+The early white settlers had been, in almost every instance, hospitably
+or even reverentially welcomed by the Indians, who regarded them as
+children of the Great White Spirit. During the first bitter winters, it
+was the Indians who fed the colonists from their supplies of grain;
+guided them to the better lands, and shared with them their knowledge
+of hunting, fishing and agriculture. The whites retaliated with that
+cunning, grasping, bestial ferocity which has spread terror through the
+earth during the past five centuries.
+
+In the early years, when the whites were few and the Indians many, the
+whites satisfied themselves by debauching the red men with whiskey and
+bribing them with baubles and trinkets. At the same time they made
+offensive and defensive alliances with them. The Spanish in the South;
+the French in the North and the English between, leagued themselves with
+the various tribes, supplied them with gunpowder and turned them into
+mercenaries who fought for hire. Heretofore the Indian had been a free
+man, fighting his wars and feuds as free men have done time out of mind.
+The whites hired him as a professional soldier and by putting bounties
+on scalps, plying the Indians with whiskey and inciting them by every
+known device, they converted them into demons.
+
+There is no evidence to show that up to the advent of the white men the
+Indian tribes did any more fighting among themselves than the nobles of
+Germany, the city states of Italy or the other inhabitants of western
+Europe. Indeed there has recently been published a complete translation
+of the "Constitution of the Five Nations," a league to enforce peace
+which the Indians organized about the year 1390, A. D.[11] This league
+which had as its object the establishment of the "Great Peace" was built
+upon very much the same argument as that advanced for the League of
+Nations of 1919.
+
+When the whites first came to North America, the Indians were a
+formidable foe. For years they continued to be a menace to the lonely
+settler or the frontier village. But when the white settlers were once
+firmly established, the days of uncertainty were over, and the Indians
+were brushed aside as a man brushes aside a troublesome insect. Their
+"uprisings" and "wars" counted for little or nothing. They were inferior
+in numbers; they were poorly armed and equipped; they had no reserves
+upon which to draw; there was no organization among the tribes in
+distant portions of the country. The white millions swept onward. The
+Indian bands made a stand here and there but the tide of white
+civilization overwhelmed them, smothered them, destroying them and their
+civilization together.
+
+The Indians were the first obstacle to the building of the American
+Empire. Three hundred years ago the whole three million square miles
+that is now the United States was theirs. They were the American people.
+To-day they number 328,111 in a population of 105,118,467 and the total
+area of their reservations is 53,489 square miles. (Statistical Abstract
+of the U. S., 1918, pp. 8 and 776.)
+
+FOOTNOTES:
+
+[4] The total number of square miles in Indian Reservations in 1918 was
+53,490 as against 241,800 square miles in 1880. (Statistical Abstract of
+the United States, 1918, p. 8.)
+
+[5] "The Indian of To-day," C. A. Eastman. New York, Doubleday, 1915, p.
+4.
+
+[6] "The Indian and His Problem," F. E. Leupp. New York, Scribners,
+1910, p. 23.
+
+[7] Ibid., p. 24.
+
+[8] Ibid., p. 10.
+
+[9] "Referring to your inquiry of November 20, 1919, concerning the
+Cherokee Indian Reservation, you are advised that the Cherokee Indian
+country in the northeastern part of Oklahoma aggregated 4,420,068 acres.
+
+"Of said area 4,346,223 acres have been allotted in severalty to the
+enrolled members of said Cherokee Indian Nation, Oklahoma. Twenty-two
+thousand eight hundred and eighty acres were disposed of as town lots,
+or reserved for railway rights of way, churches, schools, cemeteries,
+etc., and the remaining area has been sold, or otherwise disposed of as
+provided by law.
+
+"The Cherokee tribal land in Oklahoma with the exception of the possible
+title of said Nation to certain river beds has been disposed of.
+
+"In reference to the Eastern band of Cherokees, you are advised that
+said Indians who have been incorporated hold title in fee to certain
+land in North Carolina, known as the Qualla Reservation and certain
+other lands, aggregating 63,211 acres."--Letter from the Office of
+Indian Affairs. Dec. 9, 1919, "In re Cherokee land."
+
+[10] "The Indian and His Problem," F. E. Leupp. New York, Scribners,
+1910, p. 24.
+
+[11] See Bulletin 184, New York State Museum, Albany, 1916, p. 61.
+
+
+
+
+IV. SLAVERY FOR A RACE
+
+
+1. _The Labor Shortage_
+
+The American colonists took the land which they required for settlement
+from the Indians. The labor necessary to work this land was not so
+easily secured. The colonists had set themselves the task of
+establishing European civilization upon a virgin continent. In order to
+achieve this result, they had to cut the forests; clear the land; build
+houses; cultivate the soil; construct ships; smelt iron, and carry on a
+multitude of activities that were incidental to setting up an old way of
+life in a new world. The one supreme and immediate need was the need for
+labor power. From the earliest days of colonization there had been no
+lack of harbors, fertile soil, timber, minerals and other resources.
+From the earliest days the colonists experienced a labor shortage.
+
+The labor situation was trebly difficult. First, there was no native
+labor; second, passage from Europe was so long and so hazardous that
+only the bold and venturesome were willing to attempt it, and third,
+when these adventurers did reach the new world, they had a choice
+between taking up free land and working it for themselves and taking
+service with a master. Men possessing sufficient initiative to leave an
+old home and make a journey across the sea were not the men to submit
+themselves to unnecessary authority when they might, at will, become
+masters of their own fortunes. The appeal of a new life was its own
+argument, and the newcomers struck out for themselves.
+
+Throughout the colonies, and particularly in the South where the
+plantation culture of rice and tobacco, and later of cotton, called for
+large numbers of unskilled workers, the labor problem was acute. The
+abundance of raw materials and fertile land; the speedy growth of
+industry in the North and of agriculture in the South; the generous
+profits and expanding markets created a labor demand which far
+outstripped the meager supply,--a demand that was met by the importation
+of black slaves from Africa.
+
+
+2. _The Slave Coast_
+
+The "Slave Coast" from which most of the Negroes came was discovered by
+Portuguese navigators, who were the first Europeans to venture down the
+West coast of Africa, and, rounding the "lobe" of the continent, to sail
+East along the "Gold Coast." The trade in gold and ivory which sprang up
+as a result of these early explorations led other nations of Europe to
+begin an eager competition which eventually brought French, Dutch,
+German, Danish and English commercial interests into sharp conflict with
+the Portuguese.
+
+Ships sailing from the Gold Coast for home ports made a practice of
+picking up such slaves as they could easily secure. By 1450 the number
+reaching Portugal each year was placed at 600 or 700.[12] From this
+small and quite incidental beginning there developed a trade which
+eventually supplied Europe, the West Indies, North America and South
+America with black slaves.
+
+Along the "Slave Coast," which extended from Cape Verde on the North to
+Cape St. Martha on the South, and in the hinterland there lived Negroes
+of varying temperaments and of varying standards of culture. Some of
+them were fierce and warlike. Others were docile and amenable to
+discipline. The former made indifferent slaves; the latter were eagerly
+sought after. "The Wyndahs, Nagoes and Pawpaws of the Slave Coast were
+generally the most highly esteemed of all. They were lusty and
+industrious, cheerful and submissive."[13]
+
+The natives of the Slave Coast had made some notable cultural advances.
+They smelted metals; made pottery; wove; manufactured swords and spears
+of merit; built houses of stone and of mud, and made ornaments of some
+artistic value. They had developed trade with the interior, taking salt
+from the coast and bartering it for gold, ivory and other commodities at
+regular "market places."
+
+The native civilization along the West coast of Africa was far from
+ideal, but it was a civilization which had established itself and which
+had made progress during historic times. It was a civilization that had
+evolved language; arts and crafts; tribal unity; village life, and
+communal organization. This native African civilization, in the
+seventeenth, eighteenth and early nineteenth centuries was confronted by
+an insatiable demand for black slaves. The conflicts that resulted from
+the efforts to supply that demand revolutionized and virtually destroyed
+all that was worthy of preservation in the native culture.
+
+When the whites first went to the Slave Coast there was comparatively
+little slavery among the natives. Some captives, taken in war; some
+debtors, unable to meet their obligations, and some violators of
+religious rites, were held by the chief or the headman of the tribe. On
+occasion he would sell these slaves, but the slave trade was never
+established as a business until the white man organized it.
+
+The whites came, and with guile and by force they persuaded and
+compelled the natives to permit the erection of forts and of trading
+posts. From the time of the first Portuguese settlement, in 1482, the
+whites began their work with rum and finished it with gun-powder. Rum
+destroyed the stamina of the native; gun-powder rendered his intertribal
+wars more destructive. These two agencies of European civilization
+combined, the one to degenerate, the other to destroy the native tribal
+life.
+
+The traders, adventurers, buccaneers and pirates that gathered along the
+Slave Coast were not able to teach the natives anything in the way of
+cruelty, but they could and did give them lessons in cunning, trickery
+and double dealing. Early in the history of the Gold Coast the whites
+began using the natives to make war on commercial rivals. In one famous
+instance, "the Dutch had instigated the King of Fetu to refuse the
+Assins permission to pass through his territory. These people used to
+bring a great deal of gold to Cape Coast Castle (English), and the Dutch
+hoped in this way to divert the trade to their own settlements. The King
+having complied and plundered some of the traders on the way down, the
+Assins declared war against him and were assisted by the English with
+arms and ammunition. The King of Sabol was also paid to help them, and
+the allied army (20,000 strong) inflicted a crushing defeat on the
+Fetus."[14]
+
+On another occasion, the Dutch were worsted in a war with some of the
+native tribes. Realizing that if they were to maintain themselves on the
+Coast they must raise an army as quickly as possible, they approached
+the Fetus and bargained with them to take the field and fight the
+Komendas until they had utterly exterminated them, on payment of $4,500.
+But no sooner had this arrangement been made than the English paid the
+Fetus an additional $4,500 to remain neutral![15]
+
+Before 1750, when the competition for the slaves was less keen, and the
+supply came nearer to meeting the demand, the slavers were probably as
+honest in this as they were in any other trade with the natives. The
+whites encouraged and incited the native tribes to make war upon one
+another for the benefit of the whites. The whites fostered kidnaping,
+slavery and the slave trade. The natives were urged to betray one
+another, and the whites took advantage of their treachery. During the
+four hundred years that the African slave trade was continued, it was
+the whites who encouraged it; fostered it; and backed it financially.
+The slave trade was a white man's trade, carried on under conditions as
+far removed from the conditions of ordinary African life as the
+manufacturing and trading of Europe were removed from the manufacturing
+and trading of the Africans.
+
+
+3. _The Slave Trade_
+
+With the pressing demand from the Americas for a generous supply of
+black slaves, the business of securing them became one of the chief
+commercial activities of the time. "The trade bulked so large in the
+world's commerce in the seventeenth and eighteenth centuries that every
+important maritime community on the Atlantic sought a share, generally
+with the sanction and often with the active assistance of its respective
+sovereign."[16]
+
+The catching, holding and shipping of Negroes on the African coast was
+the means by which the demand for slaves was met. With a few minor
+exceptions, the whites did not engage directly in slave catching. In
+most instances they bought their slaves from native brokers who lived in
+the coast towns. The brokers, in turn, received their slaves from the
+interior, where they were captured during wars, by professional raiding
+parties, well supplied with arms and ammunition. Slave-catching, begun
+as a kidnaping of individuals, developed into a large-scale traffic that
+provided the revenue of the more war-like natives. Villages were
+attacked and burned, and whole tribes were destroyed or driven off to
+the slave-pens on the coast. After 1750, for nearly a hundred years, the
+demand for slaves was so great and the profits were so large that no
+pains were spared to secure them.
+
+The Slave Coast native was compelled to choose between being a
+slave-catcher or a slave. As a slave-catcher he spread terror and
+destruction among his fellows, seized them and sold them to white men.
+As a slave he made the long journey across the Atlantic.
+
+The number of slaves carried away from Africa is variously estimated.
+Claridge states that "the Guinea Coast as a whole supplied as many as
+from 70,000 to 100,000 yearly" in 1700.[17] Bogart estimates the number
+of slaves secured as 2,500 per year in 1700; 15,000 to 20,000 per year
+from 1713 to 1753; in 1771, 47,000 carried by British ships alone; and
+in 1768 the slaves shipped from the African coast numbered 97,000.[18]
+Add to these numbers those who were killed in the raids; those who died
+in the camps, where the mortality was very high, and those who committed
+suicide. The total represents the disturbing influence that the slave
+trade introduced into the native African civilization.
+
+In the early years of the trade the ships were small and carried only a
+few hundred Negroes at most. As the trade grew, larger and faster ships
+were built with galleries between the decks. On these galleries the
+blacks were forced to lie with their feet outboard--ironed together, two
+and two, with the chains fastened to staples in the deck. "They were
+squeezed so tightly together that the average space allowed to each one
+was but 16 inches by five and a half feet."[19] The galleries were
+frequently made of rough lumber, not tightly joined. Later, when the
+trade was outlawed, the slaves were stowed away out of sight on loose
+shelves over the cargo. "Where the 'tween decks space was two feet high
+or more, the slaves were stowed sitting up in rows, one crowded into the
+lap of another, and with legs on legs, like rider on a crowded
+toboggan." (Spears, p. 71.) There they stayed for the weeks or the
+months of the voyage. "In storms the sailors had to put on the hatches
+and seal tight the openings into the infernal cesspool." (Spears, p.
+71.) The odor of a slaver was often unmistakable at a distance of five
+miles down wind.
+
+The terrible revolt of the slaves in the West Indies, beginning in
+1781, gave the growing anti-slavery sentiment an immense impetus. It
+also gave the slave owners pause. The cotton-gin had not yet been
+invented. Slavery was on a shifty economic basis in the South. Great
+Britain passed the first law to limit the slave trade in 1788; the
+United States outlawed the trade in 1794. In 1824 Great Britain declared
+the slave trade piracy. During these years, and during the years that
+followed, until the last slaver left New York Harbor in 1863, the trade
+continued under the American flag, in swift, specially constructed
+American-built ships.
+
+As the restrictions upon the trade became more severe in the face of an
+increasing demand for slaves, "the fitting out of slavers developed into
+a flourishing business in the United States, and centered in New York
+City." _The New York Journal of Commerce_ notes in 1857 that "down-town
+merchants of wealth and respectability are extensively engaged in buying
+and selling African Negroes, and have been, with comparatively little
+interruption for an indefinite number of years." A writer in the
+_Continental Monthly_ for January, 1862, says:--"The city of New York
+has been until of late the principal port of the world for this infamous
+commerce; although the cities of Boston and Portland, are only second to
+her in distinction." During the years 1859-1860 eighty-five slavers are
+reported to have fitted out in New York Harbor and these ships alone had
+a capacity to transport from 30,000 to 60,000 slaves a year.[20]
+
+The merchants of the North pursued the slave trade so relentlessly
+because it paid such enormous profits on the capital outlay. Some of the
+voyages went wrong, but the trade, on the whole, netted immense returns.
+At the end of the eighteenth century a good ship, fitted to carry from
+300 to 400 slaves, could be built for about $35,000. Such a ship would
+make a clear profit of from $30,000 to $100,000 in a single voyage. Some
+of them made as many as five voyages before they became so foul that
+they had to be abandoned.[21] While some voyages were less profitable
+than others, there was no avenue of international trade that offered
+more alluring possibilities.
+
+Sanctioned by potentates, blessed by the church, and surrounded with the
+garments of respectability, the slave trade grew, until, in the words of
+Samuel Hopkins (1787), "The trade in human species has been the first
+wheel of commerce in Newport, on which every other movement in business
+has depended.... By it the inhabitants have gotten most of their wealth
+and riches." (Spears, p. 20.) After the vigorous measures taken by the
+British Government for its suppression, the slave trade was carried on
+chiefly in American-built ships; officered by American citizens; backed
+by American capital, and under the American flag.
+
+The slave trade was the business of the North as slavery was the
+business of the South. Both flourished until the Proclamation of
+Emancipation in 1863.
+
+
+4. _Slavery in the United States_
+
+Slavery and the slave trade date from the earliest colonial times. The
+first slaves in the English colonies were brought to Jamestown in 1619
+by a Dutch ship. The first American-built slave ship was the _Desire_,
+launched at Marblehead in 1636. There were Negro slaves in New York as
+early as 1626, although there were only a few hundred slaves in the
+colonies prior to 1650.
+
+Since slave labor is economical only where the slaves can be worked
+together in gangs, there was never much slavery among the farmers and
+small business men of the North. On the other hand, in the South, the
+developing plantation system made it possible for the owner to use large
+gangs of slaves in the clearing of new land; in the raising of tobacco,
+and in caring for rice and cotton. The plantation system of agriculture
+and the cotton gin made slavery the success that it was in the United
+States. "The characteristic American slave, indeed, was not only a
+Negro, but a plantation workman."[22]
+
+The opening years of the nineteenth century found slavery intrenched
+over the whole territory of the United States that lay South of the
+Mason and Dixon line. In that territory slave trading and slave owning
+were just as much a matter of course as horse trading and horse owning
+were a matter of course in the North. "Every public auctioneer handled
+slaves along with other property, and in each city there were brokers,
+buying them to sell again, and handling them on commission."[23]
+
+The position of the broker is indicated in the following typical bill of
+sale which was published in Charleston, S. C., in 1795. "Gold Coast
+Negroes. On Thursday, the 17th of March instant, will be exposed to
+public sale near the exchange ... the remainder of the cargo of negroes
+imported in the ship _Success_, Captain John Conner, consisting chiefly
+of likely young boys and girls in good health, and having been here
+through the winter may be considered in some degree seasoned to the
+climate."[24]
+
+Such a bill of sale attracted no more attention at that time than a
+similar bill advertising cattle attracts to-day.
+
+During the early colonial days, the slaves were better fed and provided
+for than were the indentured servants. They were of greater money value
+and, particularly in the later years when slavery became the mainstay of
+Southern agriculture, a first class Negro, acclimated, healthy, willing
+and trustworthy, was no mean asset.
+
+Toward the end of the eighteenth century slavery began to show itself
+unprofitable in the South. The best and most accessible land was
+exhausted. Except for the rice plantations of South Carolina and
+Georgia, slavery was not paying. The Southern delegates to the
+Constitutional Convention, with the exception of the delegates from
+these states, were prepared to abolish the slave trade. Some of them
+were ready to free their own slaves. Then came the invention of the
+cotton gin and the rise of the cotton kingdom. The amount of raw cotton
+consumed by England was 13,000 bales in 1781; 572,000 bales in 1820; and
+3,366,000 bales in 1860. During that period, the South was almost the
+sole source of supply.
+
+The attitude of the South, confronted by this wave of slave prosperity,
+underwent a complete change. Her statesmen had consented, between 1808
+and 1820, to severe restrictive laws directed towards the slave trade.
+After cotton became king, slaves rose rapidly in price; land, once used
+and discarded, was again brought under cultivation; cotton-planting
+spread rapidly into the South and Southwest; Texas was annexed; the
+Mexican War was fought; an agitation was begun for the annexation of
+Cuba, and Calhoun (1836) declared that he "ever should regret that this
+term (piracy) had been applied" to the slave trade in our laws.[25]
+
+The change of sentiment corresponded with the changing value of the
+slaves. Phillips publishes a detailed table of slave values in which he
+estimates that an unskilled, able-bodied young slave man was worth $300
+in 1795; $500 to $700 in 1810; $700 to $1200 to in 1840; and $1100 to
+$1800 in 1860.[26] The factors which resulted in the increased slave
+prices were the increased demand for cotton, the increased demand for
+slaves, and the decrease in the importation of negroes due to the
+greater severity of the prohibitions on the slave trade.
+
+
+5. _Slavery for a Race_
+
+The American colonists needed labor to develop the wilderness. White
+labor was scarce and high, so the colonists turned to slave labor
+performed by imported blacks. The merchants of the North built the ships
+and carried on the slave trade at an immense profit. The plantation
+owners of the South exploited the Negroes after they reached the states.
+
+The continuance of the slave trade and the provision of a satisfactory
+supply of slaves for the Southern market depended upon slave-catching in
+Africa, which, in turn, involved the destruction of an entire
+civilization. This work of destruction was carried forward by the
+leading commercial nations of the world. During nearly 250 years the
+English speaking inhabitants of America took an active part in the
+business of enslaving, transporting and selling black men. These
+Americans--citizens of the United States--bought stolen Negroes on the
+African coast; carried them against their will across the ocean; sold
+them into slavery, and then, on the plantations, made use of their
+enforced labor.
+
+Both slavery and the slave trade were based on a purely economic
+motive--the desire for profit. In order to satisfy that desire, the
+American people helped to depopulate villages,--to devastate, burn,
+murder and enslave; to wipe out a civilization, and to bring the
+unwilling objects of their gain-lust thousands of miles across an
+impassable barrier to alien shores.
+
+FOOTNOTES:
+
+[12] "History of the Gold Coast," W. W. Claridge. London, Murray, 1915,
+vol. I, p. 39.
+
+[13] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1908,
+p. 43.
+
+[14] "A History of the Gold Coast," W. W. Claridge. London, Murray,
+1915, vol. I, p. 144.
+
+[15] Ibid., p. 150.
+
+[16] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+p. 20.
+
+[17] "History of the Gold Coast," W. W. Claridge. London, Murray, 1915,
+vol. I, p. 172.
+
+[18] "Economic History of the U. S.," E. L. Bogart. New York, Longmans,
+1910 ed., p. 84-5.
+
+[19] "The American Slave Trade," J. R. Spears. New York, Scribners,
+1901, p. 69.
+
+[20] "The Suppression of the American Slave Trade," W. E. B. DuBois. New
+York, Longmans, 1896, p. 178-9.
+
+[21] "The American Slave Trade," J. R. Spears. New York, Scribners,
+1901, p. 84-5.
+
+[22] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+p. VII.
+
+[23] Ibid., p. 190.
+
+[24] Ibid., p. 40.
+
+[25] Benton, "Abridgment of Debates." XII, p. 718.
+
+[26] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+p. 370.
+
+
+
+
+V. THE WINNING OF THE WEST
+
+
+1. _Westward, Ho!_
+
+The English colonists in America occupied only the narrow strip of
+country between the Alleghanies and the Atlantic Ocean. The interior was
+inhabited by the Indians, and claimed by the French, the Spanish and the
+British, but neither possession nor legal title carried weight with the
+stream of pioneers that was making a path into the "wilderness," crying
+its slogan,--"Westward, Ho!" as it moved toward the setting sun. The
+first objective of the pioneers was the Ohio Valley; the second was the
+valley of the Mississippi; the third was the Great Plains; the fourth
+was the Pacific slope, with its golden sands. Each one of these
+objectives developed itself out of the previous conquest.
+
+The settlers who made their way across the mountains into the valley of
+the Ohio, found themselves in a land of plenty. The game was abundant;
+the soil was excellent, and soon they were in a position to offer their
+surplus products for sale. These products could not be successfully
+transported across the mountains, but they could be floated down the
+Ohio and the Mississippi--a natural roadway to the sea. But beside the
+Indians, who claimed all of the land for their own, there were the
+Spaniards at New Orleans, doing everything in their power to prevent the
+American Colonists from building up a successful river commerce.
+
+The frontiersmen were able to push back the Indians. The Spanish
+garrisons presented a more serious obstacle. New Orleans was a well
+fortified post that could be provisioned from the sea. Behind it,
+therefore, lay the whole power of the Spanish fleet. The right of
+navigation was finally obtained in the Treaty of 1795. Still friction
+continued with the Spanish authorities and serious trouble was averted
+only by the transfer of Louisiana, first to the French (1800) and then
+by them to the United States (1803). Napoleon had agreed, when he
+secured this territory from the Spaniards, not to turn it over to the
+United States. A pressing need of funds, however, led him to strike an
+easy bargain with the American government which was negotiating for the
+control of the mouth of the Mississippi. Napoleon insisted that the
+United States take, not only the mouth of the river, but also the
+territory to the West which he saw would be useless without this outlet.
+After some hesitation, Jefferson and his advisers accepted the offer and
+the Louisiana Purchase was consummated.
+
+The Louisiana Purchase gave the young American nation what it needed--a
+place in the sun. The colonists had taken land for their early
+requirements from the Indians who inhabited the coastal plain. They had
+enslaved the Negroes and thus had secured an ample supply of cheap
+labor. Now, the pressure of population, and the restless, pioneer spirit
+of those early days, led out into the West.
+
+Until 1830 immigration was not a large factor in the increase of the
+colonial population, but the birth-rate was prodigious. In the closing
+years of the eighteenth century, Franklin estimated that the average
+family had eight children. There were sections of the country where the
+population doubled, by natural increase, once in 23 years. Indeed, the
+entire population of the United States was increasing at a phenomenal
+rate. The census of 1800 showed 5,308,483 persons in the country. Twenty
+years later the population was 9,638,453--an increase of 81 per cent. By
+1840 the population was reported as 17,069,453--an increase of 77 per
+cent over 1820, and of 221 per cent over 1800.
+
+The small farmers and tradesmen of the North were settling up the
+Northwest Territory. The plantation owners of the South, operating on a
+large scale, and with the wasteful methods that inevitably accompany
+slavery, were clamoring for new land to replace the tracts that had
+been exhausted by constant recropping with no attempt at fertilization.
+
+Cotton had been enthroned in the South since the invention of the cotton
+gin in 1792. With the resumption of European trade relations in 1815 the
+demand for cotton and for cotton lands increased enormously. There was
+one, and only one logical way to meet this demand--through the
+possession of the Southwest.
+
+
+2. _The Southwest_
+
+The pioneers had already broken into the Southwest in large numbers.
+While Spain still held the Mississippi, there were eager groups of
+settlers pressing against the frontier which the Spanish guarded so
+jealously against all comers. The Louisiana Purchase met the momentary
+demand, but beyond the Louisiana Purchase, and between the settlers and
+the rich lands of Texas lay the Mexican boundary. The tide of migration
+into this new field hurled itself against the Mexican border in the same
+way that an earlier generation had rolled against the frontier of
+Louisiana.
+
+The attitude of these early settlers is described with sympathetic
+accuracy by Theodore Roosevelt. "Louisiana was added to the United
+States because the hardy backwoods settlers had swarmed into the valleys
+of the Tennessee, the Cumberland and the Ohio by hundreds of
+thousands.... Restless, adventurous, hardy, they looked eagerly across
+the Mississippi to the fertile solitudes where the Spaniard was the
+nominal, and the Indian the real master; and with a more immediate
+longing they fiercely coveted the Creole provinces at the mouth of the
+river."[27] This fierce coveting could have only one possible
+outcome--the colonists got what they wanted.
+
+The speed with which the Southwest rushed into prominence as a factor
+in national affairs is indicated by its contribution to the cotton-crop.
+In 1811 the states and territories from Alabama and Tennessee westward
+produced one-sixteenth of the cotton grown in the United States. In 1820
+they produced a third; in 1830, a half; and by 1860, three-quarters of
+the cotton raised. At the same time, the population of the
+Alabama-Mississippi territory was:--
+
+
+       200,000 in 1810.
+       445,000 in 1820.
+       965,000 in 1830.
+     1,377,000 in 1840.
+
+
+Thus thirty years saw an increase of nearly seven-fold in the population
+of this region.[28]
+
+Meanwhile, slavery had become the issue of the day. The slave power was
+in control of the Federal Government, and in order to maintain its
+authority, it needed new slave states to offset the free states that
+were being carved out of the Northwest.
+
+Here were three forces--first the desire of the frontiersmen for "elbow
+room"; second the demand of King Cotton for unused land from which the
+extravagant plantation system might draw virgin fertility and third, the
+necessity that was pressing the South to add territory in order to hold
+its power. All three forces impelled towards the Southwest, and it was
+thither that population pressed in the years following 1820.
+
+
+3. _Texas_
+
+Mexico lay to the Southwest, and therefore Mexico became the object of
+American territorial ambitions. The district now known as Texas had
+constituted a part of the Louisiana Purchase (1803); had been ceded to
+Spain (1819); had been made the object of negotiations looking towards
+its purchase in 1826; had revolted against Mexico and been recognized
+as an independent state in 1835.
+
+Texas had been settled by Americans who had secured the permission of
+the Mexican Government to colonize. These settlers made no effort to
+conceal their opposition to the Mexican Government, with which they were
+entirely out of sympathy. Many of them were seeking territory in which
+slavery might be perpetuated, and they introduced slaves into Texas in
+direct violation of the Mexican Constitution. The Americans did not go
+to Texas with any idea of becoming Mexican subjects; on the contrary, as
+soon as they felt themselves strong enough, they declared their
+independence of Mexico, and began negotiations for the annexation of
+Texas to the United States.
+
+The Texan struggle for independence from Mexico was cordially welcomed
+in all parts of the United States, but particularly in the South.
+Despite the protests of Mexico, public meetings were held; funds were
+raised; volunteers were enlisted and equipped, and supplies and
+munitions were sent for the assistance of the Texans in ships openly
+fitted out in New Orleans.
+
+No sooner had the Texans established a government than the campaign for
+annexation was begun. The advocates of annexation--principally
+Southerners--argued in favor of adding so rich and so logical a prize to
+the territory of the United States, citing the purchase of Louisiana and
+of Florida as precedents. Their opponents, first on constitutional
+grounds and then on grounds of public policy, argued against annexation.
+
+Opinion in the South was greatly aroused. Despite the fact that many of
+her foremost statesmen were against annexation, some of the Southern
+newspapers even went so far as to threaten the dissolution of the Union
+if the treaty of ratification failed to pass the Senate.
+
+The campaign of 1844 was fought on the issue of annexation and the
+election of James K. Polk was a pledge that Texas should be annexed to
+the United States. During the campaign, the line of division on
+annexation had been a party line--Democrats favoring; Whigs opposing.
+Between the election and the passage of the joint resolution by which
+annexation was consummated, it became a sectional issue,--Southern Whigs
+favoring annexation and Northern Democrats opposing it.
+
+So strong was the protest against annexation, that the treaty could not
+command the necessary two-thirds vote in the Senate. The matter was
+disposed of by the passage of a joint resolution (March 1, 1845) which
+required only a majority vote in both houses of Congress. President Polk
+therefore took office with the mandate of the country and the decision
+of both houses of the retiring Congress, in favor of annexation.
+
+Mexico, in the meantime, had offered to recognize the independence of
+Texas and to make peace with her if the Texas Congress would reject the
+joint resolution, and refuse the proffered annexation. This the Texas
+Congress refused, and with the passage, by that body, of an act
+providing for annexation, the Mexican minister was withdrawn from
+Washington, and Mexico began her preparations for war.
+
+President Polk had taken office with the avowed intention of buying
+California from Mexico. The rupture threatened to prevent him from
+carrying this plan into effect. He therefore sent an unofficial
+representative to Mexico in an effort to restore friendly relations.
+Failing in that, he and his advisers determined upon war as the only
+feasible method of obtaining California and of settling the diplomatic
+tangle involved in the annexation of Texas.
+
+
+4. _The Conquest of Mexico_
+
+The Polk Administration made the Mexican War as a part of its
+expansionist policy.
+
+"Although that unfortunate country (Mexico) had officially notified the
+United States that the annexation of Texas would be treated as a cause
+of war, so constant were the internal quarrels in Mexico that open
+hostilities would have been avoided had the conduct of the
+Administration been more honorable. That was the opinion of Webster,
+Clay, Calhoun, Benton, and Tyler.... Mexico was actually goaded on to
+war. The principle of the manifest destiny of this country was invoked
+as a reason for the attempt to add to our territory at the expense of
+Mexico."[29]
+
+After the annexation of Texas it became the duty of the United States to
+defend that state against the threatened Mexican invasion.
+
+Mexican troops had occupied the southern bank of the Rio Grande. General
+Zachary Taylor with a small force, moved to a position on the Nueces
+River. Between the two rivers lay a strip of territory the possession of
+which was one of the sources of dispute between Mexico and Texas. What
+followed may be stated in the words of one of the officers who
+participated in the expedition: "The presence of the United States
+troops on the edge of the territory farthest from the Mexican
+settlements was not sufficient to provoke hostilities. We were sent to
+provoke a fight, but it was essential that Mexico begin it" (p. 41).
+"Mexico showing no willingness to come to the Nueces to drive the
+invaders from her soil, it became necessary for the 'invaders' to
+approach to within a convenient distance to be struck. Accordingly,
+preparations were begun for moving the army to the Rio Grande, to a
+point near Matamoras. It was desirable to occupy a position near the
+largest center of population possible to reach without actually invading
+territory to which we set up no claim whatever" (p. 45).[30]
+
+The occupation, by the United States troops, of the disputed territory
+soon led to a clash in which several United States soldiers were killed.
+The incident was taken by the President as a sufficient cause for the
+declaration of a state of war. The House complied readily with his
+wishes, passing the necessary resolution. Several members of the Senate
+begged for a delay during which the actual state of affairs might be
+ascertained. The President insisted, however, and the war was declared
+(May 13, 1846).
+
+The declaration of war was welcomed with wild enthusiasm in the South.
+Meetings were called; funds were raised; volunteers were enlisted,
+equipped and despatched in all haste to the scene of the conflict.
+
+The North was less eager. There were protests, petitions,
+demonstrations. Many of the leaders of northern opinion took a public
+stand against the war. But the news of the first victories sent the
+country mad with an enthusiasm in which the North joined the South.
+
+The United States troops, during the Mexican War, won brilliant--almost
+unbelievable successes--against superior forces and in the face of
+immense natural obstacles. Had the war been less of a military triumph
+there must have been a far more widely-heard protest from Polk's enemies
+in the North. Successful beyond the wildest dreams of its promoters, the
+victorious war carried its own answer to those who questioned the
+worthiness of the cause. Within two years, the whole of Mexico was under
+the military control of the United States, and that country was in a
+position to dictate its own terms.
+
+The demands of the United States were mild to the extent of generosity.
+Under the treaty the annexation of Texas was validated; New Mexico and
+Upper California were ceded to the United States; the lower Rio Grande
+was fixed as the southern boundary of Texas, and in considerations of
+these additions to its territory, the United States agreed to pay Mexico
+fifteen millions of dollars.
+
+Under this plan, Mexico was paid for territory that she did not need and
+could not use, while the United States gave a money consideration for
+the title to land that was already hers by right of conquest, and of
+which she was in actual possession.
+
+The details of the treaty are relatively unimportant. The outstanding
+fact is that Mexico was in possession of certain territory that the
+ruling power in the United States wanted, and that ruling power took
+what it wanted by force of arms. "The war was one of conquest in the
+interest of an institution." It was "one of the most unjust ever waged
+by a stronger against a weaker nation."[31]
+
+Congressman A. P. Gardner of Massachusetts summarized the matter very
+pithily in his debate with Morris Hillquit (New York, April 2, 1915),
+"We assisted Texas to get away from Mexico and then we proceeded to
+annex Texas. Plainly and bluntly stated, our purpose was to get some
+territory for American development." (Stenographic report in the _New
+York Call_, April 11, 1915.)
+
+
+5. _Conquering the Conquered_
+
+The work of conquering the Southwest was not completed by the
+termination of the war. Mexico ceded the territory--in the neighborhood
+of a million square miles--but she was giving away something that she
+had never possessed. Mexico claimed title to land that was occupied by
+the Indians. She had never conquered it; never settled it; never
+developed it. Her sovereignty was of the same shadowy sort that Spain
+had exercised over the country before the Mexican revolution.
+
+The new owners of the Southwest had a very different purpose in mind. No
+empty title would satisfy them. They intended to use the land. The
+Indians--already in possession--resented the encroachments of the
+invaders, but they fared no better than the Mexicans, or than their
+red-skinned brothers who had contended for the right to fish and hunt
+along their home streams in the Appalachians. The Indians of the
+Southwest fought stubbornly, but the wars that meant life and death to
+them were the merest pastime for an army that had just completed the
+humiliation of a nation of the size and strength of Mexico. The Indians
+were swept aside, and the country was opened to the trapper, the
+prospector, the trader and the settler.
+
+The Mexican War was a slight affair, involving a relatively small outlay
+in men and money. The total number of American soldiers killed in the
+war was 1,721; the wounded were 4,102; the deaths from accident and
+disease were 11,516, making total casualties of 5,823 and total losses
+of 15,618.[32]
+
+The money cost of the Mexican War--the army and navy appropriations for
+the years 1846 to 1849 inclusive--was $119,624,000. Obviously the net
+cost of the war was less than this gross total,--how much less it is
+impossible to say.
+
+No satisfactory figures are available to show the cost in men and money
+of the Indian Wars in the Southwest. "From 1849 to 1865, the government
+expended $30,000,000 in the subjugation of the Indians in the
+territories of New Mexico and Arizona."[33] Their character may be
+gauged by noting from the "Historical Register" (Vol. 2, p. 281-2) the
+losses sustained in the four Indian Wars of which a record is preserved.
+In the Northwest Indian Wars (1790 to 1795) 896 persons were killed and
+436 were wounded; in the Seminole War (1817 to 1818) 46 were killed and
+36 were wounded; in the Black Hawk War (1831-2) the killed were 26 and
+the wounded 39; in the Seminole War (1835-1842) 383 were killed and 557
+wounded. These were among the most serious of the Indian Wars and in all
+of them the cost in life and limb was small. Judged on this standard,
+the losses in the Southwest, during the Indian Wars, were, at most,
+trifling. The total outlay that was involved in the conquest of the vast
+domain would not have covered one first class battle of the Great War,
+and yet this outlay added to the territory of the United States
+something like a million square miles containing some of the richest and
+most productive portions of the earth's surface.
+
+This domain was won by a process of military conquest; it was taken from
+the Mexicans and the Indians by force of arms. In order to acquire it,
+it was necessary to drive whole tribes from their villages; to burn; to
+maim; to kill. "St. Louis, New Orleans, St. Augustine, San Antonio,
+Santa Fe and San Francisco are cities that were built by Frenchmen and
+Spaniards; we did not found them but we conquered them." "The Southwest
+was conquered only after years of hard fighting with the original
+owners" (p. 26). "The winning of the West and the Southwest is a stage
+in the conquest of a continent" (p. 27). "This great westward movement
+of armed settlers was essentially one of conquest, no less than of
+colonization" (p. 370).[34] None of the possessors of this territory
+were properly armed or equipped for effective warfare. All of them fell
+an easy prey to the organized might of the Government of the United
+States.
+
+FOOTNOTES:
+
+[27] "The Winning of the West," Theodore Roosevelt. New York, Putnam's,
+1896, vol. 4, p. 262.
+
+[28] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+pp. 171-2.
+
+[29] "History of the United States," James F. Rhoades. New York,
+Macmillan, 1906, vol. I, p. 87.
+
+[30] "Personal Memoirs," U. S. Grant. New York, Century, 1895, vol. I.
+
+[31] "Personal Memoirs," U. S. Grant. New York, Century, 1895, vol. I,
+pp. 115 and 32.
+
+[32] "Historical Register of the United States Army," F. B. Heitman.
+Washington, Govt. Print., vol. 2, p. 282.
+
+[33] "The Story of New Mexico," Horatio O. Ladd. Boston, D. Lothrop Co.,
+1891, p. 333.
+
+[34] "The Winning of the West," Theodore Roosevelt. Vol. I, p. 26, 27,
+and Vol. II, p. 370.
+
+
+
+
+VI. THE BEGINNINGS OF WORLD DOMINION
+
+
+1. _The Shifting of Control_
+
+During the half century that intervened between the War of 1812 and the
+Civil War of 1861 the policy of the United States government was decided
+largely by men who came from south of the Mason and Dixon line. The
+Southern whites,--class-conscious rulers with an institution (slavery)
+to defend,--acted like any other ruling class under similar
+circumstances. They favored Southward expansion which meant more
+territory in which slavery might be established.
+
+The Southerners were looking for a place in the sun where slavery, as an
+institution, might flourish for the profit and power of the
+slave-holding class. Their most effective move in this direction was the
+annexation of Texas and the acquisition of territory following the
+Mexican War. An insistent drive for the annexation of Cuba was cut short
+by the Civil War.
+
+Southern sentiment had supported the Louisiana Purchase of 1803 and the
+Florida Purchase of 1819. From Jefferson's time Southern statesmen had
+been advocating the purchase of Cuba. Filibustering expeditions were
+fitted out in Southern ports with Cuba as an objective; agitation was
+carried on, inside and outside of Congress; between 1850 and 1861 the
+acquisition of Cuba was the question of the day. It was an issue in the
+Campaign of 1853. In 1854 the American ministers to London, France and
+Madrid met at the direction of the State Department and drew up a
+document (the "Ostend Manifesto") dealing with the future of Cuba.
+McMaster summarizes the Manifesto in these words: "The United States
+ought to buy Cuba because of its nearness to our coast; because it
+belonged naturally to that great group of states of which the Union was
+the providential nursery; because it commanded the mouth of the
+Mississippi whose immense and annually growing trade must seek that way
+to the ocean, and because the Union could never enjoy repose, could
+never be secure, till Cuba was within its boundaries." (Vol. viii, pp.
+185-6.) If Spain refused to sell Cuba it was suggested that the United
+States should take it.
+
+The Ostend Manifesto was rejected by the State Department, but it was a
+good picture of the imperialistic sentiment at that time abroad among
+certain elements in the United States.
+
+The Cuban issue featured in the Lincoln-Douglas Debates in 1858. It was
+hotly discussed by Congress in 1859. Only twenty years had passed since
+the United States, by force of arms, had taken from Mexico territory
+that she coveted. Now it was proposed to appropriate territory belonging
+to Spain.
+
+The outbreak of hostilities deferred the project, and when the Civil War
+was over, the slave power was shattered. From that time forward national
+policy was guided by the leaders of the new industrial North.
+
+The process of this change was fearfully wasteful. The shifting of power
+from the old régime to the new cost more lives and a greater expenditure
+of wealth than all of the wars of conquest that had been fought during
+the preceding half century.
+
+The change was complete. The slaves were liberated by Presidential
+Proclamation. The Southern form of civilization--patriarchal and
+feudal--disappeared, and upon its ruins--rapidly in the West; slowly in
+the South--there arose the new structure of an industrial civilization.
+
+The new civilization had no need to look outward for economic advantage.
+Forest tracts, mineral deposits and fertile land afforded ample
+opportunity at home. It was three thousand miles to the Pacific and at
+the end of the journey there was gold! The new civilization therefore
+turned its energies to the problem of subduing the continent and of
+establishing the machinery necessary to provide for its vastly
+increasing needs. A small part of the capital required for this purpose
+came from abroad. Most of it was supplied at home. But the events
+involved in opening up the territory west of the Rockies, of spanning
+the country with steel, and providing outlets for the products of the
+developing industries were so momentous that even the most ambitious
+might fulfill his dreams of conquest without setting foot on foreign
+soil. Territorial aggrandizement was forgotten, and men turned with a
+will to the organization of the East and the exploration and development
+of the West.
+
+The leaders of the new order found time to take over Alaska (1868) with
+its 590,884 square miles. The move was diplomatic rather than economic,
+however, and it was many years before the huge wealth of Alaska was even
+suspected.
+
+
+2. _Hawaii_
+
+The new capitalist interests began to feel the need of additional
+territory toward the end of the nineteenth century. The desirable
+resources of the United States were largely in private hands and most of
+the available free land had been pre-empted. Beside that, there were
+certain interests, like sugar and tobacco, that were looking with
+longing eyes toward the tempting soil and climate of Hawaii, Porto Rico
+and Cuba.
+
+When the South had advocated the annexation of Texas, its statesmen had
+been denounced as expansionists and imperialists. The same fate awaited
+the statesmen of the new order who were favoring the extension of United
+States territory to include some of the contiguous islands that offered
+special opportunities for certain powerful financial interests.
+
+The struggle began over the annexation of Hawaii. After numerous
+attempts to annex Hawaii to the United States a revolution was finally
+consummated in Honolulu in 1893. At that time, under treaty provisions,
+the neutrality of Hawaii was guaranteed by the United States. Likewise,
+"of the capital invested in the islands, two-thirds is owned by
+Americans." This statement is made in "Address by the Hawaiian Branches
+of the Sons of the American Revolution, the Sons of Veterans, and the
+Grand Army of the Republic to their compatriots in America Concerning
+the Annexation of Hawaii." (1897.) These advocates of annexation state
+in the same address that: "The revolution (of 1893) was not the work of
+filibusterers and adventurers, but of the most conservative and
+law-abiding citizens, of the principal tax-payers, the leaders of
+industrial enterprises, etc." The purpose behind the revolution seemed
+clear. Certain business men who had sugar and other products to sell in
+the United States, believed that they would gain, financially, by
+annexation. They engineered the revolution of 1893 and they were
+actively engaged in the agitation for annexation that lasted until the
+treaty of annexation was confirmed by the United States in 1898. The
+matter was debated at length on the floor of the United States Senate,
+and an investigation revealed the essential facts of the case.
+
+The immediate cause of the revolution in 1893 was friction over the
+Hawaiian Constitution. After some agitation, a "Committee of Safety" was
+organized for the protection of life and property on the islands.
+Certain members of the Hawaiian government were in favor of declaring
+martial law, and dealing summarily with the conspirators. The Queen
+seems to have hesitated at such a course because of the probable
+complications with the government of the United States.
+
+The _U. S. S. Boston_, sent at the request of United States Minister
+Stevens to protect American life and property in the Islands, was lying
+in the harbor of Honolulu. After some negotiations between the
+"Committee of Safety" and Minister Stevens, the latter requested the
+Commander of the _Boston_ to land a number of marines. This was done on
+the afternoon of January 16, 1893. Immediately the Governor of the
+Island of Oahu and the Minister of Foreign Affairs addressed official
+communications to the United States Minister, protesting against the
+landing of troops "without permission from the proper authorities."
+Minister Stevens replied, assuming full responsibility.
+
+On the day following the landing of the marines, the Committee of
+Safety, under the chairmanship of Judge Dole, who had resigned as
+Justice of the Supreme Court of Hawaii in order to accept the
+Chairmanship of the Committee, proceeded to the government building, and
+there, under cover of the guns of the United States Marines, who were
+drawn up for the purpose of protecting the Committee against possible
+attack, a proclamation was read, declaring the abrogation of the
+Hawaiian monarchy, and the establishment of a provisional government "to
+exist until terms of union with the United States have been negotiated
+and agreed upon." Within an hour after the reading of this proclamation,
+and while the Queen and her government were still in authority, and in
+possession of the Palace, the Barracks, and the Police Station, the
+United States Minister gave the Provisional Government his recognition.
+
+The Queen, who had 500 soldiers in the Barracks, was inclined to fight,
+but on the advice of her counselors, she yielded "to the superior force
+of the United States of America" until the facts could be presented at
+Washington, and the wrong righted.
+
+Two weeks later, on the first of February, Minister Stevens issued a
+proclamation declaring a protectorate over the islands. This action was
+later repudiated by the authorities at Washington, but on February 15,
+President Harrison submitted a treaty of annexation to the Senate. The
+treaty failed of passage, and President Cleveland, as one of his first
+official acts, ordered a complete investigation of the whole affair.
+
+The Senate Committee on Foreign Relations submitted a report on the
+matter February 26, 1894. Four members referred to the acts of Minister
+Stevens as "active, officious and unbecoming participation in the events
+which led to the revolution." All members of the committee agreed that
+his action in declaring a protectorate over the Islands was unjustified.
+
+The same kind of a fight that developed over the annexation of Texas now
+took place over the annexation of Hawaii. A group of senators, of whom
+Senator R. F. Pettigrew was the most conspicuous figure, succeeded in
+preventing the ratification of the annexation treaty until July 7, 1898.
+Then, ten weeks after the declaration of the Spanish-American War, under
+the stress of the war-hysteria, Hawaii was annexed by a joint resolution
+of Congress.
+
+The Annexation of Hawaii marks a turning point in the history of the
+United States. For the first time, the American people secured
+possession of territory lying outside of the mainland of North America.
+For the first time the United States acquired territory lying within the
+tropics. The annexation of Hawaii was the first imperialistic act after
+the annexation of Texas, more than fifty years before. It was the first
+imperialistic act since the capitalists of the North had succeeded the
+slave-owners of the South as the masters of American public life.
+
+
+3. _The Spanish-American War_
+
+The real test of the imperial intentions of the United States came with
+the Spanish-American War. An old, shattered world empire (Spain) held
+Porto Rico, Cuba and the Philippines. Porto Rico and Cuba were of
+peculiar value to the sugar and tobacco interests of the United States.
+They were close to the mainland, they were enormously productive and,
+furthermore, Cuba contained important deposits of iron ore.
+
+Spain had only a feeble grip on her possessions. For years the natives
+of Cuba and of the Philippines had been in revolt against the Spanish
+power. At times the revolt was covert. Again it blazed in the open.
+
+The situation in Cuba was rendered particularly critical because of the
+methods used by the Spanish authorities in dealing with the rebellious
+natives. The Spaniards were simply doing what any empire does to
+suppress rebellion and enforce obedience, but the brutalities of
+imperialism, as practiced in Cuba by the Spaniards, gave the American
+interventionists their opportunity. Day after day the newspapers carried
+front page stories of Spanish atrocities in Cuba. Day after day the
+ground was prepared for open intervention in the interests of the
+oppressed Cubans. There was more than grim humor in the instructions
+which a great newspaper publisher is reported to have sent his
+cartoonist in Cuba,--"You provide the pictures; we'll furnish the war."
+
+The conflict was precipitated by the blowing up of the United States
+battleship _Maine_ as she lay in the harbor of Havana (February 15,
+1898). It has not been settled to this day whether the _Maine_ was blown
+up from without or within. At the time it was assumed that the ship was
+blown up by the Spanish, although "there was no evidence whatever that
+any one connected with the exercise of Spanish authority in Cuba had had
+so much as guilty knowledge of the plans made to destroy the _Maine_"
+(p. 270), and although "toward the last it had begun to look as if the
+Spanish Government were ready, rather than let the war feeling in the
+United States put things beyond all possibility of a peaceful solution,
+to make very substantial concessions to the Cuban insurgents and bring
+the troubles of the Island to an end" (p. 273-4).[35]
+
+Congress, in a joint resolution passed April 20, 1898, declared that
+"the people of the Island of Cuba are, and of right ought to be, free
+and independent.... The United States hereby disclaims any intention to
+exercise sovereignty, jurisdiction or control over said island except
+for the pacification thereof, and asserts its determination, when that
+is accomplished, to leave the government and control of the island to
+its people."
+
+The war itself was of no great moment. There was little fighting on
+land, and the naval battles resulted in overwhelming victories for the
+American Navy. The treaty, ratified February 6, 1899, provided that
+Spain should cede to the United States Guam, Porto Rico, Cuba and the
+Philippines, and that the United States should pay to Spain twenty
+millions of dollars. As in the case of the Mexican War, the United
+States took possession of the territory and then paid a bonus for a
+clear title.
+
+The losses in the war were very small. The total number of men who were
+killed in action and who died of wounds was 289; while 3,949 died of
+accidents and disease. ("Historical Register," Vol. 2, p. 187.) The cost
+of the war was comparatively slight. Hostilities lasted from April 21,
+1898 to August 12, 1898. The entire military and naval expense for the
+year 1898 was $443,368,000; for the year 1899, $605,071,000. Again the
+need for a larger place in the sun had been felt by the people of the
+United States and again the United States had won immense riches with a
+tiny outlay in men and money.
+
+Now came the real issue,--What should the United States do with the
+booty?
+
+There were many who held that the United States was bound to set the
+peoples of the conquered territory free. To be sure the specific pledge
+contained in the joint resolution of April 20, 1898, applied to Cuba
+alone, but, it was argued, since the people of the Philippines had also
+been fighting for liberty, and since they had come so near to winning
+their independence from the Spaniards, they were likewise entitled to
+it.
+
+On the other hand, the advocates of annexation insisted that it was the
+duty of the United States to accept the responsibilities (the "white
+man's burden") that the acquisition of these islands involved.
+
+As President McKinley put it:--"The Philippines, like Cuba and Porto
+Rico, were entrusted to our hands by the providence of God." (President
+McKinley, Boston, February 16, 1899.) How was the country to avoid such
+a duty?
+
+Thus was the issue drawn between the "imperialists" and the
+"anti-imperialists."
+
+The imperialists had the machinery of government, the newspapers, and
+the prestige of a victorious and very popular war behind them. The
+anti-imperialists had half a century of unbroken tradition; the accepted
+principles of self-government; the sayings of men who had organized the
+Revolution of 1776; written the Declaration of Independence; held
+exalted offices and piloted the nation through the Civil War.
+
+The imperialists used their inside position. The anti-imperialists
+appealed to public opinion. They organized a league "to aid in holding
+the United States true to the principles of the Declaration of
+Independence. It seeks the preservation of the rights of the people as
+guaranteed to them by the Constitution. Its members hold self-government
+to be fundamental, and good government to be but incidental. It is its
+purpose to oppose by all proper means the extension of the sovereignty
+of the United States over subject peoples. It will contribute to the
+defeat of any candidate or party that stands for the forcible
+subjugation of any people." (From the declaration of principle printed
+on the literature in 1899 and 1900.) Anti-imperialist conferences were
+held in New York, Philadelphia, Chicago, Indianapolis, Boston and other
+large cities. The League claimed to have half a million members. An
+extensive pamphlet literature was published, and every effort was made
+to arouse the people of the country to the importance of the decision
+that lay before them.
+
+The imperialists said a great deal less than their opponents, but they
+were more effective in their efforts. The President had said, in his
+message to Congress (April 1, 1898), "I speak not of forcible
+annexation, for that cannot be thought of. That, by our code of morals,
+would be criminal aggression." The phrase was seized eagerly by those
+who were opposing the annexation of the Spanish possessions. After the
+war with Spain had begun, the President changed front on the ground that
+destiny had placed a responsibility upon the American people that they
+could not shirk. Taking this view of the situation, the President had
+only one course open to him--to insist upon the annexation of the
+Philippines, Porto Rico and Guam. This was the course that was followed,
+and on April 11, 1899, these territories were officially incorporated
+into the United States.
+
+Senator Hoar, in a speech on January 9, 1899, put the issue squarely. He
+described it as "a greater danger than we have encountered since the
+Pilgrims landed at Plymouth--the danger that we are to be transformed
+from a republic, founded on the Declaration of Independence, guided by
+the counsels of Washington, into a vulgar, commonplace empire, founded
+upon physical force."
+
+Cuba remained to be disposed of. With the specific guarantee of
+independence contained in the joint resolution passed at the outbreak of
+the war, it seemed impossible to do otherwise than to give the Cubans
+self-government. Many influential men lamented the necessity, but it was
+generally conceded. But how much independence should Cuba have? That
+question was answered by the passage of the Cuban Treaty with the "Platt
+Amendment" attached. Under the treaty as ratified the United States does
+exercise "sovereignty, jurisdiction and control" over the island.
+
+
+4. _The Philippines_
+
+The territory acquired from Spain was now, in theory, disposed of.
+Practically, the Philippines remained as a source of difficulty and even
+of political danger.
+
+The people of Cuba were, apparently, satisfied. The Porto Ricans had
+accepted the authority of the United States without question. But the
+Filipinos were not content. If the Cubans were to have self-government,
+why not they?
+
+The situation was complicated by the peculiar relations existing between
+the Filipinos and the United States Government. Immediately after the
+declaration of war with Spain the United States Consul-General at
+Singapore had cabled to Admiral Dewey at Hong Kong that Aguinaldo,
+leader of the insurgent forces in the Philippines, was then at
+Singapore, and was ready to go to Hong Kong. Commodore Dewey cabled back
+asking Aguinaldo to come at once to Hong Kong. Aguinaldo left Singapore
+on April 26, 1898, and, with seventeen other revolutionary Filipino
+chiefs, was taken from Hong Kong to Manila in the United States naval
+vessel _McCulloch_. Upon his arrival in Manila, he at once took charge
+of the insurgents.
+
+For three hundred years the inhabitants of the Philippines had been
+engaged in almost incessant warfare with the Spanish authorities. In the
+spring of 1898 they were in a fair way to win their independence. They
+had a large number of men under arms--from 20,000 to 30,000; they had
+fought the Spanish garrisons to a stand-still, and were in practical
+control of the situation.
+
+Aguinaldo was furnished with 4,000 or 5,000 stands of arms by the
+American officials, he took additional arms from the Spaniards and he
+and his people coöperated actively with the Americans in driving the
+Spanish out of Luzon. The Filipino army captured Iloilo, the second
+largest city in the Philippines, without the assistance of the
+Americans. On the day of the surrender of Manila, 15½ miles of the
+surrounding line was occupied by the Filipinos and 600 yards by the
+American troops. Throughout the early summer, the relations between the
+Filipinos and the Americans continued to be friendly. General Anderson,
+in command of the American Army, wrote a letter to the commander of the
+Filipinos (July 4, 1898) in which he said,--"I desire to have the most
+amicable relations with you and to have you and your people coöperate
+with us in military operations against the Spanish forces." During the
+summer the American officers called upon the Filipinos for supplies and
+information and accepted their coöperation. Aguinaldo, on his part,
+treated the Americans as deliverers, and in his proclamations referred
+to them as "liberators" and "redeemers."
+
+The Filipinos, at the earliest possible moment, organized a government.
+On June 18 a republic was proclaimed; on the 23rd the cabinet was
+announced; on the 27th a decree was published providing for elections,
+and on August 6th an address was issued to foreign governments,
+announcing that the revolutionary government was in operation, and was
+in control of fifteen provinces.
+
+The real intent of the Americans was foreshadowed in the instructions
+handed by President McKinley to General Wesley Merritt on May 19, 1898.
+General Merritt was directed to inform the Filipinos that "we come not
+to make war upon the people of the Philippines, nor upon any party or
+faction among them, but to protect them in their homes, in their
+employments, and in their personal and religious rights. Any persons
+who, either by active aid or by honest submission, coöperate with the
+United States in its effort to give effect to this beneficent purpose,
+will receive the reward of its support and protection."
+
+The Filipinos sent a delegation to Paris to lay their claims for
+independence before the Peace Commission. Meeting with no success, they
+visited Washington, with no different result. They were not to be free!
+
+On September 8, 1898, General Otis, commander of the American forces in
+the Philippines, notified Aguinaldo that unless he withdrew his forces
+from Manila and its suburbs by the 15th "I shall be obliged to resort to
+forcible action." On January 5, 1899, by Presidential Proclamation,
+McKinley ordered that "The Military Government heretofore maintained by
+the United States in the city, harbor, and bay of Manila is to be
+extended with all possible dispatch to the whole of the ceded
+territory." On February 4, 1899, General Otis reported "Firing upon the
+Filipinos and the killing of one of them by the Americans, leading to
+return fire." (Report up to April 6, 1899.) Then followed the Philippine
+War during which 1,037 Americans were killed in action or died of
+wounds; 2,818 were wounded, and 2,748 died of disease. ("Historical
+Register," Vol. II, p. 293.)
+
+The Philippines were conquered twice--once in a contest with Spain (in
+coöperation with the Filipinos, who regarded themselves as our allies),
+and once in a contest with the Filipinos, the native inhabitants, who
+were made subjects of the American Empire by this conquest.[36]
+
+
+5. _Imperialism Accepted_
+
+The Philippine War was the last political episode in the life of the
+American Republic. From February 4, 1899, the United States accepted the
+political status of an Empire. Hawaii had been annexed at the behest of
+the Hawaiian Government; Porto Rico had been occupied as a part of the
+war strategy and without any protest from the Porto Ricans. The
+Philippines were taken against the determined opposition of the natives,
+who continued the struggle for independence during three bitter years.
+
+The Filipinos were fighting for independence--fighting to drive invaders
+from their soil. The United States authorities had no status in the
+Philippines other than that of military conquerors.
+
+Continental North America was occupied by the whites after a long
+struggle with the Indian tribes. This territory was "conquered"--but it
+was contiguous--it formed a part of a geographic unity. The Philippines
+were separated from San Francisco by 8,000 miles of water;
+geographically they were a part of Asia. They were tropical in
+character, and were inhabited by tribes having nothing in common with
+the American people except their common humanity. Nevertheless, despite
+non-contiguity; despite distance; despite dissimilarity in languages and
+customs, the soldiers of the United States conquered the Filipinos and
+the United States Government took control of the islands, acting in the
+same way that any other empire, under like circumstances, unquestionably
+would have acted.
+
+There was no strategic reason that demanded the Philippines unless the
+United States desired to have an operating base near to the vast
+resources and the developing markets of China. As a vantage point from
+which to wage commercial and military aggression in the Far East, the
+Philippines may possess certain advantages. There is no other excuse for
+their conquest and retention by the United States save the economic
+excuse of advantages to be gained from the possession of the islands
+themselves.
+
+The end of the nineteenth century saw the end of the Republic about
+which men like Jefferson and Lincoln wrote and dreamed. The New Century
+marked the opening of a new epoch--the beginning of world dominion for
+the United States.
+
+FOOTNOTES:
+
+[35] "A History of the American People," Woodrow Wilson. New York,
+Harpers, 1902, Vol. V, pp. 273-4.
+
+[36] For further details on the Philippine problem see Senate Document
+62, Part I, 55th Congress, Third Session.
+
+
+
+
+VII. THE STRUGGLE FOR WEALTH AND POWER
+
+
+1. _Economic Foundations_
+
+The people of the United States, through their contests with the
+American Indians, the Mexicans and the Filipinos, have established that
+"supreme and extensive political domination" which is one of the chief
+characteristics of empire.
+
+But the American Empire does not rest upon a political basis. Only the
+most superficial portions of its superstructure are political in
+character. Imperialism in the United States, as in every other modern
+country, is built not upon politics, but upon industry.
+
+The struggle between empires has shifted, in recent years, from the
+political and the military to the economic field. The old imperialism
+was based on military conquest and political domination. The new
+"financial" imperialism is based on economic opportunities and
+advantages. Under this new régime, territorial domination is
+subordinated to business profit.
+
+While American public officials were engaged in the routine task of
+extending the political boundaries of the United States, the foundations
+of imperial strength were being laid by the masters of industrial
+life--the traders, manufacturers, bankers, the organizers of trusts and
+of industrial combinations. These owners and directors of the nation's
+wealth have been the real builders of the American Empire.
+
+As the United States has developed, the economic motives have come more
+and more to the surface, until no modern nation--not England
+herself--has such a record in the search for material possessions. The
+pursuit of wealth, in the United States, has been carried forward
+ruthlessly; brutally. "Anything to win" has been the motto. Man against
+man, and group against group, they have struggled for gain,--first, in
+order to "get ahead;" then to accumulate the comforts and luxuries, and
+last of all, to possess the immense power that goes with the control of
+modern wealth.
+
+The early history of the country presaged anything but this. The
+colonists were seeking to escape tyranny, to establish justice and to
+inaugurate liberty. Their promises were prophetic. Their early deeds put
+the world in their debt. Forward looking people everywhere thrilled at
+the mention of the name "America." Then came the discovery of the
+fabulous wealth of the new country; the pressure of the growing stream
+of immigrants; the heaping up of riches; the rapacious search after
+more! more! the desertion of the dearest principles of America's early
+promise, and the transcribing of another story of "economic
+determinism."
+
+Until very recent times the American people continued to talk of
+political affairs as though they were the matters of chief public
+concern. The recent growth and concentration of economic power have
+showed plainly, however, that America was destined to play her greatest
+rôle on the economic field. Capable men therefore ceased to go into
+politics and instead turned their energies into the whirl of business,
+where they received a training that made them capable of handling
+affairs of the greatest intricacy and magnitude.
+
+
+2. _Every Man for Himself_
+
+The development of American industry, during the hundred years that
+began with the War of 1812, led inevitably to the unification of
+business control in the hands of a small group of wealth owners.
+
+"Every man for himself" was the principle that the theorists of the
+eighteenth century bequeathed to the industrial pioneers of the
+nineteenth. The philosophy of individualism fitted well with the
+temperament and experience of the English speaking peoples; the practice
+of individualism under the formula "Every man for himself" seemed a
+divine ordination for the benefit of the new industry.
+
+The eager American population adopted the slogan with enthusiasm. "Every
+man for himself" was the essence of their frontier lives; it was the
+breath of the wilderness.
+
+But the idea failed in practice. Despite the assurances of its champions
+that individualism was necessary to preserve initiative and that
+progress was impossible without it, like many another principle--fine
+sounding in theory, it broke down in the application.
+
+The first struggle that confronted the ambitious conqueror of the new
+world was the struggle with nature. Her stores were abundant, but they
+must be prepared for human use. Timber must be sawed; soil tilled; fish
+caught; coal mined; iron smelted; gold extracted. Rivers must be
+bridged; mountains spanned; lines of communication maintained. The
+continent was a vast storehouse of riches--potential riches. Before they
+could be made of actual use, however, the hand of man must transform
+them and transport them.
+
+These necessary industrial processes were impossible under the "every
+man for himself" formula. Here was a vast continent, with boundless
+opportunities for supplying the necessaries and comforts of
+life--provided men were willing to come together; divide up the work;
+specialize; and exchange products.
+
+Coöperation--alone--could conquer nature. The basis of this coöperation
+proved to be the machine. Its means was the system of production and
+transportation built upon the use of steam, electricity, gas, and labor
+saving appliances.
+
+When the United States was discovered, the shuttle was thrown by hand;
+the hammer was wielded by human arm; the mill-stones were turned by wind
+and water; the boxes and bales were carried by pack-animals or in
+sailing vessels,--these processes of production and transportation were
+conducted in practically the same way as in the time of Pharaoh or of
+Alexander the Great. A series of discoveries and inventions, made in
+England between 1735 and 1784, substituted the machine for the tool; the
+power of steam for the power of wind, water or human muscle; and set up
+the factory to produce, and the railroad and the steamboat to transport
+the factory product.
+
+American industry, up to 1812, was still conducted on the old,
+individualistic lines. Factories were little known. Men worked singly,
+or by twos and threes in sheds or workrooms adjoining their homes. The
+people lived in small villages or on scattered farms. Within the century
+American industry was transformed. Production shifted to the factory;
+about the factory grew up the industrial city in which lived the tens or
+hundreds of thousands of factory workers and their families.
+
+The machine made a new society. The artisan could not compete with the
+products of the machine. The home workshop disappeared, and in its place
+rose the factory, with its tens, its hundreds and its thousands of
+operatives.
+
+Under the modern system of machine production, each person has his
+particular duty to perform. Each depends, for the success of his
+service, upon that performed by thousands of others.
+
+All modern industry is organized on the principle of coöperation,
+division of labor, and specialization. Each has his task, and unless
+each task is performed the entire system breaks down.
+
+Never were the various branches of the military service more completely
+dependent upon each other than are the various departments of modern
+economic life. No man works alone. All are associated more or less
+intimately with the activities of thousands and millions of their
+fellows, until the failure of one is the failure of all, and the success
+of one is the success of all.
+
+Such a development could have only one possible result,--people who
+worked together must live together. Scattered villages gave place to
+industrial towns and cities. People were compelled to coöperate in their
+lives as well as in their labor.
+
+The theory under which the new industrial society began its operations
+was "every man for himself." The development of the system has made
+every man dependent upon his fellows. The principle demanded an extreme
+individualism. The practice has created a vast network of
+inter-relations, that leads the cotton spinner of Massachusetts to eat
+the meat prepared by the packing-house operative in Omaha, while the
+pottery of Trenton and the clothing of New York are sent to the Yukon in
+exchange for fish and to the Golden Gate for fruit. Inside as well as
+outside the nation, the world is united by the strong hands of economic
+necessity. None can live to himself, alone. Each depends upon the labor
+of myriads whom he has never seen and of whom he has never heard.
+Whether we will or no, they are his brothers-in-labor--united in the
+Atlas fellowship of those who carry the world upon their shoulders.
+
+The theory of "every man for himself" failed. The practical exigencies
+involved in subjugating a continent and wresting from nature the means
+of livelihood made it necessary to introduce the opposite
+principle,--"In Union there is strength; coöperation achieves all
+things."
+
+
+3. _The Struggle for Organization_
+
+The technical difficulties involved in the mechanical production of
+wealth compelled even the individualists to work together. The
+requirements of industrial organization drove them in the same
+direction.
+
+The first great problem before the early Americans was the conquest of
+nature. To this problem the machine was the answer. The second problem
+was the building of an organization capable of handling the new
+mechanism of production--an organization large enough, elastic enough,
+stable enough and durable enough--to this problem the corporation was
+the answer.
+
+The machine produced the goods. The corporation directed the production,
+marketed the products and financed both operations.
+
+The corporation, as a means of organizing and directing business
+enterprise is a product of the last hundred years. A century ago the
+business of the United States was carried on by individuals,
+partnerships, and a few joint stock companies. At the time of the last
+Census, more than four-fifths of the manufactured products were turned
+out under corporate direction; most of the important mining enterprises
+were corporate, and the railroads, public utilities, banks and insurance
+companies were virtually all under the corporate form of organization.
+Thus the passage of a century has witnessed a complete revolution in the
+form of organizing and directing business enterprise.
+
+The corporation, as a form of business organization is immensely
+superior to individual management and to the partnership.
+
+1. The corporation has perpetual life. In the eyes of the law, it is a
+person that lives for the term of its charter. Individuals die;
+partnerships are dissolved; but the corporation with its unbroken
+existence, possesses a continuity and a permanence that are impossible
+of attainment under the earlier forms of business organization.
+
+2. Liability, under the corporation, is limited by the amount of the
+investment. The liability of an individual or a partner engaged in
+business was as great as his ability to pay. The investor in a
+corporation cannot lose a sum larger than that represented by his
+investment.
+
+3. The corporation, through the issuing of stocks and bonds, makes it
+possible to subdivide the total amount invested in one enterprise into
+many small units.[37] These chances for small investment mean that a
+large number of persons may join in subscribing the capital for a
+business enterprise. They also mean that one well-to-do person may
+invest his wealth in a score or a hundred enterprises, thus reducing the
+risk of heavy losses to a minimum.
+
+4. The corporation is not, as were the earlier forms of organization,
+necessarily a "one man" concern. Many corporations have upon their
+boards of directors the leading business men, merchants, bankers and
+financiers. In this way, the investing public has the assurance that the
+enterprise will be conducted along business lines, while the business
+men on the board have an opportunity to get in on the "ground floor."
+
+The corporation has a permanence, a stability, and a breadth of
+financial support that are quite impossible in the case of the private
+venture or of the partnership. It does for business organization what
+the machine did for production.
+
+The corporation came into favor at a time when business was expanding
+rapidly. Surplus was growing. Wealth and capital were accumulating.
+Industrial units were increasing in size. It was necessary to find some
+means by which the surplus wealth in the hands of many individuals could
+be brought together, large sums of capital concentrated under one
+unified control, the investments, thus secured, safeguarded against
+untoward losses, and the business conservatively and efficiently
+directed. The corporation was the answer to these needs.
+
+"United we stand" proved to be as true of organizers and investors as it
+was of producers. The corporation was the common denominator of people
+with various industrial and financial interests.
+
+The corporation played another rôle of vital consequence. It enabled the
+banker to dominate the business world. Heretofore, the banker had dealt
+largely with exchange. The industrial leader was his equal if not his
+superior. The organization of the corporation put the supreme power in
+the hands of the banker, who as the intermediary between investor and
+producer, held the purse strings.
+
+
+4. _Capitalist against Capitalist_
+
+The early American enterprisers--the pioneers--began a single-handed
+struggle with nature. Necessity forced them to coöperate. They
+established a new industry. The factory brought them together. They
+organized their system of industrial direction and control. The
+corporation united them. They turned on one another in mortal combat,
+and the frightfulness of their losses forced them to join hands.
+
+The business men of the late nineteenth century had been nurtured upon
+the idea of competition. "Every man for himself and the devil take the
+hindermost" summed up their philosophy. Each person who entered the
+business arena was met by an array of savage competitors whose motto was
+"Victory or Death." In the struggle that followed, most of them suffered
+death.
+
+Capitalist set himself up against capitalist in bitter strife. The
+railroads gouged the farmers, the manufacturers and the merchants and
+fought one another. The big business organizations drove the little man
+to the wall and then attacked their larger rivals. It was a fight to the
+finish with no quarter asked or given.
+
+The "finish" came with periodic regularity in the seventies, the
+eighties and the nineties. The number of commercial failures in 1875 was
+double the number of 1872. The number of failures in 1878 was over three
+times that of 1871. The same thing happened in the eighties. The
+liabilities of concerns failing in 1884 were nearly four times the
+liabilities of those failing in 1880. The climax came in the nineties,
+after a period of comparative prosperity. Hard times began in 1893.
+Demand dropped off. Production decreased. Unemployment was widespread.
+Wages fell. Prices went down, down, under bitter competitive selling,
+to touch rock bottom in 1896. Business concerns continued to fight one
+another, though both were going to the wall. Weakened by the struggle,
+unable to meet the competitive price cutting that was all but the
+universal business practice of the time, thousands of business houses
+closed their doors. The effect was cumulative; the fabric of credit,
+broken at one point, was weakened correspondingly in other places and
+the guilty and the innocent were alike plunged into the morass of
+bankruptcy.
+
+The destruction wrought in the business world by the panic of 1893 was
+enormous. The number of commercial failures for 1893 jumped to 15,242.
+The amount of liabilities involved in these failures was $346,780,000.
+This catastrophe, coming as it did so close upon the heels of the panics
+that had immediately preceded it, could not fail to teach its lesson.
+Competition was not the life, but the death of trade. "Every man for
+himself" as a policy applied in the business world, led most of those
+engaged in the struggle over the brink to destruction. There was but one
+way out--through united action.
+
+The period between 1897 and 1902 was one of feverish activity directed
+to coördinating the affairs of the business world. Trusts were formed in
+all of the important branches of industry and trade. The public looked
+upon the trust as a means of picking pockets through trade conspiracies
+and the boosting of prices. The Sherman Anti-Trust Law had been passed
+on that assumption. In reality, the trusts were organized by far seeing
+men who realized that competition was wasteful in practice and unsound
+in theory. The idea that the failure of one bank or shoe factory was of
+advantage to other banks and shoe factories, had not stood the test of
+experience. The tragedies of the nineties had showed conclusively that
+an injury to one part of the commercial fabric was an injury to all of
+its parts.
+
+The generation of business men trained since 1900 has had no illusions
+about competition. Rather, it has had as its object the successful
+combination of various forms of business enterprise into ever larger
+units. First, there was the uniting of like industries;--cotton mills
+were linked with cotton mills, mines with mines. Then came the
+integration of industry--the concentration under one control of all of
+the steps in the industrial process from the raw material to the
+finished product,--iron mines, coal mines, blast furnaces, converters,
+and rail mills united in one organization to take the raw material from
+the ground and to turn out the finished steel product. Last of all there
+was the union of unlike industries,--the control, by one group of
+interests, of as many and as varied activities as could be brought
+together and operated at a profit. The lengths to which business men
+have gone in combining various industries is well shown by the recent
+investigation of the meat packing industry. In the course of that
+investigation, the Federal Trade Commission was able to show that the
+five great packers (Wilson, Armour, Swift, Morris and Cudahy) were
+directly affiliated with 108 business enterprises, including 12
+rendering companies; 18 stockyard companies; 8 terminal railway
+companies; 9 manufacturers of packers' machinery and supplies; 6 cattle
+loan companies; 4 public service corporations; 18 banks, and a number of
+miscellaneous companies, and that they controlled 2000 food products not
+immediately related to the packing industry.[38]
+
+Business is consolidated because consolidation pays--not primarily,
+through the increase of prices, but through the greater stability, the
+lessened costs, and the growing security that has accompanied the
+abolition of competition.
+
+Again the forces of social organization have triumphed in the face of an
+almost universal opposition. American business men practiced competition
+until they found that coöperation was the only possible means of
+conducting large affairs. Theory advised, "Compete"! Experience warned,
+"Combine"! Business men--like all other practical people--accepted the
+dictates of experience as the only sound basis for procedure. Their
+combination solidified their ranks, preparing them to take their places
+in a closely knit, dominant class, with clearly marked interests, and a
+strong feeling of class consciousness and solidarity.
+
+It was in the consummation of these combinations, integrations and
+consolidations that the investment banker came into his own as the
+keystone in the modern industrial arch.
+
+
+5. _The Investment Banker_
+
+The investment banker is the directing and coördinating force in the
+modern business world. The necessities of factory production demanding
+great outlays of capital; the immense financial requirements of
+corporations; the consolidation of business ventures on a huge scale;
+the broadened use of corporate securities as investments--all brought
+the investment banker into the foreground.
+
+Before the Spanish War, the investment banker financed the trusts. After
+the war he was entrusted with the vast surpluses which the concentration
+of business control had placed in a few hands. Business consolidation
+had given the banker position. The control of the surplus brought him
+power. Henceforth, all who wished access to the world of great
+industrial and commercial affairs must knock at his door.
+
+This concentration of economic control in the hands of a relatively
+small number of investment bankers has been referred to frequently as
+the "Money Trust."
+
+Investment banking monopoly, or as it is sometimes called, the "Money
+Trust" was examined in detail by the Pujo Committee of the House of
+Representatives, which presented a summary of its report on February 28,
+1913. The committee placed, at the center of its diagram of financial
+power, J. P. Morgan & Co., the National City Bank, the First National
+Bank, the Guaranty Trust Co., and the Bankers Trust Co., all of New
+York. The report refers to Lee, Higginson & Co., of Boston and New
+York; to Kidder, Peabody & Co., of Boston and New York, and to Kuhn,
+Loeb & Co., of New York, together with the Morgan affiliations, as being
+"the most active agents in forwarding and bringing about the
+concentration of control of money and credit" (p. 56).
+
+The methods by which this control was effected are classed by the
+Committee under five heads:--
+
+1. "Through consolidations of competitive or potentially competitive
+banks and trust companies which consolidations in turn have recently
+been brought under sympathetic management" (p. 56).
+
+2. Through the purchase by the same interests of the stock of
+competitive institutions.
+
+3. Through interlocking directorates.
+
+4. "Through the influence which the more powerful banking houses, banks,
+and trust companies have secured in the management of insurance
+companies, railroads, producing and trading corporations and public
+utility corporations, by means of stock holdings, voting trusts, fiscal
+agency contracts, or representation upon their boards of directors, or
+through supplying the money requirements of railway, industrial, and
+public utility corporations and thereby being enabled to participate in
+the determination of their financial and business policies" (p. 56).
+
+5. "Through partnership or joint account arrangements between a few of
+the leading banking houses, banks, and trust companies in the purchase
+of security issues of the great interstate corporations, accompanied by
+understandings of recent growth--sometimes called 'banking
+ethics'--which have had the effect of effectually destroying competition
+between such banking houses, banks, and trust companies in the struggle
+for business or in the purchase and sale of large issues of such
+securities" (p. 56).
+
+Morgan & Co., the First National Bank, the National City Bank, the
+Bankers Trust Co., and the Guaranty Trust Co., which were all closely
+affiliated, had extended their control until they held,--
+
+
+     118 directorships in 34 banks with combined resources of
+     $2,679,000,000.
+
+     30 directorships in 10 insurance companies with total assets of
+     $2,293,000,000.
+
+     105 directorships in 32 transportation systems having a total
+     capital of $11,784,000,000.
+
+     63 directorships in 24 producing and trading companies having a
+     total capitalization of $3,339,000,000.
+
+     25 directorships in 12 public utility corporations with a total
+     capitalization of $2,150,000,000.
+
+
+The investment banker had become, what he was ultimately bound to be,
+the center of the system built upon the century-long struggle to control
+the wealth of the continent in the interest of the favored few who
+happened to own the choicest natural gifts.
+
+
+6. _The Cohesion of Wealth_
+
+The struggle for wealth and power, actively waged among the business men
+of the United States for more than a century, has thus by a process of
+elimination, subordination and survival, placed a few small groups of
+strong men in a position of immense economic power. The growth of
+surplus and its importance in the world of affairs has made the
+investment banker the logical center of this business leadership. He,
+with his immediate associates, directs and controls the affairs of the
+economic world.
+
+The spirit of competition ruled the American business world at the
+beginning of the last century, the forces of combination dominated at
+its close. The new order was the product of necessity, not of choice.
+The life of the frontier had ingrained in men an individualism that
+chafed under the restraints of combination. It was the compelling
+forces of impending calamity and the opportunity for greater economic
+advantage--not the traditions or accepted standards of the business
+world--that led to the establishment of the centralized wealth power.
+American business interests were driven together by the battering of
+economic loss and lured by the hope of greater economic gains.
+
+Years of struggle and experience, by converting a scattered,
+individualistic wealth owning class into a highly organized, closely
+knit, homogeneous group with its common interests in the development of
+industry and the safeguarding of property rights, have brought unity and
+power to the business world.
+
+Individually the members of the wealth-controlling class have learned
+that "in union there is strength"; collectively they are gripped by the
+"cohesion of wealth"--the class conscious instinct of an associated
+group of human beings who have much to gain and everything to lose.
+
+FOOTNOTES:
+
+[37] The 169 largest railroads in the United States have issued
+84,418,796 shares of stock. ("American Labor Year Book," 1917-18, p.
+169.) Theoretically, therefore, there might be eighty-four millions of
+owners of the American railroads.
+
+[38] Summary of the Report of the Federal Trade Commission on the Meat
+Packing Industry, July 3, 1918, Wash., Govt. Print., 1918.
+
+
+
+
+VIII. THEIR UNITED STATES
+
+
+1. _Translating Wealth into Power_
+
+The first object of the economic struggle is wealth. The second is
+power.
+
+At the end of their era of competition, the leaders of American business
+found themselves masters of such vast stores of wealth that they were
+released from the paralyzing fear of starvation, and were guaranteed the
+comforts and luxuries of life. Had these men sought wealth as a means of
+satisfying their physical needs their object would have been attained.
+
+The gratification of personal wants is only a minor element in the lives
+of the rich. After they have secured the things desired, they strive for
+the power that will give them control over their fellows.
+
+The possession of things, is, in itself, a narrow field. The control
+over productive machinery gives him who exercises it the power to enjoy
+those things which the workers with machinery produce. The control over
+public affairs and over the forces that shape public opinion give him
+who exercises it the power to direct the thoughts and lives of the
+people. It is for these reasons that the keen, self-assertive, ambitious
+men who have come to the top in the rough and tumble of the business
+struggle have steadily extended their ownership and their control.
+
+
+2. _The Wealth of the United States_
+
+The bulk of American wealth, which consists for the most part of land
+and buildings, is concentrated in the centers of commerce and
+industry--in the regions of supreme business power.
+
+The last detailed estimate of the wealth of the United States was made
+by the Census Bureau for the year 1912. At that time, the total wealth
+of the country was placed at $187,739,000,000. (The estimate for 1920 is
+$500,000,000,000.) Roughly speaking, this represented an estimate of
+exchangeable values. The figures, at best, are rough approximations.
+Their importance lies, not in their accuracy, but in the picture which
+they give of relationships.
+
+
+The Total Wealth of the United States, Classified by Groups, with the
+Percentage of the Total Wealth in Each Group[39]
+
+
+                                               _Total Estimated
+                                                    Wealth_
+
+                                             _Amount_
+                                             (000,000   _Per Cent_
+             _Wealth Groups_                _Omitted_)   _of Total_
+
+     1. Real Property (land and buildings)   $110,676       59
+
+     2. Public Utilities (railroads, street
+     railways, telegraph, telephone,
+     electric light, etc.)                     26,415       14
+
+     3. Live Stock and Machinery (live
+     stock, farm implements and manufacturing
+     machinery)                                13,697        7
+
+     4. Raw Materials, Manufactured Products,
+     Merchandise (including
+     gold and silver bullion)                  24,193       13
+
+     5. Personal Possessions (clothing,
+     personal adornments, furniture,
+     carriages, etc.)                          12,758        7
+
+     Total of all groups                     $187,739      100
+
+
+The bulk of the exchangeable wealth of the United States consists of
+"productive" or "investment" property. If, to the total of 110 billions
+given by the Census as the value of real property, are added the real
+property values of the public utilities, the total will probably exceed
+three quarters of the total wealth of the United States. If, in
+addition, account is taken of the fact that much of the wealth classed
+as "raw materials, etc.," is the immediate product of the land (coal,
+ore, timber), some idea may be obtained of the extent to which the
+estimated wealth of the country is in the form of land, its immediate
+products, and buildings. Furthermore, it must be remembered that great
+quantities of ore lands, timber lands, waterpower sites, etc., are
+assessed at only a fraction of their total present value.
+
+The personal property of the country is valued at less than one
+fourteenth of the total wealth. It is in reality a negligible item, as
+compared with the value of the real property, of the public utilities,
+and of the raw materials and products of industry.
+
+The wealth of the United States is in permanent form--land and
+improvements; personal possessions are a mere incident in the total. In
+truth, American wealth is in the main productive (business) wealth,
+designed for the further production of goods, rather than for the
+satisfaction of human wants.
+
+
+3. _Ownership and Control_
+
+Who owns this vast wealth? It is impossible to answer the question with
+anything like definiteness. Figures have been compiled to show that five
+per cent of the people own two-thirds to three-quarters of it; that the
+poorest two-thirds of the people own five per cent of it, and that the
+well-to-do or middle class own the remainder. These figures would make
+it appear that more than one-fourth of the population is in the middle
+class. If the income-tax returns are to be trusted this proportion is
+far too high. On all hands it is admitted that the wealth of the
+country is concentrated in the hands of a small fraction of the people
+and the important wealth--that is, the wealth upon which production,
+transportation and exchange depends--is in still fewer hands.
+
+Neither the total wealth of the country, nor that portion of the total
+which is owned directly by the propertied class is of most immediate
+moment. Ownership does not necessarily involve control. A puddler in the
+Gary Mills may own five shares of stock in the Steel Corporation without
+ever raising his voice to determine the corporation policy. This is
+ownership without control. On the other hand, a banking house through a
+voting trust agreement, may control the policy of a corporation in which
+it does not own one per cent of the stock. This is control without
+ownership. Ownership may be quite incidental. It is control that counts
+in terms of power.
+
+Most of the property owners in the United States play no part in the
+control of prices or of production, in the direction of economic policy,
+or in the management of economic affairs.
+
+Theoretically, stockholders direct the policies of corporations, and,
+therefore, each holder of 5 or 10 shares of corporate stock would play a
+part in deciding economic affairs. Practically, the small stockholder
+has no part in business control.
+
+The small farmer--the small business man of largest numerical
+consequence--has been exploited by the great interests for two
+generations. Despite his numbers and his organizations, despite his
+frequent efforts, through anti-trust laws, railway control laws, banking
+reform laws, and the like, he has little voice in determining important
+economic policies.
+
+The small savings bank depositor or the holder of an ordinary insurance
+policy is a negative rather than a positive factor in economic control.
+Not only does he exercise no power over the dollar which he has placed
+with the bank or with the insurance company, but he has thereby
+strengthened the hands of these organizations. Each dollar placed with
+the financier is a dollar's more power for him and his.
+
+Suppose--the impossible--that half of the families in the United States
+"own property." Subtract from this number the small stockholders; the
+holders of bonds, notes and mortgages; the small tradesman; the small
+farmer; the home owner and the owner of a savings-bank deposit or of an
+insurance policy--what remains? There are the large stockholders, the
+owners and directors of important industries, public utilities, banks,
+trust companies and insurance companies. These persons, in the
+aggregate, constitute a fraction of one per cent of the adult population
+of the United States.
+
+Start with the total non-personal wealth of the country, subtract from
+it the share-values of the small stockholders; the values of all bonds,
+mortgages and notes; the property of the small tradesman and the small
+farmer; the value of homes--what remains? There are left the stocks in
+the hands of the big stockholders; the properties owned and directed by
+the owners and directors of important industries, public utilities,
+banks, trust companies and insurance companies. This wealth in the
+aggregate probably makes up less than 10 per cent of the total wealth of
+the country and yet the tiny fraction of the population which owns this
+wealth can exercise a dictatorial control over the economic policies
+that underlie American public life.
+
+
+4. _The Avenues of Mastery_
+
+While control rests back directly or indirectly upon some form of
+ownership, most owners exercise little or no control over economic
+affairs. Instead they are made the victims of a social system under
+which one group lives at the expense of another.
+
+Against this tendency toward control by one group or class (usually a
+minority) over the lives of another group or class (usually a majority)
+the human spirit always has revolted. The United States in its earlier
+years was an embodiment of the spirit of that revolt. President Wilson
+characterized it excellently in 1916. Speaking of the American Flag, he
+said,--"That flag was originally stained in very precious blood, blood
+spilt, not for any dynasty, nor for any small controversies over
+national advantage, but in order that a little body of three million men
+in America might make sure that no man was their master."[40]
+
+Against mastery lovers of liberty protest. Mastery means tyranny;
+mastery means slavery.
+
+Mastery has always been based upon some form of ownership. There is in
+the United States a group, growing in size, of people who take more in
+keep than they give in service; people who own land; franchises; stocks
+and bonds and mortgages; real estate and other forms of investment
+property; people who are living without ever lifting a finger in toil,
+or giving anything in labor for an unceasing stream of necessaries,
+comforts and luxuries. These people, directly or indirectly, are the
+owners of the productive machinery of the United States.
+
+Historically there have been a number of stages in the development of
+mastery. First, there was the ownership of the body. One man owned
+another man, as he might own a house or a pile of hides. At another
+stage, the owner of the land--the feudal baron or the landlord--said to
+the tenant, who worked on his land: "You stay on my land. You toil and
+work and make bread and I will eat it." The present system of mastery is
+based on the ownership by one group of people, of the productive wealth
+upon which depends the livelihood of all. The masters of present day
+economic society have in their possession the natural resources, the
+tools, the franchises, patents, and the other phases of the modern
+industrial system with which the people must work in order to live. The
+few who own and control the productive wealth have it in their power to
+say to the many who neither own nor control,--"You may work or you may
+not work." If the masses obtain work under these conditions the owners
+can say to them further,--"You work, and toil and earn bread and we will
+eat it." Thus the few, deriving their power from the means by which
+their fellows must work for a living, own the jobs.
+
+
+5. _The Mastery of Job-Ownership_
+
+Job-ownership is the foundation of the latest and probably the most
+complete system of mastery ever perfected. The slave was held only in
+physical bondage. Behind serfdom there was land ownership and a
+religious sanction. "Divine right" and "God's anointed," were terms used
+to bulwark the position of the owning class, who made an effort to
+dominate the consciences as well as the bodies of their serfs.
+Job-ownership owes its effectiveness to a subtle, psychological power
+that overwhelms the unconscious victim, making him a tool, at once easy
+to handle and easy to discard.
+
+The system of private ownership that succeeded Feudalism taught the
+lesson of economic ambition so thoroughly that it has permeated the
+whole world. The conditions of eighteenth century life have passed,
+perhaps forever, but its psychology lingers everywhere.
+
+The job-holder has been taught that he must "get ahead" in the world;
+that if he practices the economic virtues,--thrift, honesty,
+earnestness, persistence, efficiency--he will necessarily receive great
+economic reward; that he must support his family on the standard set by
+the community, and that to do all of these essential things, he must
+take a job and hold on to it. Having taken the job, he finds that in
+order to hold it, he must be faithful to the job-owner, even if that
+involves faithlessness to his own ideas and ideals, to his health, his
+manhood, and the lives of his wife and children.
+
+The driving power in slavery was the lash. Under serfdom it was the
+fear of hunger. The modern system of job-ownership owes its
+effectiveness to the fact that it has been built upon two of the most
+potent driving forces in all the world--hunger and ambition--the driving
+force that comes from the empty stomach and the driving force that comes
+from the desire for betterment. Thus job-owning, based upon an automatic
+self-drive principle, enables the job-owner to exact a return in
+faithful service that neither slavery nor serfdom ever made possible.
+Job-owning is thus the most thorough-going form of mastery yet devised
+by the ingenuity of man.
+
+Unlike the slave owner and the Feudal lord the modern job-owner has no
+responsibility to the job-holder. The slave owner must feed, clothe and
+house his slave--otherwise he lost his property. The Feudal lord must
+protect and assist his tenant. That was a part of his bargain with his
+overlord. The modern job-owner is at liberty, at any time, to
+"discharge" the job-holder, and by throwing him out of work take away
+his chance of earning a living. While he keeps the job-holder on his
+payroll, he may pay him impossibly low wages and overwork him under
+conditions that are unfit for the maintenance of decent human life.
+Barring the factory laws and the health laws, he is at liberty to impose
+on the job-holder any form of treatment that the job-holder will
+tolerate.
+
+There is no limit to the amount of industrial property that one man may
+own. Therefore, there is no limit to the number of jobs he may control.
+It is possible (not immediately likely) that one coterie of men might
+secure possession of enough industrial property to control the jobs of
+all of the gainfully occupied people in American industry. If this
+result could be achieved, these tens of millions would be able to earn a
+living only in case the small coterie in control permitted them to do
+so.
+
+Job ownership is built, of necessity, on the ownership of land,
+resources, capital, credit, franchises, and other special privileges.
+But its power of control goes far beyond this mere physical ownership
+into the realms of social psychology.
+
+The early colonists, who fled from the economic, political, social and
+religious tyranny of feudalism, believed that liberty and freedom from
+unjust mastery lay in the private ownership of the job. They had no
+thought of the modern industrial machine.
+
+The abolitionists who fought slavery believed that freedom and liberty
+could be obtained by unshackling the body. They did not foresee the
+shackled mind.
+
+The modern world, seeking freedom; yearning for liberty and justice;
+aiming at the overthrow of the mastery that goes with irresponsible
+power, finds to its dismay that the ownership of the job carries with
+it, not only economic mastery, but political, social and even religious
+mastery, as well.
+
+
+6. _The Ownership of the Product_
+
+The industrial overlord holds control of the job with one hand. With the
+other he controls the product of industry. From the time the raw
+material leaves the earth in the form of iron ore, crude petroleum,
+logs, or coal, through all of the processes of production, it is owned
+by the industrial master, not by the worker. Workers separate the
+product from the earth, transport it, refine it, fabricate it. Always,
+the product, like the machinery, is the possession of the owning class.
+
+While industry was competitive, the pressure of competition kept prices
+at a cost level, and the exploiting power of the owner was confined to
+the job-holder. To-day, through combinations and consolidations,
+industry has ceased to be competitive, and the exploiting power of the
+job-owner is extended through his ownership of the product.
+
+The modern town-dweller is almost wholly in the hands of the private
+owners of the products upon which he depends. The ordinary city dweller
+spends two-fifths of his income for food; one-fifth for rent, fuel and
+light, and one-fifth for clothes. Food, houses, fuel (with the exception
+of gas supply in some cities), and clothing are privately owned. The
+public ownership of streets and water works, of some gas, electricity,
+street cars, and public markets, is a negligible factor in the problem.
+The private monopolist has the upper hand and he is able through the
+control of transportation, storage, and merchandising facilities, to
+make handsome profits for the "service" which he renders the consumer.
+
+
+7. _The Control of the Surplus_
+
+The wealth owners are doubly entrenched. They own the jobs upon which
+most families depend for a living. They own the necessaries of life
+which most families must purchase in order to live. Further, they
+control the surplus wealth of the community.
+
+There are three principal channels of surplus. First of all there is the
+surplus laid aside by business concerns, reinvested in the business,
+spent for new equipment and disposed of in other ways that add to the
+value of the property. Second, there are the 19,103 people in the United
+States with incomes of $50,000 or more per year; the 30,391 people with
+incomes of $25,000 to $50,000 per year and the 12,502 people with
+incomes of $10,000 to $25,000 per year. (Figures for 1917.) Many, if not
+most of these rich people, carry heavy insurance, invest in securities,
+or in some other way add to surplus. In the third place there are the
+small investors, savings-bank depositors, insurance policy holders who,
+from their income, have saved something and have laid it aside for the
+rainy day. The masters of economic life--bankers, insurance men,
+property holders, business directors--are in control of all three forms
+of surplus.
+
+The billions of surplus wealth that come each year under the control of
+the masters carry with them an immense authority over the affairs of the
+community. The owners of wealth owe much of their immediate power to
+the fact that they control this surplus, and are in a position to direct
+its flow into such channels as they may select.
+
+
+8. _The Channels of Public Opinion_
+
+No one can question the control which business interests exercise over
+the jobs, the industrial product, and the economic surplus of the
+community. These facts are universally admitted. But the corollaries
+which flow naturally from such axioms are not so readily accepted. Yet
+given the economic power of the business world, the control over the
+channels of public opinion and over the machinery of government follows
+as a matter of course.
+
+The channels of public opinion--the school, the press, the pulpit,--are
+not directly productive of tangible economic goods, yet they depend upon
+tangible economic goods for their maintenance. Whence should these goods
+come? Whence but from the system that produces them, through the men who
+control that system! The plutocracy exercises its power over the
+channels of public opinion in two ways,--the first, by a direct or
+business office control; and second, by an indirect or social prestige
+control.
+
+The business office control is direct and simple. Schools, colleges,
+newspapers, magazines and churches need money. They cannot produce
+tangible wealth directly, and they must, therefore, depend upon the
+surplus which arises from the productive activities of the economic
+world. Who controls that surplus? Business men. Who, then, is in a
+position to dictate terms in financial matters? Who but the dominant
+forces in business life?
+
+The facts are incontrovertible. It is not mere chance that recruits the
+overwhelming majority of school-board members, college trustees,
+newspaper managers, and church vestrymen, from the ranks of successful
+business and professional men. It is necessary for the educator, the
+journalist, and the minister to work through these men in order to
+secure the "sinews of war." They are at the focal points of power
+because they control the sources of surplus wealth.
+
+The second method of maintaining control--through the control of social
+prestige--is indirect, but none the less effective. The young man in
+college; the young graduate looking for a job; the young man rising in
+his profession, and the man gaining ascendancy in his chosen career are
+brought into constant contact with the "influential" members of the
+business world. It is the business world that dominates the clubs and
+the vacation spots; it is the business world that is met in church, at
+the dinner tables and at the social gathering.
+
+The man who would "succeed" must retain the favor of this group. He does
+so automatically, instinctively or semi-consciously--it is the common,
+accepted practice and he falls in line.
+
+The masters need not bribe. They need not resort to illegal or unethical
+methods. The ordinary channels of advertising, of business acquaintance
+and patronage, of philanthropy and of social intercourse clinch their
+power over the channels of public opinion.
+
+
+9. _The Control of Political Machinery_
+
+The American government,--city, state and nation--is in almost the same
+position as the schools, newspapers and churches. It does not turn out
+tangible, economic products. It depends, for its support, upon taxes
+which are levied, in the first instance, upon property. Who are the
+owners of this property? The business interests. Who, therefore, pay the
+bills of the government? The business interests.
+
+Nowhere has the issue been stated more clearly or more emphatically than
+by Woodrow Wilson in certain passages of his "New Freedom." As a student
+of politics and government--particularly the American Government--he
+sees the power which those who control economic life are able to
+exercise over public affairs, and realizes that their influence has
+grown, until it overtops that of the political world so completely that
+the machinery of politics is under the domination of the organizers and
+directors of industry.
+
+"We know," writes Mr. Wilson in "The New Freedom," "that something
+intervenes between the people of the United States and the control of
+their own affairs at Washington. It is not the people who have been
+ruling there of late" (p. 28). "The masters of the government of the
+United States are the combined capitalists and manufacturers of the
+United States.... Suppose you go to Washington and try to get at your
+government. You will always find that while you are politely listened
+to, the men really consulted are the men who have the biggest
+stakes--the big bankers, the big manufacturers, the big masters of
+commerce, the heads of railroad corporations and of steamship
+corporations.... Every time it has come to a critical question, these
+gentlemen have been yielded to and their demands have been treated as
+the demands that should be followed as a matter of course. The
+government of the United States at present is a foster-child of the
+special interests" (p. 57-58). "The organization of business has become
+more centralized, vastly more centralized, than the political
+organization of the country itself" (p. 187). "An invisible empire has
+been set up above the forms of democracy" (p. 35). "We are all caught in
+a great economic system which is heartless" (p. 10).
+
+This is the direct control exercised by the plutocracy over the
+machinery of government. Its indirect control is no less important, and
+is exercised in exactly the same way as in the case of the channels of
+public opinion.
+
+Lawyers receive preferment and fees from business--there is no other
+large source of support for lawyers. Judges are chosen from among these
+same lawyers. Usually they are lawyers who have won preferment and
+emolument. Legislators are lawyers and business men, or the
+representatives of lawyers and business men. The result is as logical as
+it is inevitable.
+
+The wealth owners control the machinery of government because they pay
+the taxes and provide the campaign funds. They control public officials
+because they have been, are, or hope to be, on the payrolls, or
+participants in the profits of industrial enterprises.
+
+
+10. _It is "Their United States"_
+
+The man fighting for bread has little time to "turn his eyes up to the
+eternal stars." The western cult of efficiency makes no allowances for
+philosophic propensities. Its object is product and it is satisfied with
+nothing short of that sordid goal.
+
+The members of the wealth owning class are relieved from the food
+struggle. Their ownership of the social machinery guarantees them a
+secure income from which they need make no appeal. These privileges
+provide for them and theirs the leisure and the culture that are the
+only possible excuse for the existence of civilization.
+
+The propertied class, because it owns the jobs, the industrial products,
+the social surplus, the channels of public opinion and the political
+machinery also enjoys the opportunity that goes with adequately assured
+income, leisure and culture.
+
+The members of the dominant economic class hold a key--property
+ownership--which opens the structure of social wealth. Those who have
+access to this key are the blessed ones. Theirs are the things of this
+world.
+
+The property owners enjoy the fleshpots. They hold the vantage points.
+The vital forces are in their hands. Economically, politically,
+socially, they are supreme.
+
+If the control of material things can make a group secure, the wealth
+owners in the United States are secure. They hold property, prestige,
+power.
+
+The phrase "our United States" as used by the great majority of the
+people is a misnomer. With the exception of a theoretically valuable but
+practically unimportant right called "freedom of contract," the majority
+of the wage earners in the United States have no more excuse for using
+the phrase "our United States" than the slaves in the South, before the
+war, for saying "our Southland."
+
+The franchise is a potential power, making it theoretically possible for
+the electorate to take possession of the country. In practice, the
+franchise has had no such result. Quite the contrary, the masters of
+American life by a policy of chicanery and misrepresentation, advertise
+and support first one and then the other of the "Old Parties," both of
+which are led by the members of the propertied class or by their
+retainers. The people, deluded by the press, and ignorant of their real
+interests, go to the polls year after year and vote for representatives
+that represent, in all of their interests, the special privileged
+classes.
+
+The economic and social reorganization of the United States during the
+past fifty years has gone fast and far. The system of perpetual (fee
+simple) private ownership of the resources has concentrated the control
+over the natural resources in a small group, not of individuals,
+but of corporations; has created a new form of social master, in
+the form of a land-tool-job owner; has thus made possible a type of
+absentee-landlordism more effective and less human than were any of its
+predecessors and has decreased the responsibility at the same time that
+it has augmented the power of the owning group. These changes have been
+an integral part of a general economic transformation that has occupied
+the chief energies of the ablest men of the community for the past two
+generations.
+
+The country of many farms, villages and towns, and of a few cities, with
+opportunity free and easy of access, has become a country of highly
+organized concentrated wealth power, owned by a small fraction of the
+people and controlled by a tiny minority of the owners for their benefit
+and profit. The country which was rightfully called "our United States"
+in 1840, by 1920 was "their United States" in every important sense of
+the word.
+
+FOOTNOTES:
+
+[39] "Estimated Valuation of National Wealth, 1850-1912," Bureau of the
+Census, 1915, p. 15.
+
+[40] "Addresses of President Wilson," House Doc. 803. Sixty-fourth
+Congress, 1st Session (1916), p. 13.
+
+
+
+
+IX. THE DIVINE RIGHT OF PROPERTY
+
+
+1. _Land Ownership and Liberty_
+
+The owners of American wealth have been molded gradually into a ruling
+class. Years of brutal, competitive, economic struggle solidified their
+ranks,--distinguishing friend from enemy; clarifying economic laws, and
+demonstrating the importance of coördination in economic affairs.
+Economic control, once firmly established, opened before the wealth
+owning class an opportunity to dominate the entire field of public life.
+
+Before the property owners could feel secure in their possessions, steps
+must be taken to transmute the popular ideas regarding "property rights"
+into a public opinion that would permit the concentration of important
+property in the hands of a small owning class, at the same time that it
+held to the conviction that society, without privately owned land and
+machinery, was unthinkable.
+
+Many of the leading spirits among the colonists had come to America in
+the hope of realizing the ideal of "Every man a farm, and every farm a
+man." Upon this principle they believed that it would be possible to set
+up the free government which so many were seeking in those dark days of
+the divine right of kings.
+
+For many years after the organization of the Federal Government men
+spoke of the public domain as if it were to last indefinitely. As late
+as 1832 Henry Clay, in a discussion of the public lands, could say, "We
+should rejoice that this bountiful resource possessed by our country,
+remains in almost undiminished quantity." Later in the same speech he
+referred to the public lands as being "liberally offered,--in
+exhaustless quantities, and at moderate prices, enriching individuals
+and tending to the rapid improvement of the country."[41]
+
+The land rose in price as settlers came in greater numbers. Land booms
+developed. Speculation was rife. Efforts were made to secure additional
+concessions from the Government. It was in this debate, where the public
+land was referred to as "refuse land" that Henry Clay felt called upon
+to remind his fellow-legislators of the significance and growing value
+of the public land. He said, "A friend of mine in this city bought in
+Illinois last fall about two thousand acres of this refuse land at the
+minimum price, for which he has lately refused six dollars per acre....
+It is a business, a very profitable business, at which fortunes are made
+in the new states, to purchase these refuse lands and without improving
+them to sell them at large advances."[42]
+
+A century ago, while it was still almost a wilderness, Illinois began to
+feel the pressure of limited resources--a pressure which has increased
+to such a point that it has completely revolutionized the system of
+society that was known to the men who established the Government of the
+United States.
+
+This early record of a mid-western land boom, with Illinois land at six
+dollars an acre, tells the story of everything that was to follow. Even
+in 1832 there was not enough of the good land to go around. Already the
+community was dividing itself into two classes--those who could get good
+land and those who could not. A wise man, understanding the part played
+by economic forces in determining the fate of a people, might have said
+to Henry Clay on that June day in 1832, "Friend, you have pronounced the
+obituary of American liberty."
+
+Some wise man might have spoken thus, but how strange the utterance
+would have sounded! There was so much land, and all history seemed to
+guarantee the beneficial results that are derived from individual land
+ownership. The democracies of Greece and Rome were built upon such a
+foundation. The yeomanry of England had proved her pride and stay. In
+Europe the free workers in the towns had been the guardians of the
+rights of the people. Throughout historic times, liberty has taken root
+where there is an economic foundation for the freedom which each man
+feels he has a right to demand.
+
+
+2. _Security of "Acquisitions"_
+
+Feudal Europe depended for its living upon agriculture. The Feudal
+System had concentrated the ownership of practically all of the valuable
+agricultural land in the hands of the small group of persons which ruled
+because it controlled economic opportunity. The power of this class
+rested on its ownership of the resource upon which the majority of the
+people depended for a livelihood.
+
+The Feudal System was transplanted to England, but it never took deep
+root there. When in 1215 A. D. (only a century and a half after the
+Great William had made his effort to feudalize England) King John signed
+the Magna Carta, Feudalism proper gave way to landlordism--the basis of
+English economic life from that time to this.
+
+The system of English landlordism (which showed itself at its worst in
+the absentee landlordism of Ireland) differed from Feudalism in this
+essential respect,--Feudalism was based upon the idea of the divine
+right of kings. English landlordism was based on the idea of divine
+right of property. English landlordism is the immediate ancestor of the
+property concept that is universally accepted in the business world of
+to-day.
+
+The evils of Feudalism and of landlordism were well known to the
+American colonists who were under the impression that they arose not
+from the fact of ownership, but from the concentration of ownership. The
+resources of the new world seemed limitless, and the possibility that
+landlordism might show its ugly head on this side of the Atlantic was
+too remote for serious consideration.
+
+With the independence of the United States assured after the War of
+1812; with the growth of industry, and the coming of tens of thousands
+of new settlers, the future of democracy seemed bright. Daniel Webster
+characterized the outlook in 1821 by saying, "A country of such vast
+extent, with such varieties of soil and climate, with so much public
+spirit and private enterprise, with a population increasing so much
+beyond former examples, ... so free in its institutions, so mild in its
+laws, so secure in the title it confers on every man to his own
+acquisitions,--needs nothing but time and peace to carry it forward to
+almost any point of advancement."[43]
+
+"So free in its institutions, so mild in its laws, so secure in the
+title it confers on every man to his own acquisitions,"--the words were
+prophetic. At the moment when they were uttered the forces were busy
+that were destined to realize Webster's dream, on an imperial scale, at
+the expense of the freedom which he prized. Men were free to get what
+they could, and once having secured it, they were safeguarded in its
+possession. Property ownership was a virtue universally commended.
+Constitutions were drawn and laws were framed to guarantee to property
+owners the rights to their property, even in cases where this property
+consisted of the bodies of their fellow men.
+
+The movement toward the protection of property rights has been
+progressive. Webster as a representative of the dominant interests of
+the country a hundred years ago rejoiced that every man had a secure
+title to "his own acquisitions," at a time when the property of the
+country was generally owned by those who had expended some personal
+effort in acquiring it. It was a long step from these personal
+acquisitions to the tens of billions of wealth in the hands of
+twentieth century American corporations. Daniel Webster helped to bridge
+the gap. He was responsible, at least in part, for the Dartmouth College
+Decision (1816) in which the Supreme Court ruled that a charter, granted
+by a state, is a contract that cannot be modified at will by the state.
+This decision made the corporation, once created and chartered, a free
+agent. Then came the Fourteenth Amendment with its provision that "no
+state shall make or enforce any law which shall abridge the privileges
+or immunities of citizens of the United States; nor shall any state
+deprive any person of life, liberty or property, without due process of
+law." The amendment was intended to benefit negroes. It has been used to
+place property ownership first among the American beatitudes.
+
+Corporations are "persons" in the eyes of the law. When the state of
+California tried to tax the property of the Southern Pacific Railroad at
+a rate different from that which it imposed on persons, the Supreme
+Court declared the law unconstitutional. This decision, coupled with
+that in the Dartmouth College Case secured for a corporation "the same
+immunities as any other person; and since the charter creating a
+corporation is a contract, whose obligation cannot be impaired by the
+one-sided act of a legislature, its constitutional position, as property
+holder, is much stronger than anywhere in Europe." These decisions "have
+had the effect of placing the modern industrial corporation in an almost
+impregnable constitutional position."[44]
+
+Surrounded by constitutional guarantees, armed with legal privileges and
+prerogatives and employing the language of liberty, the private property
+interests in the United States have gone forward from victory to
+victory, extending their power as they increased and concentrated their
+possessions.
+
+
+3. _Safeguarding Property Rights_
+
+The efforts of Daniel Webster and his contemporaries to protect
+"acquisitions" have been seconded, with extraordinary ability, by
+business organizers, accountants, lawyers and bankers, who have
+broadened the field of their endeavors until it includes not merely
+"acquisitions," but all "property rights." Daniel Webster lived before
+the era of corporations. He thought of "acquisitions" as property
+secured through the personal efforts of the human being who possessed
+it. To-day more than half of the total property and probably more than
+three-quarters of productive wealth is owned by corporations. It
+required ability and foresight to extend the right of "acquisitions" to
+the rights of corporate stocks and bonds. The leaders among the property
+owners possessed the necessary qualifications. They did their work
+masterfully, and to-day corporate property rights are more securely
+protected than were the rights of acquisitions a hundred years ago.
+
+The safeguards that have been thrown about property are simple and
+effective. They arose quite naturally out of the rapidly developing
+structure of industrialism.
+
+_First_--There was an immense increase in the amount of property and of
+surplus in the hands of the wealth-owning class. After the new industry
+was brought into being with the Industrial Revolution, economic life no
+longer depended so exclusively upon agricultural land. Coal, iron,
+copper, cement, and many other resources could now be utilized, making
+possible a wider field for property rights. Again, the amount of surplus
+that could be produced by one worker, with the assistance of a machine,
+was much greater than under the agricultural system.
+
+_Second_--The new method of conducting economic affairs gave the
+property owners greater security of possession. Property holders always
+have been fearful that some fate might overtake their property, forcing
+them into the ranks of the non-possessors. When property was in the form
+of bullion or jewels, the danger of loss was comparatively great. The
+Feudal aristocracy, with its land-holdings, was more secure.
+Land-holdings were also more satisfactory. Jewels and plate do not pay
+any rent, but tenants do. Thus the owner of land had security plus a
+regular income.
+
+The corporation facilitated possession by providing a means (stocks and
+bonds) whereby the property owner was under no obligation other than
+that of clipping coupons or cashing interest checks upon "securities"
+that are matters of public record; issued by corporations that make
+detailed financial reports, and that are subject to vigorous public
+inspection and, in the cases of banks and other financial organizations,
+to the most stringent regulation.
+
+_Third_--Greater permanence has been secured for property advantages.
+Corporations have perpetual, uninterrupted life. The deaths of persons
+do not affect them. The corporation also overcame the danger of the
+dissipation of property in the process of "three generations from shirt
+sleeves to shirt sleeves." The worthless son of the thrifty parent may
+still be able to squander his inheritance, but that simply means a
+transfer of the title to his stocks and bonds. The property itself
+remains intact.
+
+_Fourth_--Property has secured a claim on income that is, in the last
+analysis, prior to the claim of the worker.
+
+When a man ran his own business, investing his capital, putting back
+part of his earnings, and taking from the business only what he needed
+for his personal expenses, "profits" were a matter of good fortune.
+There were "good years" and "bad years," when profits were high or low.
+Many years closed with no profit at all. The average farmer still
+handles his business in that way.
+
+The incorporation of business, and the issuing of bonds and stocks has
+revolutionized this situation. It is no longer possible to "wait till
+things pick up." If the business has issued a million in bonds, at five
+per cent, there is an interest charge of $50,000 that must be met each
+year. There may be no money to lay out for repairs and needed
+improvements, but if the business is to remain solvent, it must pay the
+interest on its bonds.
+
+Businesses that are issuing securities to the public face the same
+situation with regard to their stocks. Wise directors see to it that a
+regular rate, rather than a high rate of dividends, is paid. Regularity
+means greater certainty and stability, hence better consideration from
+the investing public.
+
+_Fifth_--The practices of the modern economic world have gone far to
+increase the security of property rights.
+
+Business men have worked ardently to "stabilize" business. They have
+insisted upon the importance of "business sanity;" of conservatism in
+finance; of the returns due a man who risks his wealth in a business
+venture; and of the fundamental necessity of maintaining business on a
+sound basis. After centuries of experiment they have evolved what they
+regard as a safe and sane method of financial business procedure. Every
+successful business man tried to live up to the following
+well-established formula.
+
+First, he pays out of his total returns, or gross receipts, the ordinary
+costs of doing business--materials, labor, repairs and the like. These
+payments are known as running expenses or up-keep.
+
+Second, after up-keep charges are paid he takes the remainder, called
+gross income, and pays out of it the fixed charges--taxes, insurance,
+interest and depreciation.
+
+Third, the business man, having paid all of the necessary expenses of
+doing business (the running expenses and the fixed charges), has left a
+fund (net income) which, roughly speaking, is the profits of the
+business. Out of this net income, dividends are paid, improvements and
+extensions of the plant are provided for.
+
+Fourth, the careful business man increases the stability of his
+business by adding something to his surplus or undivided profits.
+
+The operating statistics of the United Steel Corporation for 1918
+illustrate the principle:
+
+
+     1. Gross Receipts                         $1,744,312,163
+       Manufacturing and Operating expenses
+       including ordinary repairs               1,178,032,665
+                                              ---------------
+     2. Gross Earnings                         $  566,279,498
+       Other income                                40,474,823
+                                              ---------------
+                                               $  606,754,321
+
+       General Expense, (including commission
+       and selling expense, taxes, etc.)          337,077,986
+       Interest, depreciation, sinking fund, etc. 144,358,958
+                                               --------------
+     3. Net Income                             $  125,317,377
+       Dividends                                   96,382,027
+                                               --------------
+     4. Surplus for the year                   $   28,935,350
+       Total surplus                              460,596,154
+
+
+Like every carefully handled business, the Steel Corporation,--
+
+
+     1. Paid its running expenses,
+     2. Paid its fixed obligations,
+     3. Divided up its profits,
+     4. And kept a nest egg.
+
+
+The effectiveness of such means of stabilizing property income is
+illustrated by a compilation (published in the _Wall Street Journal_ for
+August 7th, 1919) of the business of 104 American corporations between
+December 31, 1914, and December 31, 1918. The inventories--value of
+property owned--had increased from 1,192 millions to 2,624 millions of
+dollars; the gain in surplus, during the four years, was 1,941
+millions; the increase in "working capital" was 1,876 millions. These
+corporations, representing only a small fraction of the total business
+of the country, had added billions to their property values during the
+four years.
+
+These various items,--up-keep; depreciation; insurance; taxes; interest;
+dividends and surplus,--are recognized universally by legislatures and
+courts as "legitimate" outlays. They, therefore, are elements that are
+always present in the computation of a "fair" price. The cost to the
+consumer of coffee, shoes, meat, blankets, coal and transportation are
+all figured on such a basis. Hence, it will be seen that each time the
+consumer buys a pair of shoes or a pound of meat, he is paying, with
+part of his money, for the stabilizing of property.
+
+Fifth. Property titles under this system are rendered immortal. A
+thousand dollars, invested in 1880 in 5 per cent. 40 year bonds, will
+pay to the owner $2,000 in interest by 1920, at which time the owner
+gets his original thousand back again to be re-invested so long as he
+and his descendants care to do so. The dollar, invested in the business
+of the steel corporation, by the technical processes of bookkeeping, is
+constantly renewed. Not only does it pay a return to the owner, but
+literally, it never dies.
+
+The community is built upon labor. Its processes are continued and its
+wealth is re-created by labor. The men who work on the railroad keep the
+road operating; those who own the railroad owe to it no personal fealty,
+and perform upon it no personal service. If the worker dies, the train
+must stop until he is replaced; if the owner dies, the clerk records a
+change of name in the registry books.
+
+The well-ordered society will encourage work. It will aim to develop
+enthusiasm, to stimulate activity. Nevertheless, in "practical America"
+a scheme of economic organization is being perfected under which the
+cream of life goes to the owners. They have the amplest opportunities.
+They enjoy the first fruits.
+
+
+4. _Property Rights and Civilization_
+
+Under these circumstances, it is easy to see how "the rights of
+property" soon comes to mean the same thing as "civilization," and how
+"the preservation of law and order" is always interpreted as the
+protection of property. With a community organized on a basis which
+renders property rights supreme in all essential particulars, it is but
+natural that the perpetuation of these rights should be regarded as the
+perpetuation of civilization itself.
+
+The present organization of economic life in the United States permits
+the wealth owners through their ownership to live without doing any work
+upon the work done by their fellows. As recipients of property income
+(rent, interest and dividends) they have a return for which they need
+perform no service,--a return that allows them to "live on their
+income."
+
+The man who fails to assist in productive activity gives nothing of
+himself in return for the food, clothing and shelter which he
+enjoys,--that is, he lives on the labor of others. Where some have sowed
+and reaped, hammered and drilled, he has regaled himself on the fruits
+of their toil, while never toiling himself.
+
+The matter appears most clearly in the case of an heir to an estate. The
+father dies, leaving his son the title deeds to a piece of city land. If
+he has no confidence in his son's business ability or if his son is a
+minor, he may leave the land in trust, and have it administered in his
+son's interest by some well organized trust company. The father did not
+make the land, though he did buy it. The son neither made nor bought the
+land, it merely came to him; and yet each year he receives a
+rent-payment upon which he is able to live comfortably without doing any
+work. It must at once be apparent that this son of his father,
+economically speaking, performs no function in the community, but merely
+takes from the community an annual toll or rental based on his ownership
+of a part of the land upon, which his fellowmen depend for a living. Of
+what will this toll consist? Of bread, shoes, motor-cars, cigars, books
+and pictures,--the products of the labor of other men.
+
+This son of his father is living on his income,--supported by the labor
+of other people. He performs no labor himself, and yet he is able to
+exist comfortably in a world where all of the things which are consumed
+are the direct or indirect product of the labor of some human being.
+
+Living on one's income is not a new social experience, but it is
+relatively new in the United States. The practice found a reasonably
+effective expression in the feudalism of medieval Europe. It has been
+brought to extraordinary perfection under the industrialism of Twentieth
+Century America.
+
+Imagine the feelings of the early inhabitants of the American colonies
+toward those few gentlemen who set themselves up as economically
+superior beings, and who insisted upon living without any labor, upon
+the labor performed by their fellows. It was against the suggestion of
+such a practice that Captain John Smith vociferated his famous "He that
+will not work, neither shall he eat." The suggestion that some should
+share in the proceeds of community life without participating in the
+hardships that were involved in making a living seemed preposterous in
+those early days.
+
+To-day, living on one's income is accepted in every industrial center of
+the United States as one of the methods of gaining a livelihood. Some
+men and women work for a living. Other men and women own for a living.
+
+Workers are in most cases the humble people of the community. They do
+not live in the finest homes, eat the best food, wear the most elaborate
+clothing, or read, travel and enjoy the most of life.
+
+The owners as a rule are the well-to-do part of the community. They
+derive much of all of their income from investments. The return which
+they make to the community in services is small when compared with the
+income which they receive from their property holdings.
+
+Living on one's income is becoming as much a part of American economic
+life as living by factory labor, or by mining, or by manufacturing, or
+by any other occupation upon which the community depends for its
+products. The difference between these occupations and living on one's
+income is that they are relatively menial, and it is relatively
+respectable, that is, they have won the disapprobation and it has won
+the approbation of American public opinion.
+
+The best general picture of the economic situation that permits a few
+people to live on their incomes, while the masses of the people work for
+a living, is contained in the reports of the Federal Commissioner of
+Internal Revenue. The figures for 1917 ("Statistics of Income for 1917"
+published August 1919) show that 3,472,890 persons filed returns, making
+one for each six families in the United States. Almost one half of the
+total number of returns made in 1917 were from persons whose income was
+between $1000 and $2000. There were 1,832,132 returns showing incomes of
+$2000 or more, one for each twelve families in the country.
+
+The number of persons receiving the higher incomes is comparatively
+small. There were 270,666 incomes between $5,000 and $10,000; 30,391
+between $10,000 and $25,000; 12,439 between $25,000 and $50,000. There
+were 432,662 returns (22 for each 1000 families in the United States)
+showing incomes of $5,000 or over; there were 161,996 returns (8 returns
+for each 1000 families) showing incomes of $10,000 or over; 49,494
+showing incomes of $25,000 and over; 19,103 showing incomes of $50,000
+and more. Thus the number of moderate and large incomes, compared with
+the total population of the country, was minute.
+
+The portion of the report that is of particular interest, in so far as
+the present study is concerned, is that which presents a division of the
+total net income of those reporting $2,000 or more, into three
+classes--income from personal service, income from business profits and
+income from the ownership of property.
+
+
+                 PERSONAL INCOMES BY SOURCES--1917
+
+                                      _Amount of_    _Per Cent_
+                                      _Income_       _of Total_
+               _Source_                               _Income_
+     1. Income from personal service;
+     salaries, wages; commission,
+     bonuses, director's
+     fees, etc                         $ 3,648,437,902   30.21
+
+     2. Income from business; business,
+     trade, commerce,
+     partnership, farming, and
+     profits from sales of real
+     estate, stocks, bonds, and
+     other property                      3,958,670,028   32.77
+
+     3. Income from property; rents
+     and royalties                         684,343,399    5.67
+     Interest on bonds, notes, etc.        936,715,456    7.76
+     Dividends                           2,848,842,499   23.59
+     Total from Property                 4,469,901,354   37.02
+
+     4. Total income                    12,077,009,284  100.00
+
+
+Those persons who have incomes of $2,000 or more receive 30 cents on the
+dollar in the form of wages and salaries; 33 cents in the form of
+business profits, and 37 cents in the form of incomes from the ownership
+of property. The dividend payments alone--to this group of property
+owners, are equal to three quarters of the total returns for personal
+service.
+
+These figures refer, of course, to all those in receipt of $2,000 or
+more per year. Obviously, the smaller incomes are in the form of wages,
+salaries, and business profits, while the larger incomes take the form
+of rent, interest and dividends. This is made apparent by a study of the
+detailed tables published in connection with the "Income Statistics for
+1916."
+
+Among those of small incomes--$5,000 to $10,000--nearly half of the
+income was derived from personal services. The proportion of the income
+resulting from personal service diminished steadily as the incomes rose
+until, in the highest income group--those receiving $2,000,000 or more
+per year, less than one-half of one per cent. was the result of personal
+service while more than 99 per cent. of the incomes came from property
+ownership.
+
+A small portion of the American people are in receipt of incomes that
+necessitate a report to the revenue officers. Among those persons, a
+small number are in receipt of incomes that might be termed
+large--incomes of $10,000 or over, for example. Among these persons with
+large incomes the majority of the income is secured in the form of rent,
+interest, dividends and profits. The higher the income group, the larger
+is the percentage of the income that comes from property holdings.
+
+The economic system that exists at the present time in the United States
+places a premium on property ownership. The recipients of the large
+incomes are the holders of the large amounts of property.
+
+Large incomes are property incomes. The rich are rich because they are
+property owners. Furthermore, the organization of present-day business
+makes the owner of property more secure--far more secure in his income,
+than is the worker who produces the wealth out of which the property
+income is paid.
+
+
+5. _Plutocracy_
+
+The owning class in the United States is established on an economic
+basis,--the private ownership of the earth. No more solid foundation for
+class integrity and class power has ever been discovered.
+
+The owners of the United States are powerfully entrenched. Operating
+through the corporation, its members have secured possession of the bulk
+of the more useful resources, the important franchises and the
+productive capital. Where they do not own outright, they control. The
+earth, in America, is the landlords and the fullness thereof. They own
+the productive machinery, and because they own they are able to secure a
+vast annual income in return for their bare ownership.
+
+Families which enjoy property income have one great common
+interest--that of perpetuating and continuing the property income; hence
+the "cohesion of wealth." "The cohesion of wealth" is a force that welds
+individuals and families who receive property income into a unified
+group or class.
+
+The cohesion of wealth is a force of peculiar social significance. It
+might perhaps be referred to as the class consciousness of the wealthy
+except that it manifests itself among people who have recently acquired
+wealth, more violently, in some cases, than it appears among those whose
+families have possessed wealth for generations. Then, the cohesion of
+wealth is not always an intelligent force. In the case of some persons
+it is largely instinctive.
+
+Originally, the cohesion of wealth expresses itself instinctively among
+a group of wealth owners. They may be competing fiercely as in the case
+of a group of local banks, department stores, or landlords, but let a
+common enemy appear, with a proposition for currency reform, labor
+legislation or land taxation and in a twinkling the conflicting
+interests are thrown to the winds and the property owners are welded
+into a coherent, unified group. This is the beginning of a wealth
+cohesion which develops rapidly into a wealth consciousness.
+
+American business, a generation ago, was highly competitive. Each
+business man's hand was raised against his neighbor and the downfall of
+one was a matter of rejoicing for all. The bitter experience of the
+nineties drove home some lessons; the struggles with labor brought some
+more; the efforts at government regulations had their effect; but most
+of all, the experience of meeting with men in various lines of business
+and discussing the common problems through the city, state and national
+and business organizations led to a realization of the fact that those
+who owned and managed business had more in common than they had in
+antagonism. By knifing one another they made themselves an easy prey for
+the unions and the government. By pooling ideas and interests they
+presented a solid front to the demands of organized labor and the
+efforts of the public to enforce regulation.
+
+"Plutocracy" means control by those who own wealth. The "plutocratic
+class" consists of that group of persons who control community affairs
+because they own property. This class, because of its property
+ownership, is compelled to devote time and infinite pains to the task of
+safeguarding the sacred rights of property. It is to that task that the
+leaders of the American plutocracy have committed themselves, and it is
+from the results of that accomplished work that they are turning to new
+labors.
+
+FOOTNOTES:
+
+[41] Speech in the Senate, June 20, 1832. Works Colvin Colton, ed. New
+York, Putnam's, 1904, vol. 7, p. 503.
+
+[42] Ibid., p. 503.
+
+[43] "Speeches," E. P. Whipple, ed. Little, Brown & Co., 1910, pp.
+59-60.
+
+[44] "The Constitutional Position of Property in America," Arthur T.
+Hadley, _Independent_, April 16, 1908.
+
+
+
+
+X. INDUSTRIAL EMPIRES
+
+
+1. _They Cannot Pause!_
+
+The foundations of Empire have been laid in the United States. Territory
+has been conquered; peoples have been subjugated or annihilated; an
+imperial class has established itself. Here are all of the essential
+characteristics of empire.
+
+The American people have been busy laying the political foundations of
+Empire for three centuries. A great domain, taken by force of arms from
+the people who were in possession of it has been either incorporated
+into the Union, or else held as dependent territory. The aborigines have
+disappeared as a race. The Negroes, kidnaped from their native land,
+enslaved and later liberated, are still treated as an inferior people
+who should be the hewers of wood and the drawers of water. A vast
+territory was taken from Mexico as a result of one war. A quarter
+million square miles were secured from Spain in another; on the
+Continent three and a half millions of square miles; in territorial
+possessions nearly a quarter of a million more--this is the result of
+little more than two hundred years of struggle; this is the geographic
+basis for the American Empire.
+
+The structure of owning class power is practically complete in the
+United States. Through long years the business interests have evolved a
+form of organization that concentrates the essential power over the
+industrial and financial processes in a very few hands,--the hands of
+the investment bankers. During this contest for power the plutocracy
+learned the value of the control of public opinion, and brought the
+whole machinery for the direction of public affairs under its
+domination. Thus political and social institutions as well as the
+processes of economic life were made subject to plutocratic authority.
+A hundred years has sufficed to promulgate ideas of the sacredness of
+private property that place its preservation and protection among the
+chief duties of man. Economic organization; the control of all important
+branches of public affairs, and the elevation of property rights to a
+place among the beatitudes--by these three means was the authority of
+the plutocracy established and safeguarded.
+
+Since economic political and social power cover the field of authority
+that one human being may exercise over another, it might be supposed
+that the members of the plutocratic class would pause at this point and
+cease their efforts to increase power. But the owners cannot pause! A
+force greater than their wills compels them to go on at an ever growing
+speed. Within the vitals of the economic system upon which it subsists
+the plutocracy has found a source of never-ending torment in the form of
+a constantly increasing surplus.
+
+
+2. _The Knotty Problem of Surplus_
+
+The present system of industry is so organized that the worker is always
+paid less in wages than he creates in product. A part of this difference
+between product and wages goes to the upkeep and expansion of the
+industry in which the worker is employed. Another part in the form of
+interest, dividends, rents, royalties and profits, goes to the owners of
+the land and productive machinery.
+
+The values produced in industry and handed to the industrial worker or
+property owner in the form of income, may be used or "spent" either for
+"consumption goods"--things that are to be used in satisfying human
+wants, such as street car transportation, clothing, school books, and
+smoking tobacco; or for production goods--things that are to be used in
+the making of wealth, such as factory buildings, lathes, harvesting
+machinery, railroad equipment. Those who have small incomes necessarily
+spend the greater part for the consumption of goods upon which their
+existence depends. On the other hand, those who are in receipt of large
+incomes cannot use more than a limited amount of consumption goods.
+Therefore, they are in a position to turn part of their surplus into
+production goods. As a reward for this "saving" the system gives them
+title to an amount of wealth equal to the amount saved, and in addition,
+it grants an amount of "interest" so that the next year the recipient of
+surplus gets the regular share of surplus, and beside that an additional
+reward in the form of interest. His share of the surplus is thus
+increased. That is, surplus breeds surplus.
+
+The workers are, for the most part, spenders. The great bulk of their
+income is turned at once into consumption goods. The owners in many
+instances are capitalists who hold property for the purpose of turning
+the income derived from it into additional investments.
+
+Could the worker buy back dollar for dollar the values which he produces
+there would be no surplus in the form of rent, interest, dividends and
+profits. The present economic system is, however, built upon the
+principle that those who own the lands and the productive machinery
+should be recompensed for their mere ownership. It follows, of course,
+that the more land and machinery there is to own the greater will be the
+amount of surplus which will go to the owners. Since surplus breeds
+surplus the owners find that it pays them not to use all of their income
+in the form of consumption, but rather to invest all that they can,
+thereby increasing the share of surplus that is due them. The worker, on
+the other hand, finds that he must produce a constantly larger amount of
+wealth which he never gets, but which is destined for the payment of
+rent, interest, dividends and profits. Increased incomes yield increased
+investments. Increased investments necessitate the creation and payment
+of increased surplus. The payment of increased surplus means increased
+incomes. Thus the circle is continued--with the returns heaping up in
+the coffers of the plutocracy.
+
+Originally the surplus was utilized to free the members of the owning
+class from the grinding drudgery of daily toil, by permitting them to
+enjoy the fruits of the labor of others. Then it was employed in the
+exercise of power over the economic and social machinery. But that was
+not the end--instead it proved only the beginning. As property titles
+were concentrated in fewer and fewer hands, and the amount of property
+owned by single individuals or groups of individuals becomes greater,
+their incomes (chiefly in the form of rent, interest, dividends and
+profits) rose until by 1917 there were 19,103 persons in the United
+States who declared incomes of $50,000 or more per year, which is the
+equivalent of $1,000 per week. Among these persons 141 declared annual
+incomes of over $1,000,000. Besides these personal incomes, each
+industry which paid these dividends and profits, through its
+depreciation, amortization, replacement, new construction, and surplus
+funds was reinvesting in the industries billions of wealth that would be
+used in the creation of more wealth. The normal processes of the growth
+of the modern economic system has forced upon the masters of life the
+problem of disposing of an ever increasing amount of surplus.
+
+During prosperous periods, the investment funds of a community like
+England and the United States grow very rapidly. The more prosperous the
+nation, the greater is the demand from those who cannot spend their huge
+incomes for safe, paying investment opportunities.
+
+The immense productivity of the present-day system of industry has added
+greatly to the amount of surplus seeking investment. Each invention,
+each labor saving device, each substitution of mechanical power that
+multiplies the productive capacity of industry at the same time
+increases the surplus at the disposal of the plutocracy.
+
+The surplus must be disposed of. There is no other alternative. If hats,
+flour and gasoline are piled up in the warehouses or stored in tanks, no
+more of these commodities will be made until this surplus has been used.
+The whole economic system proceeds on the principle that for each
+commodity produced, a purchaser must be found before another unit of the
+commodity is ordered. Demand for commodities stimulates and regulates
+the machinery of production.
+
+Those in control of the modern economic system have no choice but to
+produce surplus, and once having produced it, they have no choice except
+to dispose of it. An inexorable fate drives them onward--augmenting
+their burdens as it multiplies their labors.
+
+Investment opportunities, of necessity, are eagerly sought by the
+plutocracy, since the law of their system is "Invest or perish"!
+
+Invest? Where? Where there is some demand for surplus capital--that is
+in "undeveloped countries."
+
+The necessity for disposing of surplus has imposed upon the business men
+of the world a classification of all countries as "developed" or
+"undeveloped." "Developed" countries are those in which the capitalist
+processes have gone far enough to produce a surplus that is sufficient
+to provide for the upkeep and for the normal expansion of industry. In
+"developed" countries mines are opened, factories are built, railroads
+are financed, as rapidly as needed, out of the domestic industrial
+surplus. "Undeveloped" countries are those which cannot produce
+sufficient capital for their own needs, and which must, therefore,
+depend for industrial expansion upon investments of capital from the
+countries that do produce a surplus.
+
+"Developed" countries are those in which the modern industrial system
+has been thoroughly established.
+
+The contrast between developed and undeveloped countries is made clear
+by an examination of the investments of any investing nation, such as
+Great Britain. Great Britain in 1913 was surrounded by rich, prosperous
+neighbors--France, Germany, Holland, Belgium. Each year about a billion
+dollars in English capital was invested outside of the British Isles.
+Where did this wealth go? The chief objectives of British investment,
+aside from the British Dominions and the United States, were (stated in
+millions of pounds) Argentine 320; Brazil 148; Mexico 99; Russia 67;
+France 8 and Germany 6. The wealth of Germany or France is greater than
+that of Argentine, Brazil and Mexico combined, but Germany and France
+were developed countries, producing enough surplus for their own needs,
+and, therefore, the investable wealth of Great Britain went, not to her
+rich neighbors, but to the poorer lands across the sea.
+
+Each nation that produces an investable surplus--and in the nature of
+the present economic system, every capitalist nation must some day reach
+the point where it can no longer absorb its own surplus wealth--must
+find some undeveloped country in which to invest its surplus. Otherwise
+the continuity of the capitalist world is unthinkable. Great Britain,
+Belgium, Holland, France, Germany and Japan all had reached this stage
+before the war. The United States was approaching it rapidly.
+
+
+3. _"Undeveloped Countries"_
+
+Capitalism is so new that the active struggle to secure investment
+opportunities in undeveloped countries is of the most recent origin. The
+voyages which resulted in the discovery, by modern Europeans, of the
+Americas, Australia, Japan, and an easy road to the Orient, were all
+made within 500 years. The actual processes of capitalism are products
+of the past 150 years in England, where they had their origin. In
+France, Germany, Italy and Japan they have existed for less than a
+century. The great burst of economic activity which has pushed the
+United States so rapidly to the fore as a producer of surplus wealth
+dates from the Civil War. Only in the last generation did there arise
+the financial imperialism that results from the necessity of finding a
+market for investable surplus.
+
+The struggle for world trade had been waged for centuries before the
+advent of capitalism, but the struggle for investment opportunities in
+undeveloped countries is strictly modern. The matter is strikingly
+stated by Amos Pinchot in his "Peace or Armed Peace" (Nov. 11, 1918).
+
+"If you will look at the maps following page 554 of Hazen's 'Europe
+since 1815,' or any other standard colored map showing Africa and Asia
+in 1884, you will see that, but for a few rare spots of coloration, the
+whole continent of Africa is pure white. Crossing the Red Sea into
+Arabia, Persia, Mesopotamia and Asia Minor, you will find the same or
+rather a more complete lack of color. This is merely the cartographer's
+way of showing, by tint and lack of tint, that at that time Africa and
+Western Asia were still in the hands of their native populations.
+
+"Let us now turn to the same maps thirty years later, i.e., in 1914. We
+find them utterly changed. They are no longer white, but a patch work of
+variegated hues....
+
+"From 1870 to 1900, Great Britain added to her possessions, to say
+nothing of her spheres of influence, nearly 5,000,000 square miles with
+an estimated population of 88,000,000. Within a few years after
+England's permanent occupation of Egypt, which was the signal for the
+renaissance of French colonialism, France increased hers by 3,500,000
+square miles with a population of 37,000,000, not counting Morocco added
+in 1911. Germany, whose colonialism came later, because home and nearby
+markets longer absorbed the product of her machines, brought under her
+dominion from 1884 to 1899 1,000,000 square miles with an estimated
+population of 14,000,000."
+
+This is a picture of the political effects that followed the economic
+causes summed up in the term "financial imperialism."
+
+In the seventeenth and eighteenth centuries it was the trader, dealing
+in raw stuff; in the nineteenth century it was the manufacturer,
+producing at low cost to cut under his neighbor's price. During the past
+thirty years the investment banker has occupied the foreground with his
+efforts to find safe, paying opportunities for the disposal of the
+surplus committed to his care. British bankers, French bankers, German
+bankers, Belgian bankers, Dutch bankers--all intent upon the same
+mission--because behind all, and relentlessly driving, were the
+accumulating surpluses, demanding an outlet. European bankers found that
+outlet in Africa, Asia, Australia and the Americas. The stupendous
+strides in the development of the resources in these countries would
+have been impossible but for that surplus of European capital.
+
+The undeveloped countries to-day have the same characteristics,--virgin
+resources, industrial and commercial possibilities, and in many cases
+cheap labor. This is true, for example, in China, Mexico and India. It
+is true to a less extent in South America and South Africa. The logical
+destination of capital is the point where the investment will "pay."
+
+The investor who has used up the cream of the home investment market
+turns his eyes abroad. As a recent writer has suggested, "There is a
+glamor about the foreign investment" which does not hold for a domestic
+one. Foreign investments have yielded such huge returns in the past that
+there is always a seeming possibility of wonderful gains for the future.
+The risk is greater, of course, but this is more than offset by the
+increased rate of return. If it were not so, the wealth would be
+invested at home or held idle.
+
+
+4. _The Great Investing Nations_
+
+The great industrial nations are the great investing nations. An
+agriculture community produces little surplus wealth. Land values are
+low, franchises and special privileges are negligible factors. There can
+be relatively little speculation. Changes in method of production are
+infrequent. Changes in values and total wealth are gradual. The owning
+class in an agriculture civilization may live comfortably. If it is very
+small in proportion to the total population it may live luxuriously, but
+it cannot derive great revenues such as those secured by the owning
+classes of an industrial civilization.
+
+Industrial civilization possesses all of the factors for augmenting
+surplus wealth which are lacking in agricultural civilizations. Changes
+in the forms of industrial production are rapid; special privilege
+yields rich returns and is the subject of wide speculative activity;
+land values increase; labor saving machinery multiplies man's capacity
+to turn out wealth. As much surplus wealth might be produced in a year
+of this industrial life as could have been turned out in a generation or
+a century of agricultural activity or of hand-craft industry.
+
+England, France, Germany, Holland, Belgium, Japan and the United States,
+the great industrial nations, have become the great lending nations.
+Their search for "undeveloped territory" and "spheres of influence" is
+not a search for trade, but for an opportunity to invest and exploit. If
+these nations wished to exchange cotton for coffee, or machinery for
+wheat on even terms, they could exchange with one another, or with one
+of the undeveloped countries, but they demand an outlet for surplus
+wealth--an outlet that can only be utilized where the government of the
+developed country will guarantee the investment of its citizens in the
+undeveloped territory.
+
+The investing nations either want to take the raw products of the
+undeveloped country, manufacture them and sell them back as finished
+material (the British policy in India), or else they desire to secure
+possession of the resources, franchises and other special privileges in
+the undeveloped country which they can exploit for their own profit (the
+British policy in South America).
+
+The Indians, under the British policy, are thus in relatively the same
+position as the workers in one of the industrial countries. They are
+paid for their raw material a fraction of the value of the finished
+product. They are expected to buy back the finished product, which is a
+manifest impossibility. There is thus a drastic limitation on the
+exploitation of undeveloped countries, just as there is a limitation on
+the exploitation of domestic labor. In both cases the people as
+consumers can buy back less in value than the exploiters have to sell.
+Obviously the time must come when all the undeveloped sections of the
+world have been exploited to the limit. Then surplus will go a-begging.
+
+Some of the investors in the great exploiting nations have abandoned the
+idea of making huge returns by way of the English policy in India.
+Instead the investors in every nation are buying up resources,
+franchises and concessions and other special privileges in the
+undeveloped countries and treating them in exactly the same way that
+they would treat a domestic investment. In this case the resources and
+labor of the undeveloped country are exploited for the profit of the
+foreign investor.
+
+The Roman conquerors subjugated the people politically and then exacted
+an economic return in the form of tribute. The modern imperialists do
+not bother about the political machinery, so long as it remains in
+abeyance, but content themselves with securing possession of the
+economic resources of a region and exacting a return in interest and
+dividends on the investment. Political tribute is largely a thing of the
+past. In its place there is a new form--economic tribute--which is
+safer, cheaper, and on the whole far superior to the Roman method of
+exploiting undeveloped regions.
+
+
+5. _The American Home Field_
+
+A hundred years ago the United States was an undeveloped country. Its
+resources were virgin. Its wealth possibilities were immense. Both
+domestic and foreign capitalists invested large sums in the canals, the
+railroads and other American commercial and industrial enterprises. The
+rapid economic expansion of recent years has involved the outlay of huge
+sums of new capital.
+
+The total capital invested in manufactures was 8,975 millions in 1899
+and 22,791 millions in 1914. The total of railway capital was 11,034
+millions in 1899 and 20,247 millions in 1914. Manufacturing and
+railroading alone secured a capital outlay of over 20 billions in 15
+years. Some idea of the increase in investments may be gained from the
+amount of new stocks and bonds listed annually on the New York Stock
+Exchange. The total amount of new stocks listed for the five years
+ending with 1914 was 1,420 millions; the total of new bonds was 2,226
+million. (_The Financial Review Annual_, 1918, p. 67.) The total capital
+of new companies (with an authorized capital of at least $100,000) was
+in 1918, $2,599,753,600; in 1919, $12,677,229,600, and in the first 10
+months of 1920, $12,242,577,700. (Bradstreets, Nov. 6, 1920, p. 731.)
+The figures showing the amount of stocks and bonds issued do not by any
+means exhaust the field of new capital. Reference has already been made
+to the fact that the United States Steel Corporation, between 1903 and
+1918 increased its issues of stocks and bonds by only $31,600,000,
+while, in the same time its assets increased $987,000,000. The same fact
+is illustrated, on a larger scale, in a summary (_Wall Street Journal_,
+August 7, 1919) of the finances of 104 corporations covering the four
+years, December 31, 1914, to December 31, 1918. During this time, six of
+the leading steel companies of the United States increased their working
+capital by $461,965,000 and their surplus by $617,656,000. This billion
+was taken out of the earnings of the companies. Concerning the entire
+104 corporations, the _Journal_ notes that, "After heavy expenditures
+for new construction and acquisitions, and record breaking dividends,
+they added a total of nearly $2,000,000,000 to working capital." In
+addition, these corporations, in four years, showed a gain of
+$1,941,498,000 in surplus and a gain in inventories of $1,522,000,000.
+
+Considerable amounts of capital are invested in private industry, by
+individuals and partnerships. No record of these investments ever
+appears. Farmers invest in animals, machinery and improved
+buildings--investments that are not represented by stocks or bonds.
+Again, the great corporations themselves are constantly adding to their
+assets without increasing their stock or bond issues. In these and
+other ways, billions of new capital are yearly absorbed by the home
+investment market.
+
+Although most of the enterprises of the United States have been floated
+with American capital, the investors of Great Britain, Holland, France
+and other countries took a hand. In 1913 the capitalists of Great
+Britain had larger investments in the United States than in any other
+country, or than in any British Dominion. (The U. S., 754,617,000
+pounds; Canada and Newfoundland, 514,870,000 pounds; India and Ceylon,
+378,776,000 pounds; South Africa, 370,192,000 pounds and so on.)
+(_Annals_, 1916, Vol. 68, p. 28, Article by C. K. Hobson.) The aggregate
+amount of European capital invested in the United States was
+approximately $6,500,000,000 in 1910. Of this sum more than half was
+British. ("Trade Balance of the United States," George Paisch. National
+Monetary Commission, 1910, p. 175.)
+
+By the beginning of the present century (the U. S. Steel Corporation was
+organized in 1901) the main work of organization inside of the United
+States was completed. The bankers had some incidental tasks before them,
+but the industrial leaders themselves had done their pioneer duty. There
+were corners to be smoothed off, and bearings to be rubbed down, but the
+great structural problems had been solved, and the foundations of world
+industrial empire had been laid.
+
+
+6. _Leaving the Home Field_
+
+The Spanish-American War marks the beginning of the new era in American
+business organization. This war found the American people isolated and
+provincial. It left them with a new feeling for their own importance.
+
+The worlds at home had been conquered. The transcontinental railroads
+had been built; the steel industry, the oil industry, the coal industry,
+the leather industry, the woolen industry and a host of others had been
+organized by a whole generation of industrial organizers who had given
+their lives to this task.
+
+Across the borders of the United States--almost within arm's reach of
+the eager, stirring, high-strung men of the new generation, there were
+tens of thousands of square miles of undeveloped territory--territory
+that was fabulously rich in ore, in timber, in oil, in fertility. On
+every side the lands stretched away--Mexico, the West Indies, Central
+America, Canada--with opportunity that was to be had for the taking.
+
+Opportunity called. Capital, seeking new fields for investment, urged.
+Youth, enthusiasm and enterprise answered the challenge.
+
+The foreign investments of the United States at the time of the
+Spanish-American War were negligible. By 1910 American business men had
+two billions invested abroad--$700,000,000 in Mexico; $500,000,000 in
+Canada; $350,000,000 in Europe, and smaller sums in the West Indies, the
+Philippines, China, Central and South America. In 1913 there was a
+billion invested in Mexico and an equal amount in Canada. ("Commercial
+Policy," W. S. Culbertson, New York, Appleton, 1919, p. 315.)
+
+Capital flowed out of the United States in two directions:
+
+
+     1. Toward the resources which were so abundant in certain foreign
+     countries.
+
+     2. Toward foreign markets.
+
+
+7. _Building on Foreign Resources_
+
+The Bethlehem Steel Corporation is a typical industry that has built up
+foreign connections as a means of exploiting foreign resources. The
+Corporation has a huge organization in the United States which includes
+10 manufacturing plants, a coke producing company, 11 ship building
+plants, six mines and quarries, and extensive coal deposits in
+Pennsylvania and West Virginia. The Bethlehem Steel Corporation also
+controls ore properties near Santiago, Cuba, near Nipe Bay, Cuba, and
+extensive deposits along the northern coast of Cuba; large ore
+properties at Tofo, Chile, and the Ore Steamship Corporation, a carrying
+line for Chilean and Cuban ore.
+
+The American Smelting and Refining Company is another illustration of
+expansion into a foreign country for the purpose of utilizing foreign
+resources. According to the record of the Company's properties, the
+Company was operating six refining plants, one located in New Jersey;
+one in Nebraska; one in California; one in Illinois; one in Maryland,
+and one in Washington. The Company owned 14 lead smelters and 11 copper
+smelters, located as follows: Colorado, 4; Utah, 2; Texas, 2; Arizona,
+2; New Jersey, 2; Montana, 1; Washington, 1; Nebraska, 1; California, 1;
+Illinois, 1; Chile, 2; Mexico, 6. Among these 25 plants a third is
+located outside of the United States.
+
+These are but two examples. The rubber, oil, tobacco and sugar interests
+have pursued a similar policy--extending their organization in such a
+way as to utilize foreign resources as a source for the raw materials
+that are destined to be manufactured in the United States.
+
+
+8. _Manufacturing and Marketing Abroad_
+
+The Bethlehem Steel Corporation and the American Smelting and Refining
+Company go outside of the United States for the resources upon which
+their industries depend. Their fabricating industries are carried on
+inside of the country. There are a number of the great industries of the
+country that have gone outside of the United States to do their
+manufacturing and to organize the marketing of their products.
+
+The International Harvester Company has built a worldwide organization.
+It manufactures harvesting machinery, farm implements, gasoline engines,
+tractors, wagons and separators at Springfield, Ohio; Rock Falls, Ill.;
+Chicago, Ill.; Auburn, New York; Akron, Ohio; Milwaukee, Wisc., and
+West Pullman, Ill. It has iron mines, coal mines and steel plants
+operated by the Wisconsin Steel Company. It has three twine mills and
+four railways. Foreign plants and branches are listed as follows:
+Norrkoping, Sweden; Copenhagen, Denmark; Christiania, Norway; Paris,
+France; Croix, France; Berlin, Germany; Hamilton, Ontario, Canada;
+Zurich, Switzerland; Vienna, Austria; Lubertzy, Russia; Neuss, Germany;
+Melbourne, Australia; London, England; Christ Church, New Zealand.
+
+One of the greatest industrial empires in the world is the Standard Oil
+Properties. It is not possible to go into detail with regard to their
+operations. Space will admit of a brief comment upon one of the
+constituent parts or "states" of the empire--The Standard Oil Company of
+New Jersey. With a capital stock of $100,000,000, this Company, from the
+dissolution of the Standard Oil Company, December 15, 1911, to June 15,
+1918, a period of six and a half years, paid dividends of $174,058,932.
+
+The company describes itself as "a manufacturing enterprise with a large
+foreign business. The company drills oil wells, pumps them, refines the
+crude oil into many forms and sells the product--mostly abroad." (_The
+Lamp_, May, 1918.) The properties of the Company are thus listed:
+
+1. The Company has 13 refineries, seven of them in New Jersey, Maryland,
+Oklahoma, Louisiana and West Virginia. Four of the remaining refineries
+are located in Canada, one is in Mexico and one in Peru.
+
+2. Pipeline properties in New York, New Jersey, Pennsylvania and
+Maryland.
+
+3. A fleet of 54 ocean-going tank steamers with a capacity of 486,480
+dead weight tons. (This is about two per cent of the total ocean-going
+tonnage of the world.)
+
+4. Can and case factories, barrel factories, canning plants, glue
+factories and pipe shops.
+
+5. Through its subsidiary corporations, the Company controls:
+
+a. Oil wells in Pennsylvania, West Virginia, Ohio, Kentucky, Louisiana,
+Arkansas, Mississippi, Texas, California, Peru and Mexico. In connection
+with many of these properties refineries are operated.
+
+b. One subsidiary has 550 marketing stations in Canada. Others market in
+various parts of the United States; in the West Indies; in Central and
+South America; in Germany, Austria, Roumania, the Netherlands, France,
+Denmark and Italy.
+
+The Standard Oil Company of New Jersey comprises only one part--though a
+very successful part--of the Standard Oil Group of industries. It is one
+industrial state in a great industrial empire.
+
+Foreign resources offer opportunities to the exploiter. Foreign markets
+beckon. Both calls have been heeded by the American business interests
+that are busy building the international machinery of business
+organization.
+
+
+9. _International Business and Finance_
+
+The steel, smelting, oil, sugar, tobacco, and harvester interests are
+confined to relatively narrow lines. In their wake have followed general
+business, and above all, financial activities.
+
+The American International Corporation was described by its
+vice-president (Mr. Connick) before a Senate Committee on March 1, 1918.
+"Until the Russian situation became too acute, they had offices in
+Petrograd, London, Paris, Rome, Mexico City. They sent commissions and
+agents and business men to South America to promote trade.... They were
+negotiating contracts for a thousand miles of railroad in China. They
+were practically rebuilding, you might say, the Grand Canal in China.
+They had acquired the Pacific Mail.... They then bought the New York
+Shipbuilding Corporation to provide ships for their shipping interests."
+
+By 1919 (_New York Times_, Oct. 31, 1919) the Company had acquired
+Carter Macy & Co., and the Rosin and Turpentine Export Co., and was
+interested in the International Mercantile Marine and the United Fruit
+Companies.
+
+Another illustration of the same kind of general foreign business
+appeared in the form of an advertisement inserted on the financial page
+of the _New York Times_ (July 10, 1919) by three leading financial
+firms, which called attention to a $3,000,000 note issue of the Haytian
+American Corporation "Incorporated under the laws of the State of New
+York, owning and operating sugar, railroad, wharf and public utility
+companies in the Republic of Hayti." Further, the advertisers note: "The
+diversity of the Company's operations assures stability of earnings."
+
+American manufacturers, traders and industrial empire builders have not
+gone alone into the foreign field. The bankers have accompanied them.
+
+Several of the great financial institutions of the country are
+advertising their foreign connections.
+
+The Guaranty Trust Company (_New York Times_, Jan. 10, 1919) advertises
+under the caption "Direct Foreign Banking Facilities" offering "a direct
+and comprehensive banking service for trade with all countries." These
+connections include:
+
+1. Branches in London and Paris, which are designated United States
+depositories. "They are American institutions conducted on American
+lines, and are especially well equipped to render banking service
+throughout Europe." There are additional branches in Liverpool and
+Brussels. The Company also has direct connections in Italy and Spain,
+and representatives in the Scandinavian countries.
+
+2. "Direct connections with the leading financial institutions in
+Argentina, Uruguay, Chile, and Brazil." A special representative in
+Buenos Ayres. "Through our affiliation with the Mercantile Bank of the
+Americas and its connections, we cover Peru, Northern Brazil, Columbia,
+Ecuador, Venezuela, Nicaragua, Honduras, Guatemala, and other South and
+Central American countries."
+
+3. "Through the American Mercantile Bank of Cuba, at Havana, we cover
+direct Cuba and the West Indies."
+
+4. "Direct banking and merchant service throughout British India,"
+together with correspondents in the East Indies and the Straits
+Settlements.
+
+5. "Direct connections with the National Bank of South Africa, at Cape
+Town, and its many branches in the Transvaal, Rhodesia, Natal,
+Mozambique, etc."
+
+6. Direct banking connections and a special representative in Australia
+and New Zealand.
+
+7. "Through our affiliations with the Asia Banking Corporation we
+negotiate, direct, banking transactions of every nature in China,
+Manchuria, Southeastern Siberia, and throughout the Far East. The Asia
+Banking Corporation has its main office in New York and is establishing
+branches in these important trade centers: Shanghai, Pekin, Tientsin,
+Hankow, Harbin, Vladivostok. We are also official correspondents for
+leading Japanese banks."
+
+The advertisement concludes with this statement: "Our Foreign Trade
+Bureau collects and makes available accurate and up-to-date information
+relating to foreign trade--export markets, foreign financial and
+economic conditions, shipping facilities, export technique, etc. It
+endeavors to bring into touch buyers and sellers here and abroad."
+
+The same issue of the _Times_ carries a statement of the Mercantile Bank
+of the Americas which "offers the services of a banking organization
+with branches and affiliated banks in important trade centers throughout
+Central and South America, France and Spain." The Bank describes itself
+as "an American Bank for Foreign trade." Among its eleven directors are
+the President and two Vice-Presidents of the Guaranty Trust Company.
+
+The Asia Banking Corporation, upon which the Guaranty Trust Company
+relies for its Eastern connections, was organized in 1918 "to engage in
+international and foreign banking in China, in the dependencies and
+insular possessions of the United States, and, ultimately in Siberia"
+(_Standard Corporation Service_, May-August, 1918, p. 42). The officers
+elected in August 1918, were Charles H. Sabin, President of the Guaranty
+Trust Co., President; Albert Breton, Vice-President of the Guaranty
+Trust Co., and Ralph Dawson, Assistant Secretary of the Guaranty Trust
+Company, Vice-Presidents, and Robert A. Shaw, of the overseas division
+of the Guaranty Trust Company, Treasurer. Among the directors are
+representatives of the Bankers Trust Company and of the Mercantile Bank
+of the Americas.
+
+
+10. _The National City Bank_
+
+The National City Bank of New York--the first bank in the history of the
+Western Hemisphere to show resources exceeding one billion
+dollars--illustrates in its development the cyclonic changes that the
+past few years have brought into American business circles. The National
+City Bank, originally chartered in 1812, had resources of $16,750,929 in
+1879 and of $18,214,823 in 1889. From that point its development has
+been electric. The resources of the Bank totaled 128 millions in 1899;
+280 millions in 1909; $1,039,418,324 in 1919. Between 1889 and 1899 they
+increased 600 per cent; between 1899 and 1919 they increased 700 per
+cent; during the 40 years from 1889 and 1919 the increase in resources
+exceeded six thousand per cent.
+
+The organization of the Bank is indicative of the organization of modern
+business. Among the twenty-one directors, all of whom are engaged in
+some form of business enterprise, there are the names of William
+Rockefeller, Percy A. Rockefeller, J. Ogden Armour, Cleveland H. Dodge
+of the Phelps-Dodge Corporation, Cyrus H. McCormick of the International
+Harvester Co., Philip A. S. Franklin, President of the International
+Mercantile Marine Co.; Earl D. Babst, President of the American Sugar
+Refining Co.; Edgar Palmer, President of the New Jersey Zinc Co.;
+Nathan C. Kingsbury, Vice-President of the Union Pacific Railroad Co.,
+and Frank Krumball, Chairman of the Chesapeake & Ohio Railroad Co. Some
+of the most powerful mining, manufacturing, transportation and public
+utility interests in the United States are represented, directly or
+indirectly, in this list.
+
+The domestic organization of the Bank consists of five divisions, each
+one under a vice-president. New York City constitutes the first
+division; the second division comprises New England and New York State
+outside of New York City; the three remaining divisions cover the other
+portions of the United States. Except for the size and the completeness
+of its organization, the National City Bank differs in no essential
+particulars from numerous other large banking institutions. It is a
+financial superstructure built upon a massive foundation of industrial
+enterprise.
+
+The phase of the Bank's activity that is of peculiar significance at the
+present juncture is its foreign organization, all of which has been
+established since the outbreak of the European war.
+
+The foreign business of the National City Bank is carried on by the
+National City Bank proper and the International Banking Corporation. The
+first foreign branch of the National City Bank was established at Buenos
+Aires on November 10th, 1914. On January 1st, 1919, the National City
+Bank had a total of 15 foreign branches; on December 31st, 1919, it had
+a total of 74 foreign branches.
+
+The policy of the Bank in its establishment of foreign branches is
+described thus in its "Statement of Condition, December 31st, 1919":
+"The feature of branch development during the year was the expansion in
+Cuba, where twenty-two new branches were opened, making twenty-four in
+the island. Cuba is very prosperous, as a result of the expansion of the
+sugar industry, and as sugar is produced there under very favorable
+conditions economically, and the location is most convenient for
+supplying the United States, the industry is on a sound basis, and
+relations with the United States are likely to continue close and
+friendly. Cuba is a market of growing importance to the United States,
+and the system of branches established by the Bank is designed to serve
+the trade between the two countries." The trader and the Banker are to
+work hand in hand.
+
+The National City Bank has branches in Argentina, Brazil, Belgium,
+Chile, Colombia, Cuba, Italy, Porto Rico, Russia, Siberia, Spain,
+Trinidad, Uruguay and Venezuela, all of which have been established
+since 1914.
+
+A portion of the foreign business of the National City Bank is conducted
+by the International Banking Corporation which was established in 1902
+and which became a part of the National City Bank organization in 1915.
+The International Banking Corporation has a total of twenty-eight
+branches located in California, China, England, France, India, Japan,
+Java, Dominican Republic, Philippine Islands, Republic of Panama and the
+Straits Settlements. Under this arrangement, the financial relations
+with America are made by the National City Bank proper; while those with
+Europe and Asia are in the hands of the International Banking
+Corporation and the combination provides the Bank with 75 branches in
+addition to its vast organization within the United States.
+
+The National City Bank of 1889, with its resources of eighteen millions,
+was a small affair compared with the billion dollar resources of 1920.
+Thirty years sufficed for a growth from youth to robust adulthood.
+Within five years, the Bank built up a system of foreign branches that
+make it one of the most potent States in the federation of international
+financial institutions.
+
+
+11. _Onward_
+
+Exploiters of foreign resources, manufacturers, traders and bankers have
+moved, side by side, out of the United States into the foreign field.
+Step by step they have advanced, rearing the economic structure of
+empire as they went.
+
+The business men of the United States had no choice. They could not
+pause when they had spanned the continent. Ambition called them, surplus
+compelled them, profits lured them, the will to power dominated their
+lives. As well expect the Old Guard to pause in the middle of a
+charge--even before the sunken road at Waterloo--as to expect the
+business interests of the United States to cease their efforts and lay
+down their tools of conquest simply because they had reached the ocean
+in one direction. While there were left other directions in which there
+was no ocean; while other undeveloped regions offered the possibility of
+development, an inexorable fate--the fate inherent in the economic and
+the human stuff with which they were working compelled them to cry
+"Onward!" and to turn to the tasks that lay ahead.
+
+The fathers and grandfathers of these Twentieth Century American
+Plutocrats, working coatless in their tiny factories; managing their
+corner stores; serving their local banks, and holding their minor
+offices had never dreamed of the destiny that lay ahead. No matter. The
+necessity for expansion had come and with it came the opportunity. The
+economic pressure complemented the human desire for "more." The
+structure of business organization, which was erected to conquer one
+continent could not cease functioning when that one continent was
+subdued. Rather, high geared and speeded up as it was, it was in fine
+form to extend its conquests, like the well groomed army that has come
+scatheless through a great campaign, and that longs, throughout its
+tensely unified structure to be off on the next mission.
+
+The business life of the United States came to the Pacific; touched the
+Canadian border; surged against the Rio Grande. The continent had been
+spanned; the objective had been attained. Still, the cry was "Onward!"
+
+Onward? Whither?
+
+Onward to the lands where resources are abundant and rich; onward where
+labor is plentiful, docile and cheap; onward where the opportunities
+for huge profits are met with on every hand; onward into the undeveloped
+countries of the world.
+
+The capitalists of the European nations, faced by a similar necessity
+for expansion, had been compelled to go half round the earth to India,
+to South Africa, to the East Indies, to China, to Canada, to South
+America. Close at home there was no country except Russia that offered
+great possibilities of development.
+
+The business interests of the United States were more fortunate. At
+their very doors lay the opportunities--in Canada, in Mexico, in the
+West Indies, in Central and South America. Here were countries with the
+amplest, richest resources; countries open for capitalist development.
+To be sure these investment fields had been invaded already by foreign
+capitalists--British, German, Belgian and Spanish. But at the same time
+they were surrounded by a tradition of great virility and power--the
+tradition of "America for the Americans."
+
+
+
+
+XI. THE GREAT WAR
+
+
+1. _Daylight_
+
+The work of industrial empire building had continued for less than half
+a century when the United States entered the Great War, which was one in
+a sequence of events that bound America to the wheel of destiny as it
+bound England and France and Germany and Japan and every other country
+that had adopted the capitalist method of production.
+
+The war-test revealed the United States to the world and to its own
+people as a great nation playing a mighty rôle in international affairs.
+Most Europeans had not suspected the extent of its power. Even the
+Americans did not realize it. Nevertheless, the processes of economic
+empire building had laid a foundation upon which the superstructure of
+political empire is reared as a matter of course. Henceforth, no one
+need ask whether the United States should or should not be an imperial
+nation. There remained only the task of determining what form American
+imperialism should take.
+
+The Great War rounded out the imperial beginnings of the United States.
+It strengthened the plutocracy at home; it gave the United States
+immense prestige abroad.
+
+The Era of Imperialism dawned upon the United States in 1898. Daylight
+broke in 1914, and the night of isolation and of international
+unimportance gave place to a new day of imperial power.
+
+
+2. _Plutocracy in the Saddle_
+
+The rapid sweep across a new continent had placed the resources of the
+United States in the hands of a powerful minority. Nature had been
+generous and private ownership of the inexhaustible wilderness seemed to
+be the natural--the obvious method of procedure.
+
+The lightning march of the American people across the continent gave
+the plutocracy its grip on the natural resources. The revolutionary
+transformations in industry guaranteed its control of the productive
+machinery.
+
+The wizards of industrial activity have changed the structure of
+business life even more rapidly than they have conquered the wilderness.
+True sons of their revolutionary ancestors, they have slashed and
+remodeled and built anew with little regard for the past.
+
+Revolutions are the stalking grounds of predatory power. Napoleon built
+his empire on the French Revolution; Cromwell on the revolt against
+tyrannical royalty in England. Peaceful times give less opportunity to
+personal ambition. Institutions are well-rooted, customs and habits are
+firmly placed, life is regulated and held to earth by a fixed framework
+of habit and tradition.
+
+Revolution comes--fiercely, impetuously--uprooting institutions,
+overthrowing traditions, tearing customs from their resting places. All
+is uncertainty--chaos, when, lo! a man on horseback gathers the loose
+strands together saying, "Good people, I know, follow me!"
+
+He does know; but woe to the people who follow him! Yet, what shall they
+do? Whither shall they turn? How shall they act? Who can be relied upon
+in this uncertain hour?
+
+The man on horseback rises in his stirrups--speaking in mighty accents
+his message of hope and cheer, reassuring, promising, encouraging,
+inspiring all who come within the sound of his voice. His is the one
+assurance in a wilderness of uncertainty. What wonder that the people
+follow where he leads and beckons!
+
+The revolutionary changes in American economic life between the Civil
+War and the War of 1914 gave the plutocrat his chance. He was the man on
+horseback, quick, clever, shrewd, farseeing, persuasive, powerful.
+Through the courses of these revolutionary changes, the Hills, Goulds,
+Harrimans, Wideners, Weyerhausers, Guggenheims, Rockefellers,
+Carnegies, and Morgans did to the American economic organization exactly
+what Napoleon did to the French political organization--they took
+possession of it.
+
+
+3. _Making the Plutocracy Be Good_
+
+The American people were still thinking the thoughts of a competitive
+economic life when the cohorts of an organized plutocracy bore down upon
+them. High prices, trusts, millionaires, huge profits, corruption,
+betrayal of public office took the people by surprise, confused them,
+baffled them, enraged them. Their first thought was of politics, and
+during the years immediately preceding the war they were busy with the
+problem of legislating goodness into the plutocracy.
+
+The plutocrats were in public disfavor, and their control of natural
+resources, banks, railroads, mines, factories, political parties, public
+offices, governmental machinery, the school system, the press, the
+pulpit, the movie business,--all of this power amounted to nothing
+unless it was backed by public opinion.
+
+How could the plutocracy--the discredited, vilified plutocracy--get
+public opinion? How could the exploiters gain the confidence of the
+American people? There was only one way--they must line up with some
+cause that would command public attention and compel public support. The
+cause that it chose was the "defense of the United States."
+
+
+4. _"Preparedness"_
+
+The plutocracy, with a united front, "went in" for the "defense of the
+United States,"--attacking the people on the side of their greatest
+weakness; playing upon their primitive emotions of fear and hate. The
+campaign was intense and dramatic, featuring Japanese invasions, Mexican
+inroads, and a world conquest by Germany.
+
+The preparedness campaign was a marvel of efficient business
+organization. Its promoters made use of every device known to the
+advertising profession; the best brains were employed, and the country
+was blanketed with preparedness propaganda.
+
+Officers of the Army and Navy were frank in insisting that the defense
+of the United States was adequately provided for. (See testimony of
+General Nelson A. Miles. _Congressional Record_, February 3, 1916, p.
+2265.) Still the preparedness campaign continued with vigor. Congressman
+Clyde H. Tavenner in his speech, "The Navy League Unmasked," showed why.
+He gave facts like those appearing in George R. Kirkpatrick's book,
+"War, What For"; in F. C. Howe's "Why War," and in J. A. Hobson's
+"Imperialism," showing that, in the words of an English authority,
+"patriotism at from 10 to 15 per cent is a temptation for the best of
+citizens."
+
+Tavenner established the connection between the preparedness campaign
+and those who were making profits out of the powder business, the nickel
+business, the copper business, and the steel business, interlocked
+through interlocking directorates; then he established the connection
+between the Navy League and the firm of J. P. Morgan & Co., 23 Wall St.,
+New York. Regarding this connection, Congressman Tavenner said, "The
+Navy League upon close examination would appear to be little more than a
+branch office of the house of J. P. Morgan & Co., and a general sales
+promotion bureau for the various armor and munition makers and the
+steel, nickel, copper and zinc interests."[45]
+
+The preparedness movement came from the business interests. It was
+fostered and financed by the plutocrats. It was their first successful
+effort at winning public confidence, and so well was it managed that
+millions of Americans fell into line, fired by the love of the flag and
+the world-old devotion to family and fireside.
+
+
+5. _Patriots_
+
+From preparedness to patriotism was an easy step. The preparedness
+advocates had evoked the spirit of the founders of American democracy
+and worked upon the emotions of the people until it was generally
+understood that those who favored preparedness were patriots.
+
+Plutocratic patriotism was accepted by the press, the pulpit, the
+college, and every other important channel of public information in the
+United States. Editors, ministers, professors and lawyers proclaimed it
+as though it were their own. Randolph Bourne, in a brilliant article
+(_Seven Arts_, July, 1917) reminds his readers of "the virtuous horror
+and stupefaction when they read the manifesto of their ninety-three
+German colleagues in defense of the war. To the American academic mind
+of 1914 defense of war was inconceivable. From Bernhardi it recoiled as
+from a blasphemy, little dreaming that two years later would find it
+creating its own cleanly reasons for imposing military service on the
+country and for talking of the rough rude currents of health and
+regeneration that war would send through the American body politic. They
+would have thought any one mad who talked of shipping American men by
+the hundreds of thousands--conscripts--to die on the fields of
+France...."
+
+The American plutocracy was magnified, deified, and consecrated to the
+task of making the world safe for democracy. Exploiters had turned
+saviors and were conducting a campaign to raise $100,000,000 for the Red
+Cross.[46] The "malefactors of great wealth," the predatory business
+forces, the special privileged few who had exploited the American people
+for generations, became the prophets and the crusaders, the keepers of
+the ark of the covenant of American democracy.
+
+Radicals who had always opposed war, ministers who had spent their lives
+preaching peace upon earth, scientists whose work had brought them into
+contact with the peoples of the whole world, public men who believed
+that the United States could do greater and better work for democracy by
+staying out of the war, were branded as traitors and were persecuted as
+zealously as though they had sided with Protestantism in Catholic Spain
+under the Inquisition.
+
+By a clever move, the plutocrats, wrapped in the flag and proclaiming a
+crusade to inaugurate democracy in Germany, rallied to their support the
+professional classes of the United States and millions of the common
+people.
+
+
+6. _Business in Control_
+
+After the declaration of war, the mobilization and direction of the
+economic war work of the government was placed in the hands of the
+Council of National Defense, an organized group of the leading business
+men. The Council consisted of six members of the President's Cabinet,
+assisted by an Advisory Commission and numerous sub-committees. The
+"Advisory Commission" of the Council (the real working body) contained
+four business men, an educator, a labor leader and a medical man. ("The
+Council of National Defense" a bulletin issued by the Council under date
+of June 28, 1917.)
+
+Each member of the Advisory Commission had a group of persons
+coöperating with him. The make-up of these various committees was
+significant. Among 706 persons listed in the original schedule of
+sub-committees, 404 were business men, 200 were professional men, 59
+were labor men, 23 were public officials and 20 were miscellaneous. It
+was only in Mr. Gompers' group that labor had any representation, and
+even there, out of 138 persons only 59 were workers or officials of
+unions, while 34 were business men and 33 professional men, so that
+among Mr. Gompers' assistants the business and professional men combined
+considerably outnumbered the labor men.
+
+The make-up of some of the sub-committees revealed the forces behind the
+Defense Council. Thus Mr. Willard's sub-committee on "Express" consisted
+of four vice-presidents, one from the American, one from the
+Wells-Fargo, one from the Southern and one from the Adams Express
+Company. His committee on "Locomotives" consisted of the Vice-President
+of the Porter Locomotive Company, the President of the American
+Locomotive Company, and the Chairman of the Lima Locomotive Corporation.
+Mr. Rosenwald's committee on "Shoe and Leather Industries" consisted of
+eight persons, all of them representing shoe or leather companies. His
+committee on "Woolen Manufactures" consisted of eight representatives of
+the woolen industry. The same business supremacy appeared in Mr.
+Baruch's committees. His committee on "Cement" consisted of the
+presidents of four of the leading cement companies, the vice-president
+of a fifth cement company, and a representative of the Bureau of
+Standards of Washington. His committee on "Copper" had the names of the
+presidents of the Anaconda Copper Company, the Calumet & Hecla Mining
+Company, the United Verde Copper Company and the Utah Copper Company.
+His committee on "Steel and Steel Products" consisted of Elbert H. Gary,
+Chairman of the United States Steel Corporation; Charles M. Schwab, of
+the Bethlehem Steel Company; A. C. Dinkey, Vice-President of the Midvale
+Steel Company; W. L. King, Vice-President of Jones & Loughlin Steel
+Company, and J. A. Burden, President of the Burden Steel Company. The
+four other members of the committee represented the Republic Iron and
+Steel Company, the Lackawanna Steel Company, the American Iron and Steel
+Institute and the Picklands, Mather Co., of Cleveland. Perhaps the most
+astounding of all the committees was that on "Oil." The chairman was the
+President of the Standard Oil Company, and the secretary of the
+committee gives his address as "26 Broadway," the address of the
+Standard Oil Company. The other nine members of the committee were oil
+men from various parts of the country. What thinking American would have
+suggested, three years before, that the Standard Oil Company would be
+officially directing a part of the work of the Federal Government?
+
+Comment is superfluous. Every great industrial enterprise of the United
+States had secured representation on the committees of business men that
+were responsible for the direction of the economic side of war making.
+
+Then came the Liberty Loan campaigns and Red Cross drives, the direction
+of which also was given into the hands of experienced business men. In
+each community, the leaders in the business world were the leaders in
+these war-time activities. Since the center of business life was the
+bank, it followed that the directing power in all of the war-time
+campaigns rested with the bankers, and thus the whole nation was
+mobilized under the direction of its financiers.
+
+The results of these experiences were far-reaching. During two
+generations, the people of the United States had been passing anti-trust
+laws and anti-pooling laws, the aim of which was to prevent the business
+men of the country from getting together. The war crisis not only
+brought them together, but when they did assemble, it placed the whole
+political and economic power of the nation in their hands.
+
+The business men learned, by first hand experience, the benefits that
+arise from united effort. They joined forces across the continent, and
+they found that it paid. James S. Alexander, President of the National
+Bank of Commerce (New York), tells the story from the standpoint of a
+banker (_Manchester Guardian_, January 28, 1920. Signed Article.) In a
+discussion of "the experience in coöperative action which the war has
+given American banks" he says, "The responsibility of floating the five
+great loans issued by the government, together with the work of
+financing a production of materials speeded up to meet war necessities,
+enforced a unity of action and coöperation which otherwise could hardly
+have been obtained in many years."
+
+
+7. _Economic Winnings_
+
+The war gains of the plutocracy in the field of public control were
+important, as well as spectacular. Behind them, however, were economic
+gains--little heralded, but of the most vital consequence to the future
+of plutocratic power.
+
+The war speeded production and added greatly to the national income, to
+investable surplus, to profits and thus to the economic power of the
+plutocrats.
+
+The most tangible measure of the economic advantage gained by the
+plutocracy from the war is contained in a report on "Corporate Earnings
+and Government Revenues" (Senate Document 259. 65th Congress, Second
+Session). This report shows the profits made by the various industries
+during 1917--the first war year.
+
+The report contains 388 large pages on which are listed the profits
+("percent of net income to capital stock in 1917") made by various
+concerns. A typical food producing industry--"meat packing"--lists 122
+firms (p. 95 and 365). Of these firms 31 reported profits for the year
+of less than 25 percent; 45 reported profits of 25 but under 50 percent;
+24 reported profits of 50 but under 100 percent, and 22 reported profits
+of 100 percent or more. In this case, a third of the profits were more
+than 25, but less than 50 percent, and half were 50 percent or over.
+
+Manufacturers of cotton yarns reported profits ranging slightly higher
+than those in the meat packing industry (pp. 167, 168, 379). Among the
+153 firms reporting, 21 reported profits of less than 25 percent; 61
+reported 25 but less than 50 per cent; 55 reported 50 but under 100
+percent, and 16 reported 100 percent or more.
+
+Profits in the garment manufacturing industry were lower than those in
+yarn manufacturing. Among the 299 firms reporting (pp. 171, 380) 74 gave
+their profits as less than 25 percent; 121 gave their profits as 25 but
+under 50 percent; 65 gave profits of 50 but less than 100 percent, and
+39 gave their profits as 100 percent or over.
+
+The profits of 49 Steel plants and Rolling Mills (pp. 100, 365) were
+considerably higher than profits in any of the industries heretofore
+discussed. Four firms reported profits of less than 25 percent; 13
+reported profits of 25 but less than 50 percent; 17 reported profits of
+50 but less than 100 percent, and 15 reported profits of more than 100
+percent. In this instance two-thirds of the firms show profits of 50
+percent or over.
+
+Bituminous Coal producers in the Appalachian field (340 in number, pp.
+130 and 372) report a range of profits far higher than those secured in
+the manufacturing industries. Among these 340 firms, 23 reported profits
+of less than 25 percent; 45 reported profits of 25 but under 50 percent;
+79 reported profits of 50 but under 100 percent; 135 reported profits of
+100 but under 500 percent; 21 reported profits of 500 but under 1,000
+percent, and 14 reported profits of 1,000 percent and over. In the case
+of these coal mine operators only a fourth had profits of under 50
+percent and half had profits of more than 100 percent.
+
+The profits in these five industries--food, yarn, clothing, steel and
+coal--are quite typical of the figures for the tens of thousands of
+other firms listed in Senate Document 259. Profits of less than 25
+percent are the exception. Profits of over 100 percent were reported by
+8 percent of the yarn manufacturers, by 13 percent of the garment
+manufacturers, by 18 percent of the meat packers, by 31 percent of the
+steel plants, and by 50 percent of the bituminous coal mines. A
+considerable number of profits ranged above 500 percent, or a gain in
+one year of five times the entire capital stock.
+
+When it is remembered that these figures were supplied by the firms
+involved; that they were submitted to a tremendously overworked
+department, lacking the facilities for effective checking-up; and that
+they were submitted for the purposes of heavy taxation, the showing is
+nothing less than astounding.
+
+
+8. _Winnings in the Home Field_
+
+What has the American plutocracy won at home as a result of the war? In
+two words it has gained social prestige and internal (economic)
+solidarity. Both are vital as the foundation for future assertions of
+power.
+
+The plutocracy has unified its hold upon the country as a result of the
+war. Also, it has won an important battle in its struggle with labor.
+The position held by the American plutocracy at the end of the Great War
+could hardly be stated more adequately than in a recent Confidential
+Information Service furnished by an important agency to American
+business men:
+
+
+     "SHALL VICTORS BE MAGNANIMOUS?
+
+
+"There is no doubt about it--Labor is beaten. Mr. Gompers was at his
+zenith in 1918. Since then he has steadily lost power. He has lost power
+with his own people because he is no longer able to deliver the goods.
+He can no longer deliver the goods for two reasons. For one thing, peace
+urgency has replaced war urgency and we are not willing to bid for peace
+labor as we were willing to bid for war labor. For another thing, the
+employing class is immensely more powerful than it was in 1914.
+
+"We have an organized labor force more numerous than ever before.
+Relatively twice as many workers are organized as in 1916. But this same
+labor force has lost its hold on the public. Furthermore, it is divided
+in its own camp. It fears capital. It also fears its own factions. It
+threatens, but it does not dare.
+
+"We said that the employing class was immensely more powerful than in
+1914. There is more money at its command. Eighteen thousand new
+millionaires are the war's legacy. This money capacity is more
+thoroughly unified than ever. In 1914 we had thirty-thousand banks,
+functioning to a great degree in independence of each other. Then came
+the Federal Reserve Act and gave us the machinery for consolidation and
+the emergency of five years war furnished the hammer blows to weld the
+structure into one.
+
+"The war taught the employing class the secret and the power of
+widespread propaganda. Imperial Europe had been aware of this power. It
+was new to the United States. Now, when we have anything to sell to the
+American people we know how to sell it. We have learned. We have the
+schools. We have the pulpit. The employing class owns the press. There
+is practically no important paper in the United States but is theirs!"
+
+
+9. _The Run of the World_
+
+The war gains of the American plutocracy at home were immense. Even more
+significant, from an imperial standpoint, were the international
+advantages that came to America with the war. The events of the two
+years between 1916 and 1918 gave the United States the run of the world.
+
+Destiny seemed to be bent upon hurling the American people into a
+position of world authority. First, there was the matter of credit. The
+Allies were reaching the end of their economic rope when the United
+States entered the war. They were not bankrupt, but their credit was
+strained, their industries were disorganized, their sources of income
+were narrowed, and they were looking anxiously for some source from
+which they might draw the immense volume of goods and credit that were
+necessary for the continuance of the struggle.[47]
+
+The United States was that source of supply. During the years from 1915
+to 1917, the industries of the United States were shifted gradually from
+a peace basis to a war basis. Quantities of material destined for use in
+the war were shipped to the Allies. The unusual profits made on much of
+this business were not curtailed by heavy war taxation. Thus for more
+than two years the basic industries of the United States reaped a
+harvest in profits which were actually free of taxation, at the same
+time that they placed themselves on a war basis for the supplying of
+Europe's war demand. When the United States did enter the war, she came
+with all of the economic advantages that had arisen from selling war
+material to the belligerents during two and a half years. Throughout
+those years, while the Allies were bleeding and borrowing and paying,
+the American plutocracy was growing rich.
+
+When the United States entered the war, she entered it as an ally of
+powers that were economically winded. She herself was fresh. With the
+greatest estimated wealth of any of the warring countries, she had a
+public national debt of less than one half of one percent of her total
+wealth. She had larger quantities of liquid capital and a vast economic
+surplus. As a consequence, she held the purse strings and was able,
+during the next two years, to lend to the Allied nations nearly ten
+billion dollars without straining her resources to any appreciable
+degree.
+
+The nations of Europe had been so deeply engrossed in war-making that
+they had been unable to provide themselves with the necessary food. All
+of the warring countries, with the exception of Russia, were importers
+of food in normal times. The disturbances incident to the war; the
+insatiable army demands, and the loss of shipping all had their effect
+in bringing the Allied countries to a point of critical food scarcity in
+the Winter of 1916-1917.
+
+The United States was able to meet this food shortage as easily as it
+met the European credit shortage--and with no greater sacrifice on the
+part of the American people. Then, too, with the exception of small
+amounts of food donated through relief organizations, the food that
+went to Europe was sold at fancy prices. The United States was therefore
+in a position to lay down the basic law,--"Submit or starve."
+
+With the purse strings and the larder under American control, the
+temporary supremacy of the United States was assured. She was the one
+important nation (beside Japan) that had lost little and gained much
+during the war. She was the only great nation with a surplus of credit,
+of raw materials and of food.
+
+The prosperity incident to this period is reflected in the record of
+American exports, which rose from an average of about two billions in
+the years immediately preceding the war to more than six billions in
+1917. In the same year the imports were just under three billions,
+leaving a trade balance--that is, a debt owing by foreign countries to
+the United States--of more than three billions for that one year.
+
+
+10. _Victory_
+
+The war had been in progress for nearly three years before the United
+States took her stand on the side of the Allies. At that time the flower
+of Europe's manhood had faced, for three winters, a fearful pressure of
+hardship and exposure, while millions among the non-combatants had
+suffered, starved, sickened and died. The nerves of Europe were worn and
+the belly of Europe was empty when the American soldiers entered the
+trenches. They were never compelled to bear the brunt of the conflict.
+They arrived when the Central Empires were sagging. Their mere presence
+was the token of victory.
+
+For the first time in history the Americans were matched against the
+peoples of the old world on the home ground of the old world, and under
+circumstances that were enormously favorable to the Americans. European
+capitalism had weakened itself irreparably. The United States entered
+the war at a juncture that enabled her to take the palm after she had
+already taken billions of profit without risk or loss. The gain to the
+United States was immense, beyond the possibility of present estimate.
+The rulers of the United States became, for the time being, at least,
+the economic dictators of the world.
+
+The Great War brought noteworthy advantages to the American plutocracy.
+At home its power was clinched. Among the nations, the United States was
+elevated by the war into a position of commanding importance. In a
+superficial sense, at least, the Great War "made" the plutocracy at home
+and "made" the United States among the nations.
+
+FOOTNOTES:
+
+[45] "The Navy League Unmasked," Speech of December 15, 1915,
+_Congressional Record_.
+
+[46] This campaign was conducted by H. P. Davison, one of the leading
+members of the firm of J. P. Morgan and Co. Later a great war-fund drive
+was conducted by John D. Rockefeller, Jr. Cleveland H. Dodge of the
+Phelps-Dodge corporation was treasurer of another fund.
+
+[47] J. Maynard Keynes notes the "immense anxieties and impossible
+financial requirements" of the period between the Summer of 1916 and the
+Spring of 1917. The task would soon have become "entirely hopeless" but
+"from April, 1917" the problems were "of an entirely different order."
+"The Economic Consequences of the Peace." New York, Harcourt, Brace &
+Howe, 1920, p. 273.
+
+
+
+
+XII. THE IMPERIAL HIGHROAD
+
+
+1. _A Youthful Traveler_
+
+Along the highroad that leads to empire moves the American people, in
+the heyday of its youth, sturdy, vigorous, energy-filled, replete with
+power and promise--conquerors who have swept aside the Indians, enslaved
+a race of black men, subdued a continent, and begun the extension of
+territorial control beyond their own borders. More than a hundred
+million Americans--fast losing their standards of individualism--fast
+slipping under the domination of a new-made ruling class of wealth-lords
+and plutocrats--journey, not discontentedly, along the imperial
+highroad.
+
+The preliminary work of empire-building has been accomplished--territory
+has been conquered; peoples have been subjected and a ruling class
+organized. The policy of imperialism has been accepted by the people,
+although they have not thought seriously of its consequences. They have
+set out, in good faith, as they believe, to seek for life, liberty and
+happiness. They do not yet realize that, along the road that they are
+now traveling, the journey will not be ended until they have worn
+themselves threadbare in their efforts to conquer the earth.
+
+The American people,--lacking in political experience and in world
+wisdom; ignorant of the laws of economic and social change,--have
+committed themselves, unwittingly, to the world old task of setting up
+authority over those who have no desire to accept it, and of exacting
+tribute from those who do not wish to pay it.
+
+The early stages of the journey led across a continent. The American
+people followed it eagerly. Now that the trail leads to other continents
+they are still willing to go.
+
+"Manifest destiny" is the cry of the leaders. "We are called," echo the
+followers, and the nation moves onward.
+
+There was some hesitancy among the American people during the Spanish
+War. Even the leaders were not ready then. Now the leaders are
+prepared--for markets, for trade, for investments. They are indifferent
+to political conquest, but economically they are prepared to go on--into
+Latin America; into Asia; into Europe. The war taught them the lesson
+and gave them an inkling of their power. So they move along the imperial
+highroad--followed by a people who have not yet learned to chant the
+songs of victory--but who are destined, at no very distant date, to
+learn victory's lessons and to pay victory's price. Along the path,--far
+away in the distance they see the earth like a ball, rolling at their
+feet. It is theirs if they will but reach out their hands to grasp it!
+
+
+2. _An Imperial People_
+
+This is the American people--locked in the arms of mighty economic and
+social forces; building industrial empires; compelled, by a world war,
+to reach out and save "civilization,"--capitalist civilization,--a
+people that, by its very ancestry, seems destined to follow the course
+of empire.
+
+The sons and daughters of the native born American stock are, in the
+main, the descendants of the conquering, imperial races of the modern
+world. During recent times, three great empires--Spain, France and Great
+Britain--have dominated western civilization. It was these three empires
+that were responsible for the settlement of America. The past generation
+has seen the German empire rise to a position that has enabled her to
+shake the security of the world. The Germans were among the earliest and
+most numerous settlers of the American colonies. Those who boast
+colonial ancestry boast the ancestry of conquerors. The
+Anglo-Saxon-Teutonic races, the titular masters of the modern world;
+the races that have spread their power where-ever ships sail or trade
+moves or gain offers, furnished the bulk of the early immigrants to
+America.
+
+The bulk of the early immigration to the United States was from Great
+Britain and Germany. The records of immigration (kept officially since
+1820) show that between that year and 1840 the immigrants from Europe
+numbered 594,504, among them there were 358,994 (over half) from the
+British Isles, and 159,215 from Germany, making a total from the two
+countries of 518,209, or 87 percent of the immigrants arriving in the
+twenty-year period. During the next twenty years (1840-1860) the total
+of immigrants from Europe was 4,050,159, of which the British Isles
+furnished 2,386,846 (over half) and Germany 1,386,293, making, for these
+two countries, 94 percent of the whole immigration. Even during the
+years from 1860 to 1880, 82 percent of those who migrated to the United
+States hailed from Great Britain and Germany. American immigration, from
+1820 to 1880, might, without any violence to facts, be described as
+Anglo-Teutonic, so completely does the British-German immigrant dominate
+this period.
+
+Literally, it is true that the American people have been sired by the
+masters and would-be masters of the modern earth.
+
+
+3. _A Place in the Sun_
+
+The Americans, like many another growing people, have sought a place in
+the sun--widening their boundaries; grasping at promised riches. Unlike
+other peoples they have accomplished the task without any real
+opposition. Their "promised land" lay all about them, isolated from the
+factional warfare of Europe; virgin; awaiting the master of the Western
+World.
+
+The United States has followed the path of empire with a facility
+unexampled in recent history. When has a people, caught in the net of
+imperialism, encountered less difficulty in making its imperial dream
+come true? None of the foes that the American people have encountered,
+in two centuries of expansion, have been worthy of the name. The Indians
+were in no position to withstand the onslaught of the Whites. The
+Mexicans were even less competent to defend themselves. The Spanish
+Empire crumpled, under attack, like an autumn leaf under the heel of a
+hunter. Practically for the taking, the American people secured a
+richly-stocked, compact region, with an area of three millions of square
+miles--the ideal site for the foundation of a modern civilization.
+
+The area of the United States has increased with marvelous rapidity. At
+the outbreak of the Revolution (1776) the Colonies claimed a territory
+of 369,000 square miles. The Northwest Territory (275,000 square miles)
+and the area south of the Ohio River (205,000 square miles) were added
+largely as a result of the negotiations in 1782. The official figures
+for 1800 give the total area of the United States as 892,135 square
+miles. The Louisiana Purchase (1803) added 885,000 square miles at a
+cost of 15 millions of dollars. Florida, 59,600 square miles, was
+purchased from Spain (1819) for 5 millions of dollars; Texas, 389,000
+square miles was annexed in 1845; the Oregon Country, 285,000 square
+miles, was secured by treaty in 1846; New Mexico and California, 529,000
+square miles, were ceded by Spain (1848) and a payment of 15 millions
+was made by the United States; in 1853 the Gadsen Purchase added 30,000
+square miles at a cost of ten millions of dollars. This completed the
+territorial possessions of the United States on the mainland (with the
+exception of Alaska) making a continental area of 3,026,798 square
+miles. Between 1776 and 1853 the area of the United States was increased
+more than eight fold. What other nation has been in a position to
+multiply its home territory by eight in two generations?
+
+These vast additions to the continental possessions of the United States
+were made as the result of a trifling outlay. The most serious losses
+were involved in the Mexican War when the casualties included more than
+13,000 killed and died of wounds and disease. The net money cost of the
+war did not exceed $100,000,000. In return for this outlay--including
+the annexation of Texas--the United States secured 918,000 square miles
+of land.[48]
+
+There is no way to estimate the loss of life or the money cost of the
+Indian Wars. For the most part, the troops engaged in them suffered no
+more heavily than in ordinary police duty, and the costs were the costs
+of maintaining the regular army. The total money outlay for purchases
+and indemnities was about 45 millions of dollars. Within a century the
+American people gained possession of one of the richest portions of the
+earth's surfaces--a portion equal in area to more than three times the
+combined acreage of Belgium, France, Germany, Italy, Japan and the
+British Isles[49]--in return for an outlay in money and life that would
+not have provided for one first class battle of the Great War.
+
+Additions to the territory of the country were made with equal facility
+during the period following the Civil War. Alaska was purchased from
+Russia for $7,200,000; from Spain, as a result of the War of 1898, the
+United States received the Philippines, Porto Rico, and some lesser
+islands, at the same time paying Spain $20,000,000; Hawaii was annexed
+and an indemnity of $10,000,000 was paid to Panama for the Canal strip.
+During the second half of the nineteenth century, 716,666 square miles
+were added to the possessions of the United States. The total direct
+cost of this territory in money was under forty millions. These gains
+involved no casualties with the exception of the small numbers lost
+during the Spanish-American and Philippine Wars.
+
+One hundred and thirty years have witnessed an addition to the United
+States of more than two and a half million square miles of contiguous,
+continental territory, and three-quarters of a million square miles of
+non-contiguous territory. The area of the United States in 1900 was four
+times as great as it was in 1800 and more than ten times as great as the
+area of the Thirteen Original Colonies. For the imperialist, the last
+century and a half of American history is a fairyland come true.
+
+Other empires have been won by the hardest kind of fighting, during
+which blood and wealth have been spent with a lavish hand. The empire of
+the French, finally crushed with the defeat of Napoleon, was paid for at
+such a huge price. The British Empire has been established in savage
+competition with Holland, Spain, France, Russia, the United States,
+Germany and a host of lesser powers. The empires of old--Assyria, Egypt,
+Rome--were built at an intolerable sacrifice. So terrible has been the
+cost of empire building to some of these nations that by the time they
+had succeeded in creating an empire the life blood of the people and the
+resources of the country were devoured and the empire emerged, only to
+fall an easy prey to the first strong-handed enemy that it encountered.
+
+No such fate has overtaken the United States. On the contrary her path
+has been smoothed before her feet. Inhabiting a garden spot, her immense
+territory gains in the past hundred and fifty years have been made with
+less effort than it has cost Japan to gain and hold Korea or England to
+maintain her dominion over Ireland.
+
+Once established, the old-world empire was not secure. If the territory
+that it possessed was worth having, it was surrounded by hungry-eyed
+nations that took the first occasion to band together and despoil the
+spoiler. The holding of an empire was as great a task as the building of
+empire--often greater because of the larger outlay in men and money that
+was involved in an incessant warfare. Little by little the glory faded;
+step by step militarism made its inroads upon the normal life of the
+people, until the time came for the stronger rival to overthrow the
+mighty one, or until the inrushing hordes of barbarians should blot out
+the features of civilization, and enthrone chaos once more.
+
+How different has been the fate of the people of the United States!
+Possessed of what is probably the richest, for the purposes of the
+present civilization, of any territory of equal size in the world, their
+isolation has allowed them more than a century of practical freedom from
+outside interference--a century that they have been able to devote to
+internal development. The absence of greedy neighbors has reduced the
+expense of military preparation to a minimum; the old world has failed
+to realize, until within the last few years, what were the possibilities
+of the new country; vitality has remained unimpaired, wealth has piled
+up, industry has been promoted, and on each occasion when a greater
+extent of territory was required, it has been obtained at a cost that,
+compared with the experience of other nations, must be described as
+negligible.
+
+So simple has been the process of empire building for the United States;
+so natural have been the stages by which the American Empire has been
+evolved; so little have the changes disturbed the routine of normal life
+that the American people are, for the most part, unaware of the imperial
+position of their country. They still feel, think and talk as if the
+United States were a tiny corner, fenced off from the rest of the world
+to which it owed nothing and from which it expected nothing.
+
+The American Empire has been built, as were the palaces of Aladdin, in a
+night. The morning is dawning, and the early risers who were not even
+awakened from their slumbers by the sound of hammer and engine, are
+beginning to rub their eyes, and to ask one another what is the meaning
+of this apparition, and whether it is real.
+
+
+4. _The Will to Power_
+
+The forces of America are the forces of Empire,--the geography, the
+economic organization, the racial qualities--all press in the direction
+of imperialism. There is logic behind the two centuries of conquest in
+which the American people have been engaged; there is logic in the rise
+of the plutocracy. Now it remains for the rulers of America to accept
+the implications of imperialism,--to thrill with the will to power; to
+recognize and strengthen imperial purpose; to sell imperialism to the
+American people--in other words to follow the call of manifest destiny
+and conquer the earth.
+
+The will to power is very old and very strong. Economic and social
+necessity on the one hand, and the driving pressure of human ambition
+and the love of domination on the other, have given it a front place in
+human affairs. The empires of the past were driven into being by this
+ardent force. As far back as history bears a record, one nation or tribe
+has made war on its more fortunately situated neighbor; one leader has
+made cause against his fellow ruler. The Egyptians and Carthaginians
+have conquered in Africa; the Persians, Assyrians and Babylonians
+conquered in Asia; the Macedonians, Greeks, Romans, Spanish, Dutch,
+French, and British built their empires on one or more of the five
+continents. Conqueror has succeeded conqueror, empire has followed
+empire. Spoils, domination, world power, have been the objects of their
+campaigns.
+
+Each great nation grew from small beginnings. Each arose from some
+simple form of tribal or clan organization--more or less democratic in
+its structure; containing within itself a unified life and a simple folk
+philosophy.
+
+From such plain beginnings empires have developed. The peasants, tending
+their fertile gardens along the borders of the Nile; the vine dressers
+of Italy, the husbandmen and craftsmen of France and the yeomen of Merry
+England had no desire to subjugate the world. If tradition speaks truth,
+they were slow to take upon themselves anything more than the defense of
+their own hearthstones. It was not until the traders sailed across the
+seas; not until stories were brought to them of the vast spoil to be
+had, without work, in other lands, that the peasants and craftsmen
+consented to undertake the task of conquest, subjugation and empire
+building.
+
+The plain people do not feel the will to power. They know only the
+necessities of self-defense. It is in the ambitions of the leisure
+classes that the demands of conquest have their origin. It is among them
+that men dream of world empire.[50]
+
+The plain people of the United States have no will to power at the
+present time. They are only asking to be let alone, in order that they
+may go their several ways in peace. They are babes in the world of
+international politics. For generations they have been separated by a
+great gulf of indifference from the remainder of the human race, and
+they crave the continuance of this isolation because it gives them a
+chance to engage, unmolested, in the ordinary pursuits of life.
+
+The American people are not imperialists. They are proud of their
+country, jealous of her honor, willing to make sacrifices for their dear
+ones. They are to-day where the plain folk of Egypt, Rome, France and
+England were before the will to power gripped the ruling classes of
+those countries.
+
+Far different is the position of the American plutocracy. As a ruling
+class the plutocracy feels the necessity of preserving and enlarging its
+privileges. Recently called into a position of leadership, untrained and
+in a sense unprepared, it nevertheless understands that its claim to
+consideration depends upon its ability to do what the ruling classes of
+Egypt, Rome, France and England have done--to build an empire.
+
+Almost unconsciously, out of the necessities of the period, has come the
+structure of the American Empire. In essence it is an empire, although
+the plain people do not know it, and even the members of the plutocracy
+are in many instances unaware of its true character. Yet here, in a land
+dedicated to liberty and settled by men and women who sought to escape
+from the savage struggles of empire-ridden Europe, the foundations and
+the superstructure of empire appear.
+
+1. The people of the United States have conquered and now hold
+possession of approximately three million square miles of continental
+territory that has been won by armed force from Great Britain, Mexico,
+Spain, and the American Indians. (The entire area of Europe is only
+3,800,000 square miles.)
+
+2. The people of the United States have conquered and now hold under
+their sway subject people who have enjoyed no opportunity for
+self-determination. A whole race--the African Negroes--was captured in
+its native land, transported to America and there sold into slavery. The
+inhabitants of the Philippine Islands were conquered by the armed forces
+of the United States and still are subject people.
+
+3. The United States had developed a plutocracy--a property holding
+class, that is, to all intents and purposes, the imperialist
+class--controlling and directing public policy.
+
+4. This plutocratic class is exploiting continental United States and
+its dependencies. After years of savage internal strife, it has
+developed a high degree of class consciousness, and led by its bankers,
+it is taking the fat of the land. The plutocrats, who have made the
+country their United States, are at the present moment busy disposing of
+their surplus in foreign countries. As they build their industrial
+empires, they broaden and deepen their power.
+
+Thus is the round of imperialism complete. Here are the conquered
+territory, subject people, an imperial ruling class, and the
+exploitation, by this class, of the lands and peoples that come within
+the scope of their power. These are the attributes of empire--the
+characteristics that have appeared, in one form or another, through the
+great empires of the past and of the present day. Differing in their
+forms, they remain similar in the principles that they represent. They
+are imperialism.
+
+
+5. _Imperial Purpose_
+
+The building of international industrial empires by the progressive
+business men of the United States lays the foundation for whatever
+political imperialism is necessary to protect markets, trade and
+investment. Gathering floods of economic surplus are the driving forces
+which are guided by ambition and love of gain and power.
+
+The United States emerged from the Great War in a position of
+unquestioned economic supremacy. With vast stores of all the necessary
+resources, amply equipped with capital, the country has entered the
+field as the most dangerous rival that the other capitalist nations must
+face. Possessed of everything, including the means of providing a navy
+of any reasonable size and an army of any necessary number, the United
+States looms as the dominating economic factor in the capitalist world.
+
+Imperial policy is frequently bold, rough and at times frankly brutal
+and unjust. Where subject peoples and weaker neighbors submit to the
+dictates of the ruling power there is no friction. But where the subject
+peoples or smaller states attempt to assert their rights of
+self-determination or of independence, the empire acts as Great Britain
+has acted in Ireland and in India; as Italy and France have acted in
+Africa; as Japan has acted in Korea; as the United States has acted in
+the Philippines, in Hayti, in Nicaragua, and in Mexico.
+
+Plain men do not like these things. Animated by the belief in popular
+rights which is so prevalent among the western peoples, the masses
+resent imperial atrocities. Therefore it becomes necessary to surround
+imperial action with such an atmosphere as will convince the man on the
+street that the acts are necessary or else that they are inevitable.
+
+When the Church and the State stood together the Czar and the Kaiser
+spoke for God as well as for the financial interests. There was thus a
+double sanction--imperial necessity coupled with divine authority.
+Those who were not willing to accept the necessity felt enough reverence
+for the authority to bow their heads in submission to whatever policy
+the masters of empire might inaugurate.
+
+The course of empire upon which the United States has embarked involves
+a complete departure from all of the most cherished traditions of the
+American people. Economic, political and social theories must all be
+thrust aside. Liberty, equality and fraternity must all be forgotten and
+in their places must be erected new standards of imperial purpose that
+are acceptable to the economic and political masters of present day
+American life.
+
+The American people have been taught the language of liberty. They
+believe in freedom for self-determination. Their own government was born
+as a protest against imperial tyranny and they glory in its origin and
+speak proudly of its revolutionary background. Americans are still
+individualists. Their lives and thoughts both have been
+provincial--perhaps somewhat narrow. They profess the doctrine "Live and
+let live" and in a large measure they are willing and anxious to
+practice it.
+
+How is it possible to harmonize the Declaration of Independence with the
+subjugation of peoples and the conquest of territory? If governments
+"derive their just powers from the consent of the governed," and if it
+is the right of a people to alter or to abolish any government which
+does not insure their safety and happiness, then manifestly subjugation
+and conquest are impossible.
+
+The letter and the spirit of the Declaration of Independence contradict
+the letter and spirit of imperial purpose word for word and line for
+line. There can be no harmony between these two theories of social life.
+
+
+6. _Advertising Imperialism_
+
+Since the tradition of the people of the United States and the
+necessities of imperialism are so utterly at variance, it becomes
+necessary to convince the American people that they should abandon
+their traditions and accept a new order of society, under which the will
+to power shall be substituted for liberty and fraternity. The ruling
+class of imperial Germany did this frankly and in so many words. The
+English speaking world is more adroit.
+
+The first step in the campaign to advertise and justify imperialism is
+the teaching of a blind my-country-right-or-wrong patriotism. In the
+days preceding the war the idea was expressed in the phrase, "Stand
+behind the President." The object of this teaching is to instill in the
+minds of the people, and particularly of the young, the principles of
+"Deutschland über alles," which, in translation, means "America first."
+There are more than twenty million children in the public schools of the
+United States who are receiving daily lessons in this first principle of
+popular support for imperial policy.
+
+Having taken this first step and made the state supreme over the
+individual will and conscience, the imperial class makes its next
+move--for "national defense." The country is made to appear in constant
+danger from attack. Men are urged to protect their homes and their
+families. They are persuaded that the white dove of peace cannot rest
+securely on anything less than a great navy and army large enough to
+hold off aggressors. The same forces that are most eager to preach
+patriotism are the most anxious about national preparedness.
+
+Meanwhile the plain people are taught to regard themselves and their
+civilization as superior to anything else on earth. Those who have a
+different language or a different color are referred to as "inferior
+peoples." The people of Panama cannot dig a canal, the people of Cuba
+cannot drive out yellow fever, the people of the Philippines cannot run
+a successful educational system, but the people of the United States can
+do all of these things,--therefore they are justified in interfering in
+the internal affairs of Panama, Cuba and the Philippines. When there is
+a threat of trouble with Mexico, the papers refer to "cleaning up
+Mexico" very much as a mother might refer to cleaning up a dirty child.
+
+Patriotism, preparedness and a sense of general superiority lead to
+that type of international snobbery that says, "Our flag is on the seven
+seas"; or "The sun never sets on our possessions"; or "Our navy can lick
+anything on earth." The preliminary work of "Education" has now been
+done; the way has been prepared.
+
+One more step must be taken, and the process of imperializing public
+opinion is complete. The people are told that the imperialism to which
+they have been called is the work of "manifest destiny."
+
+
+7. _Manifest Destiny_
+
+The argument of "manifest destiny" is employed by the strong as a
+blanket justification for acts of aggression against the weak. Each time
+that the United States has come face to face with the necessity of
+adding to its territory at the expense of some weak neighbor, the
+advocates of expansion have plied this argument with vigor and with
+uniform success.
+
+The American nation began its work of territorial expansion with the
+purchase of Louisiana. Jefferson, who had been elected on a platform of
+strict construction of the Constitution, hesitated at an act which he
+regarded as "beyond the Constitution." (Jefferson's "Works," Vol. IV, p.
+198.) Quite different was the language of his more imperialistic
+contemporaries. Gouverneur Morris said, "France will not sell this
+territory. If we want it, we must adopt the Spartan policy and obtain it
+by steel, not by gold."[51] During February, 1803, the United States
+Senate debated the closing of the Mississippi to American commerce. "To
+the free navigation of the Mississippi we had an undoubted right from
+nature and from the position of the Western country,"[52] said Senator
+Ross (Pennsylvania) on February 14. On February 23rd Senator White
+(Delaware) went a step farther: "You had as well pretend to dam up the
+mouth of the Mississippi, and say to the restless waves, 'Ye shall cease
+here, and never mingle with the ocean,' as to expect they (the settlers)
+will be prevented from descending it."[53] On the same day (February
+23rd) Senator Jackson (Georgia) said: "God and nature have destined New
+Orleans and the Floridas to belong to this great and rising Empire."[54]
+
+God, nature and the requirements of American commerce were the arguments
+used to justify the purchase, or if necessary, the seizure of New
+Orleans. The precedent has been followed and the same arguments
+presented all through the century that followed the momentous decision
+to extend the territory of the United States.
+
+Some reference has been made to the Mexican War and the argument that
+the Southwest was a "natural" part of the territory of the United
+States. The same argument was made in regard to Cuba and by the same
+spokesmen of the slave-power. Stephen A. Douglas (New Orleans, December
+13, 1858) was asked:
+
+"How about Cuba?"
+
+"It is our destiny to have Cuba," he answered, "and you can't prevent it
+if you try."[55]
+
+On another occasion (New York, December, 1858) Douglas stated the matter
+even more broadly:
+
+"This is a young, vigorous and growing nation and must obey the law of
+increase, must multiply and as fast as we multiply we must expand. You
+can't resist the law if you try. He is foolish who puts himself in the
+way of American destiny."[56]
+
+President McKinley stated that the Philippines, like Cuba and Porto
+Rico, "were intrusted to our hands by the Providence of God" (Boston,
+February 16, 1899), and one of his fellow imperialists--Senator
+Beveridge of Indiana--carried the argument one step farther (January 9,
+1900) when he said in the Senate (_Congressional Record_, January 9,
+1900, p. 704): "The Philippines are ours forever.... And just beyond the
+Philippines are China's illimitable markets. We will not retreat from
+either. We will not repudiate our duty to the archipelago. We will not
+abandon our opportunity in the Orient. We will not renounce our part in
+the mission of our race, trustee, under God, of the civilization of the
+world."
+
+Manifest destiny is now urged to justify further acts of aggression by
+the United States against her weaker neighbors. _The Chicago Tribune_,
+discussing the Panama Canal and its implications, says editorially (May
+5, 1916): "The Panama Canal has gone a long way towards making our shore
+continuous and the intervals must and will be filled up; not necessarily
+by conquest or even formal annexation, but by a decisive control in one
+form or another."
+
+Here the argument of manifest destiny is backed by the argument of
+"military necessity,"--the argument that led Great Britain to possess
+herself of Gibraltar, Suez and a score of other strategic points all
+round the earth, and to maintain, at a ruinous cost, a huge navy; the
+argument that led Napoleon across Europe in his march of bloody, fatal
+triumph; the argument that led Germany through Belgium in 1914--one of
+the weakest and yet one of the most seductive and compelling arguments
+that falls from the tongue of man. Because we have a western and an
+eastern front, we must have the Panama Canal. Because we have the Panama
+Canal, we must dominate Central America. The next step is equally plain;
+because we dominate Central America and the Panama Canal, there must be
+a land route straight through to the Canal. In the present state of
+Mexican unrest, that is impossible, and therefore we must dominate
+Mexico.
+
+The argument was stated with persuasive power by ex-Senator Albert J.
+Beveridge (_Collier's Weekly_, May 19, 1917). "Thus in halting fashion
+but nevertheless surely, the chain of power and influence is being
+forged about the Gulf. To neglect Mexico is to throw away not only one
+link but a large part of that chain without which the value and
+usefulness of the remainder are greatly diminished if indeed not
+rendered negligible." By a similar train of logic, the entire American
+continent, from Cape Horn to Bering Sea can and will be brought under
+the dominion of the United States.
+
+Some destiny must call, some imperative necessity must beckon, some
+divine authority must be invoked. The campaign for "100 percent
+Americanism," carefully thought out, generously financed and carried to
+every nook and corner of the United States aims to prove this necessity.
+The war waged by the Department of Justice and by other public officers
+against the "Reds" is intended to arouse in the American people a sense
+of the present danger of impending calamity. The divine sanction was
+expressed by President Wilson in his address to the Senate on July 10,
+1919. The President discussed the Peace Treaty in some of its aspects
+and then said, "It is thus that a new responsibility has come to this
+great nation that we honor and that we would all wish to lift to yet
+higher service and achievement. The stage is set, the destiny disclosed.
+It has come about by no plan of our conceiving but by the hand of God
+who has led us into this war. We cannot turn back. We can only go
+forward, with lifted and freshened spirit to follow the vision."
+
+
+8. _The Open Road_
+
+The American people took a long step forward on November 2, 1920. The
+era of modern imperialism, begun in 1896 by the election of McKinley,
+found its expression in the annexation of Hawaii; the conquest of Cuba
+and the Philippines; the seizure of Panama, and a rapid commercial and
+financial expansion into Latin America. In 1912 the Republicans were
+divided. The more conservative elements backed Taft for reëlection. The
+more aggressive group (notably United States Steel) supported
+Roosevelt. Between them they divided the Republican strength, and while
+they polled a total vote of 7,604,463 as compared with Wilson's
+6,293,910, the Republican split enabled Wilson to secure a plurality of
+2,173,512, although he had less than half of the total vote.
+
+President Wilson entered office with the ideals of "The New Freedom." He
+was out to back the "man on the make," the small tradesman and
+manufacturer; the small farmer; the worker, ambitious to rise into the
+ranks of business or professional life. With the support, primarily, of
+little business, Wilson managed to hold his own for four years, and at
+the 1916 election to poll a plurality, over the Republican Party, of
+more than half a million votes. He won, however, primarily because "he
+kept us out of war." April, 1917, deprived him of that argument. His
+"New Freedom" doctrines, translated into international politics (in the
+Fourteen Points) were roughly handled in Paris. The country rejected his
+leadership in the decisive Congressional elections of 1918, and he and
+his party went out of power in the avalanche of 1920, when Harding
+received a plurality nearly three times as great as the highest one ever
+before given a presidential candidate (Roosevelt, in 1904). Every state
+north of the Mason and Dixon Line went Republican. Tennessee left the
+Solid South and joined the same party. The Democrats carried only eleven
+states--the traditional Democratic stronghold.
+
+The victory of Harding is a victory for organized, imperial, American
+business. The "man on the make" is brushed aside. In his place stands
+banker, manufacturer and trader, ready to carry American money and
+American products into Latin America and Asia.
+
+Before the United States lies the open road of imperialism. Manifest
+destiny points the way in gestures that cannot be mistaken. Capitalist
+society in the United States has evolved to a place where it must make
+certain pressing demands upon neighboring communities. Surplus is to be
+invested; investments are to be protected, American authority is to be
+respected. All of these necessities imply the exercise of imperial power
+by the government of the United States.
+
+Capitalism makes these demands upon the rulers of capitalist society.
+There is no gainsaying them. A refusal to comply with them means death.
+
+Therefore the American nation, under the urge of economic necessity;
+guided half-intelligently, half-instinctively by the plutocracy, is
+moving along the imperial highroad, and woe to the man that steps across
+the path that leads to their fulfillment. He who seeks to thwart
+imperial destiny will be branded as traitor to his country and as
+blasphemer against God.
+
+FOOTNOTES:
+
+[48] "New American History," A. B. Hart. American Book Co., 1917, p.
+348.
+
+[49] The total area of these countries, exclusive of their colonies, is
+807,123 square miles.
+
+[50] See "Theory of the Leisure Class," Thorstein Veblen. New York,
+Huebsch, 1918, Ch. 10.
+
+[51] "A History of Missouri," Louis Houck. Chicago, R. R. Donnelly &
+Sons, 1908, vol. II, p. 346.
+
+[52] "History of Louisiana," Charles Gayarre. New Orleans, Hansell &
+Bros., Ltd., 1903, vol. III, p. 478.
+
+[53] Ibid., p. 485.
+
+[54] Ibid., p. 486.
+
+[55] McMaster's "History of the American People." Vol. VIII, p. 339.
+
+[56] Ibid., p. 339.
+
+
+
+
+XIII. THE UNITED STATES AS A WORLD COMPETITOR
+
+
+1. _A New World Power_
+
+Youngest among the great nations, the United States holds a position of
+immense world power. Measured in years and compared with her sister
+nations in Europe and Asia, she is a babe. Measured in economic strength
+she is a burly giant. Young America is, but mighty with a vast economic
+strength.
+
+An inexorable destiny seems to be forcing the United States into a
+position of international importance. Up to the time of the Spanish War,
+she played only a minor part in the affairs of the world. The Spanish
+War was the turning point--the United States as a borrowing nation gave
+way then, to the United States as an investing nation. Economic forces
+compelled the masters of economic life to look outside of the country
+for some of their business opportunities.
+
+Since the Civil War the United States has been preparing herself for her
+part in world affairs. During the thirty years that elapsed between 1870
+and 1900 she emerged from a position of comparative economic inferiority
+to take a position of notable economic importance. Between the years
+1870 and 1900 the population of the United States increased 97 per cent.
+During the same period the annual production of wheat increased from 236
+million bushels to 522 million bushels; the annual production of corn
+from 1,094 to 2,105 million bushels; the annual production of cotton
+from 4,352 to 10,102 thousand bales; the annual production of coal from
+29 to 241 million tons; the annual production of petroleum from 221 to
+2,672 million gallons; the annual production of pig iron from 1,665 to
+13,789 thousand tons; the annual production of steel from 68 to 10,188
+thousand tons; the annual production of copper from 12 to 271 thousand
+tons, and the production of cement (there is no record for 1870) rose
+from two million barrels in 1880 to 17 million barrels in 1900. Thus
+while the production of food more than kept pace with the increase of
+population, the production of those commodities upon which the new
+industry depends--coal, petroleum, iron, steel, copper and
+cement--increased many times more rapidly than the population. During
+one brief generation the United States, with almost unbelievable
+rapidity, forged ahead in the essentials for supremacy in the new world
+of industry.
+
+By the time of the Spanish War (1898) American industries had found
+their stride. During the next fourteen years they were overtaking their
+European competitors in seven league boots. Between 1900 and 1914 while
+the population of the United States increased by 30 per cent,--
+
+
+     Wheat production increased       70 per cent
+     Corn production increased        27  "   "
+     Cotton production increased      58  "   "
+     Coal production increased        90  "   "
+     Petroleum production increased  317  "   "
+     Pig Iron production increased    69  "   "
+     Steel production increased      131  "   "
+     Copper production increased      89  "   "
+     Cement production increased     406  "   "
+
+
+The United States was rushing toward a position of economic world power
+before the catastrophe of 1914 hurled her to the front, first as a
+producer (at immense profits) for the Allies, and later as the financier
+of the final stages of the War.
+
+The economic position that is now held by the United States among the
+great competing nations of the world can be in some measure
+suggested--it cannot be adequately stated--by a comparison of the
+economic position of the United States and some of the other leading
+world empires.
+
+Neither the geographical area of the United States nor the numerical
+importance of its people justifies its present world position. The
+country, with 8 per cent of the area and 6 per cent of the population of
+the world, looms large in the world's economic affairs,--how large will
+appear from an examination of certain features that are considered
+essential to economic success, such as resources, capital, products,
+shipping, and national wealth and income.
+
+
+2. _The Resources of the United States_
+
+The most important resource of any country is the fertile, agricultural
+land. Figures given in the Department of Agriculture Year Book for 1918
+(Table 319) show the amount of productive land,--including, beside
+cultivated land, natural meadows, pastures, forests, woodlots, etc., of
+the various countries according to pre-war boundary lines. The total of
+such productive land for the 36 leading countries of the world was
+4,591.7 million acres. Russia, including Siberia, had almost a third of
+this total (1,414.7 million acres). The United States came second with
+878.8 million acres, or 19 per cent of the total available productive
+land. Third in the list was Argentine with 537.8 million acres. British
+India came fourth with 465.7 million acres. Then there followed in order
+Austria-Hungary, Germany, France, Australia, Spain and Japan.
+Austria-Hungary, Germany and France combined had almost exactly four
+hundred million acres of productive land or less than half the
+productive area of the United States.
+
+The United States, in the area of productive land, is second only to
+Russia. In the area of land actually under cultivation, however, it
+stands first, with Russia a close second and British India a close
+third,--the amounts of cultivated land in each of these countries being
+293.8 million acres, 279.6 million acres, and 264.9 million acres
+respectively. These three countries together contain 64 per cent of the
+1,313.8 million acres of cultivated land of the world. The United States
+alone contains 22 per cent of the total cultivated land.
+
+The total forest acreage available for commercial purposes is greatest
+in Russia (728.4 million acres). The United States stands second with
+400 million acres and Canada third with 341 million acres. The Chief of
+Forest Investigations of the United States Department of Agriculture
+(Letter of Oct. 11, 1919) places the total forest acreage of both Brazil
+and Canada ahead of the United States. In the case of Brazil no figures
+are available showing what portion of the 988 million acres of total
+area is commercially available. Canada with a total forest acreage of
+800 million acres has less timber commercially available than the United
+States with a total forest area of 500 million acres.
+
+The iron ore reserves of the world are estimated at 91,000 million tons
+("Iron Ores," Edwin C. Eckel. McGraw Hill Book Co., 1914, pp. 392-3). Of
+this amount 51,000 millions are placed in Asia and Africa; 12,000
+million tons in Europe, and 14,800 million tons in North America. The
+United States alone is credited with 4,260 million tons or about 5 per
+cent of the world's supply. The United States Geological Survey
+(_Bulletin_ 666v) estimates the supply of the United States at 7,550
+million tons; the supply in Newfoundland, Mexico and Cuba as 7,000
+million tons, and that in South America as 8,000 million tons as against
+12,000 million tons for Europe. This estimate would give the United
+States alone 8 per cent of the iron ore of the world. It would give
+North America 15 per cent and the Western Hemisphere 25 per cent, as
+against 15 per cent for Europe.
+
+Iron ore furnishes the material out of which industrial civilization is
+constructed. Until recently the source of industrial power has been
+coal. Even to-day petroleum and water play a relatively unimportant
+rôle. Coal still holds the field.
+
+The United States alone contains 3,838,657 million tons--more than half
+of the total coal reserves of the world. ("Coal Resources of the World."
+Compiled by the Executive Committee, International Geological Congress,
+1913, Vol. I, p. XVIII ff.) North America is credited with 5,073,431
+million tons or over two-thirds of the world's total coal reserves
+(7,397,553 millions of tons). The coal reserve of Europe is 784,190
+million tons or about one-fifth of the coal reserves of the United
+States alone.
+
+Figures showing the amount of productive land and of timber may be
+verified. Those dealing with iron ore and coal in the ground are mere
+estimates and should be treated as such. At the same time they give a
+rough idea of the economic situation. Of all the essential
+resources,--land, timber, iron, copper, coal, petroleum and
+water-power,--the United States has large supplies. As compared with
+Europe, her supply of most of them is enormous. No other single country
+(the British Empire is not a single country) that is now competing for
+the supremacy of the world can compare with the United States in this
+regard, and if North America be taken as the unit of discussion, its
+preponderance is enormous.
+
+
+3. _The Capital of the United States_
+
+The United States apparently enjoys a large superiority over any single
+country in its reserves of some of the most essential resources. The
+same thing is true of productive machinery.
+
+Figures showing the actual quantities of capital are available in only a
+small number of cases. Estimates of capital value in terms of money are
+useless. It is only the figures which show numbers of machines that
+really give a basis for judging actual differences.
+
+Live stock on farms, the chief form of agricultural capital, is reported
+for the various countries in the Year Book of the United States
+Department of Agriculture. The United States (1916) heads the list with
+61.9 million cattle; 67.8 million hogs; 48.6 million sheep and goats,
+and 25.8 million horses and mules,--204 million farm animals in all. The
+Russian Empire (including Russia in Asia) is second (1914) with 52.0
+million cattle; 15.0 hogs; 72.0 million sheep and goats, and 34.9
+horses and mules,--174 million farm animals in all. British India (1914)
+reports more cattle than any other country (140.5 million); she is also
+second in the number of sheep and goats with 64.7 millions, but she has
+no hogs and 1.9 million horses. Argentina (1914) reports 29.5 million
+cattle; 2.9 million sheep and goats; and 8.9 million horses and mules.
+The number of animals on European farms outside of Russia is
+comparatively small. Germany (1914), United Kingdom (1916),
+Austria-Hungary (1913), and France (1916) reported 61.8 million cattle,
+46.6 million hogs, 60.8 million sheep and goats, and 11.5 million horses
+and mules, making a total of 180.7 million farm animals. These four
+countries with a population of about 206 million persons, had less live
+stock than the United States with its population (1916) of about 100
+millions.
+
+It would be interesting to compare the amount of farm machinery and farm
+equipment of the United States with that of other countries.
+Unfortunately no such figures are available.
+
+The figures showing transportation capital are fairly complete.
+(_Statistical Abstr._ 1918, pp. 844-5.) The total railroad mileage of
+the world is 729,845. More than one-third of this mileage (266,381
+miles) is in the United States. Russia (1916) comes second with 48,950
+miles; Germany (1914) third, with 38,600 miles and Canada (1916) fourth
+with 37,437 miles.
+
+The world's total mileage of telegraph wire (Ibid.) is 5,816,219, of
+which the United States has more than a fourth (1,627,342 miles). Russia
+(1916) is second with 537,208 miles; Germany (1914) is third with
+475,551 miles; and France fourth with 452,192 miles.
+
+The Bureau of Railway Economics has published a compilation on
+"Comparative Railway Statistics" (_Bulletin 100_, Washington, 1916) from
+which it appears that the United States is far ahead of any other
+country in its railroad equipment. The total number of locomotives in
+the United States was 64,760; in Germany 29,520; in United Kingdom
+24,718; in Russia (1910) 19,984; and in France 13,828. No other country
+in the world had as many as ten thousand locomotives. If these figures
+also showed the locomotive tonnage as well as the number, the lead of
+the United States would be even more decided as the European locomotives
+are generally smaller than those used in the United States. This fact is
+clearly brought out by the figures from the same bulletin showing
+freight car tonnage (total carrying capacity of all cars). For the
+United States the tonnage was (1913) 86,978,145. The tonnage of Germany
+was 10.7 millions; of France 5.0 millions; of Austria-Hungary 3.8
+millions. The figures for the United Kingdom were not available.
+
+The United States also takes the lead in postal equipment. (_Stat.
+Abstr._, 1918, pp. 844-5.) There are 324,869 post offices in the world;
+54,257 or one-sixth in the United States. The postal routes of the world
+cover 2,513,997 miles, of which 450,954 miles are in the United States.
+The total miles of mail service for the world is 2,061 millions. Of this
+number the United States has 601.3 millions.
+
+The most extreme contrast between transportation capital in the United
+States and foreign countries is furnished by the number of automobiles.
+_Facts and Figures_, the official organ of the National Automobile
+Chamber of Commerce (April, 1919) estimates the total number of cars in
+use on January 1, 1917 as 4,219,246. Of this number almost six-sevenths
+(3,500,000) were in use in the United States. The total number of cars
+in Europe as estimated by the Fiat Press Bureau, Italy, was 437,558, or
+less than one-seventh of the number in use in the United States.
+Automobile distribution is of peculiar significance because the industry
+has developed almost entirely since the Spanish-American War and
+therefore since the time when the United States first began to develop
+into a world power.
+
+The world's cotton spindleage in 1919 is estimated at 149.4 million
+spindles. (Letter from T. H. Price 10/6/19.) Of this total Great Britain
+has 57.0 millions; the United States 33.7 millions; Germany 11.0
+millions; Russia 8.0 millions, and France and India each 7.0 millions.
+
+No effort has been made to cite figures showing the estimated value of
+various forms of capital, because of the necessary variations in value
+standards. Enough material showing actual quantities of capital has been
+presented to prove that in agriculture, in transportation, in certain
+lines of manufacturing the United States is either at the head of the
+list, or else stands in second place. In transportation capital
+(particularly automobiles) the lead of the United States is very great.
+
+If figures were available to show the relative amounts of capital used
+in mining, in merchandising, and in financial transactions they would
+probably show an equally great advantage in favor of the United States.
+In this connection it might not be irrelevant to note that in 1915 the
+total stock of gold money in the world was 8,258 millions of dollars.
+More than a quarter (2,299 millions) was in the United States. The total
+stock of silver money was 2,441 millions of dollars of which 756
+millions (nearly a third) was in the United States. (_Stat. Abstr._,
+1918, pp. 840-1.)
+
+
+4. _Products of the United States_
+
+Figures showing the amounts of the principal commodities produced in the
+United States are far more complete than those covering the resources
+and capital. They are perhaps the best index of the present economic
+position of the United States in relation to the other countries of the
+world.
+
+The wheat crop of the world in 1916 was 3,701.3 million bushels. Russia,
+including Siberia, was the leading producer with 686.3 million bushels.
+The United States was second with 636.7 million bushels or 17 per cent
+of the world's output. British India, the third wheat producer, had a
+crop in 1916 of 323.0 million bushels. Canada, with 262.8 million
+bushels, was fourth on the list. Thus Canada and the United States
+combined produced almost exactly one-fourth of the world's wheat crop.
+
+As a producer of corn the United States is without a peer. The world's
+corn crop in 1916 was 3,642.1 million bushels. Two-thirds of this crop
+(2,566.9 million bushels) was produced in the United States.
+
+The position of the United States as a producer of corn is almost
+duplicated in the case of cotton. The _Statistical Abstract_ published
+by the British Government (No. 39, London, 1914, p. 522) gives the
+world's cotton production as 21,659,000 bales (1912). Of this number the
+United States produced 14,313,000--almost exactly two-thirds. British
+India, which ranks second, reported a production of 3,203,000 bales.
+Egypt was third with 1,471,000 bales.
+
+About one-tenth of the world's output of wool is produced in the United
+States. World production for 1917 is placed at 2,790,000 pounds.
+(_Bulletin_, National Association of Wool Manufacturers. 1918, p. 162.)
+Australia heads the list with a production of 741.8 million pounds.
+Russia, including Siberia, comes second with 380.0 million pounds. The
+United States is third with 285.6 million pounds and Argentina fourth
+with 258.3 million pounds.
+
+The United States leads the world in timber production. "Last winter we
+estimated that the United States has been cutting about 50 per cent of
+the total world's supply of lumber." (Letter from Chief of Forest
+Investigation. U. S. Forest Service. Oct. 11, 1919.) The same letter
+gives the present annual timber cut. The United States 12.5 billion
+cubic feet; Russia 7.1 billion cubic feet; Canada 3.0 billion cubic
+feet; Austria-Hungary 2.7 billion cubic feet.
+
+A third of the iron ore produced in the world in 1912 came from the
+United States. The world's production in that year was 154.0 million
+tons (_British Statistical Abstract_, No. 39, p. 492). The United States
+produced 56.1 million tons or 36 per cent of the whole; Germany produced
+32.7 million tons; France 19.2 million tons; the United Kingdom 14.0
+million tons. No other country is reported as producing as much as ten
+million tons.
+
+The position of the United States as a producer of iron and steel was
+greatly enhanced by the war. _The Daily Consular and Trade Reports_
+(July 9, 1919, p. 155) give a comparison between the world's steel and
+iron output in 1914 and 1918. In 1914 the United States produced 23.3
+million tons of pig iron; Germany produced 14.4 million tons; the United
+Kingdom 8.9 million tons, and France 5.2 million tons. The United States
+was thus producing 45 per cent of the pig iron turned out in these four
+countries. For 1918 the pig iron production of the United States was
+39.1 million tons. That of the other three countries was 22.0 million
+tons. In that year the United States produced 64 per cent of the pig
+iron product of these four countries. An equally great lead is shown in
+the case of steel production. In 1914 the United States produced 23.5
+million tons of steel. Germany, the United Kingdom and France produced
+27.6 million tons. By 1918 the production of the United States had
+nearly doubled (45.1 million tons).
+
+The total pig iron output of the world for 1917 was placed at 66.9
+millions of tons. The world's production of steel in 1916 was placed at
+83 million tons. The United States produced considerably more than half
+of both commodities. ("The Mineral Industry During 1918." New York,
+McGraw Hill Book Co., 1919, pp. 379-80).
+
+The two chief forms of power upon which modern industry depends are
+petroleum and coal. The United States is the largest producer of both of
+these commodities. The world's production of petroleum in 1917 was 506.7
+million barrels (_Mineral Resources_, 1917, Part II, p. 867). Of this
+amount the United States produced 335.3 million barrels or 66 per cent
+of the total. The second largest producer, Russia, and the third,
+Mexico, are credited with 69 million barrels and 55.3 million barrels
+respectively.
+
+As a coal producer the United States stands far ahead of all other
+nations. The United States Geological Survey (_Special Report_, No. 118)
+placed the total coal production of the world in 1913 at 1,478 million
+tons. Of this amount 569.9 million tons (38.5 per cent) were produced in
+the United States. The production for Great Britain was 321.7 million
+tons; for Germany 305.7 million tons; for Austria-Hungary 60.6 million
+tons. No other country reported a production of as much as fifty million
+tons. In 1915 the United States produced 40.5 per cent of the world's
+coal; in 1917 44.2 per cent; in 1918 46.2 per cent.
+
+Copper has become one of the world's chief metals. Two-thirds of all the
+copper is produced in the United States. Copper production in 1916
+totaled 3,107 million pounds (_Mineral Resources in the United States_,
+1916, part I, p. 625). The production for the United States was 1,927.9
+million pounds (62 per cent of the whole). The second largest producer,
+Japan, turned out 179.2 million pounds.
+
+The precious metals, gold and silver, are largely produced in the United
+States. The world's gold production for 1917 was 423.6 million dollars
+(_Mineral Resources_, 1917, p. 613). Africa produced half of this amount
+(214.6 million dollars). The United States was second with a production
+of 83.8 million dollars (20 per cent of the whole). The same publication
+(p. 615) gives the world's silver production in 1917 as 164 million
+ounces. 77.1 million ounces (43 per cent) were produced in the United
+States. The second largest producer was Mexico, 31.2 million ounces; and
+the third Canada, with 22.3 million ounces. These three North American
+countries produced 76 per cent of the world's output of silver.
+
+Judge Gary, speaking at the Annual Meeting of the Iron and Steel
+Institute (1920) put the situation in this summary form:--
+
+As frequently stated, notwithstanding the United States has only 6% of
+the world's population and 7% of the world's land, yet we produce:
+
+
+     20% of the world's supply of gold,
+     25% of the world's supply of wheat,
+     40% of the world's supply of iron and steel,
+     40% of the world's supply of lead,
+     40% of the world's supply of silver,
+     50% of the world's supply of zinc,
+     52% of the world's supply of coal,
+     60% of the world's supply of aluminum,
+     60% of the world's supply of copper,
+     60% of the world's supply of cotton,
+     66% of the world's supply of oil,
+     75% of the world's supply of corn,
+     85% of the world's supply of automobiles.
+
+
+With the exception of rubber, practically all of the essential raw
+materials and food products upon which modern industrial society depends
+are produced largely in the United States. With less than a sixteenth of
+the world's population, the United States produced from a fifth to
+two-thirds of most of the world's essential products.
+
+
+5. _Shipping_
+
+The rapid increase in the foreign trade of the United States created a
+demand for American shipping facilities. Before the Civil War the United
+States held a place as a maritime nation. Between the Civil War and the
+war with Spain the energies of the American people were devoted to
+internal improvement. With the advent of expansion that followed the
+Spanish-American War, came an insistent demand that the United States
+develop a merchant marine adequate to carry its own foreign trade.
+
+The United States Commissioner of Navigation in his report for 1917 (p.
+78) gives the net gross tonnage of steam and sailing vessels in 1914 as
+45 million tons in all. The tonnage of Great Britain was 19.8 million
+tons; of Germany 4.9 million tons; of the United States 3.5 million
+tons; of Norway 2.4 million tons; of France 2.2 million tons; of Japan
+1.7 million tons, and of Italy 1.6 million tons.
+
+The war brought about great changes in the distribution of the world's
+shipping. Germany was practically eliminated as a shipping nation. The
+necessity of recouping the submarine losses, and of transporting troops
+and supplies led the United States to adopt a ship-building program
+that made her the second maritime country of the world. Lloyd's Register
+of Shipping gives the steam tonnage of the United Kingdom as 18,111,000
+gross tons in June, 1920. For the same month the tonnage of the United
+States is given as 12,406,000 gross tons. Japan comes next with a
+tonnage of 2,996,000 gross tons. According to the same authority the
+United Kingdom had 41.6 per cent of the world's tonnage in 1914 and 33.6
+per cent in 1920; while the United States had 4.7 per cent of the
+world's tonnage in 1914 and 24 per cent in 1920.
+
+
+6. _Wealth and Income_
+
+The economic advantages of the United States enumerated in this chapter
+inevitably are reflected in the figures of national wealth and national
+income. While these figures are estimates rather than conclusive
+statements they are, nevertheless, indicative of a general situation.
+
+During the war a number of attempts were made to approximate the pre-war
+wealth and income of the leading nations. Perhaps the most ambitious of
+these efforts was contained in a paper on "Wealth and Income of the
+Chief Powers" read before the Royal Statistical Society. (See _The
+London Economist_, May 24, 1919, pp. 958-9.) This and other estimates
+were compiled by L. R. Gottlieb and printed in the _Quarterly Journal of
+Economics_ for Nov. 1919. Mr. Gottlieb estimates the pre-war national
+wealth of Great Britain, France, Italy, Japan, Russia, Belgium, Germany,
+Austria-Hungary, Turkey and Bulgaria at 366,100 million dollars. At the
+same time the wealth of the United States was estimated at 204,400
+million dollars. Thus the wealth of the United States was equal to about
+36 per cent of the total wealth of the great nations in question.
+
+The same article contains an estimate of pre-war national incomes for
+these great powers. The total is placed at 81,100 million dollars. The
+income for the United States is placed at 35,300 million dollars, or
+more than 43 per cent of the total.
+
+The war has made important changes in the wealth and income of the
+principal powers. The wealth and income of Europe have been reduced,
+while the wealth and income of the United States have been greatly
+increased. This increase is rendered doubly emphatic by the
+demoralization in foreign exchange which gives the American dollar a
+position of unique authority in the financial world.
+
+The latest wealth estimates (_Commerce and Finance_, May 26, and July
+28, 1920) in terms of dollars at their purchasing-power value, makes the
+wealth of the whole British Empire 230 billions of dollars; of France,
+100 billions; of Russia, 60 billions; of Italy, 40 billions; of Japan,
+40 billions; of Germany, 20 billions, and of the United States, 500
+billions. These figures are subject to alteration with the alteration of
+the exchange rates, but they indicate the immense advantage that is
+possessed by the business men of the United States over the business men
+of any or of all of the other nations of the world.
+
+Before the war, the British were the chief lenders in the international
+field. In 1913 Great Britain had about 20 billions of dollars of foreign
+investments, as compared with 9 billions for France and about 6 billions
+for Germany. At the end of 1920, the British foreign investments had
+shrunk to a fraction of their former amount, while the United States,
+from the position of a debtor nation, had become the leading investing
+nation of the world, with over 9 billions of dollars loaned to the
+Allied governments; with notice loans estimated at over 10 billions;
+with foreign investments of 8 billions, and goods on consignment to the
+extent of 2 billions.
+
+The United States therefore began the year 1921 with a greater financial
+lead, by several times over, than that which she held before the war,
+when she was credited with a greater wealth and a larger income than
+that of any other nation in the world. The extent of the advantage
+enjoyed by the United States at the end of 1920 cannot be stated with
+any final accuracy, but its proportions are staggering.
+
+
+7. _The Economic Position of the United States_
+
+Economically the United States is a world power. She occupies one of the
+three great geographical areas in the temperate zone. If she were to
+include Canada, Mexico and Central America--the territory north of the
+Canal Zone--she would have the greatest unified body of economic
+advantage anywhere in the world.
+
+The United States is rich in practically all of the important industrial
+resources. She has a large, relatively homogeneous population, a great
+part of which is directly descended from the conquering races of the
+world. Almost all of the essential raw materials are produced in the
+United States, and in relatively large quantities. The period since the
+Spanish War has witnessed a rapid increase in wealth production. The war
+of 1914 resulted in an even greater increase in shipping. The investable
+surplus is greater in the United States than in any other nation, and in
+amount as well as in percent the national debt is less than that in any
+other important nation except Japan. Economically the position of the
+United States is unique. The masters of her industries hold a position
+of great advantage in the capitalist world.
+
+
+
+
+XIV. THE PARTITION OF THE EARTH
+
+
+1. _Economic Power and Political Authority_
+
+Economically the United States is a world power. Her world position in
+politics follows as a matter of course.
+
+While the American people were busy with internal development, they
+played an unimportant part in world affairs. They were not competing for
+world trade, because they had relatively little to export; they were not
+building a merchant marine because of the smallness of their trading
+activities; they were not engaged in the scramble after undeveloped
+countries because, with an undeveloped country of their own, calling
+continually for enlarged investments, they had little surplus capital to
+employ in foreign enterprises.
+
+This economic isolation of the United States was reflected in an equally
+thoroughgoing political isolation. With the exception of the Monroe
+Doctrine, which in its original form was intended as a measure of
+defense against foreign political and military aggression, the United
+States minded its own affairs, and allowed the remainder of the world to
+go its way. From time to time, as necessity arose, additional territory
+was purchased or taken from neighboring countries--but all of these
+transactions, up to the annexation of Hawaii (1898) were confined to the
+continent of North America, in which no European nation, with the
+exception of Great Britain, had any imperative territorial interest.
+
+The economic changes which immediately preceded the Spanish War period
+commanded for the United States a place among the nations. The passing
+of economic aloofness marked the passing of political aloofness, and
+the United States entered upon a new era of international relationships.
+Possessed of abundant natural resources, and having through a long
+period of peace developed a large working capital with which these
+resources might be exploited, the United States, at the beginning of the
+twentieth century, was in a position to export, to trade and to invest
+in foreign enterprises.
+
+The advent of the World War gave the United States a dramatic
+opportunity to take a position which she must have assumed in any case
+in a comparatively short time. It had, however, one signal, diplomatic
+advantage,--it enabled the capitalist governments of Europe to accept,
+with an excellent grace, the newly acquired economic prominence of the
+United States and to recognize her without question as one of the
+leading political powers. The loan of ten billions to Europe; the
+sending of two million men at double quick time to the battle front; the
+immense increases in the production of raw material that followed the
+declaration of war by the United States; the thoroughness displayed by
+the American people, once they had decided to enter the war, all played
+their part in the winning of the victory. There were feelings, very
+strongly expressed, that the United States should have come in sooner;
+should have sacrificed more and profiteered less. But once in, there
+could be no question either of the spirit of her armies or of the vast
+economic power behind them.
+
+When it came to dividing the spoils of victory, the United States held,
+not only the purse strings, but the largest surpluses of food and raw
+materials as well. Her diplomacy at the Peace Table was weak. Her
+representatives, inexperienced in such matters, were no match for the
+trained diplomats of Europe, but her economic position was unquestioned,
+as was her right to take her place as one of the "big five."
+
+
+2. _Dividing the Spoils_
+
+The Peace Conference, for purposes of treaty making, separated the
+nations of the world into five classes:
+
+
+     1. The great capitalist nations.
+     2. The lesser capitalist states.
+     3. Enemy nations.
+     4. Undeveloped territories.
+     5. The socialist states.
+
+
+The great capitalist states were five in number--Great Britain, France,
+Italy, Japan and the United States. These five states dominated the
+armistice commission and the Peace Conference and they were expected to
+dominate the League of Nations. The position of these five powers was
+clearly set forth in the regulations governing procedure at the Peace
+Conference. Rule I reads: "The belligerent powers with general
+interests--the United States of America, the British Empire, France,
+Italy and Japan--shall take part in all meetings and commissions." (_New
+York Times_, January 20, 1919.) Under this rule the Big Five were the
+Peace Conference, and throughout the subsequent negotiations they
+continued to act the part.
+
+The same concentration of authority was read into the revised covenant
+of the League of Nations. Article 4 provides that the Executive Council
+of the League "shall consist of the representatives of the United States
+of America, of the British Empire, of France, of Italy and of Japan,
+together with four other members of the League." The authority of the
+Big Five was to be maintained by giving them five votes out of nine on
+the executive council of the League, no matter how many other nations
+might become members.
+
+It was among the Big Five, furthermore, that the spoils of victory were
+divided. The Big Five enjoyed a full meal; the lesser capitalist states
+had the crumbs.
+
+The enemy nations were stripped bare. Their colonies were taken, their
+foreign investments were confiscated, their merchant ships were
+appropriated, they were loaded down with enormous indemnities, they were
+dismembered. In short, they were rendered incapable of future economic
+competition. The thoroughgoing way in which this stripping was
+accomplished is discussed in detail by J. M. Keynes in "The Economic
+Consequences of the Peace" (chapters 4 and 5).
+
+The undeveloped territories--the economic opportunities upon which the
+Big Five were relying for the disposal of their surplus products and
+surplus capital, were carved and handed about as a butcher carves a
+carcass. Shantung, which Germany had taken from China, was turned over
+to Japan under circumstances which made it impossible for China to sign
+the Treaty--thus leaving her territory open for further aggression. The
+Near East was divided between Great Britain, France and Italy. Mexico
+was not invited to sign the treaty and her name was omitted from the
+list of those eligible to join the League. The German possessions in
+Africa and in the Pacific were distributed in the form of "mandates" to
+the Great Powers. The principle underlying this distribution was that
+all of the unexploited territory should go to the capitalist victors for
+exploitation. The proportions of the division had been established,
+previously, in a series of secret treaties that had been entered into
+during the earlier years of the war.
+
+With the Big Five in control, with the lesser capitalist states
+silenced; with the border states made or in the making; with the enemy
+reduced to economic impotence, and the unexploited portions of the world
+assigned for exploitation, the conference was compelled to face still
+another problem--the Socialist Republic of Russia.
+
+Russia, Czar ridden and oppressed, had entered the war as an ally of
+France and Great Britain. Russia, unshackled and attempting
+self-government on an economic basis, was an "enemy of civilization."
+The Allies therefore supported counter-revolution, organized and
+encouraged warfare by the border states, established and maintained a
+blockade, the purpose of which was the starvation of the Russian people
+into submission, and did all that money, munitions, supplies,
+battleships and army divisions could do to destroy the results of the
+Russian Revolution.
+
+The Big Five--assuming to speak for all of the twenty-three nations that
+had declared war on Germany--manipulated the geography of Europe,
+reduced their enemies to penury, disposed of millions of square miles of
+territory and tens of millions of human beings as a gardener disposes of
+his produce, and then turned their united strength to the task of
+crushing the only thing approaching self-government that Russia has had
+for centuries.
+
+A more shameless exhibition of imperial lust is not recorded in history.
+Never before were five nations in a position to sit down at one table
+and decide the political fate of the world. The opportunity was unique,
+and yet the statesmen of the world played the old, savage game of
+imperial aggression and domination.
+
+This brutal policy of dealing with the world and its people was accepted
+by the United States. Throughout the Conference her representatives
+occupied a commanding position; at any time they would have been able to
+speak with a voice of almost conclusive authority; they chose,
+nevertheless, to play their part in this imperial spectacle. To be sure
+the Senate refused to ratify the Treaty,--not because of its imperial
+iniquities, but rather because there was nothing in it for the United
+States.
+
+
+3. _Italy, France and Japan_
+
+The shares of spoil falling to Italy and France as a result of the
+treaty are comparatively small although both countries--and particularly
+France--carried a terrific war burden. Japan, the least active of any of
+the leading participants in the war, received territory of vast
+importance to her future development.
+
+Italy,--under the secret treaty of London, signed April 26, 1915, by
+the representatives of Russia, France, Great Britain and Italy,--was to
+receive that part of Austria known as the Trentine, the entire southern
+Tyrol, the city and suburbs of Trieste, the Istrian Islands and the
+province of Dalmatia with various adjacent islands. Furthermore, Article
+IX of the Treaty stipulated that, in the division of Turkey, Italy
+should be entitled to an equal share in the basin of the Mediterranean,
+and specifically to the province of Adalia. Under Article XIII, "In the
+event of the expansion of French and English colonial domains in Africa
+at the expense of Germany, France and Great Britain recognize in
+principle the Italian right to demand for herself certain compensations
+in the sense of expansions of her lands in Erithria, Somaliland, in
+Lybia and colonial districts lying on the boundary, with the colonies of
+France and England." Substantially, this plan was followed in the Peace
+Treaty.
+
+The territorial claims of France were simple. The secret treaties
+include a note from the French Minister of Foreign Affairs to the French
+Ambassador at Petrograd, dated February 1-14, 1917, which stated that
+under the Peace Treaty:
+
+
+     "(1) Alsace and Lorraine to be returned to France.
+
+     "(2) The boundaries will be extended at least to the limits of the
+     former principality of Lorraine, and will be fixed under the
+     direction of the French Government. At the same time strategic
+     demands must be taken into consideration, so as to include within
+     the French territory the whole of the industrial iron basin of
+     Lorraine and the whole of the industrial coal-basin of the Saar."
+
+
+The Peace Treaty confirmed these provisions, with the exception of the
+Saar Valley, which is to go to France for 15 years under conditions
+which will ultimately cause its annexation to France if she desires it.
+France also gained some slight territorial concessions in Africa. Her
+real advantage--as a result of the peace--lies in the control of the
+three provinces with their valuable mineral deposits.
+
+The territorial ambitions of Japan were confined to the Far East. The
+former Russian Ambassador to Tokio, under date of February 8, 1917,
+makes the statement that Japan was desirous of securing "the succession
+to all the rights and privileges possessed by Germany in the Shantung
+province and for the acquisition of the islands north of the Equator."
+In a secret treaty with Great Britain, Japan secured a guarantee
+covering such a division of the German holdings in the Pacific.
+
+These concessions are of great importance to Japan. By the terms of the
+Treaty one of her rivals for the trade of the East (Germany) is
+eliminated, and the territory of that rival goes to Japan. With the
+control of Port Arthur and Korea and Shantung, Japan holds the gateway
+to the heart of Northern China. The islands gained by Japan as a result
+of the Treaty give her a barrier extending from the Kurile Islands, near
+Kamchatka, through the Empire of Japan proper, to Formosa. Farther out
+in the Pacific, there are the Ladrones, the Carolines and the Pelew
+Islands, which, in combination, make a series of submarine bases that
+render attack by sea difficult or impossible, and that lie,
+incidentally, between the United States and the Philippine Islands.
+Japan came away from the Peace Conference with the key to the East in
+her pocket.
+
+
+4. _The Lion's Share_
+
+The lion's share of the Peace Conference spoil went to Great Britain. To
+each of the other participants, certain concessions, agreed upon
+beforehand, were made. The remainder of the war-spoil was added to the
+British Empire. This "remainder" comprised at least a million and half
+square miles of territory, and included some of the most important
+resources in the world.
+
+The territorial gains of Great Britain cover four areas--the Near East,
+the Far East, Africa, and the South Pacific.
+
+The gains of Great Britain in the Near East include Hedjez and Yemen,
+the control of which gives the British possession of virtually all of
+the territory bordering on the Red Sea. The Persian Gulf is likewise
+placed under British control, through her holding of Mesopotamia and her
+control over Persia and Oman. The eastern end of the Mediterranean is
+held by the British through their control of Palestine.
+
+Thus the gateway to the East,--both by land and by sea, the eastern
+shores of the Mediterranean, the valleys of the Tigris and the Euphrates
+and the basin of the Red Sea all fall into the hands of the British, who
+now hold the heart of the Near East. The gains of Great Britain in
+Africa include Togoland, German Southwest Africa and German East Africa.
+With these accessions of territory, Great Britain holds a continuous
+stretch of country from the Cape to Cairo. A British subject can
+therefore travel on British soil from Cape Town via the Isthmus of Suez,
+to Siam, covering a distance as the crow flies of something like 10,000
+miles.
+
+The British gains in the South Pacific include Kaiser Wilhelm Land and
+the German islands south of the Equator.
+
+What these territorial gains mean in the way of additional resources for
+the industries of the home country, only the future can decide. Certain
+it is, that outside of the Americas, Central Europe, Russia, China and
+Japan, Great Britain succeeded in annexing most of the important
+territory of the world.
+
+The _Chicago Tribune_, in one of its charmingly frank editorials, thus
+describes the gains to the British Empire as a result of the war. "The
+British mopped up. They opened up their highway from Cairo to the Cape.
+They reached out from India and took the rich lands of the Euphrates.
+They won Mesopotamia and Syria in the war. They won Persia in diplomacy.
+They won the east coast of the Red Sea. They put protecting territory
+about Egypt and gave India bulwarks. They made the eastern dream of the
+Germans a British reality.
+
+"The British never had their trade routes so guarded as now. They never
+had their supremacy of the sea so firmly established. Their naval
+competitor, Germany, is gone. No navy threatens them. No empire
+approximates their size, power, and influence.
+
+"This is the golden age of the British Empire, its Augustan age. Any
+imperialistic nation would have fought any war at any time to obtain
+such results, and as imperialistic nations count costs, the British
+cost, in spite of its great sums in men and money was small." (January
+4, 1920.)
+
+
+5. _Half the World--Without a Struggle_
+
+Two significant facts stand out in this record of spoils distribution.
+One is that Great Britain received the lion's share of them in Asia and
+Africa. The other, that there is no mention of the Americas. Outside of
+the Western Hemisphere, Great Britain is mistress. In the Americas, with
+the exception of Canada, the United States is supreme.
+
+There are two reasons for this. One is that Germany's ambitions and
+possessions included Asia and Africa primarily--and not America. The
+other is that the Peace Conference recognized the right of the United
+States to dominate the Western Hemisphere.
+
+The representatives of the United States declared that their country was
+asking for nothing from the Peace Conference. Nevertheless, the
+insistent clamor from across the water led the American delegation to
+secure the insertion in the revised League Covenant of Article XXI which
+read: "Nothing in this covenant shall be deemed to affect the validity
+of international engagements, such as treaties of arbitration or
+regional understandings like the Monroe Doctrine for securing the
+maintenance of peace." This article coupled with the first portion of
+Article X, "The members of the League undertake to respect and preserve
+as against external aggression the territorial integrity and existing
+political independence of all members of the League," guarantees to the
+United States complete authority over Latin America, reserving to her
+political suzerainty and economic priority.
+
+The half of the earth reserved to the United States under these
+provisions contains some of the richest mineral deposits, some of the
+largest timber areas, and some of the best agricultural territory in the
+world. Thus at the opening of the new era, the United States, at the
+cost of a comparatively small outlay in men and money, has guaranteed to
+her by all of the leading capitalist powers practically an exclusive
+privilege for the exploitation of the Western Hemisphere.
+
+
+
+
+XV. PAN-AMERICANISM
+
+
+1. _America for the Americans_
+
+In the partition of the earth, one-half was left under the control of
+the United States. Among the great nations, parties to the war and the
+peace, the United States alone asked for nothing--save the acceptance by
+the world of the Monroe Doctrine. The doctrine, as generally understood,
+makes her mistress of the Western Hemisphere.
+
+The Monroe Doctrine originated in the efforts of Latin America to
+establish its independence of imperial Europe, and the counter efforts
+of imperial Europe to fasten its authority on the newly created Latin
+American Republics. President Monroe, aroused by the European crusade
+against popular government, wrote a message to Congress (1823) in which
+he stated the position of the United States as follows:
+
+"The American continents, by the free and independent condition which
+they have assumed and maintained, are henceforth not to be considered as
+subjects for future colonization by any European powers."
+
+Monroe continues by pointing out that the United States must view any
+act which aims to establish European authority in the Americas as
+"dangerous to our peace and safety."
+
+"The United States will keep her hands off Europe; she will expect
+Europe to keep her hands off America," was the essence of the doctrine,
+which has been popularly expressed in the phrase "America for the
+Americans." The Doctrine was thus a statement of international
+aloofness,--a declaration of American independence of the remainder of
+the world.
+
+The Monroe Doctrine soon lost its political character. The southern
+statesmen who were then guiding the destinies of the United States were
+looking with longing eyes into Texas, Mexico, Cuba and other potential
+slave-holding territory. Later, the economic necessities of the northern
+capitalists led them in the same direction. Professor Roland G. Usher,
+in his "Pan-Americanism" (New York, The Century Company, 1915, pp.
+391-392) insists that the Monroe Doctrine stands "First, for our
+incontrovertible right of self-defense. In the second place the Monroe
+Doctrine has stood for the equally undoubted right of the United States
+to champion and protect its primary economic interest against Europe or
+America."
+
+Through the course of a century this statement of defensive policy has
+been converted into a doctrine of economic pseudo-sovereignty. It is no
+longer a case of keeping Europe out of Latin America but of getting the
+United States into Latin America.
+
+The United States does not fear political aggression by Europe against
+the Western Hemisphere. On the contrary, the aggression to-day is
+largely economic, and the struggle for the markets and the investment
+opportunities of Latin America is being waged by the capitalists of
+every great industrial nation, including the United States.
+
+
+2. _Latin America_
+
+Four of the Latin American countries, viewed from the standpoint of
+population and of immediately available assets, rank far ahead of the
+remainder of Latin America. Mexico, with a population in 1914-1915 of
+15,502,000, had an annual government revenue of $72,687,000. The
+population of Brazil is 27,474,000. The annual revenue (1919) is
+$183,615,000. Argentine, with a population of 8,284,000, reported annual
+revenues of $159,000,000 (1918); and Chile, with a population of
+3,870,000, had an annual revenue of $77,964,000 (1917). These four
+states rank in political and economic importance close to Canada.
+
+Great Britain holds a number of strategic positions in the West Indies.
+Other nations have minor possessions in Latin America. None of these
+possessions, however, is of considerable economic or political
+importance. There remain Bolivia, Uruguay, Colombia, Ecuador, Paraguay,
+Peru, Venezuela, and the Central American states. The most populous of
+these countries is Peru (5,800,000 persons). All of the Central American
+states combined have a population of less than 6,000,000. The annual
+revenues of Uruguay (population 1,407,000) are $30,453,000 (1918-19).
+The combined government revenues of all Central America are less than
+twenty-five millions. (_Statistical Abstract of the U. S._, 1919, p.
+826ff.)
+
+Compared with the hundred million population of the United States; its
+estimated wealth (1918) of 250 billions; and its federal revenues of a
+billion and a half in 1916, the Latin American republics cut a very
+small figure indeed. The United States, bristling with economic surplus
+and armed with the Monroe Doctrine, as accepted and interpreted in the
+League Covenant, is free to turn her attention to the rich opportunities
+offered by the undeveloped territory stretching from the Rio Grande to
+Cape Horn. What is there to hinder her movements in this direction?
+Nothing but the limitation on her own needs and the adherence to her own
+public policies. This vast area, containing approximately nine million
+square miles (three times the area of continental United States), has a
+population of only a little over seventy millions. The entire government
+revenues of the territory are in the neighborhood of six hundred
+million, but so widely scattered are the people, so sharp are their
+nationalistic differences, and so completely have they failed to build
+up anything like an effective league to protect their common interests,
+that skillful maneuvering on the part of American economic and political
+interests should meet with no effectual or thoroughgoing opposition.
+
+The "hands off America" doctrine which the United States has enunciated,
+and which Europe has accepted, means first that none of the Latin
+American Republics is permitted to enter into any entangling alliances
+without the approval of the United States. In the second place it means
+that the United States is free to treat all Latin American countries in
+the same way that she has treated Cuba, Hayti and Nicaragua during the
+past twenty years.
+
+
+3. _Economic "Latin America"_
+
+The United States is the chief producer--in the Western Hemisphere--of
+the manufactured supplies needed by the relatively undeveloped countries
+of Latin America. At the same time, the undeveloped countries of Latin
+America contain great supplies of ores, minerals, timber and other raw
+materials that are needed by the expanding manufacturing interests of
+the United States. The United States is a country with an investible
+surplus. Latin America offers ample opportunity for the investment of
+that surplus. Surrounding the entire territory is a Chinese wall in the
+form of the Monroe Doctrine--intangible but none the less effective.
+
+Before the outbreak of the Great War, European capitalists dominated the
+Latin American investment market. The five years of struggle did much to
+eliminate European influence in Latin America.
+
+The situation was reviewed at length in a publication of the United
+States Department of Commerce "Investments in Latin America and the
+British West Indies," by Frederick M. Halsey (Washington Government
+Printing Office, 1918):
+
+"Concerning the undeveloped wealth of various South American countries,"
+writes Mr. Halsey, "it may be said that minerals exist in all the
+Republics, that the forest resources of all (except possibly Uruguay)
+are very extensive, that oil deposits have been found in almost every
+country and are worked commercially in Argentine, Colombia, Chile,
+Ecuador, Peru and Venezuela, and that there are lands available for the
+raising of live stock and for agricultural purposes" (p. 20).
+
+As to the pre-war investments, Mr. Halsey points out that "Great Britain
+has long been the largest investor in Latin America" (p. 20). The total
+of British investments he places at 5,250 millions of dollars. A third
+of this was invested in Argentine, a fifth in Brazil and nearly a sixth
+in Mexico. French investments are placed at about one and a half
+billions of dollars. The German investments were extensive, particularly
+in financial and trading institutions. United States investments in
+Latin America before the war "were negligible" (p. 19) outside of the
+investments in the mining industry and in the packing business.
+
+Just how much of a shift the war has occasioned in the ownership of
+Latin American railways, public utilities, mines, etc., it is impossible
+to say. Some such change has occurred, however, and it is wholly in the
+interest of the United States.
+
+Generalizations which apply to Latin America have no force in respect to
+Canada. The capitalism of Canada is closely akin to the capitalism of
+the United States.
+
+Canada possesses certain important resources which are highly essential
+to the United States. Chief among them are agricultural land and timber.
+There are two methods by which the industrial interests of the United
+States might normally proceed with relations to the Canadian resources.
+One is to attack the situation politically, the other is to absorb it
+economically. The latter method is being pursued at the present time. To
+be sure there is a large annual emigration from the United States into
+Canada (approximately 50,000 in 1919) but capital is migrating faster
+than human beings.
+
+The Canadian Bureau of Statistics reports (letter of May 20, 1920) on
+"Stocks, Bonds and other Securities held by incorporated and joint stock
+Companies engaged in manufacturing industries in Canada, 1918," as owned
+by 8,130,368 individual holders, distributed geographically as follows:
+Canada, $945,444,000; Great Britain, $153,758,000; United States,
+$555,943,000, and other countries, $17,221,322. Thus one-third of this
+form of Canadian investment is held in the United States.
+
+
+4. _American Protectorates_
+
+The close economic inter-relations that are developing in the Americas,
+naturally have their counter-part in the political field. As the
+business interests reach southward for oil, iron, sugar, and tobacco
+they are accompanied or followed by the protecting arm of the State
+Department in Washington. Few citizens of the United States realize how
+thoroughly the conduct of the government, particularly in the Caribbean,
+reflects the conduct of the bankers and the traders.
+
+Professor Hart in his "New American History" (American Book Co., 1917,
+p. 634) writes, "In addition the United States between 1906 and 1916
+obtained a protectorate over the neighboring Latin American States of
+Cuba, Hayti, Panama, Santo Domingo and Nicaragua. All together these
+five states include 157,000 square miles and 6,000,000 people."
+Professor Hart makes this statement under the general topic, "What
+America Has Done for the World."
+
+The Monroe Doctrine, logically applied to Latin America, can have but
+one possible outcome. Professor Chester Lloyd Jones characterizes that
+outcome in the following words, "Steadily, quietly, almost unconsciously
+the extension of international responsibility southward has become
+practically a fixed policy with the State Department. It is a policy
+which the record of the last sixteen years shows is followed, not
+without protest from influential factions, it is true, but none the less
+followed, by administrations of both parties and decidedly different
+shades within one of the parties.... Protests will continue but the
+logic of events is too strong to be overthrown by traditional argument
+or prejudice." ("Caribbean Interests." New York, Appleton, 1916, p.
+125.)
+
+Latin America is in the grip of the Monroe Doctrine. Whether the
+individual states wish it or not they are the victims of a principle
+that has already shorn them of political sovereignty by making their
+foreign policy subject to veto by the United States, and that will
+eventually deprive them of control over their own internal affairs by
+placing the management of their economic activities under the direction
+of business interests centering in the United States. The protectorate
+which the United States will ultimately establish over Latin America was
+forecast in the treaty which "liberated" Cuba. The resolution declaring
+war upon Spain was prefaced by a preamble which demanded the
+independence of Cuba. Presumably this independence meant the right of
+self-government. Actually the sovereignty of Cuba is annihilated by the
+treaty of July 1, 1904, which provides:
+
+"Article I. The Government of Cuba shall never enter into any treaty or
+compact with any foreign power or powers which will impair or tend to
+impair the independence of Cuba, nor in any matter authorize or permit
+any foreign power or powers to obtain by colonization or for military or
+naval purposes, or otherwise, lodgement in, or control over any portion
+of said island."
+
+The most drastic limitations upon Cuba's sovereignty are contained in
+Article 3 which reads, "the Government of Cuba consents that the United
+States may exercise the right to intervene for the preservation of Cuban
+independence, the maintenance of a government adequate for the
+protection of life, property and individual liberty, and for discharging
+the obligation with respect to Cuba imposed by the Treaty of Paris on
+the United States now to be assumed and undertaken by the Government of
+Cuba." Under this article, the United States, at her discretion, may
+intervene in Cuba's internal affairs.
+
+Under these treaty provisions the Cuban Government is not only prevented
+from exercising normal governmental functions in international matters,
+but if a change of internal government should take place which in the
+opinion of the United States jeopardized "life, property and individual
+liberty" such a government could be suppressed by the armed forces of
+the United States and a government established in conformity with her
+wishes. Theoretically, Cuba is an independent nation. Practically, Cuba
+has signed away in her treaty with the United States every important
+attribute of sovereignty.
+
+The fact that Cuba was a war-prize of the United States might be
+advanced as an explanation of her anomalous position, were it not for
+the relations now existing between the Dominican Republic, Hayti and
+Nicaragua on the one hand and the United States on the other. The United
+States has never been at war with any of these countries, yet her
+authority over them is complete.
+
+The Convention between the United States and the Dominican Republic,
+proclaimed July 25, 1907, gave the United States the right to appoint a
+receiver of Dominican customs in order that the financial affairs of the
+Republic might be placed on a sound basis. This appointment was followed
+in 1916 by the landing of the armed forces of the United States in the
+territory of the Dominican Republic. On November 29, 1916, a military
+government was set up by the United States Marine Corps under a
+proclamation approved by the President. "This military government at
+present conducts the administration of the government" (Letter from
+State Department, September 29, 1919).
+
+The proclamation issued by the Commander of the United States Marine
+Corps and approved by the President, cited the failure of the Dominican
+government to live up to its treaty obligations because of internal
+dissensions and stated that the Republic is made subject to military
+government and to the exercise of military law applicable to such
+occupation. Dominican statutes "will continue in effect insofar as they
+do not conflict with the objects of the Occupation or necessary
+relations established thereunder, and their lawful administration will
+continue in the hands of such duly authorized Dominican officials as
+may be necessary, all under the oversight and control of the United
+States forces exercising Military Government." The proclamation further
+announces that the Military Government will collect the revenues and
+hold them in trust for the Republic.
+
+Following this proclamation Captain H. S. Knapp issued a drastic order
+providing for a press censorship. "Any comment which is intended to be
+published on the attitude of the United States Government, or upon
+anything connected with the Occupation and Military Government of Santo
+Domingo must first be submitted to the local censor for approval. In
+case of any violation of this rule the publication of any newspaper or
+periodical will be suspended; and responsible persons,--owners, editors,
+or others--will further be liable to punishment by the Military
+Government. The printing and distribution of posters, handbills, or
+similar means of propaganda in order to disseminate views unfavorable to
+the United States Government or to the Military Government in Santo
+Domingo is forbidden." (Order secured from the Navy Department and
+published by The American Union against Militarism, Dec. 13, 1916.)
+
+A similar situation exists in Hayti. The treaty of May 3, 1916, provides
+that "The Government of the United States will, by its good officers,
+aid the Haitian Government in the proper and efficient development of
+its agricultural, mineral and commercial resources and in the
+establishment of the finances of Hayti on a firm and solid basis."
+(Article I) "The President of Hayti shall appoint upon nomination by the
+President of the United States a general receiver and such aids and
+employees as may be necessary to manage the customs. The President of
+Hayti shall also appoint a nominee of the President of the United States
+as 'financial adviser' who shall 'devise an adequate system of public
+accounting, aid in increasing revenues' and take such other steps 'as
+may be deemed necessary for the welfare and prosperity of Hayti.'"
+(Article II.) Article III guarantees "aid and protection of both
+countries to the General Receiver and the Financial Adviser." Under
+Article X "The Haitian Government obligates itself ... to create without
+delay an efficient constabulary, urban and rural, composed of native
+Haitians. This constabulary shall be organized and officered by
+Americans." The Haitian Government under Article XI, agrees not to
+"surrender any of the territory of the Republic by sale, lease or
+otherwise, or jurisdiction over such territory, to any foreign
+government or power" nor to enter into any treaty or contract that "will
+impair or tend to impair the independence of Hayti." Finally, to
+complete the subjugation of the Republic, Article XIV provides that
+"should the necessity occur, the United States will lend an efficient
+aid for the preservation of Haitian independence and the maintenance of
+a government adequate for the protection of life, property and
+individual liberty."
+
+A year later, on August 20, 1917, the _New York Globe_ carried the
+following advertisement:--
+
+
+                             FORTUNE IN SUGAR
+
+     "The price of labor in practically all the cane sugar growing
+     countries has gone steadily up for years, except in Hayti, where
+     costs are lowest in the world.
+
+     "_Hayti now is under U. S. Control._
+
+     "The Haitian-American corporation owns the best sugar lands in
+     Hayti, owns railroads, wharf, light and power-plants, and is
+     building sugar mills of the most modern design. There is assured
+     income in the public utilities and large profits in the sugar
+     business. We recommend the purchase of the stock of this
+     corporation. Proceedings are being taken to list this stock on the
+     New York Stock Exchange.
+
+     "Interesting story 'Sugar in Hayti' mailed on request.
+
+     "P. W. Chapman & Co., 53 William St., N. Y. C."
+
+
+Hayti remained "under United States control" until the revelations of
+the summer of 1920 (see _The Nation_, July 10 and August 28, 1920), when
+it was shown that the natives were being compelled, by the American
+forces of occupation, to perform enforced labor on the roads and to
+accept a rule so tyrannous that thousands had refused to obey the orders
+of the military authorities, and had been shot for their pains. On
+October 14, 1920, the _New York Times_ printed a statement from
+Brigadier General George Barnett, formerly Commandant General of the
+Marine Corps, covering the conditions in Hayti between the time the
+marines landed (July, 1915) and June, 1920. General Barnett alleges in
+his report that there was evidence of "indiscriminate" killing of the
+natives by the American Marines; that "shocking conditions" had been
+revealed in the trial of two members of the army of occupation, and that
+the enforced labor system should be abolished forthwith. The report
+shows that, during the five years of the occupation, 3,250 Haytians had
+been killed by the Americans. During the same period, the losses to the
+army of occupation were 1 officer and 12 men killed and 2 officers and
+26 men wounded.
+
+The attitude of the United States authorities toward the Haytians is
+well illustrated by the following telegram which the United States
+Acting Secretary of the Navy sent on October 2, 1915, to Admiral
+Caperton, in charge of the forces in Hayti: "Whenever the Haytians wish,
+you may permit the election of a president to take place. The election
+of Dartiguenave is preferred by the United States."
+
+The Cuban Treaty established the precedent; the Great War provided the
+occasion, and while Great Britain was clinching her hold in Persia, and
+Japan was strengthening her grip on Korea, the United States was engaged
+in establishing protectorates over the smaller and weaker Latin-American
+peoples, who have been subjected, one after another, to the omnipotence
+of their "Sister Republic" of the North.
+
+
+5. _The Appropriation of Territory_
+
+Protectorates have been established by the United States, where such
+action seemed necessary, over some of the weaker Latin-American states.
+Their customs have been seized, their governments supplanted by military
+law and the "preservation of law and order" has been delegated to the
+Army and Navy of the United States. The United States has gone farther,
+and in Porto Rico and Panama has appropriated particular pieces of
+territory.
+
+The Porto Ricans, during the Spanish-American War, welcomed the
+Americans as deliverers. The Americans, once in possession, held the
+Island of Porto Rico as securely as Great Britain holds India or Japan
+holds Korea. The Porto Ricans were not consulted. They had no
+opportunity for "self-determination." They were spoils of war and are
+held to-day as a part of the United States.
+
+The Panama episode furnishes an even more striking instance of the
+policy that the United States has adopted toward Latin-American
+properties that seemed particularly necessary to her welfare.
+
+Efforts to build a Panama Canal had covered centuries. When President
+Roosevelt took the matter in hand he found that the Government of
+Colombia was not inclined to grant the United States sovereignty over
+any portion of its territory. The treaty signed in 1846 and ratified in
+1848 placed the good faith of the United States behind the guarantee
+that Colombia should enjoy her sovereign rights over the Isthmus. During
+November 1902 the United States ejected the representatives of Colombia
+from what is now the Panama Canal Zone and recognized a revolutionary
+government which immediately made the concessions necessary to enable
+the United States to begin its work of constructing the canal.
+
+The issue is made clear by a statement of Mr. Roosevelt frequently
+reiterated by him (see _The Outlook_, October 7, 1911) and appearing in
+the _Washington Post_ of March 24, 1911, as follows:--"I am interested
+in the Panama Canal because I started it. If I had followed the
+traditional conservative methods I would have submitted a dignified
+state paper of probably two hundred pages to the Congress and the debate
+would have been going on yet. But I took the Canal Zone and let the
+Congress debate, and while the debate goes on, the Canal does also."
+
+Article 35 of the Treaty of 1846 between the United States and Colombia
+(then New Grenada) reads as follows,--"The United States guarantees,
+positively and efficaciously to New Grenada, by the present stipulation,
+the perfect neutrality of the before mentioned Isthmus ... and the
+rights of sovereignty which New Grenada has and possesses over said
+territory."
+
+In 1869 another treaty was negotiated between the United States and
+Colombia which provided for the building of a ship canal across the
+Isthmus. This treaty was signed by the presidents of both republics and
+ratified by the Colombian Congress. The United States Senate refused its
+assent to the treaty. Another treaty negotiated early in 1902 was
+ratified by the United States Senate but rejected by the Colombian
+Congress. The Congress of the United States had passed an act (June 28,
+1902) "To provide for the construction of a canal connecting the waters
+of the Atlantic and the Pacific Oceans." Under this act the President
+was authorized to negotiate for the building of the canal across the
+Isthmus of Panama. If that proved impossible within a reasonable time,
+the President was to turn to the Nicaragua route. The treaty prepared in
+accordance with this act provided that the United States would pay
+Colombia ten millions of dollars in exchange for the sovereignty over
+the Canal Zone. The Colombian Congress after a lengthy debate rejected
+the treaty and adjourned on the last day of October, 1902.
+
+Rumor had been general that if the treaty was not ratified by the
+Colombian Government, the State of Panama would secede from Colombia,
+sign the treaty, and thus secure the ten millions. In consequence of
+these rumors, which threatened transportation across the Isthmus,
+American war vessels were dispatched to Panama and to Colon.
+
+On November 3, 1902, the Republic of Panama was established. On November
+13 it was recognized by the United States. Immediately thereafter a
+treaty was prepared and ratified by both governments and the ten
+millions were paid to the Government of Panama.
+
+Early in the day of November 3, the Department of State was informed
+that an uprising had occurred. Mr. Loomis wired, "Uprising on Isthmus
+reported. Keep Department promptly and fully informed." In reply to this
+the American consul replied, "The uprising has not occurred yet; it is
+announced that it will take place this evening. The situation is
+critical." Later the same official advised the Department that (in the
+words of the Presidential message, 1904) "the uprising had occurred and
+had been successful with no bloodshed."
+
+The Colombian Government had sent troops to put down the insurrection
+but the Commander of the United States forces, acting under instructions
+sent from Washington on November 2, prevented the transportation of the
+troops. His instructions were as follows,--"Maintain free and
+uninterrupted transit if interruption is threatened by armed force with
+hostile intent, either governmental or insurgent, at any point within
+fifty miles of Panama. Government forces reported approaching the
+Isthmus in vessels. Prevent their landing, if, in your judgment, the
+landing would precipitate a conflict."
+
+Thus a revolution was consummated under the watchful eye of the United
+States forces; the home government at Bogota was prevented from taking
+any steps to secure the return of the seceding state of Panama to her
+lawful sovereignty, and within ten days of the revolution, the new
+Republic was recognized by the United States Government.[57] (Ten days
+was the length of time necessary to transmit a letter from Panama to
+Washington. Greater speed would have been impossible unless the new
+state had been recognized by telegraph.)
+
+
+6. _The Logical Exploiters_
+
+The people of the United States are the logical exploiters of the
+Western Hemisphere--the children of destiny for one half the world. They
+are pressed by economic necessity. They need the oil of Mexico, the
+coffee of Brazil, the beef of Argentine, the iron of Chile, the sugar of
+Cuba, the tobacco of Porto Rico, the hemp of Yucatan, the wheat and
+timber of Canada. In exchange for these commodities the United States is
+prepared to ship manufactured products. Furthermore, the masters of the
+United States have an immense and growing surplus that must be invested
+in some paying field, such as that provided by the mines, agricultural
+projects, timber, oil deposits, railroad and other industrial activities
+of Latin-America.
+
+The rulers of the United States are the victims of an economic necessity
+that compels them to seek and to find raw materials, markets and
+investment opportunities. They are also the possessors of sufficient
+economic, financial, military and naval power to make these needs good
+at their discretion.
+
+The rapidly increasing funds of United States capital invested in
+Latin-America and Canada, will demand more and more protection. There is
+but one way for the United States to afford that protection--that is to
+see that these countries preserve law and order, respect property, and
+follow the wishes of United States diplomacy. Wherever a government
+fails in this respect, it will be necessary for the State Department in
+coöperation with the Navy, to see that a government is established that
+will "make good."
+
+Under the Monroe Doctrine, as it has long been interpreted, no
+Latin-American Government will be permitted to enter into entangling
+alliances with Europe or Asia. Under the Monroe Doctrine, as it is now
+being interpreted, no Latin-American people will be permitted to
+organize a revolutionary government that abolishes the right of private
+interests to own the oil, coal, timber and other resources. The mere
+threat of such action by the Carranza Government was enough to show what
+the policy of the United States must be in such an emergency.
+
+The United States need not dominate politically her weaker sister
+republics. It is not necessary for her to interfere with their
+"independence." So long as their resources may be exploited by American
+capitalists; so long as the investments are reasonably safe; so long as
+markets are open, and so long as the other necessities of United States
+capitalism are fulfilled, the smaller states of the Western Hemisphere
+will be left free to pursue their various ways in prosperity and peace.
+
+FOOTNOTE:
+
+[57] For further details see "The Panama Canal" Papers presented to the
+Senate by Mr. Lodge, Senate Document 471, 63rd Congress, 2nd Session.
+
+
+
+
+XVI. THE AMERICAN CAPITALISTS AND WORLD EMPIRE
+
+
+1. _The Plutocrats Must Carry On_
+
+The American plutocrats--those who by force of their wealth share in the
+direction of public policy--must carry on. They have no choice. If they
+are to continue as plutocrats, they must continue to rule. If they
+continue to rule, they must shoulder the duties of rulership. They may
+not relish the responsibility which their economic position has thrust
+upon them any more than the sojourners in Newfoundland relish the savage
+winters. Nevertheless, those who own the wealth of a capitalist nation
+must accept the results of that ownership just as those who remain in
+Newfoundland must accept the winter storms.
+
+The owners of American timber, mines, factories, railroads, banks and
+newspapers may dislike the connotations of imperialism; may believe
+firmly in the principles of competition and individualism; may yearn for
+the nineteenth century isolation which was so intimate a feature of
+American economic life. But their longings are in vain. The old world
+has passed forever; the sun has risen on a new day--a day of world
+contacts for the United States.
+
+Henry Cabot Lodge of Massachusetts stated the matter with rare accuracy
+in a speech which he made during the discussion over the conquest of the
+Philippines. After explaining that wars come, "never ostensibly, but
+actually from economic causes," Senator Lodge said (_Congressional
+Record_, 56th Congress, 2nd Session, p. 637. January 7, 1901):
+
+"We occupy a great position economically. We are marching on to a still
+greater one. You may impede it, you may check it, but you cannot stop
+the work of economic forces. You cannot stop the advance of the United
+States.... The American people and the economic forces which underlie
+all are carrying us forward to the economic supremacy of the world."
+
+Senator Lodge spoke the economic truth in 1901. William C. Redfield
+reënforced it in an address before the American Manufacturers Export
+Association (_Weekly Bulletin_, April 26, 1920, p. 7): "We cannot be
+foreign merchants very much longer in this country excepting on a
+diminishing and diminishing scale--we have got to become foreign
+constructors; we have got to build with American money--foreign
+enterprises, railroads, utilities, factories, mills, I know not what, in
+order that by large ownership in them we may command the trade that
+normally flows from their operation." That is sound capitalist doctrine.
+Equally sound is the exhortation that follows: "In so doing we shall be
+doing nothing new--only new for us. That is the way in which Germany and
+Great Britain have built up their foreign trade."
+
+New it is for America--but it is the course of empire, familiar to every
+statesman. The lesson which Bismarck, Palmerston and Gray learned in the
+last century is now being taught by economic pressure to the ruling
+class of the United States.
+
+The elder generation of American business men was not trained for world
+domination. To them the lesson comes hard. The business men of the
+younger generation are picking it up, however, with a quickness born of
+paramount necessity.
+
+
+2. _Training Imperialists_
+
+Every great imperial structure has had simple beginnings. Each imperial
+ruling class has doubtless felt misgivings, during the early years of
+its authority. Hesitating, uncertain, they have cast glances over their
+shoulders towards that which was, but even while they were looking
+backward the forces that had made them rulers were thrusting them still
+farther forward along the path of imperial power. Then as generation
+succeeded generation, the rulers learned their lesson, building a
+tradition of rulership and authority that was handed down from father to
+son; acquiring a vision of world organization and world power that gave
+them confidence to go forward to their own undoing. The masters of
+public life in Rome were such people; the present masters of British
+economic and political affairs are such people.
+
+American imperialists still are in the making. Until 1900 their eyes
+were set almost exclusively upon empire within the United States. Those
+who, before 1860, dreamed of a slave power surrounding the Gulf of
+Mexico, were thrust down and their places taken by builders of railroads
+and organizers of trusts. To-day the sons and grandsons of that
+generation of exploiters who confined their attention to continental
+territory, are compelled, by virtue of the organization which their
+sires and grandsires established, to seek Empire outside the boundaries
+of North America.
+
+During the years when the leaders of American business life were
+spending the major part of their time in "getting rich," the sweep of
+social and economic forces was driving the United States toward its
+present imperial position. Now the position has been attained, those in
+authority have no choice but to accept the responsibilities which
+accompany it.
+
+Economically the United States is a world power. The war and the
+subsequent developments have forced the country suddenly into a position
+of leadership among the capitalist nations. The law of capitalism is:
+Struggle to dispose of your surplus, otherwise you cannot survive. This
+law has laid its heavy hand upon Great Britain, upon France, upon
+Germany, and now it has struck with full force into the isolated,
+provincial life of the United States. It is the law--immutable as the
+system of gravitation. While the present system of economic life
+exists, this law will continue to operate. Therefore the masters of
+American life have no alternative. If they would survive, they must
+dispose of their surplus.
+
+Politically the United States is recognized as one of the leaders of the
+world. Despite its tradition of isolation, despite the unwillingness of
+its statesmen to enter new paths, despite the indifference of its people
+to international affairs, the resources and raw materials required by
+the industrial nations of Europe, the rapidly growing surplus and the
+newly acquired foreign markets and investments make the United States an
+integral part of the life of the world.
+
+The ruling class in the United States has no more choice than the rulers
+of a growing city whose boundaries are extending with each increment of
+population. If it is to continue as a ruling class, it must accept
+conditions as they are. The first of these conditions is that the United
+States is a world power neither because of its virtue nor because of its
+intelligence in the delicacies of the world politics, but because of the
+sheer might of its economic organization.
+
+Economic necessity has forced the United States into the front rank
+among the nations of the world. Economic necessity is forcing the ruling
+class of the United States to occupy the position of world leadership,
+to strengthen it, to consolidate it, and to extend it at every
+opportunity. The forces that played beside the yellow Tiber and the
+sluggish Nile are very much the same as those which led Napoleon across
+the wheat fields of Europe and that are to-day operating in Paris,
+London, and in New York. The forces that pushed the Roman Empire into
+its position of authority and led to the organization of Imperial
+Britain are to-day operating with accelerated pace in the United States.
+The sooner the American people, and particularly those who are directing
+public policy, wake up to this simple but essential fact, the sooner
+will doubt and misunderstanding be removed, the sooner will the issues
+be drawn and the nation's course be charted.
+
+
+3. _The Logical Goal_
+
+The logical goal of the American plutocracy is the economic and
+incidentally the political control of the world. The rulers of Macedon
+and Assyria, Rome and Carthage, of Britain and France labored for
+similar reasons to reach this same goal. It is economic fate. Kings and
+generals were its playthings, obeying and following the call of its
+destiny.
+
+The rulers of antiquity were limited by a lack of transportation
+facilities; their "world" was small, including the basin of the
+Mediterranean and the land surrounding the Persian Gulf and the Indian
+Ocean, nevertheless, they set out, one after another, to conquer it.
+To-day the rapid accumulation of surplus and the speed and ease of
+communication, the spread of world knowledge and the larger means of
+organization make it even more necessary than it was of old for the
+rulers of an empire to find a larger and ever larger place in the sun.
+The forces are more pressing than ever before. The times call more
+loudly for a genius with imagination, foresight and courage who will use
+the power at his disposal to write into political history the gains that
+have already been made a part of economic life. Let such a one arise in
+the United States, in the present chaos of public thought, and he could
+not only himself dictate American public policy for the remainder of his
+life, but in addition, he could, within a decade, have the whole
+territory from the Canadian border to the Panama Canal under the
+American Flag, either as conquered or subject territory; he could
+establish a Chinese wall around South American trade and opportunities
+by a very slight extension of the Monroe Doctrine; he could have in hand
+the problem of an economic if not a political union with Canada, and
+could be prepared to measure swords with the nearest economic rival,
+either on the high seas or in any portion of the world where it might
+prove necessary to join battle.
+
+Such a program would be a departure from the traditions of American
+public life, but the traditions, built by a nation of farmers, have
+already lost their significance. They are historic, with no contemporary
+justification. The economic life that has grown up since 1870 of
+necessity will create new public policies.
+
+The success of such a program would depend upon four things:
+
+1. A coördination of American economic life.
+
+2. A fast grip on the agencies for shaping public opinion.
+
+3. A body of citizens, martial, confident, restless, ambitious.
+
+4. A ruling class with sufficient imagination to paint, in warm
+sympathetic colors, the advantages of world dominion; and with
+sufficient courage to follow out imperial policy, regardless of ethical
+niceties, to its logical goal of world conquest.
+
+All four of these requisites exist in the United States to-day, awaiting
+the master hand that shall unite them. Many of the leaders of American
+public life know this. Some shrink from the issue, because they are
+unaccustomed to dream great dreams, and are terrified by the immensity
+of large thoughts. Others lack the courage to face the new issues. Still
+others are steadily maneuvering themselves into a position where they
+may take advantage of a crisis to establish their authority and work
+their imperial will. The situation grows daily more inviting; the
+opportunity daily more alluring. The war-horse, saddled and bridled, is
+pawing the earth and neighing. How soon will the rider come?
+
+
+4. _Eat or Be Eaten_
+
+The American ruling class has been thrown into a position of authority
+under a system of international economic competition that calls for
+initiative and courage. Under this system, there are two
+possibilities,--eat or be eaten!
+
+There is no middle ground, no half way measure. It is impossible to
+stop or to turn back. Like men engaged on a field of battle, the
+contestants in this international economic struggle must remain with
+their faces toward the enemy, fighting for every inch that they gain,
+and holding these gains with their bodies and their blood, or else they
+must turn their backs, throw away their weapons, run for their lives,
+and then, hiding on the neighboring hills, watch while the enemy
+despoils the camp, and then applies a torch to the ruins.
+
+The events of the great war prove, beyond peradventure, that in the wolf
+struggle among the capitalist nations, no rules are respected and no
+quarter given. Again and again the leaders among the allied
+statesmen--particularly Mr. Lloyd George and Mr. Wilson--appealed to the
+German people over the heads of their masters with assurances that the
+war was being fought against German autocracy, not against Germans.
+"When will the German people throw off their yoke?" asked one Allied
+diplomat. The answer came in November, 1918. A revolution was contrived,
+the Kaiser fled the country, the autocracy was overthrown. Germans
+ceased to fight with the understanding that Mr. Wilson's Fourteen Points
+should be made the foundation of the Peace. The armistice terms violated
+the spirit if not the letter of the fourteen points; the Peace Treaty
+scattered them to the winds. Under its provisions Germany was stripped
+of her colonies; her investments in the allied possessions were
+confiscated; her ships were taken; three-quarters of her iron ore and a
+third of her coal supply were turned over to other powers; motor trucks,
+locomotives, and other essential parts of her economic mechanism were
+appropriated. Austria suffered an even worse fate, being "drawn and
+quartered" in the fullest sense of the term. After stripping the
+defeated enemies of all available booty, levying an indeterminate
+indemnity, and dismembering the German and Austrian Empires, the Allies
+established for thirty years a Reparation Commission, which is virtually
+the economic dictator of Europe. Thus for a generation to come, the
+economic life of the vanquished Empires will be under the active
+supervision and control of the victors. Never did a farmer's wife pluck
+a goose barer than the Allies plucked the Central Powers. (See the
+Treaty, also "The Economic Consequences of the Peace," J. M. Keynes. New
+York, Harcourt, Brace & Howe, 1920.)
+
+Under the armistice terms and the Peace Treaty the Allies did to Germany
+and Austria exactly what Germany and Austria would have done to France
+and Great Britain had the war turned out differently. The Allied
+statesmen talked much about democracy, but when their turn came they
+plundered and despoiled with a practiced imperial hand. France and
+Britain, as well as Germany and Austria, were capitalist Empires. The
+Peace embodies the essential economic morality of capitalist
+imperialism, the morality of "Eat or be eaten."
+
+
+5. _The Capitalists and War_
+
+The people and even the masters of America are inexperienced in this
+international struggle. Among themselves they have experimented with
+competitive industrialism on a national scale. Now, brought face to face
+with the world struggle, many of them revolt against it. They deplore
+the necessities that lead nations to make war on one another. They
+supported the late war "to end war." They gave, suffered and sacrificed
+with a keen, idealistic desire to "make the world safe for democracy."
+They might as well have sought to scatter light and sunshine from a
+cloudbank.
+
+The masters of Europe, who have learned their trade in long years of
+intrigue, diplomacy and war, feel no such repugnance. They play the
+game. The American people are of the same race-stocks as the leading
+contestants in the European struggle. They are not a whit less
+ingenious, not a whit less courageous, not a whit less determined. When
+practice has made them perfect they too will play the game just as well
+as their European cousins and their play will count for more because of
+the vast economic resources and surpluses which they possess.
+
+American statesmen in the field of international diplomacy are like
+babies, taking their first few steps. Later the steps come easier and
+easier, until a child, who but a few months ago could not walk, has
+learned to romp and sport about. The masters of the United States are
+untrained in the arts of international intrigue. They showed their
+inferiority in the most painful way during the negotiations over the
+Paris Treaty. They are as yet unschooled in international trade, banking
+and finance. They are also inexperienced in war, yet, having only raw
+troops, and little or no equipment, within two years they made a notable
+showing on the battlefields of Europe. Now they are busy learning their
+financial lessons with an equal facility. A generation of contact with
+world politics will bring to the fore diplomats capable of meeting
+Europe's best on their own ground. What Europe has learned, America can
+learn; what Europe has practiced, America can practice, and in the end
+she may excel her teachers.
+
+To-day economic forces are driving relentlessly. Surplus is accumulating
+in a geometric ratio--surplus piling on surplus. This surplus must be
+disposed of. While the remainder of the world--except Japan--is
+staggering under intolerable burdens of debt and disorganization, the
+United States emerges almost unscathed from the war, and prepares in
+dead earnest to enter the international struggle,--to play at the master
+game of "eat or be eaten."
+
+Pride, ambition and love of gain and of power are pulling the American
+plutocrats forward. The world seems to be within their grasp. If they
+will reach out their hands they may possess it! They have assumed a
+great responsibility. As good Americans worthy of the tradition of their
+ancestors, they must see this thing through to the end! They must win,
+or die in the attempt; and it is in this spirit that they are going
+forward.
+
+The American capitalists do not want war with Great Britain or with any
+other country. They are not seeking war. They will regret war when it
+comes.
+
+War is expensive, troublesome and dangerous. The experiences of Europe
+in the War of 1914 have taught some lessons. The leaders and thinkers
+among the masters of America have visited Europe. They have seen the old
+institutions destroyed, the old customs uprooted, the old faiths
+overturned. They have seen the economic order in which they were vitally
+concerned hurled to the earth and shattered. They have seen the red flag
+of revolution wave where they had expected nothing but the banner of
+victory. They have seen whole populations, weary of the old order, throw
+it aside with an impatient gesture and bring a new order into being.
+They have good reasons to understand and fear the disturbing influences
+of war. They have felt them even in the United States--three thousand
+miles away from the European conflict. How much more pressing might this
+unrest be if the United States had fought all through the war, instead
+of coming in when it was practically at an end!
+
+Then there is always the danger of losing the war--and such a loss would
+mean for the United States what it has meant for Germany--economic
+slavery.
+
+Presented with an opportunity to choose between the hazards of war and
+the certainties of peace most of the capitalist interests in the United
+States would without question choose peace. There are exceptions. The
+manufacturers of munitions and of some of the implements and supplies
+that are needed only for war purposes, undoubtedly have more to gain
+through war than through peace, but they are only a small element in a
+capitalist world which has more to gain through peace than through war.
+
+But the capitalists cannot choose. They are embedded in an economic
+system which has driven them--whether they liked it or not--along a path
+of imperialism. Once having entered upon this path, they are compelled
+to follow it into the sodden mire of international strife.
+
+
+6. _The Imperial Task_
+
+The American ruling class--the plutocracy--must plan to dominate the
+earth; to exploit it, to exact tribute from it. Rome did as much for the
+basin of the Mediterranean. Great Britain has done it for Africa and
+Australia, for half of Asia, for four million square miles in North
+America. If the people of one small island, poorly equipped with
+resources, can achieve such a result, what may not the people of the
+United States hope to accomplish?
+
+That is the imperial task.
+
+
+     1. American economic life must be unified. Already much of this
+     work has been done.
+
+     2. The agencies for shaping public opinion must be secured. Little
+     has been left for accomplishment in this direction.
+
+     3. A martial, confident, restless, ambitious spirit must be
+     generated among the people. Such a result is being achieved by the
+     combination of economic and social forces that inhere in the
+     present social system.
+
+     4. The ruling class must be schooled in the art of rulership. The
+     next two generations will accomplish that result.
+
+
+The American plutocracy must carry on. It must consolidate its gains and
+move forward to greater achievements, with the goal clearly in mind and
+the necessities of imperial power thoroughly mastered and understood.
+
+
+
+
+XVII. THE NEW IMPERIAL ALIGNMENT
+
+
+1. _A Survey of the Evidence_
+
+Through the centuries empires have come and gone. In each age some
+nation or people has emerged--stronger, better organized, more
+aggressive, more powerful than its neighbors--and has conquered
+territory, subjugated populations, and through its ruling class has
+exploited the workers at home and abroad.
+
+Europe has been for a thousand years the center of the imperial
+struggle,--the struggle which called into being the militarism so hated
+by the European peoples. It was from that struggle that millions fled to
+America, where they hoped for liberty and peace.
+
+The eighteenth century witnessed the rise of Great Britain to a position
+of world authority. During the nineteenth century she held her place
+against all rivals. With the assistance of Prussia, she overthrew
+Napoleon at Waterloo. In the Crimean War and the Russo-Japanese War she
+halted the power of the Czar. Half a century after Waterloo Germany,
+under the leadership of Prussia won the Franco-Prussian War, and by that
+act became the leading rival of the British Empire. Following the war,
+which gave Germany control of the important resources included in Alsace
+and Lorraine, there was a steady increase in her industrial efficiency;
+the success of her trade was as pronounced as the success of her
+industries, and by 1913 the Germans had a merchant fleet and a navy
+second only to those of Great Britain.
+
+Germany's economic successes, and her threat to build a railroad from
+Berlin to Bagdad and tap the riches of the East, led the British to form
+alliances with their traditional enemies--the French and the Russians.
+Russia, after the breakdown of Czarism in 1917, dropped out of the
+Entente, and the United States took her place among the Allies of the
+British Empire. During the struggle France was reduced to a mere shell
+of her former power. The War of 1914 bled her white, loaded her with
+debt, disorganized her industries, demoralized her finances, and
+although it restored to her important mineral resources, it left her too
+weak and broken to take real advantage of them.
+
+The War of 1914 decided the right of Great Britain to rule the Near East
+as well as Southern Asia and the strategic points of Africa. In the
+stripping of the vanquished and in the division of the spoils of war the
+British lion proved to be the lion indeed. But the same forces that gave
+the British the run of the Old World called into existence a rival in
+the New.
+
+People from Britain, Germany and the other countries of Northern Europe,
+speaking the English language and fired with the conquering spirit of
+the motherland, had been, for three centuries, taming the wilderness of
+North America. They had found the task immense, but the rewards equally
+great. When the forces of nature were once brought into subjection, and
+the wilderness was inventoried, it proved to contain exactly those
+stores that are needed for the success of modern civilization. With the
+Indians brushed aside, and the Southwest conquered from Mexico, the new
+ruling class of successful business men established itself, and the
+matter of safeguarding property rights, of building industrial empires
+and of laying up vast stores of capital and surplus followed as a matter
+of course.
+
+Europe, busy with her own affairs, paid little heed to the New World,
+except to send to it some of her most rugged stock and much of her
+surplus wealth. The New World, left to itself, pursued its way--in
+isolation, and with an intensity proportioned to the size of the task in
+hand and the richness of the reward.
+
+The Spanish War in 1898 and the performance of the Canadians in the Boer
+War of 1899 astounded the world, but it was the War of 1914 that really
+waked the Europeans to the possibilities of the Western peoples. The
+Canadians proved their worth to the British armies. The Americans showed
+that they could produce prodigious amounts of the necessaries of war,
+and when they did go in, they inaugurated a shipping program, raised and
+dispatched troops, furnished supplies and provided funds to an extent
+which, up to that time, was considered impossible. The years from 1914
+to 1918 established the fact that there was, in the West, a colossus of
+economic power.
+
+
+2. _The New International Line-Up_
+
+There are four major factors in the new international line-up. The first
+is Russia; the second is the Japanese Empire; the third is the British
+Empire and the fourth is the American Empire. Italy has neither the
+resources, the wealth nor the population necessary to make her a factor
+of large importance in the near future. France is too weak economically,
+too overloaded with debt and too depleted in population to play a
+leading rôle in world affairs.
+
+The Russian menace is immediate. Bolshevism is not only the antithesis
+of Capitalism but its mortal enemy. If Bolshevism persists and spreads
+through Central Europe, India and China, capitalism will be wiped from
+the earth.
+
+A federation of Russia, the Baltic states, the new border provinces, and
+the Central Empires on a socialist basis would give the socialist states
+of central and northern Europe most of the European food area, a large
+portion of the European raw material area and all of the technical skill
+and machinery necessary to make a self-supporting economic unit. The two
+hundred and fifty millions of people in Russia and Germany combined in
+such a socialist federation would be as irresistible economically as
+they would be from a military point of view.
+
+Such a Central European federation, developing as it must along the
+logical lines that lead into India and China would be the strongest
+single unit in the world, viewed from the standpoint of resources, of
+population, of productive power or of military strength. The only
+possible rivals to such a combination would be the widely scattered
+forces of the British Empire and the United States, separated from it by
+the stretches of the Atlantic Ocean. Against such a grouping Japan would
+be powerless because it would deprive her of the source of raw materials
+upon which she must rely for her economic development. Great Britain
+with her relatively small population and her rapidly diminishing
+resources could make no head against such a combination even with the
+assistance of her colonial empire. Northern India is as logical a home
+for Bolshevism as Central China or South-eastern Russia. Connect
+European Russia, Germany, Austria-Hungary, Siberia, India and China with
+bonds that make effective coöperation possible and these
+countries--containing nearly two-thirds of the population of the world,
+and possessed of the resources necessary to maintain a modern
+civilization--could laugh at outside interference.
+
+Two primary difficulties confront the organizers of the Federated
+Socialist Republics of Europe and Asia. One is nationality, language,
+custom and tradition, together with the ancient antagonisms which have
+been so carefully nurtured through the centuries. The other is the
+frightful economic disorganization prevalent throughout Central
+Europe,--a disorganization which would be increased rather than
+diminished by the establishment of new forms of economic life. Even if
+such an organization were perfected, it must remain, for a long time to
+come, on a defensive basis.
+
+
+3. _The Yellow Peril_
+
+The "yellow peril" thus far is little more than the Japanese menace to
+British and American trade in the Far East. The Japanese Archipelago is
+woefully deficient in coal, iron, petroleum, water power and
+agricultural land. The country is over-populated and must depend for
+its supplies of food and raw materials upon continental Asia. There
+seems to be no probability that Japan and China can make any effective
+working agreement in the near future that will constitute an active
+menace to the supremacy of the white race. Alone Japan is too weak in
+resources and too sparse in population. Combined with China she would be
+formidable, but her military policy in Korea and in the Shantung
+Province have made any effective coöperation with China at least
+temporarily impossible.
+
+Furthermore, the Japanese are not seeking world conquest. On the
+contrary, they are bent upon maintaining their traditional aloofness by
+having a Monroe Doctrine for the East. This doctrine will be summed up
+in the phrase, "The East for the Easterners,"--the easterners being the
+Japanese. Such a policy would prove a serious menace to the trade of the
+United States and of Great Britain. It would prove still more of a
+hindrance to the investment of American and British capital in the very
+promising Eastern enterprises, and would close the door on the Western
+efforts to develop the immense industrial resources of China. The recent
+"Chinese Consortium," in which Japan joined with great reluctance,
+suggests that the major capitalist powers have refused to recognize the
+exclusive right of Japan to the economic advantages of the Far East. How
+seriously this situation will be taken by the United States and Great
+Britain depends in part upon the vigor with which Japan prosecutes her
+claims and in part upon the preoccupation of these two great powers with
+Bolshevism in Europe and with their own competitive activities in ship
+building, trade, finance and armament.
+
+
+4. _The British and the American Empires_
+
+The two remaining major forces in world economics and politics are the
+British Empire and the American Empire,--the mistress of the world, and
+her latest rival in the competition for world power. Between them,
+to-day, most of the world is divided. The British Empire includes the
+Near East, Southern Asia, Africa, Australia and half of North America.
+Dogging her are Germany, France, Russia and Italy, and, as she goes to
+the Far East,--Japan. The United States holds the Western Hemisphere,
+where she is supreme, with no enemy worthy the name.
+
+The British power was shaken by the War of 1914. Never, in modern times,
+had the British themselves, been compelled to do so much of the actual
+fighting. The war debt and the disorganization of trade incident to the
+war period proved serious factors in the curtailment of British economic
+supremacy. At the same time, the territorial gains of the British were
+enormous, particularly in the Near East.
+
+The Americans secured real advantages from the war. They grew immensely
+rich in profiteering during the first three years, they emerged with a
+relatively small debt, with no great loss of life, and with the greatest
+economic surpluses and the greatest immediate economic advantages
+possessed by any nation of the world.
+
+The British Empire was the acknowledged mistress of the world in 1913.
+Her nearest rival (Germany) had one battleship to her two; one ton of
+merchant shipping to her three, and two dollars of foreign investments
+to her five. This rivalry was punished as the successive rivals of the
+British Empire have been punished for three hundred years.
+
+The war was won by the British Empire and her Allies, but in the hour of
+victory a new rival appeared. By 1920 that rival had a naval program
+which promised a fleet larger than the British fleet in 1924 or 1925;
+within three years she had increased her merchant tonnage to two-thirds
+of the British tonnage, and her foreign investments were three times the
+foreign investments of Great Britain. This new rival was the American
+Empire--whose immense economic strength constituted an immediate threat
+to the world power of Great Britain.
+
+
+5. _The Next Incident in the Great War_
+
+Some nation, or some group of nations has always been in control of the
+known world or else in active competition for the right to exercise such
+a control. The present is an era of competition.
+
+Capitalism has revolutionized the world's economic life. By 1875 the
+capitalist nations were in a mad race to determine which one should
+dominate the capitalist world and have first choice among the
+undeveloped portions of the earth. The competitors were Great Britain,
+Germany, France, Russia and Italy. Japan and the United States did not
+really enter the field for another generation.
+
+The War of 1914 decided this much:--that France and Italy were too weak
+to play the big game in a big way, that Germany could not compete
+effectively for some time to come; that the Russians would no longer
+play the old game at all. There remained Japan, Great Britain and the
+United States and it is among these three nations that the capitalist
+world is now divided. Japan is in control of the Far East. Great Britain
+holds the Near East, Africa and Australia; the United States dominates
+the Western Hemisphere.
+
+The Great War began in 1914. It will end when the question is decided as
+to which of these three empires will control the Earth.
+
+Great Britain has been the dominant factor in the world for a century.
+She gained her position after a terrific struggle, and she has
+maintained it by vanquishing Holland, Spain, France and Germany.
+
+The United States is out to capture the economic supremacy of the earth.
+Her business men say so frankly. Her politicians fear that their
+constituents are not as yet ready to take such a step. They have been
+reassured, however, by the presidential vote of November, 1920.
+American business life already is imperial, and political sentiment is
+moving rapidly in the same direction.
+
+Great Britain holds title to the pickings of the world. America wants
+some or all of them. The two countries are headed straight for a
+conflict, which is as inevitable as morning sunrise, unless the menace
+of Bolshevism grows so strong, and remains so threatening that the great
+capitalist rivals will be compelled to join forces for the salvation of
+capitalist society.
+
+As economic rivalries increase, competition in military and naval
+preparation will come as a matter of course. Following these will be the
+efforts to make political alliances--in the East and elsewhere.
+
+These two countries are old time enemies. The roots of that enmity lie
+deep. Two wars, the white hot feeling during the Civil War, the
+anti-British propaganda, carried, within a few years, through the
+American schools, the traditions among the officers in the American
+navy, the presence of 1,352,251 Irish born persons in the United States
+(1910), the immense plunder seized by the British during the War of
+1914,--these and many other factors will make it easy to whip the
+American people into a war-frenzy against the British Empire.
+
+Were there no economic rivalries, such antagonisms might slumber for
+decades, but with the economic struggle so active, these other matters
+will be kept continually in the foreground.
+
+The capitalists of Great Britain have faced dark days and have
+surmounted huge obstacles. They are not to be turned back by the threat
+of rivalry. The American capitalists are backed by the greatest
+available surpluses in the world; they are ambitious, full of enthusiasm
+and energy, they are flushed with their recent victory in the world war,
+and overwhelmed by the unexpected stores of wealth that have come to
+them as a result of the conflict. They are imbued with a boundless faith
+in the possibilities of their country. Neither Great Britain nor the
+United States is in a frame of mind to make concessions. Each is
+confident--the British with the traditional confidence of centuries of
+world leadership; the Americans with the buoyant, idealistic confidence
+of youth. It is one against the other until the future supremacy of the
+world is decided.
+
+
+6. _The Imperial Task_
+
+American business interests are engaged in the work of building an
+international business structure. American industry, directed from the
+United States, exploiting foreign resources for American profit, and
+financed by American institutions, is gaining a footing in Latin
+America, in Europe and Asia.
+
+The business men of Rome built such a structure two thousand years ago.
+They competed with and finally crushed their rivals in Tyre, Corinth and
+Carthage. In the early days of the Empire, they were the economic
+masters, as well as the political masters of the known world.
+
+Within two centuries the business men of Great Britain have built an
+international business structure that has known no equal since the days
+of the Cæsars. Perhaps it is greater, even, than the economic empire of
+the Romans. At any rate, for a century that British empire of commerce
+and industry has gone unchallenged, save by Germany. Germany has been
+crushed. But there is an industrial empire rising in the West. It is
+new. Its strength is as yet undetermined. It is uncoördinated. A new era
+has dawned, however, and the business men of the United States have made
+up their minds to win the economic supremacy of the earth.
+
+Already the war is on between Great Britain and the United States. The
+two countries are just as much at war to-day as Great Britain and
+Germany were at war during the twenty years that preceded 1914. The
+issues are essentially the same in both cases,--commercial and economic
+in character, and it is these economic and commercial issues that are
+the chief causes of modern military wars--that are in themselves
+economic wars which may at any moment be transferred to the military
+arena.
+
+British capitalists are jealously guarding the privileges that they have
+collected through centuries of business and military conflict. The
+American capitalists are out to secure these privileges for themselves.
+On neither side would a military settlement of the issue be welcomed. On
+both sides it would be regarded as a painful necessity. War is an
+incident in imperialist policy. Yet the position of the imperialist as
+an international exploiter depends upon his ability to make war
+successfully. War is a part of the price that the imperialist must pay
+for his opportunity to exploit and control the earth.
+
+After Sedan, it was Germany versus Great Britain for the control of
+Europe. After Versailles it is the United States versus Great Britain
+for the control of the capitalist earth. Both nations must spend the
+next few years in active preparation for the conflict.
+
+The governments of Great Britain and the United States are to-day on
+terms of greatest intimacy. Soon an issue will arise--perhaps over
+Mexico, perhaps over Persia, perhaps over Ireland, perhaps over the
+extension of American control in the Caribbean. There is no difficulty
+of finding a pretext.
+
+Then there will follow the time-honored method of arousing the people on
+either side to wrath against those across the border. Great Britain will
+point to the race-riots and negro-lynchings in America as a proof that
+the people of the United States are barbarians. British editors will
+cite the wanton taking of the Canal Zone as an indication of the
+willingness of American statesmen to go to any lengths in their effort
+to extend their dominion over the earth. The newspapers of the United
+States will play up the terrorism and suppression in Ireland and there
+are many Irishmen more than ready to lend a hand in such an enterprise;
+tyranny in India will come in for a generous share of comment; then
+there are the relations between Great Britain and the Turks, and above
+all, there are the evidences in the Paris Treaty of the way in which
+Great Britain is gradually absorbing the earth. Unless the power of
+labor is strong enough to turn the blow, or unless the capitalists
+decide that the safety of the capitalist world depends upon their
+getting together and dividing the plunder, the result is inevitable.
+
+The United States is a world Empire in her own right. She dominates the
+Western Hemisphere. Young and inexperienced, she nevertheless possesses
+the economic advantages and political authority that give her a voice in
+all international controversies. Only twenty years have passed since the
+organizing genius of America turned its attention from exclusively
+domestic problems to the problems of financial imperialism that have
+been agitating Europe for a half a century. The Great War showed that
+American men make good soldiers, and it also showed that American wealth
+commands world power.
+
+With the aid of Russia, France, Japan and the United States Great
+Britain crushed her most dangerous rival--Germany. The struggle which
+destroyed Germany's economic and military power erected in her stead a
+more menacing economic and military power--the United States. Untrained
+and inexperienced in world affairs, the master class of the United
+States has been placed suddenly in the title rôle. America over night
+has become a world empire and over night her rulers have been called
+upon to think and act like world emperors. Partly they succeeded, partly
+they bungled, but they learned much. Their appetites were whetted, their
+imaginations stirred by the vision of world authority. To-day they are
+talking and writing, to-morrow they will act--no longer as novices, but
+as masters of the ruling class in a nation which feels herself destined
+to rule the earth.
+
+The imperial struggle is to continue. The Japanese Empire dominates the
+Far East; the British Empire dominates Southern Asia, the Near East,
+Africa and Australia; the American Empire dominates the Western
+Hemisphere. It is impossible for these three great empires to remain in
+rivalry and at peace. Economic struggle is a form of war, and the
+economic struggle between them is now in progress.
+
+
+7. _Continuing the Imperial Struggle_
+
+The War of 1914 was no war for democracy in spite of the fact that
+millions of the men who died in the trenches believed that they were
+fighting for freedom. Rather it was a war to make the world safe for the
+British Empire. Only in part was the war successful. The old world was
+made safe by the elimination of Britain's two dangerous rivals--Germany
+and Russia; but out of the conflict emerged a new rival--unexpectedly
+strong, well equipped and eager for the conflict.
+
+The war did not destroy imperialism. It was fought between five great
+empires to determine which one should be supreme. In its result, it gave
+to Great Britain rather than to Germany the right to exploit the
+undeveloped portions of Asia and of Africa.
+
+The Peace--under the form of "mandates"--makes the process of
+exploitation easier and more legal than it ever has been in the past.
+The guarantees of territorial integrity, under the League Covenant, do
+more than has ever been done heretofore to preserve for the imperial
+masters of the earth their imperial prerogatives.
+
+New names are being used but it is the old struggle. Egypt and India
+helped to win the war, and by that very process, they fastened the
+shackles of servitude more firmly upon their own hands and feet. The
+imperialists of the world never had less intention than they have to-day
+of quitting the game of empire building. Quite the contrary--a wholly
+new group of empire builders has been quickened into life by the
+experiences of the past five years.
+
+The present struggle for the possession of the oil fields of the world
+is typical of the economic conflicts that are involved in imperial
+struggles. For years the capitalists of the great investing nations
+have been fighting to control the oil fields of Mexico. They have hired
+brigands, bought governors, corrupted executives. The war settled the
+Mexican question in favor of the United States. Mexico, considered
+internationally, is to-day a province of the American Empire.
+
+During the blackest days of the war, when Paris seemed doomed, the
+British divided their forces. One army was operating across the deserts
+of the Near East. For what purpose? When the Peace was signed, Great
+Britain held two vantage points--the oil fields of the Near East and the
+road from Berlin to Bagdad.
+
+The late war was not a war to end war, nor was it a war for disarmament.
+German militarism is not destroyed; the appropriations for military and
+naval purposes, made by the great nations during the last two years, are
+greater than they have ever been in any peace years that are known to
+history.
+
+The world is preparing for war to-day as actively as it was in the years
+preceding the War of 1914. The years from 1914 to 1918 were the opening
+episodes; the first engagements of the Great War.
+
+There is no question, among those who have taken the trouble to inform
+themselves, but that the War of 1914 was fought for economic and
+commercial advantage. The same rivalries that preceded 1914 are more
+active in the world to-day than ever before. Hence the possibilities of
+war are greater by exactly that amount. The imperial struggle is being
+continued and a part of the imperial struggle is war.
+
+
+8. _Again!_
+
+This monstrous thing called war will occur again! Not because any
+considerable number of people want it, not even because an active
+minority wills it, but because the present system of competitive
+capitalism makes war inevitable. Economic rivalries are the basis of
+modern wars and economic rivalries are the warp and woof of capitalism.
+
+To-day the rivalries are economic--in the fields of commerce and
+industry and finance. To-morrow they will be military.
+
+Already the nations have begun the competition in the building of tanks,
+battleships and airplanes. These instruments of destruction are built
+for use, and when the time comes, they will be used as they were between
+1914 and 1918.
+
+Again there will be the war propaganda--subtle at first, then more and
+more open. There will be stories of atrocities; threats of world
+conquest. "Preparedness" will be the cry.
+
+Again there will be the talk of "My country, right or wrong"; "Stand
+behind the President"; "Fall in line"; "Go over the top!"
+
+Again fear will stalk through the land, while hate and war lust are
+whipped into a frenzy.
+
+Again there will be conscription, and the straightest and strongest of
+the young men will leave their homes and join the colors.
+
+Again the most stalwart men of the nations will "dig themselves in" and
+slaughter one another for years on end.
+
+Again the truth-tellers will be mobbed and jailed and lynched, while
+those who champion the cause of the workers will be served with
+injunctions if they refuse to sell out to the masters.
+
+Again the profiteers will stop at home and reap their harvests out of
+the agony and the blood of the nation.
+
+Again, when the killing is over, a few old men, sitting around a table,
+will carve the world--stripping the vanquished while they reward the
+victors.
+
+Again the preparations will begin for the next war. The people will be
+fed on promises, phrases and lies. They will pay and they will die for
+the benefit of their masters, and thus the terrible tragedy of
+imperialism will continue to bathe the world in tears and in blood.
+
+
+
+
+XVIII. THE CHALLENGE TO IMPERIALISM
+
+
+1. _Revolutionary Protest_
+
+Since the Franco-Prussian War the people of Europe have been waking up
+to the failure of imperialism. The period has been marked by a rapid
+growth of Socialism on the continent and of trade-unionism in Great
+Britain. Both movements are expressions of an increasing working-class
+solidarity; both voice the sentiments of internationalism that were
+sounded so loudly during the revolutionary period of the eighteenth
+century.
+
+The rapid growth of the European labor movement worried the autocrats
+and imperialists. Bismarck suppressed it; the Russian police tortured
+it. Despite all of the efforts to check it or to crush it, the
+revolutionary movement in Europe gained force. The speeches and writings
+of the leaders were directed against the capitalist system, and the rank
+and file of the workers, rendered sharply class conscious by the
+traditions of class rule, responded to the appeal by organizing new
+forms of protest.
+
+The first revolutionary wave of the twentieth century broke in Russia in
+1905. The Russian Revolution of 1917 destroyed the old régime and
+replaced it first by a moderate or liberal and then by a radical
+communist control. Like all of the proletarian movements in Europe the
+Russian revolutionary movement was directed against "capitalism" and
+"imperialism" and despite the fact that there was no considerable
+development of the capitalist system in Russia, its imperial
+organization was so thoroughgoing, and the imperial attitude toward the
+working class had been so brutally revealed during the revolutionary
+demonstrations in 1905, that the people reacted with a true Slavic
+intensity against the despotism that they knew, which was that of an
+autocratic, feudal master-class.
+
+The international doctrines of the new Russian régime were expressed in
+the phrase "no forcible annexations, no punitive indemnities, the free
+development of all peoples." The keynote of its internal policy is
+contained in Section 16 of the Russian Constitution, which makes work
+the duty of every citizen of the Republic and proclaims as the motto of
+the new government the doctrine, "He that will not work neither shall he
+eat." The franchise is restricted. Only workers (including housekeepers)
+are permitted to vote. Profiteers and exploiters are specifically denied
+the right to vote or to hold office. Resources are nationalized together
+with the financial and industrial machinery of Russia. The Bill of
+Rights contained in the first section of the Russian Constitution is a
+pronouncement in favor of the liberty of the workers from every form of
+exploitation and economic oppression.
+
+The Russian revolution was directed against capitalism in Russia and
+against imperialism everywhere. This dramatic assault upon capitalist
+imperialism centered the eyes of the world upon Russia, making her
+experiment the outstanding feature of a period during which the workers
+were striving to realize the possibilities of a more abundant life for
+the masses of mankind.
+
+
+2. _Outlawing Bolshevism_
+
+Capitalist diplomats were wary of the Kerensky régime because they did
+not feel certain how far the Russian people intended to go. The triumph
+of the Bolsheviki made the issue unmistakably clear. There could be no
+peace between Bolshevism and capitalism. From that day forward it was a
+struggle to determine which of the two economic systems should survive.
+
+During the years 1918 and 1919 the capitalist world organized one of the
+most effective advertising campaigns that has ever been staged. Every
+shred of evidence that, by any stretch of the imagination, could be
+distorted into an attack upon the Bolshevist régime, was scattered
+broadcast over the world. Where evidence was lacking, rumor and
+innuendo were employed. The leading newspapers and magazines, prominent
+statesmen, educators, clergymen, scientists and public men in every walk
+of life went out of their way to denounce the Russian experiment in very
+much the same manner that the propertied interests of Europe had
+denounced the French experiment during the years that followed 1789.
+
+All of the great imperialist governments had at their disposal a vast
+machinery for the purveying of information--false or true as the case
+might demand. This public machinery like the machinery of private
+capitalism was turned against Bolshevism. The capitalist governments
+went farther by backing with money and supplies the counter
+revolutionary forces under Yudenich, Denekine, Seminoff, and Kolchak.
+Allied expeditions were landed on the soil of European and Asiatic
+Russia "to free the Russian people from the clutches of the Bolsheviki."
+A blockade was declared in which the Germans were invited to join (after
+the signing of the armistice), and the whole capitalist world united to
+starve into submission the men, women and children of revolutionary
+Russia.
+
+No event of recent times, not even the holy war against the autocracy of
+militarist Germany, had created such a unanimity of action among the
+Western nations. Bolshevism threatened the very existence of capitalism
+and as such its destruction became the first task of the capitalist
+world.
+
+The collapse of the capitalist efforts to destroy socialist Russia
+reflects the power of a new idea over the ancient form. The Allied
+expeditions into Russia met with hostility instead of welcome. The
+counter-revolutionary forces were overwhelmed by the red army. The
+buffer states made peace. The Allied soldiers mutinied when called upon
+to take part in a war against the forces of revolutionary Russia. "Holy
+Russia" became holy Russia indeed--recognized and respected by the
+proletarian forces throughout Europe.
+
+
+3. _The New Europe_
+
+Russia is the dramatic center of the European movement against
+capitalist imperialism, but the movement is not confined to Russia. Its
+activities are extended into every important country on the continent.
+
+Since March, 1917, when the first revolution occurred in Russia,
+absolute monarchy and divine, kingly rights have practically disappeared
+from Europe. Before the Russian Revolution, four-fifths of the people of
+Europe were under the sway of monarchs who exercised dictatorial power
+over the domestic and foreign affairs of their respective nations.
+Within two years, the Hohenzollerns, the Hapsburgs and the Romanoffs
+were driven from the thrones of Germany, of Austria and of Russia. Other
+rulers of lesser importance followed in their wake, until to-day, the
+old feudal power that held the political control over most of Europe in
+1914 has practically disappeared.
+
+This is the obvious thing--a revolution in the form of political
+government--the kind of revolution with which history usually deals.
+
+But there is another revolution proceeding in Europe, far more important
+because more fundamental--the economic and social revolution; the change
+in the form of breadwinning; the change in the relation between a man
+and the tools that he uses to earn his livelihood.
+
+Every one knows, now, that Czars and Kaisers and Emperors did not really
+control Europe before 1914, except in so far as they yielded to bankers
+and to business men. The crown and the scepter gave the appearance of
+power, but behind them were concessions, monopolies, economic
+preferments, and special privilege. The European revolution that began
+in 1917 with the Czar, did not stop with kings. It began with them
+because they were in such plain sight, but when it had finished with
+them it went right on to the bankers and the business men.
+
+War is destruction, organized and directed by the best brains
+available. It is merry sport for the organizers and for some of the
+directors, but like any other destructive agent, it may get out of hand.
+The War of 1914 was to last for six weeks. It dragged on for five years,
+and the wars that have grown out of it are still continuing. In the
+course of those five years, the war destroyed the capitalist system of
+continental Europe. Patches and shreds of it remained, but they were
+like the topless, shattered trees on the scarred battle-fields. They
+were remnants--nothing more. In the first place, the war destroyed the
+confidence of the people in the capitalist system; in the second place,
+it smashed up the political machinery of capitalism; in the third place,
+it weakened or destroyed the economic machinery of capitalism.
+
+Each government, to win the war, lied to its people. They were told that
+their country was invaded. They were assured that the war would be a
+short affair. Besides that, there were various reasons given for the
+struggle--it was a war to end war; it was a war to break the iron ring
+that was crushing a people; it was a war for liberty; it was a struggle
+to make the world safe for democracy.
+
+Not a single important promise of the war was fulfilled, save only the
+promise of victory. Hundreds of millions, aroused to the heights of an
+exalted idealism, came back to earth only to find themselves betrayed.
+With less promise and more fulfillment; with at least an appearance of
+statesmanship; with some respect for the simple moralities of
+truth-telling, fair-dealing, and common honor, there might have been
+some chance for the capitalist system to retain the confidence of the
+peoples of war-torn Europe, even in the face of the Russian Revolution;
+but each of these things was lacking, and as one worker put it: "I don't
+know what Bolshevism is, but it couldn't be any worse than what we have
+now, so I'm for it!"
+
+Such a loss of public confidence would have proved a serious blow to any
+social system, even were it capable of immediately reëstablishing normal
+conditions of living among the people. In this case, the same events
+that destroyed public confidence in the capitalist system, destroyed the
+system itself.
+
+The old political forms of Europe--the czars, emperors and kaisers, who
+stood as the visible symbols of established order and civilization, were
+overthrown during the war. The economic forces--the banks and business
+men--had used these forms for the promotion of their business
+enterprises. Capitalism depended on czars and kaisers as a blacksmith
+depends on his hammer. They were among the tools with which business
+forged the chains of its power. They were the political side of the
+capitalist system. While the people accepted them and believed in them,
+the business interests were able to use these political tools at will.
+The tools were destroyed in the fierce pressure of war and revolution,
+and with them went one of the chief assets of the European capitalists.
+
+There was a third breakdown--far more important than the break in the
+political machinery of the capitalist system--and that was the
+annihilation of the old economic life.
+
+Economic life is, in its elements, very simple. Raw materials--iron ore,
+copper, cotton, petroleum, coal and wheat--are converted, by some
+process of labor, into things that feed, clothe and house people. There
+are four stages in this process--raw materials; manufacturing;
+transportation; marketing. If there is a failure in one of the four, all
+of the rest go wrong, as is very clearly illustrated whenever there is a
+great miners' or railroad workers' strike, or when there is a failure of
+a particular crop. During the war, all four of these economic stages
+went wrong.
+
+Between the years 1914 and 1918 the people of Europe busied themselves
+with a war that put their economic machine out of the running.
+
+For a hundred years the European nations had been busy building a finely
+adjusted economic mechanism; population, finance, commerce--all were
+knit into the same system. This system the war demolished, and the years
+that have followed the Armistice have not seen it rebuilt in any
+essential particular, save in Great Britain and in some of the neutral
+countries.
+
+Not only were the European nations unable to give commodities in
+exchange for the things they needed but the machinery of finance, by
+means of which these transactions were formerly facilitated, was
+crippled almost beyond repair. Under the old system buying and selling
+were carried on by the use of money, and money ceased to be a stable
+medium of exchange in Europe. It would be more correct to say that money
+was no longer taken seriously in many parts of Europe. During the war
+the European governments printed 75 billions of dollars' worth of paper
+money. This paper depreciated to a ridiculous extent. Before the war,
+the franc, the lira, the mark and the crown had about the same value--20
+to 23 cents, or about five to a dollar. By 1920 the dollar bought 15
+francs; 23 liras; 40 marks, and 250 Austrian crowns. In some of the
+ready-made countries, constituted under the Treaty or set up by the
+Allies as a cordon about Russia, hundreds and thousands of crowns could
+be had for a dollar. Even the pound sterling, which kept its value
+better than the money of any of the other European combatants, was
+thirty per cent. below par, when measured in terms of dollars. This
+situation made it impossible for the nations whose money was at such a
+heavy discount to purchase supplies from the more fortunate countries.
+But to make matters even worse, the rate of exchange fluctuated from day
+to day and from hour to hour so that business transactions could only be
+negotiated on an immense margin of safety.
+
+Add to this financial dissolution the mountains of debt, the huge
+interest charges and the oppressive taxes, and the picture of economic
+ruin is complete.
+
+The old capitalist world, organized on the theory of competition between
+the business men within each nation, and between the business men of one
+nation and those of another nation, reached a point where it would no
+longer work.
+
+In Russia the old system had disappeared, and a new system had been set
+up in its place. In Germany, and throughout central Europe, the old
+system was shattered, and the new had not yet emerged. In France, Italy
+and Great Britain the old system was in process of disintegration--rapid
+in France and Italy; slower in Great Britain. But in all of these
+countries intelligent men and women were asking the only question that
+statesmanship could ask--the question, "What next?"
+
+The capitalist system was stronger in Great Britain than in any of the
+other warring countries of Europe. Before the war, it rested on a surer
+foundation. During the war, it withstood better than any other the
+financial and industrial demands. Since the war, it has made the best
+recovery.
+
+Great Britain is the most successful of the capitalist states. The other
+capitalist nations of Europe regard her as the inner citadel of European
+capitalism. The British Labor Movement is seeking to take this citadel
+from within.
+
+The British Labor Movement is a formidable affair. There are not more
+than a hundred thousand members in all of the Socialist parties, in the
+Independent Labor Party and in the Communist Party combined. There are
+between six and seven millions of members in the trade unions.
+
+Perhaps the best test of the strength of the British Labor Movement came
+in the summer of 1920, over the prospective war with Russia. Warsaw was
+threatened. Its fall seemed imminent, and both Millerand and
+Lloyd-George made it clear that the fall of Warsaw meant war. The
+situation developed with extraordinary rapidity. It was reported that
+the British Government had dispatched an ultimatum. The Labor Movement
+acted with a strength and precision that swept the Government off its
+feet and compelled an immediate reversal of policy.
+
+Over night, the workers of Great Britain were united in the Council of
+Action. As originally constituted, the "Labor and Russia Council of
+Action" consisted of five representatives each from the Parliamentary
+Committee of the Trades Union Congress, the Executive Committee of the
+Labor Party and the Parliamentary Labor Party. To these fifteen were
+added eight others, among whom were representatives of every element in
+the British Labor Movement. This Council of Action did three things--it
+notified the Government that there must be no war with Russia; it
+organized meetings and demonstrations in every corner of the United
+Kingdom to formulate public opinion; it began the organization of local
+councils of action, of which there were three hundred within four weeks.
+The Council of Action also called a special conference of the British
+Labor Movement which met in London on August 13. There were over a
+thousand delegates at this conference, which opened and closed with the
+singing of the "Internationale." When the principal resolution of
+endorsement was passed, approving the formation of the Council of
+Action, the delegates rose to their feet, cheered the move to the echo,
+and sang the "Internationale" and "The Red Flag." The closing resolution
+authorized the Council of Action to take "any steps that may be
+necessary to give effect to the decisions of the Conference and the
+declared policy of the Trade Union and Labor Movement."
+
+Such was the position in the "Citadel of European Capitalism." The
+Government was forced to deal with a body that, for all practical
+purposes, was determining the foreign policy of the Empire. Behind that
+Council was an organized group of between six and seven millions of
+workers who were out to get the control of industry into their own
+hands, and to do it as speedily and as effectually as circumstances
+would permit.
+
+Meanwhile, the mantle of revolutionary activity descended upon Italy,
+where the red flag was run up over some the largest factories and some
+of the finest estates.
+
+Throughout the war, the revolutionary movement was strong in Italy. The
+Socialist Party remained consistently an anti-war party, with a radical
+and vigorous propaganda. The Armistice found the Socialist and Labor
+Movements strong in the North, with a growing movement in the South for
+the organization of Agricultural Leagues.
+
+The Socialist propaganda in Italy was very consistent and telling. The
+paper "Avanti," circulating in all parts of the country, was an agency
+of immense importance. The war, the Treaty, the rising cost of living,
+the growing taxation--all had prepared the ground for the work that the
+propagandists were doing. Their message was: "Make ready for the taking
+over of the industries! Learn what you can, so that, when the day comes,
+each will play his part. When you get the word, take over the works!
+There must be no violence--that only helps the other side. Do not linger
+on the streets, you will be shot. Remain at home or stay in the
+factories and work as you never worked before!"
+
+That, in essence, was the Italian Socialist propaganda--simple, clear
+and direct, and that was, in effect, what the workers did.
+
+The returned soldiers were a factor of large importance in the Italian
+Revolution. They were radicals throughout the war. The peace made them
+revolutionists. "The Proletarian League of the Great War" was affiliated
+with "The International of Former Soldiers," which comprised the radical
+elements among the ex-service men of Great Britain, Germany, France,
+Austria, Italy and a number of the smaller countries. There were over a
+million dues-paying members in this International, and their avowed
+object was propaganda against war and in favor of an economic system in
+which the workers control the industries. It was this group in
+Italy--particularly in the South--that carried through the project of
+occupying the estates.
+
+The workers are in control of the whole social fabric in Russia where
+the revolution has gone the farthest. In Great Britain, where the labor
+movement is perhaps more conservative than in any of the other countries
+of Europe, the Government is compelled to deal with a labor movement
+that is strong enough to consider and to decide important matters of
+foreign policy. The workers of Italy have the upper hand. In
+Czecho-Slovakia, in Bulgaria, in Germany and in the smaller and neutral
+countries the workers are making their voices heard in opposition to any
+restoration of the capitalist system; while they busy themselves with
+the task of creating the framework of a new society.
+
+
+4. _The Challenge_
+
+This is the challenge of the workers of Europe to the capitalist system.
+The workers are not satisfied; they are questioning. They mean to have
+the best that life has to give, and they are convinced that the
+capitalist system has denied it to them.
+
+The world has had more than a century of capitalism. The workers have
+had ample opportunity to see the system at work. The people of all the
+great capitalist countries--the common people--have borne the burdens
+and felt the crushing weight of capitalism--in its enslavement of little
+children; in its underpaying of women; in long hours of unremitting,
+monotonous toil; in the dreadful housing; in the starvation wages; in
+unemployment; in misery. The capitalist system has had a trial and it is
+upon the workers that the system has been tried out.
+
+During this experiment, the workers of the world have been compelled to
+accept poverty, unemployment and war.
+
+These terrible scourges have afflicted the capitalist world, and it is
+the workers and their families that have borne them in their own
+persons. In those countries where the capitalist system is the oldest,
+the workers have suffered the longest. The essence of capitalism is the
+exploitation of one man by another man, and the longer this exploitation
+is practiced the more skillful and effective does the master class
+become in its manipulation.
+
+The workers look before them along the path of capitalist imperialism
+that is now being followed by the nations that are in the lead of the
+capitalist world. There they see no promise save the same exploitation,
+the same poverty, the same inequality and the same wars over the
+commercial rivalries of the imperial nations.
+
+The workers of Europe have come to the conclusion that the world should
+belong to those who build it; that the good things of life should be the
+property of those who produce them. They see only one course open before
+them--to declare that those who will not work, shall not eat.
+
+The right of self-determination is the international expression of this
+challenge. The ownership of the job is its industrial equivalent.
+Together, the two ideas comprise the program of the more advanced
+workers in all of the great imperial countries of the world. These ideas
+did not originate in Russia, and they are not confined to Russia any
+more than capitalism is confined to Great Britain. They are the
+doctrines of the new order that is coming rapidly into its own.
+
+Capitalism has been summed up, heretofore, in the one word "profit." The
+capitalist cannot abandon that standard. The world has lived beyond it,
+however, and without it, capitalism, as a system, is meaningless. If the
+capitalists abandon profit, they abandon capitalism.
+
+Without profit the capitalist system falls to pieces, because it is the
+profit incentive that has always been considered as the binder that
+holds the capitalist world together. Hence the abandonment of the profit
+incentive is the surrender of the citadel of capitalism. While profit
+remains, exploitation persists, and while there is exploitation of one
+man by another, no human being can call himself free.
+
+The capitalists are caught in a beleaguered fortress in which they are
+defending their economic lives. Profit is the key to this fortress, and
+if they surrender the key, they are lost.
+
+
+5. _The Real Struggle_
+
+This is the real struggle for the possession of the earth. Shall the few
+own and the many labor for the few, or the many own, and labor upon jobs
+that they themselves possess? The struggle between the capitalist
+nations is incidental. The struggle between the owners of the world and
+the workers of the world is fundamental.
+
+If Great Britain wins in her conflict with the United States, her
+capitalists will continue to exploit the workers of Lancashire and
+Delhi. Her imperialists will continue their policy of world domination,
+subjugating peoples and utilizing their resources and their labor for
+the enrichment.
+
+If the United States wins in her struggle with Great of the bankers and
+traders of London. Britain, her capitalists will continue to exploit the
+workers of Pittsburg and San Juan. Her imperialists will continue their
+policy of world domination, subjugating the peoples of Latin American
+first, and then reaching out for the control over other parts of the
+earth.
+
+No matter what imperial nation may triumph in this struggle between the
+great nations for the right to exploit the weaker peoples and the choice
+resources, the struggle between capitalism and Socialism must be fought
+to a finish. If the capitalists win, the world will see the introduction
+of a new form of serfdom, more complete and more effective than the
+serfdom of Feudal Europe. If the Socialists win, the world enters upon a
+new cycle of development.
+
+
+
+
+XIX. THE AMERICAN WORKER AND WORLD EMPIRE
+
+
+1. _Gains and Losses_
+
+The American worker is a citizen of the richest country of the world.
+Resources are abundant. There is ample machinery to convert these gifts
+of nature into the things that men need for their food and clothing,
+their shelter, their education and their recreation. There is enough for
+all, and to spare, in the United States.
+
+But the American worker is not master of his own destinies. He must go
+to the owners of American capital--to the plutocrats--and from them he
+must secure the permission to earn a living; he must get a job.
+Therefore it is the capitalists and not the workers of the United States
+that are deciding its public policy at the present moment.
+
+The American capitalist is a member of one of the most powerful
+exploiting groups in the world. Behind him are the resources, productive
+machinery and surplus of the American Empire. Before him are the
+undeveloped resources of the backward countries. He has gained wealth
+and power by exploitation at home. He is destined to grow still richer
+and more powerful as he extends his organization for the purposes of
+exploitation abroad.
+
+The prospects of world empire are as alluring to the American capitalist
+as have been similar prospects to other exploiting classes throughout
+history. Empire has always been meat and drink to the rulers.
+
+The master class has much to gain through imperialism. The workers have
+even more to lose.
+
+The workers make up the great bulk of the American people. Fully
+seven-eighths (perhaps nine-tenths) of the adult inhabitants of the
+United States are wage earners, clerks and working farmers. All of the
+proprietors, officials, managers, directors, merchants (big and little),
+lawyers, doctors, preachers, teachers, and the remainder of the business
+and professional classes constitute not over 10 or 12 percent of the
+total adult population. The workers are the "plain people" who do not
+build empires any more than they make wars. If they were left to
+themselves, they would continue the pursuit of their daily affairs which
+takes most of their thought and energy--and be content to let their
+neighbors alone.
+
+
+2. _The Workers' Business_
+
+The mere fact that the workers are so busy with the routine of daily
+life is in itself a guarantee that they will mind their own business.
+The average worker is engaged, outside of working hours, with the duties
+of a family. His wife, if she has children, is thus employed for the
+greater portion of her time. Both are far too preoccupied to interfere
+with the like acts of other workers in some other portion of the world.
+Furthermore, their preoccupation with these necessary tasks gives them
+sympathy with those similarly at work elsewhere.
+
+The plain people of any country are ready to exercise even more than an
+ordinary amount of forbearance and patience rather than to be involved
+in warfare, which wipes out in a fortnight the advantages gained through
+years of patient industry.
+
+The workers have no more to gain from empire building than they have
+from war making, but they pay the price of both. Empire building and war
+making are Siamese twins. They are so intimately bound together that
+they cannot live apart. The empire builder--engaged in conquering and
+appropriating territory and in subjugating peoples--must have not only
+the force necessary to set up the empire, but also the force requisite
+to maintain it. Battleships and army corps are as essential to empires
+as mortar is to a brick wall. They are the expression of the organized
+might by which the empire is held together.
+
+The plain people are the bricks which the imperial class uses to build
+into a wall about the empire. They are the mortar also, for they man the
+ships and fill up the gaps in the infantry ranks and the losses in the
+machine gun corps. They are the body of the empire as the rulers are its
+guiding spirit.
+
+When ships are required to carry the surplus wealth of the ruling class
+into foreign markets, the workers build them. When surplus is needed to
+be utilized in taking advantage of some particularly attractive
+investment opportunity the workers create it. They lay down the keels of
+the fighting ships, and their sons aim and fire the guns. They are
+drafted into the army in time of war and their bodies are fed to the
+cannon which other workers in other countries, or perhaps in the same
+country, have made for just such purposes. The workers are the warp and
+woof of empire, yet they are not the gainers by it. Quite the contrary,
+they are merely the means by which their masters extend their dominion
+over other workers who have not yet been scientifically exploited.
+
+The work of empire building falls to the lot of the workers. The profits
+of empire building go to the exploiting class.
+
+
+3. _The British Workers_
+
+What advantage came to the workers of Rome from the Empire which their
+hands shaped and which their blood cemented together? Their masters took
+their farms, converted the small fields into great, slave-worked
+estates, and drove the husbandmen into the alleys and tenements of the
+city where they might eke out an existence as best they could. The
+rank-and-file Roman derived the same advantage from the Roman Empire
+that the rank-and-file Briton has derived from the British Empire.
+
+Great Britain has exercised more world mastery during the past hundred
+years than any other nation. All that Germany hoped to achieve Great
+Britain has realized. Her traders carry the world's commerce, her
+financiers clip profits from international business transactions, her
+manufacturers sell to the people of every country, the sun never sets on
+the British flag.
+
+Great Britain is the foremost exponent and practitioner of capitalist
+imperialism. The British Empire is the greatest that the world has known
+since the Empire of Rome fell to pieces. Whatever benefits modern
+imperialism brings either for capitalists or for workers should be
+enjoyed by the capitalists and workers of Great Britain.
+
+Until the Great World War the capitalists of Great Britain were the most
+powerful on earth with a larger foreign trade and a larger foreign
+investment than any other. At the same time the British workers were
+amongst the worst exploited of those in any capitalist country in
+Europe.
+
+The entire nineteenth century is one long and terrible record of
+master-class exploitation inside the British Isles. The miseries of
+modern India have been paralleled in the lives of the workers of
+Ireland, Scotland, Wales and England. Gibbins, in his description of the
+conditions of the child workers in the early years of the nineteenth
+century ends with the remark, "One dares not trust oneself to try and
+set down calmly all that might be told of this awful page of the history
+of industrial England."[58]
+
+Even more revolting are the descriptions of the conditions which
+surrounded the lives of the mine workers in the early part of the
+nineteenth century. Women as well as men were taken into the mines and
+in some cases, as the reports of the Parliamentary investigation show,
+the women dragged cars through passage-ways that were too low to admit
+the use of ponies or mules.
+
+England, mistress of the seas, proud carrier of the traffic of the
+world, the center of international finance, the richest among all the
+investing nations--England was reeking with poverty. Beside her
+factories and warehouses were vile slums in which people huddled as
+Ruskin said, "so many brace to a garret." There in the back alleys of
+civilization babies were born and babies died, while those who survived
+grew to the impotent manhood of the street hooligan.
+
+The British Empire girdled the world. For a century its power had grown,
+practically unchallenged. Superficially it had every appearance of
+strength and permanence but behind it and beneath it were the hundreds
+of thousands of exploited factory workers, the underpaid miners, the
+Cannon Gate of Edinburgh and the Waterloo Junction of London.
+
+Capitalist imperialism has not benefited the British workers. Quite the
+contrary, the rise of the Empire has been accompanied by the
+disappearance of the stalwart English yeoman; by the disappearance of
+the agricultural population; by the concentration of the people in huge
+industrial towns where the workers, no longer the masters of their own
+destinies, must earn their living by working at machines owned by the
+capitalist imperialists. The surplus derived from this exploited labor
+is utilized by the capitalists as the means of further extending their
+power in foreign lands.
+
+Imperialism has brought not prosperity, but poverty to the plain people
+of England.
+
+There is another aspect of the matter. If these degraded conditions
+attach to the workers in the center of the empire, what must be the
+situation among the workers in the dependencies that are the objects of
+imperial exploitation? Let the workers of India answer for Great
+Britain; the workers of Korea answer for Japan, and the workers of Porto
+Rico answer for the United States. Their lot is worse than is the lot of
+the workers at the center of imperial power.
+
+Empires yield profits to the masters and victory and glory to the
+workers. Let any one who does not believe this compare the lives of the
+workers in small countries like Holland, Norway, Denmark and
+Switzerland, with the lives of the workers in the neighboring
+empires--Russia, Germany, France and Great Britain. The advantage is all
+on the side of those who live in the smaller countries that are minding
+their own affairs and letting their neighbors alone.
+
+
+4. _The Long Trail_
+
+The workers of the United States are to-day following the lead of the
+most powerful group of financial imperialists in the world. The trail is
+a long one leading to world conquest, unimagined dizzying heights of
+world power, riches beyond the ken of the present generation, and then,
+the slow and terrible decay and dissolution that sooner or later
+overtake those peoples that follow the paths of empire. The rulers will
+wield the power and enjoy the riches. The people will struggle and
+suffer and pay the price.
+
+The American plutocracy is out to conquer the earth because it is to
+their interest to do so. The will-o'-the-wisp of world empire has
+captured their imaginations and they are following it blindly.
+
+The American people, on November 2, 1920, gave the American imperialists
+a blanket authority to go about their imperial business--an authority
+that the rulers will not be slow to follow. First they will clean house
+at home--that housecleaning will be called "the campaign for the
+establishment of the open shop." Then they will go into Mexico, Central
+America, China, and Europe in search of markets, trade and investment
+opportunities.
+
+Behind the investment will come the flag, carried by battle-ships and
+army divisions. That flag will be brought front to front with other
+flags, high words will be spoken, blood will flow, life will ebb, and
+the imperialists will win their point and pocket their profit.
+
+Behind them, in November, and at all other times of the year, there
+will be the will, expressed or implied, of the working people of the
+United States, who will produce the surplus for foreign investment; will
+make the ships and man them; will dig the coal and bore for the oil;
+will shape the machines. Their hands and the hands of their sons will be
+the force upon which the ruling class must depend for its power. They
+will produce, while the ruling class consumes and destroys.
+
+The trail is a long one, but it leads none the less certainly to,
+isolation and death. No people can follow the imperial trail and live.
+Their liberties go first and then their lives pay the penalty of their
+rulers' imperial ambition. It was so in the German Empire. It is so
+to-day in the British Empire. To-morrow, if the present course is
+followed, it will be equally true in the American Empire.
+
+
+5. _The New Germany_
+
+One of the chief charges against the Germans, in 1914, was that they
+were not willing to leave their neighbors in peace. They were out to
+conquer the world, and they did not care who knew it. It was not the
+German people who held these plans for world conquest, it was the German
+ruling class. The German people were quite willing to stay at home and
+attend to their own affairs. Their rulers, pushed by the need for
+markets and investment opportunities, and lured by the possibilities of
+a world empire, were willing to stake the lives and the happiness of the
+whole nation on the outcome of these ambitious schemes. They threw their
+dice in the great world game of international rivalries--threw and lost;
+but in their losing, they carried not only their own fortunes, but the
+lives and the homes and the happiness of millions of their fellows whose
+only desire was to remain at home and at peace.
+
+Germany's offense was her ambition to gain at the expense of her
+neighbors. Lacking a place in the sun, she proposed to take it by the
+strength of her good right arm. This is the method by which all of the
+great empires have been built and it is the method that the builders of
+the American Empire have followed up to this point. The land which the
+ruling class of the United States has needed has heretofore been in the
+hands of weak peoples--Indians, Mexicans, a broken Spanish Empire. Now,
+however, the time has come when the rulers of the United States, with
+the greatest wealth and the greatest available resources of any of the
+nations, are preparing to take what they want from the great nations,
+and that imperial purpose can be enforced in only one way--by a resort
+to arms. The rulers of the United States must take what they would have
+by force, from those who now possess it. They did not hesitate to take
+Panama from Colombia; they did not hesitate to take possession of Hayti
+and of Santo Domingo, and they do not propose to stop there.
+
+The people of the world know these things. The inhabitants of Latin
+America know them by bitter experience. The inhabitants of Europe and of
+Asia know them by hearsay. Both in the West and in the East, the United
+States is known as "The New Germany."
+
+That means that the peoples of these countries look upon the United
+States and her foreign policies in exactly the same way that the people
+of the United States were taught to regard Germany and her foreign
+policies. To them the United States is a great, rich, brutal Empire,
+setting her heel and laying her fist where necessity calls. Men and
+women inside the United States think of themselves and of their fellow
+citizens as human beings. The people in the other countries read the
+records of the lynchings, the robberies and the murders inside the
+United States; of the imperial aggression toward Latin America, and they
+are learning to believe that the United States is made up of ruthless
+conquerors who work their will on those that cross their path.
+
+The plain American men and women, living quietly in their simple homes,
+are none the less citizens of an aggressive, conquering Empire. They may
+not have a thought directed against the well-being of a single human
+creature, but they pay their taxes into the public treasury; they vote
+for imperialism on each election day; they read imperialism in their
+papers and hear it preached in their churches, and when the call comes,
+their sons will go to the front and shed their blood in the interest of
+the imperial class.
+
+The plain people of the German Empire did not desire to harm their
+fellows, nevertheless, they furnished the cannon-fodder for the Great
+War. America's plain folks, by merely following the doctrine, "My
+country, right or wrong--America first!" will find themselves, at no
+very distant date, exactly where the German people found themselves in
+1914.
+
+
+6. _The Price_
+
+The historic record, in the matter of empire, is uniform. The masters
+gain; the workers pay.
+
+The workers of the United States will not be exempt from these
+inexorable necessities of imperialism. On the contrary they will be
+called upon to pay the same price for empire that the workers in Britain
+have paid; that the workers in the other empires have paid. What is the
+price? What will world empire cost the American workers?
+
+1. It will cost them their liberties. An empire cannot be run by a
+debating society. Empires must act. In order to make this action mobile
+and efficacious, authority must be centered in the hands of a small
+group--the ruling class, whose will shall determine imperial policy.
+Self-government is inconsistent with imperialism.
+
+2. The workers will not only lose their own liberties, but they will be
+compelled to take liberties away from the peoples that are brought under
+the domination of the Empire. Self-determination is the direct opposite
+of imperialism.
+
+3. The American workers, as a part of the price of empire, will be
+compelled to produce surplus wealth--wealth which they can never
+consume; wealth the control of which passes into the hands of the
+imperial ruling class, to be invested by them in the organization of the
+Empire and the exploitation of the resources and other economic
+opportunities of the dependent territory.
+
+4. The American workers must be prepared to create and maintain an
+imperial class, whose function it is to determine the policies and
+direct the activities of the Empire. This class owes its existence to
+the existence of empire, without which such a ruling class would be
+wholly unnecessary.
+
+5. The American workers must be prepared, in peace time as well as in
+war time, to provide the "sinews of war": the fortifications, the battle
+fleet, the standing army and the vast naval and military equipment that
+invariably accompany empire.
+
+6. The American workers must furthermore be ready, at a moment's call,
+to turn from their occupations, drop their useful pursuits, accept
+service in the army or in the navy and fight for the preservation of the
+Empire--against those who attack from without, against those who seek
+the right of self-determination within.
+
+7. The American workers, in return for these sacrifices, must be
+prepared to accept the poverty of a subsistence wage; to give the best
+of their energies in war and in peace, and to stand aside while the
+imperial class enjoys the fat of the land.
+
+
+7. _A Way Out_
+
+If the United States follows the course of empire, the workers of the
+United States have no choice but to pay the price of Empire--pay it in
+wealth, in misery, and in blood. But there is an alternative. Instead of
+going on with the old system of the masters, the workers may establish a
+new economic system--a system belonging to the workers, and managed by
+them for their benefit.
+
+The workers of Europe have tried out imperialism and they have come to
+the conclusion that the cost is too high. Now they are seeking, through
+their own movement--the labor movement--to control and direct the
+economic life of Europe in the interest of those who produce the wealth
+and thus make the economic life of Europe possible.
+
+The American workers have the same opportunity. Will they avail
+themselves of it? The choice is in their hands.
+
+Thus far the workers of the United States have been, for the most part,
+content to live under the old system, so long as it paid them a living
+wage and offered them a job. The European workers felt that too in the
+pre-war days, but they have been compelled--by the terrible experiences
+of the past few years--to change their minds. It was no longer a
+question of wages or a job in Europe. It was a question of life or
+death.
+
+Can the American worker profit by that experience? Can he realize that
+he is living in a country whose rulers have adopted an imperial policy
+that threatens the peace of the world? Can he see that the pursuit of
+this policy means war, famine, disease, misery and death to millions in
+other countries as well as to the millions at home? The workers of
+Europe have learned the lesson by bitter experience. Is not the American
+worker wise enough to profit by their example?
+
+FOOTNOTE:
+
+[58] "Industry in England," H. deB. Gibbins. New York, Scribner's, 1897,
+p. 390.
+
+THE END
+
+
+
+
+INDEX.
+
+
+Advertising imperialism, 169
+
+America, conquest of, 27
+
+America first, 170
+
+America for Americans, 202
+
+American capitalists, 218
+   "          "       program of, 226
+   "     empire, costs of, 160
+   "        "    course of, 158
+   "        "    development of, 15
+   "        "    economic basis of, 74
+   "        "    growth of, 161
+   "     imperialism, 23
+   "     Indian, 29
+   "     industries, growth of, 178
+   "     people, ancestry, 159
+   "     protectorates, 207
+   "     Republic, disappearance of, 72
+   "     tradition, failure of, 12
+   "     worker and empire, 256
+
+Anti-imperialism, 68
+
+Appropriation of territory, 213
+
+Automobile distribution, 183
+
+
+Bankers, unity of, 150
+
+Bethlehem Steel Co., 132
+
+British Empire, gains of, 198
+   "       "    position of, 234
+   "    Labor, position of, 250
+
+Business control, 148
+
+
+Canada, investments in, 206
+
+Capitalism and Bolshevism, 244
+    "       "  war, 225
+    "      breakdown of, 248
+    "      law of, 223
+
+Cherokees, dealings with, 33
+
+Class government, 10
+  "   struggle, in Europe, 254
+
+Coal reserves, 180
+
+Cohesion of wealth, 86, 118
+
+Competition, ferocity of, 223
+
+Competitive industry, 75
+
+Conquering peoples, 26
+
+Conquest of the West, 49
+
+Council of Action, organization, 250
+   "    "  National Defense, 148
+
+Cuban independence, 66
+  "    treaty, 208
+
+
+Dictatorship, possibility of, 222
+
+Dominican Republic, relations with, 209
+
+
+Education for imperialism, 169
+
+Empire and British workers, 258
+  "    characteristics of, 15
+  "    definition of, 16
+  "    evolution of, 22
+  "    prevalence of, 17
+  "    price of, 20, 264
+  "    stages in, 19
+  "    workers and, 262
+
+Empires, the Big Four, 231
+
+Europe, financial breakdown, 249
+  "     revolution in, 246
+
+
+Financial imperialism, 135
+
+Foreign investments, 131
+
+France, gains of, 197
+
+
+Government and business, 99
+
+Great Peace, 36
+
+Great War, 143
+  "    "   advantages of, to the United States, 157
+  "    "   next incidents of, 235
+  "    "   results of, 240
+
+Guaranty Trust Company, 136
+
+
+Hawaii, annexation of, 62
+  "     revolution in, 63
+
+Hayti, conditions in, 210
+
+
+Immigrants, race of, 160
+
+Imperial alignment, 229
+    "    goal, 222
+    "    purpose, 165
+    "    sentiments, 166
+    "    task, 237
+    "      "   nature of, 228
+
+Imperialism, advantages of, 256
+     "       beginnings of, 65
+     "       challenge to, 243
+     "       cost of, 261
+     "       establishment of, 72
+     "       failure of, 243
+     "       psychology of, 170
+
+Imperialists, training of, 219
+
+Incomes, in the United States, 115
+
+Industrial combination, 81
+     "     organization, 78
+     "     revolution, 76
+
+International exploitation, 128
+      "       finance, 135
+      "       Harvester Co., 133
+
+Investing nations, 127
+
+Investment bankers, 86
+
+Investments in the United States, 130
+
+Italy, gains of, 197
+
+
+Job ownership, 94
+
+
+Labor, colonial shortage of, 38
+
+Landlordism, 105
+
+Land ownership, 103
+  "  policy, 104
+
+Latin America, 203
+
+Liberty, desire for, 8
+
+
+Manifest destiny, 171
+
+Mastery, avenues of, 92
+
+Mexican War, provocation of, 55
+   "     "   success of, 56
+
+Mexico, conquest of, 54
+
+Monroe Doctrine, 202
+   "       "     logic of, 207
+
+
+National City Bank, 138
+
+Navy League, 146
+
+Negro civilization, in Africa, 40
+  "   slaves, values of, 47
+
+Negroes, numbers enslaved, 43
+
+New Europe, 246
+
+Next War, contestants in, 236
+  "   "   preparations for, 241
+  "   "   pretexts for, 238
+
+New Orleans, struggle for, 50
+
+
+Ownership, advantages of, 114
+
+
+Panama, relations with, 213
+  "     revolution in, 215
+  "     seizure of, 214
+
+Patriotism, 147
+
+Peace Treaty, provisions of, 224
+  "      "    results of, 194
+
+Personal incomes, sources of, 116
+
+Philippines, conquest of, 69
+
+Plutocracy, 117
+     "      control of, 148
+     "      dictatorship of, 92
+     "      domestic power of, 153
+     "      economic gains of, 151
+     "      growing power of, 143
+
+Popular government, 9
+
+Population, increase of, 50
+
+Preparedness, 145
+
+Press censorship, 210
+
+Product ownership, 96
+
+Profiteering, 151
+
+Property, Indian ideas of, 30
+    "     ownership, security of, 107
+    "     rights, and civilization, 113
+    "     rights of, 103
+    "     safeguards to, 108
+
+Public opinion, control of, 98
+
+
+Resources of the United States, 179
+
+Revolution in Europe, 246
+
+Russia, Allied attack on, 245
+   "    world position of, 231
+
+
+Slave Coast, 39
+  "   power, defeat of, 61
+  "   trade, America's part in, 44
+  "     "    beginnings of, 39
+  "     "    conditions of, 43
+  "     "    development of, 42
+
+Slavery, and expansion, 60
+   "     beginnings of, 39
+   "     in the United States, 45
+
+Slaves, early demand for, 41
+
+Southwest, conquest of, 51, 57
+
+Sovereignty, source of, 11
+
+Spanish War, 65
+
+Standard Oil Co., 134
+
+Surplus, disposal of, 123
+   "     pressure of, 121
+
+
+Teutonic peoples, 26
+
+Texas, annexation of, 52
+
+Timber reserves, 180
+
+Transportation facilities, 183
+
+
+Undeveloped countries, 124
+
+United States, capital of, 181
+  "       "    financial power of, 154
+  "       "    past isolation, 192
+  "       "    position of, 221
+  "       "    products of, 184
+  "       "    resources of, 179
+  "       "    shipping, 188
+  "       "    wealth and income, 189
+  "       "    world attitude to, 263
+  "       "    world power of, 177
+
+
+Wealth and income, 189
+  "    of the United States, 89
+  "    ownership, 90
+
+Western Hemisphere, and the United States, 200
+
+World conquest, 218
+
+Workers' business, 257
+
+
+Yellow peril, 232
+
+
+
+***END OF THE PROJECT GUTENBERG EBOOK THE AMERICAN EMPIRE***
+
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+<meta http-equiv="Content-Type" content="text/html; charset=ISO-8859-1" />
+<title>The Project Gutenberg eBook of The American Empire, by Scott Nearing</title>
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+<body>
+<h1>The Project Gutenberg eBook of The American Empire, by Scott Nearing</h1>
+<pre>
+This eBook is for the use of anyone anywhere at no cost and with
+almost no restrictions whatsoever.  You may copy it, give it away or
+re-use it under the terms of the Project Gutenberg License included
+with this eBook or online at <a href = "http://www.gutenberg.org">www.gutenberg.org</a></pre>
+<p>Title: The American Empire</p>
+<p>Author: Scott Nearing</p>
+<p>Release Date: January 12, 2009  [eBook #27787]</p>
+<p>Language: English</p>
+<p>Character set encoding: ISO-8859-1</p>
+<p>***START OF THE PROJECT GUTENBERG EBOOK THE AMERICAN EMPIRE***</p>
+<p>&nbsp;</p>
+<h3>E-text prepared by Peter Vachuska, Martin Pettit,<br />
+    and the Project Gutenberg Online Distributed Proofreading Team<br />
+    (http://www.pgdp.net)</h3>
+<p>&nbsp;</p>
+<hr class="full" />
+<p>&nbsp;</p>
+<p>&nbsp;</p>
+<p>&nbsp;</p>
+
+<h1>THE AMERICAN<br />EMPIRE</h1>
+
+<p class="tbrk">&nbsp;</p>
+
+<h3><i>By</i></h3>
+
+<h2>SCOTT NEARING</h2>
+
+<h4><i>Author of<br />"Wages in the United States"<br />"Income"<br />"Financing the
+Wage-Earner's Family"<br />"Anthracite"<br />"Poverty and Riches," etc.</i></h4>
+
+<p class="tbrk">&nbsp;</p>
+
+<h4>NEW YORK<br />THE RAND SCHOOL OF SOCIAL SCIENCE<br />7 EAST 15TH STREET<br />1921</h4>
+
+<h4><i>All rights reserved</i></h4>
+
+<hr />
+
+<p class="tbrk">&nbsp;</p>
+
+<h4><i>Copyright, 1921</i>, <br />by the<br /><span class="smcap">Rand School of Social Science</span></h4>
+
+<h4>First Edition, January, 1921<br />Second Edition, February, 1921</h4>
+
+<p class="tbrk">&nbsp;</p>
+
+<hr />
+
+<h2>CONTENTS</h2>
+
+<h3>PART I<br /><br />WHAT IS AMERICA?</h3>
+
+<div class="index">
+<ul>
+<li><span class="mono">CHAPTER</span></li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#I_THE_PROMISE_OF_1776">I</a></span>&nbsp;&nbsp;The Promise of 1776</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#II_THE_COURSE_OF_EMPIRE">II</a></span>&nbsp;&nbsp;The Course of Empire</li>
+</ul>
+</div>
+
+<h3>PART II<br /><br />THE FOUNDATIONS OF EMPIRE.</h3>
+
+<h4>A. <span class="smcap">The Conquest of America.</span></h4>
+
+<div class="index">
+<ul>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;<a href="#III_SUBJUGATING_THE_INDIANS">III</a></span>&nbsp;&nbsp;Subjugating the Indians</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#IV_SLAVERY_FOR_A_RACE">IV</a></span>&nbsp;&nbsp;Slavery for a Race</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#V_THE_WINNING_OF_THE_WEST">V</a></span>&nbsp;&nbsp;Winning the West</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#VI_THE_BEGINNINGS_OF_WORLD_DOMINION">VI</a></span>&nbsp;&nbsp;The Beginnings of World Dominion</li>
+</ul>
+</div>
+
+<h4>B. <span class="smcap">Plutocracy.</span></h4>
+
+<div class="index">
+<ul>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;<a href="#VII_THE_STRUGGLE_FOR_WEALTH_AND_POWER">VII</a></span>&nbsp;&nbsp;The Struggle for Wealth and Power</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;<a href="#VIII_THEIR_UNITED_STATES">VIII</a></span>&nbsp;&nbsp;Their United States</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#IX_THE_DIVINE_RIGHT_OF_PROPERTY">IX</a></span>&nbsp;&nbsp;The Divine Right of Property</li>
+</ul>
+</div>
+
+<h3>PART III<br /><br />MANIFEST DESTINY.</h3>
+
+<div class="index">
+<ul>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#X_INDUSTRIAL_EMPIRES">X</a></span>&nbsp;&nbsp;Industrial Empires</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#XI_THE_GREAT_WAR">XI</a></span>&nbsp;&nbsp;The Great War</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;<a href="#XII_THE_IMPERIAL_HIGHROAD">XII</a></span>&nbsp;&nbsp;The Imperial Highroad</li>
+</ul>
+</div>
+
+<h3>PART IV<br /><br />THE UNITED STATES&mdash;A WORLD EMPIRE.</h3>
+
+<div class="index">
+<ul>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;<a href="#XIII_THE_UNITED_STATES_AS_A_WORLD_COMPETITOR">XIII</a></span>&nbsp;&nbsp;The United States as a World Competitor</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;<a href="#XIV_THE_PARTITION_OF_THE_EARTH">XIV</a></span>&nbsp;&nbsp;The Partition of the Earth</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<a href="#XV_PAN-AMERICANISM">XV</a></span>&nbsp;&nbsp;Pan-Americanism</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;<a href="#XVI_THE_AMERICAN_CAPITALISTS_AND_WORLD_EMPIRE">XVI</a></span>&nbsp;&nbsp;The American Capitalist and World Empire</li>
+</ul>
+</div>
+
+<h3>PART V<br /><br />THE CHALLENGE TO IMPERIALISM.</h3>
+
+<div class="index">
+<ul>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;<a href="#XVII_THE_NEW_IMPERIAL_ALIGNMENT">XVII</a></span>&nbsp;&nbsp;The New Imperial Alignment</li>
+<li><span class="mono">&nbsp;&nbsp;<a href="#XVIII_THE_CHALLENGE_TO_IMPERIALISM">XVIII</a></span>&nbsp;&nbsp;The Challenge in Europe</li>
+<li><span class="mono">&nbsp;&nbsp;&nbsp;&nbsp;<a href="#XIX_THE_AMERICAN_WORKER_AND_WORLD_EMPIRE">XIX</a></span>&nbsp;&nbsp;The American Worker and World Empire</li>
+</ul>
+</div>
+
+<h3><a href="#INDEX">INDEX</a></h3>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_7" id="Page_7">[Pg 7]</a></span></p>
+
+<h1>The American Empire</h1>
+
+<hr class="smler" />
+
+<h2><a name="I_THE_PROMISE_OF_1776" id="I_THE_PROMISE_OF_1776"></a>I. THE PROMISE OF 1776</h2>
+
+<h3>1. <i>The American Republic</i></h3>
+
+<p>The genius of revolution presided at the birth of the American Republic,
+whose first breath was drawn amid the economic, social and political
+turmoil of the eighteenth century. The voyaging and discovering of the
+three preceding centuries had destroyed European isolation and laid the
+foundation for a new world order of society. The Industrial Revolution
+was convulsing England and threatening to destroy the Feudal State.
+Western civilization, in the birthpangs of social revolution, produced
+first the American and then the French Republic.</p>
+
+<p>Feudalism was dying! Divine right, monarchy, aristocracy, oppression,
+despotism, tyranny&mdash;these and all other devils of the old world order
+were bound for the limbo which awaits outworn, discredited social
+institutions. The Declaration of Independence officially proclaimed the
+new order,&mdash;challenging "divine right" and maintaining that "all men are
+created equal; that they are endowed by their Creator with certain
+unalienable rights; that among these are life, liberty and the pursuit
+of happiness. That to secure these rights, governments are instituted
+among men, deriving their just powers from the consent of the governed."</p>
+
+<p>Life, liberty and happiness were the heritage of the human race, and
+"whenever any form of government becomes destructive of these ends, it
+is the right of the people to alter or abolish it, and to institute a
+new government laying its foundations on such principles, and organizing
+its<span class='pagenum'><a name="Page_8" id="Page_8">[Pg 8]</a></span> powers in such form, as to them shall seem likely to effect their
+safety and happiness."</p>
+
+<p>Thus the rights of the people were declared superior to the privileges
+of the rulers; revolution was justified; and the principles of
+eighteenth century individualism were made the foundation of the new
+political state. Aristocracy was swept aside and in its stead democracy
+was enthroned.</p>
+
+<h3>2. <i>The Yearning for Liberty</i></h3>
+
+<p>The nineteenth century re-echoed with the language of social idealism.
+Traditional bonds were breaking; men's minds were freed; their
+imaginations were kindled; their spirits were possessed by a gnawing
+hunger for justice and truth.</p>
+
+<p>Revolting millions shouted: "Liberty, Equality, Fraternity!" Sages
+mused; philosophers analyzed; prophets exhorted; statesmen organized
+toward this end.</p>
+
+<p>Men felt the fire of the new order burning in their vitals. It purged
+them. They looked into the eyes of their fellows and saw its reflection.
+Dreaming of liberty as a maiden dreams of her lover, humanity awoke
+suddenly, to find liberty on the threshold.</p>
+
+<p>Through the ages mankind has sought truth and justice. Vested interests
+have intervened. The powers of the established order have resisted, but
+the search has continued. That eternal vigilance and eternal sacrifice
+which are the price of liberty, are found wherever human society has
+left a record. At one point the forces of light seem to be winning. At
+another, liberty and truth are being ruthlessly crushed by the
+privileged masters of life. The struggle goes on&mdash;eternally.</p>
+
+<p>Liberty and justice are ideals that exist in the human heart, but they
+are none the less real. Indeed, they are in a sense more potent, lying
+thus in immortal embryo, than they could be as tangible institutions.
+Institutions<span class='pagenum'><a name="Page_9" id="Page_9">[Pg 9]</a></span> are brought into being, perfected, kept past their time of
+highest usefulness and finally discarded. The hopes of men spring
+eternally, spontaneously. They are the true social immortality.</p>
+
+<h3>3. <i>Government of the People</i></h3>
+
+<p>Feudalism as a means of organizing society had failed. The newly
+declared liberties were confided to the newly created state. It was
+political democracy upon which the founders of the Republic depended to
+make good the promise of 1776.</p>
+
+<p>The American colonists had fled to escape economic, political and
+religious tyranny in the mother countries. They had drunk the cup of its
+bitterness in the long contest with England over the rights of taxation,
+of commerce, of manufacture, and of local political control. They had
+their fill of a mastery built upon the special privilege of an
+aristocratic minority. It was liberty and justice they sought and
+democracy was the instrument that they selected to emancipate themselves
+from the old forms of privilege and to give to all an equal opportunity
+for life, liberty and the pursuit of happiness.</p>
+
+<p>Political democracy was to place the management of community business in
+the hands of the people&mdash;to give them liberty in the control of public
+affairs. The highest interest of democracy was to be the interest of the
+people. There could be no higher interest because the people were
+supreme. The people were to select the public servants; direct their
+activities; determine public policy; prescribe the law; demand its
+enforcement; and if need be assert their superior authority over any
+part of the government, not excepting the constitution.<a name="FNanchor_1_1" id="FNanchor_1_1"></a><a href="#Footnote_1_1" class="fnanchor">[1]</a></p>
+
+<p><span class='pagenum'><a name="Page_10" id="Page_10">[Pg 10]</a></span></p><p>Democracy, in politics, was based on the idea that public affairs could
+best be run by the public voice. However expert may be the hand that
+administers the laws, the hand and the heart that renders the final
+decision in large questions must belong to the public.<a name="FNanchor_2_2" id="FNanchor_2_2"></a><a href="#Footnote_2_2" class="fnanchor">[2]</a></p>
+
+<p>The people who laid the foundations for democracy in France and the
+United States feared tyranny. They and their ancestors had been, for
+centuries, the victims of governmental despotism. They were on their
+guard constantly against governmental aggression in any form. And they,
+therefore, placed the strictest limitations upon the powers that
+governments should enjoy.</p>
+
+<p>Special privilege government was run by a special class,&mdash;the hereditary
+aristocracy&mdash;in the interest and for the profit of that class. They held
+the wealth of the nation&mdash;the land&mdash;and lived comfortably upon its
+produce. They never worked&mdash;no gentleman could work and remain a
+gentleman. They carried on the affairs of the court&mdash;sometimes well,
+sometimes badly; maintained an extravagant scale of social life; built
+up a vicious system of secret international diplomacy; commanded in time
+of war, and at all times; levied rents and taxes which went very largely
+to increase their own comfort and better their own position in life. The
+machinery of government and the profits from government remained in the
+hands of this one class.</p>
+
+<p>Class government from its very nature could not be other than
+oppressive. "All hereditary government over a people is to them a
+species of slavery and representative government is freedom." "All
+hereditary government is in its nature tyranny.... To inherit a
+government is to inherit the people as if they were flocks and
+herds."<a name="FNanchor_3_3" id="FNanchor_3_3"></a><a href="#Footnote_3_3" class="fnanchor">[3]</a></p>
+
+<p><span class='pagenum'><a name="Page_11" id="Page_11">[Pg 11]</a></span></p>
+
+<h3>4. <i>The Source of Authority</i></h3>
+
+<p>The people were to be the source of authority in the new state. The
+citizen was to have a voice because he was an adult, capable of
+rendering judgment in the selection of public servants and in the
+determination of public policy.</p>
+
+<p>All through history there had been men into whose hands supreme power
+had been committed, who had carried this authority with an astounding
+degree of wisdom and integrity. For every one who had comported himself
+with such wisdom in the presence of supreme authority, there were a
+score, or more likely a hundred, who had used this power stupidly,
+foolishly, inefficiently, brutally or viciously.</p>
+
+<p>Few men are good enough or wise enough to keep their heads while they
+hold in their hands unlimited authority over their fellows. The pages of
+human experience were written full of the errors, failures, and abuses
+of which such men so often have been guilty.</p>
+
+<p>The new society, in an effort to prevent just such transgressions of
+social well being, placed the final power to decide public questions in
+the hands of the people. It was not contended, or even hoped that the
+people would make no mistakes, but that the people would make fewer
+mistakes and mistakes less destructive of public well-being than had
+been made under class government. At least this much was gained, that
+the one who abused power must first secure it from those whom he
+proposed to abuse, and must later exercise it unrestrained to the
+detriment of those from whom the power was derived and in whom it still
+resided.</p>
+
+<p>The citizen was to be the source of authority. His word, combined with
+that of the majority of his fellows, was final. He delegated authority.
+He assented to laws which were administered over all men, including
+himself. He accepts the authority of which he was the source.</p>
+
+<p><span class='pagenum'><a name="Page_12" id="Page_12">[Pg 12]</a></span></p>
+
+<h3>5. <i>The American Tradition</i></h3>
+
+<p>This was the American tradition. This was the language of the new, free
+world. Life, liberty and happiness; popular sovereignty; equal
+opportunity. This, to the people of the old countries was the meaning of
+America. This was the promise of 1776.</p>
+
+<p>When President Wilson went to Europe, speaking the language of liberty
+that is taught in every American schoolroom, the plain people turned to
+him with supreme confidence. To them he was the embodiment of the spirit
+of the West.</p>
+
+<p>Native-born Americans hold the same idea. To them the Declaration of
+Independence was a final break with the old order of monarchical,
+imperial Europe. It was the charter of popular rights and human
+liberties, establishing once for all the principles of self-government
+and equal opportunity.</p>
+
+<p>The Statue of Liberty, guarding the great port of entrance to America,
+symbolizes the spirit in which foreigners and natives alike think of
+her&mdash;as the champion of the weak and the oppressed; the guardian of
+justice; the standard-bearer of freedom.</p>
+
+<p>This spirit of America is treasured to-day in the hearts of millions of
+her citizens. To the masses of the American people America stands to-day
+as she always stood. They believe in her freedom; they boast of her
+liberties; they have faith in her great destiny as the leader of an
+emancipated world. They respond, as did their ancestors, to the great
+truths of liberty, equality, and fraternity that inspired the eighteenth
+century.</p>
+
+<p>The tradition of America is a hope, a faith, a conviction, a burning
+endeavor, centering in an ideal of liberty and justice for the human
+race.</p>
+
+<p>Patrick Henry voiced this ideal when, a passionate appeal for freedom
+being interrupted by cries of "Treason,<span class='pagenum'><a name="Page_13" id="Page_13">[Pg 13]</a></span> treason!" he faced the objector
+with the declaration, "If this be treason, make the most of it!"</p>
+
+<p>Eighteenth century Europe, struggling against religious and political
+tyranny, looked to America as the land of Freedom. America to them meant
+liberty. "What Athens was in miniature, America will be in magnitude,"
+wrote Tom Paine. "The one was the wonder of the ancient world; the other
+is becoming the admiration, the model of the present." ("The Rights of
+Man," Part II, Chapter 3.) The promise of 1776 was voiced by men who
+felt a consuming passion for freedom; a divine discontent with anything
+less than the highest possible justice; a hatred of tyranny, oppression
+and every form of special privilege and vested wrong. They yearned over
+the future and hoped grandly for the human race.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_1_1" id="Footnote_1_1"></a><a href="#FNanchor_1_1"><span class="label">[1]</span></a> "It is, Sir, the people's constitution, the people's
+government, made for the people, made by the people, and answerable to
+the people."&mdash;Daniel Webster's reply to Hayne, 1830. "Speeches and
+Orations." E. P. Whipple, Boston, Little, Brown and Co., p. 257.</p></div>
+
+<div class="footnote"><p><a name="Footnote_2_2" id="Footnote_2_2"></a><a href="#FNanchor_2_2"><span class="label">[2]</span></a> Tom Paine held ardently to this doctrine, "It is always the
+interest of a far greater number of people in a Nation to have things
+right than to let them remain wrong; and when public matters are open to
+debate, and the public judgment free, it will not decide wrong unless it
+decides too hastily!" "Rights of Man," Part II, Ch. 4.</p></div>
+
+<div class="footnote"><p><a name="Footnote_3_3" id="Footnote_3_3"></a><a href="#FNanchor_3_3"><span class="label">[3]</span></a> "Rights of Man," Thomas Paine. Part II, Chapter 3.</p></div>
+</div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_14" id="Page_14">[Pg 14]</a></span></p>
+
+<h2><a name="II_THE_COURSE_OF_EMPIRE" id="II_THE_COURSE_OF_EMPIRE"></a>II. THE COURSE OF EMPIRE</h2>
+
+<h3>1. <i>Promise and Fulfillment</i></h3>
+
+<p>A vast gulf yawns between the inspiring promise that a handful of men
+and women made to the world in 1776, and the fulfillment of that promise
+that is embodied in twentieth century American life. The pre-war
+indifference to the loss of liberty; the gradual encroachments on the
+rights of free speech, and free assemblage and of free press; the
+war-time suppressions, tyrannies, and denials of justice; the subsequent
+activities of city, state, and national legislatures and executives in
+passing and enforcing laws that provided for military training in
+violation of conscience, the denial of freedom of belief, of thought, of
+speech, of press and of assemblage,&mdash;activities directed specifically to
+the negation of those very principles of liberty which have constituted
+so intimate a part of the American tradition of freedom,&mdash;form a
+contrast between the promise of 1776 and the twentieth century
+fulfillment of that promise which is brutal in its terrible intensity.</p>
+
+<p>Many thoughtful Americans have been baffled by this conflict between the
+aims of the eighteenth century and the accomplishments of the twentieth.
+The facts they admit. For explanation, either they may say, "It was the
+war," implying that with the cessation of hostilities and the return to
+a peace basis, the situation has undergone a radical change; or else
+they blame some individual or some organization for the extinction of
+American liberties.</p>
+
+<p>Great consequences arise from great causes. A general break-down of
+liberties cannot be attributed to individual caprice nor to a particular
+legislative or judicial act.</p>
+
+<p>The denial of liberty in the United States is a matter of large import.
+No mayor, governor, president, legislature, court, magnate, banker,
+corporation or trust, and<span class='pagenum'><a name="Page_15" id="Page_15">[Pg 15]</a></span> no combination of these individuals and
+organizations could arbitrarily destroy the American Republic.
+Underneath personality and partisanship are working the forces which
+have stripped the American people of their essential liberties as the
+April sun strips the mountains of their snow.</p>
+
+<p>No one can read the history of the United States since the drafting of
+the Declaration of Independence without being struck by the complete
+transformation in the forms of American life. The Industrial Revolution
+which had gripped England for half a century, made itself felt in the
+United States after 1815. Steam, transportation, industrial development,
+city life, business organization, expansion across the continent&mdash;these
+are the factors that have made of the United States a nation utterly
+apart from the nation of which those who signed the Declaration of
+Independence and fought the Revolution dreamed.</p>
+
+<p>These economic changes have brought political changes. The American
+Republic has been thrust aside. Above its remains towers a mighty
+imperial structure,&mdash;the world of business,&mdash;bulwarked by usage and
+convention; safeguarded by legislation, judicial interpretation, and the
+whole power of organized society. That structure is the American
+Empire&mdash;as real to-day as the Roman Empire in the days of Julius Caesar;
+the French Empire under the Little Corporal, or the British Empire of
+the Great Commoner, William E. Gladstone.</p>
+
+<p>Approved or disapproved; exalted or condemned; the fact of empire must
+be evident even to the hasty observer. The student, tracing its
+ramifications, realizes that the structure has been building for
+generations.</p>
+
+<h3>2. <i>The Characteristics of Empire</i></h3>
+
+<p>Many minds will refuse to accept the term "empire" as applied to a
+republic. Accustomed to link "empire" with "emperor," they conceive of a
+supreme hereditary ruler as an essential part of imperial life. A little
+<span class='pagenum'><a name="Page_16" id="Page_16">[Pg 16]</a></span>reflection will show the inadequacy of such a concept. "The British
+Empire" is an official term, used by the British Government, although
+Great Britain is a limited monarchy, whose king has less power than the
+President of the United States. On the other hand, eastern potentates,
+who exercise absolute sway over their tiny dominions do not rule
+"empires."</p>
+
+<p>Recent usage has given the term "empire" a very definite meaning, which
+refers, not to an "emperor" but to certain relations between the parts
+of a political or even of an economic organization. The earlier uses of
+the word "empire" were, of course, largely political. Even in that
+political sense, however, an "empire" does not necessarily imply the
+domain of an "emperor."</p>
+
+<p>According to the definition appearing in the "New English Dictionary"
+wherever "supreme and extensive political dominion" is exercised "by a
+sovereign state over its dependencies" an empire exists. The empire is
+"an aggregation of subject territories ruled over by a sovereign state."
+The terms of the definition are political, but it leaves the emperor
+entirely out of account and makes an empire primarily a matter of
+organization and not of personality.</p>
+
+<p>During the last fifty years colonialism, the search for foreign markets,
+and the competition for the control of "undeveloped" countries has
+brought the words "empire" and "imperialism" into a new category, where
+they relate, not to the ruler&mdash;be he King or Emperor&mdash;but to the
+extension of commercial and economic interests. The "financial
+imperialism" of F. C. Howe and the "imperialism" of J. A. Hobson are
+primarily economic and only incidentally political.</p>
+
+<p>"Empire" conveys the idea of widespread authority, dominion, rule,
+subjugation. Formerly it referred to political power; to-day it refers
+to economic power. In either case the characteristics of empire are,&mdash;</p>
+
+<blockquote><p>1. Conquered territory.</p>
+
+<p><span class='pagenum'><a name="Page_17" id="Page_17">[Pg 17]</a></span></p><p>2. Subject peoples.</p>
+
+<p>3. An imperial or ruling class.</p>
+
+<p>4. The exploitation of the subject peoples and the conquered
+territory for the benefit of the ruling class.</p></blockquote>
+
+<p>Wherever these four characteristics of imperial organization exist,
+there is an empire, in all of its essential features. They are the
+acid-test, by which the presence of empire may be determined.</p>
+
+<p>Names count for nothing. Rome was an empire, while she still called
+herself a republic. Napoleon carried on his imperial activities for
+years under the authority of Republican France. The existence of an
+empire depends, not upon the presence of an "emperor" but upon the
+presence of those facts which constitute Empire,&mdash;conquered territory;
+subject peoples; an imperial class; exploitation by and for this class.
+If these facts exist in Russia, Russia is an empire; if they are found
+in Germany, Germany is an empire; if they appear in the United States,
+the United States is an empire none the less surely,&mdash;traditions,
+aspirations and public conviction to the contrary notwithstanding.</p>
+
+<h3>3. <i>The Preservation of Empire</i></h3>
+
+<p>The first business of an imperial class is the preservation of the
+empire to which it owes its advantages and privileges. Therefore, in its
+very essence, imperialism is opposed to popular government. "The
+greatest good to the greatest number" is the ideal that directs the life
+of a self-governing community. "The safety and happiness of the ruling
+class" is the first principle of imperial organization.</p>
+
+<p>Imperialism is so generally recognized and so widely accepted as a
+mortal foe of popular government that the members of an imperial class,
+just rising into power, are always careful to keep the masses of the
+people ignorant of<span class='pagenum'><a name="Page_18" id="Page_18">[Pg 18]</a></span> the true course of events. This necessity explains
+the long period, in the history of many great empires, when the name and
+forms of democracy were preserved, after the imperial structure had been
+established on solid foundations. Slow changes, carefully directed and
+well disguised, are necessary to prevent outraged peoples from rising
+against an imperial order when they discover how they have been sold
+into slavery. Even with all of the safeguards, under the control of the
+ablest statesmen, Caesar frequently meets his Brutus.</p>
+
+<p>The love of justice; the yearning for liberty; the sense of fair play;
+the desire to extend opportunity, all operate powerfully upon those to
+whom the principles of self-government are dearest, leading them to
+sacrifice position, economic advantage, and sometimes life itself for
+the sake of the principles to which they have pledged their faith.</p>
+
+<p>Therein lies what is perhaps one of the most essential differences
+between popular government and empire. The former rests upon certain
+ideas of popular rights and liberties. The latter is a weapon of
+exploitation in the hands of the ruling class. Popular government lies
+in the hopes and beliefs of the people. Empire is the servant of
+ambition and the shadow of greed. Popular government has been evolved by
+the human race at an immense sacrifice during centuries of struggle
+against the forms and ideas that underly imperialism. Since men have set
+their backs on the past and turned their faces with resolute hope to the
+future, empire has repelled them, while democracy has called and
+beckoned.</p>
+
+<p>Empires have been made possible by "bread and circuses"; by appealing to
+an abnormally developed sense of patriotism; by the rule of might where
+largess and cajolery have failed. Rome, Germany and Britain are
+excellent examples of these three methods. In each case, millions of
+citizens have had faith in the empire, believing in its promise of glory
+and of victory; but on the other hand, this belief could be maintained
+only by a continuous propaganda&mdash;triumphs in Rome, school-books and
+"boilerplate"<span class='pagenum'><a name="Page_19" id="Page_19">[Pg 19]</a></span> in Germany and England. Even then, the imperial class is
+none too secure in its privileges. Always from the abysses of popular
+discontent, there arises some Spartacus, some Liebknecht, some Smillie,
+crying that "the future belongs to the people."</p>
+
+<p>The imperial class, its privileges unceasingly threatened by the popular
+love of freedom&mdash;devotes not a little attention to the problem of
+"preserving law and order" by suppressing those who speak in the name of
+liberty, and by carrying on a generous advertising campaign, the object
+of which is to persuade the people of the advantages which they derive
+from imperial rule.</p>
+
+<p>During the earlier stages in the development of empire, the imperial
+class is able to keep itself and its designs in the background. As time
+passes, however, the power of the imperialist becomes more and more
+evident, until some great crisis forces the empire builders to step out
+into the open. They then appear as the frank apologists, spokesmen and
+defenders of the order for which they have so faithfully labored and
+from which they expect to gain so much.</p>
+
+<p>Finally, the ambition of some aggressive leader among the imperialists,
+or a crisis in the affairs of the empire leads to the next step&mdash;the
+appointment of a "dictator," "supreme ruler" or "emperor." This is the
+last act of the imperial drama. Henceforth, the imperial class divides
+its attention between,&mdash;</p>
+
+<blockquote><p>1. The suppression of agitation and revolt among the people at
+home;</p>
+
+<p>2. Maintaining the imperial sway over conquered territory;</p>
+
+<p>3. Extending the boundaries of the empire and</p>
+
+<p>4. The unending struggle between contending factions of the ruling
+class for the right to carry on the work of exploitation at home
+and abroad.</p></blockquote>
+
+<p><span class='pagenum'><a name="Page_20" id="Page_20">[Pg 20]</a></span></p>
+
+<h3>4. <i>The Price of Empire</i></h3>
+
+<p>Since the imperial or ruling class is willing to go to any lengths in
+order to preserve the empire upon which its privileges depend, it
+follows that the price of empire must be reckoned in the losses that the
+masses of the people suffer while safeguarding the privileges of the
+few.</p>
+
+<p>As a matter of course, conquered and dependent people pay with their
+liberty for their incorporation into the empire that holds dominion over
+them. On any other basis, empire is unthinkable. Indeed the terms
+"dependencies," "domination," and "subject" carry with them only one
+possible implication&mdash;the subordination or extinction of the liberties
+of the peoples in question.</p>
+
+<p>The imperial class&mdash;a minority&mdash;depends for its continued supremacy upon
+the ownership of some form of property, whether this property be slaves,
+or land, or industrial capital. As Veblen puts it: "The emergence of the
+leisure class coincides with the beginning of ownership." ("Theory of
+the Leisure Class," T. Veblen, New York. B. W. Huebsch, 1899, p. 22.)
+Necessarily, therefore, the imperial class will sacrifice the so-called
+human or personal rights of the home population to the protection of its
+property rights. Indeed the property rights come to be regarded as the
+essential human rights, although there is but a small minority of the
+community that can boast of the possession of property.</p>
+
+<p>The superiority of ruling class property rights over the personal rights
+and liberties of the inhabitants in a subject territory is taken as a
+matter of course. Even in the home country, where the issue is clearly
+made, the imperial class will sacrifice the happiness, the health, the
+longevity, and the lives of the propertyless class in the interest of
+"law and order" and "the protection of property." The stories of the
+Roman populace; of the French peasants under Louis XIV; of the English
+factory workers (men, women and children) during the past hundred years,
+and of the low skilled workers in the United States since the Civil
+War,<span class='pagenum'><a name="Page_21" id="Page_21">[Pg 21]</a></span> furnish ample proof of the correctness of this contention. The
+life, liberty and happiness of the individual citizen is a matter of
+small importance so long as the empire is saved.</p>
+
+<p>A crisis in imperial affairs is always regarded, by the ruling class, as
+a legitimate reason for curtailing the rights of the people. Under
+ordinary circumstances, the imperial class will gain rather than lose
+from the exercise of "popular liberties." Indeed, the exercise of these
+liberties is of the greatest assistance in convincing the people that
+they are enjoying freedom and thus keeping them satisfied with their
+lot. But in a period of turmoil, with men's hearts stirred, and their
+souls aflamed with conviction and idealism, there is always danger that
+the people may exercise their "unalienable right" to "alter or abolish"
+their form of government. Consequently, during a crisis, the imperial
+class takes temporary charge of popular liberties. Every great empire
+engaged in the recent war passed through such an experience. In each
+country the ruling class announced that the war was a matter of life and
+death. Papers were suppressed or censored; free speech was denied; men
+were conscripted against will and conscience; constitutions were thrust
+aside; laws "slumbered"; writers and thinkers were jailed for their
+opinions; food was rationed; industries were controlled&mdash;all in the
+interest of "winning the war." After the war was won, the victors
+practiced an even more rigorous suppression while they were "making the
+peace." Then followed months and years of protests and demands, until,
+one by one, the liberties were retaken by the people or else the
+war-tyranny, once firmly established, became a part of "the heritage of
+empire." In such cases, where liberties were not regained, the plain
+people learned to do without them.</p>
+
+<p>Liberty is the price of empire. Imperialism presupposes that the people
+will be willing, at any time, to surrender their "rights" at the call of the rulers.</p>
+
+<p><span class='pagenum'><a name="Page_22" id="Page_22">[Pg 22]</a></span></p>
+
+<h3>5. <i>The Universality of Empire</i></h3>
+
+<p>Imperialism is not new, nor is it confined to one nation or to one race.
+On the contrary it is as old as history and as wide as the world.</p>
+
+<p>Before Rome, there was Carthage. Before Carthage, there were Greece,
+Macedonia, Egypt, Assyria, China. Where history has a record, it is a
+record of empire.</p>
+
+<p>During modern times, international affairs have been dominated by
+empires. The great war was a war between empires. During the first three
+years, the two chief contestants were the British Empire on the one hand
+and the German Empire on the other. Behind these leaders were the
+Russian Empire, the Italian Empire, the French Empire, and the Japanese
+Empire.</p>
+
+<p>The Peace of Versailles was a peace between empires. Five empires
+dominated the peace table&mdash;Great Britain, France, Italy, Japan and the
+United States. The avowedly anti-imperial nations of Europe&mdash;Russia and
+Hungary&mdash;were not only excluded from the deliberations of the Peace
+Table, but were made the object of constant diplomatic, military and
+economic aggression by the leading imperialist nations.</p>
+
+<h3>6. <i>The Evolution of Empire</i></h3>
+
+<p>Empires do not spring, full grown, from the surroundings of some great
+historic crisis. Rather they, like all other social institutions, are
+the result of a long series of changes that lead by degrees from the
+pre-imperial to the imperial stage. Many of the great empires of the
+past two thousand years have begun as republics, or, as they are
+sometimes called, "democracies," and the processes of transformation
+from the republican to the imperial stage have been so gradual that the
+great mass of the people were not aware that any change had occurred
+until the emperor ascended the throne.</p>
+
+<p><span class='pagenum'><a name="Page_23" id="Page_23">[Pg 23]</a></span></p><p>The development of empire is of necessity a slow process. There are the
+dependent people to be subjected; the territory to conquered; the
+imperial class to be built up. This last process takes, perhaps, more
+time than either of the other two. Class consciousness is not created in
+a day. It requires long experience with the exercise of imperial power
+before the time has come to proclaim an emperor, and forcibly to take
+possession of the machinery of public affairs.</p>
+
+<h3>7. <i>The United States and the Stages of Empire</i></h3>
+
+<p>Any one who is familiar with its history will realize at once that the
+United States is passing through some of the more advanced stages in the
+development of empire. The name "Republic" still remains; the traditions
+of the Republic are cherished by millions; the republican forms are
+almost intact, but the relations of the United States to its conquered
+territory and its subject peoples; the rapid maturation of the
+plutocracy as a governing class or caste; the shamelessness of the
+exploitation in which the rulers have indulged; and the character of the
+forces that are now shaping public policy, proclaim to all the world the
+fact of empire.</p>
+
+<p>The chief characteristics of empire exist in the United States. Here are
+conquered territory; subject peoples; an imperial, ruling class, and the
+exploitation by that class of the people at home and abroad. During
+generations the processes of empire have been working, unobserved, in
+the United States. Through more than two centuries the American people
+have been busily laying the foundations and erecting the imperial
+structure. For the most part, they have been unconscious of the work
+that they were doing, as the dock laborer, is ordinarily unconscious of
+his part in the mechanism of industry. Consciously or unconsciously, the
+American people have reared the imperial structure, until it stands,
+to-day, imposing in its grandeur, upon the spot where many of the
+founders of the American government hoped to see a republic.</p>
+
+<p><span class='pagenum'><a name="Page_24" id="Page_24">[Pg 24]</a></span></p><p>The entrance of the United States into the war did not greatly alter
+the character of the forces at work, nor did it in any large degree
+change the direction in which the country was moving. Rather, it brought
+to the surface of public attention factors of American life that had
+been evolving unnoticed, for generations.</p>
+
+<p>The world situation created by the war compelled the American imperial
+class to come out in the open and to occupy a position that, while
+wholly inconsistent with the traditions of American life, is
+nevertheless in keeping with the demands of imperial necessity. The
+ruling class in the United States has taken a logical step and has made
+a logical stand. The masters of American life have done the only thing
+that they could do in the interests of the imperial forces that they
+represent. They are the victims, as much as were the Kaiser and the Czar
+on the one hand, and the Belgians and the Serbs on the other, of that
+imperial necessity that knows no law save the preservation of its own
+most sacred interests.</p>
+
+<p>Certain liberal American thinkers have taken the stand that the
+incidents of 1917-1918 were the result of the failure of the President,
+and of certain of his advisers, to follow the theories which he had
+enunciated, and to stand by the cause that he had espoused. These
+critics overlook the incidental character of the war as a factor in
+American domestic policy. The war never assumed anything like the
+importance in the United States that it did among the European
+belligerents. On the surface, it created a furore, but underneath the
+big fact staring the administration in the face was the united front of
+the business interests, and their organized demands for action. The
+far-seeing among the business men realized that the plutocratic
+structure the world over was in peril, and that the fate of the whole
+imperial r&eacute;gime was involved in the European struggle. The Russian
+Revolution of March 1917 was the last straw. From that time on the
+entrance of the United States into the war became a certainty as the
+only means of "saving (capitalist) civilization."</p>
+
+<p><span class='pagenum'><a name="Page_25" id="Page_25">[Pg 25]</a></span></p><p>The thoughtful student of the situation in the United States is not
+deceived by personalities and names. He realizes that the events of
+1917-1918 have behind them generations of causes which lead logically to
+just such results; that he is witnessing one phase of a great process in
+the life of the American nation&mdash;a process that is old in its principles
+yet ever new in its manifestations.</p>
+
+<p>Traditional liberties have always given way before imperial necessity.
+An examination of the situation in which the ruling class of the United
+States found itself in 1917, and of the forces that were operating to
+determine public policy, must convince even the enthusiast that the
+occurrences of 1917 and the succeeding years were the logical outcome of
+imperial necessity. To what extent that explanation will account for the
+discrepancy between the promise of 1776 and the twentieth century
+fulfillment of that promise must appear from a further examination of
+the evidence.</p>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_26" id="Page_26">[Pg 26]</a></span></p>
+
+<h2><a name="III_SUBJUGATING_THE_INDIANS" id="III_SUBJUGATING_THE_INDIANS"></a>III. SUBJUGATING THE INDIANS</h2>
+
+<h3>1. <i>The Conquering Peoples</i></h3>
+
+<p>The first step in the establishment of empire&mdash;the conquest of territory
+and the subjugation of the conquered populations,&mdash;was taken by the
+people of the United States at the time of their earliest settlements.
+They took the step naturally, unaffectedly, as became the sons of their
+fathers.</p>
+
+<p>The Spanish, French, and English who made the first settlement in North
+America were direct descendants of the tribes that have swept across
+Europe and portions of Asia during the past three or four thousand
+years. These tribes, grouped on the basis of similarity in language
+under the general term "Aryan," hold a record of conquest that fills the
+pages of written history.</p>
+
+<p>Hunger; the pressure of surplus population; the inrush of new hordes of
+invaders, drove them on. Ambition; the love of adventure; the lure of
+new opportunities in new lands, called them further. Meliorism,&mdash;the
+desire to better the conditions of life for themselves and for their
+children&mdash;animated them. In later years the necessity of disposing of
+surplus wealth impelled them. Driven, lured, coerced, these Aryan tribes
+have inundated the earth. Passing beyond the boundaries of Europe, they
+have crossed the seas into Africa, Asia, America and Australia.</p>
+
+<p>Among the Aryans, after bitter strife, the Teutons have attained
+supremacy. The "Teutonic Peoples" are "the English speaking inhabitants
+of the British Isles, the German speaking inhabitants of Germany,
+Austria-Hungary and Switzerland, the Flemish speaking inhabitants of
+Belgium, the Scandinavian inhabitants of Sweden and Norway and
+practically all of the inhabitants of Holland and Denmark."
+("Encyclopedia Britannica.")</p>
+
+<p><span class='pagenum'><a name="Page_27" id="Page_27">[Pg 27]</a></span></p><p>This Teutonic domination has been established only by the bitterest of
+struggles. During the time when North America was being settled, the
+English dispossessed first the Spanish and later the French. Since the
+Battle of Waterloo&mdash;won by English and German troops; and the Crimean
+War&mdash;won by British against Russian troops&mdash;the Teutonic power has gone
+unchallenged and so it remains to-day.</p>
+
+<p>The dominant power in the United States for nearly two centuries has
+been the English speaking power. Thus the Americans draw their
+inspiration, not only from the Aryan, but from the English speaking
+Teutons&mdash;the most aggressive and dominating group among the Aryans.</p>
+
+<p>Three hundred years ago the title to North America was claimed by Spain,
+France and Great Britain. The land itself was almost entirely in the
+hands of Indian tribes which held the possession that according to the
+proverb, is "nine points of the law."</p>
+
+<p>The period of American settlement has witnessed the rapid dispossession
+of the original holders, until, at the present time, the Indians have
+less than two per cent of the land area of the United States.<a name="FNanchor_4_4" id="FNanchor_4_4"></a><a href="#Footnote_4_4" class="fnanchor">[4]</a></p>
+
+<p>The conquest, by the English speaking whites, of the three million
+square miles which comprise the United States has been accomplished in a
+phenomenally short space of time. Migration; military occupation;
+appropriation of the lands taken from the "enemy;" settlement, and
+permanent exploitation&mdash;through all these stages of conquest the country
+has moved.</p>
+
+<p>The "Historical Register of the United States Army" (F. B. Heitman,
+Washington, Govt. Print., 1903, vol. 2, pp. 298-300) contains a list of
+114 wars in which the United States has been engaged since 1775. The
+publication likewise presents a list of 8600 battles and engagements
+incident<span class='pagenum'><a name="Page_28" id="Page_28">[Pg 28]</a></span> to these 114 wars. Two of these wars were with England, one
+with Mexico and one with Spain. These, together with the Civil War and
+the War with Germany, constitute the major struggles in which the United
+States has been engaged. In addition to these six great wars there were
+the numerous wars with the Indians, the last of which (with the
+Chippewa) occurred in 1898. Some of these Indian "wars" were mere
+policing expeditions. Others, like the wars with the Northwest Indians,
+with the Seminoles and with the Apaches, lasted for years and involved a
+considerable outlay of life and money.</p>
+
+<p>When the Indian Wars were ended, and the handful of red men had been
+crushed by the white millions, the American Indians, once possessors of
+a hunting ground that stretched across the continent, found themselves
+in reservations, under government tutelage, or else, abandoning their
+own customs and habits of life, they accepted the "pale-face" standards
+in preference to their own well-loved traditions.</p>
+
+<p>The territory flanking the Mississippi Valley, with its coastal plains
+and the deposits of mineral wealth, is one of the richest in the world.
+Only two other areas, China and Russia, can compare with it in
+resources.</p>
+
+<p>This garden spot came into the possession of the English speaking whites
+almost without a struggle. It was as if destiny had held a door tight
+shut for centuries and suddenly had opened it to admit her chosen guests.</p>
+
+<p>History shows that such areas have almost always been held by one
+powerful nation after another, and have been the scene of ferocious
+struggles. Witness the valleys of the Euphrates, the Nile, the Danube,
+the Po and the Rhine. The barrier of the Atlantic saved North America.</p>
+
+<p>Had the Mississippi Valley been in Europe, Asia or Northern Africa, it
+would doubtless have been blood-soaked for centuries and dominated by
+highly organized nations, armed to the teeth. Lying isolated, it
+presented an almost virgin opportunity to the conquering Teutons of Western Europe.</p>
+
+<p><span class='pagenum'><a name="Page_29" id="Page_29">[Pg 29]</a></span></p><p>Freed by their isolated position from the necessity of contending
+against outside aggression, the inhabitants of the United States have
+expended their combative energies against the weaker peoples with whom
+they came into immediate contact,&mdash;</p>
+
+<blockquote><p>1. The Indians, from whom they took the land and wrested the right
+to exploit the resources of the continent;</p>
+
+<p>2. The African Negroes who were captured and brought to America to
+labor as slaves;</p>
+
+<p>3. The Mexicans, from whom they took additional slave territory at
+a time when the institution of slavery was in grave danger, and</p>
+
+<p>4. The Spanish Empire from which they took foreign investment
+opportunities at a time when the business interests of the country
+first felt the pressure of surplus wealth.</p></blockquote>
+
+<p>Each of these four groups was weak. No one of them could present even
+the beginnings of an effectual resistance to the onslaught of the
+conquerors. Each in turn was forced to bow the knee before overwhelming
+odds.</p>
+
+<h3>2. <i>The First Obstacle to Conquest</i></h3>
+
+<p>The first obstacle to the spread of English civilization across the
+continent of North America was the American Indian. He was in possession
+of the country; he had a culture of his own; he held the white man's
+civilization in contempt and refused to accept it. He had but one
+desire,&mdash;to be let alone.</p>
+
+<p>The continent was a "wilderness" to the whites. To the Indians it was a
+home. Their villages were scattered from the Atlantic to the Pacific,
+from the Gulf to Alaska; they knew well its mountains, plains and
+rivers. A primitive people, supporting themselves largely by hunting,
+fishing, simple agriculture and such elemental manual arts<span class='pagenum'><a name="Page_30" id="Page_30">[Pg 30]</a></span> as pottery
+and weaving, they found the vast stretches of North America none too
+large to provide them with the means of satisfying their wants.</p>
+
+<p>The ideas of the Indian differed fundamentally from those of the white
+man. Holding to the Eastern conception which makes the spiritual life
+paramount, he reduced his material existence to the simplest possible
+terms. He had no desire for possessions, which he regarded&mdash;at the
+best&mdash;as "only means to the end of his ultimate perfection."<a name="FNanchor_5_5" id="FNanchor_5_5"></a><a href="#Footnote_5_5" class="fnanchor">[5]</a> To him,
+the white man's desire for wealth was incomprehensible and the white
+man's sedentary life was contemptible. He must be free at all times to
+commune with nature in the valleys, and at sunrise and sunset to ascend
+the mountain peak and salute the Great Spirit.</p>
+
+<p>The individual Indian&mdash;having no desire for wealth&mdash;could not be bribed
+or bought for gold as could the European. The leaders, democratically
+selected, and held by the most enduring ties of loyalty to their tribal
+oaths, were above the mercenary standards of European commerce and
+statesmanship. Friendly, hospitable, courteous, generous, hostile,
+bitter, ferocious they were&mdash;but they were not for sale.</p>
+
+<p>The attitude of the Indian toward the land which the white men coveted
+was typical of his whole relation with white civilization. "Land
+ownership, in the sense in which we use the term, was unknown to the
+Indians till the whites came among them."<a name="FNanchor_6_6" id="FNanchor_6_6"></a><a href="#Footnote_6_6" class="fnanchor">[6]</a> The land devoted to
+villages was tribal property; the hunting ground surrounding the village
+was open to all of the members of the tribe; between the hunting grounds
+of different tribes there was a neutral territory&mdash;no man's land&mdash;that
+was common to both. If a family cultivated a patch of land, the
+neighbors did not trespass. Among the Indians of the Southwest the
+village owned the agricultural land and "periodically its<span class='pagenum'><a name="Page_31" id="Page_31">[Pg 31]</a></span> governor,
+elected by popular vote, would distribute or redistribute the arable
+acres among his constituents who were able to care for them."<a name="FNanchor_7_7" id="FNanchor_7_7"></a><a href="#Footnote_7_7" class="fnanchor">[7]</a> The
+Indians believed that the land, like the sunlight, was a gift of the
+Great Spirit to his children, and they were as willing to part with the
+one as with the other.</p>
+
+<p>They carried their communal ideas still farther. Among the Indians of
+the Northwest, a man's possessions went at his death to the whole tribe
+and were distributed among the tribal members. Among the Alaskan
+Indians, no man, during his life, could possess more than he needed
+while his neighbor lacked. Food was always regarded as common property.
+"The rule being to let him who was hungry eat, wherever he found that
+which would stay the cravings of his stomach."<a name="FNanchor_8_8" id="FNanchor_8_8"></a><a href="#Footnote_8_8" class="fnanchor">[8]</a> The motto of the
+Indian was "To each according to his need."</p>
+
+<p>Such a communist attitude toward property, coupled with a belief that
+the land&mdash;the gift of the Great Spirit&mdash;was a trust committed to the
+tribe, proved a source of constant irritation to the white colonists who
+needed additional territory. As the colonies grew, it became more and
+more imperative to increase the land area open for settlement, and to
+such encroachments the Indian offered a stubborn resistance.</p>
+
+<p>The Indian would not&mdash;could not&mdash;part with his land, neither would he
+work, as a slave or a wage-servant. Before such degradation he preferred
+death. Other peoples&mdash;the negroes; the inhabitants of Mexico, Peru and
+the West Indies; the Hindus and the Chinese&mdash;made slaves or servants.
+The Indian for generations held out stolidly against the efforts of
+missionaries, farmers and manufacturers alike to convert him into a
+worker.</p>
+
+<p>The Indian could not understand the ideas of "purchase," "sale" and
+"cash payment" that constitute essential features of the white man's
+economy. To him strength<span class='pagenum'><a name="Page_32" id="Page_32">[Pg 32]</a></span> of limb, courage, endurance, sobriety and
+personal dignity and reserve were infinitely superior to any of the
+commercial virtues which the white men possessed.</p>
+
+<p>This attitude of the Indian toward European standards of civilization;
+his indifference to material possessions; his unwillingness to part with
+the land; and his refusal to work, made it impossible to "assimilate"
+him, as other peoples were assimilated, into colonial society. The
+individual Indian would not demean himself by becoming a cog in the
+white man's machine. He preferred to live and die in the open air of his
+native hills and plains.</p>
+
+<p>The Indian was an intense individualist&mdash;trained in a school of
+experience where initiative and personal qualities were the tests of
+survival. He placed the soles of his moccasined feet firmly against his
+native earth, cast his eyes around him and above him and melted
+harmoniously into his native landscape.</p>
+
+<p>Missionaries and teachers labored in vain&mdash;once an Indian, always an
+Indian. The white settlers pushed on across mountain ranges and through
+valleys. Generations came and went without any marked progress in
+bringing the white men and the red men together. When the Indian, in the
+mission or in the government school did become "civilized," he gave over
+his old life altogether and accepted the white man's codes and
+standards. The two methods of life were too far apart to make
+amalgamation possible.</p>
+
+<h3>3. <i>Getting the Land</i></h3>
+
+<p>The white man must have land! Population was growing. The territory
+along the frontier seemed rich and alluring.</p>
+
+<p>Everywhere, the Indian was in possession, and everywhere he considered
+the sale of land in the light of parting with a birth-right. He was
+friendly at first, but he had no sympathy with the standards of white
+civilization.</p>
+
+<p><span class='pagenum'><a name="Page_33" id="Page_33">[Pg 33]</a></span></p><p>For such a situation there was only one possible solution. Under the
+plea that "necessity knows no law" the white man took up the task of
+eliminating the Indian, with the least friction, and in the most
+effective manner possible.</p>
+
+<p>There were three methods of getting the land away from the Indian&mdash;the
+easiest was by means of treaties, under which certain lands lying along
+the Atlantic Coast were turned over to the whites in exchange for larger
+territories west of the Mississippi. The second method was by purchase.
+The third was by armed conquest. All three methods were employed at some
+stage in the relations between the whites and each Indian tribe.</p>
+
+<p>The experience with the Cherokee Nation is typical of the relation
+between the whites and the other Indian tribes. (Annual Report of the
+Bureau of Ethnology. Vol. 5. "The Cherokee Nation," by Charles C.
+Royce.)</p>
+
+<p>The Cherokee nation before the year 1650 was established on the
+Tennessee River, and exercised dominion over all the country on the east
+side of the Alleghany Mountains, including the head-waters of the
+Yadkin, the Catawba, the Broad, the Savannah, the Chattahoochee and the
+Alabama. In 1775 there were 43 Cherokee towns covering portions of this
+territory. In 1799 their towns numbered 51.</p>
+
+<p>Treaty relations between the whites and the Cherokees began in 1721,
+when there was a peace council, held between the representatives of 37
+towns and the authorities of South Carolina. From that time, until the
+treaty made with the United States government in 1866, the Cherokees
+were gradually pushed back from their rich hunting grounds toward the
+Mississippi valley. By the treaty of 1791, the United States solemnly
+guaranteed to the Cherokees all of their land, the whites not being
+permitted even to hunt on them. In 1794 and 1804 new treaties were
+negotiated, involving additional cessions of land. By the treaty of
+1804, a road was to be cut through the Cherokee territory, free for the
+use of all United States citizens.</p>
+
+<p><span class='pagenum'><a name="Page_34" id="Page_34">[Pg 34]</a></span></p><p>An agitation arose for the removal of the Cherokees to some point west
+of the Mississippi River. Some of the Indians accepted the opportunity
+and went to Arkansas. Others held stubbornly to their villages.
+Meanwhile white hunters and settlers encroached on their land; white men
+debauched their women, and white desperadoes stole their stock. By the
+treaty of 1828 the United States agreed to possess the Cherokees and to
+guarantee to them forever several millions of acres west of Arkansas,
+and in addition a perpetual outlet west, and a "free and unmolested use
+of all the country lying west of the western boundary of the above
+described limits and as far west as the sovereignty of the United States
+and their right of soil extend" (p. 229). The Cherokees who had settled
+in Arkansas agreed to leave their lands within 14 months. By the treaty
+of 1836 the Cherokees ceded to the United States all lands east of the
+Mississippi. There was considerable difficulty in enforcing this
+provision but by degrees most of the Indians were removed west of the
+river. In 1859 and 1860 the Commissioner of Indian affairs prepared a
+survey of the Cherokee domain. This was opposed by the head men of the
+nation. By the Treaty of 1866 other tribes were quartered on land owned
+by the Cherokees and railroads were run through their territory.</p>
+
+<p>Diplomacy, money and the military forces had done their work. The first
+treaty, made in 1721, found the Cherokee nation in virtual possession of
+the mountainous regions of Southeastern United States. The twenty-fourth
+treaty (1866) left them on a tiny reservation, two thousand miles from
+their former home. Those twenty-four treaties had netted the State and
+Federal governments 81,220,374 acres of land (p. 378). To-day the
+Cherokee Nation has 63,211 acres.<a name="FNanchor_9_9" id="FNanchor_9_9"></a><a href="#Footnote_9_9" class="fnanchor">[9]</a></p>
+
+<p><span class='pagenum'><a name="Page_35" id="Page_35">[Pg 35]</a></span></p><p>A great nation of proud, independent, liberty-loving men and women,
+came into conflict with the whites of the Carolinas and Georgia; with
+the state and national governments. "For two hundred years a contest
+involving their very existence as a people has been maintained against
+the unscrupulous rapacity of Anglo-Saxon civilization. By degrees they
+were driven from their ancestral domain to an unknown and inhabitable
+region" (p. 371). Now the contest is ended. The white men have the land.
+The Cherokees have a little patch of territory; government support; free
+schools and the right to accept the sovereignty of the nation that has
+conquered them.</p>
+
+<p>The theory upon which the whites proceeded in taking the Indian lands is
+thus stated by Leupp,&mdash;"Originally, the Indians owned all the land;
+later we needed most of it for ourselves; therefore, it is but just that
+the Indians should have what is left."<a name="FNanchor_10_10" id="FNanchor_10_10"></a><a href="#Footnote_10_10" class="fnanchor">[10]</a></p>
+
+<h3>4. <i>The Triumph of the Whites</i></h3>
+
+<p>The early white settlers had been, in almost every instance, hospitably
+or even reverentially welcomed by the Indians, who regarded them as
+children of the Great White Spirit. During the first bitter winters, it
+was the Indians who fed the colonists from their supplies of grain;
+guided them to the better lands, and shared with them their<span class='pagenum'><a name="Page_36" id="Page_36">[Pg 36]</a></span> knowledge
+of hunting, fishing and agriculture. The whites retaliated with that
+cunning, grasping, bestial ferocity which has spread terror through the
+earth during the past five centuries.</p>
+
+<p>In the early years, when the whites were few and the Indians many, the
+whites satisfied themselves by debauching the red men with whiskey and
+bribing them with baubles and trinkets. At the same time they made
+offensive and defensive alliances with them. The Spanish in the South;
+the French in the North and the English between, leagued themselves with
+the various tribes, supplied them with gunpowder and turned them into
+mercenaries who fought for hire. Heretofore the Indian had been a free
+man, fighting his wars and feuds as free men have done time out of mind.
+The whites hired him as a professional soldier and by putting bounties
+on scalps, plying the Indians with whiskey and inciting them by every
+known device, they converted them into demons.</p>
+
+<p>There is no evidence to show that up to the advent of the white men the
+Indian tribes did any more fighting among themselves than the nobles of
+Germany, the city states of Italy or the other inhabitants of western
+Europe. Indeed there has recently been published a complete translation
+of the "Constitution of the Five Nations," a league to enforce peace
+which the Indians organized about the year 1390, A. D.<a name="FNanchor_11_11" id="FNanchor_11_11"></a><a href="#Footnote_11_11" class="fnanchor">[11]</a> This league
+which had as its object the establishment of the "Great Peace" was built
+upon very much the same argument as that advanced for the League of
+Nations of 1919.</p>
+
+<p>When the whites first came to North America, the Indians were a
+formidable foe. For years they continued to be a menace to the lonely
+settler or the frontier village. But when the white settlers were once
+firmly established, the days of uncertainty were over, and the Indians
+were brushed aside as a man brushes aside a troublesome insect. Their
+"uprisings" and "wars" counted for little or nothing. They were inferior
+in numbers; they were<span class='pagenum'><a name="Page_37" id="Page_37">[Pg 37]</a></span> poorly armed and equipped; they had no reserves
+upon which to draw; there was no organization among the tribes in
+distant portions of the country. The white millions swept onward. The
+Indian bands made a stand here and there but the tide of white
+civilization overwhelmed them, smothered them, destroying them and their
+civilization together.</p>
+
+<p>The Indians were the first obstacle to the building of the American
+Empire. Three hundred years ago the whole three million square miles
+that is now the United States was theirs. They were the American people.
+To-day they number 328,111 in a population of 105,118,467 and the total
+area of their reservations is 53,489 square miles. (Statistical Abstract
+of the U. S., 1918, pp. 8 and 776.)</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_4_4" id="Footnote_4_4"></a><a href="#FNanchor_4_4"><span class="label">[4]</span></a> The total number of square miles in Indian Reservations in
+1918 was 53,490 as against 241,800 square miles in 1880. (Statistical
+Abstract of the United States, 1918, p. 8.)</p></div>
+
+<div class="footnote"><p><a name="Footnote_5_5" id="Footnote_5_5"></a><a href="#FNanchor_5_5"><span class="label">[5]</span></a> "The Indian of To-day," C. A. Eastman. New York, Doubleday,
+1915, p. 4.</p></div>
+
+<div class="footnote"><p><a name="Footnote_6_6" id="Footnote_6_6"></a><a href="#FNanchor_6_6"><span class="label">[6]</span></a> "The Indian and His Problem," F. E. Leupp. New York,
+Scribners, 1910, p. 23.</p></div>
+
+<div class="footnote"><p><a name="Footnote_7_7" id="Footnote_7_7"></a><a href="#FNanchor_7_7"><span class="label">[7]</span></a> Ibid., p. 24.</p></div>
+
+<div class="footnote"><p><a name="Footnote_8_8" id="Footnote_8_8"></a><a href="#FNanchor_8_8"><span class="label">[8]</span></a> Ibid., p. 10.</p></div>
+
+<div class="footnote"><p><a name="Footnote_9_9" id="Footnote_9_9"></a><a href="#FNanchor_9_9"><span class="label">[9]</span></a> "Referring to your inquiry of November 20, 1919, concerning
+the Cherokee Indian Reservation, you are advised that the Cherokee
+Indian country in the northeastern part of Oklahoma aggregated 4,420,068
+acres.
+</p><p>
+"Of said area 4,346,223 acres have been allotted in severalty to the
+enrolled members of said Cherokee Indian Nation, Oklahoma. Twenty-two
+thousand eight hundred and eighty acres were disposed of as town lots,
+or reserved for railway rights of way, churches, schools, cemeteries,
+etc., and the remaining area has been sold, or otherwise disposed of as
+provided by law.
+</p><p>
+"The Cherokee tribal land in Oklahoma with the exception of the possible
+title of said Nation to certain river beds has been disposed of.
+</p><p>
+"In reference to the Eastern band of Cherokees, you are advised that
+said Indians who have been incorporated hold title in fee to certain
+land in North Carolina, known as the Qualla Reservation and certain
+other lands, aggregating 63,211 acres."&mdash;Letter from the Office of
+Indian Affairs. Dec. 9, 1919, "In re Cherokee land."</p></div>
+
+<div class="footnote"><p><a name="Footnote_10_10" id="Footnote_10_10"></a><a href="#FNanchor_10_10"><span class="label">[10]</span></a> "The Indian and His Problem," F. E. Leupp. New York,
+Scribners, 1910, p. 24.</p></div>
+
+<div class="footnote"><p><a name="Footnote_11_11" id="Footnote_11_11"></a><a href="#FNanchor_11_11"><span class="label">[11]</span></a> See Bulletin 184, New York State Museum, Albany, 1916, p.
+61.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_38" id="Page_38">[Pg 38]</a></span></p>
+
+<h2><a name="IV_SLAVERY_FOR_A_RACE" id="IV_SLAVERY_FOR_A_RACE"></a>IV. SLAVERY FOR A RACE</h2>
+
+<h3>1. <i>The Labor Shortage</i></h3>
+
+<p>The American colonists took the land which they required for settlement
+from the Indians. The labor necessary to work this land was not so
+easily secured. The colonists had set themselves the task of
+establishing European civilization upon a virgin continent. In order to
+achieve this result, they had to cut the forests; clear the land; build
+houses; cultivate the soil; construct ships; smelt iron, and carry on a
+multitude of activities that were incidental to setting up an old way of
+life in a new world. The one supreme and immediate need was the need for
+labor power. From the earliest days of colonization there had been no
+lack of harbors, fertile soil, timber, minerals and other resources.
+From the earliest days the colonists experienced a labor shortage.</p>
+
+<p>The labor situation was trebly difficult. First, there was no native
+labor; second, passage from Europe was so long and so hazardous that
+only the bold and venturesome were willing to attempt it, and third,
+when these adventurers did reach the new world, they had a choice
+between taking up free land and working it for themselves and taking
+service with a master. Men possessing sufficient initiative to leave an
+old home and make a journey across the sea were not the men to submit
+themselves to unnecessary authority when they might, at will, become
+masters of their own fortunes. The appeal of a new life was its own
+argument, and the newcomers struck out for themselves.</p>
+
+<p>Throughout the colonies, and particularly in the South where the
+plantation culture of rice and tobacco, and later of cotton, called for
+large numbers of unskilled workers, the labor problem was acute. The
+abundance of raw materials and fertile land; the speedy growth of
+industry in<span class='pagenum'><a name="Page_39" id="Page_39">[Pg 39]</a></span> the North and of agriculture in the South; the generous
+profits and expanding markets created a labor demand which far
+outstripped the meager supply,&mdash;a demand that was met by the importation
+of black slaves from Africa.</p>
+
+<h3>2. <i>The Slave Coast</i></h3>
+
+<p>The "Slave Coast" from which most of the Negroes came was discovered by
+Portuguese navigators, who were the first Europeans to venture down the
+West coast of Africa, and, rounding the "lobe" of the continent, to sail
+East along the "Gold Coast." The trade in gold and ivory which sprang up
+as a result of these early explorations led other nations of Europe to
+begin an eager competition which eventually brought French, Dutch,
+German, Danish and English commercial interests into sharp conflict with
+the Portuguese.</p>
+
+<p>Ships sailing from the Gold Coast for home ports made a practice of
+picking up such slaves as they could easily secure. By 1450 the number
+reaching Portugal each year was placed at 600 or 700.<a name="FNanchor_12_12" id="FNanchor_12_12"></a><a href="#Footnote_12_12" class="fnanchor">[12]</a> From this
+small and quite incidental beginning there developed a trade which
+eventually supplied Europe, the West Indies, North America and South
+America with black slaves.</p>
+
+<p>Along the "Slave Coast," which extended from Cape Verde on the North to
+Cape St. Martha on the South, and in the hinterland there lived Negroes
+of varying temperaments and of varying standards of culture. Some of
+them were fierce and warlike. Others were docile and amenable to
+discipline. The former made indifferent slaves; the latter were eagerly
+sought after. "The Wyndahs, Nagoes and Pawpaws of the Slave Coast were
+generally the most highly esteemed of all. They were lusty and
+industrious, cheerful and submissive."<a name="FNanchor_13_13" id="FNanchor_13_13"></a><a href="#Footnote_13_13" class="fnanchor">[13]</a></p>
+
+<p><span class='pagenum'><a name="Page_40" id="Page_40">[Pg 40]</a></span></p><p>The natives of the Slave Coast had made some notable cultural advances.
+They smelted metals; made pottery; wove; manufactured swords and spears
+of merit; built houses of stone and of mud, and made ornaments of some
+artistic value. They had developed trade with the interior, taking salt
+from the coast and bartering it for gold, ivory and other commodities at
+regular "market places."</p>
+
+<p>The native civilization along the West coast of Africa was far from
+ideal, but it was a civilization which had established itself and which
+had made progress during historic times. It was a civilization that had
+evolved language; arts and crafts; tribal unity; village life, and
+communal organization. This native African civilization, in the
+seventeenth, eighteenth and early nineteenth centuries was confronted by
+an insatiable demand for black slaves. The conflicts that resulted from
+the efforts to supply that demand revolutionized and virtually destroyed
+all that was worthy of preservation in the native culture.</p>
+
+<p>When the whites first went to the Slave Coast there was comparatively
+little slavery among the natives. Some captives, taken in war; some
+debtors, unable to meet their obligations, and some violators of
+religious rites, were held by the chief or the headman of the tribe. On
+occasion he would sell these slaves, but the slave trade was never
+established as a business until the white man organized it.</p>
+
+<p>The whites came, and with guile and by force they persuaded and
+compelled the natives to permit the erection of forts and of trading
+posts. From the time of the first Portuguese settlement, in 1482, the
+whites began their work with rum and finished it with gun-powder. Rum
+destroyed the stamina of the native; gun-powder rendered his intertribal
+wars more destructive. These two agencies of European civilization
+combined, the one to degenerate, the other to destroy the native tribal
+life.</p>
+
+<p>The traders, adventurers, buccaneers and pirates that gathered along the
+Slave Coast were not able to teach the natives anything in the way of
+cruelty, but they could and<span class='pagenum'><a name="Page_41" id="Page_41">[Pg 41]</a></span> did give them lessons in cunning, trickery
+and double dealing. Early in the history of the Gold Coast the whites
+began using the natives to make war on commercial rivals. In one famous
+instance, "the Dutch had instigated the King of Fetu to refuse the
+Assins permission to pass through his territory. These people used to
+bring a great deal of gold to Cape Coast Castle (English), and the Dutch
+hoped in this way to divert the trade to their own settlements. The King
+having complied and plundered some of the traders on the way down, the
+Assins declared war against him and were assisted by the English with
+arms and ammunition. The King of Sabol was also paid to help them, and
+the allied army (20,000 strong) inflicted a crushing defeat on the
+Fetus."<a name="FNanchor_14_14" id="FNanchor_14_14"></a><a href="#Footnote_14_14" class="fnanchor">[14]</a></p>
+
+<p>On another occasion, the Dutch were worsted in a war with some of the
+native tribes. Realizing that if they were to maintain themselves on the
+Coast they must raise an army as quickly as possible, they approached
+the Fetus and bargained with them to take the field and fight the
+Komendas until they had utterly exterminated them, on payment of $4,500.
+But no sooner had this arrangement been made than the English paid the
+Fetus an additional $4,500 to remain neutral!<a name="FNanchor_15_15" id="FNanchor_15_15"></a><a href="#Footnote_15_15" class="fnanchor">[15]</a></p>
+
+<p>Before 1750, when the competition for the slaves was less keen, and the
+supply came nearer to meeting the demand, the slavers were probably as
+honest in this as they were in any other trade with the natives. The
+whites encouraged and incited the native tribes to make war upon one
+another for the benefit of the whites. The whites fostered kidnaping,
+slavery and the slave trade. The natives were urged to betray one
+another, and the whites took advantage of their treachery. During the
+four hundred years that the African slave trade was continued, it was
+the whites who encouraged it; fostered it; and backed it financially.
+The slave trade was a white man's trade, <span class='pagenum'><a name="Page_42" id="Page_42">[Pg 42]</a></span>carried on under conditions as
+far removed from the conditions of ordinary African life as the
+manufacturing and trading of Europe were removed from the manufacturing
+and trading of the Africans.</p>
+
+<h3>3. <i>The Slave Trade</i></h3>
+
+<p>With the pressing demand from the Americas for a generous supply of
+black slaves, the business of securing them became one of the chief
+commercial activities of the time. "The trade bulked so large in the
+world's commerce in the seventeenth and eighteenth centuries that every
+important maritime community on the Atlantic sought a share, generally
+with the sanction and often with the active assistance of its respective
+sovereign."<a name="FNanchor_16_16" id="FNanchor_16_16"></a><a href="#Footnote_16_16" class="fnanchor">[16]</a></p>
+
+<p>The catching, holding and shipping of Negroes on the African coast was
+the means by which the demand for slaves was met. With a few minor
+exceptions, the whites did not engage directly in slave catching. In
+most instances they bought their slaves from native brokers who lived in
+the coast towns. The brokers, in turn, received their slaves from the
+interior, where they were captured during wars, by professional raiding
+parties, well supplied with arms and ammunition. Slave-catching, begun
+as a kidnaping of individuals, developed into a large-scale traffic that
+provided the revenue of the more war-like natives. Villages were
+attacked and burned, and whole tribes were destroyed or driven off to
+the slave-pens on the coast. After 1750, for nearly a hundred years, the
+demand for slaves was so great and the profits were so large that no
+pains were spared to secure them.</p>
+
+<p>The Slave Coast native was compelled to choose between being a
+slave-catcher or a slave. As a slave-catcher he spread terror and
+destruction among his fellows, seized them and sold them to white men.
+As a slave he made the long journey across the Atlantic.</p>
+
+<p><span class='pagenum'><a name="Page_43" id="Page_43">[Pg 43]</a></span></p><p>The number of slaves carried away from Africa is variously estimated.
+Claridge states that "the Guinea Coast as a whole supplied as many as
+from 70,000 to 100,000 yearly" in 1700.<a name="FNanchor_17_17" id="FNanchor_17_17"></a><a href="#Footnote_17_17" class="fnanchor">[17]</a> Bogart estimates the number
+of slaves secured as 2,500 per year in 1700; 15,000 to 20,000 per year
+from 1713 to 1753; in 1771, 47,000 carried by British ships alone; and
+in 1768 the slaves shipped from the African coast numbered 97,000.<a name="FNanchor_18_18" id="FNanchor_18_18"></a><a href="#Footnote_18_18" class="fnanchor">[18]</a>
+Add to these numbers those who were killed in the raids; those who died
+in the camps, where the mortality was very high, and those who committed
+suicide. The total represents the disturbing influence that the slave
+trade introduced into the native African civilization.</p>
+
+<p>In the early years of the trade the ships were small and carried only a
+few hundred Negroes at most. As the trade grew, larger and faster ships
+were built with galleries between the decks. On these galleries the
+blacks were forced to lie with their feet outboard&mdash;ironed together, two
+and two, with the chains fastened to staples in the deck. "They were
+squeezed so tightly together that the average space allowed to each one
+was but 16 inches by five and a half feet."<a name="FNanchor_19_19" id="FNanchor_19_19"></a><a href="#Footnote_19_19" class="fnanchor">[19]</a> The galleries were
+frequently made of rough lumber, not tightly joined. Later, when the
+trade was outlawed, the slaves were stowed away out of sight on loose
+shelves over the cargo. "Where the 'tween decks space was two feet high
+or more, the slaves were stowed sitting up in rows, one crowded into the
+lap of another, and with legs on legs, like rider on a crowded
+toboggan." (Spears, p. 71.) There they stayed for the weeks or the
+months of the voyage. "In storms the sailors had to put on the hatches
+and seal tight the openings into the infernal cesspool." (Spears, p.
+71.) The odor of a slaver was often unmistakable at a distance of five
+miles down wind.</p>
+
+<p><span class='pagenum'><a name="Page_44" id="Page_44">[Pg 44]</a></span></p><p>The terrible revolt of the slaves in the West Indies, beginning in
+1781, gave the growing anti-slavery sentiment an immense impetus. It
+also gave the slave owners pause. The cotton-gin had not yet been
+invented. Slavery was on a shifty economic basis in the South. Great
+Britain passed the first law to limit the slave trade in 1788; the
+United States outlawed the trade in 1794. In 1824 Great Britain declared
+the slave trade piracy. During these years, and during the years that
+followed, until the last slaver left New York Harbor in 1863, the trade
+continued under the American flag, in swift, specially constructed
+American-built ships.</p>
+
+<p>As the restrictions upon the trade became more severe in the face of an
+increasing demand for slaves, "the fitting out of slavers developed into
+a flourishing business in the United States, and centered in New York
+City." <i>The New York Journal of Commerce</i> notes in 1857 that "down-town
+merchants of wealth and respectability are extensively engaged in buying
+and selling African Negroes, and have been, with comparatively little
+interruption for an indefinite number of years." A writer in the
+<i>Continental Monthly</i> for January, 1862, says:&mdash;"The city of New York
+has been until of late the principal port of the world for this infamous
+commerce; although the cities of Boston and Portland, are only second to
+her in distinction." During the years 1859-1860 eighty-five slavers are
+reported to have fitted out in New York Harbor and these ships alone had
+a capacity to transport from 30,000 to 60,000 slaves a year.<a name="FNanchor_20_20" id="FNanchor_20_20"></a><a href="#Footnote_20_20" class="fnanchor">[20]</a></p>
+
+<p>The merchants of the North pursued the slave trade so relentlessly
+because it paid such enormous profits on the capital outlay. Some of the
+voyages went wrong, but the trade, on the whole, netted immense returns.
+At the end of the eighteenth century a good ship, fitted to carry from
+300 to 400 slaves, could be built for about $35,000. Such a ship would
+make a clear profit of from $30,000 to $100,000 in a single voyage. Some
+of them made as many as five<span class='pagenum'><a name="Page_45" id="Page_45">[Pg 45]</a></span> voyages before they became so foul that
+they had to be abandoned.<a name="FNanchor_21_21" id="FNanchor_21_21"></a><a href="#Footnote_21_21" class="fnanchor">[21]</a> While some voyages were less profitable
+than others, there was no avenue of international trade that offered
+more alluring possibilities.</p>
+
+<p>Sanctioned by potentates, blessed by the church, and surrounded with the
+garments of respectability, the slave trade grew, until, in the words of
+Samuel Hopkins (1787), "The trade in human species has been the first
+wheel of commerce in Newport, on which every other movement in business
+has depended.... By it the inhabitants have gotten most of their wealth
+and riches." (Spears, p. 20.) After the vigorous measures taken by the
+British Government for its suppression, the slave trade was carried on
+chiefly in American-built ships; officered by American citizens; backed
+by American capital, and under the American flag.</p>
+
+<p>The slave trade was the business of the North as slavery was the
+business of the South. Both flourished until the Proclamation of
+Emancipation in 1863.</p>
+
+<h3>4. <i>Slavery in the United States</i></h3>
+
+<p>Slavery and the slave trade date from the earliest colonial times. The
+first slaves in the English colonies were brought to Jamestown in 1619
+by a Dutch ship. The first American-built slave ship was the <i>Desire</i>,
+launched at Marblehead in 1636. There were Negro slaves in New York as
+early as 1626, although there were only a few hundred slaves in the
+colonies prior to 1650.</p>
+
+<p>Since slave labor is economical only where the slaves can be worked
+together in gangs, there was never much slavery among the farmers and
+small business men of the North. On the other hand, in the South, the
+developing plantation system made it possible for the owner to use large
+gangs of slaves in the clearing of new land; in the raising of<span class='pagenum'><a name="Page_46" id="Page_46">[Pg 46]</a></span> tobacco,
+and in caring for rice and cotton. The plantation system of agriculture
+and the cotton gin made slavery the success that it was in the United
+States. "The characteristic American slave, indeed, was not only a
+Negro, but a plantation workman."<a name="FNanchor_22_22" id="FNanchor_22_22"></a><a href="#Footnote_22_22" class="fnanchor">[22]</a></p>
+
+<p>The opening years of the nineteenth century found slavery intrenched
+over the whole territory of the United States that lay South of the
+Mason and Dixon line. In that territory slave trading and slave owning
+were just as much a matter of course as horse trading and horse owning
+were a matter of course in the North. "Every public auctioneer handled
+slaves along with other property, and in each city there were brokers,
+buying them to sell again, and handling them on commission."<a name="FNanchor_23_23" id="FNanchor_23_23"></a><a href="#Footnote_23_23" class="fnanchor">[23]</a></p>
+
+<p>The position of the broker is indicated in the following typical bill of
+sale which was published in Charleston, S. C., in 1795. "Gold Coast
+Negroes. On Thursday, the 17th of March instant, will be exposed to
+public sale near the exchange ... the remainder of the cargo of negroes
+imported in the ship <i>Success</i>, Captain John Conner, consisting chiefly
+of likely young boys and girls in good health, and having been here
+through the winter may be considered in some degree seasoned to the
+climate."<a name="FNanchor_24_24" id="FNanchor_24_24"></a><a href="#Footnote_24_24" class="fnanchor">[24]</a></p>
+
+<p>Such a bill of sale attracted no more attention at that time than a
+similar bill advertising cattle attracts to-day.</p>
+
+<p>During the early colonial days, the slaves were better fed and provided
+for than were the indentured servants. They were of greater money value
+and, particularly in the later years when slavery became the mainstay of
+Southern agriculture, a first class Negro, acclimated, healthy, willing
+and trustworthy, was no mean asset.</p>
+
+<p>Toward the end of the eighteenth century slavery began to show itself
+unprofitable in the South. The best and most<span class='pagenum'><a name="Page_47" id="Page_47">[Pg 47]</a></span> accessible land was
+exhausted. Except for the rice plantations of South Carolina and
+Georgia, slavery was not paying. The Southern delegates to the
+Constitutional Convention, with the exception of the delegates from
+these states, were prepared to abolish the slave trade. Some of them
+were ready to free their own slaves. Then came the invention of the
+cotton gin and the rise of the cotton kingdom. The amount of raw cotton
+consumed by England was 13,000 bales in 1781; 572,000 bales in 1820; and
+3,366,000 bales in 1860. During that period, the South was almost the
+sole source of supply.</p>
+
+<p>The attitude of the South, confronted by this wave of slave prosperity,
+underwent a complete change. Her statesmen had consented, between 1808
+and 1820, to severe restrictive laws directed towards the slave trade.
+After cotton became king, slaves rose rapidly in price; land, once used
+and discarded, was again brought under cultivation; cotton-planting
+spread rapidly into the South and Southwest; Texas was annexed; the
+Mexican War was fought; an agitation was begun for the annexation of
+Cuba, and Calhoun (1836) declared that he "ever should regret that this
+term (piracy) had been applied" to the slave trade in our laws.<a name="FNanchor_25_25" id="FNanchor_25_25"></a><a href="#Footnote_25_25" class="fnanchor">[25]</a></p>
+
+<p>The change of sentiment corresponded with the changing value of the
+slaves. Phillips publishes a detailed table of slave values in which he
+estimates that an unskilled, able-bodied young slave man was worth $300
+in 1795; $500 to $700 in 1810; $700 to $1200 to in 1840; and $1100 to
+$1800 in 1860.<a name="FNanchor_26_26" id="FNanchor_26_26"></a><a href="#Footnote_26_26" class="fnanchor">[26]</a> The factors which resulted in the increased slave
+prices were the increased demand for cotton, the increased demand for
+slaves, and the decrease in the importation of negroes due to the
+greater severity of the prohibitions on the slave trade.</p>
+
+<p><span class='pagenum'><a name="Page_48" id="Page_48">[Pg 48]</a></span></p>
+
+<h3>5. <i>Slavery for a Race</i></h3>
+
+<p>The American colonists needed labor to develop the wilderness. White
+labor was scarce and high, so the colonists turned to slave labor
+performed by imported blacks. The merchants of the North built the ships
+and carried on the slave trade at an immense profit. The plantation
+owners of the South exploited the Negroes after they reached the states.</p>
+
+<p>The continuance of the slave trade and the provision of a satisfactory
+supply of slaves for the Southern market depended upon slave-catching in
+Africa, which, in turn, involved the destruction of an entire
+civilization. This work of destruction was carried forward by the
+leading commercial nations of the world. During nearly 250 years the
+English speaking inhabitants of America took an active part in the
+business of enslaving, transporting and selling black men. These
+Americans&mdash;citizens of the United States&mdash;bought stolen Negroes on the
+African coast; carried them against their will across the ocean; sold
+them into slavery, and then, on the plantations, made use of their
+enforced labor.</p>
+
+<p>Both slavery and the slave trade were based on a purely economic
+motive&mdash;the desire for profit. In order to satisfy that desire, the
+American people helped to depopulate villages,&mdash;to devastate, burn,
+murder and enslave; to wipe out a civilization, and to bring the
+unwilling objects of their gain-lust thousands of miles across an
+impassable barrier to alien shores.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_12_12" id="Footnote_12_12"></a><a href="#FNanchor_12_12"><span class="label">[12]</span></a> "History of the Gold Coast," W. W. Claridge. London,
+Murray, 1915, vol. I, p. 39.</p></div>
+
+<div class="footnote"><p><a name="Footnote_13_13" id="Footnote_13_13"></a><a href="#FNanchor_13_13"><span class="label">[13]</span></a> "American Negro Slavery," U. B. Phillips. New York,
+Appleton, 1908, p. 43.</p></div>
+
+<div class="footnote"><p><a name="Footnote_14_14" id="Footnote_14_14"></a><a href="#FNanchor_14_14"><span class="label">[14]</span></a> "A History of the Gold Coast," W. W. Claridge. London,
+Murray, 1915, vol. I, p. 144.</p></div>
+
+<div class="footnote"><p><a name="Footnote_15_15" id="Footnote_15_15"></a><a href="#FNanchor_15_15"><span class="label">[15]</span></a> Ibid., p. 150.</p></div>
+
+<div class="footnote"><p><a name="Footnote_16_16" id="Footnote_16_16"></a><a href="#FNanchor_16_16"><span class="label">[16]</span></a> "American Negro Slavery," U. B. Phillips. New York,
+Appleton, 1918, p. 20.</p></div>
+
+<div class="footnote"><p><a name="Footnote_17_17" id="Footnote_17_17"></a><a href="#FNanchor_17_17"><span class="label">[17]</span></a> "History of the Gold Coast," W. W. Claridge. London,
+Murray, 1915, vol. I, p. 172.</p></div>
+
+<div class="footnote"><p><a name="Footnote_18_18" id="Footnote_18_18"></a><a href="#FNanchor_18_18"><span class="label">[18]</span></a> "Economic History of the U. S.," E. L. Bogart. New York,
+Longmans, 1910 ed., p. 84-5.</p></div>
+
+<div class="footnote"><p><a name="Footnote_19_19" id="Footnote_19_19"></a><a href="#FNanchor_19_19"><span class="label">[19]</span></a> "The American Slave Trade," J. R. Spears. New York,
+Scribners, 1901, p. 69.</p></div>
+
+<div class="footnote"><p><a name="Footnote_20_20" id="Footnote_20_20"></a><a href="#FNanchor_20_20"><span class="label">[20]</span></a> "The Suppression of the American Slave Trade," W. E. B.
+DuBois. New York, Longmans, 1896, p. 178-9.</p></div>
+
+<div class="footnote"><p><a name="Footnote_21_21" id="Footnote_21_21"></a><a href="#FNanchor_21_21"><span class="label">[21]</span></a> "The American Slave Trade," J. R. Spears. New York,
+Scribners, 1901, p. 84-5.</p></div>
+
+<div class="footnote"><p><a name="Footnote_22_22" id="Footnote_22_22"></a><a href="#FNanchor_22_22"><span class="label">[22]</span></a> "American Negro Slavery," U. B. Phillips. New York,
+Appleton, 1918, p. VII.</p></div>
+
+<div class="footnote"><p><a name="Footnote_23_23" id="Footnote_23_23"></a><a href="#FNanchor_23_23"><span class="label">[23]</span></a> Ibid., p. 190.</p></div>
+
+<div class="footnote"><p><a name="Footnote_24_24" id="Footnote_24_24"></a><a href="#FNanchor_24_24"><span class="label">[24]</span></a> Ibid., p. 40.</p></div>
+
+<div class="footnote"><p><a name="Footnote_25_25" id="Footnote_25_25"></a><a href="#FNanchor_25_25"><span class="label">[25]</span></a> Benton, "Abridgment of Debates." XII, p. 718.</p></div>
+
+<div class="footnote"><p><a name="Footnote_26_26" id="Footnote_26_26"></a><a href="#FNanchor_26_26"><span class="label">[26]</span></a> "American Negro Slavery," U. B. Phillips. New York,
+Appleton, 1918, p. 370.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_49" id="Page_49">[Pg 49]</a></span></p>
+
+<h2><a name="V_THE_WINNING_OF_THE_WEST" id="V_THE_WINNING_OF_THE_WEST"></a>V. THE WINNING OF THE WEST</h2>
+
+<h3>1. <i>Westward, Ho!</i></h3>
+
+<p>The English colonists in America occupied only the narrow strip of
+country between the Alleghanies and the Atlantic Ocean. The interior was
+inhabited by the Indians, and claimed by the French, the Spanish and the
+British, but neither possession nor legal title carried weight with the
+stream of pioneers that was making a path into the "wilderness," crying
+its slogan,&mdash;"Westward, Ho!" as it moved toward the setting sun. The
+first objective of the pioneers was the Ohio Valley; the second was the
+valley of the Mississippi; the third was the Great Plains; the fourth
+was the Pacific slope, with its golden sands. Each one of these
+objectives developed itself out of the previous conquest.</p>
+
+<p>The settlers who made their way across the mountains into the valley of
+the Ohio, found themselves in a land of plenty. The game was abundant;
+the soil was excellent, and soon they were in a position to offer their
+surplus products for sale. These products could not be successfully
+transported across the mountains, but they could be floated down the
+Ohio and the Mississippi&mdash;a natural roadway to the sea. But beside the
+Indians, who claimed all of the land for their own, there were the
+Spaniards at New Orleans, doing everything in their power to prevent the
+American Colonists from building up a successful river commerce.</p>
+
+<p>The frontiersmen were able to push back the Indians. The Spanish
+garrisons presented a more serious obstacle. New Orleans was a well
+fortified post that could be provisioned from the sea. Behind it,
+therefore, lay the whole power of the Spanish fleet. The right of
+navigation was finally obtained in the Treaty of 1795. Still friction
+<span class='pagenum'><a name="Page_50" id="Page_50">[Pg 50]</a></span>continued with the Spanish authorities and serious trouble was averted
+only by the transfer of Louisiana, first to the French (1800) and then
+by them to the United States (1803). Napoleon had agreed, when he
+secured this territory from the Spaniards, not to turn it over to the
+United States. A pressing need of funds, however, led him to strike an
+easy bargain with the American government which was negotiating for the
+control of the mouth of the Mississippi. Napoleon insisted that the
+United States take, not only the mouth of the river, but also the
+territory to the West which he saw would be useless without this outlet.
+After some hesitation, Jefferson and his advisers accepted the offer and
+the Louisiana Purchase was consummated.</p>
+
+<p>The Louisiana Purchase gave the young American nation what it needed&mdash;a
+place in the sun. The colonists had taken land for their early
+requirements from the Indians who inhabited the coastal plain. They had
+enslaved the Negroes and thus had secured an ample supply of cheap
+labor. Now, the pressure of population, and the restless, pioneer spirit
+of those early days, led out into the West.</p>
+
+<p>Until 1830 immigration was not a large factor in the increase of the
+colonial population, but the birth-rate was prodigious. In the closing
+years of the eighteenth century, Franklin estimated that the average
+family had eight children. There were sections of the country where the
+population doubled, by natural increase, once in 23 years. Indeed, the
+entire population of the United States was increasing at a phenomenal
+rate. The census of 1800 showed 5,308,483 persons in the country. Twenty
+years later the population was 9,638,453&mdash;an increase of 81 per cent. By
+1840 the population was reported as 17,069,453&mdash;an increase of 77 per
+cent over 1820, and of 221 per cent over 1800.</p>
+
+<p>The small farmers and tradesmen of the North were settling up the
+Northwest Territory. The plantation owners of the South, operating on a
+large scale, and with the wasteful methods that inevitably accompany
+slavery, were clamoring for new land to replace the tracts that had
+been<span class='pagenum'><a name="Page_51" id="Page_51">[Pg 51]</a></span> exhausted by constant recropping with no attempt at fertilization.</p>
+
+<p>Cotton had been enthroned in the South since the invention of the cotton
+gin in 1792. With the resumption of European trade relations in 1815 the
+demand for cotton and for cotton lands increased enormously. There was
+one, and only one logical way to meet this demand&mdash;through the
+possession of the Southwest.</p>
+
+<h3>2. <i>The Southwest</i></h3>
+
+<p>The pioneers had already broken into the Southwest in large numbers.
+While Spain still held the Mississippi, there were eager groups of
+settlers pressing against the frontier which the Spanish guarded so
+jealously against all comers. The Louisiana Purchase met the momentary
+demand, but beyond the Louisiana Purchase, and between the settlers and
+the rich lands of Texas lay the Mexican boundary. The tide of migration
+into this new field hurled itself against the Mexican border in the same
+way that an earlier generation had rolled against the frontier of
+Louisiana.</p>
+
+<p>The attitude of these early settlers is described with sympathetic
+accuracy by Theodore Roosevelt. "Louisiana was added to the United
+States because the hardy backwoods settlers had swarmed into the valleys
+of the Tennessee, the Cumberland and the Ohio by hundreds of
+thousands.... Restless, adventurous, hardy, they looked eagerly across
+the Mississippi to the fertile solitudes where the Spaniard was the
+nominal, and the Indian the real master; and with a more immediate
+longing they fiercely coveted the Creole provinces at the mouth of the
+river."<a name="FNanchor_27_27" id="FNanchor_27_27"></a><a href="#Footnote_27_27" class="fnanchor">[27]</a> This fierce coveting could have only one possible
+outcome&mdash;the colonists got what they wanted.</p>
+
+<p><span class='pagenum'><a name="Page_52" id="Page_52">[Pg 52]</a></span></p><p>The speed with which the Southwest rushed into prominence as a factor
+in national affairs is indicated by its contribution to the cotton-crop.
+In 1811 the states and territories from Alabama and Tennessee westward
+produced one-sixteenth of the cotton grown in the United States. In 1820
+they produced a third; in 1830, a half; and by 1860, three-quarters of
+the cotton raised. At the same time, the population of the
+Alabama-Mississippi territory was:&mdash;</p>
+
+<table class="right" summary="population of the Alabama-Mississippi territory">
+  <tr>
+    <td>200,000 in 1810.</td>
+  </tr>
+  <tr>
+    <td>445,000 in 1820.</td>
+  </tr>
+  <tr>
+    <td>965,000 in 1830.</td>
+  </tr>
+  <tr>
+    <td>1,377,000 in 1840.</td>
+  </tr>
+</table>
+
+<p>Thus thirty years saw an increase of nearly seven-fold in the population
+of this region.<a name="FNanchor_28_28" id="FNanchor_28_28"></a><a href="#Footnote_28_28" class="fnanchor">[28]</a></p>
+
+<p>Meanwhile, slavery had become the issue of the day. The slave power was
+in control of the Federal Government, and in order to maintain its
+authority, it needed new slave states to offset the free states that
+were being carved out of the Northwest.</p>
+
+<p>Here were three forces&mdash;first the desire of the frontiersmen for "elbow
+room"; second the demand of King Cotton for unused land from which the
+extravagant plantation system might draw virgin fertility and third, the
+necessity that was pressing the South to add territory in order to hold
+its power. All three forces impelled towards the Southwest, and it was
+thither that population pressed in the years following 1820.</p>
+
+<h3>3. <i>Texas</i></h3>
+
+<p>Mexico lay to the Southwest, and therefore Mexico became the object of
+American territorial ambitions. The district now known as Texas had
+constituted a part of the Louisiana Purchase (1803); had been ceded to
+Spain (1819); had been made the object of negotiations looking towards
+its<span class='pagenum'><a name="Page_53" id="Page_53">[Pg 53]</a></span> purchase in 1826; had revolted against Mexico and been recognized
+as an independent state in 1835.</p>
+
+<p>Texas had been settled by Americans who had secured the permission of
+the Mexican Government to colonize. These settlers made no effort to
+conceal their opposition to the Mexican Government, with which they were
+entirely out of sympathy. Many of them were seeking territory in which
+slavery might be perpetuated, and they introduced slaves into Texas in
+direct violation of the Mexican Constitution. The Americans did not go
+to Texas with any idea of becoming Mexican subjects; on the contrary, as
+soon as they felt themselves strong enough, they declared their
+independence of Mexico, and began negotiations for the annexation of
+Texas to the United States.</p>
+
+<p>The Texan struggle for independence from Mexico was cordially welcomed
+in all parts of the United States, but particularly in the South.
+Despite the protests of Mexico, public meetings were held; funds were
+raised; volunteers were enlisted and equipped, and supplies and
+munitions were sent for the assistance of the Texans in ships openly
+fitted out in New Orleans.</p>
+
+<p>No sooner had the Texans established a government than the campaign for
+annexation was begun. The advocates of annexation&mdash;principally
+Southerners&mdash;argued in favor of adding so rich and so logical a prize to
+the territory of the United States, citing the purchase of Louisiana and
+of Florida as precedents. Their opponents, first on constitutional
+grounds and then on grounds of public policy, argued against annexation.</p>
+
+<p>Opinion in the South was greatly aroused. Despite the fact that many of
+her foremost statesmen were against annexation, some of the Southern
+newspapers even went so far as to threaten the dissolution of the Union
+if the treaty of ratification failed to pass the Senate.</p>
+
+<p>The campaign of 1844 was fought on the issue of annexation and the
+election of James K. Polk was a pledge that Texas should be annexed to
+the United States. During<span class='pagenum'><a name="Page_54" id="Page_54">[Pg 54]</a></span> the campaign, the line of division on
+annexation had been a party line&mdash;Democrats favoring; Whigs opposing.
+Between the election and the passage of the joint resolution by which
+annexation was consummated, it became a sectional issue,&mdash;Southern Whigs
+favoring annexation and Northern Democrats opposing it.</p>
+
+<p>So strong was the protest against annexation, that the treaty could not
+command the necessary two-thirds vote in the Senate. The matter was
+disposed of by the passage of a joint resolution (March 1, 1845) which
+required only a majority vote in both houses of Congress. President Polk
+therefore took office with the mandate of the country and the decision
+of both houses of the retiring Congress, in favor of annexation.</p>
+
+<p>Mexico, in the meantime, had offered to recognize the independence of
+Texas and to make peace with her if the Texas Congress would reject the
+joint resolution, and refuse the proffered annexation. This the Texas
+Congress refused, and with the passage, by that body, of an act
+providing for annexation, the Mexican minister was withdrawn from
+Washington, and Mexico began her preparations for war.</p>
+
+<p>President Polk had taken office with the avowed intention of buying
+California from Mexico. The rupture threatened to prevent him from
+carrying this plan into effect. He therefore sent an unofficial
+representative to Mexico in an effort to restore friendly relations.
+Failing in that, he and his advisers determined upon war as the only
+feasible method of obtaining California and of settling the diplomatic
+tangle involved in the annexation of Texas.</p>
+
+<h3>4. <i>The Conquest of Mexico</i></h3>
+
+<p>The Polk Administration made the Mexican War as a part of its expansionist policy.</p>
+
+<p>"Although that unfortunate country (Mexico) had officially notified the
+United States that the annexation of<span class='pagenum'><a name="Page_55" id="Page_55">[Pg 55]</a></span> Texas would be treated as a cause
+of war, so constant were the internal quarrels in Mexico that open
+hostilities would have been avoided had the conduct of the
+Administration been more honorable. That was the opinion of Webster,
+Clay, Calhoun, Benton, and Tyler.... Mexico was actually goaded on to
+war. The principle of the manifest destiny of this country was invoked
+as a reason for the attempt to add to our territory at the expense of
+Mexico."<a name="FNanchor_29_29" id="FNanchor_29_29"></a><a href="#Footnote_29_29" class="fnanchor">[29]</a></p>
+
+<p>After the annexation of Texas it became the duty of the United States to
+defend that state against the threatened Mexican invasion.</p>
+
+<p>Mexican troops had occupied the southern bank of the Rio Grande. General
+Zachary Taylor with a small force, moved to a position on the Nueces
+River. Between the two rivers lay a strip of territory the possession of
+which was one of the sources of dispute between Mexico and Texas. What
+followed may be stated in the words of one of the officers who
+participated in the expedition: "The presence of the United States
+troops on the edge of the territory farthest from the Mexican
+settlements was not sufficient to provoke hostilities. We were sent to
+provoke a fight, but it was essential that Mexico begin it" (p. 41).
+"Mexico showing no willingness to come to the Nueces to drive the
+invaders from her soil, it became necessary for the 'invaders' to
+approach to within a convenient distance to be struck. Accordingly,
+preparations were begun for moving the army to the Rio Grande, to a
+point near Matamoras. It was desirable to occupy a position near the
+largest center of population possible to reach without actually invading
+territory to which we set up no claim whatever" (p. 45).<a name="FNanchor_30_30" id="FNanchor_30_30"></a><a href="#Footnote_30_30" class="fnanchor">[30]</a></p>
+
+<p>The occupation, by the United States troops, of the disputed territory
+soon led to a clash in which several United States soldiers were killed.
+The incident was taken by the President as a sufficient cause for the
+declaration of a<span class='pagenum'><a name="Page_56" id="Page_56">[Pg 56]</a></span> state of war. The House complied readily with his
+wishes, passing the necessary resolution. Several members of the Senate
+begged for a delay during which the actual state of affairs might be
+ascertained. The President insisted, however, and the war was declared
+(May 13, 1846).</p>
+
+<p>The declaration of war was welcomed with wild enthusiasm in the South.
+Meetings were called; funds were raised; volunteers were enlisted,
+equipped and despatched in all haste to the scene of the conflict.</p>
+
+<p>The North was less eager. There were protests, petitions,
+demonstrations. Many of the leaders of northern opinion took a public
+stand against the war. But the news of the first victories sent the
+country mad with an enthusiasm in which the North joined the South.</p>
+
+<p>The United States troops, during the Mexican War, won brilliant&mdash;almost
+unbelievable successes&mdash;against superior forces and in the face of
+immense natural obstacles. Had the war been less of a military triumph
+there must have been a far more widely-heard protest from Polk's enemies
+in the North. Successful beyond the wildest dreams of its promoters, the
+victorious war carried its own answer to those who questioned the
+worthiness of the cause. Within two years, the whole of Mexico was under
+the military control of the United States, and that country was in a
+position to dictate its own terms.</p>
+
+<p>The demands of the United States were mild to the extent of generosity.
+Under the treaty the annexation of Texas was validated; New Mexico and
+Upper California were ceded to the United States; the lower Rio Grande
+was fixed as the southern boundary of Texas, and in considerations of
+these additions to its territory, the United States agreed to pay Mexico
+fifteen millions of dollars.</p>
+
+<p>Under this plan, Mexico was paid for territory that she did not need and
+could not use, while the United States gave a money consideration for
+the title to land that was already hers by right of conquest, and of
+which she was in actual possession.</p>
+
+<p><span class='pagenum'><a name="Page_57" id="Page_57">[Pg 57]</a></span></p><p>The details of the treaty are relatively unimportant. The outstanding
+fact is that Mexico was in possession of certain territory that the
+ruling power in the United States wanted, and that ruling power took
+what it wanted by force of arms. "The war was one of conquest in the
+interest of an institution." It was "one of the most unjust ever waged
+by a stronger against a weaker nation."<a name="FNanchor_31_31" id="FNanchor_31_31"></a><a href="#Footnote_31_31" class="fnanchor">[31]</a></p>
+
+<p>Congressman A. P. Gardner of Massachusetts summarized the matter very
+pithily in his debate with Morris Hillquit (New York, April 2, 1915),
+"We assisted Texas to get away from Mexico and then we proceeded to
+annex Texas. Plainly and bluntly stated, our purpose was to get some
+territory for American development." (Stenographic report in the <i>New
+York Call</i>, April 11, 1915.)</p>
+
+<h3>5. <i>Conquering the Conquered</i></h3>
+
+<p>The work of conquering the Southwest was not completed by the
+termination of the war. Mexico ceded the territory&mdash;in the neighborhood
+of a million square miles&mdash;but she was giving away something that she
+had never possessed. Mexico claimed title to land that was occupied by
+the Indians. She had never conquered it; never settled it; never
+developed it. Her sovereignty was of the same shadowy sort that Spain
+had exercised over the country before the Mexican revolution.</p>
+
+<p>The new owners of the Southwest had a very different purpose in mind. No
+empty title would satisfy them. They intended to use the land. The
+Indians&mdash;already in possession&mdash;resented the encroachments of the
+invaders, but they fared no better than the Mexicans, or than their
+red-skinned brothers who had contended for the right to fish and hunt
+along their home streams in the Appalachians. The Indians of the
+Southwest fought stubbornly, but the wars that meant life and death to
+them were the merest<span class='pagenum'><a name="Page_58" id="Page_58">[Pg 58]</a></span> pastime for an army that had just completed the
+humiliation of a nation of the size and strength of Mexico. The Indians
+were swept aside, and the country was opened to the trapper, the
+prospector, the trader and the settler.</p>
+
+<p>The Mexican War was a slight affair, involving a relatively small outlay
+in men and money. The total number of American soldiers killed in the
+war was 1,721; the wounded were 4,102; the deaths from accident and
+disease were 11,516, making total casualties of 5,823 and total losses
+of 15,618.<a name="FNanchor_32_32" id="FNanchor_32_32"></a><a href="#Footnote_32_32" class="fnanchor">[32]</a></p>
+
+<p>The money cost of the Mexican War&mdash;the army and navy appropriations for
+the years 1846 to 1849 inclusive&mdash;was $119,624,000. Obviously the net
+cost of the war was less than this gross total,&mdash;how much less it is
+impossible to say.</p>
+
+<p>No satisfactory figures are available to show the cost in men and money
+of the Indian Wars in the Southwest. "From 1849 to 1865, the government
+expended $30,000,000 in the subjugation of the Indians in the
+territories of New Mexico and Arizona."<a name="FNanchor_33_33" id="FNanchor_33_33"></a><a href="#Footnote_33_33" class="fnanchor">[33]</a> Their character may be
+gauged by noting from the "Historical Register" (Vol. 2, p. 281-2) the
+losses sustained in the four Indian Wars of which a record is preserved.
+In the Northwest Indian Wars (1790 to 1795) 896 persons were killed and
+436 were wounded; in the Seminole War (1817 to 1818) 46 were killed and
+36 were wounded; in the Black Hawk War (1831-2) the killed were 26 and
+the wounded 39; in the Seminole War (1835-1842) 383 were killed and 557
+wounded. These were among the most serious of the Indian Wars and in all
+of them the cost in life and limb was small. Judged on this standard,
+the losses in the Southwest, during the Indian Wars, were, at most,
+trifling. The total outlay that was involved in the conquest of the vast
+domain would not have covered one first class battle of the Great War,
+and yet this outlay added<span class='pagenum'><a name="Page_59" id="Page_59">[Pg 59]</a></span> to the territory of the United States
+something like a million square miles containing some of the richest and
+most productive portions of the earth's surface.</p>
+
+<p>This domain was won by a process of military conquest; it was taken from
+the Mexicans and the Indians by force of arms. In order to acquire it,
+it was necessary to drive whole tribes from their villages; to burn; to
+maim; to kill. "St. Louis, New Orleans, St. Augustine, San Antonio,
+Santa Fe and San Francisco are cities that were built by Frenchmen and
+Spaniards; we did not found them but we conquered them." "The Southwest
+was conquered only after years of hard fighting with the original
+owners" (p. 26). "The winning of the West and the Southwest is a stage
+in the conquest of a continent" (p. 27). "This great westward movement
+of armed settlers was essentially one of conquest, no less than of
+colonization" (p. 370).<a name="FNanchor_34_34" id="FNanchor_34_34"></a><a href="#Footnote_34_34" class="fnanchor">[34]</a> None of the possessors of this territory
+were properly armed or equipped for effective warfare. All of them fell
+an easy prey to the organized might of the Government of the United
+States.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_27_27" id="Footnote_27_27"></a><a href="#FNanchor_27_27"><span class="label">[27]</span></a> "The Winning of the West," Theodore Roosevelt. New York,
+Putnam's, 1896, vol. 4, p. 262.</p></div>
+
+<div class="footnote"><p><a name="Footnote_28_28" id="Footnote_28_28"></a><a href="#FNanchor_28_28"><span class="label">[28]</span></a> "American Negro Slavery," U. B. Phillips. New York,
+Appleton, 1918, pp. 171-2.</p></div>
+
+<div class="footnote"><p><a name="Footnote_29_29" id="Footnote_29_29"></a><a href="#FNanchor_29_29"><span class="label">[29]</span></a> "History of the United States," James F. Rhoades. New
+York, Macmillan, 1906, vol. I, p. 87.</p></div>
+
+<div class="footnote"><p><a name="Footnote_30_30" id="Footnote_30_30"></a><a href="#FNanchor_30_30"><span class="label">[30]</span></a> "Personal Memoirs," U. S. Grant. New York, Century, 1895,
+vol. I.</p></div>
+
+<div class="footnote"><p><a name="Footnote_31_31" id="Footnote_31_31"></a><a href="#FNanchor_31_31"><span class="label">[31]</span></a> "Personal Memoirs," U. S. Grant. New York, Century, 1895,
+vol. I, pp. 115 and 32.</p></div>
+
+<div class="footnote"><p><a name="Footnote_32_32" id="Footnote_32_32"></a><a href="#FNanchor_32_32"><span class="label">[32]</span></a> "Historical Register of the United States Army," F. B.
+Heitman. Washington, Govt. Print., vol. 2, p. 282.</p></div>
+
+<div class="footnote"><p><a name="Footnote_33_33" id="Footnote_33_33"></a><a href="#FNanchor_33_33"><span class="label">[33]</span></a> "The Story of New Mexico," Horatio O. Ladd. Boston, D.
+Lothrop Co., 1891, p. 333.</p></div>
+
+<div class="footnote"><p><a name="Footnote_34_34" id="Footnote_34_34"></a><a href="#FNanchor_34_34"><span class="label">[34]</span></a> "The Winning of the West," Theodore Roosevelt. Vol. I, p.
+26, 27, and Vol. II, p. 370.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_60" id="Page_60">[Pg 60]</a></span></p>
+
+<h2><a name="VI_THE_BEGINNINGS_OF_WORLD_DOMINION" id="VI_THE_BEGINNINGS_OF_WORLD_DOMINION"></a>VI. THE BEGINNINGS OF WORLD DOMINION</h2>
+
+<h3>1. <i>The Shifting of Control</i></h3>
+
+<p>During the half century that intervened between the War of 1812 and the
+Civil War of 1861 the policy of the United States government was decided
+largely by men who came from south of the Mason and Dixon line. The
+Southern whites,&mdash;class-conscious rulers with an institution (slavery)
+to defend,&mdash;acted like any other ruling class under similar
+circumstances. They favored Southward expansion which meant more
+territory in which slavery might be established.</p>
+
+<p>The Southerners were looking for a place in the sun where slavery, as an
+institution, might flourish for the profit and power of the
+slave-holding class. Their most effective move in this direction was the
+annexation of Texas and the acquisition of territory following the
+Mexican War. An insistent drive for the annexation of Cuba was cut short
+by the Civil War.</p>
+
+<p>Southern sentiment had supported the Louisiana Purchase of 1803 and the
+Florida Purchase of 1819. From Jefferson's time Southern statesmen had
+been advocating the purchase of Cuba. Filibustering expeditions were
+fitted out in Southern ports with Cuba as an objective; agitation was
+carried on, inside and outside of Congress; between 1850 and 1861 the
+acquisition of Cuba was the question of the day. It was an issue in the
+Campaign of 1853. In 1854 the American ministers to London, France and
+Madrid met at the direction of the State Department and drew up a
+document (the "Ostend Manifesto") dealing with the future of Cuba.
+McMaster summarizes the Manifesto in these words: "The United States
+ought to buy Cuba because of its nearness to our coast; because it
+belonged naturally to that great group of states of which<span class='pagenum'><a name="Page_61" id="Page_61">[Pg 61]</a></span> the Union was
+the providential nursery; because it commanded the mouth of the
+Mississippi whose immense and annually growing trade must seek that way
+to the ocean, and because the Union could never enjoy repose, could
+never be secure, till Cuba was within its boundaries." (Vol. viii, pp.
+185-6.) If Spain refused to sell Cuba it was suggested that the United
+States should take it.</p>
+
+<p>The Ostend Manifesto was rejected by the State Department, but it was a
+good picture of the imperialistic sentiment at that time abroad among
+certain elements in the United States.</p>
+
+<p>The Cuban issue featured in the Lincoln-Douglas Debates in 1858. It was
+hotly discussed by Congress in 1859. Only twenty years had passed since
+the United States, by force of arms, had taken from Mexico territory
+that she coveted. Now it was proposed to appropriate territory belonging
+to Spain.</p>
+
+<p>The outbreak of hostilities deferred the project, and when the Civil War
+was over, the slave power was shattered. From that time forward national
+policy was guided by the leaders of the new industrial North.</p>
+
+<p>The process of this change was fearfully wasteful. The shifting of power
+from the old r&eacute;gime to the new cost more lives and a greater expenditure
+of wealth than all of the wars of conquest that had been fought during
+the preceding half century.</p>
+
+<p>The change was complete. The slaves were liberated by Presidential
+Proclamation. The Southern form of civilization&mdash;patriarchal and
+feudal&mdash;disappeared, and upon its ruins&mdash;rapidly in the West; slowly in
+the South&mdash;there arose the new structure of an industrial civilization.</p>
+
+<p>The new civilization had no need to look outward for economic advantage.
+Forest tracts, mineral deposits and fertile land afforded ample
+opportunity at home. It was three thousand miles to the Pacific and at
+the end of the journey there was gold! The new civilization therefore
+turned its energies to the problem of subduing the <span class='pagenum'><a name="Page_62" id="Page_62">[Pg 62]</a></span>continent and of
+establishing the machinery necessary to provide for its vastly
+increasing needs. A small part of the capital required for this purpose
+came from abroad. Most of it was supplied at home. But the events
+involved in opening up the territory west of the Rockies, of spanning
+the country with steel, and providing outlets for the products of the
+developing industries were so momentous that even the most ambitious
+might fulfill his dreams of conquest without setting foot on foreign
+soil. Territorial aggrandizement was forgotten, and men turned with a
+will to the organization of the East and the exploration and development
+of the West.</p>
+
+<p>The leaders of the new order found time to take over Alaska (1868) with
+its 590,884 square miles. The move was diplomatic rather than economic,
+however, and it was many years before the huge wealth of Alaska was even
+suspected.</p>
+
+<h3>2. <i>Hawaii</i></h3>
+
+<p>The new capitalist interests began to feel the need of additional
+territory toward the end of the nineteenth century. The desirable
+resources of the United States were largely in private hands and most of
+the available free land had been pre-empted. Beside that, there were
+certain interests, like sugar and tobacco, that were looking with
+longing eyes toward the tempting soil and climate of Hawaii, Porto Rico
+and Cuba.</p>
+
+<p>When the South had advocated the annexation of Texas, its statesmen had
+been denounced as expansionists and imperialists. The same fate awaited
+the statesmen of the new order who were favoring the extension of United
+States territory to include some of the contiguous islands that offered
+special opportunities for certain powerful financial interests.</p>
+
+<p>The struggle began over the annexation of Hawaii. After numerous
+attempts to annex Hawaii to the United States a revolution was finally
+consummated in Honolulu<span class='pagenum'><a name="Page_63" id="Page_63">[Pg 63]</a></span> in 1893. At that time, under treaty provisions,
+the neutrality of Hawaii was guaranteed by the United States. Likewise,
+"of the capital invested in the islands, two-thirds is owned by
+Americans." This statement is made in "Address by the Hawaiian Branches
+of the Sons of the American Revolution, the Sons of Veterans, and the
+Grand Army of the Republic to their compatriots in America Concerning
+the Annexation of Hawaii." (1897.) These advocates of annexation state
+in the same address that: "The revolution (of 1893) was not the work of
+filibusterers and adventurers, but of the most conservative and
+law-abiding citizens, of the principal tax-payers, the leaders of
+industrial enterprises, etc." The purpose behind the revolution seemed
+clear. Certain business men who had sugar and other products to sell in
+the United States, believed that they would gain, financially, by
+annexation. They engineered the revolution of 1893 and they were
+actively engaged in the agitation for annexation that lasted until the
+treaty of annexation was confirmed by the United States in 1898. The
+matter was debated at length on the floor of the United States Senate,
+and an investigation revealed the essential facts of the case.</p>
+
+<p>The immediate cause of the revolution in 1893 was friction over the
+Hawaiian Constitution. After some agitation, a "Committee of Safety" was
+organized for the protection of life and property on the islands.
+Certain members of the Hawaiian government were in favor of declaring
+martial law, and dealing summarily with the conspirators. The Queen
+seems to have hesitated at such a course because of the probable
+complications with the government of the United States.</p>
+
+<p>The <i>U. S. S. Boston</i>, sent at the request of United States Minister
+Stevens to protect American life and property in the Islands, was lying
+in the harbor of Honolulu. After some negotiations between the
+"Committee of Safety" and Minister Stevens, the latter requested the
+Commander of the <i>Boston</i> to land a number of marines. This was done on
+the afternoon of January 16, 1893. Immediately the<span class='pagenum'><a name="Page_64" id="Page_64">[Pg 64]</a></span> Governor of the
+Island of Oahu and the Minister of Foreign Affairs addressed official
+communications to the United States Minister, protesting against the
+landing of troops "without permission from the proper authorities."
+Minister Stevens replied, assuming full responsibility.</p>
+
+<p>On the day following the landing of the marines, the Committee of
+Safety, under the chairmanship of Judge Dole, who had resigned as
+Justice of the Supreme Court of Hawaii in order to accept the
+Chairmanship of the Committee, proceeded to the government building, and
+there, under cover of the guns of the United States Marines, who were
+drawn up for the purpose of protecting the Committee against possible
+attack, a proclamation was read, declaring the abrogation of the
+Hawaiian monarchy, and the establishment of a provisional government "to
+exist until terms of union with the United States have been negotiated
+and agreed upon." Within an hour after the reading of this proclamation,
+and while the Queen and her government were still in authority, and in
+possession of the Palace, the Barracks, and the Police Station, the
+United States Minister gave the Provisional Government his recognition.</p>
+
+<p>The Queen, who had 500 soldiers in the Barracks, was inclined to fight,
+but on the advice of her counselors, she yielded "to the superior force
+of the United States of America" until the facts could be presented at
+Washington, and the wrong righted.</p>
+
+<p>Two weeks later, on the first of February, Minister Stevens issued a
+proclamation declaring a protectorate over the islands. This action was
+later repudiated by the authorities at Washington, but on February 15,
+President Harrison submitted a treaty of annexation to the Senate. The
+treaty failed of passage, and President Cleveland, as one of his first
+official acts, ordered a complete investigation of the whole affair.</p>
+
+<p>The Senate Committee on Foreign Relations submitted a report on the
+matter February 26, 1894. Four members<span class='pagenum'><a name="Page_65" id="Page_65">[Pg 65]</a></span> referred to the acts of Minister
+Stevens as "active, officious and unbecoming participation in the events
+which led to the revolution." All members of the committee agreed that
+his action in declaring a protectorate over the Islands was unjustified.</p>
+
+<p>The same kind of a fight that developed over the annexation of Texas now
+took place over the annexation of Hawaii. A group of senators, of whom
+Senator R. F. Pettigrew was the most conspicuous figure, succeeded in
+preventing the ratification of the annexation treaty until July 7, 1898.
+Then, ten weeks after the declaration of the Spanish-American War, under
+the stress of the war-hysteria, Hawaii was annexed by a joint resolution
+of Congress.</p>
+
+<p>The Annexation of Hawaii marks a turning point in the history of the
+United States. For the first time, the American people secured
+possession of territory lying outside of the mainland of North America.
+For the first time the United States acquired territory lying within the
+tropics. The annexation of Hawaii was the first imperialistic act after
+the annexation of Texas, more than fifty years before. It was the first
+imperialistic act since the capitalists of the North had succeeded the
+slave-owners of the South as the masters of American public life.</p>
+
+<h3>3. <i>The Spanish-American War</i></h3>
+
+<p>The real test of the imperial intentions of the United States came with
+the Spanish-American War. An old, shattered world empire (Spain) held
+Porto Rico, Cuba and the Philippines. Porto Rico and Cuba were of
+peculiar value to the sugar and tobacco interests of the United States.
+They were close to the mainland, they were enormously productive and,
+furthermore, Cuba contained important deposits of iron ore.</p>
+
+<p>Spain had only a feeble grip on her possessions. For years the natives
+of Cuba and of the Philippines had been<span class='pagenum'><a name="Page_66" id="Page_66">[Pg 66]</a></span> in revolt against the Spanish
+power. At times the revolt was covert. Again it blazed in the open.</p>
+
+<p>The situation in Cuba was rendered particularly critical because of the
+methods used by the Spanish authorities in dealing with the rebellious
+natives. The Spaniards were simply doing what any empire does to
+suppress rebellion and enforce obedience, but the brutalities of
+imperialism, as practiced in Cuba by the Spaniards, gave the American
+interventionists their opportunity. Day after day the newspapers carried
+front page stories of Spanish atrocities in Cuba. Day after day the
+ground was prepared for open intervention in the interests of the
+oppressed Cubans. There was more than grim humor in the instructions
+which a great newspaper publisher is reported to have sent his
+cartoonist in Cuba,&mdash;"You provide the pictures; we'll furnish the war."</p>
+
+<p>The conflict was precipitated by the blowing up of the United States
+battleship <i>Maine</i> as she lay in the harbor of Havana (February 15,
+1898). It has not been settled to this day whether the <i>Maine</i> was blown
+up from without or within. At the time it was assumed that the ship was
+blown up by the Spanish, although "there was no evidence whatever that
+any one connected with the exercise of Spanish authority in Cuba had had
+so much as guilty knowledge of the plans made to destroy the <i>Maine</i>"
+(p. 270), and although "toward the last it had begun to look as if the
+Spanish Government were ready, rather than let the war feeling in the
+United States put things beyond all possibility of a peaceful solution,
+to make very substantial concessions to the Cuban insurgents and bring
+the troubles of the Island to an end" (p. 273-4).<a name="FNanchor_35_35" id="FNanchor_35_35"></a><a href="#Footnote_35_35" class="fnanchor">[35]</a></p>
+
+<p>Congress, in a joint resolution passed April 20, 1898, declared that
+"the people of the Island of Cuba are, and of right ought to be, free
+and independent.... The United States hereby disclaims any intention to
+exercise sovereignty, jurisdiction or control over said island except
+for<span class='pagenum'><a name="Page_67" id="Page_67">[Pg 67]</a></span> the pacification thereof, and asserts its determination, when that
+is accomplished, to leave the government and control of the island to
+its people."</p>
+
+<p>The war itself was of no great moment. There was little fighting on
+land, and the naval battles resulted in overwhelming victories for the
+American Navy. The treaty, ratified February 6, 1899, provided that
+Spain should cede to the United States Guam, Porto Rico, Cuba and the
+Philippines, and that the United States should pay to Spain twenty
+millions of dollars. As in the case of the Mexican War, the United
+States took possession of the territory and then paid a bonus for a
+clear title.</p>
+
+<p>The losses in the war were very small. The total number of men who were
+killed in action and who died of wounds was 289; while 3,949 died of
+accidents and disease. ("Historical Register," Vol. 2, p. 187.) The cost
+of the war was comparatively slight. Hostilities lasted from April 21,
+1898 to August 12, 1898. The entire military and naval expense for the
+year 1898 was $443,368,000; for the year 1899, $605,071,000. Again the
+need for a larger place in the sun had been felt by the people of the
+United States and again the United States had won immense riches with a
+tiny outlay in men and money.</p>
+
+<p>Now came the real issue,&mdash;What should the United States do with the
+booty?</p>
+
+<p>There were many who held that the United States was bound to set the
+peoples of the conquered territory free. To be sure the specific pledge
+contained in the joint resolution of April 20, 1898, applied to Cuba
+alone, but, it was argued, since the people of the Philippines had also
+been fighting for liberty, and since they had come so near to winning
+their independence from the Spaniards, they were likewise entitled to
+it.</p>
+
+<p>On the other hand, the advocates of annexation insisted that it was the
+duty of the United States to accept the responsibilities (the "white
+man's burden") that the acquisition of these islands involved.</p>
+
+<p><span class='pagenum'><a name="Page_68" id="Page_68">[Pg 68]</a></span></p><p>As President McKinley put it:&mdash;"The Philippines, like Cuba and Porto
+Rico, were entrusted to our hands by the providence of God." (President
+McKinley, Boston, February 16, 1899.) How was the country to avoid such
+a duty?</p>
+
+<p>Thus was the issue drawn between the "imperialists" and the "anti-imperialists."</p>
+
+<p>The imperialists had the machinery of government, the newspapers, and
+the prestige of a victorious and very popular war behind them. The
+anti-imperialists had half a century of unbroken tradition; the accepted
+principles of self-government; the sayings of men who had organized the
+Revolution of 1776; written the Declaration of Independence; held
+exalted offices and piloted the nation through the Civil War.</p>
+
+<p>The imperialists used their inside position. The anti-imperialists
+appealed to public opinion. They organized a league "to aid in holding
+the United States true to the principles of the Declaration of
+Independence. It seeks the preservation of the rights of the people as
+guaranteed to them by the Constitution. Its members hold self-government
+to be fundamental, and good government to be but incidental. It is its
+purpose to oppose by all proper means the extension of the sovereignty
+of the United States over subject peoples. It will contribute to the
+defeat of any candidate or party that stands for the forcible
+subjugation of any people." (From the declaration of principle printed
+on the literature in 1899 and 1900.) Anti-imperialist conferences were
+held in New York, Philadelphia, Chicago, Indianapolis, Boston and other
+large cities. The League claimed to have half a million members. An
+extensive pamphlet literature was published, and every effort was made
+to arouse the people of the country to the importance of the decision
+that lay before them.</p>
+
+<p>The imperialists said a great deal less than their opponents, but they
+were more effective in their efforts. The President had said, in his
+message to Congress (April 1,<span class='pagenum'><a name="Page_69" id="Page_69">[Pg 69]</a></span> 1898), "I speak not of forcible
+annexation, for that cannot be thought of. That, by our code of morals,
+would be criminal aggression." The phrase was seized eagerly by those
+who were opposing the annexation of the Spanish possessions. After the
+war with Spain had begun, the President changed front on the ground that
+destiny had placed a responsibility upon the American people that they
+could not shirk. Taking this view of the situation, the President had
+only one course open to him&mdash;to insist upon the annexation of the
+Philippines, Porto Rico and Guam. This was the course that was followed,
+and on April 11, 1899, these territories were officially incorporated
+into the United States.</p>
+
+<p>Senator Hoar, in a speech on January 9, 1899, put the issue squarely. He
+described it as "a greater danger than we have encountered since the
+Pilgrims landed at Plymouth&mdash;the danger that we are to be transformed
+from a republic, founded on the Declaration of Independence, guided by
+the counsels of Washington, into a vulgar, commonplace empire, founded
+upon physical force."</p>
+
+<p>Cuba remained to be disposed of. With the specific guarantee of
+independence contained in the joint resolution passed at the outbreak of
+the war, it seemed impossible to do otherwise than to give the Cubans
+self-government. Many influential men lamented the necessity, but it was
+generally conceded. But how much independence should Cuba have? That
+question was answered by the passage of the Cuban Treaty with the "Platt
+Amendment" attached. Under the treaty as ratified the United States does
+exercise "sovereignty, jurisdiction and control" over the island.</p>
+
+<h3>4. <i>The Philippines</i></h3>
+
+<p>The territory acquired from Spain was now, in theory, disposed of.
+Practically, the Philippines remained as a source of difficulty and even
+of political danger.</p>
+
+<p>The people of Cuba were, apparently, satisfied. The Porto Ricans had
+accepted the authority of the United<span class='pagenum'><a name="Page_70" id="Page_70">[Pg 70]</a></span> States without question. But the
+Filipinos were not content. If the Cubans were to have self-government,
+why not they?</p>
+
+<p>The situation was complicated by the peculiar relations existing between
+the Filipinos and the United States Government. Immediately after the
+declaration of war with Spain the United States Consul-General at
+Singapore had cabled to Admiral Dewey at Hong Kong that Aguinaldo,
+leader of the insurgent forces in the Philippines, was then at
+Singapore, and was ready to go to Hong Kong. Commodore Dewey cabled back
+asking Aguinaldo to come at once to Hong Kong. Aguinaldo left Singapore
+on April 26, 1898, and, with seventeen other revolutionary Filipino
+chiefs, was taken from Hong Kong to Manila in the United States naval
+vessel <i>McCulloch</i>. Upon his arrival in Manila, he at once took charge
+of the insurgents.</p>
+
+<p>For three hundred years the inhabitants of the Philippines had been
+engaged in almost incessant warfare with the Spanish authorities. In the
+spring of 1898 they were in a fair way to win their independence. They
+had a large number of men under arms&mdash;from 20,000 to 30,000; they had
+fought the Spanish garrisons to a stand-still, and were in practical
+control of the situation.</p>
+
+<p>Aguinaldo was furnished with 4,000 or 5,000 stands of arms by the
+American officials, he took additional arms from the Spaniards and he
+and his people co&ouml;perated actively with the Americans in driving the
+Spanish out of Luzon. The Filipino army captured Iloilo, the second
+largest city in the Philippines, without the assistance of the
+Americans. On the day of the surrender of Manila, 15&frac12; miles of the
+surrounding line was occupied by the Filipinos and 600 yards by the
+American troops. Throughout the early summer, the relations between the
+Filipinos and the Americans continued to be friendly. General Anderson,
+in command of the American Army, wrote a letter to the commander of the
+Filipinos (July 4, 1898) in which he said,&mdash;"I desire to have the most
+amicable relations with you and to have you and your people co&ouml;perate
+with<span class='pagenum'><a name="Page_71" id="Page_71">[Pg 71]</a></span> us in military operations against the Spanish forces." During the
+summer the American officers called upon the Filipinos for supplies and
+information and accepted their co&ouml;peration. Aguinaldo, on his part,
+treated the Americans as deliverers, and in his proclamations referred
+to them as "liberators" and "redeemers."</p>
+
+<p>The Filipinos, at the earliest possible moment, organized a government.
+On June 18 a republic was proclaimed; on the 23rd the cabinet was
+announced; on the 27th a decree was published providing for elections,
+and on August 6th an address was issued to foreign governments,
+announcing that the revolutionary government was in operation, and was
+in control of fifteen provinces.</p>
+
+<p>The real intent of the Americans was foreshadowed in the instructions
+handed by President McKinley to General Wesley Merritt on May 19, 1898.
+General Merritt was directed to inform the Filipinos that "we come not
+to make war upon the people of the Philippines, nor upon any party or
+faction among them, but to protect them in their homes, in their
+employments, and in their personal and religious rights. Any persons
+who, either by active aid or by honest submission, co&ouml;perate with the
+United States in its effort to give effect to this beneficent purpose,
+will receive the reward of its support and protection."</p>
+
+<p>The Filipinos sent a delegation to Paris to lay their claims for
+independence before the Peace Commission. Meeting with no success, they
+visited Washington, with no different result. They were not to be free!</p>
+
+<p>On September 8, 1898, General Otis, commander of the American forces in
+the Philippines, notified Aguinaldo that unless he withdrew his forces
+from Manila and its suburbs by the 15th "I shall be obliged to resort to
+forcible action." On January 5, 1899, by Presidential Proclamation,
+McKinley ordered that "The Military Government heretofore maintained by
+the United States in the city, harbor, and bay of Manila is to be
+extended with all possible dispatch to the whole of the ceded
+territory." On February<span class='pagenum'><a name="Page_72" id="Page_72">[Pg 72]</a></span> 4, 1899, General Otis reported "Firing upon the
+Filipinos and the killing of one of them by the Americans, leading to
+return fire." (Report up to April 6, 1899.) Then followed the Philippine
+War during which 1,037 Americans were killed in action or died of
+wounds; 2,818 were wounded, and 2,748 died of disease. ("Historical
+Register," Vol. II, p. 293.)</p>
+
+<p>The Philippines were conquered twice&mdash;once in a contest with Spain (in
+co&ouml;peration with the Filipinos, who regarded themselves as our allies),
+and once in a contest with the Filipinos, the native inhabitants, who
+were made subjects of the American Empire by this conquest.<a name="FNanchor_36_36" id="FNanchor_36_36"></a><a href="#Footnote_36_36" class="fnanchor">[36]</a></p>
+
+<h3>5. <i>Imperialism Accepted</i></h3>
+
+<p>The Philippine War was the last political episode in the life of the
+American Republic. From February 4, 1899, the United States accepted the
+political status of an Empire. Hawaii had been annexed at the behest of
+the Hawaiian Government; Porto Rico had been occupied as a part of the
+war strategy and without any protest from the Porto Ricans. The
+Philippines were taken against the determined opposition of the natives,
+who continued the struggle for independence during three bitter years.</p>
+
+<p>The Filipinos were fighting for independence&mdash;fighting to drive invaders
+from their soil. The United States authorities had no status in the
+Philippines other than that of military conquerors.</p>
+
+<p>Continental North America was occupied by the whites after a long
+struggle with the Indian tribes. This territory was "conquered"&mdash;but it
+was contiguous&mdash;it formed a part of a geographic unity. The Philippines
+were separated from San Francisco by 8,000 miles of water;
+geographically they were a part of Asia. They were tropical in
+<span class='pagenum'><a name="Page_73" id="Page_73">[Pg 73]</a></span>character, and were inhabited by tribes having nothing in common with
+the American people except their common humanity. Nevertheless, despite
+non-contiguity; despite distance; despite dissimilarity in languages and
+customs, the soldiers of the United States conquered the Filipinos and
+the United States Government took control of the islands, acting in the
+same way that any other empire, under like circumstances, unquestionably
+would have acted.</p>
+
+<p>There was no strategic reason that demanded the Philippines unless the
+United States desired to have an operating base near to the vast
+resources and the developing markets of China. As a vantage point from
+which to wage commercial and military aggression in the Far East, the
+Philippines may possess certain advantages. There is no other excuse for
+their conquest and retention by the United States save the economic
+excuse of advantages to be gained from the possession of the islands
+themselves.</p>
+
+<p>The end of the nineteenth century saw the end of the Republic about
+which men like Jefferson and Lincoln wrote and dreamed. The New Century
+marked the opening of a new epoch&mdash;the beginning of world dominion for
+the United States.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_35_35" id="Footnote_35_35"></a><a href="#FNanchor_35_35"><span class="label">[35]</span></a> "A History of the American People," Woodrow Wilson. New
+York, Harpers, 1902, Vol. V, pp. 273-4.</p></div>
+
+<div class="footnote"><p><a name="Footnote_36_36" id="Footnote_36_36"></a><a href="#FNanchor_36_36"><span class="label">[36]</span></a> For further details on the Philippine problem see Senate
+Document 62, Part I, 55th Congress, Third Session.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_74" id="Page_74">[Pg 74]</a></span></p>
+
+<h2><a name="VII_THE_STRUGGLE_FOR_WEALTH_AND_POWER" id="VII_THE_STRUGGLE_FOR_WEALTH_AND_POWER"></a>VII. THE STRUGGLE FOR WEALTH AND POWER</h2>
+
+<h3>1. <i>Economic Foundations</i></h3>
+
+<p>The people of the United States, through their contests with the
+American Indians, the Mexicans and the Filipinos, have established that
+"supreme and extensive political domination" which is one of the chief
+characteristics of empire.</p>
+
+<p>But the American Empire does not rest upon a political basis. Only the
+most superficial portions of its superstructure are political in
+character. Imperialism in the United States, as in every other modern
+country, is built not upon politics, but upon industry.</p>
+
+<p>The struggle between empires has shifted, in recent years, from the
+political and the military to the economic field. The old imperialism
+was based on military conquest and political domination. The new
+"financial" imperialism is based on economic opportunities and
+advantages. Under this new r&eacute;gime, territorial domination is
+subordinated to business profit.</p>
+
+<p>While American public officials were engaged in the routine task of
+extending the political boundaries of the United States, the foundations
+of imperial strength were being laid by the masters of industrial
+life&mdash;the traders, manufacturers, bankers, the organizers of trusts and
+of industrial combinations. These owners and directors of the nation's
+wealth have been the real builders of the American Empire.</p>
+
+<p>As the United States has developed, the economic motives have come more
+and more to the surface, until no modern nation&mdash;not England
+herself&mdash;has such a record in the search for material possessions. The
+pursuit of wealth, in the United States, has been carried forward
+ruthlessly; brutally. "Anything to win" has been the motto. Man<span class='pagenum'><a name="Page_75" id="Page_75">[Pg 75]</a></span> against
+man, and group against group, they have struggled for gain,&mdash;first, in
+order to "get ahead;" then to accumulate the comforts and luxuries, and
+last of all, to possess the immense power that goes with the control of
+modern wealth.</p>
+
+<p>The early history of the country presaged anything but this. The
+colonists were seeking to escape tyranny, to establish justice and to
+inaugurate liberty. Their promises were prophetic. Their early deeds put
+the world in their debt. Forward looking people everywhere thrilled at
+the mention of the name "America." Then came the discovery of the
+fabulous wealth of the new country; the pressure of the growing stream
+of immigrants; the heaping up of riches; the rapacious search after
+more! more! the desertion of the dearest principles of America's early
+promise, and the transcribing of another story of "economic
+determinism."</p>
+
+<p>Until very recent times the American people continued to talk of
+political affairs as though they were the matters of chief public
+concern. The recent growth and concentration of economic power have
+showed plainly, however, that America was destined to play her greatest
+r&ocirc;le on the economic field. Capable men therefore ceased to go into
+politics and instead turned their energies into the whirl of business,
+where they received a training that made them capable of handling
+affairs of the greatest intricacy and magnitude.</p>
+
+<h3>2. <i>Every Man for Himself</i></h3>
+
+<p>The development of American industry, during the hundred years that
+began with the War of 1812, led inevitably to the unification of
+business control in the hands of a small group of wealth owners.</p>
+
+<p>"Every man for himself" was the principle that the theorists of the
+eighteenth century bequeathed to the industrial pioneers of the
+nineteenth. The philosophy of individualism fitted well with the
+temperament and experience of the English speaking peoples; the practice
+of <span class='pagenum'><a name="Page_76" id="Page_76">[Pg 76]</a></span>individualism under the formula "Every man for himself" seemed a
+divine ordination for the benefit of the new industry.</p>
+
+<p>The eager American population adopted the slogan with enthusiasm. "Every
+man for himself" was the essence of their frontier lives; it was the
+breath of the wilderness.</p>
+
+<p>But the idea failed in practice. Despite the assurances of its champions
+that individualism was necessary to preserve initiative and that
+progress was impossible without it, like many another principle&mdash;fine
+sounding in theory, it broke down in the application.</p>
+
+<p>The first struggle that confronted the ambitious conqueror of the new
+world was the struggle with nature. Her stores were abundant, but they
+must be prepared for human use. Timber must be sawed; soil tilled; fish
+caught; coal mined; iron smelted; gold extracted. Rivers must be
+bridged; mountains spanned; lines of communication maintained. The
+continent was a vast storehouse of riches&mdash;potential riches. Before they
+could be made of actual use, however, the hand of man must transform
+them and transport them.</p>
+
+<p>These necessary industrial processes were impossible under the "every
+man for himself" formula. Here was a vast continent, with boundless
+opportunities for supplying the necessaries and comforts of
+life&mdash;provided men were willing to come together; divide up the work;
+specialize; and exchange products.</p>
+
+<p>Co&ouml;peration&mdash;alone&mdash;could conquer nature. The basis of this co&ouml;peration
+proved to be the machine. Its means was the system of production and
+transportation built upon the use of steam, electricity, gas, and labor
+saving appliances.</p>
+
+<p>When the United States was discovered, the shuttle was thrown by hand;
+the hammer was wielded by human arm; the mill-stones were turned by wind
+and water; the boxes and bales were carried by pack-animals or in
+sailing vessels,&mdash;these processes of production and transportation were<span class='pagenum'><a name="Page_77" id="Page_77">[Pg 77]</a></span>
+conducted in practically the same way as in the time of Pharaoh or of
+Alexander the Great. A series of discoveries and inventions, made in
+England between 1735 and 1784, substituted the machine for the tool; the
+power of steam for the power of wind, water or human muscle; and set up
+the factory to produce, and the railroad and the steamboat to transport
+the factory product.</p>
+
+<p>American industry, up to 1812, was still conducted on the old,
+individualistic lines. Factories were little known. Men worked singly,
+or by twos and threes in sheds or workrooms adjoining their homes. The
+people lived in small villages or on scattered farms. Within the century
+American industry was transformed. Production shifted to the factory;
+about the factory grew up the industrial city in which lived the tens or
+hundreds of thousands of factory workers and their families.</p>
+
+<p>The machine made a new society. The artisan could not compete with the
+products of the machine. The home workshop disappeared, and in its place
+rose the factory, with its tens, its hundreds and its thousands of
+operatives.</p>
+
+<p>Under the modern system of machine production, each person has his
+particular duty to perform. Each depends, for the success of his
+service, upon that performed by thousands of others.</p>
+
+<p>All modern industry is organized on the principle of co&ouml;peration,
+division of labor, and specialization. Each has his task, and unless
+each task is performed the entire system breaks down.</p>
+
+<p>Never were the various branches of the military service more completely
+dependent upon each other than are the various departments of modern
+economic life. No man works alone. All are associated more or less
+intimately with the activities of thousands and millions of their
+fellows, until the failure of one is the failure of all, and the success
+of one is the success of all.</p>
+
+<p>Such a development could have only one possible result,&mdash;people who
+worked together must live together. <span class='pagenum'><a name="Page_78" id="Page_78">[Pg 78]</a></span>Scattered villages gave place to
+industrial towns and cities. People were compelled to co&ouml;perate in their
+lives as well as in their labor.</p>
+
+<p>The theory under which the new industrial society began its operations
+was "every man for himself." The development of the system has made
+every man dependent upon his fellows. The principle demanded an extreme
+individualism. The practice has created a vast network of
+inter-relations, that leads the cotton spinner of Massachusetts to eat
+the meat prepared by the packing-house operative in Omaha, while the
+pottery of Trenton and the clothing of New York are sent to the Yukon in
+exchange for fish and to the Golden Gate for fruit. Inside as well as
+outside the nation, the world is united by the strong hands of economic
+necessity. None can live to himself, alone. Each depends upon the labor
+of myriads whom he has never seen and of whom he has never heard.
+Whether we will or no, they are his brothers-in-labor&mdash;united in the
+Atlas fellowship of those who carry the world upon their shoulders.</p>
+
+<p>The theory of "every man for himself" failed. The practical exigencies
+involved in subjugating a continent and wresting from nature the means
+of livelihood made it necessary to introduce the opposite
+principle,&mdash;"In Union there is strength; co&ouml;peration achieves all things."</p>
+
+<h3>3. <i>The Struggle for Organization</i></h3>
+
+<p>The technical difficulties involved in the mechanical production of
+wealth compelled even the individualists to work together. The
+requirements of industrial organization drove them in the same
+direction.</p>
+
+<p>The first great problem before the early Americans was the conquest of
+nature. To this problem the machine was the answer. The second problem
+was the building of an organization capable of handling the new
+mechanism of production&mdash;an organization large enough, elastic enough,<span class='pagenum'><a name="Page_79" id="Page_79">[Pg 79]</a></span>
+stable enough and durable enough&mdash;to this problem the corporation was
+the answer.</p>
+
+<p>The machine produced the goods. The corporation directed the production,
+marketed the products and financed both operations.</p>
+
+<p>The corporation, as a means of organizing and directing business
+enterprise is a product of the last hundred years. A century ago the
+business of the United States was carried on by individuals,
+partnerships, and a few joint stock companies. At the time of the last
+Census, more than four-fifths of the manufactured products were turned
+out under corporate direction; most of the important mining enterprises
+were corporate, and the railroads, public utilities, banks and insurance
+companies were virtually all under the corporate form of organization.
+Thus the passage of a century has witnessed a complete revolution in the
+form of organizing and directing business enterprise.</p>
+
+<p>The corporation, as a form of business organization is immensely
+superior to individual management and to the partnership.</p>
+
+<p>1. The corporation has perpetual life. In the eyes of the law, it is a
+person that lives for the term of its charter. Individuals die;
+partnerships are dissolved; but the corporation with its unbroken
+existence, possesses a continuity and a permanence that are impossible
+of attainment under the earlier forms of business organization.</p>
+
+<p>2. Liability, under the corporation, is limited by the amount of the
+investment. The liability of an individual or a partner engaged in
+business was as great as his ability to pay. The investor in a
+corporation cannot lose a sum larger than that represented by his
+investment.</p>
+
+<p>3. The corporation, through the issuing of stocks and bonds, makes it
+possible to subdivide the total amount invested in one enterprise into
+many small units.<a name="FNanchor_37_37" id="FNanchor_37_37"></a><a href="#Footnote_37_37" class="fnanchor">[37]</a> These<span class='pagenum'><a name="Page_80" id="Page_80">[Pg 80]</a></span> chances for small investment mean that a
+large number of persons may join in subscribing the capital for a
+business enterprise. They also mean that one well-to-do person may
+invest his wealth in a score or a hundred enterprises, thus reducing the
+risk of heavy losses to a minimum.</p>
+
+<p>4. The corporation is not, as were the earlier forms of organization,
+necessarily a "one man" concern. Many corporations have upon their
+boards of directors the leading business men, merchants, bankers and
+financiers. In this way, the investing public has the assurance that the
+enterprise will be conducted along business lines, while the business
+men on the board have an opportunity to get in on the "ground floor."</p>
+
+<p>The corporation has a permanence, a stability, and a breadth of
+financial support that are quite impossible in the case of the private
+venture or of the partnership. It does for business organization what
+the machine did for production.</p>
+
+<p>The corporation came into favor at a time when business was expanding
+rapidly. Surplus was growing. Wealth and capital were accumulating.
+Industrial units were increasing in size. It was necessary to find some
+means by which the surplus wealth in the hands of many individuals could
+be brought together, large sums of capital concentrated under one
+unified control, the investments, thus secured, safeguarded against
+untoward losses, and the business conservatively and efficiently
+directed. The corporation was the answer to these needs.</p>
+
+<p>"United we stand" proved to be as true of organizers and investors as it
+was of producers. The corporation was the common denominator of people
+with various industrial and financial interests.</p>
+
+<p>The corporation played another r&ocirc;le of vital consequence. It enabled the
+banker to dominate the business world. Heretofore, the banker had dealt
+largely with exchange. The industrial leader was his equal if not his
+superior. The<span class='pagenum'><a name="Page_81" id="Page_81">[Pg 81]</a></span> organization of the corporation put the supreme power in
+the hands of the banker, who as the intermediary between investor and
+producer, held the purse strings.</p>
+
+<h3>4. <i>Capitalist against Capitalist</i></h3>
+
+<p>The early American enterprisers&mdash;the pioneers&mdash;began a single-handed
+struggle with nature. Necessity forced them to co&ouml;perate. They
+established a new industry. The factory brought them together. They
+organized their system of industrial direction and control. The
+corporation united them. They turned on one another in mortal combat,
+and the frightfulness of their losses forced them to join hands.</p>
+
+<p>The business men of the late nineteenth century had been nurtured upon
+the idea of competition. "Every man for himself and the devil take the
+hindermost" summed up their philosophy. Each person who entered the
+business arena was met by an array of savage competitors whose motto was
+"Victory or Death." In the struggle that followed, most of them suffered
+death.</p>
+
+<p>Capitalist set himself up against capitalist in bitter strife. The
+railroads gouged the farmers, the manufacturers and the merchants and
+fought one another. The big business organizations drove the little man
+to the wall and then attacked their larger rivals. It was a fight to the
+finish with no quarter asked or given.</p>
+
+<p>The "finish" came with periodic regularity in the seventies, the
+eighties and the nineties. The number of commercial failures in 1875 was
+double the number of 1872. The number of failures in 1878 was over three
+times that of 1871. The same thing happened in the eighties. The
+liabilities of concerns failing in 1884 were nearly four times the
+liabilities of those failing in 1880. The climax came in the nineties,
+after a period of comparative prosperity. Hard times began in 1893.
+Demand dropped off. Production decreased. Unemployment was widespread.
+Wages<span class='pagenum'><a name="Page_82" id="Page_82">[Pg 82]</a></span> fell. Prices went down, down, under bitter competitive selling,
+to touch rock bottom in 1896. Business concerns continued to fight one
+another, though both were going to the wall. Weakened by the struggle,
+unable to meet the competitive price cutting that was all but the
+universal business practice of the time, thousands of business houses
+closed their doors. The effect was cumulative; the fabric of credit,
+broken at one point, was weakened correspondingly in other places and
+the guilty and the innocent were alike plunged into the morass of
+bankruptcy.</p>
+
+<p>The destruction wrought in the business world by the panic of 1893 was
+enormous. The number of commercial failures for 1893 jumped to 15,242.
+The amount of liabilities involved in these failures was $346,780,000.
+This catastrophe, coming as it did so close upon the heels of the panics
+that had immediately preceded it, could not fail to teach its lesson.
+Competition was not the life, but the death of trade. "Every man for
+himself" as a policy applied in the business world, led most of those
+engaged in the struggle over the brink to destruction. There was but one
+way out&mdash;through united action.</p>
+
+<p>The period between 1897 and 1902 was one of feverish activity directed
+to co&ouml;rdinating the affairs of the business world. Trusts were formed in
+all of the important branches of industry and trade. The public looked
+upon the trust as a means of picking pockets through trade conspiracies
+and the boosting of prices. The Sherman Anti-Trust Law had been passed
+on that assumption. In reality, the trusts were organized by far seeing
+men who realized that competition was wasteful in practice and unsound
+in theory. The idea that the failure of one bank or shoe factory was of
+advantage to other banks and shoe factories, had not stood the test of
+experience. The tragedies of the nineties had showed conclusively that
+an injury to one part of the commercial fabric was an injury to all of
+its parts.</p>
+
+<p>The generation of business men trained since 1900 has had no illusions
+about competition. Rather, it has had as its object the successful
+combination of various forms of<span class='pagenum'><a name="Page_83" id="Page_83">[Pg 83]</a></span> business enterprise into ever larger
+units. First, there was the uniting of like industries;&mdash;cotton mills
+were linked with cotton mills, mines with mines. Then came the
+integration of industry&mdash;the concentration under one control of all of
+the steps in the industrial process from the raw material to the
+finished product,&mdash;iron mines, coal mines, blast furnaces, converters,
+and rail mills united in one organization to take the raw material from
+the ground and to turn out the finished steel product. Last of all there
+was the union of unlike industries,&mdash;the control, by one group of
+interests, of as many and as varied activities as could be brought
+together and operated at a profit. The lengths to which business men
+have gone in combining various industries is well shown by the recent
+investigation of the meat packing industry. In the course of that
+investigation, the Federal Trade Commission was able to show that the
+five great packers (Wilson, Armour, Swift, Morris and Cudahy) were
+directly affiliated with 108 business enterprises, including 12
+rendering companies; 18 stockyard companies; 8 terminal railway
+companies; 9 manufacturers of packers' machinery and supplies; 6 cattle
+loan companies; 4 public service corporations; 18 banks, and a number of
+miscellaneous companies, and that they controlled 2000 food products not
+immediately related to the packing industry.<a name="FNanchor_38_38" id="FNanchor_38_38"></a><a href="#Footnote_38_38" class="fnanchor">[38]</a></p>
+
+<p>Business is consolidated because consolidation pays&mdash;not primarily,
+through the increase of prices, but through the greater stability, the
+lessened costs, and the growing security that has accompanied the
+abolition of competition.</p>
+
+<p>Again the forces of social organization have triumphed in the face of an
+almost universal opposition. American business men practiced competition
+until they found that co&ouml;peration was the only possible means of
+conducting large affairs. Theory advised, "Compete"! Experience warned,
+"Combine"! Business men&mdash;like all other practical people&mdash;accepted the
+dictates of experience as the<span class='pagenum'><a name="Page_84" id="Page_84">[Pg 84]</a></span> only sound basis for procedure. Their
+combination solidified their ranks, preparing them to take their places
+in a closely knit, dominant class, with clearly marked interests, and a
+strong feeling of class consciousness and solidarity.</p>
+
+<p>It was in the consummation of these combinations, integrations and
+consolidations that the investment banker came into his own as the
+keystone in the modern industrial arch.</p>
+
+<h3>5. <i>The Investment Banker</i></h3>
+
+<p>The investment banker is the directing and co&ouml;rdinating force in the
+modern business world. The necessities of factory production demanding
+great outlays of capital; the immense financial requirements of
+corporations; the consolidation of business ventures on a huge scale;
+the broadened use of corporate securities as investments&mdash;all brought
+the investment banker into the foreground.</p>
+
+<p>Before the Spanish War, the investment banker financed the trusts. After
+the war he was entrusted with the vast surpluses which the concentration
+of business control had placed in a few hands. Business consolidation
+had given the banker position. The control of the surplus brought him
+power. Henceforth, all who wished access to the world of great
+industrial and commercial affairs must knock at his door.</p>
+
+<p>This concentration of economic control in the hands of a relatively
+small number of investment bankers has been referred to frequently as
+the "Money Trust."</p>
+
+<p>Investment banking monopoly, or as it is sometimes called, the "Money
+Trust" was examined in detail by the Pujo Committee of the House of
+Representatives, which presented a summary of its report on February 28,
+1913. The committee placed, at the center of its diagram of financial
+power, J. P. Morgan &amp; Co., the National City Bank, the First National
+Bank, the Guaranty Trust Co., and the Bankers Trust Co., all of New
+York. The report refers to Lee, Higginson &amp; Co., of Boston and New
+York;<span class='pagenum'><a name="Page_85" id="Page_85">[Pg 85]</a></span> to Kidder, Peabody &amp; Co., of Boston and New York, and to Kuhn,
+Loeb &amp; Co., of New York, together with the Morgan affiliations, as being
+"the most active agents in forwarding and bringing about the
+concentration of control of money and credit" (p. 56).</p>
+
+<p>The methods by which this control was effected are classed by the
+Committee under five heads:&mdash;</p>
+
+<p>1. "Through consolidations of competitive or potentially competitive
+banks and trust companies which consolidations in turn have recently
+been brought under sympathetic management" (p. 56).</p>
+
+<p>2. Through the purchase by the same interests of the stock of
+competitive institutions.</p>
+
+<p>3. Through interlocking directorates.</p>
+
+<p>4. "Through the influence which the more powerful banking houses, banks,
+and trust companies have secured in the management of insurance
+companies, railroads, producing and trading corporations and public
+utility corporations, by means of stock holdings, voting trusts, fiscal
+agency contracts, or representation upon their boards of directors, or
+through supplying the money requirements of railway, industrial, and
+public utility corporations and thereby being enabled to participate in
+the determination of their financial and business policies" (p. 56).</p>
+
+<p>5. "Through partnership or joint account arrangements between a few of
+the leading banking houses, banks, and trust companies in the purchase
+of security issues of the great interstate corporations, accompanied by
+understandings of recent growth&mdash;sometimes called 'banking
+ethics'&mdash;which have had the effect of effectually destroying competition
+between such banking houses, banks, and trust companies in the struggle
+for business or in the purchase and sale of large issues of such securities" (p. 56).</p>
+
+<p>Morgan &amp; Co., the First National Bank, the National City Bank, the
+Bankers Trust Co., and the Guaranty Trust<span class='pagenum'><a name="Page_86" id="Page_86">[Pg 86]</a></span> Co., which were all closely
+affiliated, had extended their control until they held,&mdash;</p>
+
+<blockquote><p>118 directorships in 34 banks with combined resources of
+$2,679,000,000.</p>
+
+<p>30 directorships in 10 insurance companies with total assets of
+$2,293,000,000.</p>
+
+<p>105 directorships in 32 transportation systems having a total
+capital of $11,784,000,000.</p>
+
+<p>63 directorships in 24 producing and trading companies having a
+total capitalization of $3,339,000,000.</p>
+
+<p>25 directorships in 12 public utility corporations with a total
+capitalization of $2,150,000,000.</p></blockquote>
+
+<p>The investment banker had become, what he was ultimately bound to be,
+the center of the system built upon the century-long struggle to control
+the wealth of the continent in the interest of the favored few who
+happened to own the choicest natural gifts.</p>
+
+<h3>6. <i>The Cohesion of Wealth</i></h3>
+
+<p>The struggle for wealth and power, actively waged among the business men
+of the United States for more than a century, has thus by a process of
+elimination, subordination and survival, placed a few small groups of
+strong men in a position of immense economic power. The growth of
+surplus and its importance in the world of affairs has made the
+investment banker the logical center of this business leadership. He,
+with his immediate associates, directs and controls the affairs of the
+economic world.</p>
+
+<p>The spirit of competition ruled the American business world at the
+beginning of the last century, the forces of combination dominated at
+its close. The new order was the product of necessity, not of choice.
+The life of the frontier had ingrained in men an individualism that
+chafed<span class='pagenum'><a name="Page_87" id="Page_87">[Pg 87]</a></span> under the restraints of combination. It was the compelling
+forces of impending calamity and the opportunity for greater economic
+advantage&mdash;not the traditions or accepted standards of the business
+world&mdash;that led to the establishment of the centralized wealth power.
+American business interests were driven together by the battering of
+economic loss and lured by the hope of greater economic gains.</p>
+
+<p>Years of struggle and experience, by converting a scattered,
+individualistic wealth owning class into a highly organized, closely
+knit, homogeneous group with its common interests in the development of
+industry and the safeguarding of property rights, have brought unity and
+power to the business world.</p>
+
+<p>Individually the members of the wealth-controlling class have learned
+that "in union there is strength"; collectively they are gripped by the
+"cohesion of wealth"&mdash;the class conscious instinct of an associated
+group of human beings who have much to gain and everything to lose.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_37_37" id="Footnote_37_37"></a><a href="#FNanchor_37_37"><span class="label">[37]</span></a> The 169 largest railroads in the United States have issued
+84,418,796 shares of stock. ("American Labor Year Book," 1917-18, p.
+169.) Theoretically, therefore, there might be eighty-four millions of
+owners of the American railroads.</p></div>
+
+<div class="footnote"><p><a name="Footnote_38_38" id="Footnote_38_38"></a><a href="#FNanchor_38_38"><span class="label">[38]</span></a> Summary of the Report of the Federal Trade Commission on
+the Meat Packing Industry, July 3, 1918, Wash., Govt. Print., 1918.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_88" id="Page_88">[Pg 88]</a></span></p>
+
+<h2><a name="VIII_THEIR_UNITED_STATES" id="VIII_THEIR_UNITED_STATES"></a>VIII. THEIR UNITED STATES</h2>
+
+<h3>1. <i>Translating Wealth into Power</i></h3>
+
+<p>The first object of the economic struggle is wealth. The second is power.</p>
+
+<p>At the end of their era of competition, the leaders of American business
+found themselves masters of such vast stores of wealth that they were
+released from the paralyzing fear of starvation, and were guaranteed the
+comforts and luxuries of life. Had these men sought wealth as a means of
+satisfying their physical needs their object would have been attained.</p>
+
+<p>The gratification of personal wants is only a minor element in the lives
+of the rich. After they have secured the things desired, they strive for
+the power that will give them control over their fellows.</p>
+
+<p>The possession of things, is, in itself, a narrow field. The control
+over productive machinery gives him who exercises it the power to enjoy
+those things which the workers with machinery produce. The control over
+public affairs and over the forces that shape public opinion give him
+who exercises it the power to direct the thoughts and lives of the
+people. It is for these reasons that the keen, self-assertive, ambitious
+men who have come to the top in the rough and tumble of the business
+struggle have steadily extended their ownership and their control.</p>
+
+<h3>2. <i>The Wealth of the United States</i></h3>
+
+<p>The bulk of American wealth, which consists for the most part of land
+and buildings, is concentrated in the centers of commerce and
+industry&mdash;in the regions of supreme business power.</p>
+
+<p><span class='pagenum'><a name="Page_89" id="Page_89">[Pg 89]</a></span></p><p>The last detailed estimate of the wealth of the United States was made
+by the Census Bureau for the year 1912. At that time, the total wealth
+of the country was placed at $187,739,000,000. (The estimate for 1920 is
+$500,000,000,000.) Roughly speaking, this represented an estimate of
+exchangeable values. The figures, at best, are rough approximations.
+Their importance lies, not in their accuracy, but in the picture which
+they give of relationships.</p>
+
+<p class="tbrk">&nbsp;</p>
+
+<p class="center">The Total Wealth of the United States, Classified by<br />Groups, with the
+Percentage of the Total<br />Wealth in Each Group<a name="FNanchor_39_39" id="FNanchor_39_39"></a><a href="#Footnote_39_39" class="fnanchor">[39]</a></p>
+
+<table summary="Total Wealth of the United States">
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;</td>
+    <td class="center"><i>Total Estimated</i><br /><i>Wealth</i></td>
+  </tr>
+  <tr>
+    <td class="center"><i>Wealth Groups</i></td>
+    <td class="center"><i>Amount</i><br />(000,000<br /><i>Omitted</i>)</td>
+    <td class="center"><i>Per Cent</i><br /><i>of Total</i></td>
+  </tr>
+  <tr>
+    <td>1. Real Property (land and buildings)</td>
+    <td class="right">$110,676</td>
+    <td class="right">59&nbsp; &nbsp; &nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>2. Public Utilities (railroads, street<br />&nbsp; &nbsp; &nbsp; &nbsp;railways, telegraph, telephone,<br />
+&nbsp; &nbsp; &nbsp; &nbsp;electric light, etc.)</td>
+    <td class="right">26,415</td>
+    <td class="right">14&nbsp; &nbsp; &nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>3. Live Stock and Machinery (live<br />&nbsp; &nbsp; &nbsp; &nbsp;stock, farm implements and man-<br />
+&nbsp; &nbsp; &nbsp; &nbsp;ufacturing machinery</td>
+    <td class="right">13,697</td>
+    <td class="right">7&nbsp; &nbsp; &nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>4. Raw Materials, Manufactured Prod-&nbsp; &nbsp;<br />&nbsp; &nbsp; &nbsp; &nbsp;ucts, Merchandise (including<br />
+&nbsp; &nbsp; &nbsp; &nbsp;gold and silver bullion)</td>
+    <td class="right">24,193</td>
+    <td class="right">13&nbsp; &nbsp; &nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>5. Personal Possessions (clothing,<br />&nbsp; &nbsp; &nbsp; &nbsp;personal adornments, furniture,<br />
+&nbsp; &nbsp; &nbsp; &nbsp;carriages, etc.)</td>
+    <td class="right">12,758</td>
+    <td class="right">7&nbsp; &nbsp; &nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td class="right">&mdash;&mdash;&mdash;&mdash;</td>
+    <td class="right">&mdash;&mdash;&nbsp; &nbsp; &nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td class="center">Total of all groups</td>
+    <td class="right">$187,739</td>
+    <td class="right">100&nbsp; &nbsp; &nbsp; &nbsp;</td>
+  </tr>
+</table>
+
+<p class="tbrk">&nbsp;</p>
+
+<p><span class='pagenum'><a name="Page_90" id="Page_90">[Pg 90]</a></span></p><p>The bulk of the exchangeable wealth of the United States consists of
+"productive" or "investment" property. If, to the total of 110 billions
+given by the Census as the value of real property, are added the real
+property values of the public utilities, the total will probably exceed
+three quarters of the total wealth of the United States. If, in
+addition, account is taken of the fact that much of the wealth classed
+as "raw materials, etc.," is the immediate product of the land (coal,
+ore, timber), some idea may be obtained of the extent to which the
+estimated wealth of the country is in the form of land, its immediate
+products, and buildings. Furthermore, it must be remembered that great
+quantities of ore lands, timber lands, waterpower sites, etc., are
+assessed at only a fraction of their total present value.</p>
+
+<p>The personal property of the country is valued at less than one
+fourteenth of the total wealth. It is in reality a negligible item, as
+compared with the value of the real property, of the public utilities,
+and of the raw materials and products of industry.</p>
+
+<p>The wealth of the United States is in permanent form&mdash;land and
+improvements; personal possessions are a mere incident in the total. In
+truth, American wealth is in the main productive (business) wealth,
+designed for the further production of goods, rather than for the
+satisfaction of human wants.</p>
+
+<h3>3. <i>Ownership and Control</i></h3>
+
+<p>Who owns this vast wealth? It is impossible to answer the question with
+anything like definiteness. Figures have been compiled to show that five
+per cent of the people own two-thirds to three-quarters of it; that the
+poorest two-thirds of the people own five per cent of it, and that the
+well-to-do or middle class own the remainder. These figures would make
+it appear that more than one-fourth of the population is in the middle
+class. If the income-tax returns are to be trusted this proportion is
+far too<span class='pagenum'><a name="Page_91" id="Page_91">[Pg 91]</a></span> high. On all hands it is admitted that the wealth of the
+country is concentrated in the hands of a small fraction of the people
+and the important wealth&mdash;that is, the wealth upon which production,
+transportation and exchange depends&mdash;is in still fewer hands.</p>
+
+<p>Neither the total wealth of the country, nor that portion of the total
+which is owned directly by the propertied class is of most immediate
+moment. Ownership does not necessarily involve control. A puddler in the
+Gary Mills may own five shares of stock in the Steel Corporation without
+ever raising his voice to determine the corporation policy. This is
+ownership without control. On the other hand, a banking house through a
+voting trust agreement, may control the policy of a corporation in which
+it does not own one per cent of the stock. This is control without
+ownership. Ownership may be quite incidental. It is control that counts
+in terms of power.</p>
+
+<p>Most of the property owners in the United States play no part in the
+control of prices or of production, in the direction of economic policy,
+or in the management of economic affairs.</p>
+
+<p>Theoretically, stockholders direct the policies of corporations, and,
+therefore, each holder of 5 or 10 shares of corporate stock would play a
+part in deciding economic affairs. Practically, the small stockholder
+has no part in business control.</p>
+
+<p>The small farmer&mdash;the small business man of largest numerical
+consequence&mdash;has been exploited by the great interests for two
+generations. Despite his numbers and his organizations, despite his
+frequent efforts, through anti-trust laws, railway control laws, banking
+reform laws, and the like, he has little voice in determining important
+economic policies.</p>
+
+<p>The small savings bank depositor or the holder of an ordinary insurance
+policy is a negative rather than a positive factor in economic control.
+Not only does he exercise no power over the dollar which he has placed
+with the<span class='pagenum'><a name="Page_92" id="Page_92">[Pg 92]</a></span> bank or with the insurance company, but he has thereby
+strengthened the hands of these organizations. Each dollar placed with
+the financier is a dollar's more power for him and his.</p>
+
+<p>Suppose&mdash;the impossible&mdash;that half of the families in the United States
+"own property." Subtract from this number the small stockholders; the
+holders of bonds, notes and mortgages; the small tradesman; the small
+farmer; the home owner and the owner of a savings-bank deposit or of an
+insurance policy&mdash;what remains? There are the large stockholders, the
+owners and directors of important industries, public utilities, banks,
+trust companies and insurance companies. These persons, in the
+aggregate, constitute a fraction of one per cent of the adult population
+of the United States.</p>
+
+<p>Start with the total non-personal wealth of the country, subtract from
+it the share-values of the small stockholders; the values of all bonds,
+mortgages and notes; the property of the small tradesman and the small
+farmer; the value of homes&mdash;what remains? There are left the stocks in
+the hands of the big stockholders; the properties owned and directed by
+the owners and directors of important industries, public utilities,
+banks, trust companies and insurance companies. This wealth in the
+aggregate probably makes up less than 10 per cent of the total wealth of
+the country and yet the tiny fraction of the population which owns this
+wealth can exercise a dictatorial control over the economic policies
+that underlie American public life.</p>
+
+<h3>4. <i>The Avenues of Mastery</i></h3>
+
+<p>While control rests back directly or indirectly upon some form of
+ownership, most owners exercise little or no control over economic
+affairs. Instead they are made the victims of a social system under
+which one group lives at the expense of another.</p>
+
+<p>Against this tendency toward control by one group or class (usually a
+minority) over the lives of another group<span class='pagenum'><a name="Page_93" id="Page_93">[Pg 93]</a></span> or class (usually a majority)
+the human spirit always has revolted. The United States in its earlier
+years was an embodiment of the spirit of that revolt. President Wilson
+characterized it excellently in 1916. Speaking of the American Flag, he
+said,&mdash;"That flag was originally stained in very precious blood, blood
+spilt, not for any dynasty, nor for any small controversies over
+national advantage, but in order that a little body of three million men
+in America might make sure that no man was their master."<a name="FNanchor_40_40" id="FNanchor_40_40"></a><a href="#Footnote_40_40" class="fnanchor">[40]</a></p>
+
+<p>Against mastery lovers of liberty protest. Mastery means tyranny;
+mastery means slavery.</p>
+
+<p>Mastery has always been based upon some form of ownership. There is in
+the United States a group, growing in size, of people who take more in
+keep than they give in service; people who own land; franchises; stocks
+and bonds and mortgages; real estate and other forms of investment
+property; people who are living without ever lifting a finger in toil,
+or giving anything in labor for an unceasing stream of necessaries,
+comforts and luxuries. These people, directly or indirectly, are the
+owners of the productive machinery of the United States.</p>
+
+<p>Historically there have been a number of stages in the development of
+mastery. First, there was the ownership of the body. One man owned
+another man, as he might own a house or a pile of hides. At another
+stage, the owner of the land&mdash;the feudal baron or the landlord&mdash;said to
+the tenant, who worked on his land: "You stay on my land. You toil and
+work and make bread and I will eat it." The present system of mastery is
+based on the ownership by one group of people, of the productive wealth
+upon which depends the livelihood of all. The masters of present day
+economic society have in their possession the natural resources, the
+tools, the franchises, patents, and the other phases of the modern
+industrial system with which the people must work in order to live. The
+few who own and control the productive wealth have it in their power<span class='pagenum'><a name="Page_94" id="Page_94">[Pg 94]</a></span> to
+say to the many who neither own nor control,&mdash;"You may work or you may
+not work." If the masses obtain work under these conditions the owners
+can say to them further,&mdash;"You work, and toil and earn bread and we will
+eat it." Thus the few, deriving their power from the means by which
+their fellows must work for a living, own the jobs.</p>
+
+<h3>5. <i>The Mastery of Job-Ownership</i></h3>
+
+<p>Job-ownership is the foundation of the latest and probably the most
+complete system of mastery ever perfected. The slave was held only in
+physical bondage. Behind serfdom there was land ownership and a
+religious sanction. "Divine right" and "God's anointed," were terms used
+to bulwark the position of the owning class, who made an effort to
+dominate the consciences as well as the bodies of their serfs.
+Job-ownership owes its effectiveness to a subtle, psychological power
+that overwhelms the unconscious victim, making him a tool, at once easy
+to handle and easy to discard.</p>
+
+<p>The system of private ownership that succeeded Feudalism taught the
+lesson of economic ambition so thoroughly that it has permeated the
+whole world. The conditions of eighteenth century life have passed,
+perhaps forever, but its psychology lingers everywhere.</p>
+
+<p>The job-holder has been taught that he must "get ahead" in the world;
+that if he practices the economic virtues,&mdash;thrift, honesty,
+earnestness, persistence, efficiency&mdash;he will necessarily receive great
+economic reward; that he must support his family on the standard set by
+the community, and that to do all of these essential things, he must
+take a job and hold on to it. Having taken the job, he finds that in
+order to hold it, he must be faithful to the job-owner, even if that
+involves faithlessness to his own ideas and ideals, to his health, his
+manhood, and the lives of his wife and children.</p>
+
+<p><span class='pagenum'><a name="Page_95" id="Page_95">[Pg 95]</a></span></p><p>The driving power in slavery was the lash. Under serfdom it was the
+fear of hunger. The modern system of job-ownership owes its
+effectiveness to the fact that it has been built upon two of the most
+potent driving forces in all the world&mdash;hunger and ambition&mdash;the driving
+force that comes from the empty stomach and the driving force that comes
+from the desire for betterment. Thus job-owning, based upon an automatic
+self-drive principle, enables the job-owner to exact a return in
+faithful service that neither slavery nor serfdom ever made possible.
+Job-owning is thus the most thorough-going form of mastery yet devised
+by the ingenuity of man.</p>
+
+<p>Unlike the slave owner and the Feudal lord the modern job-owner has no
+responsibility to the job-holder. The slave owner must feed, clothe and
+house his slave&mdash;otherwise he lost his property. The Feudal lord must
+protect and assist his tenant. That was a part of his bargain with his
+overlord. The modern job-owner is at liberty, at any time, to
+"discharge" the job-holder, and by throwing him out of work take away
+his chance of earning a living. While he keeps the job-holder on his
+payroll, he may pay him impossibly low wages and overwork him under
+conditions that are unfit for the maintenance of decent human life.
+Barring the factory laws and the health laws, he is at liberty to impose
+on the job-holder any form of treatment that the job-holder will
+tolerate.</p>
+
+<p>There is no limit to the amount of industrial property that one man may
+own. Therefore, there is no limit to the number of jobs he may control.
+It is possible (not immediately likely) that one coterie of men might
+secure possession of enough industrial property to control the jobs of
+all of the gainfully occupied people in American industry. If this
+result could be achieved, these tens of millions would be able to earn a
+living only in case the small coterie in control permitted them to do
+so.</p>
+
+<p>Job ownership is built, of necessity, on the ownership of land,
+resources, capital, credit, franchises, and other special privileges.
+But its power of control goes far <span class='pagenum'><a name="Page_96" id="Page_96">[Pg 96]</a></span>beyond this mere physical ownership
+into the realms of social psychology.</p>
+
+<p>The early colonists, who fled from the economic, political, social and
+religious tyranny of feudalism, believed that liberty and freedom from
+unjust mastery lay in the private ownership of the job. They had no
+thought of the modern industrial machine.</p>
+
+<p>The abolitionists who fought slavery believed that freedom and liberty
+could be obtained by unshackling the body. They did not foresee the
+shackled mind.</p>
+
+<p>The modern world, seeking freedom; yearning for liberty and justice;
+aiming at the overthrow of the mastery that goes with irresponsible
+power, finds to its dismay that the ownership of the job carries with
+it, not only economic mastery, but political, social and even religious
+mastery, as well.</p>
+
+<h3>6. <i>The Ownership of the Product</i></h3>
+
+<p>The industrial overlord holds control of the job with one hand. With the
+other he controls the product of industry. From the time the raw
+material leaves the earth in the form of iron ore, crude petroleum,
+logs, or coal, through all of the processes of production, it is owned
+by the industrial master, not by the worker. Workers separate the
+product from the earth, transport it, refine it, fabricate it. Always,
+the product, like the machinery, is the possession of the owning class.</p>
+
+<p>While industry was competitive, the pressure of competition kept prices
+at a cost level, and the exploiting power of the owner was confined to
+the job-holder. To-day, through combinations and consolidations,
+industry has ceased to be competitive, and the exploiting power of the
+job-owner is extended through his ownership of the product.</p>
+
+<p>The modern town-dweller is almost wholly in the hands of the private
+owners of the products upon which he depends. The ordinary city dweller
+spends two-fifths of<span class='pagenum'><a name="Page_97" id="Page_97">[Pg 97]</a></span> his income for food; one-fifth for rent, fuel and
+light, and one-fifth for clothes. Food, houses, fuel (with the exception
+of gas supply in some cities), and clothing are privately owned. The
+public ownership of streets and water works, of some gas, electricity,
+street cars, and public markets, is a negligible factor in the problem.
+The private monopolist has the upper hand and he is able through the
+control of transportation, storage, and merchandising facilities, to
+make handsome profits for the "service" which he renders the consumer.</p>
+
+<h3>7. <i>The Control of the Surplus</i></h3>
+
+<p>The wealth owners are doubly entrenched. They own the jobs upon which
+most families depend for a living. They own the necessaries of life
+which most families must purchase in order to live. Further, they
+control the surplus wealth of the community.</p>
+
+<p>There are three principal channels of surplus. First of all there is the
+surplus laid aside by business concerns, reinvested in the business,
+spent for new equipment and disposed of in other ways that add to the
+value of the property. Second, there are the 19,103 people in the United
+States with incomes of $50,000 or more per year; the 30,391 people with
+incomes of $25,000 to $50,000 per year and the 12,502 people with
+incomes of $10,000 to $25,000 per year. (Figures for 1917.) Many, if not
+most of these rich people, carry heavy insurance, invest in securities,
+or in some other way add to surplus. In the third place there are the
+small investors, savings-bank depositors, insurance policy holders who,
+from their income, have saved something and have laid it aside for the
+rainy day. The masters of economic life&mdash;bankers, insurance men,
+property holders, business directors&mdash;are in control of all three forms
+of surplus.</p>
+
+<p>The billions of surplus wealth that come each year under the control of
+the masters carry with them an immense authority over the affairs of the
+community. The owners<span class='pagenum'><a name="Page_98" id="Page_98">[Pg 98]</a></span> of wealth owe much of their immediate power to
+the fact that they control this surplus, and are in a position to direct
+its flow into such channels as they may select.</p>
+
+<h3>8. <i>The Channels of Public Opinion</i></h3>
+
+<p>No one can question the control which business interests exercise over
+the jobs, the industrial product, and the economic surplus of the
+community. These facts are universally admitted. But the corollaries
+which flow naturally from such axioms are not so readily accepted. Yet
+given the economic power of the business world, the control over the
+channels of public opinion and over the machinery of government follows
+as a matter of course.</p>
+
+<p>The channels of public opinion&mdash;the school, the press, the pulpit,&mdash;are
+not directly productive of tangible economic goods, yet they depend upon
+tangible economic goods for their maintenance. Whence should these goods
+come? Whence but from the system that produces them, through the men who
+control that system! The plutocracy exercises its power over the
+channels of public opinion in two ways,&mdash;the first, by a direct or
+business office control; and second, by an indirect or social prestige
+control.</p>
+
+<p>The business office control is direct and simple. Schools, colleges,
+newspapers, magazines and churches need money. They cannot produce
+tangible wealth directly, and they must, therefore, depend upon the
+surplus which arises from the productive activities of the economic
+world. Who controls that surplus? Business men. Who, then, is in a
+position to dictate terms in financial matters? Who but the dominant
+forces in business life?</p>
+
+<p>The facts are incontrovertible. It is not mere chance that recruits the
+overwhelming majority of school-board members, college trustees,
+newspaper managers, and church vestrymen, from the ranks of successful
+business and professional men. It is necessary for the educator, the
+journalist, and the minister to work through these men in<span class='pagenum'><a name="Page_99" id="Page_99">[Pg 99]</a></span> order to
+secure the "sinews of war." They are at the focal points of power
+because they control the sources of surplus wealth.</p>
+
+<p>The second method of maintaining control&mdash;through the control of social
+prestige&mdash;is indirect, but none the less effective. The young man in
+college; the young graduate looking for a job; the young man rising in
+his profession, and the man gaining ascendancy in his chosen career are
+brought into constant contact with the "influential" members of the
+business world. It is the business world that dominates the clubs and
+the vacation spots; it is the business world that is met in church, at
+the dinner tables and at the social gathering.</p>
+
+<p>The man who would "succeed" must retain the favor of this group. He does
+so automatically, instinctively or semi-consciously&mdash;it is the common,
+accepted practice and he falls in line.</p>
+
+<p>The masters need not bribe. They need not resort to illegal or unethical
+methods. The ordinary channels of advertising, of business acquaintance
+and patronage, of philanthropy and of social intercourse clinch their
+power over the channels of public opinion.</p>
+
+<h3>9. <i>The Control of Political Machinery</i></h3>
+
+<p>The American government,&mdash;city, state and nation&mdash;is in almost the same
+position as the schools, newspapers and churches. It does not turn out
+tangible, economic products. It depends, for its support, upon taxes
+which are levied, in the first instance, upon property. Who are the
+owners of this property? The business interests. Who, therefore, pay the
+bills of the government? The business interests.</p>
+
+<p>Nowhere has the issue been stated more clearly or more emphatically than
+by Woodrow Wilson in certain passages of his "New Freedom." As a student
+of politics and<span class='pagenum'><a name="Page_100" id="Page_100">[Pg 100]</a></span> government&mdash;particularly the American Government&mdash;he
+sees the power which those who control economic life are able to
+exercise over public affairs, and realizes that their influence has
+grown, until it overtops that of the political world so completely that
+the machinery of politics is under the domination of the organizers and
+directors of industry.</p>
+
+<p>"We know," writes Mr. Wilson in "The New Freedom," "that something
+intervenes between the people of the United States and the control of
+their own affairs at Washington. It is not the people who have been
+ruling there of late" (p. 28). "The masters of the government of the
+United States are the combined capitalists and manufacturers of the
+United States.... Suppose you go to Washington and try to get at your
+government. You will always find that while you are politely listened
+to, the men really consulted are the men who have the biggest
+stakes&mdash;the big bankers, the big manufacturers, the big masters of
+commerce, the heads of railroad corporations and of steamship
+corporations.... Every time it has come to a critical question, these
+gentlemen have been yielded to and their demands have been treated as
+the demands that should be followed as a matter of course. The
+government of the United States at present is a foster-child of the
+special interests" (p. 57-58). "The organization of business has become
+more centralized, vastly more centralized, than the political
+organization of the country itself" (p. 187). "An invisible empire has
+been set up above the forms of democracy" (p. 35). "We are all caught in
+a great economic system which is heartless" (p. 10).</p>
+
+<p>This is the direct control exercised by the plutocracy over the
+machinery of government. Its indirect control is no less important, and
+is exercised in exactly the same way as in the case of the channels of
+public opinion.</p>
+
+<p>Lawyers receive preferment and fees from business&mdash;there is no other
+large source of support for lawyers. Judges are chosen from among these
+same lawyers. Usually they are lawyers who have won preferment and
+<span class='pagenum'><a name="Page_101" id="Page_101">[Pg 101]</a></span>emolument. Legislators are lawyers and business men, or the
+representatives of lawyers and business men. The result is as logical as
+it is inevitable.</p>
+
+<p>The wealth owners control the machinery of government because they pay
+the taxes and provide the campaign funds. They control public officials
+because they have been, are, or hope to be, on the payrolls, or
+participants in the profits of industrial enterprises.</p>
+
+<h3>10. <i>It is "Their United States"</i></h3>
+
+<p>The man fighting for bread has little time to "turn his eyes up to the
+eternal stars." The western cult of efficiency makes no allowances for
+philosophic propensities. Its object is product and it is satisfied with
+nothing short of that sordid goal.</p>
+
+<p>The members of the wealth owning class are relieved from the food
+struggle. Their ownership of the social machinery guarantees them a
+secure income from which they need make no appeal. These privileges
+provide for them and theirs the leisure and the culture that are the
+only possible excuse for the existence of civilization.</p>
+
+<p>The propertied class, because it owns the jobs, the industrial products,
+the social surplus, the channels of public opinion and the political
+machinery also enjoys the opportunity that goes with adequately assured
+income, leisure and culture.</p>
+
+<p>The members of the dominant economic class hold a key&mdash;property
+ownership&mdash;which opens the structure of social wealth. Those who have
+access to this key are the blessed ones. Theirs are the things of this
+world.</p>
+
+<p>The property owners enjoy the fleshpots. They hold the vantage points.
+The vital forces are in their hands. Economically, politically,
+socially, they are supreme.</p>
+
+<p>If the control of material things can make a group secure, the wealth
+owners in the United States are secure. They hold property, prestige,
+power.</p>
+
+<p>The phrase "our United States" as used by the great<span class='pagenum'><a name="Page_102" id="Page_102">[Pg 102]</a></span> majority of the
+people is a misnomer. With the exception of a theoretically valuable but
+practically unimportant right called "freedom of contract," the majority
+of the wage earners in the United States have no more excuse for using
+the phrase "our United States" than the slaves in the South, before the
+war, for saying "our Southland."</p>
+
+<p>The franchise is a potential power, making it theoretically possible for
+the electorate to take possession of the country. In practice, the
+franchise has had no such result. Quite the contrary, the masters of
+American life by a policy of chicanery and misrepresentation, advertise
+and support first one and then the other of the "Old Parties," both of
+which are led by the members of the propertied class or by their
+retainers. The people, deluded by the press, and ignorant of their real
+interests, go to the polls year after year and vote for representatives
+that represent, in all of their interests, the special privileged
+classes.</p>
+
+<p>The economic and social reorganization of the United States during the
+past fifty years has gone fast and far. The system of perpetual (fee
+simple) private ownership of the resources has concentrated the control
+over the natural resources in a small group, not of individuals, but of
+corporations; has created a new form of social master, in the form of a
+land-tool-job owner; has thus made possible a type of
+absentee-landlordism more effective and less human than were any of its
+predecessors and has decreased the responsibility at the same time that
+it has augmented the power of the owning group. These changes have been
+an integral part of a general economic transformation that has occupied
+the chief energies of the ablest men of the community for the past two
+generations.</p>
+
+<p>The country of many farms, villages and towns, and of a few cities, with
+opportunity free and easy of access, has become a country of highly
+organized concentrated wealth power, owned by a small fraction of the
+people and controlled by a tiny minority of the owners for their benefit
+and profit. The country which was rightfully called "our United States"
+in 1840, by 1920 was "their United States" in every important sense of
+the word.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_39_39" id="Footnote_39_39"></a><a href="#FNanchor_39_39"><span class="label">[39]</span></a> "Estimated Valuation of National Wealth, 1850-1912,"
+Bureau of the Census, 1915, p. 15.</p></div>
+
+<div class="footnote"><p><a name="Footnote_40_40" id="Footnote_40_40"></a><a href="#FNanchor_40_40"><span class="label">[40]</span></a> "Addresses of President Wilson," House Doc. 803.
+Sixty-fourth Congress, 1st Session (1916), p. 13.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_103" id="Page_103">[Pg 103]</a></span></p>
+
+<h2><a name="IX_THE_DIVINE_RIGHT_OF_PROPERTY" id="IX_THE_DIVINE_RIGHT_OF_PROPERTY"></a>IX. THE DIVINE RIGHT OF PROPERTY</h2>
+
+<h3>1. <i>Land Ownership and Liberty</i></h3>
+
+<p>The owners of American wealth have been molded gradually into a ruling
+class. Years of brutal, competitive, economic struggle solidified their
+ranks,&mdash;distinguishing friend from enemy; clarifying economic laws, and
+demonstrating the importance of co&ouml;rdination in economic affairs.
+Economic control, once firmly established, opened before the wealth
+owning class an opportunity to dominate the entire field of public life.</p>
+
+<p>Before the property owners could feel secure in their possessions, steps
+must be taken to transmute the popular ideas regarding "property rights"
+into a public opinion that would permit the concentration of important
+property in the hands of a small owning class, at the same time that it
+held to the conviction that society, without privately owned land and
+machinery, was unthinkable.</p>
+
+<p>Many of the leading spirits among the colonists had come to America in
+the hope of realizing the ideal of "Every man a farm, and every farm a
+man." Upon this principle they believed that it would be possible to set
+up the free government which so many were seeking in those dark days of
+the divine right of kings.</p>
+
+<p>For many years after the organization of the Federal Government men
+spoke of the public domain as if it were to last indefinitely. As late
+as 1832 Henry Clay, in a discussion of the public lands, could say, "We
+should rejoice that this bountiful resource possessed by our country,
+remains in almost undiminished quantity." Later in the same speech he
+referred to the public lands as being "liberally offered,&mdash;in
+exhaustless quantities, and at <span class='pagenum'><a name="Page_104" id="Page_104">[Pg 104]</a></span>moderate prices, enriching individuals
+and tending to the rapid improvement of the country."<a name="FNanchor_41_41" id="FNanchor_41_41"></a><a href="#Footnote_41_41" class="fnanchor">[41]</a></p>
+
+<p>The land rose in price as settlers came in greater numbers. Land booms
+developed. Speculation was rife. Efforts were made to secure additional
+concessions from the Government. It was in this debate, where the public
+land was referred to as "refuse land" that Henry Clay felt called upon
+to remind his fellow-legislators of the significance and growing value
+of the public land. He said, "A friend of mine in this city bought in
+Illinois last fall about two thousand acres of this refuse land at the
+minimum price, for which he has lately refused six dollars per acre....
+It is a business, a very profitable business, at which fortunes are made
+in the new states, to purchase these refuse lands and without improving
+them to sell them at large advances."<a name="FNanchor_42_42" id="FNanchor_42_42"></a><a href="#Footnote_42_42" class="fnanchor">[42]</a></p>
+
+<p>A century ago, while it was still almost a wilderness, Illinois began to
+feel the pressure of limited resources&mdash;a pressure which has increased
+to such a point that it has completely revolutionized the system of
+society that was known to the men who established the Government of the
+United States.</p>
+
+<p>This early record of a mid-western land boom, with Illinois land at six
+dollars an acre, tells the story of everything that was to follow. Even
+in 1832 there was not enough of the good land to go around. Already the
+community was dividing itself into two classes&mdash;those who could get good
+land and those who could not. A wise man, understanding the part played
+by economic forces in determining the fate of a people, might have said
+to Henry Clay on that June day in 1832, "Friend, you have pronounced the
+obituary of American liberty."</p>
+
+<p>Some wise man might have spoken thus, but how strange the utterance
+would have sounded! There was so much<span class='pagenum'><a name="Page_105" id="Page_105">[Pg 105]</a></span> land, and all history seemed to
+guarantee the beneficial results that are derived from individual land
+ownership. The democracies of Greece and Rome were built upon such a
+foundation. The yeomanry of England had proved her pride and stay. In
+Europe the free workers in the towns had been the guardians of the
+rights of the people. Throughout historic times, liberty has taken root
+where there is an economic foundation for the freedom which each man
+feels he has a right to demand.</p>
+
+<h3>2. <i>Security of "Acquisitions"</i></h3>
+
+<p>Feudal Europe depended for its living upon agriculture. The Feudal
+System had concentrated the ownership of practically all of the valuable
+agricultural land in the hands of the small group of persons which ruled
+because it controlled economic opportunity. The power of this class
+rested on its ownership of the resource upon which the majority of the
+people depended for a livelihood.</p>
+
+<p>The Feudal System was transplanted to England, but it never took deep
+root there. When in 1215 A. D. (only a century and a half after the
+Great William had made his effort to feudalize England) King John signed
+the Magna Carta, Feudalism proper gave way to landlordism&mdash;the basis of
+English economic life from that time to this.</p>
+
+<p>The system of English landlordism (which showed itself at its worst in
+the absentee landlordism of Ireland) differed from Feudalism in this
+essential respect,&mdash;Feudalism was based upon the idea of the divine
+right of kings. English landlordism was based on the idea of divine
+right of property. English landlordism is the immediate ancestor of the
+property concept that is universally accepted in the business world of
+to-day.</p>
+
+<p>The evils of Feudalism and of landlordism were well known to the
+American colonists who were under the impression that they arose not
+from the fact of ownership, but from the concentration of ownership. The
+resources<span class='pagenum'><a name="Page_106" id="Page_106">[Pg 106]</a></span> of the new world seemed limitless, and the possibility that
+landlordism might show its ugly head on this side of the Atlantic was
+too remote for serious consideration.</p>
+
+<p>With the independence of the United States assured after the War of
+1812; with the growth of industry, and the coming of tens of thousands
+of new settlers, the future of democracy seemed bright. Daniel Webster
+characterized the outlook in 1821 by saying, "A country of such vast
+extent, with such varieties of soil and climate, with so much public
+spirit and private enterprise, with a population increasing so much
+beyond former examples, ... so free in its institutions, so mild in its
+laws, so secure in the title it confers on every man to his own
+acquisitions,&mdash;needs nothing but time and peace to carry it forward to
+almost any point of advancement."<a name="FNanchor_43_43" id="FNanchor_43_43"></a><a href="#Footnote_43_43" class="fnanchor">[43]</a></p>
+
+<p>"So free in its institutions, so mild in its laws, so secure in the
+title it confers on every man to his own acquisitions,"&mdash;the words were
+prophetic. At the moment when they were uttered the forces were busy
+that were destined to realize Webster's dream, on an imperial scale, at
+the expense of the freedom which he prized. Men were free to get what
+they could, and once having secured it, they were safeguarded in its
+possession. Property ownership was a virtue universally commended.
+Constitutions were drawn and laws were framed to guarantee to property
+owners the rights to their property, even in cases where this property
+consisted of the bodies of their fellow men.</p>
+
+<p>The movement toward the protection of property rights has been
+progressive. Webster as a representative of the dominant interests of
+the country a hundred years ago rejoiced that every man had a secure
+title to "his own acquisitions," at a time when the property of the
+country was generally owned by those who had expended some personal
+effort in acquiring it. It was a long step from these personal
+acquisitions to the tens of billions of wealth<span class='pagenum'><a name="Page_107" id="Page_107">[Pg 107]</a></span> in the hands of
+twentieth century American corporations. Daniel Webster helped to bridge
+the gap. He was responsible, at least in part, for the Dartmouth College
+Decision (1816) in which the Supreme Court ruled that a charter, granted
+by a state, is a contract that cannot be modified at will by the state.
+This decision made the corporation, once created and chartered, a free
+agent. Then came the Fourteenth Amendment with its provision that "no
+state shall make or enforce any law which shall abridge the privileges
+or immunities of citizens of the United States; nor shall any state
+deprive any person of life, liberty or property, without due process of
+law." The amendment was intended to benefit negroes. It has been used to
+place property ownership first among the American beatitudes.</p>
+
+<p>Corporations are "persons" in the eyes of the law. When the state of
+California tried to tax the property of the Southern Pacific Railroad at
+a rate different from that which it imposed on persons, the Supreme
+Court declared the law unconstitutional. This decision, coupled with
+that in the Dartmouth College Case secured for a corporation "the same
+immunities as any other person; and since the charter creating a
+corporation is a contract, whose obligation cannot be impaired by the
+one-sided act of a legislature, its constitutional position, as property
+holder, is much stronger than anywhere in Europe." These decisions "have
+had the effect of placing the modern industrial corporation in an almost
+impregnable constitutional position."<a name="FNanchor_44_44" id="FNanchor_44_44"></a><a href="#Footnote_44_44" class="fnanchor">[44]</a></p>
+
+<p>Surrounded by constitutional guarantees, armed with legal privileges and
+prerogatives and employing the language of liberty, the private property
+interests in the United States have gone forward from victory to
+victory, extending their power as they increased and concentrated their
+possessions.</p>
+
+<p><span class='pagenum'><a name="Page_108" id="Page_108">[Pg 108]</a></span></p>
+
+<h3>3. <i>Safeguarding Property Rights</i></h3>
+
+<p>The efforts of Daniel Webster and his contemporaries to protect
+"acquisitions" have been seconded, with extraordinary ability, by
+business organizers, accountants, lawyers and bankers, who have
+broadened the field of their endeavors until it includes not merely
+"acquisitions," but all "property rights." Daniel Webster lived before
+the era of corporations. He thought of "acquisitions" as property
+secured through the personal efforts of the human being who possessed
+it. To-day more than half of the total property and probably more than
+three-quarters of productive wealth is owned by corporations. It
+required ability and foresight to extend the right of "acquisitions" to
+the rights of corporate stocks and bonds. The leaders among the property
+owners possessed the necessary qualifications. They did their work
+masterfully, and to-day corporate property rights are more securely
+protected than were the rights of acquisitions a hundred years ago.</p>
+
+<p>The safeguards that have been thrown about property are simple and
+effective. They arose quite naturally out of the rapidly developing
+structure of industrialism.</p>
+
+<p><i>First</i>&mdash;There was an immense increase in the amount of property and of
+surplus in the hands of the wealth-owning class. After the new industry
+was brought into being with the Industrial Revolution, economic life no
+longer depended so exclusively upon agricultural land. Coal, iron,
+copper, cement, and many other resources could now be utilized, making
+possible a wider field for property rights. Again, the amount of surplus
+that could be produced by one worker, with the assistance of a machine,
+was much greater than under the agricultural system.</p>
+
+<p><i>Second</i>&mdash;The new method of conducting economic affairs gave the
+property owners greater security of possession. Property holders always
+have been fearful that<span class='pagenum'><a name="Page_109" id="Page_109">[Pg 109]</a></span> some fate might overtake their property, forcing
+them into the ranks of the non-possessors. When property was in the form
+of bullion or jewels, the danger of loss was comparatively great. The
+Feudal aristocracy, with its land-holdings, was more secure.
+Land-holdings were also more satisfactory. Jewels and plate do not pay
+any rent, but tenants do. Thus the owner of land had security plus a
+regular income.</p>
+
+<p>The corporation facilitated possession by providing a means (stocks and
+bonds) whereby the property owner was under no obligation other than
+that of clipping coupons or cashing interest checks upon "securities"
+that are matters of public record; issued by corporations that make
+detailed financial reports, and that are subject to vigorous public
+inspection and, in the cases of banks and other financial organizations,
+to the most stringent regulation.</p>
+
+<p><i>Third</i>&mdash;Greater permanence has been secured for property advantages.
+Corporations have perpetual, uninterrupted life. The deaths of persons
+do not affect them. The corporation also overcame the danger of the
+dissipation of property in the process of "three generations from shirt
+sleeves to shirt sleeves." The worthless son of the thrifty parent may
+still be able to squander his inheritance, but that simply means a
+transfer of the title to his stocks and bonds. The property itself
+remains intact.</p>
+
+<p><i>Fourth</i>&mdash;Property has secured a claim on income that is, in the last
+analysis, prior to the claim of the worker.</p>
+
+<p>When a man ran his own business, investing his capital, putting back
+part of his earnings, and taking from the business only what he needed
+for his personal expenses, "profits" were a matter of good fortune.
+There were "good years" and "bad years," when profits were high or low.
+Many years closed with no profit at all. The average farmer still
+handles his business in that way.</p>
+
+<p>The incorporation of business, and the issuing of bonds and stocks has
+revolutionized this situation. It is no longer possible to "wait till
+things pick up." If the business has<span class='pagenum'><a name="Page_110" id="Page_110">[Pg 110]</a></span> issued a million in bonds, at five
+per cent, there is an interest charge of $50,000 that must be met each
+year. There may be no money to lay out for repairs and needed
+improvements, but if the business is to remain solvent, it must pay the
+interest on its bonds.</p>
+
+<p>Businesses that are issuing securities to the public face the same
+situation with regard to their stocks. Wise directors see to it that a
+regular rate, rather than a high rate of dividends, is paid. Regularity
+means greater certainty and stability, hence better consideration from
+the investing public.</p>
+
+<p><i>Fifth</i>&mdash;The practices of the modern economic world have gone far to
+increase the security of property rights.</p>
+
+<p>Business men have worked ardently to "stabilize" business. They have
+insisted upon the importance of "business sanity;" of conservatism in
+finance; of the returns due a man who risks his wealth in a business
+venture; and of the fundamental necessity of maintaining business on a
+sound basis. After centuries of experiment they have evolved what they
+regard as a safe and sane method of financial business procedure. Every
+successful business man tried to live up to the following
+well-established formula.</p>
+
+<p>First, he pays out of his total returns, or gross receipts, the ordinary
+costs of doing business&mdash;materials, labor, repairs and the like. These
+payments are known as running expenses or up-keep.</p>
+
+<p>Second, after up-keep charges are paid he takes the remainder, called
+gross income, and pays out of it the fixed charges&mdash;taxes, insurance,
+interest and depreciation.</p>
+
+<p>Third, the business man, having paid all of the necessary expenses of
+doing business (the running expenses and the fixed charges), has left a
+fund (net income) which, roughly speaking, is the profits of the
+business. Out of this net income, dividends are paid, improvements and
+extensions of the plant are provided for.</p>
+
+<p><span class='pagenum'><a name="Page_111" id="Page_111">[Pg 111]</a></span></p><p>Fourth, the careful business man increases the stability of his
+business by adding something to his surplus or undivided profits.</p>
+
+<p>The operating statistics of the United Steel Corporation for 1918
+illustrate the principle:</p>
+
+<p class="tbrk">&nbsp;</p>
+
+<table summary="operating statistics of the United Steel Corporation for 1918">
+  <tr>
+    <td>1.&nbsp;&nbsp;</td>
+    <td>Gross Receipts</td>
+    <td class="right">$1,744,312,163</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>Manufacturing and Operating expenses&nbsp; &nbsp;</td>
+    <td class="right">&nbsp;</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;&nbsp;including ordinary repairs</td>
+    <td class="right">1,178,032,665</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;</td>
+    <td class="right">&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;</td>
+  </tr>
+  <tr>
+    <td>2.&nbsp;&nbsp;</td>
+    <td>Gross Earnings</td>
+    <td class="right">$&nbsp;&nbsp;566,279,498</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>Other income</td>
+    <td class="right">40,474,823</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;</td>
+    <td class="right">&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;</td>
+    <td class="right">$&nbsp;&nbsp;606,754,321</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>General Expense, (including commission</td>
+    <td class="right">&nbsp;</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;&nbsp;and selling expense, taxes, etc.)</td>
+    <td class="right">337,077,986</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>Interest, depreciation, sinking fund, etc.</td>
+    <td class="right">144,358,958</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;</td>
+    <td class="right">&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;</td>
+  </tr>
+  <tr>
+    <td>3.&nbsp;&nbsp;</td>
+    <td>Net Income</td>
+    <td class="right">$&nbsp;&nbsp;125,317,377</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>Dividends</td>
+    <td class="right">96,382,027</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>&nbsp;</td>
+    <td class="right">&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;</td>
+  </tr>
+  <tr>
+    <td>4.&nbsp;&nbsp;</td>
+    <td>Surplus for the year</td>
+    <td class="right">$&nbsp;&nbsp;&nbsp;&nbsp;28,935,350</td>
+  </tr>
+  <tr>
+    <td>&nbsp;</td>
+    <td>Total surplus</td>
+    <td class="right">460,596,154</td>
+  </tr>
+</table>
+
+<p class="tbrk">&nbsp;</p>
+
+<p>Like every carefully handled business, the Steel Corporation,&mdash;</p>
+
+<blockquote><p>1. Paid its running expenses,</p>
+
+<p>2. Paid its fixed obligations,</p>
+
+<p>3. Divided up its profits,</p>
+
+<p>4. And kept a nest egg.</p></blockquote>
+
+<p>The effectiveness of such means of stabilizing property income is
+illustrated by a compilation (published in the <i>Wall Street Journal</i> for
+August 7th, 1919) of the business of 104 American corporations between
+December 31, 1914, and December 31, 1918. The inventories&mdash;value of
+property owned&mdash;had increased from 1,192 millions to 2,624 millions of
+dollars; the gain in surplus, during the four years,<span class='pagenum'><a name="Page_112" id="Page_112">[Pg 112]</a></span> was 1,941
+millions; the increase in "working capital" was 1,876 millions. These
+corporations, representing only a small fraction of the total business
+of the country, had added billions to their property values during the
+four years.</p>
+
+<p>These various items,&mdash;up-keep; depreciation; insurance; taxes; interest;
+dividends and surplus,&mdash;are recognized universally by legislatures and
+courts as "legitimate" outlays. They, therefore, are elements that are
+always present in the computation of a "fair" price. The cost to the
+consumer of coffee, shoes, meat, blankets, coal and transportation are
+all figured on such a basis. Hence, it will be seen that each time the
+consumer buys a pair of shoes or a pound of meat, he is paying, with
+part of his money, for the stabilizing of property.</p>
+
+<p>Fifth. Property titles under this system are rendered immortal. A
+thousand dollars, invested in 1880 in 5 per cent. 40 year bonds, will
+pay to the owner $2,000 in interest by 1920, at which time the owner
+gets his original thousand back again to be re-invested so long as he
+and his descendants care to do so. The dollar, invested in the business
+of the steel corporation, by the technical processes of bookkeeping, is
+constantly renewed. Not only does it pay a return to the owner, but
+literally, it never dies.</p>
+
+<p>The community is built upon labor. Its processes are continued and its
+wealth is re-created by labor. The men who work on the railroad keep the
+road operating; those who own the railroad owe to it no personal fealty,
+and perform upon it no personal service. If the worker dies, the train
+must stop until he is replaced; if the owner dies, the clerk records a
+change of name in the registry books.</p>
+
+<p>The well-ordered society will encourage work. It will aim to develop
+enthusiasm, to stimulate activity. Nevertheless, in "practical America"
+a scheme of economic organization is being perfected under which the
+cream of life goes to the owners. They have the amplest opportunities.
+They enjoy the first fruits.</p>
+
+<p><span class='pagenum'><a name="Page_113" id="Page_113">[Pg 113]</a></span></p>
+
+<h3>4. <i>Property Rights and Civilization</i></h3>
+
+<p>Under these circumstances, it is easy to see how "the rights of
+property" soon comes to mean the same thing as "civilization," and how
+"the preservation of law and order" is always interpreted as the
+protection of property. With a community organized on a basis which
+renders property rights supreme in all essential particulars, it is but
+natural that the perpetuation of these rights should be regarded as the
+perpetuation of civilization itself.</p>
+
+<p>The present organization of economic life in the United States permits
+the wealth owners through their ownership to live without doing any work
+upon the work done by their fellows. As recipients of property income
+(rent, interest and dividends) they have a return for which they need
+perform no service,&mdash;a return that allows them to "live on their
+income."</p>
+
+<p>The man who fails to assist in productive activity gives nothing of
+himself in return for the food, clothing and shelter which he
+enjoys,&mdash;that is, he lives on the labor of others. Where some have sowed
+and reaped, hammered and drilled, he has regaled himself on the fruits
+of their toil, while never toiling himself.</p>
+
+<p>The matter appears most clearly in the case of an heir to an estate. The
+father dies, leaving his son the title deeds to a piece of city land. If
+he has no confidence in his son's business ability or if his son is a
+minor, he may leave the land in trust, and have it administered in his
+son's interest by some well organized trust company. The father did not
+make the land, though he did buy it. The son neither made nor bought the
+land, it merely came to him; and yet each year he receives a
+rent-payment upon which he is able to live comfortably without doing any
+work. It must at once be apparent that this son of his father,
+economically speaking, performs no function in the community, but merely
+takes from the community an annual toll or rental based on his ownership
+of a part of the<span class='pagenum'><a name="Page_114" id="Page_114">[Pg 114]</a></span> land upon, which his fellowmen depend for a living. Of
+what will this toll consist? Of bread, shoes, motor-cars, cigars, books
+and pictures,&mdash;the products of the labor of other men.</p>
+
+<p>This son of his father is living on his income,&mdash;supported by the labor
+of other people. He performs no labor himself, and yet he is able to
+exist comfortably in a world where all of the things which are consumed
+are the direct or indirect product of the labor of some human being.</p>
+
+<p>Living on one's income is not a new social experience, but it is
+relatively new in the United States. The practice found a reasonably
+effective expression in the feudalism of medieval Europe. It has been
+brought to extraordinary perfection under the industrialism of Twentieth
+Century America.</p>
+
+<p>Imagine the feelings of the early inhabitants of the American colonies
+toward those few gentlemen who set themselves up as economically
+superior beings, and who insisted upon living without any labor, upon
+the labor performed by their fellows. It was against the suggestion of
+such a practice that Captain John Smith vociferated his famous "He that
+will not work, neither shall he eat." The suggestion that some should
+share in the proceeds of community life without participating in the
+hardships that were involved in making a living seemed preposterous in
+those early days.</p>
+
+<p>To-day, living on one's income is accepted in every industrial center of
+the United States as one of the methods of gaining a livelihood. Some
+men and women work for a living. Other men and women own for a living.</p>
+
+<p>Workers are in most cases the humble people of the community. They do
+not live in the finest homes, eat the best food, wear the most elaborate
+clothing, or read, travel and enjoy the most of life.</p>
+
+<p>The owners as a rule are the well-to-do part of the community. They
+derive much of all of their income from<span class='pagenum'><a name="Page_115" id="Page_115">[Pg 115]</a></span> investments. The return which
+they make to the community in services is small when compared with the
+income which they receive from their property holdings.</p>
+
+<p>Living on one's income is becoming as much a part of American economic
+life as living by factory labor, or by mining, or by manufacturing, or
+by any other occupation upon which the community depends for its
+products. The difference between these occupations and living on one's
+income is that they are relatively menial, and it is relatively
+respectable, that is, they have won the disapprobation and it has won
+the approbation of American public opinion.</p>
+
+<p>The best general picture of the economic situation that permits a few
+people to live on their incomes, while the masses of the people work for
+a living, is contained in the reports of the Federal Commissioner of
+Internal Revenue. The figures for 1917 ("Statistics of Income for 1917"
+published August 1919) show that 3,472,890 persons filed returns, making
+one for each six families in the United States. Almost one half of the
+total number of returns made in 1917 were from persons whose income was
+between $1000 and $2000. There were 1,832,132 returns showing incomes of
+$2000 or more, one for each twelve families in the country.</p>
+
+<p>The number of persons receiving the higher incomes is comparatively
+small. There were 270,666 incomes between $5,000 and $10,000; 30,391
+between $10,000 and $25,000; 12,439 between $25,000 and $50,000. There
+were 432,662 returns (22 for each 1000 families in the United States)
+showing incomes of $5,000 or over; there were 161,996 returns (8 returns
+for each 1000 families) showing incomes of $10,000 or over; 49,494
+showing incomes of $25,000 and over; 19,103 showing incomes of $50,000
+and more. Thus the number of moderate and large incomes, compared with
+the total population of the country, was minute.</p>
+
+<p>The portion of the report that is of particular interest, in so far as
+the present study is concerned, is that which presents a division of the
+total net income of those reporting $2,000 or more, into three
+classes&mdash;income from <span class='pagenum'><a name="Page_116" id="Page_116">[Pg 116]</a></span>personal service, income from business profits and
+income from the ownership of property.</p>
+
+<p class="tbrk">&nbsp;</p>
+
+<h4><span class="smcap">Personal Incomes by Sources</span>&mdash;1917</h4>
+
+<table summary="division of total net income">
+  <tr>
+    <td >&nbsp;</td>
+    <td class="center"><i>Amount of</i><br /><i>Income</i></td>
+    <td class="center"> <i>Per Cent</i><br /><i>of Total</i><br /><i>Income</i></td>
+  </tr>
+  <tr>
+    <td class="center"><i>Source</i></td>
+    <td>&nbsp;</td>
+    <td>&nbsp;</td>
+  </tr>
+  <tr>
+    <td>1. Income from personal serv-<br />&nbsp; &nbsp; &nbsp; &nbsp;ice; salaries, wages; com-<br />
+&nbsp; &nbsp; &nbsp; &nbsp;mission, bonuses, director's&nbsp; &nbsp; &nbsp;<br />&nbsp; &nbsp; &nbsp; &nbsp;fees, etc</td>
+    <td class="right">$&nbsp;&nbsp;3,648,437,902</td>
+    <td class="right">30.21</td>
+  </tr>
+  <tr>
+    <td>2. Income from business; busi-<br />&nbsp; &nbsp; &nbsp; &nbsp;ness, trade, commerce,<br />
+&nbsp; &nbsp; &nbsp; &nbsp;partnership, farming, and<br />&nbsp; &nbsp; &nbsp; &nbsp;profits from sales of real<br />
+&nbsp; &nbsp; &nbsp; &nbsp;estate, stocks, bonds, and<br />&nbsp; &nbsp; &nbsp; &nbsp;other property</td>
+    <td class="right">3,958,670,028</td>
+    <td class="right">32.77</td>
+  </tr>
+  <tr>
+    <td>3. Income from property; rents<br />&nbsp; &nbsp; &nbsp; &nbsp;and royalties</td>
+    <td class="right">684,343,399</td>
+    <td class="right">5.67</td>
+  </tr>
+  <tr>
+    <td>&nbsp;&nbsp;&nbsp;&nbsp;Interest on bonds, notes, etc.</td>
+    <td class="right">936,715,456</td>
+    <td class="right">7.76</td>
+  </tr>
+  <tr>
+    <td>&nbsp;&nbsp;&nbsp;&nbsp;Dividends</td>
+    <td class="right">2,848,842,499</td>
+    <td class="right">23.59</td>
+  </tr>
+  <tr>
+    <td>&nbsp;&nbsp;&nbsp;&nbsp;Total from Property</td>
+    <td class="right">4,469,901,354</td>
+    <td class="right">37.02</td>
+  </tr>
+  <tr>
+    <td>4. Total income</td>
+    <td class="right">12,077,009,284</td>
+    <td class="right">100.00</td>
+  </tr>
+</table>
+
+<p class="tbrk">&nbsp;</p>
+
+<p>Those persons who have incomes of $2,000 or more receive 30 cents on the
+dollar in the form of wages and salaries; 33 cents in the form of
+business profits, and 37 cents in the form of incomes from the ownership
+of property. The dividend payments alone&mdash;to this group of property
+owners, are equal to three quarters of the total returns for personal
+service.</p>
+
+<p>These figures refer, of course, to all those in receipt of $2,000 or
+more per year. Obviously, the smaller incomes are in the form of wages,
+salaries, and business profits, while the larger incomes take the form
+of rent, interest and dividends. This is made apparent by a study of the
+detailed tables published in connection with the "Income Statistics for
+1916."</p>
+
+<p><span class='pagenum'><a name="Page_117" id="Page_117">[Pg 117]</a></span></p><p>Among those of small incomes&mdash;$5,000 to $10,000&mdash;nearly half of the
+income was derived from personal services. The proportion of the income
+resulting from personal service diminished steadily as the incomes rose
+until, in the highest income group&mdash;those receiving $2,000,000 or more
+per year, less than one-half of one per cent. was the result of personal
+service while more than 99 per cent. of the incomes came from property ownership.</p>
+
+<p>A small portion of the American people are in receipt of incomes that
+necessitate a report to the revenue officers. Among those persons, a
+small number are in receipt of incomes that might be termed
+large&mdash;incomes of $10,000 or over, for example. Among these persons with
+large incomes the majority of the income is secured in the form of rent,
+interest, dividends and profits. The higher the income group, the larger
+is the percentage of the income that comes from property holdings.</p>
+
+<p>The economic system that exists at the present time in the United States
+places a premium on property ownership. The recipients of the large
+incomes are the holders of the large amounts of property.</p>
+
+<p>Large incomes are property incomes. The rich are rich because they are
+property owners. Furthermore, the organization of present-day business
+makes the owner of property more secure&mdash;far more secure in his income,
+than is the worker who produces the wealth out of which the property
+income is paid.</p>
+
+<h3>5. <i>Plutocracy</i></h3>
+
+<p>The owning class in the United States is established on an economic
+basis,&mdash;the private ownership of the earth. No more solid foundation for
+class integrity and class power has ever been discovered.</p>
+
+<p>The owners of the United States are powerfully entrenched. Operating
+through the corporation, its members have secured possession of the bulk
+of the more useful<span class='pagenum'><a name="Page_118" id="Page_118">[Pg 118]</a></span> resources, the important franchises and the
+productive capital. Where they do not own outright, they control. The
+earth, in America, is the landlords and the fullness thereof. They own
+the productive machinery, and because they own they are able to secure a
+vast annual income in return for their bare ownership.</p>
+
+<p>Families which enjoy property income have one great common
+interest&mdash;that of perpetuating and continuing the property income; hence
+the "cohesion of wealth." "The cohesion of wealth" is a force that welds
+individuals and families who receive property income into a unified
+group or class.</p>
+
+<p>The cohesion of wealth is a force of peculiar social significance. It
+might perhaps be referred to as the class consciousness of the wealthy
+except that it manifests itself among people who have recently acquired
+wealth, more violently, in some cases, than it appears among those whose
+families have possessed wealth for generations. Then, the cohesion of
+wealth is not always an intelligent force. In the case of some persons
+it is largely instinctive.</p>
+
+<p>Originally, the cohesion of wealth expresses itself instinctively among
+a group of wealth owners. They may be competing fiercely as in the case
+of a group of local banks, department stores, or landlords, but let a
+common enemy appear, with a proposition for currency reform, labor
+legislation or land taxation and in a twinkling the conflicting
+interests are thrown to the winds and the property owners are welded
+into a coherent, unified group. This is the beginning of a wealth
+cohesion which develops rapidly into a wealth consciousness.</p>
+
+<p>American business, a generation ago, was highly competitive. Each
+business man's hand was raised against his neighbor and the downfall of
+one was a matter of rejoicing for all. The bitter experience of the
+nineties drove home some lessons; the struggles with labor brought some
+more; the efforts at government regulations had their effect; but most
+of all, the experience of meeting with men in various<span class='pagenum'><a name="Page_119" id="Page_119">[Pg 119]</a></span> lines of business
+and discussing the common problems through the city, state and national
+and business organizations led to a realization of the fact that those
+who owned and managed business had more in common than they had in
+antagonism. By knifing one another they made themselves an easy prey for
+the unions and the government. By pooling ideas and interests they
+presented a solid front to the demands of organized labor and the
+efforts of the public to enforce regulation.</p>
+
+<p>"Plutocracy" means control by those who own wealth. The "plutocratic
+class" consists of that group of persons who control community affairs
+because they own property. This class, because of its property
+ownership, is compelled to devote time and infinite pains to the task of
+safeguarding the sacred rights of property. It is to that task that the
+leaders of the American plutocracy have committed themselves, and it is
+from the results of that accomplished work that they are turning to new
+labors.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_41_41" id="Footnote_41_41"></a><a href="#FNanchor_41_41"><span class="label">[41]</span></a> Speech in the Senate, June 20, 1832. Works Colvin Colton,
+ed. New York, Putnam's, 1904, vol. 7, p. 503.</p></div>
+
+<div class="footnote"><p><a name="Footnote_42_42" id="Footnote_42_42"></a><a href="#FNanchor_42_42"><span class="label">[42]</span></a> Ibid., p. 503.</p></div>
+
+<div class="footnote"><p><a name="Footnote_43_43" id="Footnote_43_43"></a><a href="#FNanchor_43_43"><span class="label">[43]</span></a> "Speeches," E. P. Whipple, ed. Little, Brown &amp; Co., 1910,
+pp. 59-60.</p></div>
+
+<div class="footnote"><p><a name="Footnote_44_44" id="Footnote_44_44"></a><a href="#FNanchor_44_44"><span class="label">[44]</span></a> "The Constitutional Position of Property in America,"
+Arthur T. Hadley, <i>Independent</i>, April 16, 1908.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_120" id="Page_120">[Pg 120]</a></span></p>
+
+<h2><a name="X_INDUSTRIAL_EMPIRES" id="X_INDUSTRIAL_EMPIRES"></a>X. INDUSTRIAL EMPIRES</h2>
+
+<h3>1. <i>They Cannot Pause!</i></h3>
+
+<p>The foundations of Empire have been laid in the United States. Territory
+has been conquered; peoples have been subjugated or annihilated; an
+imperial class has established itself. Here are all of the essential
+characteristics of empire.</p>
+
+<p>The American people have been busy laying the political foundations of
+Empire for three centuries. A great domain, taken by force of arms from
+the people who were in possession of it has been either incorporated
+into the Union, or else held as dependent territory. The aborigines have
+disappeared as a race. The Negroes, kidnaped from their native land,
+enslaved and later liberated, are still treated as an inferior people
+who should be the hewers of wood and the drawers of water. A vast
+territory was taken from Mexico as a result of one war. A quarter
+million square miles were secured from Spain in another; on the
+Continent three and a half millions of square miles; in territorial
+possessions nearly a quarter of a million more&mdash;this is the result of
+little more than two hundred years of struggle; this is the geographic
+basis for the American Empire.</p>
+
+<p>The structure of owning class power is practically complete in the
+United States. Through long years the business interests have evolved a
+form of organization that concentrates the essential power over the
+industrial and financial processes in a very few hands,&mdash;the hands of
+the investment bankers. During this contest for power the plutocracy
+learned the value of the control of public opinion, and brought the
+whole machinery for the direction of public affairs under its
+domination. Thus political and social institutions as well as the
+processes of economic life were<span class='pagenum'><a name="Page_121" id="Page_121">[Pg 121]</a></span> made subject to plutocratic authority.
+A hundred years has sufficed to promulgate ideas of the sacredness of
+private property that place its preservation and protection among the
+chief duties of man. Economic organization; the control of all important
+branches of public affairs, and the elevation of property rights to a
+place among the beatitudes&mdash;by these three means was the authority of
+the plutocracy established and safeguarded.</p>
+
+<p>Since economic political and social power cover the field of authority
+that one human being may exercise over another, it might be supposed
+that the members of the plutocratic class would pause at this point and
+cease their efforts to increase power. But the owners cannot pause! A
+force greater than their wills compels them to go on at an ever growing
+speed. Within the vitals of the economic system upon which it subsists
+the plutocracy has found a source of never-ending torment in the form of
+a constantly increasing surplus.</p>
+
+<h3>2. <i>The Knotty Problem of Surplus</i></h3>
+
+<p>The present system of industry is so organized that the worker is always
+paid less in wages than he creates in product. A part of this difference
+between product and wages goes to the upkeep and expansion of the
+industry in which the worker is employed. Another part in the form of
+interest, dividends, rents, royalties and profits, goes to the owners of
+the land and productive machinery.</p>
+
+<p>The values produced in industry and handed to the industrial worker or
+property owner in the form of income, may be used or "spent" either for
+"consumption goods"&mdash;things that are to be used in satisfying human
+wants, such as street car transportation, clothing, school books, and
+smoking tobacco; or for production goods&mdash;things that are to be used in
+the making of wealth, such as factory buildings, lathes, harvesting
+machinery, railroad equipment. Those who have small incomes necessarily
+spend the greater<span class='pagenum'><a name="Page_122" id="Page_122">[Pg 122]</a></span> part for the consumption of goods upon which their
+existence depends. On the other hand, those who are in receipt of large
+incomes cannot use more than a limited amount of consumption goods.
+Therefore, they are in a position to turn part of their surplus into
+production goods. As a reward for this "saving" the system gives them
+title to an amount of wealth equal to the amount saved, and in addition,
+it grants an amount of "interest" so that the next year the recipient of
+surplus gets the regular share of surplus, and beside that an additional
+reward in the form of interest. His share of the surplus is thus
+increased. That is, surplus breeds surplus.</p>
+
+<p>The workers are, for the most part, spenders. The great bulk of their
+income is turned at once into consumption goods. The owners in many
+instances are capitalists who hold property for the purpose of turning
+the income derived from it into additional investments.</p>
+
+<p>Could the worker buy back dollar for dollar the values which he produces
+there would be no surplus in the form of rent, interest, dividends and
+profits. The present economic system is, however, built upon the
+principle that those who own the lands and the productive machinery
+should be recompensed for their mere ownership. It follows, of course,
+that the more land and machinery there is to own the greater will be the
+amount of surplus which will go to the owners. Since surplus breeds
+surplus the owners find that it pays them not to use all of their income
+in the form of consumption, but rather to invest all that they can,
+thereby increasing the share of surplus that is due them. The worker, on
+the other hand, finds that he must produce a constantly larger amount of
+wealth which he never gets, but which is destined for the payment of
+rent, interest, dividends and profits. Increased incomes yield increased
+investments. Increased investments necessitate the creation and payment
+of increased surplus. The payment of increased surplus means increased
+incomes. Thus the circle is continued&mdash;with the returns heaping up in
+the coffers of the plutocracy.</p>
+
+<p><span class='pagenum'><a name="Page_123" id="Page_123">[Pg 123]</a></span></p><p>Originally the surplus was utilized to free the members of the owning
+class from the grinding drudgery of daily toil, by permitting them to
+enjoy the fruits of the labor of others. Then it was employed in the
+exercise of power over the economic and social machinery. But that was
+not the end&mdash;instead it proved only the beginning. As property titles
+were concentrated in fewer and fewer hands, and the amount of property
+owned by single individuals or groups of individuals becomes greater,
+their incomes (chiefly in the form of rent, interest, dividends and
+profits) rose until by 1917 there were 19,103 persons in the United
+States who declared incomes of $50,000 or more per year, which is the
+equivalent of $1,000 per week. Among these persons 141 declared annual
+incomes of over $1,000,000. Besides these personal incomes, each
+industry which paid these dividends and profits, through its
+depreciation, amortization, replacement, new construction, and surplus
+funds was reinvesting in the industries billions of wealth that would be
+used in the creation of more wealth. The normal processes of the growth
+of the modern economic system has forced upon the masters of life the
+problem of disposing of an ever increasing amount of surplus.</p>
+
+<p>During prosperous periods, the investment funds of a community like
+England and the United States grow very rapidly. The more prosperous the
+nation, the greater is the demand from those who cannot spend their huge
+incomes for safe, paying investment opportunities.</p>
+
+<p>The immense productivity of the present-day system of industry has added
+greatly to the amount of surplus seeking investment. Each invention,
+each labor saving device, each substitution of mechanical power that
+multiplies the productive capacity of industry at the same time
+increases the surplus at the disposal of the plutocracy.</p>
+
+<p>The surplus must be disposed of. There is no other alternative. If hats,
+flour and gasoline are piled up in the warehouses or stored in tanks, no
+more of these commodities will be made until this surplus has been used.
+The whole economic system proceeds on the principle that for each<span class='pagenum'><a name="Page_124" id="Page_124">[Pg 124]</a></span>
+commodity produced, a purchaser must be found before another unit of the
+commodity is ordered. Demand for commodities stimulates and regulates
+the machinery of production.</p>
+
+<p>Those in control of the modern economic system have no choice but to
+produce surplus, and once having produced it, they have no choice except
+to dispose of it. An inexorable fate drives them onward&mdash;augmenting
+their burdens as it multiplies their labors.</p>
+
+<p>Investment opportunities, of necessity, are eagerly sought by the
+plutocracy, since the law of their system is "Invest or perish"!</p>
+
+<p>Invest? Where? Where there is some demand for surplus capital&mdash;that is
+in "undeveloped countries."</p>
+
+<p>The necessity for disposing of surplus has imposed upon the business men
+of the world a classification of all countries as "developed" or
+"undeveloped." "Developed" countries are those in which the capitalist
+processes have gone far enough to produce a surplus that is sufficient
+to provide for the upkeep and for the normal expansion of industry. In
+"developed" countries mines are opened, factories are built, railroads
+are financed, as rapidly as needed, out of the domestic industrial
+surplus. "Undeveloped" countries are those which cannot produce
+sufficient capital for their own needs, and which must, therefore,
+depend for industrial expansion upon investments of capital from the
+countries that do produce a surplus.</p>
+
+<p>"Developed" countries are those in which the modern industrial system
+has been thoroughly established.</p>
+
+<p>The contrast between developed and undeveloped countries is made clear
+by an examination of the investments of any investing nation, such as
+Great Britain. Great Britain in 1913 was surrounded by rich, prosperous
+neighbors&mdash;France, Germany, Holland, Belgium. Each year about a billion
+dollars in English capital was invested outside of the British Isles.
+Where did this wealth go? The chief objectives of British investment,
+aside from the<span class='pagenum'><a name="Page_125" id="Page_125">[Pg 125]</a></span> British Dominions and the United States, were (stated in
+millions of pounds) Argentine 320; Brazil 148; Mexico 99; Russia 67;
+France 8 and Germany 6. The wealth of Germany or France is greater than
+that of Argentine, Brazil and Mexico combined, but Germany and France
+were developed countries, producing enough surplus for their own needs,
+and, therefore, the investable wealth of Great Britain went, not to her
+rich neighbors, but to the poorer lands across the sea.</p>
+
+<p>Each nation that produces an investable surplus&mdash;and in the nature of
+the present economic system, every capitalist nation must some day reach
+the point where it can no longer absorb its own surplus wealth&mdash;must
+find some undeveloped country in which to invest its surplus. Otherwise
+the continuity of the capitalist world is unthinkable. Great Britain,
+Belgium, Holland, France, Germany and Japan all had reached this stage
+before the war. The United States was approaching it rapidly.</p>
+
+<h3>3. <i>"Undeveloped Countries"</i></h3>
+
+<p>Capitalism is so new that the active struggle to secure investment
+opportunities in undeveloped countries is of the most recent origin. The
+voyages which resulted in the discovery, by modern Europeans, of the
+Americas, Australia, Japan, and an easy road to the Orient, were all
+made within 500 years. The actual processes of capitalism are products
+of the past 150 years in England, where they had their origin. In
+France, Germany, Italy and Japan they have existed for less than a
+century. The great burst of economic activity which has pushed the
+United States so rapidly to the fore as a producer of surplus wealth
+dates from the Civil War. Only in the last generation did there arise
+the financial imperialism that results from the necessity of finding a
+market for investable surplus.</p>
+
+<p>The struggle for world trade had been waged for centuries before the
+advent of capitalism, but the struggle for <span class='pagenum'><a name="Page_126" id="Page_126">[Pg 126]</a></span>investment opportunities in
+undeveloped countries is strictly modern. The matter is strikingly
+stated by Amos Pinchot in his "Peace or Armed Peace" (Nov. 11, 1918).</p>
+
+<p>"If you will look at the maps following page 554 of Hazen's 'Europe
+since 1815,' or any other standard colored map showing Africa and Asia
+in 1884, you will see that, but for a few rare spots of coloration, the
+whole continent of Africa is pure white. Crossing the Red Sea into
+Arabia, Persia, Mesopotamia and Asia Minor, you will find the same or
+rather a more complete lack of color. This is merely the cartographer's
+way of showing, by tint and lack of tint, that at that time Africa and
+Western Asia were still in the hands of their native populations.</p>
+
+<p>"Let us now turn to the same maps thirty years later, i.e., in 1914. We
+find them utterly changed. They are no longer white, but a patch work of
+variegated hues....</p>
+
+<p>"From 1870 to 1900, Great Britain added to her possessions, to say
+nothing of her spheres of influence, nearly 5,000,000 square miles with
+an estimated population of 88,000,000. Within a few years after
+England's permanent occupation of Egypt, which was the signal for the
+renaissance of French colonialism, France increased hers by 3,500,000
+square miles with a population of 37,000,000, not counting Morocco added
+in 1911. Germany, whose colonialism came later, because home and nearby
+markets longer absorbed the product of her machines, brought under her
+dominion from 1884 to 1899 1,000,000 square miles with an estimated
+population of 14,000,000."</p>
+
+<p>This is a picture of the political effects that followed the economic
+causes summed up in the term "financial imperialism."</p>
+
+<p>In the seventeenth and eighteenth centuries it was the trader, dealing
+in raw stuff; in the nineteenth century it was the manufacturer,
+producing at low cost to cut under his neighbor's price. During the past
+thirty years the investment banker has occupied the foreground with his
+efforts to find safe, paying opportunities for the disposal of<span class='pagenum'><a name="Page_127" id="Page_127">[Pg 127]</a></span> the
+surplus committed to his care. British bankers, French bankers, German
+bankers, Belgian bankers, Dutch bankers&mdash;all intent upon the same
+mission&mdash;because behind all, and relentlessly driving, were the
+accumulating surpluses, demanding an outlet. European bankers found that
+outlet in Africa, Asia, Australia and the Americas. The stupendous
+strides in the development of the resources in these countries would
+have been impossible but for that surplus of European capital.</p>
+
+<p>The undeveloped countries to-day have the same characteristics,&mdash;virgin
+resources, industrial and commercial possibilities, and in many cases
+cheap labor. This is true, for example, in China, Mexico and India. It
+is true to a less extent in South America and South Africa. The logical
+destination of capital is the point where the investment will "pay."</p>
+
+<p>The investor who has used up the cream of the home investment market
+turns his eyes abroad. As a recent writer has suggested, "There is a
+glamor about the foreign investment" which does not hold for a domestic
+one. Foreign investments have yielded such huge returns in the past that
+there is always a seeming possibility of wonderful gains for the future.
+The risk is greater, of course, but this is more than offset by the
+increased rate of return. If it were not so, the wealth would be
+invested at home or held idle.</p>
+
+<h3>4. <i>The Great Investing Nations</i></h3>
+
+<p>The great industrial nations are the great investing nations. An
+agriculture community produces little surplus wealth. Land values are
+low, franchises and special privileges are negligible factors. There can
+be relatively little speculation. Changes in method of production are
+infrequent. Changes in values and total wealth are gradual. The owning
+class in an agriculture civilization may live comfortably. If it is very
+small in proportion to the total population it may live luxuriously, but
+it cannot derive<span class='pagenum'><a name="Page_128" id="Page_128">[Pg 128]</a></span> great revenues such as those secured by the owning
+classes of an industrial civilization.</p>
+
+<p>Industrial civilization possesses all of the factors for augmenting
+surplus wealth which are lacking in agricultural civilizations. Changes
+in the forms of industrial production are rapid; special privilege
+yields rich returns and is the subject of wide speculative activity;
+land values increase; labor saving machinery multiplies man's capacity
+to turn out wealth. As much surplus wealth might be produced in a year
+of this industrial life as could have been turned out in a generation or
+a century of agricultural activity or of hand-craft industry.</p>
+
+<p>England, France, Germany, Holland, Belgium, Japan and the United States,
+the great industrial nations, have become the great lending nations.
+Their search for "undeveloped territory" and "spheres of influence" is
+not a search for trade, but for an opportunity to invest and exploit. If
+these nations wished to exchange cotton for coffee, or machinery for
+wheat on even terms, they could exchange with one another, or with one
+of the undeveloped countries, but they demand an outlet for surplus
+wealth&mdash;an outlet that can only be utilized where the government of the
+developed country will guarantee the investment of its citizens in the
+undeveloped territory.</p>
+
+<p>The investing nations either want to take the raw products of the
+undeveloped country, manufacture them and sell them back as finished
+material (the British policy in India), or else they desire to secure
+possession of the resources, franchises and other special privileges in
+the undeveloped country which they can exploit for their own profit (the
+British policy in South America).</p>
+
+<p>The Indians, under the British policy, are thus in relatively the same
+position as the workers in one of the industrial countries. They are
+paid for their raw material a fraction of the value of the finished
+product. They are expected to buy back the finished product, which is a
+manifest impossibility. There is thus a drastic limitation on the<span class='pagenum'><a name="Page_129" id="Page_129">[Pg 129]</a></span>
+exploitation of undeveloped countries, just as there is a limitation on
+the exploitation of domestic labor. In both cases the people as
+consumers can buy back less in value than the exploiters have to sell.
+Obviously the time must come when all the undeveloped sections of the
+world have been exploited to the limit. Then surplus will go a-begging.</p>
+
+<p>Some of the investors in the great exploiting nations have abandoned the
+idea of making huge returns by way of the English policy in India.
+Instead the investors in every nation are buying up resources,
+franchises and concessions and other special privileges in the
+undeveloped countries and treating them in exactly the same way that
+they would treat a domestic investment. In this case the resources and
+labor of the undeveloped country are exploited for the profit of the
+foreign investor.</p>
+
+<p>The Roman conquerors subjugated the people politically and then exacted
+an economic return in the form of tribute. The modern imperialists do
+not bother about the political machinery, so long as it remains in
+abeyance, but content themselves with securing possession of the
+economic resources of a region and exacting a return in interest and
+dividends on the investment. Political tribute is largely a thing of the
+past. In its place there is a new form&mdash;economic tribute&mdash;which is
+safer, cheaper, and on the whole far superior to the Roman method of
+exploiting undeveloped regions.</p>
+
+<h3>5. <i>The American Home Field</i></h3>
+
+<p>A hundred years ago the United States was an undeveloped country. Its
+resources were virgin. Its wealth possibilities were immense. Both
+domestic and foreign capitalists invested large sums in the canals, the
+railroads and other American commercial and industrial enterprises. The
+rapid economic expansion of recent years has involved the outlay of huge
+sums of new capital.</p>
+
+<p>The total capital invested in manufactures was 8,975 millions in 1899
+and 22,791 millions in 1914. The total<span class='pagenum'><a name="Page_130" id="Page_130">[Pg 130]</a></span> of railway capital was 11,034
+millions in 1899 and 20,247 millions in 1914. Manufacturing and
+railroading alone secured a capital outlay of over 20 billions in 15
+years. Some idea of the increase in investments may be gained from the
+amount of new stocks and bonds listed annually on the New York Stock
+Exchange. The total amount of new stocks listed for the five years
+ending with 1914 was 1,420 millions; the total of new bonds was 2,226
+million. (<i>The Financial Review Annual</i>, 1918, p. 67.) The total capital
+of new companies (with an authorized capital of at least $100,000) was
+in 1918, $2,599,753,600; in 1919, $12,677,229,600, and in the first 10
+months of 1920, $12,242,577,700. (Bradstreets, Nov. 6, 1920, p. 731.)
+The figures showing the amount of stocks and bonds issued do not by any
+means exhaust the field of new capital. Reference has already been made
+to the fact that the United States Steel Corporation, between 1903 and
+1918 increased its issues of stocks and bonds by only $31,600,000,
+while, in the same time its assets increased $987,000,000. The same fact
+is illustrated, on a larger scale, in a summary (<i>Wall Street Journal</i>,
+August 7, 1919) of the finances of 104 corporations covering the four
+years, December 31, 1914, to December 31, 1918. During this time, six of
+the leading steel companies of the United States increased their working
+capital by $461,965,000 and their surplus by $617,656,000. This billion
+was taken out of the earnings of the companies. Concerning the entire
+104 corporations, the <i>Journal</i> notes that, "After heavy expenditures
+for new construction and acquisitions, and record breaking dividends,
+they added a total of nearly $2,000,000,000 to working capital." In
+addition, these corporations, in four years, showed a gain of
+$1,941,498,000 in surplus and a gain in inventories of $1,522,000,000.</p>
+
+<p>Considerable amounts of capital are invested in private industry, by
+individuals and partnerships. No record of these investments ever
+appears. Farmers invest in animals, machinery and improved
+buildings&mdash;investments that are not represented by stocks or bonds.
+Again, the great corporations themselves are constantly adding to their
+<span class='pagenum'><a name="Page_131" id="Page_131">[Pg 131]</a></span>assets without increasing their stock or bond issues. In these and
+other ways, billions of new capital are yearly absorbed by the home
+investment market.</p>
+
+<p>Although most of the enterprises of the United States have been floated
+with American capital, the investors of Great Britain, Holland, France
+and other countries took a hand. In 1913 the capitalists of Great
+Britain had larger investments in the United States than in any other
+country, or than in any British Dominion. (The U. S., 754,617,000
+pounds; Canada and Newfoundland, 514,870,000 pounds; India and Ceylon,
+378,776,000 pounds; South Africa, 370,192,000 pounds and so on.)
+(<i>Annals</i>, 1916, Vol. 68, p. 28, Article by C. K. Hobson.) The aggregate
+amount of European capital invested in the United States was
+approximately $6,500,000,000 in 1910. Of this sum more than half was
+British. ("Trade Balance of the United States," George Paisch. National
+Monetary Commission, 1910, p. 175.)</p>
+
+<p>By the beginning of the present century (the U. S. Steel Corporation was
+organized in 1901) the main work of organization inside of the United
+States was completed. The bankers had some incidental tasks before them,
+but the industrial leaders themselves had done their pioneer duty. There
+were corners to be smoothed off, and bearings to be rubbed down, but the
+great structural problems had been solved, and the foundations of world
+industrial empire had been laid.</p>
+
+<h3>6. <i>Leaving the Home Field</i></h3>
+
+<p>The Spanish-American War marks the beginning of the new era in American
+business organization. This war found the American people isolated and
+provincial. It left them with a new feeling for their own importance.</p>
+
+<p>The worlds at home had been conquered. The transcontinental railroads
+had been built; the steel industry, the oil industry, the coal industry,
+the leather industry, the woolen industry and a host of others had been
+organized<span class='pagenum'><a name="Page_132" id="Page_132">[Pg 132]</a></span> by a whole generation of industrial organizers who had given
+their lives to this task.</p>
+
+<p>Across the borders of the United States&mdash;almost within arm's reach of
+the eager, stirring, high-strung men of the new generation, there were
+tens of thousands of square miles of undeveloped territory&mdash;territory
+that was fabulously rich in ore, in timber, in oil, in fertility. On
+every side the lands stretched away&mdash;Mexico, the West Indies, Central
+America, Canada&mdash;with opportunity that was to be had for the taking.</p>
+
+<p>Opportunity called. Capital, seeking new fields for investment, urged.
+Youth, enthusiasm and enterprise answered the challenge.</p>
+
+<p>The foreign investments of the United States at the time of the
+Spanish-American War were negligible. By 1910 American business men had
+two billions invested abroad&mdash;$700,000,000 in Mexico; $500,000,000 in
+Canada; $350,000,000 in Europe, and smaller sums in the West Indies, the
+Philippines, China, Central and South America. In 1913 there was a
+billion invested in Mexico and an equal amount in Canada. ("Commercial
+Policy," W. S. Culbertson, New York, Appleton, 1919, p. 315.)</p>
+
+<p>Capital flowed out of the United States in two directions:</p>
+
+<blockquote><p>1. Toward the resources which were so abundant in certain foreign
+countries.</p>
+
+<p>2. Toward foreign markets.</p></blockquote>
+
+<h3>7. <i>Building on Foreign Resources</i></h3>
+
+<p>The Bethlehem Steel Corporation is a typical industry that has built up
+foreign connections as a means of exploiting foreign resources. The
+Corporation has a huge organization in the United States which includes
+10 manufacturing plants, a coke producing company, 11 ship building
+plants, six mines and quarries, and extensive coal deposits in
+Pennsylvania and West Virginia. The Bethlehem Steel Corporation also
+controls ore properties near <span class='pagenum'><a name="Page_133" id="Page_133">[Pg 133]</a></span>Santiago, Cuba, near Nipe Bay, Cuba, and
+extensive deposits along the northern coast of Cuba; large ore
+properties at Tofo, Chile, and the Ore Steamship Corporation, a carrying
+line for Chilean and Cuban ore.</p>
+
+<p>The American Smelting and Refining Company is another illustration of
+expansion into a foreign country for the purpose of utilizing foreign
+resources. According to the record of the Company's properties, the
+Company was operating six refining plants, one located in New Jersey;
+one in Nebraska; one in California; one in Illinois; one in Maryland,
+and one in Washington. The Company owned 14 lead smelters and 11 copper
+smelters, located as follows: Colorado, 4; Utah, 2; Texas, 2; Arizona,
+2; New Jersey, 2; Montana, 1; Washington, 1; Nebraska, 1; California, 1;
+Illinois, 1; Chile, 2; Mexico, 6. Among these 25 plants a third is
+located outside of the United States.</p>
+
+<p>These are but two examples. The rubber, oil, tobacco and sugar interests
+have pursued a similar policy&mdash;extending their organization in such a
+way as to utilize foreign resources as a source for the raw materials
+that are destined to be manufactured in the United States.</p>
+
+<h3>8. <i>Manufacturing and Marketing Abroad</i></h3>
+
+<p>The Bethlehem Steel Corporation and the American Smelting and Refining
+Company go outside of the United States for the resources upon which
+their industries depend. Their fabricating industries are carried on
+inside of the country. There are a number of the great industries of the
+country that have gone outside of the United States to do their
+manufacturing and to organize the marketing of their products.</p>
+
+<p>The International Harvester Company has built a worldwide organization.
+It manufactures harvesting machinery, farm implements, gasoline engines,
+tractors, wagons and separators at Springfield, Ohio; Rock Falls, Ill.;
+Chicago, Ill.; Auburn, New York; Akron, Ohio; Milwaukee, Wisc.,<span class='pagenum'><a name="Page_134" id="Page_134">[Pg 134]</a></span> and
+West Pullman, Ill. It has iron mines, coal mines and steel plants
+operated by the Wisconsin Steel Company. It has three twine mills and
+four railways. Foreign plants and branches are listed as follows:
+Norrkoping, Sweden; Copenhagen, Denmark; Christiania, Norway; Paris,
+France; Croix, France; Berlin, Germany; Hamilton, Ontario, Canada;
+Zurich, Switzerland; Vienna, Austria; Lubertzy, Russia; Neuss, Germany;
+Melbourne, Australia; London, England; Christ Church, New Zealand.</p>
+
+<p>One of the greatest industrial empires in the world is the Standard Oil
+Properties. It is not possible to go into detail with regard to their
+operations. Space will admit of a brief comment upon one of the
+constituent parts or "states" of the empire&mdash;The Standard Oil Company of
+New Jersey. With a capital stock of $100,000,000, this Company, from the
+dissolution of the Standard Oil Company, December 15, 1911, to June 15,
+1918, a period of six and a half years, paid dividends of $174,058,932.</p>
+
+<p>The company describes itself as "a manufacturing enterprise with a large
+foreign business. The company drills oil wells, pumps them, refines the
+crude oil into many forms and sells the product&mdash;mostly abroad." (<i>The
+Lamp</i>, May, 1918.) The properties of the Company are thus listed:</p>
+
+<p>1. The Company has 13 refineries, seven of them in New Jersey, Maryland,
+Oklahoma, Louisiana and West Virginia. Four of the remaining refineries
+are located in Canada, one is in Mexico and one in Peru.</p>
+
+<p>2. Pipeline properties in New York, New Jersey, Pennsylvania and
+Maryland.</p>
+
+<p>3. A fleet of 54 ocean-going tank steamers with a capacity of 486,480
+dead weight tons. (This is about two per cent of the total ocean-going
+tonnage of the world.)</p>
+
+<p>4. Can and case factories, barrel factories, canning plants, glue
+factories and pipe shops.</p>
+
+<p>5. Through its subsidiary corporations, the Company controls:</p>
+
+<p><span class='pagenum'><a name="Page_135" id="Page_135">[Pg 135]</a></span></p><p>a. Oil wells in Pennsylvania, West Virginia, Ohio, Kentucky, Louisiana,
+Arkansas, Mississippi, Texas, California, Peru and Mexico. In connection
+with many of these properties refineries are operated.</p>
+
+<p>b. One subsidiary has 550 marketing stations in Canada. Others market in
+various parts of the United States; in the West Indies; in Central and
+South America; in Germany, Austria, Roumania, the Netherlands, France,
+Denmark and Italy.</p>
+
+<p>The Standard Oil Company of New Jersey comprises only one part&mdash;though a
+very successful part&mdash;of the Standard Oil Group of industries. It is one
+industrial state in a great industrial empire.</p>
+
+<p>Foreign resources offer opportunities to the exploiter. Foreign markets
+beckon. Both calls have been heeded by the American business interests
+that are busy building the international machinery of business
+organization.</p>
+
+<h3>9. <i>International Business and Finance</i></h3>
+
+<p>The steel, smelting, oil, sugar, tobacco, and harvester interests are
+confined to relatively narrow lines. In their wake have followed general
+business, and above all, financial activities.</p>
+
+<p>The American International Corporation was described by its
+vice-president (Mr. Connick) before a Senate Committee on March 1, 1918.
+"Until the Russian situation became too acute, they had offices in
+Petrograd, London, Paris, Rome, Mexico City. They sent commissions and
+agents and business men to South America to promote trade.... They were
+negotiating contracts for a thousand miles of railroad in China. They
+were practically rebuilding, you might say, the Grand Canal in China.
+They had acquired the Pacific Mail.... They then bought the New York
+Shipbuilding Corporation to provide ships for their shipping interests."</p>
+
+<p><span class='pagenum'><a name="Page_136" id="Page_136">[Pg 136]</a></span></p><p>By 1919 (<i>New York Times</i>, Oct. 31, 1919) the Company had acquired
+Carter Macy &amp; Co., and the Rosin and Turpentine Export Co., and was
+interested in the International Mercantile Marine and the United Fruit
+Companies.</p>
+
+<p>Another illustration of the same kind of general foreign business
+appeared in the form of an advertisement inserted on the financial page
+of the <i>New York Times</i> (July 10, 1919) by three leading financial
+firms, which called attention to a $3,000,000 note issue of the Haytian
+American Corporation "Incorporated under the laws of the State of New
+York, owning and operating sugar, railroad, wharf and public utility
+companies in the Republic of Hayti." Further, the advertisers note: "The
+diversity of the Company's operations assures stability of earnings."</p>
+
+<p>American manufacturers, traders and industrial empire builders have not
+gone alone into the foreign field. The bankers have accompanied them.</p>
+
+<p>Several of the great financial institutions of the country are
+advertising their foreign connections.</p>
+
+<p>The Guaranty Trust Company (<i>New York Times</i>, Jan. 10, 1919) advertises
+under the caption "Direct Foreign Banking Facilities" offering "a direct
+and comprehensive banking service for trade with all countries." These
+connections include:</p>
+
+<p>1. Branches in London and Paris, which are designated United States
+depositories. "They are American institutions conducted on American
+lines, and are especially well equipped to render banking service
+throughout Europe." There are additional branches in Liverpool and
+Brussels. The Company also has direct connections in Italy and Spain,
+and representatives in the Scandinavian countries.</p>
+
+<p>2. "Direct connections with the leading financial institutions in
+Argentina, Uruguay, Chile, and Brazil." A special representative in
+Buenos Ayres. "Through our affiliation with the Mercantile Bank of the
+Americas and its connections, we cover Peru, Northern Brazil, Columbia,<span class='pagenum'><a name="Page_137" id="Page_137">[Pg 137]</a></span>
+Ecuador, Venezuela, Nicaragua, Honduras, Guatemala, and other South and
+Central American countries."</p>
+
+<p>3. "Through the American Mercantile Bank of Cuba, at Havana, we cover
+direct Cuba and the West Indies."</p>
+
+<p>4. "Direct banking and merchant service throughout British India,"
+together with correspondents in the East Indies and the Straits
+Settlements.</p>
+
+<p>5. "Direct connections with the National Bank of South Africa, at Cape
+Town, and its many branches in the Transvaal, Rhodesia, Natal,
+Mozambique, etc."</p>
+
+<p>6. Direct banking connections and a special representative in Australia
+and New Zealand.</p>
+
+<p>7. "Through our affiliations with the Asia Banking Corporation we
+negotiate, direct, banking transactions of every nature in China,
+Manchuria, Southeastern Siberia, and throughout the Far East. The Asia
+Banking Corporation has its main office in New York and is establishing
+branches in these important trade centers: Shanghai, Pekin, Tientsin,
+Hankow, Harbin, Vladivostok. We are also official correspondents for
+leading Japanese banks."</p>
+
+<p>The advertisement concludes with this statement: "Our Foreign Trade
+Bureau collects and makes available accurate and up-to-date information
+relating to foreign trade&mdash;export markets, foreign financial and
+economic conditions, shipping facilities, export technique, etc. It
+endeavors to bring into touch buyers and sellers here and abroad."</p>
+
+<p>The same issue of the <i>Times</i> carries a statement of the Mercantile Bank
+of the Americas which "offers the services of a banking organization
+with branches and affiliated banks in important trade centers throughout
+Central and South America, France and Spain." The Bank describes itself
+as "an American Bank for Foreign trade." Among its eleven directors are
+the President and two Vice-Presidents of the Guaranty Trust Company.</p>
+
+<p>The Asia Banking Corporation, upon which the Guaranty Trust Company
+relies for its Eastern connections, was organized in 1918 "to engage in
+international and foreign<span class='pagenum'><a name="Page_138" id="Page_138">[Pg 138]</a></span> banking in China, in the dependencies and
+insular possessions of the United States, and, ultimately in Siberia"
+(<i>Standard Corporation Service</i>, May-August, 1918, p. 42). The officers
+elected in August 1918, were Charles H. Sabin, President of the Guaranty
+Trust Co., President; Albert Breton, Vice-President of the Guaranty
+Trust Co., and Ralph Dawson, Assistant Secretary of the Guaranty Trust
+Company, Vice-Presidents, and Robert A. Shaw, of the overseas division
+of the Guaranty Trust Company, Treasurer. Among the directors are
+representatives of the Bankers Trust Company and of the Mercantile Bank
+of the Americas.</p>
+
+<h3>10. <i>The National City Bank</i></h3>
+
+<p>The National City Bank of New York&mdash;the first bank in the history of the
+Western Hemisphere to show resources exceeding one billion
+dollars&mdash;illustrates in its development the cyclonic changes that the
+past few years have brought into American business circles. The National
+City Bank, originally chartered in 1812, had resources of $16,750,929 in
+1879 and of $18,214,823 in 1889. From that point its development has
+been electric. The resources of the Bank totaled 128 millions in 1899;
+280 millions in 1909; $1,039,418,324 in 1919. Between 1889 and 1899 they
+increased 600 per cent; between 1899 and 1919 they increased 700 per
+cent; during the 40 years from 1889 and 1919 the increase in resources
+exceeded six thousand per cent.</p>
+
+<p>The organization of the Bank is indicative of the organization of modern
+business. Among the twenty-one directors, all of whom are engaged in
+some form of business enterprise, there are the names of William
+Rockefeller, Percy A. Rockefeller, J. Ogden Armour, Cleveland H. Dodge
+of the Phelps-Dodge Corporation, Cyrus H. McCormick of the International
+Harvester Co., Philip A. S. Franklin, President of the International
+Mercantile Marine Co.; Earl D. Babst, President of the American Sugar
+Refining Co.; Edgar Palmer, President of the New Jersey<span class='pagenum'><a name="Page_139" id="Page_139">[Pg 139]</a></span> Zinc Co.;
+Nathan C. Kingsbury, Vice-President of the Union Pacific Railroad Co.,
+and Frank Krumball, Chairman of the Chesapeake &amp; Ohio Railroad Co. Some
+of the most powerful mining, manufacturing, transportation and public
+utility interests in the United States are represented, directly or
+indirectly, in this list.</p>
+
+<p>The domestic organization of the Bank consists of five divisions, each
+one under a vice-president. New York City constitutes the first
+division; the second division comprises New England and New York State
+outside of New York City; the three remaining divisions cover the other
+portions of the United States. Except for the size and the completeness
+of its organization, the National City Bank differs in no essential
+particulars from numerous other large banking institutions. It is a
+financial superstructure built upon a massive foundation of industrial
+enterprise.</p>
+
+<p>The phase of the Bank's activity that is of peculiar significance at the
+present juncture is its foreign organization, all of which has been
+established since the outbreak of the European war.</p>
+
+<p>The foreign business of the National City Bank is carried on by the
+National City Bank proper and the International Banking Corporation. The
+first foreign branch of the National City Bank was established at Buenos
+Aires on November 10th, 1914. On January 1st, 1919, the National City
+Bank had a total of 15 foreign branches; on December 31st, 1919, it had
+a total of 74 foreign branches.</p>
+
+<p>The policy of the Bank in its establishment of foreign branches is
+described thus in its "Statement of Condition, December 31st, 1919":
+"The feature of branch development during the year was the expansion in
+Cuba, where twenty-two new branches were opened, making twenty-four in
+the island. Cuba is very prosperous, as a result of the expansion of the
+sugar industry, and as sugar is produced there under very favorable
+conditions economically, and the location is most convenient for
+supplying the United States, the industry is on a sound basis, and
+relations with the<span class='pagenum'><a name="Page_140" id="Page_140">[Pg 140]</a></span> United States are likely to continue close and
+friendly. Cuba is a market of growing importance to the United States,
+and the system of branches established by the Bank is designed to serve
+the trade between the two countries." The trader and the Banker are to
+work hand in hand.</p>
+
+<p>The National City Bank has branches in Argentina, Brazil, Belgium,
+Chile, Colombia, Cuba, Italy, Porto Rico, Russia, Siberia, Spain,
+Trinidad, Uruguay and Venezuela, all of which have been established
+since 1914.</p>
+
+<p>A portion of the foreign business of the National City Bank is conducted
+by the International Banking Corporation which was established in 1902
+and which became a part of the National City Bank organization in 1915.
+The International Banking Corporation has a total of twenty-eight
+branches located in California, China, England, France, India, Japan,
+Java, Dominican Republic, Philippine Islands, Republic of Panama and the
+Straits Settlements. Under this arrangement, the financial relations
+with America are made by the National City Bank proper; while those with
+Europe and Asia are in the hands of the International Banking
+Corporation and the combination provides the Bank with 75 branches in
+addition to its vast organization within the United States.</p>
+
+<p>The National City Bank of 1889, with its resources of eighteen millions,
+was a small affair compared with the billion dollar resources of 1920.
+Thirty years sufficed for a growth from youth to robust adulthood.
+Within five years, the Bank built up a system of foreign branches that
+make it one of the most potent States in the federation of international
+financial institutions.</p>
+
+<h3>11. <i>Onward</i></h3>
+
+<p>Exploiters of foreign resources, manufacturers, traders and bankers have
+moved, side by side, out of the United States into the foreign field.
+Step by step they have advanced, rearing the economic structure of
+empire as they went.</p>
+
+<p><span class='pagenum'><a name="Page_141" id="Page_141">[Pg 141]</a></span></p><p>The business men of the United States had no choice. They could not
+pause when they had spanned the continent. Ambition called them, surplus
+compelled them, profits lured them, the will to power dominated their
+lives. As well expect the Old Guard to pause in the middle of a
+charge&mdash;even before the sunken road at Waterloo&mdash;as to expect the
+business interests of the United States to cease their efforts and lay
+down their tools of conquest simply because they had reached the ocean
+in one direction. While there were left other directions in which there
+was no ocean; while other undeveloped regions offered the possibility of
+development, an inexorable fate&mdash;the fate inherent in the economic and
+the human stuff with which they were working compelled them to cry
+"Onward!" and to turn to the tasks that lay ahead.</p>
+
+<p>The fathers and grandfathers of these Twentieth Century American
+Plutocrats, working coatless in their tiny factories; managing their
+corner stores; serving their local banks, and holding their minor
+offices had never dreamed of the destiny that lay ahead. No matter. The
+necessity for expansion had come and with it came the opportunity. The
+economic pressure complemented the human desire for "more." The
+structure of business organization, which was erected to conquer one
+continent could not cease functioning when that one continent was
+subdued. Rather, high geared and speeded up as it was, it was in fine
+form to extend its conquests, like the well groomed army that has come
+scatheless through a great campaign, and that longs, throughout its
+tensely unified structure to be off on the next mission.</p>
+
+<p>The business life of the United States came to the Pacific; touched the
+Canadian border; surged against the Rio Grande. The continent had been
+spanned; the objective had been attained. Still, the cry was "Onward!"</p>
+
+<p>Onward? Whither?</p>
+
+<p>Onward to the lands where resources are abundant and rich; onward where
+labor is plentiful, docile and cheap; <span class='pagenum'><a name="Page_142" id="Page_142">[Pg 142]</a></span>onward where the opportunities
+for huge profits are met with on every hand; onward into the undeveloped
+countries of the world.</p>
+
+<p>The capitalists of the European nations, faced by a similar necessity
+for expansion, had been compelled to go half round the earth to India,
+to South Africa, to the East Indies, to China, to Canada, to South
+America. Close at home there was no country except Russia that offered
+great possibilities of development.</p>
+
+<p>The business interests of the United States were more fortunate. At
+their very doors lay the opportunities&mdash;in Canada, in Mexico, in the
+West Indies, in Central and South America. Here were countries with the
+amplest, richest resources; countries open for capitalist development.
+To be sure these investment fields had been invaded already by foreign
+capitalists&mdash;British, German, Belgian and Spanish. But at the same time
+they were surrounded by a tradition of great virility and power&mdash;the
+tradition of "America for the Americans."</p>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_143" id="Page_143">[Pg 143]</a></span></p>
+
+<h2><a name="XI_THE_GREAT_WAR" id="XI_THE_GREAT_WAR"></a>XI. THE GREAT WAR</h2>
+
+<h3>1. <i>Daylight</i></h3>
+
+<p>The work of industrial empire building had continued for less than half
+a century when the United States entered the Great War, which was one in
+a sequence of events that bound America to the wheel of destiny as it
+bound England and France and Germany and Japan and every other country
+that had adopted the capitalist method of production.</p>
+
+<p>The war-test revealed the United States to the world and to its own
+people as a great nation playing a mighty r&ocirc;le in international affairs.
+Most Europeans had not suspected the extent of its power. Even the
+Americans did not realize it. Nevertheless, the processes of economic
+empire building had laid a foundation upon which the superstructure of
+political empire is reared as a matter of course. Henceforth, no one
+need ask whether the United States should or should not be an imperial
+nation. There remained only the task of determining what form American
+imperialism should take.</p>
+
+<p>The Great War rounded out the imperial beginnings of the United States.
+It strengthened the plutocracy at home; it gave the United States
+immense prestige abroad.</p>
+
+<p>The Era of Imperialism dawned upon the United States in 1898. Daylight
+broke in 1914, and the night of isolation and of international
+unimportance gave place to a new day of imperial power.</p>
+
+<h3>2. <i>Plutocracy in the Saddle</i></h3>
+
+<p>The rapid sweep across a new continent had placed the resources of the
+United States in the hands of a powerful minority. Nature had been
+generous and private ownership of the inexhaustible wilderness seemed to
+be the natural&mdash;the obvious method of procedure.</p>
+
+<p><span class='pagenum'><a name="Page_144" id="Page_144">[Pg 144]</a></span></p><p>The lightning march of the American people across the continent gave
+the plutocracy its grip on the natural resources. The revolutionary
+transformations in industry guaranteed its control of the productive
+machinery.</p>
+
+<p>The wizards of industrial activity have changed the structure of
+business life even more rapidly than they have conquered the wilderness.
+True sons of their revolutionary ancestors, they have slashed and
+remodeled and built anew with little regard for the past.</p>
+
+<p>Revolutions are the stalking grounds of predatory power. Napoleon built
+his empire on the French Revolution; Cromwell on the revolt against
+tyrannical royalty in England. Peaceful times give less opportunity to
+personal ambition. Institutions are well-rooted, customs and habits are
+firmly placed, life is regulated and held to earth by a fixed framework
+of habit and tradition.</p>
+
+<p>Revolution comes&mdash;fiercely, impetuously&mdash;uprooting institutions,
+overthrowing traditions, tearing customs from their resting places. All
+is uncertainty&mdash;chaos, when, lo! a man on horseback gathers the loose
+strands together saying, "Good people, I know, follow me!"</p>
+
+<p>He does know; but woe to the people who follow him! Yet, what shall they
+do? Whither shall they turn? How shall they act? Who can be relied upon
+in this uncertain hour?</p>
+
+<p>The man on horseback rises in his stirrups&mdash;speaking in mighty accents
+his message of hope and cheer, reassuring, promising, encouraging,
+inspiring all who come within the sound of his voice. His is the one
+assurance in a wilderness of uncertainty. What wonder that the people
+follow where he leads and beckons!</p>
+
+<p>The revolutionary changes in American economic life between the Civil
+War and the War of 1914 gave the plutocrat his chance. He was the man on
+horseback, quick, clever, shrewd, farseeing, persuasive, powerful.
+Through the courses of these revolutionary changes, the Hills, Goulds,
+Harrimans, Wideners, Weyerhausers, <span class='pagenum'><a name="Page_145" id="Page_145">[Pg 145]</a></span>Guggenheims, Rockefellers,
+Carnegies, and Morgans did to the American economic organization exactly
+what Napoleon did to the French political organization&mdash;they took
+possession of it.</p>
+
+<h3>3. <i>Making the Plutocracy Be Good</i></h3>
+
+<p>The American people were still thinking the thoughts of a competitive
+economic life when the cohorts of an organized plutocracy bore down upon
+them. High prices, trusts, millionaires, huge profits, corruption,
+betrayal of public office took the people by surprise, confused them,
+baffled them, enraged them. Their first thought was of politics, and
+during the years immediately preceding the war they were busy with the
+problem of legislating goodness into the plutocracy.</p>
+
+<p>The plutocrats were in public disfavor, and their control of natural
+resources, banks, railroads, mines, factories, political parties, public
+offices, governmental machinery, the school system, the press, the
+pulpit, the movie business,&mdash;all of this power amounted to nothing
+unless it was backed by public opinion.</p>
+
+<p>How could the plutocracy&mdash;the discredited, vilified plutocracy&mdash;get
+public opinion? How could the exploiters gain the confidence of the
+American people? There was only one way&mdash;they must line up with some
+cause that would command public attention and compel public support. The
+cause that it chose was the "defense of the United States."</p>
+
+<h3>4. <i>"Preparedness"</i></h3>
+
+<p>The plutocracy, with a united front, "went in" for the "defense of the
+United States,"&mdash;attacking the people on the side of their greatest
+weakness; playing upon their primitive emotions of fear and hate. The
+campaign was intense and dramatic, featuring Japanese invasions, Mexican
+inroads, and a world conquest by Germany.</p>
+
+<p><span class='pagenum'><a name="Page_146" id="Page_146">[Pg 146]</a></span></p><p>The preparedness campaign was a marvel of efficient business
+organization. Its promoters made use of every device known to the
+advertising profession; the best brains were employed, and the country
+was blanketed with preparedness propaganda.</p>
+
+<p>Officers of the Army and Navy were frank in insisting that the defense
+of the United States was adequately provided for. (See testimony of
+General Nelson A. Miles. <i>Congressional Record</i>, February 3, 1916, p.
+2265.) Still the preparedness campaign continued with vigor. Congressman
+Clyde H. Tavenner in his speech, "The Navy League Unmasked," showed why.
+He gave facts like those appearing in George R. Kirkpatrick's book,
+"War, What For"; in F. C. Howe's "Why War," and in J. A. Hobson's
+"Imperialism," showing that, in the words of an English authority,
+"patriotism at from 10 to 15 per cent is a temptation for the best of
+citizens."</p>
+
+<p>Tavenner established the connection between the preparedness campaign
+and those who were making profits out of the powder business, the nickel
+business, the copper business, and the steel business, interlocked
+through interlocking directorates; then he established the connection
+between the Navy League and the firm of J. P. Morgan &amp; Co., 23 Wall St.,
+New York. Regarding this connection, Congressman Tavenner said, "The
+Navy League upon close examination would appear to be little more than a
+branch office of the house of J. P. Morgan &amp; Co., and a general sales
+promotion bureau for the various armor and munition makers and the
+steel, nickel, copper and zinc interests."<a name="FNanchor_45_45" id="FNanchor_45_45"></a><a href="#Footnote_45_45" class="fnanchor">[45]</a></p>
+
+<p>The preparedness movement came from the business interests. It was
+fostered and financed by the plutocrats. It was their first successful
+effort at winning public confidence, and so well was it managed that
+millions of Americans fell into line, fired by the love of the flag and
+the world-old devotion to family and fireside.</p>
+
+<p><span class='pagenum'><a name="Page_147" id="Page_147">[Pg 147]</a></span></p>
+
+<h3>5. <i>Patriots</i></h3>
+
+<p>From preparedness to patriotism was an easy step. The preparedness
+advocates had evoked the spirit of the founders of American democracy
+and worked upon the emotions of the people until it was generally
+understood that those who favored preparedness were patriots.</p>
+
+<p>Plutocratic patriotism was accepted by the press, the pulpit, the
+college, and every other important channel of public information in the
+United States. Editors, ministers, professors and lawyers proclaimed it
+as though it were their own. Randolph Bourne, in a brilliant article
+(<i>Seven Arts</i>, July, 1917) reminds his readers of "the virtuous horror
+and stupefaction when they read the manifesto of their ninety-three
+German colleagues in defense of the war. To the American academic mind
+of 1914 defense of war was inconceivable. From Bernhardi it recoiled as
+from a blasphemy, little dreaming that two years later would find it
+creating its own cleanly reasons for imposing military service on the
+country and for talking of the rough rude currents of health and
+regeneration that war would send through the American body politic. They
+would have thought any one mad who talked of shipping American men by
+the hundreds of thousands&mdash;conscripts&mdash;to die on the fields of
+France...."</p>
+
+<p>The American plutocracy was magnified, deified, and consecrated to the
+task of making the world safe for democracy. Exploiters had turned
+saviors and were conducting a campaign to raise $100,000,000 for the Red
+Cross.<a name="FNanchor_46_46" id="FNanchor_46_46"></a><a href="#Footnote_46_46" class="fnanchor">[46]</a> The "malefactors of great wealth," the predatory business
+forces, the special privileged few who had exploited the American people
+for generations, became the prophets and the crusaders,<span class='pagenum'><a name="Page_148" id="Page_148">[Pg 148]</a></span> the keepers of
+the ark of the covenant of American democracy.</p>
+
+<p>Radicals who had always opposed war, ministers who had spent their lives
+preaching peace upon earth, scientists whose work had brought them into
+contact with the peoples of the whole world, public men who believed
+that the United States could do greater and better work for democracy by
+staying out of the war, were branded as traitors and were persecuted as
+zealously as though they had sided with Protestantism in Catholic Spain
+under the Inquisition.</p>
+
+<p>By a clever move, the plutocrats, wrapped in the flag and proclaiming a
+crusade to inaugurate democracy in Germany, rallied to their support the
+professional classes of the United States and millions of the common
+people.</p>
+
+<h3>6. <i>Business in Control</i></h3>
+
+<p>After the declaration of war, the mobilization and direction of the
+economic war work of the government was placed in the hands of the
+Council of National Defense, an organized group of the leading business
+men. The Council consisted of six members of the President's Cabinet,
+assisted by an Advisory Commission and numerous sub-committees. The
+"Advisory Commission" of the Council (the real working body) contained
+four business men, an educator, a labor leader and a medical man. ("The
+Council of National Defense" a bulletin issued by the Council under date
+of June 28, 1917.)</p>
+
+<p>Each member of the Advisory Commission had a group of persons
+co&ouml;perating with him. The make-up of these various committees was
+significant. Among 706 persons listed in the original schedule of
+sub-committees, 404 were business men, 200 were professional men, 59
+were labor men, 23 were public officials and 20 were miscellaneous. It
+was only in Mr. Gompers' group that labor had any representation, and
+even there, out of 138 persons only 59 were workers or officials of
+unions, while 34 were business<span class='pagenum'><a name="Page_149" id="Page_149">[Pg 149]</a></span> men and 33 professional men, so that
+among Mr. Gompers' assistants the business and professional men combined
+considerably outnumbered the labor men.</p>
+
+<p>The make-up of some of the sub-committees revealed the forces behind the
+Defense Council. Thus Mr. Willard's sub-committee on "Express" consisted
+of four vice-presidents, one from the American, one from the
+Wells-Fargo, one from the Southern and one from the Adams Express
+Company. His committee on "Locomotives" consisted of the Vice-President
+of the Porter Locomotive Company, the President of the American
+Locomotive Company, and the Chairman of the Lima Locomotive Corporation.
+Mr. Rosenwald's committee on "Shoe and Leather Industries" consisted of
+eight persons, all of them representing shoe or leather companies. His
+committee on "Woolen Manufactures" consisted of eight representatives of
+the woolen industry. The same business supremacy appeared in Mr.
+Baruch's committees. His committee on "Cement" consisted of the
+presidents of four of the leading cement companies, the vice-president
+of a fifth cement company, and a representative of the Bureau of
+Standards of Washington. His committee on "Copper" had the names of the
+presidents of the Anaconda Copper Company, the Calumet &amp; Hecla Mining
+Company, the United Verde Copper Company and the Utah Copper Company.
+His committee on "Steel and Steel Products" consisted of Elbert H. Gary,
+Chairman of the United States Steel Corporation; Charles M. Schwab, of
+the Bethlehem Steel Company; A. C. Dinkey, Vice-President of the Midvale
+Steel Company; W. L. King, Vice-President of Jones &amp; Loughlin Steel
+Company, and J. A. Burden, President of the Burden Steel Company. The
+four other members of the committee represented the Republic Iron and
+Steel Company, the Lackawanna Steel Company, the American Iron and Steel
+Institute and the Picklands, Mather Co., of Cleveland. Perhaps the most
+astounding of all the committees was that on "Oil." The chairman was the
+President of the Standard Oil Company, and the secretary of the
+committee gives his address as "26 Broadway," the address of the
+Standard Oil <span class='pagenum'><a name="Page_150" id="Page_150">[Pg 150]</a></span>Company. The other nine members of the committee were oil
+men from various parts of the country. What thinking American would have
+suggested, three years before, that the Standard Oil Company would be
+officially directing a part of the work of the Federal Government?</p>
+
+<p>Comment is superfluous. Every great industrial enterprise of the United
+States had secured representation on the committees of business men that
+were responsible for the direction of the economic side of war making.</p>
+
+<p>Then came the Liberty Loan campaigns and Red Cross drives, the direction
+of which also was given into the hands of experienced business men. In
+each community, the leaders in the business world were the leaders in
+these war-time activities. Since the center of business life was the
+bank, it followed that the directing power in all of the war-time
+campaigns rested with the bankers, and thus the whole nation was
+mobilized under the direction of its financiers.</p>
+
+<p>The results of these experiences were far-reaching. During two
+generations, the people of the United States had been passing anti-trust
+laws and anti-pooling laws, the aim of which was to prevent the business
+men of the country from getting together. The war crisis not only
+brought them together, but when they did assemble, it placed the whole
+political and economic power of the nation in their hands.</p>
+
+<p>The business men learned, by first hand experience, the benefits that
+arise from united effort. They joined forces across the continent, and
+they found that it paid. James S. Alexander, President of the National
+Bank of Commerce (New York), tells the story from the standpoint of a
+banker (<i>Manchester Guardian</i>, January 28, 1920. Signed Article.) In a
+discussion of "the experience in co&ouml;perative action which the war has
+given American banks" he says, "The responsibility of floating the five
+great loans issued by the government, together with the work of
+financing a production of materials speeded up to meet war necessities,
+enforced a unity of action and co&ouml;peration which otherwise could hardly
+have been obtained in many years."</p>
+
+<p><span class='pagenum'><a name="Page_151" id="Page_151">[Pg 151]</a></span></p>
+
+<h3>7. <i>Economic Winnings</i></h3>
+
+<p>The war gains of the plutocracy in the field of public control were
+important, as well as spectacular. Behind them, however, were economic
+gains&mdash;little heralded, but of the most vital consequence to the future
+of plutocratic power.</p>
+
+<p>The war speeded production and added greatly to the national income, to
+investable surplus, to profits and thus to the economic power of the
+plutocrats.</p>
+
+<p>The most tangible measure of the economic advantage gained by the
+plutocracy from the war is contained in a report on "Corporate Earnings
+and Government Revenues" (Senate Document 259. 65th Congress, Second
+Session). This report shows the profits made by the various industries
+during 1917&mdash;the first war year.</p>
+
+<p>The report contains 388 large pages on which are listed the profits
+("percent of net income to capital stock in 1917") made by various
+concerns. A typical food producing industry&mdash;"meat packing"&mdash;lists 122
+firms (p. 95 and 365). Of these firms 31 reported profits for the year
+of less than 25 percent; 45 reported profits of 25 but under 50 percent;
+24 reported profits of 50 but under 100 percent, and 22 reported profits
+of 100 percent or more. In this case, a third of the profits were more
+than 25, but less than 50 percent, and half were 50 percent or over.</p>
+
+<p>Manufacturers of cotton yarns reported profits ranging slightly higher
+than those in the meat packing industry (pp. 167, 168, 379). Among the
+153 firms reporting, 21 reported profits of less than 25 percent; 61
+reported 25 but less than 50 per cent; 55 reported 50 but under 100
+percent, and 16 reported 100 percent or more.</p>
+
+<p>Profits in the garment manufacturing industry were lower than those in
+yarn manufacturing. Among the 299 firms reporting (pp. 171, 380) 74 gave
+their profits as less than 25 percent; 121 gave their profits as 25 but
+under 50<span class='pagenum'><a name="Page_152" id="Page_152">[Pg 152]</a></span> percent; 65 gave profits of 50 but less than 100 percent, and
+39 gave their profits as 100 percent or over.</p>
+
+<p>The profits of 49 Steel plants and Rolling Mills (pp. 100, 365) were
+considerably higher than profits in any of the industries heretofore
+discussed. Four firms reported profits of less than 25 percent; 13
+reported profits of 25 but less than 50 percent; 17 reported profits of
+50 but less than 100 percent, and 15 reported profits of more than 100
+percent. In this instance two-thirds of the firms show profits of 50
+percent or over.</p>
+
+<p>Bituminous Coal producers in the Appalachian field (340 in number, pp.
+130 and 372) report a range of profits far higher than those secured in
+the manufacturing industries. Among these 340 firms, 23 reported profits
+of less than 25 percent; 45 reported profits of 25 but under 50 percent;
+79 reported profits of 50 but under 100 percent; 135 reported profits of
+100 but under 500 percent; 21 reported profits of 500 but under 1,000
+percent, and 14 reported profits of 1,000 percent and over. In the case
+of these coal mine operators only a fourth had profits of under 50
+percent and half had profits of more than 100 percent.</p>
+
+<p>The profits in these five industries&mdash;food, yarn, clothing, steel and
+coal&mdash;are quite typical of the figures for the tens of thousands of
+other firms listed in Senate Document 259. Profits of less than 25
+percent are the exception. Profits of over 100 percent were reported by
+8 percent of the yarn manufacturers, by 13 percent of the garment
+manufacturers, by 18 percent of the meat packers, by 31 percent of the
+steel plants, and by 50 percent of the bituminous coal mines. A
+considerable number of profits ranged above 500 percent, or a gain in
+one year of five times the entire capital stock.</p>
+
+<p>When it is remembered that these figures were supplied by the firms
+involved; that they were submitted to a tremendously overworked
+department, lacking the facilities for effective checking-up; and that
+they were submitted for the purposes of heavy taxation, the showing is
+nothing less than astounding.</p>
+
+<p><span class='pagenum'><a name="Page_153" id="Page_153">[Pg 153]</a></span></p>
+
+<h3>8. <i>Winnings in the Home Field</i></h3>
+
+<p>What has the American plutocracy won at home as a result of the war? In
+two words it has gained social prestige and internal (economic)
+solidarity. Both are vital as the foundation for future assertions of
+power.</p>
+
+<p>The plutocracy has unified its hold upon the country as a result of the
+war. Also, it has won an important battle in its struggle with labor.
+The position held by the American plutocracy at the end of the Great War
+could hardly be stated more adequately than in a recent Confidential
+Information Service furnished by an important agency to American
+business men:</p>
+
+<p class="center">"<span class="smcap">Shall Victors Be Magnanimous</span>?</p>
+
+<p>"There is no doubt about it&mdash;Labor is beaten. Mr. Gompers was at his
+zenith in 1918. Since then he has steadily lost power. He has lost power
+with his own people because he is no longer able to deliver the goods.
+He can no longer deliver the goods for two reasons. For one thing, peace
+urgency has replaced war urgency and we are not willing to bid for peace
+labor as we were willing to bid for war labor. For another thing, the
+employing class is immensely more powerful than it was in 1914.</p>
+
+<p>"We have an organized labor force more numerous than ever before.
+Relatively twice as many workers are organized as in 1916. But this same
+labor force has lost its hold on the public. Furthermore, it is divided
+in its own camp. It fears capital. It also fears its own factions. It
+threatens, but it does not dare.</p>
+
+<p>"We said that the employing class was immensely more powerful than in
+1914. There is more money at its command. Eighteen thousand new
+millionaires are the war's legacy. This money capacity is more
+thoroughly unified than ever. In 1914 we had thirty-thousand banks,
+functioning to a great degree in independence of each other. Then came
+the Federal Reserve Act and gave us the <span class='pagenum'><a name="Page_154" id="Page_154">[Pg 154]</a></span>machinery for consolidation and
+the emergency of five years war furnished the hammer blows to weld the
+structure into one.</p>
+
+<p>"The war taught the employing class the secret and the power of
+widespread propaganda. Imperial Europe had been aware of this power. It
+was new to the United States. Now, when we have anything to sell to the
+American people we know how to sell it. We have learned. We have the
+schools. We have the pulpit. The employing class owns the press. There
+is practically no important paper in the United States but is theirs!"</p>
+
+<h3>9. <i>The Run of the World</i></h3>
+
+<p>The war gains of the American plutocracy at home were immense. Even more
+significant, from an imperial standpoint, were the international
+advantages that came to America with the war. The events of the two
+years between 1916 and 1918 gave the United States the run of the world.</p>
+
+<p>Destiny seemed to be bent upon hurling the American people into a
+position of world authority. First, there was the matter of credit. The
+Allies were reaching the end of their economic rope when the United
+States entered the war. They were not bankrupt, but their credit was
+strained, their industries were disorganized, their sources of income
+were narrowed, and they were looking anxiously for some source from
+which they might draw the immense volume of goods and credit that were
+necessary for the continuance of the struggle.<a name="FNanchor_47_47" id="FNanchor_47_47"></a><a href="#Footnote_47_47" class="fnanchor">[47]</a></p>
+
+<p><span class='pagenum'><a name="Page_155" id="Page_155">[Pg 155]</a></span></p><p>The United States was that source of supply. During the years from 1915
+to 1917, the industries of the United States were shifted gradually from
+a peace basis to a war basis. Quantities of material destined for use in
+the war were shipped to the Allies. The unusual profits made on much of
+this business were not curtailed by heavy war taxation. Thus for more
+than two years the basic industries of the United States reaped a
+harvest in profits which were actually free of taxation, at the same
+time that they placed themselves on a war basis for the supplying of
+Europe's war demand. When the United States did enter the war, she came
+with all of the economic advantages that had arisen from selling war
+material to the belligerents during two and a half years. Throughout
+those years, while the Allies were bleeding and borrowing and paying,
+the American plutocracy was growing rich.</p>
+
+<p>When the United States entered the war, she entered it as an ally of
+powers that were economically winded. She herself was fresh. With the
+greatest estimated wealth of any of the warring countries, she had a
+public national debt of less than one half of one percent of her total
+wealth. She had larger quantities of liquid capital and a vast economic
+surplus. As a consequence, she held the purse strings and was able,
+during the next two years, to lend to the Allied nations nearly ten
+billion dollars without straining her resources to any appreciable
+degree.</p>
+
+<p>The nations of Europe had been so deeply engrossed in war-making that
+they had been unable to provide themselves with the necessary food. All
+of the warring countries, with the exception of Russia, were importers
+of food in normal times. The disturbances incident to the war; the
+insatiable army demands, and the loss of shipping all had their effect
+in bringing the Allied countries to a point of critical food scarcity in
+the Winter of 1916-1917.</p>
+
+<p>The United States was able to meet this food shortage as easily as it
+met the European credit shortage&mdash;and with no greater sacrifice on the
+part of the American people. Then, too, with the exception of small
+amounts of food<span class='pagenum'><a name="Page_156" id="Page_156">[Pg 156]</a></span> donated through relief organizations, the food that
+went to Europe was sold at fancy prices. The United States was therefore
+in a position to lay down the basic law,&mdash;"Submit or starve."</p>
+
+<p>With the purse strings and the larder under American control, the
+temporary supremacy of the United States was assured. She was the one
+important nation (beside Japan) that had lost little and gained much
+during the war. She was the only great nation with a surplus of credit,
+of raw materials and of food.</p>
+
+<p>The prosperity incident to this period is reflected in the record of
+American exports, which rose from an average of about two billions in
+the years immediately preceding the war to more than six billions in
+1917. In the same year the imports were just under three billions,
+leaving a trade balance&mdash;that is, a debt owing by foreign countries to
+the United States&mdash;of more than three billions for that one year.</p>
+
+<h3>10. <i>Victory</i></h3>
+
+<p>The war had been in progress for nearly three years before the United
+States took her stand on the side of the Allies. At that time the flower
+of Europe's manhood had faced, for three winters, a fearful pressure of
+hardship and exposure, while millions among the non-combatants had
+suffered, starved, sickened and died. The nerves of Europe were worn and
+the belly of Europe was empty when the American soldiers entered the
+trenches. They were never compelled to bear the brunt of the conflict.
+They arrived when the Central Empires were sagging. Their mere presence
+was the token of victory.</p>
+
+<p>For the first time in history the Americans were matched against the
+peoples of the old world on the home ground of the old world, and under
+circumstances that were enormously favorable to the Americans. European
+capitalism had weakened itself irreparably. The United States<span class='pagenum'><a name="Page_157" id="Page_157">[Pg 157]</a></span> entered
+the war at a juncture that enabled her to take the palm after she had
+already taken billions of profit without risk or loss. The gain to the
+United States was immense, beyond the possibility of present estimate.
+The rulers of the United States became, for the time being, at least,
+the economic dictators of the world.</p>
+
+<p>The Great War brought noteworthy advantages to the American plutocracy.
+At home its power was clinched. Among the nations, the United States was
+elevated by the war into a position of commanding importance. In a
+superficial sense, at least, the Great War "made" the plutocracy at home
+and "made" the United States among the nations.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_45_45" id="Footnote_45_45"></a><a href="#FNanchor_45_45"><span class="label">[45]</span></a> "The Navy League Unmasked," Speech of December 15, 1915,
+<i>Congressional Record</i>.</p></div>
+
+<div class="footnote"><p><a name="Footnote_46_46" id="Footnote_46_46"></a><a href="#FNanchor_46_46"><span class="label">[46]</span></a> This campaign was conducted by H. P. Davison, one of the
+leading members of the firm of J. P. Morgan and Co. Later a great
+war-fund drive was conducted by John D. Rockefeller, Jr. Cleveland H.
+Dodge of the Phelps-Dodge corporation was treasurer of another fund.</p></div>
+
+<div class="footnote"><p><a name="Footnote_47_47" id="Footnote_47_47"></a><a href="#FNanchor_47_47"><span class="label">[47]</span></a> J. Maynard Keynes notes the "immense anxieties and
+impossible financial requirements" of the period between the Summer of
+1916 and the Spring of 1917. The task would soon have become "entirely
+hopeless" but "from April, 1917" the problems were "of an entirely
+different order." "The Economic Consequences of the Peace." New York,
+Harcourt, Brace &amp; Howe, 1920, p. 273.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_158" id="Page_158">[Pg 158]</a></span></p>
+
+<h2><a name="XII_THE_IMPERIAL_HIGHROAD" id="XII_THE_IMPERIAL_HIGHROAD"></a>XII. THE IMPERIAL HIGHROAD</h2>
+
+<h3>1. <i>A Youthful Traveler</i></h3>
+
+<p>Along the highroad that leads to empire moves the American people, in
+the heyday of its youth, sturdy, vigorous, energy-filled, replete with
+power and promise&mdash;conquerors who have swept aside the Indians, enslaved
+a race of black men, subdued a continent, and begun the extension of
+territorial control beyond their own borders. More than a hundred
+million Americans&mdash;fast losing their standards of individualism&mdash;fast
+slipping under the domination of a new-made ruling class of wealth-lords
+and plutocrats&mdash;journey, not discontentedly, along the imperial
+highroad.</p>
+
+<p>The preliminary work of empire-building has been accomplished&mdash;territory
+has been conquered; peoples have been subjected and a ruling class
+organized. The policy of imperialism has been accepted by the people,
+although they have not thought seriously of its consequences. They have
+set out, in good faith, as they believe, to seek for life, liberty and
+happiness. They do not yet realize that, along the road that they are
+now traveling, the journey will not be ended until they have worn
+themselves threadbare in their efforts to conquer the earth.</p>
+
+<p>The American people,&mdash;lacking in political experience and in world
+wisdom; ignorant of the laws of economic and social change,&mdash;have
+committed themselves, unwittingly, to the world old task of setting up
+authority over those who have no desire to accept it, and of exacting
+tribute from those who do not wish to pay it.</p>
+
+<p>The early stages of the journey led across a continent. The American
+people followed it eagerly. Now that the trail leads to other continents
+they are still willing to go.</p>
+
+<p><span class='pagenum'><a name="Page_159" id="Page_159">[Pg 159]</a></span></p><p>"Manifest destiny" is the cry of the leaders. "We are called," echo the
+followers, and the nation moves onward.</p>
+
+<p>There was some hesitancy among the American people during the Spanish
+War. Even the leaders were not ready then. Now the leaders are
+prepared&mdash;for markets, for trade, for investments. They are indifferent
+to political conquest, but economically they are prepared to go on&mdash;into
+Latin America; into Asia; into Europe. The war taught them the lesson
+and gave them an inkling of their power. So they move along the imperial
+highroad&mdash;followed by a people who have not yet learned to chant the
+songs of victory&mdash;but who are destined, at no very distant date, to
+learn victory's lessons and to pay victory's price. Along the path,&mdash;far
+away in the distance they see the earth like a ball, rolling at their
+feet. It is theirs if they will but reach out their hands to grasp it!</p>
+
+<h3>2. <i>An Imperial People</i></h3>
+
+<p>This is the American people&mdash;locked in the arms of mighty economic and
+social forces; building industrial empires; compelled, by a world war,
+to reach out and save "civilization,"&mdash;capitalist civilization,&mdash;a
+people that, by its very ancestry, seems destined to follow the course
+of empire.</p>
+
+<p>The sons and daughters of the native born American stock are, in the
+main, the descendants of the conquering, imperial races of the modern
+world. During recent times, three great empires&mdash;Spain, France and Great
+Britain&mdash;have dominated western civilization. It was these three empires
+that were responsible for the settlement of America. The past generation
+has seen the German empire rise to a position that has enabled her to
+shake the security of the world. The Germans were among the earliest and
+most numerous settlers of the American colonies. Those who boast
+colonial ancestry boast the ancestry of conquerors. The
+Anglo-Saxon-Teutonic races, the titular masters of the<span class='pagenum'><a name="Page_160" id="Page_160">[Pg 160]</a></span> modern world;
+the races that have spread their power where-ever ships sail or trade
+moves or gain offers, furnished the bulk of the early immigrants to
+America.</p>
+
+<p>The bulk of the early immigration to the United States was from Great
+Britain and Germany. The records of immigration (kept officially since
+1820) show that between that year and 1840 the immigrants from Europe
+numbered 594,504, among them there were 358,994 (over half) from the
+British Isles, and 159,215 from Germany, making a total from the two
+countries of 518,209, or 87 percent of the immigrants arriving in the
+twenty-year period. During the next twenty years (1840-1860) the total
+of immigrants from Europe was 4,050,159, of which the British Isles
+furnished 2,386,846 (over half) and Germany 1,386,293, making, for these
+two countries, 94 percent of the whole immigration. Even during the
+years from 1860 to 1880, 82 percent of those who migrated to the United
+States hailed from Great Britain and Germany. American immigration, from
+1820 to 1880, might, without any violence to facts, be described as
+Anglo-Teutonic, so completely does the British-German immigrant dominate
+this period.</p>
+
+<p>Literally, it is true that the American people have been sired by the
+masters and would-be masters of the modern earth.</p>
+
+<h3>3. <i>A Place in the Sun</i></h3>
+
+<p>The Americans, like many another growing people, have sought a place in
+the sun&mdash;widening their boundaries; grasping at promised riches. Unlike
+other peoples they have accomplished the task without any real
+opposition. Their "promised land" lay all about them, isolated from the
+factional warfare of Europe; virgin; awaiting the master of the Western
+World.</p>
+
+<p>The United States has followed the path of empire with a facility
+unexampled in recent history. When has a people, caught in the net of
+imperialism, encountered less difficulty<span class='pagenum'><a name="Page_161" id="Page_161">[Pg 161]</a></span> in making its imperial dream
+come true? None of the foes that the American people have encountered,
+in two centuries of expansion, have been worthy of the name. The Indians
+were in no position to withstand the onslaught of the Whites. The
+Mexicans were even less competent to defend themselves. The Spanish
+Empire crumpled, under attack, like an autumn leaf under the heel of a
+hunter. Practically for the taking, the American people secured a
+richly-stocked, compact region, with an area of three millions of square
+miles&mdash;the ideal site for the foundation of a modern civilization.</p>
+
+<p>The area of the United States has increased with marvelous rapidity. At
+the outbreak of the Revolution (1776) the Colonies claimed a territory
+of 369,000 square miles. The Northwest Territory (275,000 square miles)
+and the area south of the Ohio River (205,000 square miles) were added
+largely as a result of the negotiations in 1782. The official figures
+for 1800 give the total area of the United States as 892,135 square
+miles. The Louisiana Purchase (1803) added 885,000 square miles at a
+cost of 15 millions of dollars. Florida, 59,600 square miles, was
+purchased from Spain (1819) for 5 millions of dollars; Texas, 389,000
+square miles was annexed in 1845; the Oregon Country, 285,000 square
+miles, was secured by treaty in 1846; New Mexico and California, 529,000
+square miles, were ceded by Spain (1848) and a payment of 15 millions
+was made by the United States; in 1853 the Gadsen Purchase added 30,000
+square miles at a cost of ten millions of dollars. This completed the
+territorial possessions of the United States on the mainland (with the
+exception of Alaska) making a continental area of 3,026,798 square
+miles. Between 1776 and 1853 the area of the United States was increased
+more than eight fold. What other nation has been in a position to
+multiply its home territory by eight in two generations?</p>
+
+<p>These vast additions to the continental possessions of the United States
+were made as the result of a trifling outlay. The most serious losses
+were involved in the Mexican War when the casualties included more than
+13,000 killed and<span class='pagenum'><a name="Page_162" id="Page_162">[Pg 162]</a></span> died of wounds and disease. The net money cost of the
+war did not exceed $100,000,000. In return for this outlay&mdash;including
+the annexation of Texas&mdash;the United States secured 918,000 square miles
+of land.<a name="FNanchor_48_48" id="FNanchor_48_48"></a><a href="#Footnote_48_48" class="fnanchor">[48]</a></p>
+
+<p>There is no way to estimate the loss of life or the money cost of the
+Indian Wars. For the most part, the troops engaged in them suffered no
+more heavily than in ordinary police duty, and the costs were the costs
+of maintaining the regular army. The total money outlay for purchases
+and indemnities was about 45 millions of dollars. Within a century the
+American people gained possession of one of the richest portions of the
+earth's surfaces&mdash;a portion equal in area to more than three times the
+combined acreage of Belgium, France, Germany, Italy, Japan and the
+British Isles<a name="FNanchor_49_49" id="FNanchor_49_49"></a><a href="#Footnote_49_49" class="fnanchor">[49]</a>&mdash;in return for an outlay in money and life that would
+not have provided for one first class battle of the Great War.</p>
+
+<p>Additions to the territory of the country were made with equal facility
+during the period following the Civil War. Alaska was purchased from
+Russia for $7,200,000; from Spain, as a result of the War of 1898, the
+United States received the Philippines, Porto Rico, and some lesser
+islands, at the same time paying Spain $20,000,000; Hawaii was annexed
+and an indemnity of $10,000,000 was paid to Panama for the Canal strip.
+During the second half of the nineteenth century, 716,666 square miles
+were added to the possessions of the United States. The total direct
+cost of this territory in money was under forty millions. These gains
+involved no casualties with the exception of the small numbers lost
+during the Spanish-American and Philippine Wars.</p>
+
+<p>One hundred and thirty years have witnessed an addition to the United
+States of more than two and a half million square miles of contiguous,
+continental territory, and<span class='pagenum'><a name="Page_163" id="Page_163">[Pg 163]</a></span> three-quarters of a million square miles of
+non-contiguous territory. The area of the United States in 1900 was four
+times as great as it was in 1800 and more than ten times as great as the
+area of the Thirteen Original Colonies. For the imperialist, the last
+century and a half of American history is a fairyland come true.</p>
+
+<p>Other empires have been won by the hardest kind of fighting, during
+which blood and wealth have been spent with a lavish hand. The empire of
+the French, finally crushed with the defeat of Napoleon, was paid for at
+such a huge price. The British Empire has been established in savage
+competition with Holland, Spain, France, Russia, the United States,
+Germany and a host of lesser powers. The empires of old&mdash;Assyria, Egypt,
+Rome&mdash;were built at an intolerable sacrifice. So terrible has been the
+cost of empire building to some of these nations that by the time they
+had succeeded in creating an empire the life blood of the people and the
+resources of the country were devoured and the empire emerged, only to
+fall an easy prey to the first strong-handed enemy that it encountered.</p>
+
+<p>No such fate has overtaken the United States. On the contrary her path
+has been smoothed before her feet. Inhabiting a garden spot, her immense
+territory gains in the past hundred and fifty years have been made with
+less effort than it has cost Japan to gain and hold Korea or England to
+maintain her dominion over Ireland.</p>
+
+<p>Once established, the old-world empire was not secure. If the territory
+that it possessed was worth having, it was surrounded by hungry-eyed
+nations that took the first occasion to band together and despoil the
+spoiler. The holding of an empire was as great a task as the building of
+empire&mdash;often greater because of the larger outlay in men and money that
+was involved in an incessant warfare. Little by little the glory faded;
+step by step militarism made its inroads upon the normal life of the
+people, until the time came for the stronger rival to overthrow the
+mighty one, or until the inrushing hordes of barbarians should blot<span class='pagenum'><a name="Page_164" id="Page_164">[Pg 164]</a></span> out
+the features of civilization, and enthrone chaos once more.</p>
+
+<p>How different has been the fate of the people of the United States!
+Possessed of what is probably the richest, for the purposes of the
+present civilization, of any territory of equal size in the world, their
+isolation has allowed them more than a century of practical freedom from
+outside interference&mdash;a century that they have been able to devote to
+internal development. The absence of greedy neighbors has reduced the
+expense of military preparation to a minimum; the old world has failed
+to realize, until within the last few years, what were the possibilities
+of the new country; vitality has remained unimpaired, wealth has piled
+up, industry has been promoted, and on each occasion when a greater
+extent of territory was required, it has been obtained at a cost that,
+compared with the experience of other nations, must be described as
+negligible.</p>
+
+<p>So simple has been the process of empire building for the United States;
+so natural have been the stages by which the American Empire has been
+evolved; so little have the changes disturbed the routine of normal life
+that the American people are, for the most part, unaware of the imperial
+position of their country. They still feel, think and talk as if the
+United States were a tiny corner, fenced off from the rest of the world
+to which it owed nothing and from which it expected nothing.</p>
+
+<p>The American Empire has been built, as were the palaces of Aladdin, in a
+night. The morning is dawning, and the early risers who were not even
+awakened from their slumbers by the sound of hammer and engine, are
+beginning to rub their eyes, and to ask one another what is the meaning
+of this apparition, and whether it is real.</p>
+
+<h3>4. <i>The Will to Power</i></h3>
+
+<p>The forces of America are the forces of Empire,&mdash;the geography, the
+economic organization, the racial qualities&mdash;all press in the direction
+of imperialism. There is logic<span class='pagenum'><a name="Page_165" id="Page_165">[Pg 165]</a></span> behind the two centuries of conquest in
+which the American people have been engaged; there is logic in the rise
+of the plutocracy. Now it remains for the rulers of America to accept
+the implications of imperialism,&mdash;to thrill with the will to power; to
+recognize and strengthen imperial purpose; to sell imperialism to the
+American people&mdash;in other words to follow the call of manifest destiny
+and conquer the earth.</p>
+
+<p>The will to power is very old and very strong. Economic and social
+necessity on the one hand, and the driving pressure of human ambition
+and the love of domination on the other, have given it a front place in
+human affairs. The empires of the past were driven into being by this
+ardent force. As far back as history bears a record, one nation or tribe
+has made war on its more fortunately situated neighbor; one leader has
+made cause against his fellow ruler. The Egyptians and Carthaginians
+have conquered in Africa; the Persians, Assyrians and Babylonians
+conquered in Asia; the Macedonians, Greeks, Romans, Spanish, Dutch,
+French, and British built their empires on one or more of the five
+continents. Conqueror has succeeded conqueror, empire has followed
+empire. Spoils, domination, world power, have been the objects of their
+campaigns.</p>
+
+<p>Each great nation grew from small beginnings. Each arose from some
+simple form of tribal or clan organization&mdash;more or less democratic in
+its structure; containing within itself a unified life and a simple folk
+philosophy.</p>
+
+<p>From such plain beginnings empires have developed. The peasants, tending
+their fertile gardens along the borders of the Nile; the vine dressers
+of Italy, the husbandmen and craftsmen of France and the yeomen of Merry
+England had no desire to subjugate the world. If tradition speaks truth,
+they were slow to take upon themselves anything more than the defense of
+their own hearthstones. It was not until the traders sailed across the
+seas; not until stories were brought to them of the vast spoil to be
+had, without work, in other lands, that the peasants and craftsmen
+consented to undertake the task of conquest, subjugation and empire
+building.</p>
+
+<p><span class='pagenum'><a name="Page_166" id="Page_166">[Pg 166]</a></span></p><p>The plain people do not feel the will to power. They know only the
+necessities of self-defense. It is in the ambitions of the leisure
+classes that the demands of conquest have their origin. It is among them
+that men dream of world empire.<a name="FNanchor_50_50" id="FNanchor_50_50"></a><a href="#Footnote_50_50" class="fnanchor">[50]</a></p>
+
+<p>The plain people of the United States have no will to power at the
+present time. They are only asking to be let alone, in order that they
+may go their several ways in peace. They are babes in the world of
+international politics. For generations they have been separated by a
+great gulf of indifference from the remainder of the human race, and
+they crave the continuance of this isolation because it gives them a
+chance to engage, unmolested, in the ordinary pursuits of life.</p>
+
+<p>The American people are not imperialists. They are proud of their
+country, jealous of her honor, willing to make sacrifices for their dear
+ones. They are to-day where the plain folk of Egypt, Rome, France and
+England were before the will to power gripped the ruling classes of
+those countries.</p>
+
+<p>Far different is the position of the American plutocracy. As a ruling
+class the plutocracy feels the necessity of preserving and enlarging its
+privileges. Recently called into a position of leadership, untrained and
+in a sense unprepared, it nevertheless understands that its claim to
+consideration depends upon its ability to do what the ruling classes of
+Egypt, Rome, France and England have done&mdash;to build an empire.</p>
+
+<p>Almost unconsciously, out of the necessities of the period, has come the
+structure of the American Empire. In essence it is an empire, although
+the plain people do not know it, and even the members of the plutocracy
+are in many instances unaware of its true character. Yet here, in a land
+dedicated to liberty and settled by men and women who sought to escape
+from the savage struggles of <span class='pagenum'><a name="Page_167" id="Page_167">[Pg 167]</a></span>empire-ridden Europe, the foundations and
+the superstructure of empire appear.</p>
+
+<p>1. The people of the United States have conquered and now hold
+possession of approximately three million square miles of continental
+territory that has been won by armed force from Great Britain, Mexico,
+Spain, and the American Indians. (The entire area of Europe is only
+3,800,000 square miles.)</p>
+
+<p>2. The people of the United States have conquered and now hold under
+their sway subject people who have enjoyed no opportunity for
+self-determination. A whole race&mdash;the African Negroes&mdash;was captured in
+its native land, transported to America and there sold into slavery. The
+inhabitants of the Philippine Islands were conquered by the armed forces
+of the United States and still are subject people.</p>
+
+<p>3. The United States had developed a plutocracy&mdash;a property holding
+class, that is, to all intents and purposes, the imperialist
+class&mdash;controlling and directing public policy.</p>
+
+<p>4. This plutocratic class is exploiting continental United States and
+its dependencies. After years of savage internal strife, it has
+developed a high degree of class consciousness, and led by its bankers,
+it is taking the fat of the land. The plutocrats, who have made the
+country their United States, are at the present moment busy disposing of
+their surplus in foreign countries. As they build their industrial
+empires, they broaden and deepen their power.</p>
+
+<p>Thus is the round of imperialism complete. Here are the conquered
+territory, subject people, an imperial ruling class, and the
+exploitation, by this class, of the lands and peoples that come within
+the scope of their power. These are the attributes of empire&mdash;the
+characteristics that have appeared, in one form or another, through the
+great empires of the past and of the present day. Differing in their
+forms, they remain similar in the principles that they represent. They
+are imperialism.</p>
+
+<p><span class='pagenum'><a name="Page_168" id="Page_168">[Pg 168]</a></span></p>
+
+<h3>5. <i>Imperial Purpose</i></h3>
+
+<p>The building of international industrial empires by the progressive
+business men of the United States lays the foundation for whatever
+political imperialism is necessary to protect markets, trade and
+investment. Gathering floods of economic surplus are the driving forces
+which are guided by ambition and love of gain and power.</p>
+
+<p>The United States emerged from the Great War in a position of
+unquestioned economic supremacy. With vast stores of all the necessary
+resources, amply equipped with capital, the country has entered the
+field as the most dangerous rival that the other capitalist nations must
+face. Possessed of everything, including the means of providing a navy
+of any reasonable size and an army of any necessary number, the United
+States looms as the dominating economic factor in the capitalist world.</p>
+
+<p>Imperial policy is frequently bold, rough and at times frankly brutal
+and unjust. Where subject peoples and weaker neighbors submit to the
+dictates of the ruling power there is no friction. But where the subject
+peoples or smaller states attempt to assert their rights of
+self-determination or of independence, the empire acts as Great Britain
+has acted in Ireland and in India; as Italy and France have acted in
+Africa; as Japan has acted in Korea; as the United States has acted in
+the Philippines, in Hayti, in Nicaragua, and in Mexico.</p>
+
+<p>Plain men do not like these things. Animated by the belief in popular
+rights which is so prevalent among the western peoples, the masses
+resent imperial atrocities. Therefore it becomes necessary to surround
+imperial action with such an atmosphere as will convince the man on the
+street that the acts are necessary or else that they are inevitable.</p>
+
+<p>When the Church and the State stood together the Czar and the Kaiser
+spoke for God as well as for the financial interests. There was thus a
+double sanction&mdash;imperial <span class='pagenum'><a name="Page_169" id="Page_169">[Pg 169]</a></span>necessity coupled with divine authority.
+Those who were not willing to accept the necessity felt enough reverence
+for the authority to bow their heads in submission to whatever policy
+the masters of empire might inaugurate.</p>
+
+<p>The course of empire upon which the United States has embarked involves
+a complete departure from all of the most cherished traditions of the
+American people. Economic, political and social theories must all be
+thrust aside. Liberty, equality and fraternity must all be forgotten and
+in their places must be erected new standards of imperial purpose that
+are acceptable to the economic and political masters of present day
+American life.</p>
+
+<p>The American people have been taught the language of liberty. They
+believe in freedom for self-determination. Their own government was born
+as a protest against imperial tyranny and they glory in its origin and
+speak proudly of its revolutionary background. Americans are still
+individualists. Their lives and thoughts both have been
+provincial&mdash;perhaps somewhat narrow. They profess the doctrine "Live and
+let live" and in a large measure they are willing and anxious to
+practice it.</p>
+
+<p>How is it possible to harmonize the Declaration of Independence with the
+subjugation of peoples and the conquest of territory? If governments
+"derive their just powers from the consent of the governed," and if it
+is the right of a people to alter or to abolish any government which
+does not insure their safety and happiness, then manifestly subjugation
+and conquest are impossible.</p>
+
+<p>The letter and the spirit of the Declaration of Independence contradict
+the letter and spirit of imperial purpose word for word and line for
+line. There can be no harmony between these two theories of social life.</p>
+
+<h3>6. <i>Advertising Imperialism</i></h3>
+
+<p>Since the tradition of the people of the United States and the
+necessities of imperialism are so utterly at variance, it becomes
+necessary to convince the American people that<span class='pagenum'><a name="Page_170" id="Page_170">[Pg 170]</a></span> they should abandon
+their traditions and accept a new order of society, under which the will
+to power shall be substituted for liberty and fraternity. The ruling
+class of imperial Germany did this frankly and in so many words. The
+English speaking world is more adroit.</p>
+
+<p>The first step in the campaign to advertise and justify imperialism is
+the teaching of a blind my-country-right-or-wrong patriotism. In the
+days preceding the war the idea was expressed in the phrase, "Stand
+behind the President." The object of this teaching is to instill in the
+minds of the people, and particularly of the young, the principles of
+"Deutschland &uuml;ber alles," which, in translation, means "America first."
+There are more than twenty million children in the public schools of the
+United States who are receiving daily lessons in this first principle of
+popular support for imperial policy.</p>
+
+<p>Having taken this first step and made the state supreme over the
+individual will and conscience, the imperial class makes its next
+move&mdash;for "national defense." The country is made to appear in constant
+danger from attack. Men are urged to protect their homes and their
+families. They are persuaded that the white dove of peace cannot rest
+securely on anything less than a great navy and army large enough to
+hold off aggressors. The same forces that are most eager to preach
+patriotism are the most anxious about national preparedness.</p>
+
+<p>Meanwhile the plain people are taught to regard themselves and their
+civilization as superior to anything else on earth. Those who have a
+different language or a different color are referred to as "inferior
+peoples." The people of Panama cannot dig a canal, the people of Cuba
+cannot drive out yellow fever, the people of the Philippines cannot run
+a successful educational system, but the people of the United States can
+do all of these things,&mdash;therefore they are justified in interfering in
+the internal affairs of Panama, Cuba and the Philippines. When there is
+a threat of trouble with Mexico, the papers refer to "cleaning up
+Mexico" very much as a mother might refer to cleaning up a dirty child.</p>
+
+<p><span class='pagenum'><a name="Page_171" id="Page_171">[Pg 171]</a></span></p><p>Patriotism, preparedness and a sense of general superiority lead to
+that type of international snobbery that says, "Our flag is on the seven
+seas"; or "The sun never sets on our possessions"; or "Our navy can lick
+anything on earth." The preliminary work of "Education" has now been
+done; the way has been prepared.</p>
+
+<p>One more step must be taken, and the process of imperializing public
+opinion is complete. The people are told that the imperialism to which
+they have been called is the work of "manifest destiny."</p>
+
+<h3>7. <i>Manifest Destiny</i></h3>
+
+<p>The argument of "manifest destiny" is employed by the strong as a
+blanket justification for acts of aggression against the weak. Each time
+that the United States has come face to face with the necessity of
+adding to its territory at the expense of some weak neighbor, the
+advocates of expansion have plied this argument with vigor and with
+uniform success.</p>
+
+<p>The American nation began its work of territorial expansion with the
+purchase of Louisiana. Jefferson, who had been elected on a platform of
+strict construction of the Constitution, hesitated at an act which he
+regarded as "beyond the Constitution." (Jefferson's "Works," Vol. IV, p.
+198.) Quite different was the language of his more imperialistic
+contemporaries. Gouverneur Morris said, "France will not sell this
+territory. If we want it, we must adopt the Spartan policy and obtain it
+by steel, not by gold."<a name="FNanchor_51_51" id="FNanchor_51_51"></a><a href="#Footnote_51_51" class="fnanchor">[51]</a> During February, 1803, the United States
+Senate debated the closing of the Mississippi to American commerce. "To
+the free navigation of the Mississippi we had an undoubted right from
+nature and from the position of the Western country,"<a name="FNanchor_52_52" id="FNanchor_52_52"></a><a href="#Footnote_52_52" class="fnanchor">[52]</a> said Senator
+Ross (Pennsylvania)<span class='pagenum'><a name="Page_172" id="Page_172">[Pg 172]</a></span> on February 14. On February 23rd Senator White
+(Delaware) went a step farther: "You had as well pretend to dam up the
+mouth of the Mississippi, and say to the restless waves, 'Ye shall cease
+here, and never mingle with the ocean,' as to expect they (the settlers)
+will be prevented from descending it."<a name="FNanchor_53_53" id="FNanchor_53_53"></a><a href="#Footnote_53_53" class="fnanchor">[53]</a> On the same day (February
+23rd) Senator Jackson (Georgia) said: "God and nature have destined New
+Orleans and the Floridas to belong to this great and rising Empire."<a name="FNanchor_54_54" id="FNanchor_54_54"></a><a href="#Footnote_54_54" class="fnanchor">[54]</a></p>
+
+<p>God, nature and the requirements of American commerce were the arguments
+used to justify the purchase, or if necessary, the seizure of New
+Orleans. The precedent has been followed and the same arguments
+presented all through the century that followed the momentous decision
+to extend the territory of the United States.</p>
+
+<p>Some reference has been made to the Mexican War and the argument that
+the Southwest was a "natural" part of the territory of the United
+States. The same argument was made in regard to Cuba and by the same
+spokesmen of the slave-power. Stephen A. Douglas (New Orleans, December
+13, 1858) was asked:</p>
+
+<p>"How about Cuba?"</p>
+
+<p>"It is our destiny to have Cuba," he answered, "and you can't prevent it
+if you try."<a name="FNanchor_55_55" id="FNanchor_55_55"></a><a href="#Footnote_55_55" class="fnanchor">[55]</a></p>
+
+<p>On another occasion (New York, December, 1858) Douglas stated the matter
+even more broadly:</p>
+
+<p>"This is a young, vigorous and growing nation and must obey the law of
+increase, must multiply and as fast as we multiply we must expand. You
+can't resist the law if you try. He is foolish who puts himself in the
+way of American destiny."<a name="FNanchor_56_56" id="FNanchor_56_56"></a><a href="#Footnote_56_56" class="fnanchor">[56]</a></p>
+
+<p>President McKinley stated that the Philippines, like Cuba and Porto
+Rico, "were intrusted to our hands by the<span class='pagenum'><a name="Page_173" id="Page_173">[Pg 173]</a></span> Providence of God" (Boston,
+February 16, 1899), and one of his fellow imperialists&mdash;Senator
+Beveridge of Indiana&mdash;carried the argument one step farther (January 9,
+1900) when he said in the Senate (<i>Congressional Record</i>, January 9,
+1900, p. 704): "The Philippines are ours forever.... And just beyond the
+Philippines are China's illimitable markets. We will not retreat from
+either. We will not repudiate our duty to the archipelago. We will not
+abandon our opportunity in the Orient. We will not renounce our part in
+the mission of our race, trustee, under God, of the civilization of the
+world."</p>
+
+<p>Manifest destiny is now urged to justify further acts of aggression by
+the United States against her weaker neighbors. <i>The Chicago Tribune</i>,
+discussing the Panama Canal and its implications, says editorially (May
+5, 1916): "The Panama Canal has gone a long way towards making our shore
+continuous and the intervals must and will be filled up; not necessarily
+by conquest or even formal annexation, but by a decisive control in one
+form or another."</p>
+
+<p>Here the argument of manifest destiny is backed by the argument of
+"military necessity,"&mdash;the argument that led Great Britain to possess
+herself of Gibraltar, Suez and a score of other strategic points all
+round the earth, and to maintain, at a ruinous cost, a huge navy; the
+argument that led Napoleon across Europe in his march of bloody, fatal
+triumph; the argument that led Germany through Belgium in 1914&mdash;one of
+the weakest and yet one of the most seductive and compelling arguments
+that falls from the tongue of man. Because we have a western and an
+eastern front, we must have the Panama Canal. Because we have the Panama
+Canal, we must dominate Central America. The next step is equally plain;
+because we dominate Central America and the Panama Canal, there must be
+a land route straight through to the Canal. In the present state of
+Mexican unrest, that is impossible, and therefore we must dominate
+Mexico.</p>
+
+<p>The argument was stated with persuasive power by ex-Senator Albert J.
+Beveridge (<i>Collier's Weekly</i>, May 19,<span class='pagenum'><a name="Page_174" id="Page_174">[Pg 174]</a></span> 1917). "Thus in halting fashion
+but nevertheless surely, the chain of power and influence is being
+forged about the Gulf. To neglect Mexico is to throw away not only one
+link but a large part of that chain without which the value and
+usefulness of the remainder are greatly diminished if indeed not
+rendered negligible." By a similar train of logic, the entire American
+continent, from Cape Horn to Bering Sea can and will be brought under
+the dominion of the United States.</p>
+
+<p>Some destiny must call, some imperative necessity must beckon, some
+divine authority must be invoked. The campaign for "100 percent
+Americanism," carefully thought out, generously financed and carried to
+every nook and corner of the United States aims to prove this necessity.
+The war waged by the Department of Justice and by other public officers
+against the "Reds" is intended to arouse in the American people a sense
+of the present danger of impending calamity. The divine sanction was
+expressed by President Wilson in his address to the Senate on July 10,
+1919. The President discussed the Peace Treaty in some of its aspects
+and then said, "It is thus that a new responsibility has come to this
+great nation that we honor and that we would all wish to lift to yet
+higher service and achievement. The stage is set, the destiny disclosed.
+It has come about by no plan of our conceiving but by the hand of God
+who has led us into this war. We cannot turn back. We can only go
+forward, with lifted and freshened spirit to follow the vision."</p>
+
+<h3>8. <i>The Open Road</i></h3>
+
+<p>The American people took a long step forward on November 2, 1920. The
+era of modern imperialism, begun in 1896 by the election of McKinley,
+found its expression in the annexation of Hawaii; the conquest of Cuba
+and the Philippines; the seizure of Panama, and a rapid commercial and
+financial expansion into Latin America. In 1912 the Republicans were
+divided. The more conservative elements backed Taft for re&euml;lection. The
+more aggressive group<span class='pagenum'><a name="Page_175" id="Page_175">[Pg 175]</a></span> (notably United States Steel) supported
+Roosevelt. Between them they divided the Republican strength, and while
+they polled a total vote of 7,604,463 as compared with Wilson's
+6,293,910, the Republican split enabled Wilson to secure a plurality of
+2,173,512, although he had less than half of the total vote.</p>
+
+<p>President Wilson entered office with the ideals of "The New Freedom." He
+was out to back the "man on the make," the small tradesman and
+manufacturer; the small farmer; the worker, ambitious to rise into the
+ranks of business or professional life. With the support, primarily, of
+little business, Wilson managed to hold his own for four years, and at
+the 1916 election to poll a plurality, over the Republican Party, of
+more than half a million votes. He won, however, primarily because "he
+kept us out of war." April, 1917, deprived him of that argument. His
+"New Freedom" doctrines, translated into international politics (in the
+Fourteen Points) were roughly handled in Paris. The country rejected his
+leadership in the decisive Congressional elections of 1918, and he and
+his party went out of power in the avalanche of 1920, when Harding
+received a plurality nearly three times as great as the highest one ever
+before given a presidential candidate (Roosevelt, in 1904). Every state
+north of the Mason and Dixon Line went Republican. Tennessee left the
+Solid South and joined the same party. The Democrats carried only eleven
+states&mdash;the traditional Democratic stronghold.</p>
+
+<p>The victory of Harding is a victory for organized, imperial, American
+business. The "man on the make" is brushed aside. In his place stands
+banker, manufacturer and trader, ready to carry American money and
+American products into Latin America and Asia.</p>
+
+<p>Before the United States lies the open road of imperialism. Manifest
+destiny points the way in gestures that cannot be mistaken. Capitalist
+society in the United States has evolved to a place where it must make
+certain pressing demands upon neighboring communities. Surplus is to be
+invested; investments are to be protected, American <span class='pagenum'><a name="Page_176" id="Page_176">[Pg 176]</a></span>authority is to be
+respected. All of these necessities imply the exercise of imperial power
+by the government of the United States.</p>
+
+<p>Capitalism makes these demands upon the rulers of capitalist society.
+There is no gainsaying them. A refusal to comply with them means death.</p>
+
+<p>Therefore the American nation, under the urge of economic necessity;
+guided half-intelligently, half-instinctively by the plutocracy, is
+moving along the imperial highroad, and woe to the man that steps across
+the path that leads to their fulfillment. He who seeks to thwart
+imperial destiny will be branded as traitor to his country and as
+blasphemer against God.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_48_48" id="Footnote_48_48"></a><a href="#FNanchor_48_48"><span class="label">[48]</span></a> "New American History," A. B. Hart. American Book Co.,
+1917, p. 348.</p></div>
+
+<div class="footnote"><p><a name="Footnote_49_49" id="Footnote_49_49"></a><a href="#FNanchor_49_49"><span class="label">[49]</span></a> The total area of these countries, exclusive of their
+colonies, is 807,123 square miles.</p></div>
+
+<div class="footnote"><p><a name="Footnote_50_50" id="Footnote_50_50"></a><a href="#FNanchor_50_50"><span class="label">[50]</span></a> See "Theory of the Leisure Class," Thorstein Veblen. New
+York, Huebsch, 1918, Ch. 10.</p></div>
+
+<div class="footnote"><p><a name="Footnote_51_51" id="Footnote_51_51"></a><a href="#FNanchor_51_51"><span class="label">[51]</span></a> "A History of Missouri," Louis Houck. Chicago, R. R.
+Donnelly &amp; Sons, 1908, vol. II, p. 346.</p></div>
+
+<div class="footnote"><p><a name="Footnote_52_52" id="Footnote_52_52"></a><a href="#FNanchor_52_52"><span class="label">[52]</span></a> "History of Louisiana," Charles Gayarre. New Orleans,
+Hansell &amp; Bros., Ltd., 1903, vol. III, p. 478.</p></div>
+
+<div class="footnote"><p><a name="Footnote_53_53" id="Footnote_53_53"></a><a href="#FNanchor_53_53"><span class="label">[53]</span></a> Ibid., p. 485.</p></div>
+
+<div class="footnote"><p><a name="Footnote_54_54" id="Footnote_54_54"></a><a href="#FNanchor_54_54"><span class="label">[54]</span></a> Ibid., p. 486.</p></div>
+
+<div class="footnote"><p><a name="Footnote_55_55" id="Footnote_55_55"></a><a href="#FNanchor_55_55"><span class="label">[55]</span></a> McMaster's "History of the American People." Vol. VIII, p.
+339.</p></div>
+
+<div class="footnote"><p><a name="Footnote_56_56" id="Footnote_56_56"></a><a href="#FNanchor_56_56"><span class="label">[56]</span></a> Ibid., p. 339.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_177" id="Page_177">[Pg 177]</a></span></p>
+
+<h2><a name="XIII_THE_UNITED_STATES_AS_A_WORLD_COMPETITOR" id="XIII_THE_UNITED_STATES_AS_A_WORLD_COMPETITOR"></a>XIII. THE UNITED STATES AS A WORLD COMPETITOR</h2>
+
+<h3>1. <i>A New World Power</i></h3>
+
+<p>Youngest among the great nations, the United States holds a position of
+immense world power. Measured in years and compared with her sister
+nations in Europe and Asia, she is a babe. Measured in economic strength
+she is a burly giant. Young America is, but mighty with a vast economic
+strength.</p>
+
+<p>An inexorable destiny seems to be forcing the United States into a
+position of international importance. Up to the time of the Spanish War,
+she played only a minor part in the affairs of the world. The Spanish
+War was the turning point&mdash;the United States as a borrowing nation gave
+way then, to the United States as an investing nation. Economic forces
+compelled the masters of economic life to look outside of the country
+for some of their business opportunities.</p>
+
+<p>Since the Civil War the United States has been preparing herself for her
+part in world affairs. During the thirty years that elapsed between 1870
+and 1900 she emerged from a position of comparative economic inferiority
+to take a position of notable economic importance. Between the years
+1870 and 1900 the population of the United States increased 97 per cent.
+During the same period the annual production of wheat increased from 236
+million bushels to 522 million bushels; the annual production of corn
+from 1,094 to 2,105 million bushels; the annual production of cotton
+from 4,352 to 10,102 thousand bales; the annual production of coal from
+29 to 241 million tons; the annual production of petroleum from 221 to
+2,672 million gallons; the annual production of pig iron from 1,665 to
+13,789 thousand tons; the annual production of steel from 68 to<span class='pagenum'><a name="Page_178" id="Page_178">[Pg 178]</a></span> 10,188
+thousand tons; the annual production of copper from 12 to 271 thousand
+tons, and the production of cement (there is no record for 1870) rose
+from two million barrels in 1880 to 17 million barrels in 1900. Thus
+while the production of food more than kept pace with the increase of
+population, the production of those commodities upon which the new
+industry depends&mdash;coal, petroleum, iron, steel, copper and
+cement&mdash;increased many times more rapidly than the population. During
+one brief generation the United States, with almost unbelievable
+rapidity, forged ahead in the essentials for supremacy in the new world
+of industry.</p>
+
+<p>By the time of the Spanish War (1898) American industries had found
+their stride. During the next fourteen years they were overtaking their
+European competitors in seven league boots. Between 1900 and 1914 while
+the population of the United States increased by 30 per cent,&mdash;</p>
+
+<p class="tbrk">&nbsp;</p>
+
+<table summary="production increases">
+  <tr>
+    <td>Wheat production increased</td>
+    <td class="right">70 per cent</td>
+  </tr>
+  <tr>
+    <td>Corn production increased</td>
+    <td class="right">27&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>Cotton production increased</td>
+    <td class="right">58&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>Coal production increased</td>
+    <td class="right">90&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>Petroleum production increased&nbsp; &nbsp;</td>
+    <td class="right">317&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>Pig Iron production increased</td>
+    <td class="right">69&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>Steel production increased</td>
+    <td class="right">131&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>Copper production increased</td>
+    <td class="right">89&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+  <tr>
+    <td>Cement production increased</td>
+    <td class="right">406&nbsp; &nbsp;"&nbsp; &nbsp; &nbsp;"&nbsp; &nbsp;</td>
+  </tr>
+</table>
+
+<p class="tbrk">&nbsp;</p>
+
+<p>The United States was rushing toward a position of economic world power
+before the catastrophe of 1914 hurled her to the front, first as a
+producer (at immense profits) for the Allies, and later as the financier
+of the final stages of the War.</p>
+
+<p>The economic position that is now held by the United States among the
+great competing nations of the world can be in some measure
+suggested&mdash;it cannot be adequately stated&mdash;by a comparison of the
+economic position of the United States and some of the other leading
+world empires.</p>
+
+<p><span class='pagenum'><a name="Page_179" id="Page_179">[Pg 179]</a></span></p><p>Neither the geographical area of the United States nor the numerical
+importance of its people justifies its present world position. The
+country, with 8 per cent of the area and 6 per cent of the population of
+the world, looms large in the world's economic affairs,&mdash;how large will
+appear from an examination of certain features that are considered
+essential to economic success, such as resources, capital, products,
+shipping, and national wealth and income.</p>
+
+<h3>2. <i>The Resources of the United States</i></h3>
+
+<p>The most important resource of any country is the fertile, agricultural
+land. Figures given in the Department of Agriculture Year Book for 1918
+(Table 319) show the amount of productive land,&mdash;including, beside
+cultivated land, natural meadows, pastures, forests, woodlots, etc., of
+the various countries according to pre-war boundary lines. The total of
+such productive land for the 36 leading countries of the world was
+4,591.7 million acres. Russia, including Siberia, had almost a third of
+this total (1,414.7 million acres). The United States came second with
+878.8 million acres, or 19 per cent of the total available productive
+land. Third in the list was Argentine with 537.8 million acres. British
+India came fourth with 465.7 million acres. Then there followed in order
+Austria-Hungary, Germany, France, Australia, Spain and Japan.
+Austria-Hungary, Germany and France combined had almost exactly four
+hundred million acres of productive land or less than half the
+productive area of the United States.</p>
+
+<p>The United States, in the area of productive land, is second only to
+Russia. In the area of land actually under cultivation, however, it
+stands first, with Russia a close second and British India a close
+third,&mdash;the amounts of cultivated land in each of these countries being
+293.8 million acres, 279.6 million acres, and 264.9 million acres
+respectively. These three countries together contain 64 per cent of the
+1,313.8 million acres of cultivated land of the world. The United States
+alone contains 22 per cent of the total cultivated land.</p>
+
+<p><span class='pagenum'><a name="Page_180" id="Page_180">[Pg 180]</a></span></p><p>The total forest acreage available for commercial purposes is greatest
+in Russia (728.4 million acres). The United States stands second with
+400 million acres and Canada third with 341 million acres. The Chief of
+Forest Investigations of the United States Department of Agriculture
+(Letter of Oct. 11, 1919) places the total forest acreage of both Brazil
+and Canada ahead of the United States. In the case of Brazil no figures
+are available showing what portion of the 988 million acres of total
+area is commercially available. Canada with a total forest acreage of
+800 million acres has less timber commercially available than the United
+States with a total forest area of 500 million acres.</p>
+
+<p>The iron ore reserves of the world are estimated at 91,000 million tons
+("Iron Ores," Edwin C. Eckel. McGraw Hill Book Co., 1914, pp. 392-3). Of
+this amount 51,000 millions are placed in Asia and Africa; 12,000
+million tons in Europe, and 14,800 million tons in North America. The
+United States alone is credited with 4,260 million tons or about 5 per
+cent of the world's supply. The United States Geological Survey
+(<i>Bulletin</i> 666v) estimates the supply of the United States at 7,550
+million tons; the supply in Newfoundland, Mexico and Cuba as 7,000
+million tons, and that in South America as 8,000 million tons as against
+12,000 million tons for Europe. This estimate would give the United
+States alone 8 per cent of the iron ore of the world. It would give
+North America 15 per cent and the Western Hemisphere 25 per cent, as
+against 15 per cent for Europe.</p>
+
+<p>Iron ore furnishes the material out of which industrial civilization is
+constructed. Until recently the source of industrial power has been
+coal. Even to-day petroleum and water play a relatively unimportant
+r&ocirc;le. Coal still holds the field.</p>
+
+<p>The United States alone contains 3,838,657 million tons&mdash;more than half
+of the total coal reserves of the world. ("Coal Resources of the World."
+Compiled by the Executive Committee, International Geological Congress,
+1913, Vol. I, p. XVIII ff.) North America is credited with<span class='pagenum'><a name="Page_181" id="Page_181">[Pg 181]</a></span> 5,073,431
+million tons or over two-thirds of the world's total coal reserves
+(7,397,553 millions of tons). The coal reserve of Europe is 784,190
+million tons or about one-fifth of the coal reserves of the United
+States alone.</p>
+
+<p>Figures showing the amount of productive land and of timber may be
+verified. Those dealing with iron ore and coal in the ground are mere
+estimates and should be treated as such. At the same time they give a
+rough idea of the economic situation. Of all the essential
+resources,&mdash;land, timber, iron, copper, coal, petroleum and
+water-power,&mdash;the United States has large supplies. As compared with
+Europe, her supply of most of them is enormous. No other single country
+(the British Empire is not a single country) that is now competing for
+the supremacy of the world can compare with the United States in this
+regard, and if North America be taken as the unit of discussion, its
+preponderance is enormous.</p>
+
+<h3>3. <i>The Capital of the United States</i></h3>
+
+<p>The United States apparently enjoys a large superiority over any single
+country in its reserves of some of the most essential resources. The
+same thing is true of productive machinery.</p>
+
+<p>Figures showing the actual quantities of capital are available in only a
+small number of cases. Estimates of capital value in terms of money are
+useless. It is only the figures which show numbers of machines that
+really give a basis for judging actual differences.</p>
+
+<p>Live stock on farms, the chief form of agricultural capital, is reported
+for the various countries in the Year Book of the United States
+Department of Agriculture. The United States (1916) heads the list with
+61.9 million cattle; 67.8 million hogs; 48.6 million sheep and goats,
+and 25.8 million horses and mules,&mdash;204 million farm animals in all. The
+Russian Empire (including Russia in Asia) is second (1914) with 52.0
+million cattle; 15.0 hogs; 72.0 million sheep<span class='pagenum'><a name="Page_182" id="Page_182">[Pg 182]</a></span> and goats, and 34.9
+horses and mules,&mdash;174 million farm animals in all. British India (1914)
+reports more cattle than any other country (140.5 million); she is also
+second in the number of sheep and goats with 64.7 millions, but she has
+no hogs and 1.9 million horses. Argentina (1914) reports 29.5 million
+cattle; 2.9 million sheep and goats; and 8.9 million horses and mules.
+The number of animals on European farms outside of Russia is
+comparatively small. Germany (1914), United Kingdom (1916),
+Austria-Hungary (1913), and France (1916) reported 61.8 million cattle,
+46.6 million hogs, 60.8 million sheep and goats, and 11.5 million horses
+and mules, making a total of 180.7 million farm animals. These four
+countries with a population of about 206 million persons, had less live
+stock than the United States with its population (1916) of about 100
+millions.</p>
+
+<p>It would be interesting to compare the amount of farm machinery and farm
+equipment of the United States with that of other countries.
+Unfortunately no such figures are available.</p>
+
+<p>The figures showing transportation capital are fairly complete.
+(<i>Statistical Abstr.</i> 1918, pp. 844-5.) The total railroad mileage of
+the world is 729,845. More than one-third of this mileage (266,381
+miles) is in the United States. Russia (1916) comes second with 48,950
+miles; Germany (1914) third, with 38,600 miles and Canada (1916) fourth
+with 37,437 miles.</p>
+
+<p>The world's total mileage of telegraph wire (Ibid.) is 5,816,219, of
+which the United States has more than a fourth (1,627,342 miles). Russia
+(1916) is second with 537,208 miles; Germany (1914) is third with
+475,551 miles; and France fourth with 452,192 miles.</p>
+
+<p>The Bureau of Railway Economics has published a compilation on
+"Comparative Railway Statistics" (<i>Bulletin 100</i>, Washington, 1916) from
+which it appears that the United States is far ahead of any other
+country in its railroad equipment. The total number of locomotives in
+the United States was 64,760; in Germany 29,520; in United<span class='pagenum'><a name="Page_183" id="Page_183">[Pg 183]</a></span> Kingdom
+24,718; in Russia (1910) 19,984; and in France 13,828. No other country
+in the world had as many as ten thousand locomotives. If these figures
+also showed the locomotive tonnage as well as the number, the lead of
+the United States would be even more decided as the European locomotives
+are generally smaller than those used in the United States. This fact is
+clearly brought out by the figures from the same bulletin showing
+freight car tonnage (total carrying capacity of all cars). For the
+United States the tonnage was (1913) 86,978,145. The tonnage of Germany
+was 10.7 millions; of France 5.0 millions; of Austria-Hungary 3.8
+millions. The figures for the United Kingdom were not available.</p>
+
+<p>The United States also takes the lead in postal equipment. (<i>Stat.
+Abstr.</i>, 1918, pp. 844-5.) There are 324,869 post offices in the world;
+54,257 or one-sixth in the United States. The postal routes of the world
+cover 2,513,997 miles, of which 450,954 miles are in the United States.
+The total miles of mail service for the world is 2,061 millions. Of this
+number the United States has 601.3 millions.</p>
+
+<p>The most extreme contrast between transportation capital in the United
+States and foreign countries is furnished by the number of automobiles.
+<i>Facts and Figures</i>, the official organ of the National Automobile
+Chamber of Commerce (April, 1919) estimates the total number of cars in
+use on January 1, 1917 as 4,219,246. Of this number almost six-sevenths
+(3,500,000) were in use in the United States. The total number of cars
+in Europe as estimated by the Fiat Press Bureau, Italy, was 437,558, or
+less than one-seventh of the number in use in the United States.
+Automobile distribution is of peculiar significance because the industry
+has developed almost entirely since the Spanish-American War and
+therefore since the time when the United States first began to develop
+into a world power.</p>
+
+<p>The world's cotton spindleage in 1919 is estimated at 149.4 million
+spindles. (Letter from T. H. Price 10/6/19.) Of this total Great Britain
+has 57.0 millions; the United States 33.7 millions; Germany 11.0
+millions; Russia 8.0 millions, and France and India each 7.0 millions.</p>
+
+<p><span class='pagenum'><a name="Page_184" id="Page_184">[Pg 184]</a></span></p><p>No effort has been made to cite figures showing the estimated value of
+various forms of capital, because of the necessary variations in value
+standards. Enough material showing actual quantities of capital has been
+presented to prove that in agriculture, in transportation, in certain
+lines of manufacturing the United States is either at the head of the
+list, or else stands in second place. In transportation capital
+(particularly automobiles) the lead of the United States is very great.</p>
+
+<p>If figures were available to show the relative amounts of capital used
+in mining, in merchandising, and in financial transactions they would
+probably show an equally great advantage in favor of the United States.
+In this connection it might not be irrelevant to note that in 1915 the
+total stock of gold money in the world was 8,258 millions of dollars.
+More than a quarter (2,299 millions) was in the United States. The total
+stock of silver money was 2,441 millions of dollars of which 756
+millions (nearly a third) was in the United States. (<i>Stat. Abstr.</i>,
+1918, pp. 840-1.)</p>
+
+<h3>4. <i>Products of the United States</i></h3>
+
+<p>Figures showing the amounts of the principal commodities produced in the
+United States are far more complete than those covering the resources
+and capital. They are perhaps the best index of the present economic
+position of the United States in relation to the other countries of the
+world.</p>
+
+<p>The wheat crop of the world in 1916 was 3,701.3 million bushels. Russia,
+including Siberia, was the leading producer with 686.3 million bushels.
+The United States was second with 636.7 million bushels or 17 per cent
+of the world's output. British India, the third wheat producer, had a
+crop in 1916 of 323.0 million bushels. Canada, with 262.8 million
+bushels, was fourth on the list. Thus Canada and the United States
+combined produced almost exactly one-fourth of the world's wheat crop.</p>
+
+<p><span class='pagenum'><a name="Page_185" id="Page_185">[Pg 185]</a></span></p><p>As a producer of corn the United States is without a peer. The world's
+corn crop in 1916 was 3,642.1 million bushels. Two-thirds of this crop
+(2,566.9 million bushels) was produced in the United States.</p>
+
+<p>The position of the United States as a producer of corn is almost
+duplicated in the case of cotton. The <i>Statistical Abstract</i> published
+by the British Government (No. 39, London, 1914, p. 522) gives the
+world's cotton production as 21,659,000 bales (1912). Of this number the
+United States produced 14,313,000&mdash;almost exactly two-thirds. British
+India, which ranks second, reported a production of 3,203,000 bales.
+Egypt was third with 1,471,000 bales.</p>
+
+<p>About one-tenth of the world's output of wool is produced in the United
+States. World production for 1917 is placed at 2,790,000 pounds.
+(<i>Bulletin</i>, National Association of Wool Manufacturers. 1918, p. 162.)
+Australia heads the list with a production of 741.8 million pounds.
+Russia, including Siberia, comes second with 380.0 million pounds. The
+United States is third with 285.6 million pounds and Argentina fourth
+with 258.3 million pounds.</p>
+
+<p>The United States leads the world in timber production. "Last winter we
+estimated that the United States has been cutting about 50 per cent of
+the total world's supply of lumber." (Letter from Chief of Forest
+Investigation. U. S. Forest Service. Oct. 11, 1919.) The same letter
+gives the present annual timber cut. The United States 12.5 billion
+cubic feet; Russia 7.1 billion cubic feet; Canada 3.0 billion cubic
+feet; Austria-Hungary 2.7 billion cubic feet.</p>
+
+<p>A third of the iron ore produced in the world in 1912 came from the
+United States. The world's production in that year was 154.0 million
+tons (<i>British Statistical Abstract</i>, No. 39, p. 492). The United States
+produced 56.1 million tons or 36 per cent of the whole; Germany produced
+32.7 million tons; France 19.2 million tons; the United Kingdom 14.0
+million tons. No other country is reported as producing as much as ten
+million tons.</p>
+
+<p>The position of the United States as a producer of iron and steel was
+greatly enhanced by the war. <span class='pagenum'><a name="Page_186" id="Page_186">[Pg 186]</a></span><i>The Daily Consular and Trade Reports</i>
+(July 9, 1919, p. 155) give a comparison between the world's steel and
+iron output in 1914 and 1918. In 1914 the United States produced 23.3
+million tons of pig iron; Germany produced 14.4 million tons; the United
+Kingdom 8.9 million tons, and France 5.2 million tons. The United States
+was thus producing 45 per cent of the pig iron turned out in these four
+countries. For 1918 the pig iron production of the United States was
+39.1 million tons. That of the other three countries was 22.0 million
+tons. In that year the United States produced 64 per cent of the pig
+iron product of these four countries. An equally great lead is shown in
+the case of steel production. In 1914 the United States produced 23.5
+million tons of steel. Germany, the United Kingdom and France produced
+27.6 million tons. By 1918 the production of the United States had
+nearly doubled (45.1 million tons).</p>
+
+<p>The total pig iron output of the world for 1917 was placed at 66.9
+millions of tons. The world's production of steel in 1916 was placed at
+83 million tons. The United States produced considerably more than half
+of both commodities. ("The Mineral Industry During 1918." New York,
+McGraw Hill Book Co., 1919, pp. 379-80).</p>
+
+<p>The two chief forms of power upon which modern industry depends are
+petroleum and coal. The United States is the largest producer of both of
+these commodities. The world's production of petroleum in 1917 was 506.7
+million barrels (<i>Mineral Resources</i>, 1917, Part II, p. 867). Of this
+amount the United States produced 335.3 million barrels or 66 per cent
+of the total. The second largest producer, Russia, and the third,
+Mexico, are credited with 69 million barrels and 55.3 million barrels respectively.</p>
+
+<p>As a coal producer the United States stands far ahead of all other
+nations. The United States Geological Survey (<i>Special Report</i>, No. 118)
+placed the total coal production of the world in 1913 at 1,478 million
+tons. Of this amount 569.9 million tons (38.5 per cent) were produced in
+the United States. The production for Great Britain was 321.7 million
+tons; for Germany 305.7 million tons; for <span class='pagenum'><a name="Page_187" id="Page_187">[Pg 187]</a></span>Austria-Hungary 60.6 million
+tons. No other country reported a production of as much as fifty million
+tons. In 1915 the United States produced 40.5 per cent of the world's
+coal; in 1917 44.2 per cent; in 1918 46.2 per cent.</p>
+
+<p>Copper has become one of the world's chief metals. Two-thirds of all the
+copper is produced in the United States. Copper production in 1916
+totaled 3,107 million pounds (<i>Mineral Resources in the United States</i>,
+1916, part I, p. 625). The production for the United States was 1,927.9
+million pounds (62 per cent of the whole). The second largest producer,
+Japan, turned out 179.2 million pounds.</p>
+
+<p>The precious metals, gold and silver, are largely produced in the United
+States. The world's gold production for 1917 was 423.6 million dollars
+(<i>Mineral Resources</i>, 1917, p. 613). Africa produced half of this amount
+(214.6 million dollars). The United States was second with a production
+of 83.8 million dollars (20 per cent of the whole). The same publication
+(p. 615) gives the world's silver production in 1917 as 164 million
+ounces. 77.1 million ounces (43 per cent) were produced in the United
+States. The second largest producer was Mexico, 31.2 million ounces; and
+the third Canada, with 22.3 million ounces. These three North American
+countries produced 76 per cent of the world's output of silver.</p>
+
+<p>Judge Gary, speaking at the Annual Meeting of the Iron and Steel
+Institute (1920) put the situation in this summary form:&mdash;</p>
+
+<p>As frequently stated, notwithstanding the United States has only 6% of
+the world's population and 7% of the world's land, yet we produce:</p>
+
+<blockquote><p>20% of the world's supply of gold,<br />
+25% of the world's supply of wheat,<br />
+40% of the world's supply of iron and steel,<br />
+40% of the world's supply of lead,<br />
+40% of the world's supply of silver,<br />
+50% of the world's supply of zinc,<br />
+52% of the world's supply of coal,<br />
+<span class='pagenum'><a name="Page_188" id="Page_188">[Pg 188]</a></span>60% of the world's supply of aluminum,<br />
+60% of the world's supply of copper,<br />
+60% of the world's supply of cotton,<br />
+66% of the world's supply of oil,<br />
+75% of the world's supply of corn,<br />
+85% of the world's supply of automobiles.</p></blockquote>
+
+<p>With the exception of rubber, practically all of the essential raw
+materials and food products upon which modern industrial society depends
+are produced largely in the United States. With less than a sixteenth of
+the world's population, the United States produced from a fifth to
+two-thirds of most of the world's essential products.</p>
+
+<h3>5. <i>Shipping</i></h3>
+
+<p>The rapid increase in the foreign trade of the United States created a
+demand for American shipping facilities. Before the Civil War the United
+States held a place as a maritime nation. Between the Civil War and the
+war with Spain the energies of the American people were devoted to
+internal improvement. With the advent of expansion that followed the
+Spanish-American War, came an insistent demand that the United States
+develop a merchant marine adequate to carry its own foreign trade.</p>
+
+<p>The United States Commissioner of Navigation in his report for 1917 (p.
+78) gives the net gross tonnage of steam and sailing vessels in 1914 as
+45 million tons in all. The tonnage of Great Britain was 19.8 million
+tons; of Germany 4.9 million tons; of the United States 3.5 million
+tons; of Norway 2.4 million tons; of France 2.2 million tons; of Japan
+1.7 million tons, and of Italy 1.6 million tons.</p>
+
+<p>The war brought about great changes in the distribution of the world's
+shipping. Germany was practically eliminated as a shipping nation. The
+necessity of recouping the submarine losses, and of transporting troops
+and supplies led the United States to adopt a ship-building program<span class='pagenum'><a name="Page_189" id="Page_189">[Pg 189]</a></span>
+that made her the second maritime country of the world. Lloyd's Register
+of Shipping gives the steam tonnage of the United Kingdom as 18,111,000
+gross tons in June, 1920. For the same month the tonnage of the United
+States is given as 12,406,000 gross tons. Japan comes next with a
+tonnage of 2,996,000 gross tons. According to the same authority the
+United Kingdom had 41.6 per cent of the world's tonnage in 1914 and 33.6
+per cent in 1920; while the United States had 4.7 per cent of the
+world's tonnage in 1914 and 24 per cent in 1920.</p>
+
+<h3>6. <i>Wealth and Income</i></h3>
+
+<p>The economic advantages of the United States enumerated in this chapter
+inevitably are reflected in the figures of national wealth and national
+income. While these figures are estimates rather than conclusive
+statements they are, nevertheless, indicative of a general situation.</p>
+
+<p>During the war a number of attempts were made to approximate the pre-war
+wealth and income of the leading nations. Perhaps the most ambitious of
+these efforts was contained in a paper on "Wealth and Income of the
+Chief Powers" read before the Royal Statistical Society. (See <i>The
+London Economist</i>, May 24, 1919, pp. 958-9.) This and other estimates
+were compiled by L. R. Gottlieb and printed in the <i>Quarterly Journal of
+Economics</i> for Nov. 1919. Mr. Gottlieb estimates the pre-war national
+wealth of Great Britain, France, Italy, Japan, Russia, Belgium, Germany,
+Austria-Hungary, Turkey and Bulgaria at 366,100 million dollars. At the
+same time the wealth of the United States was estimated at 204,400
+million dollars. Thus the wealth of the United States was equal to about
+36 per cent of the total wealth of the great nations in question.</p>
+
+<p>The same article contains an estimate of pre-war national incomes for
+these great powers. The total is placed at 81,100 million dollars. The
+income for the United States is placed at 35,300 million dollars, or
+more than 43 per cent of the total.</p>
+
+<p><span class='pagenum'><a name="Page_190" id="Page_190">[Pg 190]</a></span></p><p>The war has made important changes in the wealth and income of the
+principal powers. The wealth and income of Europe have been reduced,
+while the wealth and income of the United States have been greatly
+increased. This increase is rendered doubly emphatic by the
+demoralization in foreign exchange which gives the American dollar a
+position of unique authority in the financial world.</p>
+
+<p>The latest wealth estimates (<i>Commerce and Finance</i>, May 26, and July
+28, 1920) in terms of dollars at their purchasing-power value, makes the
+wealth of the whole British Empire 230 billions of dollars; of France,
+100 billions; of Russia, 60 billions; of Italy, 40 billions; of Japan,
+40 billions; of Germany, 20 billions, and of the United States, 500
+billions. These figures are subject to alteration with the alteration of
+the exchange rates, but they indicate the immense advantage that is
+possessed by the business men of the United States over the business men
+of any or of all of the other nations of the world.</p>
+
+<p>Before the war, the British were the chief lenders in the international
+field. In 1913 Great Britain had about 20 billions of dollars of foreign
+investments, as compared with 9 billions for France and about 6 billions
+for Germany. At the end of 1920, the British foreign investments had
+shrunk to a fraction of their former amount, while the United States,
+from the position of a debtor nation, had become the leading investing
+nation of the world, with over 9 billions of dollars loaned to the
+Allied governments; with notice loans estimated at over 10 billions;
+with foreign investments of 8 billions, and goods on consignment to the
+extent of 2 billions.</p>
+
+<p>The United States therefore began the year 1921 with a greater financial
+lead, by several times over, than that which she held before the war,
+when she was credited with a greater wealth and a larger income than
+that of any other nation in the world. The extent of the advantage
+enjoyed by the United States at the end of 1920 cannot be stated with
+any final accuracy, but its proportions are staggering.</p>
+
+<p><span class='pagenum'><a name="Page_191" id="Page_191">[Pg 191]</a></span></p>
+
+<h3>7. <i>The Economic Position of the United States</i></h3>
+
+<p>Economically the United States is a world power. She occupies one of the
+three great geographical areas in the temperate zone. If she were to
+include Canada, Mexico and Central America&mdash;the territory north of the
+Canal Zone&mdash;she would have the greatest unified body of economic
+advantage anywhere in the world.</p>
+
+<p>The United States is rich in practically all of the important industrial
+resources. She has a large, relatively homogeneous population, a great
+part of which is directly descended from the conquering races of the
+world. Almost all of the essential raw materials are produced in the
+United States, and in relatively large quantities. The period since the
+Spanish War has witnessed a rapid increase in wealth production. The war
+of 1914 resulted in an even greater increase in shipping. The investable
+surplus is greater in the United States than in any other nation, and in
+amount as well as in percent the national debt is less than that in any
+other important nation except Japan. Economically the position of the
+United States is unique. The masters of her industries hold a position
+of great advantage in the capitalist world.</p>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_192" id="Page_192">[Pg 192]</a></span></p>
+
+<h2><a name="XIV_THE_PARTITION_OF_THE_EARTH" id="XIV_THE_PARTITION_OF_THE_EARTH"></a>XIV. THE PARTITION OF THE EARTH</h2>
+
+<h3>1. <i>Economic Power and Political Authority</i></h3>
+
+<p>Economically the United States is a world power. Her world position in
+politics follows as a matter of course.</p>
+
+<p>While the American people were busy with internal development, they
+played an unimportant part in world affairs. They were not competing for
+world trade, because they had relatively little to export; they were not
+building a merchant marine because of the smallness of their trading
+activities; they were not engaged in the scramble after undeveloped
+countries because, with an undeveloped country of their own, calling
+continually for enlarged investments, they had little surplus capital to
+employ in foreign enterprises.</p>
+
+<p>This economic isolation of the United States was reflected in an equally
+thoroughgoing political isolation. With the exception of the Monroe
+Doctrine, which in its original form was intended as a measure of
+defense against foreign political and military aggression, the United
+States minded its own affairs, and allowed the remainder of the world to
+go its way. From time to time, as necessity arose, additional territory
+was purchased or taken from neighboring countries&mdash;but all of these
+transactions, up to the annexation of Hawaii (1898) were confined to the
+continent of North America, in which no European nation, with the
+exception of Great Britain, had any imperative territorial interest.</p>
+
+<p>The economic changes which immediately preceded the Spanish War period
+commanded for the United States a place among the nations. The passing
+of economic <span class='pagenum'><a name="Page_193" id="Page_193">[Pg 193]</a></span>aloofness marked the passing of political aloofness, and
+the United States entered upon a new era of international relationships.
+Possessed of abundant natural resources, and having through a long
+period of peace developed a large working capital with which these
+resources might be exploited, the United States, at the beginning of the
+twentieth century, was in a position to export, to trade and to invest
+in foreign enterprises.</p>
+
+<p>The advent of the World War gave the United States a dramatic
+opportunity to take a position which she must have assumed in any case
+in a comparatively short time. It had, however, one signal, diplomatic
+advantage,&mdash;it enabled the capitalist governments of Europe to accept,
+with an excellent grace, the newly acquired economic prominence of the
+United States and to recognize her without question as one of the
+leading political powers. The loan of ten billions to Europe; the
+sending of two million men at double quick time to the battle front; the
+immense increases in the production of raw material that followed the
+declaration of war by the United States; the thoroughness displayed by
+the American people, once they had decided to enter the war, all played
+their part in the winning of the victory. There were feelings, very
+strongly expressed, that the United States should have come in sooner;
+should have sacrificed more and profiteered less. But once in, there
+could be no question either of the spirit of her armies or of the vast
+economic power behind them.</p>
+
+<p>When it came to dividing the spoils of victory, the United States held,
+not only the purse strings, but the largest surpluses of food and raw
+materials as well. Her diplomacy at the Peace Table was weak. Her
+representatives, inexperienced in such matters, were no match for the
+trained diplomats of Europe, but her economic position was unquestioned,
+as was her right to take her place as one of the "big five."</p>
+
+<p><span class='pagenum'><a name="Page_194" id="Page_194">[Pg 194]</a></span></p>
+
+<h3>2. <i>Dividing the Spoils</i></h3>
+
+<p>The Peace Conference, for purposes of treaty making, separated the
+nations of the world into five classes:</p>
+
+<blockquote><p>1. The great capitalist nations.<br />
+2. The lesser capitalist states.<br />
+3. Enemy nations.<br />
+4. Undeveloped territories.<br />
+5. The socialist states.</p></blockquote>
+
+<p>The great capitalist states were five in number&mdash;Great Britain, France,
+Italy, Japan and the United States. These five states dominated the
+armistice commission and the Peace Conference and they were expected to
+dominate the League of Nations. The position of these five powers was
+clearly set forth in the regulations governing procedure at the Peace
+Conference. Rule I reads: "The belligerent powers with general
+interests&mdash;the United States of America, the British Empire, France,
+Italy and Japan&mdash;shall take part in all meetings and commissions." (<i>New
+York Times</i>, January 20, 1919.) Under this rule the Big Five were the
+Peace Conference, and throughout the subsequent negotiations they
+continued to act the part.</p>
+
+<p>The same concentration of authority was read into the revised covenant
+of the League of Nations. Article 4 provides that the Executive Council
+of the League "shall consist of the representatives of the United States
+of America, of the British Empire, of France, of Italy and of Japan,
+together with four other members of the League." The authority of the
+Big Five was to be maintained by giving them five votes out of nine on
+the executive council of the League, no matter how many other nations
+might become members.</p>
+
+<p>It was among the Big Five, furthermore, that the spoils of victory were
+divided. The Big Five enjoyed a full meal; the lesser capitalist states
+had the crumbs.</p>
+
+<p><span class='pagenum'><a name="Page_195" id="Page_195">[Pg 195]</a></span></p><p>The enemy nations were stripped bare. Their colonies were taken, their
+foreign investments were confiscated, their merchant ships were
+appropriated, they were loaded down with enormous indemnities, they were
+dismembered. In short, they were rendered incapable of future economic
+competition. The thoroughgoing way in which this stripping was
+accomplished is discussed in detail by J. M. Keynes in "The Economic
+Consequences of the Peace" (chapters 4 and 5).</p>
+
+<p>The undeveloped territories&mdash;the economic opportunities upon which the
+Big Five were relying for the disposal of their surplus products and
+surplus capital, were carved and handed about as a butcher carves a
+carcass. Shantung, which Germany had taken from China, was turned over
+to Japan under circumstances which made it impossible for China to sign
+the Treaty&mdash;thus leaving her territory open for further aggression. The
+Near East was divided between Great Britain, France and Italy. Mexico
+was not invited to sign the treaty and her name was omitted from the
+list of those eligible to join the League. The German possessions in
+Africa and in the Pacific were distributed in the form of "mandates" to
+the Great Powers. The principle underlying this distribution was that
+all of the unexploited territory should go to the capitalist victors for
+exploitation. The proportions of the division had been established,
+previously, in a series of secret treaties that had been entered into
+during the earlier years of the war.</p>
+
+<p>With the Big Five in control, with the lesser capitalist states
+silenced; with the border states made or in the making; with the enemy
+reduced to economic impotence, and the unexploited portions of the world
+assigned for exploitation, the conference was compelled to face still
+another problem&mdash;the Socialist Republic of Russia.</p>
+
+<p>Russia, Czar ridden and oppressed, had entered the war as an ally of
+France and Great Britain. Russia, unshackled and attempting
+self-government on an economic basis, was an "enemy of civilization."
+The Allies therefore supported counter-revolution, organized and
+<span class='pagenum'><a name="Page_196" id="Page_196">[Pg 196]</a></span>encouraged warfare by the border states, established and maintained a
+blockade, the purpose of which was the starvation of the Russian people
+into submission, and did all that money, munitions, supplies,
+battleships and army divisions could do to destroy the results of the
+Russian Revolution.</p>
+
+<p>The Big Five&mdash;assuming to speak for all of the twenty-three nations that
+had declared war on Germany&mdash;manipulated the geography of Europe,
+reduced their enemies to penury, disposed of millions of square miles of
+territory and tens of millions of human beings as a gardener disposes of
+his produce, and then turned their united strength to the task of
+crushing the only thing approaching self-government that Russia has had
+for centuries.</p>
+
+<p>A more shameless exhibition of imperial lust is not recorded in history.
+Never before were five nations in a position to sit down at one table
+and decide the political fate of the world. The opportunity was unique,
+and yet the statesmen of the world played the old, savage game of
+imperial aggression and domination.</p>
+
+<p>This brutal policy of dealing with the world and its people was accepted
+by the United States. Throughout the Conference her representatives
+occupied a commanding position; at any time they would have been able to
+speak with a voice of almost conclusive authority; they chose,
+nevertheless, to play their part in this imperial spectacle. To be sure
+the Senate refused to ratify the Treaty,&mdash;not because of its imperial
+iniquities, but rather because there was nothing in it for the United
+States.</p>
+
+<h3>3. <i>Italy, France and Japan</i></h3>
+
+<p>The shares of spoil falling to Italy and France as a result of the
+treaty are comparatively small although both countries&mdash;and particularly
+France&mdash;carried a terrific war burden. Japan, the least active of any of
+the leading participants in the war, received territory of vast
+importance to her future development.</p>
+
+<p><span class='pagenum'><a name="Page_197" id="Page_197">[Pg 197]</a></span></p><p>Italy,&mdash;under the secret treaty of London, signed April 26, 1915, by
+the representatives of Russia, France, Great Britain and Italy,&mdash;was to
+receive that part of Austria known as the Trentine, the entire southern
+Tyrol, the city and suburbs of Trieste, the Istrian Islands and the
+province of Dalmatia with various adjacent islands. Furthermore, Article
+IX of the Treaty stipulated that, in the division of Turkey, Italy
+should be entitled to an equal share in the basin of the Mediterranean,
+and specifically to the province of Adalia. Under Article XIII, "In the
+event of the expansion of French and English colonial domains in Africa
+at the expense of Germany, France and Great Britain recognize in
+principle the Italian right to demand for herself certain compensations
+in the sense of expansions of her lands in Erithria, Somaliland, in
+Lybia and colonial districts lying on the boundary, with the colonies of
+France and England." Substantially, this plan was followed in the Peace
+Treaty.</p>
+
+<p>The territorial claims of France were simple. The secret treaties
+include a note from the French Minister of Foreign Affairs to the French
+Ambassador at Petrograd, dated February 1-14, 1917, which stated that
+under the Peace Treaty:</p>
+
+<blockquote><p>"(1) Alsace and Lorraine to be returned to France.</p>
+
+<p>"(2) The boundaries will be extended at least to the limits of the
+former principality of Lorraine, and will be fixed under the
+direction of the French Government. At the same time strategic
+demands must be taken into consideration, so as to include within
+the French territory the whole of the industrial iron basin of
+Lorraine and the whole of the industrial coal-basin of the Saar."</p></blockquote>
+
+<p>The Peace Treaty confirmed these provisions, with the exception of the
+Saar Valley, which is to go to France for 15 years under conditions
+which will ultimately cause its annexation to France if she desires it.
+France also gained some slight territorial concessions in Africa. Her
+real <span class='pagenum'><a name="Page_198" id="Page_198">[Pg 198]</a></span>advantage&mdash;as a result of the peace&mdash;lies in the control of the
+three provinces with their valuable mineral deposits.</p>
+
+<p>The territorial ambitions of Japan were confined to the Far East. The
+former Russian Ambassador to Tokio, under date of February 8, 1917,
+makes the statement that Japan was desirous of securing "the succession
+to all the rights and privileges possessed by Germany in the Shantung
+province and for the acquisition of the islands north of the Equator."
+In a secret treaty with Great Britain, Japan secured a guarantee
+covering such a division of the German holdings in the Pacific.</p>
+
+<p>These concessions are of great importance to Japan. By the terms of the
+Treaty one of her rivals for the trade of the East (Germany) is
+eliminated, and the territory of that rival goes to Japan. With the
+control of Port Arthur and Korea and Shantung, Japan holds the gateway
+to the heart of Northern China. The islands gained by Japan as a result
+of the Treaty give her a barrier extending from the Kurile Islands, near
+Kamchatka, through the Empire of Japan proper, to Formosa. Farther out
+in the Pacific, there are the Ladrones, the Carolines and the Pelew
+Islands, which, in combination, make a series of submarine bases that
+render attack by sea difficult or impossible, and that lie,
+incidentally, between the United States and the Philippine Islands.
+Japan came away from the Peace Conference with the key to the East in
+her pocket.</p>
+
+<h3>4. <i>The Lion's Share</i></h3>
+
+<p>The lion's share of the Peace Conference spoil went to Great Britain. To
+each of the other participants, certain concessions, agreed upon
+beforehand, were made. The remainder of the war-spoil was added to the
+British Empire. This "remainder" comprised at least a million and half
+square miles of territory, and included some of the most important
+resources in the world.</p>
+
+<p>The territorial gains of Great Britain cover four areas&mdash;the Near East,
+the Far East, Africa, and the South Pacific.</p>
+
+<p><span class='pagenum'><a name="Page_199" id="Page_199">[Pg 199]</a></span></p><p>The gains of Great Britain in the Near East include Hedjez and Yemen,
+the control of which gives the British possession of virtually all of
+the territory bordering on the Red Sea. The Persian Gulf is likewise
+placed under British control, through her holding of Mesopotamia and her
+control over Persia and Oman. The eastern end of the Mediterranean is
+held by the British through their control of Palestine.</p>
+
+<p>Thus the gateway to the East,&mdash;both by land and by sea, the eastern
+shores of the Mediterranean, the valleys of the Tigris and the Euphrates
+and the basin of the Red Sea all fall into the hands of the British, who
+now hold the heart of the Near East. The gains of Great Britain in
+Africa include Togoland, German Southwest Africa and German East Africa.
+With these accessions of territory, Great Britain holds a continuous
+stretch of country from the Cape to Cairo. A British subject can
+therefore travel on British soil from Cape Town via the Isthmus of Suez,
+to Siam, covering a distance as the crow flies of something like 10,000 miles.</p>
+
+<p>The British gains in the South Pacific include Kaiser Wilhelm Land and
+the German islands south of the Equator.</p>
+
+<p>What these territorial gains mean in the way of additional resources for
+the industries of the home country, only the future can decide. Certain
+it is, that outside of the Americas, Central Europe, Russia, China and
+Japan, Great Britain succeeded in annexing most of the important
+territory of the world.</p>
+
+<p>The <i>Chicago Tribune</i>, in one of its charmingly frank editorials, thus
+describes the gains to the British Empire as a result of the war. "The
+British mopped up. They opened up their highway from Cairo to the Cape.
+They reached out from India and took the rich lands of the Euphrates.
+They won Mesopotamia and Syria in the war. They won Persia in diplomacy.
+They won the east coast of the Red Sea. They put protecting territory
+about<span class='pagenum'><a name="Page_200" id="Page_200">[Pg 200]</a></span> Egypt and gave India bulwarks. They made the eastern dream of the
+Germans a British reality.</p>
+
+<p>"The British never had their trade routes so guarded as now. They never
+had their supremacy of the sea so firmly established. Their naval
+competitor, Germany, is gone. No navy threatens them. No empire
+approximates their size, power, and influence.</p>
+
+<p>"This is the golden age of the British Empire, its Augustan age. Any
+imperialistic nation would have fought any war at any time to obtain
+such results, and as imperialistic nations count costs, the British
+cost, in spite of its great sums in men and money was small." (January
+4, 1920.)</p>
+
+<h3>5. <i>Half the World&mdash;Without a Struggle</i></h3>
+
+<p>Two significant facts stand out in this record of spoils distribution.
+One is that Great Britain received the lion's share of them in Asia and
+Africa. The other, that there is no mention of the Americas. Outside of
+the Western Hemisphere, Great Britain is mistress. In the Americas, with
+the exception of Canada, the United States is supreme.</p>
+
+<p>There are two reasons for this. One is that Germany's ambitions and
+possessions included Asia and Africa primarily&mdash;and not America. The
+other is that the Peace Conference recognized the right of the United
+States to dominate the Western Hemisphere.</p>
+
+<p>The representatives of the United States declared that their country was
+asking for nothing from the Peace Conference. Nevertheless, the
+insistent clamor from across the water led the American delegation to
+secure the insertion in the revised League Covenant of Article XXI which
+read: "Nothing in this covenant shall be deemed to affect the validity
+of international engagements, such as treaties of arbitration or
+regional understandings like the Monroe Doctrine for securing the
+maintenance of peace." This article coupled with the first portion of
+Article X, "The<span class='pagenum'><a name="Page_201" id="Page_201">[Pg 201]</a></span> members of the League undertake to respect and preserve
+as against external aggression the territorial integrity and existing
+political independence of all members of the League," guarantees to the
+United States complete authority over Latin America, reserving to her
+political suzerainty and economic priority.</p>
+
+<p>The half of the earth reserved to the United States under these
+provisions contains some of the richest mineral deposits, some of the
+largest timber areas, and some of the best agricultural territory in the
+world. Thus at the opening of the new era, the United States, at the
+cost of a comparatively small outlay in men and money, has guaranteed to
+her by all of the leading capitalist powers practically an exclusive
+privilege for the exploitation of the Western Hemisphere.</p>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_202" id="Page_202">[Pg 202]</a></span></p>
+
+<h2><a name="XV_PAN-AMERICANISM" id="XV_PAN-AMERICANISM"></a>XV. PAN-AMERICANISM</h2>
+
+<h3>1. <i>America for the Americans</i></h3>
+
+<p>In the partition of the earth, one-half was left under the control of
+the United States. Among the great nations, parties to the war and the
+peace, the United States alone asked for nothing&mdash;save the acceptance by
+the world of the Monroe Doctrine. The doctrine, as generally understood,
+makes her mistress of the Western Hemisphere.</p>
+
+<p>The Monroe Doctrine originated in the efforts of Latin America to
+establish its independence of imperial Europe, and the counter efforts
+of imperial Europe to fasten its authority on the newly created Latin
+American Republics. President Monroe, aroused by the European crusade
+against popular government, wrote a message to Congress (1823) in which
+he stated the position of the United States as follows:</p>
+
+<p>"The American continents, by the free and independent condition which
+they have assumed and maintained, are henceforth not to be considered as
+subjects for future colonization by any European powers."</p>
+
+<p>Monroe continues by pointing out that the United States must view any
+act which aims to establish European authority in the Americas as
+"dangerous to our peace and safety."</p>
+
+<p>"The United States will keep her hands off Europe; she will expect
+Europe to keep her hands off America," was the essence of the doctrine,
+which has been popularly expressed in the phrase "America for the
+Americans." The Doctrine was thus a statement of international
+aloofness,&mdash;a declaration of American independence of the remainder of
+the world.</p>
+
+<p><span class='pagenum'><a name="Page_203" id="Page_203">[Pg 203]</a></span></p><p>The Monroe Doctrine soon lost its political character. The southern
+statesmen who were then guiding the destinies of the United States were
+looking with longing eyes into Texas, Mexico, Cuba and other potential
+slave-holding territory. Later, the economic necessities of the northern
+capitalists led them in the same direction. Professor Roland G. Usher,
+in his "Pan-Americanism" (New York, The Century Company, 1915, pp.
+391-392) insists that the Monroe Doctrine stands "First, for our
+incontrovertible right of self-defense. In the second place the Monroe
+Doctrine has stood for the equally undoubted right of the United States
+to champion and protect its primary economic interest against Europe or
+America."</p>
+
+<p>Through the course of a century this statement of defensive policy has
+been converted into a doctrine of economic pseudo-sovereignty. It is no
+longer a case of keeping Europe out of Latin America but of getting the
+United States into Latin America.</p>
+
+<p>The United States does not fear political aggression by Europe against
+the Western Hemisphere. On the contrary, the aggression to-day is
+largely economic, and the struggle for the markets and the investment
+opportunities of Latin America is being waged by the capitalists of
+every great industrial nation, including the United States.</p>
+
+<h3>2. <i>Latin America</i></h3>
+
+<p>Four of the Latin American countries, viewed from the standpoint of
+population and of immediately available assets, rank far ahead of the
+remainder of Latin America. Mexico, with a population in 1914-1915 of
+15,502,000, had an annual government revenue of $72,687,000. The
+population of Brazil is 27,474,000. The annual revenue (1919) is
+$183,615,000. Argentine, with a population of 8,284,000, reported annual
+revenues of $159,000,000 (1918); and Chile, with a population of
+3,870,000, had an annual revenue of $77,964,000 (1917). These four
+states rank in political and economic importance close to Canada.</p>
+
+<p><span class='pagenum'><a name="Page_204" id="Page_204">[Pg 204]</a></span></p><p>Great Britain holds a number of strategic positions in the West Indies.
+Other nations have minor possessions in Latin America. None of these
+possessions, however, is of considerable economic or political
+importance. There remain Bolivia, Uruguay, Colombia, Ecuador, Paraguay,
+Peru, Venezuela, and the Central American states. The most populous of
+these countries is Peru (5,800,000 persons). All of the Central American
+states combined have a population of less than 6,000,000. The annual
+revenues of Uruguay (population 1,407,000) are $30,453,000 (1918-19).
+The combined government revenues of all Central America are less than
+twenty-five millions. (<i>Statistical Abstract of the U. S.</i>, 1919, p.
+826ff.)</p>
+
+<p>Compared with the hundred million population of the United States; its
+estimated wealth (1918) of 250 billions; and its federal revenues of a
+billion and a half in 1916, the Latin American republics cut a very
+small figure indeed. The United States, bristling with economic surplus
+and armed with the Monroe Doctrine, as accepted and interpreted in the
+League Covenant, is free to turn her attention to the rich opportunities
+offered by the undeveloped territory stretching from the Rio Grande to
+Cape Horn. What is there to hinder her movements in this direction?
+Nothing but the limitation on her own needs and the adherence to her own
+public policies. This vast area, containing approximately nine million
+square miles (three times the area of continental United States), has a
+population of only a little over seventy millions. The entire government
+revenues of the territory are in the neighborhood of six hundred
+million, but so widely scattered are the people, so sharp are their
+nationalistic differences, and so completely have they failed to build
+up anything like an effective league to protect their common interests,
+that skillful maneuvering on the part of American economic and political
+interests should meet with no effectual or thoroughgoing opposition.</p>
+
+<p>The "hands off America" doctrine which the United States has enunciated,
+and which Europe has accepted,<span class='pagenum'><a name="Page_205" id="Page_205">[Pg 205]</a></span> means first that none of the Latin
+American Republics is permitted to enter into any entangling alliances
+without the approval of the United States. In the second place it means
+that the United States is free to treat all Latin American countries in
+the same way that she has treated Cuba, Hayti and Nicaragua during the
+past twenty years.</p>
+
+<h3>3. <i>Economic "Latin America"</i></h3>
+
+<p>The United States is the chief producer&mdash;in the Western Hemisphere&mdash;of
+the manufactured supplies needed by the relatively undeveloped countries
+of Latin America. At the same time, the undeveloped countries of Latin
+America contain great supplies of ores, minerals, timber and other raw
+materials that are needed by the expanding manufacturing interests of
+the United States. The United States is a country with an investible
+surplus. Latin America offers ample opportunity for the investment of
+that surplus. Surrounding the entire territory is a Chinese wall in the
+form of the Monroe Doctrine&mdash;intangible but none the less effective.</p>
+
+<p>Before the outbreak of the Great War, European capitalists dominated the
+Latin American investment market. The five years of struggle did much to
+eliminate European influence in Latin America.</p>
+
+<p>The situation was reviewed at length in a publication of the United
+States Department of Commerce "Investments in Latin America and the
+British West Indies," by Frederick M. Halsey (Washington Government
+Printing Office, 1918):</p>
+
+<p>"Concerning the undeveloped wealth of various South American countries,"
+writes Mr. Halsey, "it may be said that minerals exist in all the
+Republics, that the forest resources of all (except possibly Uruguay)
+are very extensive, that oil deposits have been found in almost every
+country and are worked commercially in Argentine, Colombia, Chile,
+Ecuador, Peru and Venezuela, and that there<span class='pagenum'><a name="Page_206" id="Page_206">[Pg 206]</a></span> are lands available for the
+raising of live stock and for agricultural purposes" (p. 20).</p>
+
+<p>As to the pre-war investments, Mr. Halsey points out that "Great Britain
+has long been the largest investor in Latin America" (p. 20). The total
+of British investments he places at 5,250 millions of dollars. A third
+of this was invested in Argentine, a fifth in Brazil and nearly a sixth
+in Mexico. French investments are placed at about one and a half
+billions of dollars. The German investments were extensive, particularly
+in financial and trading institutions. United States investments in
+Latin America before the war "were negligible" (p. 19) outside of the
+investments in the mining industry and in the packing business.</p>
+
+<p>Just how much of a shift the war has occasioned in the ownership of
+Latin American railways, public utilities, mines, etc., it is impossible
+to say. Some such change has occurred, however, and it is wholly in the
+interest of the United States.</p>
+
+<p>Generalizations which apply to Latin America have no force in respect to
+Canada. The capitalism of Canada is closely akin to the capitalism of
+the United States.</p>
+
+<p>Canada possesses certain important resources which are highly essential
+to the United States. Chief among them are agricultural land and timber.
+There are two methods by which the industrial interests of the United
+States might normally proceed with relations to the Canadian resources.
+One is to attack the situation politically, the other is to absorb it
+economically. The latter method is being pursued at the present time. To
+be sure there is a large annual emigration from the United States into
+Canada (approximately 50,000 in 1919) but capital is migrating faster
+than human beings.</p>
+
+<p>The Canadian Bureau of Statistics reports (letter of May 20, 1920) on
+"Stocks, Bonds and other Securities held by incorporated and joint stock
+Companies engaged in manufacturing industries in Canada, 1918," as owned
+by 8,130,368<span class='pagenum'><a name="Page_207" id="Page_207">[Pg 207]</a></span> individual holders, distributed geographically as follows:
+Canada, $945,444,000; Great Britain, $153,758,000; United States,
+$555,943,000, and other countries, $17,221,322. Thus one-third of this
+form of Canadian investment is held in the United States.</p>
+
+<h3>4. <i>American Protectorates</i></h3>
+
+<p>The close economic inter-relations that are developing in the Americas,
+naturally have their counter-part in the political field. As the
+business interests reach southward for oil, iron, sugar, and tobacco
+they are accompanied or followed by the protecting arm of the State
+Department in Washington. Few citizens of the United States realize how
+thoroughly the conduct of the government, particularly in the Caribbean,
+reflects the conduct of the bankers and the traders.</p>
+
+<p>Professor Hart in his "New American History" (American Book Co., 1917,
+p. 634) writes, "In addition the United States between 1906 and 1916
+obtained a protectorate over the neighboring Latin American States of
+Cuba, Hayti, Panama, Santo Domingo and Nicaragua. All together these
+five states include 157,000 square miles and 6,000,000 people."
+Professor Hart makes this statement under the general topic, "What
+America Has Done for the World."</p>
+
+<p>The Monroe Doctrine, logically applied to Latin America, can have but
+one possible outcome. Professor Chester Lloyd Jones characterizes that
+outcome in the following words, "Steadily, quietly, almost unconsciously
+the extension of international responsibility southward has become
+practically a fixed policy with the State Department. It is a policy
+which the record of the last sixteen years shows is followed, not
+without protest from influential factions, it is true, but none the less
+followed, by administrations of both parties and decidedly different
+shades within one of the parties.... Protests will continue but the
+logic of events is too strong to be overthrown by traditional <span class='pagenum'><a name="Page_208" id="Page_208">[Pg 208]</a></span>argument
+or prejudice." ("Caribbean Interests." New York, Appleton, 1916, p.
+125.)</p>
+
+<p>Latin America is in the grip of the Monroe Doctrine. Whether the
+individual states wish it or not they are the victims of a principle
+that has already shorn them of political sovereignty by making their
+foreign policy subject to veto by the United States, and that will
+eventually deprive them of control over their own internal affairs by
+placing the management of their economic activities under the direction
+of business interests centering in the United States. The protectorate
+which the United States will ultimately establish over Latin America was
+forecast in the treaty which "liberated" Cuba. The resolution declaring
+war upon Spain was prefaced by a preamble which demanded the
+independence of Cuba. Presumably this independence meant the right of
+self-government. Actually the sovereignty of Cuba is annihilated by the
+treaty of July 1, 1904, which provides:</p>
+
+<p>"Article I. The Government of Cuba shall never enter into any treaty or
+compact with any foreign power or powers which will impair or tend to
+impair the independence of Cuba, nor in any matter authorize or permit
+any foreign power or powers to obtain by colonization or for military or
+naval purposes, or otherwise, lodgement in, or control over any portion
+of said island."</p>
+
+<p>The most drastic limitations upon Cuba's sovereignty are contained in
+Article 3 which reads, "the Government of Cuba consents that the United
+States may exercise the right to intervene for the preservation of Cuban
+independence, the maintenance of a government adequate for the
+protection of life, property and individual liberty, and for discharging
+the obligation with respect to Cuba imposed by the Treaty of Paris on
+the United States now to be assumed and undertaken by the Government of
+Cuba." Under this article, the United States, at her discretion, may
+intervene in Cuba's internal affairs.</p>
+
+<p>Under these treaty provisions the Cuban Government is not only prevented
+from exercising normal governmental<span class='pagenum'><a name="Page_209" id="Page_209">[Pg 209]</a></span> functions in international matters,
+but if a change of internal government should take place which in the
+opinion of the United States jeopardized "life, property and individual
+liberty" such a government could be suppressed by the armed forces of
+the United States and a government established in conformity with her
+wishes. Theoretically, Cuba is an independent nation. Practically, Cuba
+has signed away in her treaty with the United States every important
+attribute of sovereignty.</p>
+
+<p>The fact that Cuba was a war-prize of the United States might be
+advanced as an explanation of her anomalous position, were it not for
+the relations now existing between the Dominican Republic, Hayti and
+Nicaragua on the one hand and the United States on the other. The United
+States has never been at war with any of these countries, yet her
+authority over them is complete.</p>
+
+<p>The Convention between the United States and the Dominican Republic,
+proclaimed July 25, 1907, gave the United States the right to appoint a
+receiver of Dominican customs in order that the financial affairs of the
+Republic might be placed on a sound basis. This appointment was followed
+in 1916 by the landing of the armed forces of the United States in the
+territory of the Dominican Republic. On November 29, 1916, a military
+government was set up by the United States Marine Corps under a
+proclamation approved by the President. "This military government at
+present conducts the administration of the government" (Letter from
+State Department, September 29, 1919).</p>
+
+<p>The proclamation issued by the Commander of the United States Marine
+Corps and approved by the President, cited the failure of the Dominican
+government to live up to its treaty obligations because of internal
+dissensions and stated that the Republic is made subject to military
+government and to the exercise of military law applicable to such
+occupation. Dominican statutes "will continue in effect insofar as they
+do not conflict with the objects of the Occupation or necessary
+relations established thereunder, and their lawful administration will
+continue in the hands of such<span class='pagenum'><a name="Page_210" id="Page_210">[Pg 210]</a></span> duly authorized Dominican officials as
+may be necessary, all under the oversight and control of the United
+States forces exercising Military Government." The proclamation further
+announces that the Military Government will collect the revenues and
+hold them in trust for the Republic.</p>
+
+<p>Following this proclamation Captain H. S. Knapp issued a drastic order
+providing for a press censorship. "Any comment which is intended to be
+published on the attitude of the United States Government, or upon
+anything connected with the Occupation and Military Government of Santo
+Domingo must first be submitted to the local censor for approval. In
+case of any violation of this rule the publication of any newspaper or
+periodical will be suspended; and responsible persons,&mdash;owners, editors,
+or others&mdash;will further be liable to punishment by the Military
+Government. The printing and distribution of posters, handbills, or
+similar means of propaganda in order to disseminate views unfavorable to
+the United States Government or to the Military Government in Santo
+Domingo is forbidden." (Order secured from the Navy Department and
+published by The American Union against Militarism, Dec. 13, 1916.)</p>
+
+<p>A similar situation exists in Hayti. The treaty of May 3, 1916, provides
+that "The Government of the United States will, by its good officers,
+aid the Haitian Government in the proper and efficient development of
+its agricultural, mineral and commercial resources and in the
+establishment of the finances of Hayti on a firm and solid basis."
+(Article I) "The President of Hayti shall appoint upon nomination by the
+President of the United States a general receiver and such aids and
+employees as may be necessary to manage the customs. The President of
+Hayti shall also appoint a nominee of the President of the United States
+as 'financial adviser' who shall 'devise an adequate system of public
+accounting, aid in increasing revenues' and take such other steps 'as
+may be deemed necessary for the welfare and prosperity of Hayti.'"
+(Article II.) Article III guarantees "aid and protection of both
+countries to<span class='pagenum'><a name="Page_211" id="Page_211">[Pg 211]</a></span> the General Receiver and the Financial Adviser." Under
+Article X "The Haitian Government obligates itself ... to create without
+delay an efficient constabulary, urban and rural, composed of native
+Haitians. This constabulary shall be organized and officered by
+Americans." The Haitian Government under Article XI, agrees not to
+"surrender any of the territory of the Republic by sale, lease or
+otherwise, or jurisdiction over such territory, to any foreign
+government or power" nor to enter into any treaty or contract that "will
+impair or tend to impair the independence of Hayti." Finally, to
+complete the subjugation of the Republic, Article XIV provides that
+"should the necessity occur, the United States will lend an efficient
+aid for the preservation of Haitian independence and the maintenance of
+a government adequate for the protection of life, property and
+individual liberty."</p>
+
+<p>A year later, on August 20, 1917, the <i>New York Globe</i> carried the
+following advertisement:&mdash;</p>
+
+<blockquote><h4><span class="smcap">Fortune in Sugar</span></h4>
+
+<p>"The price of labor in practically all the cane sugar growing
+countries has gone steadily up for years, except in Hayti, where
+costs are lowest in the world.</p>
+
+<p>"<i>Hayti now is under U. S. Control.</i></p>
+
+<p>"The Haitian-American corporation owns the best sugar lands in
+Hayti, owns railroads, wharf, light and power-plants, and is
+building sugar mills of the most modern design. There is assured
+income in the public utilities and large profits in the sugar
+business. We recommend the purchase of the stock of this
+corporation. Proceedings are being taken to list this stock on the
+New York Stock Exchange.</p>
+
+<p>"Interesting story 'Sugar in Hayti' mailed on request.</p>
+
+<p>"P. W. Chapman &amp; Co., 53 William St., N. Y. C."</p></blockquote>
+
+<p><span class='pagenum'><a name="Page_212" id="Page_212">[Pg 212]</a></span></p><p>Hayti remained "under United States control" until the revelations of
+the summer of 1920 (see <i>The Nation</i>, July 10 and August 28, 1920), when
+it was shown that the natives were being compelled, by the American
+forces of occupation, to perform enforced labor on the roads and to
+accept a rule so tyrannous that thousands had refused to obey the orders
+of the military authorities, and had been shot for their pains. On
+October 14, 1920, the <i>New York Times</i> printed a statement from
+Brigadier General George Barnett, formerly Commandant General of the
+Marine Corps, covering the conditions in Hayti between the time the
+marines landed (July, 1915) and June, 1920. General Barnett alleges in
+his report that there was evidence of "indiscriminate" killing of the
+natives by the American Marines; that "shocking conditions" had been
+revealed in the trial of two members of the army of occupation, and that
+the enforced labor system should be abolished forthwith. The report
+shows that, during the five years of the occupation, 3,250 Haytians had
+been killed by the Americans. During the same period, the losses to the
+army of occupation were 1 officer and 12 men killed and 2 officers and
+26 men wounded.</p>
+
+<p>The attitude of the United States authorities toward the Haytians is
+well illustrated by the following telegram which the United States
+Acting Secretary of the Navy sent on October 2, 1915, to Admiral
+Caperton, in charge of the forces in Hayti: "Whenever the Haytians wish,
+you may permit the election of a president to take place. The election
+of Dartiguenave is preferred by the United States."</p>
+
+<p>The Cuban Treaty established the precedent; the Great War provided the
+occasion, and while Great Britain was clinching her hold in Persia, and
+Japan was strengthening her grip on Korea, the United States was engaged
+in establishing protectorates over the smaller and weaker Latin-American
+peoples, who have been subjected, one after another, to the omnipotence
+of their "Sister Republic" of the North.</p>
+
+<p><span class='pagenum'><a name="Page_213" id="Page_213">[Pg 213]</a></span></p>
+
+<h3>5. <i>The Appropriation of Territory</i></h3>
+
+<p>Protectorates have been established by the United States, where such
+action seemed necessary, over some of the weaker Latin-American states.
+Their customs have been seized, their governments supplanted by military
+law and the "preservation of law and order" has been delegated to the
+Army and Navy of the United States. The United States has gone farther,
+and in Porto Rico and Panama has appropriated particular pieces of
+territory.</p>
+
+<p>The Porto Ricans, during the Spanish-American War, welcomed the
+Americans as deliverers. The Americans, once in possession, held the
+Island of Porto Rico as securely as Great Britain holds India or Japan
+holds Korea. The Porto Ricans were not consulted. They had no
+opportunity for "self-determination." They were spoils of war and are
+held to-day as a part of the United States.</p>
+
+<p>The Panama episode furnishes an even more striking instance of the
+policy that the United States has adopted toward Latin-American
+properties that seemed particularly necessary to her welfare.</p>
+
+<p>Efforts to build a Panama Canal had covered centuries. When President
+Roosevelt took the matter in hand he found that the Government of
+Colombia was not inclined to grant the United States sovereignty over
+any portion of its territory. The treaty signed in 1846 and ratified in
+1848 placed the good faith of the United States behind the guarantee
+that Colombia should enjoy her sovereign rights over the Isthmus. During
+November 1902 the United States ejected the representatives of Colombia
+from what is now the Panama Canal Zone and recognized a revolutionary
+government which immediately made the concessions necessary to enable
+the United States to begin its work of constructing the canal.</p>
+
+<p>The issue is made clear by a statement of Mr. Roosevelt frequently
+reiterated by him (see <i>The Outlook</i>, October 7, 1911) and appearing in
+the <i>Washington Post</i> of March 24,<span class='pagenum'><a name="Page_214" id="Page_214">[Pg 214]</a></span> 1911, as follows:&mdash;"I am interested
+in the Panama Canal because I started it. If I had followed the
+traditional conservative methods I would have submitted a dignified
+state paper of probably two hundred pages to the Congress and the debate
+would have been going on yet. But I took the Canal Zone and let the
+Congress debate, and while the debate goes on, the Canal does also."</p>
+
+<p>Article 35 of the Treaty of 1846 between the United States and Colombia
+(then New Grenada) reads as follows,&mdash;"The United States guarantees,
+positively and efficaciously to New Grenada, by the present stipulation,
+the perfect neutrality of the before mentioned Isthmus ... and the
+rights of sovereignty which New Grenada has and possesses over said
+territory."</p>
+
+<p>In 1869 another treaty was negotiated between the United States and
+Colombia which provided for the building of a ship canal across the
+Isthmus. This treaty was signed by the presidents of both republics and
+ratified by the Colombian Congress. The United States Senate refused its
+assent to the treaty. Another treaty negotiated early in 1902 was
+ratified by the United States Senate but rejected by the Colombian
+Congress. The Congress of the United States had passed an act (June 28,
+1902) "To provide for the construction of a canal connecting the waters
+of the Atlantic and the Pacific Oceans." Under this act the President
+was authorized to negotiate for the building of the canal across the
+Isthmus of Panama. If that proved impossible within a reasonable time,
+the President was to turn to the Nicaragua route. The treaty prepared in
+accordance with this act provided that the United States would pay
+Colombia ten millions of dollars in exchange for the sovereignty over
+the Canal Zone. The Colombian Congress after a lengthy debate rejected
+the treaty and adjourned on the last day of October, 1902.</p>
+
+<p>Rumor had been general that if the treaty was not ratified by the
+Colombian Government, the State of Panama would secede from Colombia,
+sign the treaty, and thus secure the ten millions. In consequence of
+these rumors, which<span class='pagenum'><a name="Page_215" id="Page_215">[Pg 215]</a></span> threatened transportation across the Isthmus,
+American war vessels were dispatched to Panama and to Colon.</p>
+
+<p>On November 3, 1902, the Republic of Panama was established. On November
+13 it was recognized by the United States. Immediately thereafter a
+treaty was prepared and ratified by both governments and the ten
+millions were paid to the Government of Panama.</p>
+
+<p>Early in the day of November 3, the Department of State was informed
+that an uprising had occurred. Mr. Loomis wired, "Uprising on Isthmus
+reported. Keep Department promptly and fully informed." In reply to this
+the American consul replied, "The uprising has not occurred yet; it is
+announced that it will take place this evening. The situation is
+critical." Later the same official advised the Department that (in the
+words of the Presidential message, 1904) "the uprising had occurred and
+had been successful with no bloodshed."</p>
+
+<p>The Colombian Government had sent troops to put down the insurrection
+but the Commander of the United States forces, acting under instructions
+sent from Washington on November 2, prevented the transportation of the
+troops. His instructions were as follows,&mdash;"Maintain free and
+uninterrupted transit if interruption is threatened by armed force with
+hostile intent, either governmental or insurgent, at any point within
+fifty miles of Panama. Government forces reported approaching the
+Isthmus in vessels. Prevent their landing, if, in your judgment, the
+landing would precipitate a conflict."</p>
+
+<p>Thus a revolution was consummated under the watchful eye of the United
+States forces; the home government at Bogota was prevented from taking
+any steps to secure the return of the seceding state of Panama to her
+lawful sovereignty, and within ten days of the revolution, the new
+Republic was recognized by the United States Government.<a name="FNanchor_57_57" id="FNanchor_57_57"></a><a href="#Footnote_57_57" class="fnanchor">[57]</a><span class='pagenum'><a name="Page_216" id="Page_216">[Pg 216]</a></span> (Ten days
+was the length of time necessary to transmit a letter from Panama to
+Washington. Greater speed would have been impossible unless the new
+state had been recognized by telegraph.)</p>
+
+<h3>6. <i>The Logical Exploiters</i></h3>
+
+<p>The people of the United States are the logical exploiters of the
+Western Hemisphere&mdash;the children of destiny for one half the world. They
+are pressed by economic necessity. They need the oil of Mexico, the
+coffee of Brazil, the beef of Argentine, the iron of Chile, the sugar of
+Cuba, the tobacco of Porto Rico, the hemp of Yucatan, the wheat and
+timber of Canada. In exchange for these commodities the United States is
+prepared to ship manufactured products. Furthermore, the masters of the
+United States have an immense and growing surplus that must be invested
+in some paying field, such as that provided by the mines, agricultural
+projects, timber, oil deposits, railroad and other industrial activities
+of Latin-America.</p>
+
+<p>The rulers of the United States are the victims of an economic necessity
+that compels them to seek and to find raw materials, markets and
+investment opportunities. They are also the possessors of sufficient
+economic, financial, military and naval power to make these needs good
+at their discretion.</p>
+
+<p>The rapidly increasing funds of United States capital invested in
+Latin-America and Canada, will demand more and more protection. There is
+but one way for the United States to afford that protection&mdash;that is to
+see that these countries preserve law and order, respect property, and
+follow the wishes of United States diplomacy. Wherever a government
+fails in this respect, it will be necessary for the State Department in
+co&ouml;peration with the Navy, to see that a government is established that
+will "make good."</p>
+
+<p>Under the Monroe Doctrine, as it has long been interpreted, no
+Latin-American Government will be permitted<span class='pagenum'><a name="Page_217" id="Page_217">[Pg 217]</a></span> to enter into entangling
+alliances with Europe or Asia. Under the Monroe Doctrine, as it is now
+being interpreted, no Latin-American people will be permitted to
+organize a revolutionary government that abolishes the right of private
+interests to own the oil, coal, timber and other resources. The mere
+threat of such action by the Carranza Government was enough to show what
+the policy of the United States must be in such an emergency.</p>
+
+<p>The United States need not dominate politically her weaker sister
+republics. It is not necessary for her to interfere with their
+"independence." So long as their resources may be exploited by American
+capitalists; so long as the investments are reasonably safe; so long as
+markets are open, and so long as the other necessities of United States
+capitalism are fulfilled, the smaller states of the Western Hemisphere
+will be left free to pursue their various ways in prosperity and peace.</p>
+
+<div class="footnotes"><h3>FOOTNOTE:</h3>
+
+<div class="footnote"><p><a name="Footnote_57_57" id="Footnote_57_57"></a><a href="#FNanchor_57_57"><span class="label">[57]</span></a> For further details see "The Panama Canal" Papers
+presented to the Senate by Mr. Lodge, Senate Document 471, 63rd
+Congress, 2nd Session.</p></div></div>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_218" id="Page_218">[Pg 218]</a></span></p>
+
+<h2><a name="XVI_THE_AMERICAN_CAPITALISTS_AND_WORLD_EMPIRE" id="XVI_THE_AMERICAN_CAPITALISTS_AND_WORLD_EMPIRE"></a>XVI. THE AMERICAN CAPITALISTS AND WORLD EMPIRE</h2>
+
+<h3>1. <i>The Plutocrats Must Carry On</i></h3>
+
+<p>The American plutocrats&mdash;those who by force of their wealth share in the
+direction of public policy&mdash;must carry on. They have no choice. If they
+are to continue as plutocrats, they must continue to rule. If they
+continue to rule, they must shoulder the duties of rulership. They may
+not relish the responsibility which their economic position has thrust
+upon them any more than the sojourners in Newfoundland relish the savage
+winters. Nevertheless, those who own the wealth of a capitalist nation
+must accept the results of that ownership just as those who remain in
+Newfoundland must accept the winter storms.</p>
+
+<p>The owners of American timber, mines, factories, railroads, banks and
+newspapers may dislike the connotations of imperialism; may believe
+firmly in the principles of competition and individualism; may yearn for
+the nineteenth century isolation which was so intimate a feature of
+American economic life. But their longings are in vain. The old world
+has passed forever; the sun has risen on a new day&mdash;a day of world
+contacts for the United States.</p>
+
+<p>Henry Cabot Lodge of Massachusetts stated the matter with rare accuracy
+in a speech which he made during the discussion over the conquest of the
+Philippines. After explaining that wars come, "never ostensibly, but
+actually from economic causes," Senator Lodge said (<i>Congressional
+Record</i>, 56th Congress, 2nd Session, p. 637. January 7, 1901):</p>
+
+<p>"We occupy a great position economically. We are marching on to a still
+greater one. You may impede it,<span class='pagenum'><a name="Page_219" id="Page_219">[Pg 219]</a></span> you may check it, but you cannot stop
+the work of economic forces. You cannot stop the advance of the United
+States.... The American people and the economic forces which underlie
+all are carrying us forward to the economic supremacy of the world."</p>
+
+<p>Senator Lodge spoke the economic truth in 1901. William C. Redfield
+re&euml;nforced it in an address before the American Manufacturers Export
+Association (<i>Weekly Bulletin</i>, April 26, 1920, p. 7): "We cannot be
+foreign merchants very much longer in this country excepting on a
+diminishing and diminishing scale&mdash;we have got to become foreign
+constructors; we have got to build with American money&mdash;foreign
+enterprises, railroads, utilities, factories, mills, I know not what, in
+order that by large ownership in them we may command the trade that
+normally flows from their operation." That is sound capitalist doctrine.
+Equally sound is the exhortation that follows: "In so doing we shall be
+doing nothing new&mdash;only new for us. That is the way in which Germany and
+Great Britain have built up their foreign trade."</p>
+
+<p>New it is for America&mdash;but it is the course of empire, familiar to every
+statesman. The lesson which Bismarck, Palmerston and Gray learned in the
+last century is now being taught by economic pressure to the ruling
+class of the United States.</p>
+
+<p>The elder generation of American business men was not trained for world
+domination. To them the lesson comes hard. The business men of the
+younger generation are picking it up, however, with a quickness born of
+paramount necessity.</p>
+
+<h3>2. <i>Training Imperialists</i></h3>
+
+<p>Every great imperial structure has had simple beginnings. Each imperial
+ruling class has doubtless felt misgivings, during the early years of
+its authority. Hesitating, uncertain, they have cast glances over their
+shoulders<span class='pagenum'><a name="Page_220" id="Page_220">[Pg 220]</a></span> towards that which was, but even while they were looking
+backward the forces that had made them rulers were thrusting them still
+farther forward along the path of imperial power. Then as generation
+succeeded generation, the rulers learned their lesson, building a
+tradition of rulership and authority that was handed down from father to
+son; acquiring a vision of world organization and world power that gave
+them confidence to go forward to their own undoing. The masters of
+public life in Rome were such people; the present masters of British
+economic and political affairs are such people.</p>
+
+<p>American imperialists still are in the making. Until 1900 their eyes
+were set almost exclusively upon empire within the United States. Those
+who, before 1860, dreamed of a slave power surrounding the Gulf of
+Mexico, were thrust down and their places taken by builders of railroads
+and organizers of trusts. To-day the sons and grandsons of that
+generation of exploiters who confined their attention to continental
+territory, are compelled, by virtue of the organization which their
+sires and grandsires established, to seek Empire outside the boundaries
+of North America.</p>
+
+<p>During the years when the leaders of American business life were
+spending the major part of their time in "getting rich," the sweep of
+social and economic forces was driving the United States toward its
+present imperial position. Now the position has been attained, those in
+authority have no choice but to accept the responsibilities which
+accompany it.</p>
+
+<p>Economically the United States is a world power. The war and the
+subsequent developments have forced the country suddenly into a position
+of leadership among the capitalist nations. The law of capitalism is:
+Struggle to dispose of your surplus, otherwise you cannot survive. This
+law has laid its heavy hand upon Great Britain, upon France, upon
+Germany, and now it has struck with full force into the isolated,
+provincial life of the United States. It is the law&mdash;immutable as the
+system of gravitation.<span class='pagenum'><a name="Page_221" id="Page_221">[Pg 221]</a></span> While the present system of economic life
+exists, this law will continue to operate. Therefore the masters of
+American life have no alternative. If they would survive, they must
+dispose of their surplus.</p>
+
+<p>Politically the United States is recognized as one of the leaders of the
+world. Despite its tradition of isolation, despite the unwillingness of
+its statesmen to enter new paths, despite the indifference of its people
+to international affairs, the resources and raw materials required by
+the industrial nations of Europe, the rapidly growing surplus and the
+newly acquired foreign markets and investments make the United States an
+integral part of the life of the world.</p>
+
+<p>The ruling class in the United States has no more choice than the rulers
+of a growing city whose boundaries are extending with each increment of
+population. If it is to continue as a ruling class, it must accept
+conditions as they are. The first of these conditions is that the United
+States is a world power neither because of its virtue nor because of its
+intelligence in the delicacies of the world politics, but because of the
+sheer might of its economic organization.</p>
+
+<p>Economic necessity has forced the United States into the front rank
+among the nations of the world. Economic necessity is forcing the ruling
+class of the United States to occupy the position of world leadership,
+to strengthen it, to consolidate it, and to extend it at every
+opportunity. The forces that played beside the yellow Tiber and the
+sluggish Nile are very much the same as those which led Napoleon across
+the wheat fields of Europe and that are to-day operating in Paris,
+London, and in New York. The forces that pushed the Roman Empire into
+its position of authority and led to the organization of Imperial
+Britain are to-day operating with accelerated pace in the United States.
+The sooner the American people, and particularly those who are directing
+public policy, wake up to this simple but essential fact, the sooner
+will doubt and misunderstanding be removed, the sooner will the issues
+be drawn and the nation's course be charted.</p>
+
+<p><span class='pagenum'><a name="Page_222" id="Page_222">[Pg 222]</a></span></p>
+
+<h3>3. <i>The Logical Goal</i></h3>
+
+<p>The logical goal of the American plutocracy is the economic and
+incidentally the political control of the world. The rulers of Macedon
+and Assyria, Rome and Carthage, of Britain and France labored for
+similar reasons to reach this same goal. It is economic fate. Kings and
+generals were its playthings, obeying and following the call of its destiny.</p>
+
+<p>The rulers of antiquity were limited by a lack of transportation
+facilities; their "world" was small, including the basin of the
+Mediterranean and the land surrounding the Persian Gulf and the Indian
+Ocean, nevertheless, they set out, one after another, to conquer it.
+To-day the rapid accumulation of surplus and the speed and ease of
+communication, the spread of world knowledge and the larger means of
+organization make it even more necessary than it was of old for the
+rulers of an empire to find a larger and ever larger place in the sun.
+The forces are more pressing than ever before. The times call more
+loudly for a genius with imagination, foresight and courage who will use
+the power at his disposal to write into political history the gains that
+have already been made a part of economic life. Let such a one arise in
+the United States, in the present chaos of public thought, and he could
+not only himself dictate American public policy for the remainder of his
+life, but in addition, he could, within a decade, have the whole
+territory from the Canadian border to the Panama Canal under the
+American Flag, either as conquered or subject territory; he could
+establish a Chinese wall around South American trade and opportunities
+by a very slight extension of the Monroe Doctrine; he could have in hand
+the problem of an economic if not a political union with Canada, and
+could be prepared to measure swords with the nearest economic rival,
+either on the high seas or in any portion of the world where it might
+prove necessary to join battle.</p>
+
+<p><span class='pagenum'><a name="Page_223" id="Page_223">[Pg 223]</a></span></p><p>Such a program would be a departure from the traditions of American
+public life, but the traditions, built by a nation of farmers, have
+already lost their significance. They are historic, with no contemporary
+justification. The economic life that has grown up since 1870 of
+necessity will create new public policies.</p>
+
+<p>The success of such a program would depend upon four things:</p>
+
+<p>1. A co&ouml;rdination of American economic life.</p>
+
+<p>2. A fast grip on the agencies for shaping public opinion.</p>
+
+<p>3. A body of citizens, martial, confident, restless, ambitious.</p>
+
+<p>4. A ruling class with sufficient imagination to paint, in warm
+sympathetic colors, the advantages of world dominion; and with
+sufficient courage to follow out imperial policy, regardless of ethical
+niceties, to its logical goal of world conquest.</p>
+
+<p>All four of these requisites exist in the United States to-day, awaiting
+the master hand that shall unite them. Many of the leaders of American
+public life know this. Some shrink from the issue, because they are
+unaccustomed to dream great dreams, and are terrified by the immensity
+of large thoughts. Others lack the courage to face the new issues. Still
+others are steadily maneuvering themselves into a position where they
+may take advantage of a crisis to establish their authority and work
+their imperial will. The situation grows daily more inviting; the
+opportunity daily more alluring. The war-horse, saddled and bridled, is
+pawing the earth and neighing. How soon will the rider come?</p>
+
+<h3>4. <i>Eat or Be Eaten</i></h3>
+
+<p>The American ruling class has been thrown into a position of authority
+under a system of international economic competition that calls for
+initiative and courage. Under this system, there are two
+possibilities,&mdash;eat or be eaten!</p>
+
+<p><span class='pagenum'><a name="Page_224" id="Page_224">[Pg 224]</a></span></p><p>There is no middle ground, no half way measure. It is impossible to
+stop or to turn back. Like men engaged on a field of battle, the
+contestants in this international economic struggle must remain with
+their faces toward the enemy, fighting for every inch that they gain,
+and holding these gains with their bodies and their blood, or else they
+must turn their backs, throw away their weapons, run for their lives,
+and then, hiding on the neighboring hills, watch while the enemy
+despoils the camp, and then applies a torch to the ruins.</p>
+
+<p>The events of the great war prove, beyond peradventure, that in the wolf
+struggle among the capitalist nations, no rules are respected and no
+quarter given. Again and again the leaders among the allied
+statesmen&mdash;particularly Mr. Lloyd George and Mr. Wilson&mdash;appealed to the
+German people over the heads of their masters with assurances that the
+war was being fought against German autocracy, not against Germans.
+"When will the German people throw off their yoke?" asked one Allied
+diplomat. The answer came in November, 1918. A revolution was contrived,
+the Kaiser fled the country, the autocracy was overthrown. Germans
+ceased to fight with the understanding that Mr. Wilson's Fourteen Points
+should be made the foundation of the Peace. The armistice terms violated
+the spirit if not the letter of the fourteen points; the Peace Treaty
+scattered them to the winds. Under its provisions Germany was stripped
+of her colonies; her investments in the allied possessions were
+confiscated; her ships were taken; three-quarters of her iron ore and a
+third of her coal supply were turned over to other powers; motor trucks,
+locomotives, and other essential parts of her economic mechanism were
+appropriated. Austria suffered an even worse fate, being "drawn and
+quartered" in the fullest sense of the term. After stripping the
+defeated enemies of all available booty, levying an indeterminate
+indemnity, and dismembering the German and Austrian Empires, the Allies
+established for thirty years a Reparation Commission, which is virtually
+the economic dictator of Europe. Thus for a generation to come, the
+economic life of the vanquished<span class='pagenum'><a name="Page_225" id="Page_225">[Pg 225]</a></span> Empires will be under the active
+supervision and control of the victors. Never did a farmer's wife pluck
+a goose barer than the Allies plucked the Central Powers. (See the
+Treaty, also "The Economic Consequences of the Peace," J. M. Keynes. New
+York, Harcourt, Brace &amp; Howe, 1920.)</p>
+
+<p>Under the armistice terms and the Peace Treaty the Allies did to Germany
+and Austria exactly what Germany and Austria would have done to France
+and Great Britain had the war turned out differently. The Allied
+statesmen talked much about democracy, but when their turn came they
+plundered and despoiled with a practiced imperial hand. France and
+Britain, as well as Germany and Austria, were capitalist Empires. The
+Peace embodies the essential economic morality of capitalist
+imperialism, the morality of "Eat or be eaten."</p>
+
+<h3>5. <i>The Capitalists and War</i></h3>
+
+<p>The people and even the masters of America are inexperienced in this
+international struggle. Among themselves they have experimented with
+competitive industrialism on a national scale. Now, brought face to face
+with the world struggle, many of them revolt against it. They deplore
+the necessities that lead nations to make war on one another. They
+supported the late war "to end war." They gave, suffered and sacrificed
+with a keen, idealistic desire to "make the world safe for democracy."
+They might as well have sought to scatter light and sunshine from a
+cloudbank.</p>
+
+<p>The masters of Europe, who have learned their trade in long years of
+intrigue, diplomacy and war, feel no such repugnance. They play the
+game. The American people are of the same race-stocks as the leading
+contestants in the European struggle. They are not a whit less
+ingenious, not a whit less courageous, not a whit less determined. When
+practice has made them perfect they too will play<span class='pagenum'><a name="Page_226" id="Page_226">[Pg 226]</a></span> the game just as well
+as their European cousins and their play will count for more because of
+the vast economic resources and surpluses which they possess.</p>
+
+<p>American statesmen in the field of international diplomacy are like
+babies, taking their first few steps. Later the steps come easier and
+easier, until a child, who but a few months ago could not walk, has
+learned to romp and sport about. The masters of the United States are
+untrained in the arts of international intrigue. They showed their
+inferiority in the most painful way during the negotiations over the
+Paris Treaty. They are as yet unschooled in international trade, banking
+and finance. They are also inexperienced in war, yet, having only raw
+troops, and little or no equipment, within two years they made a notable
+showing on the battlefields of Europe. Now they are busy learning their
+financial lessons with an equal facility. A generation of contact with
+world politics will bring to the fore diplomats capable of meeting
+Europe's best on their own ground. What Europe has learned, America can
+learn; what Europe has practiced, America can practice, and in the end
+she may excel her teachers.</p>
+
+<p>To-day economic forces are driving relentlessly. Surplus is accumulating
+in a geometric ratio&mdash;surplus piling on surplus. This surplus must be
+disposed of. While the remainder of the world&mdash;except Japan&mdash;is
+staggering under intolerable burdens of debt and disorganization, the
+United States emerges almost unscathed from the war, and prepares in
+dead earnest to enter the international struggle,&mdash;to play at the master
+game of "eat or be eaten."</p>
+
+<p>Pride, ambition and love of gain and of power are pulling the American
+plutocrats forward. The world seems to be within their grasp. If they
+will reach out their hands they may possess it! They have assumed a
+great responsibility. As good Americans worthy of the tradition of their
+ancestors, they must see this thing through to the end! They must win,
+or die in the attempt; and it is in this spirit that they are going forward.</p>
+
+<p>The American capitalists do not want war with Great<span class='pagenum'><a name="Page_227" id="Page_227">[Pg 227]</a></span> Britain or with any
+other country. They are not seeking war. They will regret war when it comes.</p>
+
+<p>War is expensive, troublesome and dangerous. The experiences of Europe
+in the War of 1914 have taught some lessons. The leaders and thinkers
+among the masters of America have visited Europe. They have seen the old
+institutions destroyed, the old customs uprooted, the old faiths
+overturned. They have seen the economic order in which they were vitally
+concerned hurled to the earth and shattered. They have seen the red flag
+of revolution wave where they had expected nothing but the banner of
+victory. They have seen whole populations, weary of the old order, throw
+it aside with an impatient gesture and bring a new order into being.
+They have good reasons to understand and fear the disturbing influences
+of war. They have felt them even in the United States&mdash;three thousand
+miles away from the European conflict. How much more pressing might this
+unrest be if the United States had fought all through the war, instead
+of coming in when it was practically at an end!</p>
+
+<p>Then there is always the danger of losing the war&mdash;and such a loss would
+mean for the United States what it has meant for Germany&mdash;economic slavery.</p>
+
+<p>Presented with an opportunity to choose between the hazards of war and
+the certainties of peace most of the capitalist interests in the United
+States would without question choose peace. There are exceptions. The
+manufacturers of munitions and of some of the implements and supplies
+that are needed only for war purposes, undoubtedly have more to gain
+through war than through peace, but they are only a small element in a
+capitalist world which has more to gain through peace than through war.</p>
+
+<p>But the capitalists cannot choose. They are embedded in an economic
+system which has driven them&mdash;whether they liked it or not&mdash;along a path
+of imperialism. Once having entered upon this path, they are compelled
+to follow it into the sodden mire of international strife.</p>
+
+<p><span class='pagenum'><a name="Page_228" id="Page_228">[Pg 228]</a></span></p>
+
+<h3>6. <i>The Imperial Task</i></h3>
+
+<p>The American ruling class&mdash;the plutocracy&mdash;must plan to dominate the
+earth; to exploit it, to exact tribute from it. Rome did as much for the
+basin of the Mediterranean. Great Britain has done it for Africa and
+Australia, for half of Asia, for four million square miles in North
+America. If the people of one small island, poorly equipped with
+resources, can achieve such a result, what may not the people of the
+United States hope to accomplish?</p>
+
+<p>That is the imperial task.</p>
+
+<blockquote><p>1. American economic life must be unified. Already much of this
+work has been done.</p>
+
+<p>2. The agencies for shaping public opinion must be secured. Little
+has been left for accomplishment in this direction.</p>
+
+<p>3. A martial, confident, restless, ambitious spirit must be
+generated among the people. Such a result is being achieved by the
+combination of economic and social forces that inhere in the
+present social system.</p>
+
+<p>4. The ruling class must be schooled in the art of rulership. The
+next two generations will accomplish that result.</p></blockquote>
+
+<p>The American plutocracy must carry on. It must consolidate its gains and
+move forward to greater achievements, with the goal clearly in mind and
+the necessities of imperial power thoroughly mastered and understood.</p>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_229" id="Page_229">[Pg 229]</a></span></p>
+
+<h2><a name="XVII_THE_NEW_IMPERIAL_ALIGNMENT" id="XVII_THE_NEW_IMPERIAL_ALIGNMENT"></a>XVII. THE NEW IMPERIAL ALIGNMENT</h2>
+
+<h3>1. <i>A Survey of the Evidence</i></h3>
+
+<p>Through the centuries empires have come and gone. In each age some
+nation or people has emerged&mdash;stronger, better organized, more
+aggressive, more powerful than its neighbors&mdash;and has conquered
+territory, subjugated populations, and through its ruling class has
+exploited the workers at home and abroad.</p>
+
+<p>Europe has been for a thousand years the center of the imperial
+struggle,&mdash;the struggle which called into being the militarism so hated
+by the European peoples. It was from that struggle that millions fled to
+America, where they hoped for liberty and peace.</p>
+
+<p>The eighteenth century witnessed the rise of Great Britain to a position
+of world authority. During the nineteenth century she held her place
+against all rivals. With the assistance of Prussia, she overthrew
+Napoleon at Waterloo. In the Crimean War and the Russo-Japanese War she
+halted the power of the Czar. Half a century after Waterloo Germany,
+under the leadership of Prussia won the Franco-Prussian War, and by that
+act became the leading rival of the British Empire. Following the war,
+which gave Germany control of the important resources included in Alsace
+and Lorraine, there was a steady increase in her industrial efficiency;
+the success of her trade was as pronounced as the success of her
+industries, and by 1913 the Germans had a merchant fleet and a navy
+second only to those of Great Britain.</p>
+
+<p>Germany's economic successes, and her threat to build a railroad from
+Berlin to Bagdad and tap the riches of the East, led the British to form
+alliances with their traditional enemies&mdash;the French and the Russians.
+Russia, after the<span class='pagenum'><a name="Page_230" id="Page_230">[Pg 230]</a></span> breakdown of Czarism in 1917, dropped out of the
+Entente, and the United States took her place among the Allies of the
+British Empire. During the struggle France was reduced to a mere shell
+of her former power. The War of 1914 bled her white, loaded her with
+debt, disorganized her industries, demoralized her finances, and
+although it restored to her important mineral resources, it left her too
+weak and broken to take real advantage of them.</p>
+
+<p>The War of 1914 decided the right of Great Britain to rule the Near East
+as well as Southern Asia and the strategic points of Africa. In the
+stripping of the vanquished and in the division of the spoils of war the
+British lion proved to be the lion indeed. But the same forces that gave
+the British the run of the Old World called into existence a rival in
+the New.</p>
+
+<p>People from Britain, Germany and the other countries of Northern Europe,
+speaking the English language and fired with the conquering spirit of
+the motherland, had been, for three centuries, taming the wilderness of
+North America. They had found the task immense, but the rewards equally
+great. When the forces of nature were once brought into subjection, and
+the wilderness was inventoried, it proved to contain exactly those
+stores that are needed for the success of modern civilization. With the
+Indians brushed aside, and the Southwest conquered from Mexico, the new
+ruling class of successful business men established itself, and the
+matter of safeguarding property rights, of building industrial empires
+and of laying up vast stores of capital and surplus followed as a matter
+of course.</p>
+
+<p>Europe, busy with her own affairs, paid little heed to the New World,
+except to send to it some of her most rugged stock and much of her
+surplus wealth. The New World, left to itself, pursued its way&mdash;in
+isolation, and with an intensity proportioned to the size of the task in
+hand and the richness of the reward.</p>
+
+<p>The Spanish War in 1898 and the performance of the Canadians in the Boer
+War of 1899 astounded the world,<span class='pagenum'><a name="Page_231" id="Page_231">[Pg 231]</a></span> but it was the War of 1914 that really
+waked the Europeans to the possibilities of the Western peoples. The
+Canadians proved their worth to the British armies. The Americans showed
+that they could produce prodigious amounts of the necessaries of war,
+and when they did go in, they inaugurated a shipping program, raised and
+dispatched troops, furnished supplies and provided funds to an extent
+which, up to that time, was considered impossible. The years from 1914
+to 1918 established the fact that there was, in the West, a colossus of
+economic power.</p>
+
+<h3>2. <i>The New International Line-Up</i></h3>
+
+<p>There are four major factors in the new international line-up. The first
+is Russia; the second is the Japanese Empire; the third is the British
+Empire and the fourth is the American Empire. Italy has neither the
+resources, the wealth nor the population necessary to make her a factor
+of large importance in the near future. France is too weak economically,
+too overloaded with debt and too depleted in population to play a
+leading r&ocirc;le in world affairs.</p>
+
+<p>The Russian menace is immediate. Bolshevism is not only the antithesis
+of Capitalism but its mortal enemy. If Bolshevism persists and spreads
+through Central Europe, India and China, capitalism will be wiped from
+the earth.</p>
+
+<p>A federation of Russia, the Baltic states, the new border provinces, and
+the Central Empires on a socialist basis would give the socialist states
+of central and northern Europe most of the European food area, a large
+portion of the European raw material area and all of the technical skill
+and machinery necessary to make a self-supporting economic unit. The two
+hundred and fifty millions of people in Russia and Germany combined in
+such a socialist federation would be as irresistible economically as
+they would be from a military point of view.</p>
+
+<p>Such a Central European federation, developing as it must along the
+logical lines that lead into India and China<span class='pagenum'><a name="Page_232" id="Page_232">[Pg 232]</a></span> would be the strongest
+single unit in the world, viewed from the standpoint of resources, of
+population, of productive power or of military strength. The only
+possible rivals to such a combination would be the widely scattered
+forces of the British Empire and the United States, separated from it by
+the stretches of the Atlantic Ocean. Against such a grouping Japan would
+be powerless because it would deprive her of the source of raw materials
+upon which she must rely for her economic development. Great Britain
+with her relatively small population and her rapidly diminishing
+resources could make no head against such a combination even with the
+assistance of her colonial empire. Northern India is as logical a home
+for Bolshevism as Central China or South-eastern Russia. Connect
+European Russia, Germany, Austria-Hungary, Siberia, India and China with
+bonds that make effective co&ouml;peration possible and these
+countries&mdash;containing nearly two-thirds of the population of the world,
+and possessed of the resources necessary to maintain a modern
+civilization&mdash;could laugh at outside interference.</p>
+
+<p>Two primary difficulties confront the organizers of the Federated
+Socialist Republics of Europe and Asia. One is nationality, language,
+custom and tradition, together with the ancient antagonisms which have
+been so carefully nurtured through the centuries. The other is the
+frightful economic disorganization prevalent throughout Central
+Europe,&mdash;a disorganization which would be increased rather than
+diminished by the establishment of new forms of economic life. Even if
+such an organization were perfected, it must remain, for a long time to
+come, on a defensive basis.</p>
+
+<h3>3. <i>The Yellow Peril</i></h3>
+
+<p>The "yellow peril" thus far is little more than the Japanese menace to
+British and American trade in the Far East. The Japanese Archipelago is
+woefully deficient in coal, iron, petroleum, water power and
+agricultural land. The country is over-populated and must depend for
+its<span class='pagenum'><a name="Page_233" id="Page_233">[Pg 233]</a></span> supplies of food and raw materials upon continental Asia. There
+seems to be no probability that Japan and China can make any effective
+working agreement in the near future that will constitute an active
+menace to the supremacy of the white race. Alone Japan is too weak in
+resources and too sparse in population. Combined with China she would be
+formidable, but her military policy in Korea and in the Shantung
+Province have made any effective co&ouml;peration with China at least
+temporarily impossible.</p>
+
+<p>Furthermore, the Japanese are not seeking world conquest. On the
+contrary, they are bent upon maintaining their traditional aloofness by
+having a Monroe Doctrine for the East. This doctrine will be summed up
+in the phrase, "The East for the Easterners,"&mdash;the easterners being the
+Japanese. Such a policy would prove a serious menace to the trade of the
+United States and of Great Britain. It would prove still more of a
+hindrance to the investment of American and British capital in the very
+promising Eastern enterprises, and would close the door on the Western
+efforts to develop the immense industrial resources of China. The recent
+"Chinese Consortium," in which Japan joined with great reluctance,
+suggests that the major capitalist powers have refused to recognize the
+exclusive right of Japan to the economic advantages of the Far East. How
+seriously this situation will be taken by the United States and Great
+Britain depends in part upon the vigor with which Japan prosecutes her
+claims and in part upon the preoccupation of these two great powers with
+Bolshevism in Europe and with their own competitive activities in ship
+building, trade, finance and armament.</p>
+
+<h3>4. <i>The British and the American Empires</i></h3>
+
+<p>The two remaining major forces in world economics and politics are the
+British Empire and the American Empire,&mdash;the mistress of the world, and
+her latest rival in the competition for world power. Between them,
+to-day, most of the world is divided. The British Empire includes the<span class='pagenum'><a name="Page_234" id="Page_234">[Pg 234]</a></span>
+Near East, Southern Asia, Africa, Australia and half of North America.
+Dogging her are Germany, France, Russia and Italy, and, as she goes to
+the Far East,&mdash;Japan. The United States holds the Western Hemisphere,
+where she is supreme, with no enemy worthy the name.</p>
+
+<p>The British power was shaken by the War of 1914. Never, in modern times,
+had the British themselves, been compelled to do so much of the actual
+fighting. The war debt and the disorganization of trade incident to the
+war period proved serious factors in the curtailment of British economic
+supremacy. At the same time, the territorial gains of the British were
+enormous, particularly in the Near East.</p>
+
+<p>The Americans secured real advantages from the war. They grew immensely
+rich in profiteering during the first three years, they emerged with a
+relatively small debt, with no great loss of life, and with the greatest
+economic surpluses and the greatest immediate economic advantages
+possessed by any nation of the world.</p>
+
+<p>The British Empire was the acknowledged mistress of the world in 1913.
+Her nearest rival (Germany) had one battleship to her two; one ton of
+merchant shipping to her three, and two dollars of foreign investments
+to her five. This rivalry was punished as the successive rivals of the
+British Empire have been punished for three hundred years.</p>
+
+<p>The war was won by the British Empire and her Allies, but in the hour of
+victory a new rival appeared. By 1920 that rival had a naval program
+which promised a fleet larger than the British fleet in 1924 or 1925;
+within three years she had increased her merchant tonnage to two-thirds
+of the British tonnage, and her foreign investments were three times the
+foreign investments of Great Britain. This new rival was the American
+Empire&mdash;whose immense economic strength constituted an immediate threat
+to the world power of Great Britain.</p>
+
+<p><span class='pagenum'><a name="Page_235" id="Page_235">[Pg 235]</a></span></p>
+
+<h3>5. <i>The Next Incident in the Great War</i></h3>
+
+<p>Some nation, or some group of nations has always been in control of the
+known world or else in active competition for the right to exercise such
+a control. The present is an era of competition.</p>
+
+<p>Capitalism has revolutionized the world's economic life. By 1875 the
+capitalist nations were in a mad race to determine which one should
+dominate the capitalist world and have first choice among the
+undeveloped portions of the earth. The competitors were Great Britain,
+Germany, France, Russia and Italy. Japan and the United States did not
+really enter the field for another generation.</p>
+
+<p>The War of 1914 decided this much:&mdash;that France and Italy were too weak
+to play the big game in a big way, that Germany could not compete
+effectively for some time to come; that the Russians would no longer
+play the old game at all. There remained Japan, Great Britain and the
+United States and it is among these three nations that the capitalist
+world is now divided. Japan is in control of the Far East. Great Britain
+holds the Near East, Africa and Australia; the United States dominates
+the Western Hemisphere.</p>
+
+<p>The Great War began in 1914. It will end when the question is decided as
+to which of these three empires will control the Earth.</p>
+
+<p>Great Britain has been the dominant factor in the world for a century.
+She gained her position after a terrific struggle, and she has
+maintained it by vanquishing Holland, Spain, France and Germany.</p>
+
+<p>The United States is out to capture the economic supremacy of the earth.
+Her business men say so frankly. Her politicians fear that their
+constituents are not as yet ready to take such a step. They have been
+reassured, however, by the presidential vote of November, 1920.
+<span class='pagenum'><a name="Page_236" id="Page_236">[Pg 236]</a></span>American business life already is imperial, and political sentiment is
+moving rapidly in the same direction.</p>
+
+<p>Great Britain holds title to the pickings of the world. America wants
+some or all of them. The two countries are headed straight for a
+conflict, which is as inevitable as morning sunrise, unless the menace
+of Bolshevism grows so strong, and remains so threatening that the great
+capitalist rivals will be compelled to join forces for the salvation of
+capitalist society.</p>
+
+<p>As economic rivalries increase, competition in military and naval
+preparation will come as a matter of course. Following these will be the
+efforts to make political alliances&mdash;in the East and elsewhere.</p>
+
+<p>These two countries are old time enemies. The roots of that enmity lie
+deep. Two wars, the white hot feeling during the Civil War, the
+anti-British propaganda, carried, within a few years, through the
+American schools, the traditions among the officers in the American
+navy, the presence of 1,352,251 Irish born persons in the United States
+(1910), the immense plunder seized by the British during the War of
+1914,&mdash;these and many other factors will make it easy to whip the
+American people into a war-frenzy against the British Empire.</p>
+
+<p>Were there no economic rivalries, such antagonisms might slumber for
+decades, but with the economic struggle so active, these other matters
+will be kept continually in the foreground.</p>
+
+<p>The capitalists of Great Britain have faced dark days and have
+surmounted huge obstacles. They are not to be turned back by the threat
+of rivalry. The American capitalists are backed by the greatest
+available surpluses in the world; they are ambitious, full of enthusiasm
+and energy, they are flushed with their recent victory in the world war,
+and overwhelmed by the unexpected stores of wealth that have come to
+them as a result of the conflict. They are imbued with a boundless faith
+in the possibilities of their country. Neither Great Britain nor the
+United States is<span class='pagenum'><a name="Page_237" id="Page_237">[Pg 237]</a></span> in a frame of mind to make concessions. Each is
+confident&mdash;the British with the traditional confidence of centuries of
+world leadership; the Americans with the buoyant, idealistic confidence
+of youth. It is one against the other until the future supremacy of the world is decided.</p>
+
+<h3>6. <i>The Imperial Task</i></h3>
+
+<p>American business interests are engaged in the work of building an
+international business structure. American industry, directed from the
+United States, exploiting foreign resources for American profit, and
+financed by American institutions, is gaining a footing in Latin
+America, in Europe and Asia.</p>
+
+<p>The business men of Rome built such a structure two thousand years ago.
+They competed with and finally crushed their rivals in Tyre, Corinth and
+Carthage. In the early days of the Empire, they were the economic
+masters, as well as the political masters of the known world.</p>
+
+<p>Within two centuries the business men of Great Britain have built an
+international business structure that has known no equal since the days
+of the C&aelig;sars. Perhaps it is greater, even, than the economic empire of
+the Romans. At any rate, for a century that British empire of commerce
+and industry has gone unchallenged, save by Germany. Germany has been
+crushed. But there is an industrial empire rising in the West. It is
+new. Its strength is as yet undetermined. It is unco&ouml;rdinated. A new era
+has dawned, however, and the business men of the United States have made
+up their minds to win the economic supremacy of the earth.</p>
+
+<p>Already the war is on between Great Britain and the United States. The
+two countries are just as much at war to-day as Great Britain and
+Germany were at war during the twenty years that preceded 1914. The
+issues are essentially the same in both cases,&mdash;commercial and economic
+in character, and it is these economic and <span class='pagenum'><a name="Page_238" id="Page_238">[Pg 238]</a></span>commercial issues that are
+the chief causes of modern military wars&mdash;that are in themselves
+economic wars which may at any moment be transferred to the military arena.</p>
+
+<p>British capitalists are jealously guarding the privileges that they have
+collected through centuries of business and military conflict. The
+American capitalists are out to secure these privileges for themselves.
+On neither side would a military settlement of the issue be welcomed. On
+both sides it would be regarded as a painful necessity. War is an
+incident in imperialist policy. Yet the position of the imperialist as
+an international exploiter depends upon his ability to make war
+successfully. War is a part of the price that the imperialist must pay
+for his opportunity to exploit and control the earth.</p>
+
+<p>After Sedan, it was Germany versus Great Britain for the control of
+Europe. After Versailles it is the United States versus Great Britain
+for the control of the capitalist earth. Both nations must spend the
+next few years in active preparation for the conflict.</p>
+
+<p>The governments of Great Britain and the United States are to-day on
+terms of greatest intimacy. Soon an issue will arise&mdash;perhaps over
+Mexico, perhaps over Persia, perhaps over Ireland, perhaps over the
+extension of American control in the Caribbean. There is no difficulty
+of finding a pretext.</p>
+
+<p>Then there will follow the time-honored method of arousing the people on
+either side to wrath against those across the border. Great Britain will
+point to the race-riots and negro-lynchings in America as a proof that
+the people of the United States are barbarians. British editors will
+cite the wanton taking of the Canal Zone as an indication of the
+willingness of American statesmen to go to any lengths in their effort
+to extend their dominion over the earth. The newspapers of the United
+States will play up the terrorism and suppression in Ireland and there
+are many Irishmen more than ready to lend a hand in such an enterprise;
+tyranny in India will come in for a generous share of comment; then
+there are the relations between Great<span class='pagenum'><a name="Page_239" id="Page_239">[Pg 239]</a></span> Britain and the Turks, and above
+all, there are the evidences in the Paris Treaty of the way in which
+Great Britain is gradually absorbing the earth. Unless the power of
+labor is strong enough to turn the blow, or unless the capitalists
+decide that the safety of the capitalist world depends upon their
+getting together and dividing the plunder, the result is inevitable.</p>
+
+<p>The United States is a world Empire in her own right. She dominates the
+Western Hemisphere. Young and inexperienced, she nevertheless possesses
+the economic advantages and political authority that give her a voice in
+all international controversies. Only twenty years have passed since the
+organizing genius of America turned its attention from exclusively
+domestic problems to the problems of financial imperialism that have
+been agitating Europe for a half a century. The Great War showed that
+American men make good soldiers, and it also showed that American wealth
+commands world power.</p>
+
+<p>With the aid of Russia, France, Japan and the United States Great
+Britain crushed her most dangerous rival&mdash;Germany. The struggle which
+destroyed Germany's economic and military power erected in her stead a
+more menacing economic and military power&mdash;the United States. Untrained
+and inexperienced in world affairs, the master class of the United
+States has been placed suddenly in the title r&ocirc;le. America over night
+has become a world empire and over night her rulers have been called
+upon to think and act like world emperors. Partly they succeeded, partly
+they bungled, but they learned much. Their appetites were whetted, their
+imaginations stirred by the vision of world authority. To-day they are
+talking and writing, to-morrow they will act&mdash;no longer as novices, but
+as masters of the ruling class in a nation which feels herself destined
+to rule the earth.</p>
+
+<p>The imperial struggle is to continue. The Japanese Empire dominates the
+Far East; the British Empire dominates Southern Asia, the Near East,
+Africa and Australia; the American Empire dominates the Western<span class='pagenum'><a name="Page_240" id="Page_240">[Pg 240]</a></span>
+Hemisphere. It is impossible for these three great empires to remain in
+rivalry and at peace. Economic struggle is a form of war, and the
+economic struggle between them is now in progress.</p>
+
+<h3>7. <i>Continuing the Imperial Struggle</i></h3>
+
+<p>The War of 1914 was no war for democracy in spite of the fact that
+millions of the men who died in the trenches believed that they were
+fighting for freedom. Rather it was a war to make the world safe for the
+British Empire. Only in part was the war successful. The old world was
+made safe by the elimination of Britain's two dangerous rivals&mdash;Germany
+and Russia; but out of the conflict emerged a new rival&mdash;unexpectedly
+strong, well equipped and eager for the conflict.</p>
+
+<p>The war did not destroy imperialism. It was fought between five great
+empires to determine which one should be supreme. In its result, it gave
+to Great Britain rather than to Germany the right to exploit the
+undeveloped portions of Asia and of Africa.</p>
+
+<p>The Peace&mdash;under the form of "mandates"&mdash;makes the process of
+exploitation easier and more legal than it ever has been in the past.
+The guarantees of territorial integrity, under the League Covenant, do
+more than has ever been done heretofore to preserve for the imperial
+masters of the earth their imperial prerogatives.</p>
+
+<p>New names are being used but it is the old struggle. Egypt and India
+helped to win the war, and by that very process, they fastened the
+shackles of servitude more firmly upon their own hands and feet. The
+imperialists of the world never had less intention than they have to-day
+of quitting the game of empire building. Quite the contrary&mdash;a wholly
+new group of empire builders has been quickened into life by the
+experiences of the past five years.</p>
+
+<p>The present struggle for the possession of the oil fields of the world
+is typical of the economic conflicts that are involved in imperial
+struggles. For years the capitalists<span class='pagenum'><a name="Page_241" id="Page_241">[Pg 241]</a></span> of the great investing nations
+have been fighting to control the oil fields of Mexico. They have hired
+brigands, bought governors, corrupted executives. The war settled the
+Mexican question in favor of the United States. Mexico, considered
+internationally, is to-day a province of the American Empire.</p>
+
+<p>During the blackest days of the war, when Paris seemed doomed, the
+British divided their forces. One army was operating across the deserts
+of the Near East. For what purpose? When the Peace was signed, Great
+Britain held two vantage points&mdash;the oil fields of the Near East and the
+road from Berlin to Bagdad.</p>
+
+<p>The late war was not a war to end war, nor was it a war for disarmament.
+German militarism is not destroyed; the appropriations for military and
+naval purposes, made by the great nations during the last two years, are
+greater than they have ever been in any peace years that are known to history.</p>
+
+<p>The world is preparing for war to-day as actively as it was in the years
+preceding the War of 1914. The years from 1914 to 1918 were the opening
+episodes; the first engagements of the Great War.</p>
+
+<p>There is no question, among those who have taken the trouble to inform
+themselves, but that the War of 1914 was fought for economic and
+commercial advantage. The same rivalries that preceded 1914 are more
+active in the world to-day than ever before. Hence the possibilities of
+war are greater by exactly that amount. The imperial struggle is being
+continued and a part of the imperial struggle is war.</p>
+
+<h3>8. <i>Again!</i></h3>
+
+<p>This monstrous thing called war will occur again! Not because any
+considerable number of people want it, not even because an active
+minority wills it, but because the present system of competitive
+capitalism makes war inevitable. Economic rivalries are the basis of
+modern wars and economic rivalries are the warp and woof of capitalism.</p>
+
+<p><span class='pagenum'><a name="Page_242" id="Page_242">[Pg 242]</a></span></p><p>To-day the rivalries are economic&mdash;in the fields of commerce and
+industry and finance. To-morrow they will be military.</p>
+
+<p>Already the nations have begun the competition in the building of tanks,
+battleships and airplanes. These instruments of destruction are built
+for use, and when the time comes, they will be used as they were between
+1914 and 1918.</p>
+
+<p>Again there will be the war propaganda&mdash;subtle at first, then more and
+more open. There will be stories of atrocities; threats of world
+conquest. "Preparedness" will be the cry.</p>
+
+<p>Again there will be the talk of "My country, right or wrong"; "Stand
+behind the President"; "Fall in line"; "Go over the top!"</p>
+
+<p>Again fear will stalk through the land, while hate and war lust are
+whipped into a frenzy.</p>
+
+<p>Again there will be conscription, and the straightest and strongest of
+the young men will leave their homes and join the colors.</p>
+
+<p>Again the most stalwart men of the nations will "dig themselves in" and
+slaughter one another for years on end.</p>
+
+<p>Again the truth-tellers will be mobbed and jailed and lynched, while
+those who champion the cause of the workers will be served with
+injunctions if they refuse to sell out to the masters.</p>
+
+<p>Again the profiteers will stop at home and reap their harvests out of
+the agony and the blood of the nation.</p>
+
+<p>Again, when the killing is over, a few old men, sitting around a table,
+will carve the world&mdash;stripping the vanquished while they reward the
+victors.</p>
+
+<p>Again the preparations will begin for the next war. The people will be
+fed on promises, phrases and lies. They will pay and they will die for
+the benefit of their masters, and thus the terrible tragedy of
+imperialism will continue to bathe the world in tears and in blood.</p>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_243" id="Page_243">[Pg 243]</a></span></p>
+
+<h2><a name="XVIII_THE_CHALLENGE_TO_IMPERIALISM" id="XVIII_THE_CHALLENGE_TO_IMPERIALISM"></a>XVIII. THE CHALLENGE TO IMPERIALISM</h2>
+
+<h3>1. <i>Revolutionary Protest</i></h3>
+
+<p>Since the Franco-Prussian War the people of Europe have been waking up
+to the failure of imperialism. The period has been marked by a rapid
+growth of Socialism on the continent and of trade-unionism in Great
+Britain. Both movements are expressions of an increasing working-class
+solidarity; both voice the sentiments of internationalism that were
+sounded so loudly during the revolutionary period of the eighteenth
+century.</p>
+
+<p>The rapid growth of the European labor movement worried the autocrats
+and imperialists. Bismarck suppressed it; the Russian police tortured
+it. Despite all of the efforts to check it or to crush it, the
+revolutionary movement in Europe gained force. The speeches and writings
+of the leaders were directed against the capitalist system, and the rank
+and file of the workers, rendered sharply class conscious by the
+traditions of class rule, responded to the appeal by organizing new
+forms of protest.</p>
+
+<p>The first revolutionary wave of the twentieth century broke in Russia in
+1905. The Russian Revolution of 1917 destroyed the old r&eacute;gime and
+replaced it first by a moderate or liberal and then by a radical
+communist control. Like all of the proletarian movements in Europe the
+Russian revolutionary movement was directed against "capitalism" and
+"imperialism" and despite the fact that there was no considerable
+development of the capitalist system in Russia, its imperial
+organization was so thoroughgoing, and the imperial attitude toward the
+working class had been so brutally revealed during the revolutionary
+demonstrations in 1905, that the people reacted with a true Slavic
+intensity against the despotism that they knew, which was that of an
+autocratic, feudal master-class.</p>
+
+<p><span class='pagenum'><a name="Page_244" id="Page_244">[Pg 244]</a></span></p><p>The international doctrines of the new Russian r&eacute;gime were expressed in
+the phrase "no forcible annexations, no punitive indemnities, the free
+development of all peoples." The keynote of its internal policy is
+contained in Section 16 of the Russian Constitution, which makes work
+the duty of every citizen of the Republic and proclaims as the motto of
+the new government the doctrine, "He that will not work neither shall he
+eat." The franchise is restricted. Only workers (including housekeepers)
+are permitted to vote. Profiteers and exploiters are specifically denied
+the right to vote or to hold office. Resources are nationalized together
+with the financial and industrial machinery of Russia. The Bill of
+Rights contained in the first section of the Russian Constitution is a
+pronouncement in favor of the liberty of the workers from every form of
+exploitation and economic oppression.</p>
+
+<p>The Russian revolution was directed against capitalism in Russia and
+against imperialism everywhere. This dramatic assault upon capitalist
+imperialism centered the eyes of the world upon Russia, making her
+experiment the outstanding feature of a period during which the workers
+were striving to realize the possibilities of a more abundant life for
+the masses of mankind.</p>
+
+<h3>2. <i>Outlawing Bolshevism</i></h3>
+
+<p>Capitalist diplomats were wary of the Kerensky r&eacute;gime because they did
+not feel certain how far the Russian people intended to go. The triumph
+of the Bolsheviki made the issue unmistakably clear. There could be no
+peace between Bolshevism and capitalism. From that day forward it was a
+struggle to determine which of the two economic systems should survive.</p>
+
+<p>During the years 1918 and 1919 the capitalist world organized one of the
+most effective advertising campaigns that has ever been staged. Every
+shred of evidence that, by any stretch of the imagination, could be
+distorted into an attack upon the Bolshevist r&eacute;gime, was scattered
+<span class='pagenum'><a name="Page_245" id="Page_245">[Pg 245]</a></span>broadcast over the world. Where evidence was lacking, rumor and
+innuendo were employed. The leading newspapers and magazines, prominent
+statesmen, educators, clergymen, scientists and public men in every walk
+of life went out of their way to denounce the Russian experiment in very
+much the same manner that the propertied interests of Europe had
+denounced the French experiment during the years that followed 1789.</p>
+
+<p>All of the great imperialist governments had at their disposal a vast
+machinery for the purveying of information&mdash;false or true as the case
+might demand. This public machinery like the machinery of private
+capitalism was turned against Bolshevism. The capitalist governments
+went farther by backing with money and supplies the counter
+revolutionary forces under Yudenich, Denekine, Seminoff, and Kolchak.
+Allied expeditions were landed on the soil of European and Asiatic
+Russia "to free the Russian people from the clutches of the Bolsheviki."
+A blockade was declared in which the Germans were invited to join (after
+the signing of the armistice), and the whole capitalist world united to
+starve into submission the men, women and children of revolutionary Russia.</p>
+
+<p>No event of recent times, not even the holy war against the autocracy of
+militarist Germany, had created such a unanimity of action among the
+Western nations. Bolshevism threatened the very existence of capitalism
+and as such its destruction became the first task of the capitalist world.</p>
+
+<p>The collapse of the capitalist efforts to destroy socialist Russia
+reflects the power of a new idea over the ancient form. The Allied
+expeditions into Russia met with hostility instead of welcome. The
+counter-revolutionary forces were overwhelmed by the red army. The
+buffer states made peace. The Allied soldiers mutinied when called upon
+to take part in a war against the forces of revolutionary Russia. "Holy
+Russia" became holy Russia indeed&mdash;recognized and respected by the
+proletarian forces throughout Europe.</p>
+
+<p><span class='pagenum'><a name="Page_246" id="Page_246">[Pg 246]</a></span></p>
+
+<h3>3. <i>The New Europe</i></h3>
+
+<p>Russia is the dramatic center of the European movement against
+capitalist imperialism, but the movement is not confined to Russia. Its
+activities are extended into every important country on the continent.</p>
+
+<p>Since March, 1917, when the first revolution occurred in Russia,
+absolute monarchy and divine, kingly rights have practically disappeared
+from Europe. Before the Russian Revolution, four-fifths of the people of
+Europe were under the sway of monarchs who exercised dictatorial power
+over the domestic and foreign affairs of their respective nations.
+Within two years, the Hohenzollerns, the Hapsburgs and the Romanoffs
+were driven from the thrones of Germany, of Austria and of Russia. Other
+rulers of lesser importance followed in their wake, until to-day, the
+old feudal power that held the political control over most of Europe in
+1914 has practically disappeared.</p>
+
+<p>This is the obvious thing&mdash;a revolution in the form of political
+government&mdash;the kind of revolution with which history usually deals.</p>
+
+<p>But there is another revolution proceeding in Europe, far more important
+because more fundamental&mdash;the economic and social revolution; the change
+in the form of breadwinning; the change in the relation between a man
+and the tools that he uses to earn his livelihood.</p>
+
+<p>Every one knows, now, that Czars and Kaisers and Emperors did not really
+control Europe before 1914, except in so far as they yielded to bankers
+and to business men. The crown and the scepter gave the appearance of
+power, but behind them were concessions, monopolies, economic
+preferments, and special privilege. The European revolution that began
+in 1917 with the Czar, did not stop with kings. It began with them
+because they were in such plain sight, but when it had finished with
+them it went right on to the bankers and the business men.</p>
+
+<p><span class='pagenum'><a name="Page_247" id="Page_247">[Pg 247]</a></span></p><p>War is destruction, organized and directed by the best brains
+available. It is merry sport for the organizers and for some of the
+directors, but like any other destructive agent, it may get out of hand.
+The War of 1914 was to last for six weeks. It dragged on for five years,
+and the wars that have grown out of it are still continuing. In the
+course of those five years, the war destroyed the capitalist system of
+continental Europe. Patches and shreds of it remained, but they were
+like the topless, shattered trees on the scarred battle-fields. They
+were remnants&mdash;nothing more. In the first place, the war destroyed the
+confidence of the people in the capitalist system; in the second place,
+it smashed up the political machinery of capitalism; in the third place,
+it weakened or destroyed the economic machinery of capitalism.</p>
+
+<p>Each government, to win the war, lied to its people. They were told that
+their country was invaded. They were assured that the war would be a
+short affair. Besides that, there were various reasons given for the
+struggle&mdash;it was a war to end war; it was a war to break the iron ring
+that was crushing a people; it was a war for liberty; it was a struggle
+to make the world safe for democracy.</p>
+
+<p>Not a single important promise of the war was fulfilled, save only the
+promise of victory. Hundreds of millions, aroused to the heights of an
+exalted idealism, came back to earth only to find themselves betrayed.
+With less promise and more fulfillment; with at least an appearance of
+statesmanship; with some respect for the simple moralities of
+truth-telling, fair-dealing, and common honor, there might have been
+some chance for the capitalist system to retain the confidence of the
+peoples of war-torn Europe, even in the face of the Russian Revolution;
+but each of these things was lacking, and as one worker put it: "I don't
+know what Bolshevism is, but it couldn't be any worse than what we have
+now, so I'm for it!"</p>
+
+<p>Such a loss of public confidence would have proved a serious blow to any
+social system, even were it capable of immediately re&euml;stablishing normal
+conditions of living<span class='pagenum'><a name="Page_248" id="Page_248">[Pg 248]</a></span> among the people. In this case, the same events
+that destroyed public confidence in the capitalist system, destroyed the
+system itself.</p>
+
+<p>The old political forms of Europe&mdash;the czars, emperors and kaisers, who
+stood as the visible symbols of established order and civilization, were
+overthrown during the war. The economic forces&mdash;the banks and business
+men&mdash;had used these forms for the promotion of their business
+enterprises. Capitalism depended on czars and kaisers as a blacksmith
+depends on his hammer. They were among the tools with which business
+forged the chains of its power. They were the political side of the
+capitalist system. While the people accepted them and believed in them,
+the business interests were able to use these political tools at will.
+The tools were destroyed in the fierce pressure of war and revolution,
+and with them went one of the chief assets of the European capitalists.</p>
+
+<p>There was a third breakdown&mdash;far more important than the break in the
+political machinery of the capitalist system&mdash;and that was the
+annihilation of the old economic life.</p>
+
+<p>Economic life is, in its elements, very simple. Raw materials&mdash;iron ore,
+copper, cotton, petroleum, coal and wheat&mdash;are converted, by some
+process of labor, into things that feed, clothe and house people. There
+are four stages in this process&mdash;raw materials; manufacturing;
+transportation; marketing. If there is a failure in one of the four, all
+of the rest go wrong, as is very clearly illustrated whenever there is a
+great miners' or railroad workers' strike, or when there is a failure of
+a particular crop. During the war, all four of these economic stages went wrong.</p>
+
+<p>Between the years 1914 and 1918 the people of Europe busied themselves
+with a war that put their economic machine out of the running.</p>
+
+<p>For a hundred years the European nations had been busy building a finely
+adjusted economic mechanism; population, finance, commerce&mdash;all were
+knit into the same system. This system the war demolished, and the years
+that have<span class='pagenum'><a name="Page_249" id="Page_249">[Pg 249]</a></span> followed the Armistice have not seen it rebuilt in any
+essential particular, save in Great Britain and in some of the neutral countries.</p>
+
+<p>Not only were the European nations unable to give commodities in
+exchange for the things they needed but the machinery of finance, by
+means of which these transactions were formerly facilitated, was
+crippled almost beyond repair. Under the old system buying and selling
+were carried on by the use of money, and money ceased to be a stable
+medium of exchange in Europe. It would be more correct to say that money
+was no longer taken seriously in many parts of Europe. During the war
+the European governments printed 75 billions of dollars' worth of paper
+money. This paper depreciated to a ridiculous extent. Before the war,
+the franc, the lira, the mark and the crown had about the same value&mdash;20
+to 23 cents, or about five to a dollar. By 1920 the dollar bought 15
+francs; 23 liras; 40 marks, and 250 Austrian crowns. In some of the
+ready-made countries, constituted under the Treaty or set up by the
+Allies as a cordon about Russia, hundreds and thousands of crowns could
+be had for a dollar. Even the pound sterling, which kept its value
+better than the money of any of the other European combatants, was
+thirty per cent. below par, when measured in terms of dollars. This
+situation made it impossible for the nations whose money was at such a
+heavy discount to purchase supplies from the more fortunate countries.
+But to make matters even worse, the rate of exchange fluctuated from day
+to day and from hour to hour so that business transactions could only be
+negotiated on an immense margin of safety.</p>
+
+<p>Add to this financial dissolution the mountains of debt, the huge
+interest charges and the oppressive taxes, and the picture of economic
+ruin is complete.</p>
+
+<p>The old capitalist world, organized on the theory of competition between
+the business men within each nation, and between the business men of one
+nation and those of another nation, reached a point where it would no longer work.</p>
+
+<p><span class='pagenum'><a name="Page_250" id="Page_250">[Pg 250]</a></span></p><p>In Russia the old system had disappeared, and a new system had been set
+up in its place. In Germany, and throughout central Europe, the old
+system was shattered, and the new had not yet emerged. In France, Italy
+and Great Britain the old system was in process of disintegration&mdash;rapid
+in France and Italy; slower in Great Britain. But in all of these
+countries intelligent men and women were asking the only question that
+statesmanship could ask&mdash;the question, "What next?"</p>
+
+<p>The capitalist system was stronger in Great Britain than in any of the
+other warring countries of Europe. Before the war, it rested on a surer
+foundation. During the war, it withstood better than any other the
+financial and industrial demands. Since the war, it has made the best recovery.</p>
+
+<p>Great Britain is the most successful of the capitalist states. The other
+capitalist nations of Europe regard her as the inner citadel of European
+capitalism. The British Labor Movement is seeking to take this citadel from within.</p>
+
+<p>The British Labor Movement is a formidable affair. There are not more
+than a hundred thousand members in all of the Socialist parties, in the
+Independent Labor Party and in the Communist Party combined. There are
+between six and seven millions of members in the trade unions.</p>
+
+<p>Perhaps the best test of the strength of the British Labor Movement came
+in the summer of 1920, over the prospective war with Russia. Warsaw was
+threatened. Its fall seemed imminent, and both Millerand and
+Lloyd-George made it clear that the fall of Warsaw meant war. The
+situation developed with extraordinary rapidity. It was reported that
+the British Government had dispatched an ultimatum. The Labor Movement
+acted with a strength and precision that swept the Government off its
+feet and compelled an immediate reversal of policy.</p>
+
+<p>Over night, the workers of Great Britain were united in the Council of
+Action. As originally constituted, the "Labor and Russia Council of
+Action" consisted of five<span class='pagenum'><a name="Page_251" id="Page_251">[Pg 251]</a></span> representatives each from the Parliamentary
+Committee of the Trades Union Congress, the Executive Committee of the
+Labor Party and the Parliamentary Labor Party. To these fifteen were
+added eight others, among whom were representatives of every element in
+the British Labor Movement. This Council of Action did three things&mdash;it
+notified the Government that there must be no war with Russia; it
+organized meetings and demonstrations in every corner of the United
+Kingdom to formulate public opinion; it began the organization of local
+councils of action, of which there were three hundred within four weeks.
+The Council of Action also called a special conference of the British
+Labor Movement which met in London on August 13. There were over a
+thousand delegates at this conference, which opened and closed with the
+singing of the "Internationale." When the principal resolution of
+endorsement was passed, approving the formation of the Council of
+Action, the delegates rose to their feet, cheered the move to the echo,
+and sang the "Internationale" and "The Red Flag." The closing resolution
+authorized the Council of Action to take "any steps that may be
+necessary to give effect to the decisions of the Conference and the
+declared policy of the Trade Union and Labor Movement."</p>
+
+<p>Such was the position in the "Citadel of European Capitalism." The
+Government was forced to deal with a body that, for all practical
+purposes, was determining the foreign policy of the Empire. Behind that
+Council was an organized group of between six and seven millions of
+workers who were out to get the control of industry into their own
+hands, and to do it as speedily and as effectually as circumstances
+would permit.</p>
+
+<p>Meanwhile, the mantle of revolutionary activity descended upon Italy,
+where the red flag was run up over some the largest factories and some
+of the finest estates.</p>
+
+<p>Throughout the war, the revolutionary movement was strong in Italy. The
+Socialist Party remained consistently an anti-war party, with a radical
+and vigorous propaganda. The Armistice found the Socialist and Labor
+Movements<span class='pagenum'><a name="Page_252" id="Page_252">[Pg 252]</a></span> strong in the North, with a growing movement in the South for
+the organization of Agricultural Leagues.</p>
+
+<p>The Socialist propaganda in Italy was very consistent and telling. The
+paper "Avanti," circulating in all parts of the country, was an agency
+of immense importance. The war, the Treaty, the rising cost of living,
+the growing taxation&mdash;all had prepared the ground for the work that the
+propagandists were doing. Their message was: "Make ready for the taking
+over of the industries! Learn what you can, so that, when the day comes,
+each will play his part. When you get the word, take over the works!
+There must be no violence&mdash;that only helps the other side. Do not linger
+on the streets, you will be shot. Remain at home or stay in the
+factories and work as you never worked before!"</p>
+
+<p>That, in essence, was the Italian Socialist propaganda&mdash;simple, clear
+and direct, and that was, in effect, what the workers did.</p>
+
+<p>The returned soldiers were a factor of large importance in the Italian
+Revolution. They were radicals throughout the war. The peace made them
+revolutionists. "The Proletarian League of the Great War" was affiliated
+with "The International of Former Soldiers," which comprised the radical
+elements among the ex-service men of Great Britain, Germany, France,
+Austria, Italy and a number of the smaller countries. There were over a
+million dues-paying members in this International, and their avowed
+object was propaganda against war and in favor of an economic system in
+which the workers control the industries. It was this group in
+Italy&mdash;particularly in the South&mdash;that carried through the project of
+occupying the estates.</p>
+
+<p>The workers are in control of the whole social fabric in Russia where
+the revolution has gone the farthest. In Great Britain, where the labor
+movement is perhaps more conservative than in any of the other countries
+of Europe, the Government is compelled to deal with a labor movement
+that is strong enough to consider and to decide <span class='pagenum'><a name="Page_253" id="Page_253">[Pg 253]</a></span>important matters of
+foreign policy. The workers of Italy have the upper hand. In
+Czecho-Slovakia, in Bulgaria, in Germany and in the smaller and neutral
+countries the workers are making their voices heard in opposition to any
+restoration of the capitalist system; while they busy themselves with
+the task of creating the framework of a new society.</p>
+
+<h3>4. <i>The Challenge</i></h3>
+
+<p>This is the challenge of the workers of Europe to the capitalist system.
+The workers are not satisfied; they are questioning. They mean to have
+the best that life has to give, and they are convinced that the
+capitalist system has denied it to them.</p>
+
+<p>The world has had more than a century of capitalism. The workers have
+had ample opportunity to see the system at work. The people of all the
+great capitalist countries&mdash;the common people&mdash;have borne the burdens
+and felt the crushing weight of capitalism&mdash;in its enslavement of little
+children; in its underpaying of women; in long hours of unremitting,
+monotonous toil; in the dreadful housing; in the starvation wages; in
+unemployment; in misery. The capitalist system has had a trial and it is
+upon the workers that the system has been tried out.</p>
+
+<p>During this experiment, the workers of the world have been compelled to
+accept poverty, unemployment and war.</p>
+
+<p>These terrible scourges have afflicted the capitalist world, and it is
+the workers and their families that have borne them in their own
+persons. In those countries where the capitalist system is the oldest,
+the workers have suffered the longest. The essence of capitalism is the
+exploitation of one man by another man, and the longer this exploitation
+is practiced the more skillful and effective does the master class
+become in its manipulation.</p>
+
+<p>The workers look before them along the path of capitalist imperialism
+that is now being followed by the nations that are in the lead of the
+capitalist world. There<span class='pagenum'><a name="Page_254" id="Page_254">[Pg 254]</a></span> they see no promise save the same exploitation,
+the same poverty, the same inequality and the same wars over the
+commercial rivalries of the imperial nations.</p>
+
+<p>The workers of Europe have come to the conclusion that the world should
+belong to those who build it; that the good things of life should be the
+property of those who produce them. They see only one course open before
+them&mdash;to declare that those who will not work, shall not eat.</p>
+
+<p>The right of self-determination is the international expression of this
+challenge. The ownership of the job is its industrial equivalent.
+Together, the two ideas comprise the program of the more advanced
+workers in all of the great imperial countries of the world. These ideas
+did not originate in Russia, and they are not confined to Russia any
+more than capitalism is confined to Great Britain. They are the
+doctrines of the new order that is coming rapidly into its own.</p>
+
+<p>Capitalism has been summed up, heretofore, in the one word "profit." The
+capitalist cannot abandon that standard. The world has lived beyond it,
+however, and without it, capitalism, as a system, is meaningless. If the
+capitalists abandon profit, they abandon capitalism.</p>
+
+<p>Without profit the capitalist system falls to pieces, because it is the
+profit incentive that has always been considered as the binder that
+holds the capitalist world together. Hence the abandonment of the profit
+incentive is the surrender of the citadel of capitalism. While profit
+remains, exploitation persists, and while there is exploitation of one
+man by another, no human being can call himself free.</p>
+
+<p>The capitalists are caught in a beleaguered fortress in which they are
+defending their economic lives. Profit is the key to this fortress, and
+if they surrender the key, they are lost.</p>
+
+<h3>5. <i>The Real Struggle</i></h3>
+
+<p>This is the real struggle for the possession of the earth. Shall the few
+own and the many labor for the few, or the many own, and labor upon jobs
+that they themselves <span class='pagenum'><a name="Page_255" id="Page_255">[Pg 255]</a></span>possess? The struggle between the capitalist
+nations is incidental. The struggle between the owners of the world and
+the workers of the world is fundamental.</p>
+
+<p>If Great Britain wins in her conflict with the United States, her
+capitalists will continue to exploit the workers of Lancashire and
+Delhi. Her imperialists will continue their policy of world domination,
+subjugating peoples and utilizing their resources and their labor for the enrichment.</p>
+
+<p>If the United States wins in her struggle with Great of the bankers and
+traders of London. Britain, her capitalists will continue to exploit the
+workers of Pittsburg and San Juan. Her imperialists will continue their
+policy of world domination, subjugating the peoples of Latin American
+first, and then reaching out for the control over other parts of the earth.</p>
+
+<p>No matter what imperial nation may triumph in this struggle between the
+great nations for the right to exploit the weaker peoples and the choice
+resources, the struggle between capitalism and Socialism must be fought
+to a finish. If the capitalists win, the world will see the introduction
+of a new form of serfdom, more complete and more effective than the
+serfdom of Feudal Europe. If the Socialists win, the world enters upon a
+new cycle of development.</p>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_256" id="Page_256">[Pg 256]</a></span></p>
+
+<h2><a name="XIX_THE_AMERICAN_WORKER_AND_WORLD_EMPIRE" id="XIX_THE_AMERICAN_WORKER_AND_WORLD_EMPIRE"></a>XIX. THE AMERICAN WORKER AND WORLD EMPIRE</h2>
+
+<h3>1. <i>Gains and Losses</i></h3>
+
+<p>The American worker is a citizen of the richest country of the world.
+Resources are abundant. There is ample machinery to convert these gifts
+of nature into the things that men need for their food and clothing,
+their shelter, their education and their recreation. There is enough for
+all, and to spare, in the United States.</p>
+
+<p>But the American worker is not master of his own destinies. He must go
+to the owners of American capital&mdash;to the plutocrats&mdash;and from them he
+must secure the permission to earn a living; he must get a job.
+Therefore it is the capitalists and not the workers of the United States
+that are deciding its public policy at the present moment.</p>
+
+<p>The American capitalist is a member of one of the most powerful
+exploiting groups in the world. Behind him are the resources, productive
+machinery and surplus of the American Empire. Before him are the
+undeveloped resources of the backward countries. He has gained wealth
+and power by exploitation at home. He is destined to grow still richer
+and more powerful as he extends his organization for the purposes of
+exploitation abroad.</p>
+
+<p>The prospects of world empire are as alluring to the American capitalist
+as have been similar prospects to other exploiting classes throughout
+history. Empire has always been meat and drink to the rulers.</p>
+
+<p>The master class has much to gain through imperialism. The workers have
+even more to lose.</p>
+
+<p>The workers make up the great bulk of the American people. Fully
+seven-eighths (perhaps nine-tenths) of the adult inhabitants of the
+United States are wage earners,<span class='pagenum'><a name="Page_257" id="Page_257">[Pg 257]</a></span> clerks and working farmers. All of the
+proprietors, officials, managers, directors, merchants (big and little),
+lawyers, doctors, preachers, teachers, and the remainder of the business
+and professional classes constitute not over 10 or 12 percent of the
+total adult population. The workers are the "plain people" who do not
+build empires any more than they make wars. If they were left to
+themselves, they would continue the pursuit of their daily affairs which
+takes most of their thought and energy&mdash;and be content to let their
+neighbors alone.</p>
+
+<h3>2. <i>The Workers' Business</i></h3>
+
+<p>The mere fact that the workers are so busy with the routine of daily
+life is in itself a guarantee that they will mind their own business.
+The average worker is engaged, outside of working hours, with the duties
+of a family. His wife, if she has children, is thus employed for the
+greater portion of her time. Both are far too preoccupied to interfere
+with the like acts of other workers in some other portion of the world.
+Furthermore, their preoccupation with these necessary tasks gives them
+sympathy with those similarly at work elsewhere.</p>
+
+<p>The plain people of any country are ready to exercise even more than an
+ordinary amount of forbearance and patience rather than to be involved
+in warfare, which wipes out in a fortnight the advantages gained through
+years of patient industry.</p>
+
+<p>The workers have no more to gain from empire building than they have
+from war making, but they pay the price of both. Empire building and war
+making are Siamese twins. They are so intimately bound together that
+they cannot live apart. The empire builder&mdash;engaged in conquering and
+appropriating territory and in subjugating peoples&mdash;must have not only
+the force necessary to set up the empire, but also the force requisite
+to maintain it. Battleships and army corps are as essential to empires
+as<span class='pagenum'><a name="Page_258" id="Page_258">[Pg 258]</a></span> mortar is to a brick wall. They are the expression of the organized
+might by which the empire is held together.</p>
+
+<p>The plain people are the bricks which the imperial class uses to build
+into a wall about the empire. They are the mortar also, for they man the
+ships and fill up the gaps in the infantry ranks and the losses in the
+machine gun corps. They are the body of the empire as the rulers are its guiding spirit.</p>
+
+<p>When ships are required to carry the surplus wealth of the ruling class
+into foreign markets, the workers build them. When surplus is needed to
+be utilized in taking advantage of some particularly attractive
+investment opportunity the workers create it. They lay down the keels of
+the fighting ships, and their sons aim and fire the guns. They are
+drafted into the army in time of war and their bodies are fed to the
+cannon which other workers in other countries, or perhaps in the same
+country, have made for just such purposes. The workers are the warp and
+woof of empire, yet they are not the gainers by it. Quite the contrary,
+they are merely the means by which their masters extend their dominion
+over other workers who have not yet been scientifically exploited.</p>
+
+<p>The work of empire building falls to the lot of the workers. The profits
+of empire building go to the exploiting class.</p>
+
+<h3>3. <i>The British Workers</i></h3>
+
+<p>What advantage came to the workers of Rome from the Empire which their
+hands shaped and which their blood cemented together? Their masters took
+their farms, converted the small fields into great, slave-worked
+estates, and drove the husbandmen into the alleys and tenements of the
+city where they might eke out an existence as best they could. The
+rank-and-file Roman derived the same advantage from the Roman Empire
+that the rank-and-file Briton has derived from the British Empire.</p>
+
+<p><span class='pagenum'><a name="Page_259" id="Page_259">[Pg 259]</a></span></p><p>Great Britain has exercised more world mastery during the past hundred
+years than any other nation. All that Germany hoped to achieve Great
+Britain has realized. Her traders carry the world's commerce, her
+financiers clip profits from international business transactions, her
+manufacturers sell to the people of every country, the sun never sets on the British flag.</p>
+
+<p>Great Britain is the foremost exponent and practitioner of capitalist
+imperialism. The British Empire is the greatest that the world has known
+since the Empire of Rome fell to pieces. Whatever benefits modern
+imperialism brings either for capitalists or for workers should be
+enjoyed by the capitalists and workers of Great Britain.</p>
+
+<p>Until the Great World War the capitalists of Great Britain were the most
+powerful on earth with a larger foreign trade and a larger foreign
+investment than any other. At the same time the British workers were
+amongst the worst exploited of those in any capitalist country in Europe.</p>
+
+<p>The entire nineteenth century is one long and terrible record of
+master-class exploitation inside the British Isles. The miseries of
+modern India have been paralleled in the lives of the workers of
+Ireland, Scotland, Wales and England. Gibbins, in his description of the
+conditions of the child workers in the early years of the nineteenth
+century ends with the remark, "One dares not trust oneself to try and
+set down calmly all that might be told of this awful page of the history
+of industrial England."<a name="FNanchor_58_58" id="FNanchor_58_58"></a><a href="#Footnote_58_58" class="fnanchor">[58]</a></p>
+
+<p>Even more revolting are the descriptions of the conditions which
+surrounded the lives of the mine workers in the early part of the
+nineteenth century. Women as well as men were taken into the mines and
+in some cases, as the reports of the Parliamentary investigation show,
+the women dragged cars through passage-ways that were too low to admit
+the use of ponies or mules.</p>
+
+<p><span class='pagenum'><a name="Page_260" id="Page_260">[Pg 260]</a></span></p><p>England, mistress of the seas, proud carrier of the traffic of the
+world, the center of international finance, the richest among all the
+investing nations&mdash;England was reeking with poverty. Beside her
+factories and warehouses were vile slums in which people huddled as
+Ruskin said, "so many brace to a garret." There in the back alleys of
+civilization babies were born and babies died, while those who survived
+grew to the impotent manhood of the street hooligan.</p>
+
+<p>The British Empire girdled the world. For a century its power had grown,
+practically unchallenged. Superficially it had every appearance of
+strength and permanence but behind it and beneath it were the hundreds
+of thousands of exploited factory workers, the underpaid miners, the
+Cannon Gate of Edinburgh and the Waterloo Junction of London.</p>
+
+<p>Capitalist imperialism has not benefited the British workers. Quite the
+contrary, the rise of the Empire has been accompanied by the
+disappearance of the stalwart English yeoman; by the disappearance of
+the agricultural population; by the concentration of the people in huge
+industrial towns where the workers, no longer the masters of their own
+destinies, must earn their living by working at machines owned by the
+capitalist imperialists. The surplus derived from this exploited labor
+is utilized by the capitalists as the means of further extending their
+power in foreign lands.</p>
+
+<p>Imperialism has brought not prosperity, but poverty to the plain people of England.</p>
+
+<p>There is another aspect of the matter. If these degraded conditions
+attach to the workers in the center of the empire, what must be the
+situation among the workers in the dependencies that are the objects of
+imperial exploitation? Let the workers of India answer for Great
+Britain; the workers of Korea answer for Japan, and the workers of Porto
+Rico answer for the United States. Their lot is worse than is the lot of
+the workers at the center of imperial power.</p>
+
+<p><span class='pagenum'><a name="Page_261" id="Page_261">[Pg 261]</a></span></p><p>Empires yield profits to the masters and victory and glory to the
+workers. Let any one who does not believe this compare the lives of the
+workers in small countries like Holland, Norway, Denmark and
+Switzerland, with the lives of the workers in the neighboring
+empires&mdash;Russia, Germany, France and Great Britain. The advantage is all
+on the side of those who live in the smaller countries that are minding
+their own affairs and letting their neighbors alone.</p>
+
+<h3>4. <i>The Long Trail</i></h3>
+
+<p>The workers of the United States are to-day following the lead of the
+most powerful group of financial imperialists in the world. The trail is
+a long one leading to world conquest, unimagined dizzying heights of
+world power, riches beyond the ken of the present generation, and then,
+the slow and terrible decay and dissolution that sooner or later
+overtake those peoples that follow the paths of empire. The rulers will
+wield the power and enjoy the riches. The people will struggle and
+suffer and pay the price.</p>
+
+<p>The American plutocracy is out to conquer the earth because it is to
+their interest to do so. The will-o'-the-wisp of world empire has
+captured their imaginations and they are following it blindly.</p>
+
+<p>The American people, on November 2, 1920, gave the American imperialists
+a blanket authority to go about their imperial business&mdash;an authority
+that the rulers will not be slow to follow. First they will clean house
+at home&mdash;that housecleaning will be called "the campaign for the
+establishment of the open shop." Then they will go into Mexico, Central
+America, China, and Europe in search of markets, trade and investment opportunities.</p>
+
+<p>Behind the investment will come the flag, carried by battle-ships and
+army divisions. That flag will be brought front to front with other
+flags, high words will be spoken, blood will flow, life will ebb, and
+the imperialists will win their point and pocket their profit.</p>
+
+<p><span class='pagenum'><a name="Page_262" id="Page_262">[Pg 262]</a></span></p><p>Behind them, in November, and at all other times of the year, there
+will be the will, expressed or implied, of the working people of the
+United States, who will produce the surplus for foreign investment; will
+make the ships and man them; will dig the coal and bore for the oil;
+will shape the machines. Their hands and the hands of their sons will be
+the force upon which the ruling class must depend for its power. They
+will produce, while the ruling class consumes and destroys.</p>
+
+<p>The trail is a long one, but it leads none the less certainly to,
+isolation and death. No people can follow the imperial trail and live.
+Their liberties go first and then their lives pay the penalty of their
+rulers' imperial ambition. It was so in the German Empire. It is so
+to-day in the British Empire. To-morrow, if the present course is
+followed, it will be equally true in the American Empire.</p>
+
+<h3>5. <i>The New Germany</i></h3>
+
+<p>One of the chief charges against the Germans, in 1914, was that they
+were not willing to leave their neighbors in peace. They were out to
+conquer the world, and they did not care who knew it. It was not the
+German people who held these plans for world conquest, it was the German
+ruling class. The German people were quite willing to stay at home and
+attend to their own affairs. Their rulers, pushed by the need for
+markets and investment opportunities, and lured by the possibilities of
+a world empire, were willing to stake the lives and the happiness of the
+whole nation on the outcome of these ambitious schemes. They threw their
+dice in the great world game of international rivalries&mdash;threw and lost;
+but in their losing, they carried not only their own fortunes, but the
+lives and the homes and the happiness of millions of their fellows whose
+only desire was to remain at home and at peace.</p>
+
+<p>Germany's offense was her ambition to gain at the expense of her
+neighbors. Lacking a place in the sun, she proposed to take it by the
+strength of her good right arm.<span class='pagenum'><a name="Page_263" id="Page_263">[Pg 263]</a></span> This is the method by which all of the
+great empires have been built and it is the method that the builders of
+the American Empire have followed up to this point. The land which the
+ruling class of the United States has needed has heretofore been in the
+hands of weak peoples&mdash;Indians, Mexicans, a broken Spanish Empire. Now,
+however, the time has come when the rulers of the United States, with
+the greatest wealth and the greatest available resources of any of the
+nations, are preparing to take what they want from the great nations,
+and that imperial purpose can be enforced in only one way&mdash;by a resort
+to arms. The rulers of the United States must take what they would have
+by force, from those who now possess it. They did not hesitate to take
+Panama from Colombia; they did not hesitate to take possession of Hayti
+and of Santo Domingo, and they do not propose to stop there.</p>
+
+<p>The people of the world know these things. The inhabitants of Latin
+America know them by bitter experience. The inhabitants of Europe and of
+Asia know them by hearsay. Both in the West and in the East, the United
+States is known as "The New Germany."</p>
+
+<p>That means that the peoples of these countries look upon the United
+States and her foreign policies in exactly the same way that the people
+of the United States were taught to regard Germany and her foreign
+policies. To them the United States is a great, rich, brutal Empire,
+setting her heel and laying her fist where necessity calls. Men and
+women inside the United States think of themselves and of their fellow
+citizens as human beings. The people in the other countries read the
+records of the lynchings, the robberies and the murders inside the
+United States; of the imperial aggression toward Latin America, and they
+are learning to believe that the United States is made up of ruthless
+conquerors who work their will on those that cross their path.</p>
+
+<p>The plain American men and women, living quietly in their simple homes,
+are none the less citizens of an aggressive, conquering Empire. They may
+not have a<span class='pagenum'><a name="Page_264" id="Page_264">[Pg 264]</a></span> thought directed against the well-being of a single human
+creature, but they pay their taxes into the public treasury; they vote
+for imperialism on each election day; they read imperialism in their
+papers and hear it preached in their churches, and when the call comes,
+their sons will go to the front and shed their blood in the interest of
+the imperial class.</p>
+
+<p>The plain people of the German Empire did not desire to harm their
+fellows, nevertheless, they furnished the cannon-fodder for the Great
+War. America's plain folks, by merely following the doctrine, "My
+country, right or wrong&mdash;America first!" will find themselves, at no
+very distant date, exactly where the German people found themselves in
+1914.</p>
+
+<h3>6. <i>The Price</i></h3>
+
+<p>The historic record, in the matter of empire, is uniform. The masters
+gain; the workers pay.</p>
+
+<p>The workers of the United States will not be exempt from these
+inexorable necessities of imperialism. On the contrary they will be
+called upon to pay the same price for empire that the workers in Britain
+have paid; that the workers in the other empires have paid. What is the
+price? What will world empire cost the American workers?</p>
+
+<p>1. It will cost them their liberties. An empire cannot be run by a
+debating society. Empires must act. In order to make this action mobile
+and efficacious, authority must be centered in the hands of a small
+group&mdash;the ruling class, whose will shall determine imperial policy.
+Self-government is inconsistent with imperialism.</p>
+
+<p>2. The workers will not only lose their own liberties, but they will be
+compelled to take liberties away from the peoples that are brought under
+the domination of the Empire. Self-determination is the direct opposite
+of imperialism.</p>
+
+<p>3. The American workers, as a part of the price of empire, will be
+compelled to produce surplus <span class='pagenum'><a name="Page_265" id="Page_265">[Pg 265]</a></span>wealth&mdash;wealth which they can never
+consume; wealth the control of which passes into the hands of the
+imperial ruling class, to be invested by them in the organization of the
+Empire and the exploitation of the resources and other economic
+opportunities of the dependent territory.</p>
+
+<p>4. The American workers must be prepared to create and maintain an
+imperial class, whose function it is to determine the policies and
+direct the activities of the Empire. This class owes its existence to
+the existence of empire, without which such a ruling class would be
+wholly unnecessary.</p>
+
+<p>5. The American workers must be prepared, in peace time as well as in
+war time, to provide the "sinews of war": the fortifications, the battle
+fleet, the standing army and the vast naval and military equipment that
+invariably accompany empire.</p>
+
+<p>6. The American workers must furthermore be ready, at a moment's call,
+to turn from their occupations, drop their useful pursuits, accept
+service in the army or in the navy and fight for the preservation of the
+Empire&mdash;against those who attack from without, against those who seek
+the right of self-determination within.</p>
+
+<p>7. The American workers, in return for these sacrifices, must be
+prepared to accept the poverty of a subsistence wage; to give the best
+of their energies in war and in peace, and to stand aside while the
+imperial class enjoys the fat of the land.</p>
+
+<h3>7. <i>A Way Out</i></h3>
+
+<p>If the United States follows the course of empire, the workers of the
+United States have no choice but to pay the price of Empire&mdash;pay it in
+wealth, in misery, and in blood. But there is an alternative. Instead of
+going on with the old system of the masters, the workers may establish a
+new economic system&mdash;a system belonging to the workers, and managed by
+them for their benefit.</p>
+
+<p><span class='pagenum'><a name="Page_266" id="Page_266">[Pg 266]</a></span></p><p>The workers of Europe have tried out imperialism and they have come to
+the conclusion that the cost is too high. Now they are seeking, through
+their own movement&mdash;the labor movement&mdash;to control and direct the
+economic life of Europe in the interest of those who produce the wealth
+and thus make the economic life of Europe possible.</p>
+
+<p>The American workers have the same opportunity. Will they avail
+themselves of it? The choice is in their hands.</p>
+
+<p>Thus far the workers of the United States have been, for the most part,
+content to live under the old system, so long as it paid them a living
+wage and offered them a job. The European workers felt that too in the
+pre-war days, but they have been compelled&mdash;by the terrible experiences
+of the past few years&mdash;to change their minds. It was no longer a
+question of wages or a job in Europe. It was a question of life or
+death.</p>
+
+<p>Can the American worker profit by that experience? Can he realize that
+he is living in a country whose rulers have adopted an imperial policy
+that threatens the peace of the world? Can he see that the pursuit of
+this policy means war, famine, disease, misery and death to millions in
+other countries as well as to the millions at home? The workers of
+Europe have learned the lesson by bitter experience. Is not the American
+worker wise enough to profit by their example?</p>
+
+
+<div class="footnotes"><h3>FOOTNOTE:</h3>
+
+<div class="footnote"><p><a name="Footnote_58_58" id="Footnote_58_58"></a><a href="#FNanchor_58_58"><span class="label">[58]</span></a> "Industry in England," H. deB. Gibbins. New York,
+Scribner's, 1897, p. 390.</p></div></div>
+
+<p class="tbrk">&nbsp;</p>
+
+<h4>THE END</h4>
+
+<hr />
+<h2><a name="INDEX" id="INDEX"></a>INDEX.</h2>
+
+<div class="index2">
+<ul>
+	<li>
+	<ul>
+		<li>Advertising imperialism,&nbsp;
+		<ul>
+			<li><a href="#Page_169">169</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>America, conquest of,&nbsp;
+		<ul>
+			<li><a href="#Page_27">27</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>America first,&nbsp;
+		<ul>
+			<li><a href="#Page_170">170</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>America for Americans,&nbsp;
+		<ul>
+			<li><a href="#Page_202">202</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>American capitalists,&nbsp;
+		<ul>
+			<li><a href="#Page_218">218</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
+"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; program of,&nbsp;
+			<ul>
+				<li><a href="#Page_226">226</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; empire, costs of,&nbsp;
+			<ul>
+				<li><a href="#Page_160">160</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
+"&nbsp; &nbsp; &nbsp; course of,&nbsp;
+			<ul>
+				<li><a href="#Page_158">158</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
+"&nbsp; &nbsp; &nbsp; development of,&nbsp;
+			<ul>
+				<li><a href="#Page_15">15</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
+"&nbsp; &nbsp; &nbsp; economic basis of,&nbsp;
+			<ul>
+				<li><a href="#Page_74">74</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
+"&nbsp; &nbsp; &nbsp; growth of,&nbsp;
+			<ul>
+				<li><a href="#Page_161">161</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; imperialism,&nbsp;
+			<ul>
+				<li><a href="#Page_23">23</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; Indian,&nbsp;
+			<ul>
+				<li><a href="#Page_29">29</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; industries, growth of,&nbsp;
+			<ul>
+				<li><a href="#Page_178">178</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; people, ancestry,&nbsp;
+			<ul>
+				<li><a href="#Page_159">159</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; protectorates,&nbsp;
+			<ul>
+				<li><a href="#Page_207">207</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; Republic, disappearance of,&nbsp;
+			<ul>
+				<li><a href="#Page_72">72</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; tradition, failure of,&nbsp;
+			<ul>
+				<li><a href="#Page_12">12</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; worker and empire,&nbsp;
+			<ul>
+				<li><a href="#Page_256">256</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Anti-imperialism,&nbsp;
+		<ul>
+			<li><a href="#Page_68">68</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Appropriation of territory,&nbsp;
+		<ul>
+			<li><a href="#Page_213">213</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Automobile distribution,&nbsp;
+		<ul>
+			<li><a href="#Page_183">183</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Bankers, unity of,&nbsp;
+		<ul>
+			<li><a href="#Page_150">150</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Bethlehem Steel Co.,&nbsp;
+		<ul>
+			<li><a href="#Page_132">132</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>British Empire, gains of,&nbsp;
+		<ul>
+			<li><a href="#Page_198">198</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp;
+"&nbsp; &nbsp; &nbsp; position of,&nbsp;
+			<ul>
+				<li><a href="#Page_234">234</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; Labor, position of,&nbsp;
+			<ul>
+				<li><a href="#Page_250">250</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Business control,&nbsp;
+		<ul>
+			<li><a href="#Page_148">148</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Canada, investments in,&nbsp;
+		<ul>
+			<li><a href="#Page_206">206</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Capitalism and Bolshevism,&nbsp;
+		<ul>
+			<li><a href="#Page_244">244</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
+"&nbsp; &nbsp;war,&nbsp;
+			<ul>
+				<li><a href="#Page_225">225</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;breakdown of,&nbsp;
+			<ul>
+				<li><a href="#Page_248">248</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;law of,&nbsp;
+			<ul>
+				<li><a href="#Page_223">223</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Cherokees, dealings with,&nbsp;
+		<ul>
+			<li><a href="#Page_33">33</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Class government,&nbsp;
+		<ul>
+			<li><a href="#Page_10">10</a></li>
+			<li class="subitem">"&nbsp; struggle, in Europe,&nbsp;
+			<ul>
+				<li><a href="#Page_254">254</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Coal reserves,&nbsp;
+		<ul>
+			<li><a href="#Page_180">180</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Cohesion of wealth,&nbsp;
+		<ul>
+			<li><a href="#Page_86">86</a>,&nbsp;</li>
+			<li><a href="#Page_118">118</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Competition, ferocity of,&nbsp;
+		<ul>
+			<li><a href="#Page_223">223</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Competitive industry,&nbsp;
+		<ul>
+			<li><a href="#Page_75">75</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Conquering peoples,&nbsp;
+		<ul>
+			<li><a href="#Page_26">26</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Conquest of the West,&nbsp;
+		<ul>
+			<li><a href="#Page_49">49</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Council of Action, organization,&nbsp;
+		<ul>
+			<li><a href="#Page_250">250</a></li>
+			<li class="subitem">" &nbsp; &nbsp;
+"&nbsp; &nbsp;National Defense,&nbsp;
+			<ul>
+				<li><a href="#Page_148">148</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Cuban, independence,&nbsp;
+		<ul>
+			<li><a href="#Page_66">66</a></li>
+			<li class="subitem">" &nbsp; &nbsp; treaty,&nbsp;
+			<ul>
+				<li><a href="#Page_208">208</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Dictatorship, possibility of,&nbsp;
+		<ul>
+			<li><a href="#Page_222">222</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Dominican Republic, relations with,&nbsp;
+		<ul>
+			<li><a href="#Page_209">209</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Education for imperialism,&nbsp;
+		<ul>
+			<li><a href="#Page_169">169</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Empire and British workers,&nbsp;
+		<ul>
+			<li><a href="#Page_258">258</a></li>
+			<li class="subitem">"&nbsp; &nbsp; characteristics of,&nbsp;
+			<ul>
+				<li><a href="#Page_15">15</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; definition of,&nbsp;
+			<ul>
+				<li><a href="#Page_16">16</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; evolution of,&nbsp;
+			<ul>
+				<li><a href="#Page_22">22</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; prevalence of,&nbsp;
+			<ul>
+				<li><a href="#Page_17">17</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; price of,&nbsp;
+			<ul>
+				<li><a href="#Page_20">20</a>,&nbsp;</li>
+				<li><a href="#Page_264">264</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; stages in,&nbsp;
+			<ul>
+				<li><a href="#Page_19">19</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; workers and,&nbsp;
+			<ul>
+				<li><a href="#Page_262">262</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Empires, the Big Four,&nbsp;
+		<ul>
+			<li><a href="#Page_231">231</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Europe, financial breakdown,&nbsp;
+		<ul>
+			<li><a href="#Page_249">249</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; revolution in,&nbsp;
+			<ul>
+				<li><a href="#Page_246">246</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Financial imperialism,&nbsp;
+		<ul>
+			<li><a href="#Page_135">135</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Foreign investments,&nbsp;
+		<ul>
+			<li><a href="#Page_131">131</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>France, gains of,&nbsp;
+		<ul>
+			<li><a href="#Page_197">197</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Government and business,&nbsp;
+		<ul>
+			<li><a href="#Page_99">99</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Great Peace,&nbsp;
+		<ul>
+			<li><a href="#Page_36">36</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Great War,&nbsp;
+		<ul>
+			<li><a href="#Page_143">143</a></li>
+			<li class="subitem">"&nbsp; &nbsp; "&nbsp; &nbsp; &nbsp; advantages of, to the United States,&nbsp;
+			<ul>
+				<li><a href="#Page_157">157</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; "&nbsp; &nbsp; &nbsp; next incidents of,&nbsp;
+			<ul>
+				<li><a href="#Page_235">235</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; "&nbsp; &nbsp; &nbsp; results of,&nbsp;
+			<ul>
+				<li><a href="#Page_240">240</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Guaranty Trust Company,&nbsp;
+		<ul>
+			<li><a href="#Page_136">136</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Hawaii, annexation of,&nbsp;
+		<ul>
+			<li><a href="#Page_62">62</a></li>
+			<li class="subitem">"&nbsp; &nbsp; revolution in,&nbsp;
+			<ul>
+				<li><a href="#Page_63">63</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Hayti, conditions in,&nbsp;
+		<ul>
+			<li><a href="#Page_210">210</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Immigrants, race of,&nbsp;
+		<ul>
+			<li><a href="#Page_160">160</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Imperial alignment,&nbsp;
+		<ul>
+			<li><a href="#Page_229">229</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp;goal,&nbsp;
+			<ul>
+				<li><a href="#Page_222">222</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp;purpose,&nbsp;
+			<ul>
+				<li><a href="#Page_165">165</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp;sentiments,&nbsp;
+			<ul>
+				<li><a href="#Page_166">166</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp;task,&nbsp;
+			<ul>
+				<li><a href="#Page_237">237</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; "&nbsp; &nbsp; nature of,&nbsp;
+			<ul>
+				<li><a href="#Page_228">228</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Imperialism, advantages of,&nbsp;
+		<ul>
+			<li><a href="#Page_256">256</a></li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp;&nbsp; &nbsp; beginnings of,&nbsp;
+			<ul>
+				<li><a href="#Page_65">65</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp;&nbsp; &nbsp; challenge to,&nbsp;
+			<ul>
+				<li><a href="#Page_243">243</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp;&nbsp; &nbsp; cost of,&nbsp;
+			<ul>
+				<li><a href="#Page_261">261</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp;&nbsp; &nbsp; establishment of,&nbsp;
+			<ul>
+				<li><a href="#Page_72">72</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp;&nbsp; &nbsp; failure of,&nbsp;
+			<ul>
+				<li><a href="#Page_243">243</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp;&nbsp; &nbsp; psychology of,&nbsp;
+			<ul>
+				<li><a href="#Page_170">170</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Imperialists, training of,&nbsp;
+		<ul>
+			<li><a href="#Page_219">219</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Incomes, in the United States,&nbsp;
+		<ul>
+			<li><a href="#Page_115">115</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Industrial combination,&nbsp;
+		<ul>
+			<li><a href="#Page_81">81</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp;&nbsp; organization,&nbsp;
+			<ul>
+				<li><a href="#Page_78">78</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp;&nbsp; revolution,&nbsp;
+			<ul>
+				<li><a href="#Page_76">76</a></li>
+			</ul>
+			</li>
+
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>International exploitation,&nbsp;
+		<ul>
+			<li><a href="#Page_128">128</a></li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;&nbsp; finance,&nbsp;
+			<ul>
+				<li><a href="#Page_135">135</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;&nbsp; Harvester Co.,&nbsp;
+			<ul>
+				<li><a href="#Page_133">133</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Investing nations,&nbsp;
+		<ul>
+			<li><a href="#Page_127">127</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Investment bankers,&nbsp;
+		<ul>
+			<li><a href="#Page_86">86</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Investments in the United States,&nbsp;
+		<ul>
+			<li><a href="#Page_130">130</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Italy, gains of,&nbsp;
+		<ul>
+			<li><a href="#Page_197">197</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Job ownership,&nbsp;
+		<ul>
+			<li><a href="#Page_94">94</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Labor, colonial shortage of,&nbsp;
+		<ul>
+			<li><a href="#Page_38">38</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Landlordism,&nbsp;
+		<ul>
+			<li><a href="#Page_105">105</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Land ownership,&nbsp;
+		<ul>
+			<li><a href="#Page_103">103</a></li>
+			<li class="subitem">"&nbsp;&nbsp;policy,&nbsp;
+			<ul>
+				<li><a href="#Page_104">104</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Latin America,&nbsp;
+		<ul>
+			<li><a href="#Page_203">203</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Liberty, desire for,&nbsp;
+		<ul>
+			<li><a href="#Page_8">8</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Manifest destiny,&nbsp;
+		<ul>
+			<li><a href="#Page_171">171</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Mastery, avenues of,&nbsp;
+		<ul>
+			<li><a href="#Page_92">92</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Mexican War, provocation of,&nbsp;
+		<ul>
+			<li><a href="#Page_55">55</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; " &nbsp; &nbsp; success of,&nbsp;
+			<ul>
+				<li><a href="#Page_56">56</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Mexico, conquest of,&nbsp;
+		<ul>
+			<li><a href="#Page_54">54</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Monroe Doctrine,&nbsp;
+		<ul>
+			<li><a href="#Page_202">202</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp; &nbsp; logic of,&nbsp;
+			<ul>
+				<li><a href="#Page_207">207</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>National City Bank,&nbsp;
+		<ul>
+			<li><a href="#Page_138">138</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Navy League,&nbsp;
+		<ul>
+			<li><a href="#Page_146">146</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Negro civilization, in Africa,&nbsp;
+		<ul>
+			<li><a href="#Page_40">40</a></li>
+			<li class="subitem">" &nbsp; slaves, values of,&nbsp;
+			<ul>
+				<li><a href="#Page_47">47</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Negroes, numbers enslaved,&nbsp;
+		<ul>
+			<li><a href="#Page_43">43</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>New Europe,&nbsp;
+		<ul>
+			<li><a href="#Page_246">246</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Next War, contestants in,&nbsp;
+		<ul>
+			<li><a href="#Page_236">236</a></li>
+			<li class="subitem">" &nbsp; "&nbsp; &nbsp; preparations for,&nbsp;
+			<ul>
+				<li><a href="#Page_241">241</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; "&nbsp; &nbsp; pretexts for,&nbsp;
+			<ul>
+				<li><a href="#Page_238">238</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>New Orleans, struggle for,&nbsp;
+		<ul>
+			<li><a href="#Page_50">50</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Ownership, advantages of,&nbsp;
+		<ul>
+			<li><a href="#Page_114">114</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Panama, relations with,&nbsp;
+		<ul>
+			<li><a href="#Page_213">213</a></li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; revolution in,&nbsp;
+			<ul>
+				<li><a href="#Page_215">215</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; seizure of,&nbsp;
+			<ul>
+				<li><a href="#Page_214">214</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Patriotism,&nbsp;
+		<ul>
+			<li><a href="#Page_147">147</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Peace Treaty, provisions of,&nbsp;
+		<ul>
+			<li><a href="#Page_224">224</a></li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; " &nbsp; &nbsp; &nbsp; results of,&nbsp;
+			<ul>
+				<li><a href="#Page_194">194</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Personal incomes, sources of,&nbsp;
+		<ul>
+			<li><a href="#Page_116">116</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Philippines, conquest of,&nbsp;
+		<ul>
+			<li><a href="#Page_69">69</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Plutocracy,&nbsp;
+		<ul>
+			<li><a href="#Page_117">117</a></li>
+			<li class="subitem">&nbsp; "&nbsp;  &nbsp; &nbsp; &nbsp; control of,&nbsp;
+			<ul>
+				<li><a href="#Page_148">148</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp;  &nbsp; &nbsp; &nbsp; dictatorship of,&nbsp;
+			<ul>
+				<li><a href="#Page_92">92</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp;  &nbsp; &nbsp; &nbsp; domestic power of,&nbsp;
+			<ul>
+				<li><a href="#Page_153">153</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp;  &nbsp; &nbsp; &nbsp; economic gains of,&nbsp;
+			<ul>
+				<li><a href="#Page_151">151</a></li>
+			</ul>
+			</li>
+			<li class="subitem">&nbsp; "&nbsp;  &nbsp; &nbsp; &nbsp; growing power of,&nbsp;
+			<ul>
+				<li><a href="#Page_143">143</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Popular government,&nbsp;
+		<ul>
+			<li><a href="#Page_9">9</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Population, increase of,&nbsp;
+		<ul>
+			<li><a href="#Page_50">50</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Preparedness,&nbsp;
+		<ul>
+			<li><a href="#Page_145">145</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Press censorship,&nbsp;
+		<ul>
+			<li><a href="#Page_210">210</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Product ownership,&nbsp;
+		<ul>
+			<li><a href="#Page_96">96</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Profiteering,&nbsp;
+		<ul>
+			<li><a href="#Page_151">151</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Property, Indian ideas of,&nbsp;
+		<ul>
+			<li><a href="#Page_30">30</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp;ownership, security of,&nbsp;
+			<ul>
+				<li><a href="#Page_107">107</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp;rights, and civilization,&nbsp;
+			<ul>
+				<li><a href="#Page_113">113</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp;rights of,&nbsp;
+			<ul>
+				<li><a href="#Page_103">103</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp;safeguards to,&nbsp;
+			<ul>
+				<li><a href="#Page_108">108</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Public opinion, control of,&nbsp;
+		<ul>
+			<li><a href="#Page_98">98</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Resources of the United States,&nbsp;
+		<ul>
+			<li><a href="#Page_179">179</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Revolution in Europe,&nbsp;
+		<ul>
+			<li><a href="#Page_246">246</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Russia, Allied attack on,&nbsp;
+		<ul>
+			<li><a href="#Page_245">245</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; &nbsp;world position of,&nbsp;
+			<ul>
+				<li><a href="#Page_231">231</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Slave Coast,&nbsp;
+		<ul>
+			<li><a href="#Page_39">39</a></li>
+			<li class="subitem">"&nbsp; &nbsp;power, defeat of,&nbsp;
+			<ul>
+				<li><a href="#Page_61">61</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp;trade, America's part in,&nbsp;
+			<ul>
+				<li><a href="#Page_44">44</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; "&nbsp; &nbsp; beginnings of,&nbsp;
+			<ul>
+				<li><a href="#Page_39">39</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; "&nbsp; &nbsp; conditions of,&nbsp;
+			<ul>
+				<li><a href="#Page_43">43</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; "&nbsp; &nbsp; development of,&nbsp;
+			<ul>
+				<li><a href="#Page_42">42</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Slavery, and expansion,&nbsp;
+		<ul>
+			<li><a href="#Page_60">60</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; beginnings of,&nbsp;
+			<ul>
+				<li><a href="#Page_39">39</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; in the United States,&nbsp;
+			<ul>
+				<li><a href="#Page_45">45</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Slaves, early demand for,&nbsp;
+		<ul>
+			<li><a href="#Page_41">41</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Southwest, conquest of,&nbsp;
+		<ul>
+			<li><a href="#Page_51">51</a>,&nbsp;</li>
+			<li><a href="#Page_57">57</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Sovereignty, source of,&nbsp;
+		<ul>
+			<li><a href="#Page_11">11</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Spanish War,&nbsp;
+		<ul>
+			<li><a href="#Page_65">65</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Standard Oil Co.,&nbsp;
+		<ul>
+			<li><a href="#Page_134">134</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Surplus, disposal of,&nbsp;
+		<ul>
+			<li><a href="#Page_123">123</a></li>
+			<li class="subitem">"&nbsp; &nbsp; &nbsp; pressure of,&nbsp;
+			<ul>
+				<li><a href="#Page_121">121</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Teutonic peoples,&nbsp;
+		<ul>
+			<li><a href="#Page_26">26</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Texas, annexation of,&nbsp;
+		<ul>
+			<li><a href="#Page_52">52</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Timber reserves,&nbsp;
+		<ul>
+			<li><a href="#Page_180">180</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Transportation facilities,&nbsp;
+		<ul>
+			<li><a href="#Page_183">183</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Undeveloped countries,&nbsp;
+		<ul>
+			<li><a href="#Page_124">124</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>United States, capital of,&nbsp;
+		<ul>
+			<li><a href="#Page_181">181</a></li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;financial power of,&nbsp;
+			<ul>
+				<li><a href="#Page_154">154</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;past isolation,&nbsp;
+			<ul>
+				<li><a href="#Page_192">192</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;position of,&nbsp;
+			<ul>
+				<li><a href="#Page_221">221</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;products of,&nbsp;
+			<ul>
+				<li><a href="#Page_184">184</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;resources of,&nbsp;
+			<ul>
+				<li><a href="#Page_179">179</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;shipping,&nbsp;
+			<ul>
+				<li><a href="#Page_188">188</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;wealth and income,&nbsp;
+			<ul>
+				<li><a href="#Page_189">189</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;world attitude to,&nbsp;
+			<ul>
+				<li><a href="#Page_263">263</a></li>
+			</ul>
+			</li>
+			<li class="subitem">" &nbsp; &nbsp; &nbsp; &nbsp;" &nbsp; &nbsp; &nbsp;world power of,&nbsp;
+			<ul>
+				<li><a href="#Page_177">177</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Wealth and income,&nbsp;
+		<ul>
+			<li><a href="#Page_189">189</a></li>
+			<li class="subitem">"&nbsp; &nbsp;&nbsp;of the United States,&nbsp;
+			<ul>
+				<li><a href="#Page_89">89</a></li>
+			</ul>
+			</li>
+			<li class="subitem">"&nbsp; &nbsp;&nbsp;ownership,&nbsp;
+			<ul>
+				<li><a href="#Page_90">90</a></li>
+			</ul>
+			</li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Western Hemisphere, and the United States,&nbsp;
+		<ul>
+			<li><a href="#Page_200">200</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>World conquest,&nbsp;
+		<ul>
+			<li><a href="#Page_218">218</a></li>
+		</ul>
+		</li>
+	</ul>
+	<ul>
+		<li>Workers' business,&nbsp;
+		<ul>
+			<li><a href="#Page_257">257</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+	<li>
+	<ul>
+		<li>Yellow peril,&nbsp;
+		<ul>
+			<li><a href="#Page_232">232</a></li>
+		</ul>
+		</li>
+	</ul>
+	</li>
+</ul>
+</div>
+
+<p>&nbsp;</p>
+<p>&nbsp;</p>
+<hr class="full" />
+<p>***END OF THE PROJECT GUTENBERG EBOOK THE AMERICAN EMPIRE***</p>
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+<pre>
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+The Project Gutenberg eBook of The American Empire, by Scott Nearing
+
+
+This eBook is for the use of anyone anywhere at no cost and with
+almost no restrictions whatsoever.  You may copy it, give it away or
+re-use it under the terms of the Project Gutenberg License included
+with this eBook or online at www.gutenberg.org
+
+
+
+
+
+Title: The American Empire
+
+
+Author: Scott Nearing
+
+
+
+Release Date: January 12, 2009  [eBook #27787]
+
+Language: English
+
+Character set encoding: ISO-646-US (US-ASCII)
+
+
+***START OF THE PROJECT GUTENBERG EBOOK THE AMERICAN EMPIRE***
+
+
+E-text prepared by Peter Vachuska, Martin Pettit, and the Project
+Gutenberg Online Distributed Proofreading Team (http://www.pgdp.net)
+
+
+
+THE AMERICAN EMPIRE
+
+by
+
+SCOTT NEARING
+
+Author of
+"Wages in the United States"
+"Income"
+"Financing the Wage-Earner's Family"
+"Anthracite"
+"Poverty and Riches," etc.
+
+
+
+
+
+
+
+New York
+The Rand School of Social Science
+7 East 15th Street
+1921
+
+All rights reserved
+
+Copyright, 1921,
+by the
+Rand School of Social Science
+
+First Edition, January, 1921
+Second Edition, February, 1921
+
+
+
+
+CONTENTS
+
+
+PART I
+
+WHAT IS AMERICA?
+
+CHAPTER                                            PAGE
+
+    I The Promise of 1776                             7
+
+   II The Course of Empire                           14
+
+
+PART II
+
+THE FOUNDATIONS OF EMPIRE.
+
+A. THE CONQUEST OF AMERICA.
+
+  III Subjugating the Indians                        26
+
+   IV Slavery for a Race                             38
+
+    V Winning the West                               49
+
+   VI The Beginnings of World Dominion               60
+
+B. PLUTOCRACY.
+
+  VII The Struggle for Wealth and Power              74
+
+ VIII Their United States                            88
+
+   IX The Divine Right of Property                  103
+
+
+PART III
+
+MANIFEST DESTINY.
+
+    X Industrial Empires                            120
+
+   XI The Great War                                 143
+
+  XII The Imperial Highroad                         158
+
+
+PART IV
+
+THE UNITED STATES--A WORLD EMPIRE.
+
+ XIII The United States as a World Competitor       177
+
+  XIV The Partition of the Earth                    192
+
+   XV Pan-Americanism                               202
+
+  XVI The American Capitalist and World Empire      218
+
+
+PART V
+
+THE CHALLENGE TO IMPERIALISM.
+
+ XVII The New Imperial Alignment                    229
+
+XVIII The Challenge in Europe                       243
+
+  XIX The American Worker and World Empire          256
+
+
+
+
+The American Empire
+
+
+
+
+I. THE PROMISE OF 1776
+
+
+1. _The American Republic_
+
+The genius of revolution presided at the birth of the American Republic,
+whose first breath was drawn amid the economic, social and political
+turmoil of the eighteenth century. The voyaging and discovering of the
+three preceding centuries had destroyed European isolation and laid the
+foundation for a new world order of society. The Industrial Revolution
+was convulsing England and threatening to destroy the Feudal State.
+Western civilization, in the birthpangs of social revolution, produced
+first the American and then the French Republic.
+
+Feudalism was dying! Divine right, monarchy, aristocracy, oppression,
+despotism, tyranny--these and all other devils of the old world order
+were bound for the limbo which awaits outworn, discredited social
+institutions. The Declaration of Independence officially proclaimed the
+new order,--challenging "divine right" and maintaining that "all men are
+created equal; that they are endowed by their Creator with certain
+unalienable rights; that among these are life, liberty and the pursuit
+of happiness. That to secure these rights, governments are instituted
+among men, deriving their just powers from the consent of the governed."
+
+Life, liberty and happiness were the heritage of the human race, and
+"whenever any form of government becomes destructive of these ends, it
+is the right of the people to alter or abolish it, and to institute a
+new government laying its foundations on such principles, and organizing
+its powers in such form, as to them shall seem likely to effect their
+safety and happiness."
+
+Thus the rights of the people were declared superior to the privileges
+of the rulers; revolution was justified; and the principles of
+eighteenth century individualism were made the foundation of the new
+political state. Aristocracy was swept aside and in its stead democracy
+was enthroned.
+
+
+2. _The Yearning for Liberty_
+
+The nineteenth century re-echoed with the language of social idealism.
+Traditional bonds were breaking; men's minds were freed; their
+imaginations were kindled; their spirits were possessed by a gnawing
+hunger for justice and truth.
+
+Revolting millions shouted: "Liberty, Equality, Fraternity!" Sages
+mused; philosophers analyzed; prophets exhorted; statesmen organized
+toward this end.
+
+Men felt the fire of the new order burning in their vitals. It purged
+them. They looked into the eyes of their fellows and saw its reflection.
+Dreaming of liberty as a maiden dreams of her lover, humanity awoke
+suddenly, to find liberty on the threshold.
+
+Through the ages mankind has sought truth and justice. Vested interests
+have intervened. The powers of the established order have resisted, but
+the search has continued. That eternal vigilance and eternal sacrifice
+which are the price of liberty, are found wherever human society has
+left a record. At one point the forces of light seem to be winning. At
+another, liberty and truth are being ruthlessly crushed by the
+privileged masters of life. The struggle goes on--eternally.
+
+Liberty and justice are ideals that exist in the human heart, but they
+are none the less real. Indeed, they are in a sense more potent, lying
+thus in immortal embryo, than they could be as tangible institutions.
+Institutions are brought into being, perfected, kept past their time of
+highest usefulness and finally discarded. The hopes of men spring
+eternally, spontaneously. They are the true social immortality.
+
+
+3. _Government of the People_
+
+Feudalism as a means of organizing society had failed. The newly
+declared liberties were confided to the newly created state. It was
+political democracy upon which the founders of the Republic depended to
+make good the promise of 1776.
+
+The American colonists had fled to escape economic, political and
+religious tyranny in the mother countries. They had drunk the cup of its
+bitterness in the long contest with England over the rights of taxation,
+of commerce, of manufacture, and of local political control. They had
+their fill of a mastery built upon the special privilege of an
+aristocratic minority. It was liberty and justice they sought and
+democracy was the instrument that they selected to emancipate themselves
+from the old forms of privilege and to give to all an equal opportunity
+for life, liberty and the pursuit of happiness.
+
+Political democracy was to place the management of community business in
+the hands of the people--to give them liberty in the control of public
+affairs. The highest interest of democracy was to be the interest of the
+people. There could be no higher interest because the people were
+supreme. The people were to select the public servants; direct their
+activities; determine public policy; prescribe the law; demand its
+enforcement; and if need be assert their superior authority over any
+part of the government, not excepting the constitution.[1]
+
+Democracy, in politics, was based on the idea that public affairs could
+best be run by the public voice. However expert may be the hand that
+administers the laws, the hand and the heart that renders the final
+decision in large questions must belong to the public.[2]
+
+The people who laid the foundations for democracy in France and the
+United States feared tyranny. They and their ancestors had been, for
+centuries, the victims of governmental despotism. They were on their
+guard constantly against governmental aggression in any form. And they,
+therefore, placed the strictest limitations upon the powers that
+governments should enjoy.
+
+Special privilege government was run by a special class,--the hereditary
+aristocracy--in the interest and for the profit of that class. They held
+the wealth of the nation--the land--and lived comfortably upon its
+produce. They never worked--no gentleman could work and remain a
+gentleman. They carried on the affairs of the court--sometimes well,
+sometimes badly; maintained an extravagant scale of social life; built
+up a vicious system of secret international diplomacy; commanded in time
+of war, and at all times; levied rents and taxes which went very largely
+to increase their own comfort and better their own position in life. The
+machinery of government and the profits from government remained in the
+hands of this one class.
+
+Class government from its very nature could not be other than
+oppressive. "All hereditary government over a people is to them a
+species of slavery and representative government is freedom." "All
+hereditary government is in its nature tyranny.... To inherit a
+government is to inherit the people as if they were flocks and
+herds."[3]
+
+
+4. _The Source of Authority_
+
+The people were to be the source of authority in the new state. The
+citizen was to have a voice because he was an adult, capable of
+rendering judgment in the selection of public servants and in the
+determination of public policy.
+
+All through history there had been men into whose hands supreme power
+had been committed, who had carried this authority with an astounding
+degree of wisdom and integrity. For every one who had comported himself
+with such wisdom in the presence of supreme authority, there were a
+score, or more likely a hundred, who had used this power stupidly,
+foolishly, inefficiently, brutally or viciously.
+
+Few men are good enough or wise enough to keep their heads while they
+hold in their hands unlimited authority over their fellows. The pages of
+human experience were written full of the errors, failures, and abuses
+of which such men so often have been guilty.
+
+The new society, in an effort to prevent just such transgressions of
+social well being, placed the final power to decide public questions in
+the hands of the people. It was not contended, or even hoped that the
+people would make no mistakes, but that the people would make fewer
+mistakes and mistakes less destructive of public well-being than had
+been made under class government. At least this much was gained, that
+the one who abused power must first secure it from those whom he
+proposed to abuse, and must later exercise it unrestrained to the
+detriment of those from whom the power was derived and in whom it still
+resided.
+
+The citizen was to be the source of authority. His word, combined with
+that of the majority of his fellows, was final. He delegated authority.
+He assented to laws which were administered over all men, including
+himself. He accepts the authority of which he was the source.
+
+
+5. _The American Tradition_
+
+This was the American tradition. This was the language of the new, free
+world. Life, liberty and happiness; popular sovereignty; equal
+opportunity. This, to the people of the old countries was the meaning of
+America. This was the promise of 1776.
+
+When President Wilson went to Europe, speaking the language of liberty
+that is taught in every American schoolroom, the plain people turned to
+him with supreme confidence. To them he was the embodiment of the spirit
+of the West.
+
+Native-born Americans hold the same idea. To them the Declaration of
+Independence was a final break with the old order of monarchical,
+imperial Europe. It was the charter of popular rights and human
+liberties, establishing once for all the principles of self-government
+and equal opportunity.
+
+The Statue of Liberty, guarding the great port of entrance to America,
+symbolizes the spirit in which foreigners and natives alike think of
+her--as the champion of the weak and the oppressed; the guardian of
+justice; the standard-bearer of freedom.
+
+This spirit of America is treasured to-day in the hearts of millions of
+her citizens. To the masses of the American people America stands to-day
+as she always stood. They believe in her freedom; they boast of her
+liberties; they have faith in her great destiny as the leader of an
+emancipated world. They respond, as did their ancestors, to the great
+truths of liberty, equality, and fraternity that inspired the eighteenth
+century.
+
+The tradition of America is a hope, a faith, a conviction, a burning
+endeavor, centering in an ideal of liberty and justice for the human
+race.
+
+Patrick Henry voiced this ideal when, a passionate appeal for freedom
+being interrupted by cries of "Treason, treason!" he faced the objector
+with the declaration, "If this be treason, make the most of it!"
+
+Eighteenth century Europe, struggling against religious and political
+tyranny, looked to America as the land of Freedom. America to them meant
+liberty. "What Athens was in miniature, America will be in magnitude,"
+wrote Tom Paine. "The one was the wonder of the ancient world; the other
+is becoming the admiration, the model of the present." ("The Rights of
+Man," Part II, Chapter 3.) The promise of 1776 was voiced by men who
+felt a consuming passion for freedom; a divine discontent with anything
+less than the highest possible justice; a hatred of tyranny, oppression
+and every form of special privilege and vested wrong. They yearned over
+the future and hoped grandly for the human race.
+
+FOOTNOTES:
+
+[1] "It is, Sir, the people's constitution, the people's government,
+made for the people, made by the people, and answerable to the
+people."--Daniel Webster's reply to Hayne, 1830. "Speeches and
+Orations." E. P. Whipple, Boston, Little, Brown and Co., p. 257.
+
+[2] Tom Paine held ardently to this doctrine, "It is always the interest
+of a far greater number of people in a Nation to have things right than
+to let them remain wrong; and when public matters are open to debate,
+and the public judgment free, it will not decide wrong unless it decides
+too hastily!" "Rights of Man," Part II, Ch. 4.
+
+[3] "Rights of Man," Thomas Paine. Part II, Chapter 3.
+
+
+
+
+II. THE COURSE OF EMPIRE
+
+
+1. _Promise and Fulfillment_
+
+A vast gulf yawns between the inspiring promise that a handful of men
+and women made to the world in 1776, and the fulfillment of that promise
+that is embodied in twentieth century American life. The pre-war
+indifference to the loss of liberty; the gradual encroachments on the
+rights of free speech, and free assemblage and of free press; the
+war-time suppressions, tyrannies, and denials of justice; the subsequent
+activities of city, state, and national legislatures and executives in
+passing and enforcing laws that provided for military training in
+violation of conscience, the denial of freedom of belief, of thought, of
+speech, of press and of assemblage,--activities directed specifically to
+the negation of those very principles of liberty which have constituted
+so intimate a part of the American tradition of freedom,--form a
+contrast between the promise of 1776 and the twentieth century
+fulfillment of that promise which is brutal in its terrible intensity.
+
+Many thoughtful Americans have been baffled by this conflict between the
+aims of the eighteenth century and the accomplishments of the twentieth.
+The facts they admit. For explanation, either they may say, "It was the
+war," implying that with the cessation of hostilities and the return to
+a peace basis, the situation has undergone a radical change; or else
+they blame some individual or some organization for the extinction of
+American liberties.
+
+Great consequences arise from great causes. A general break-down of
+liberties cannot be attributed to individual caprice nor to a particular
+legislative or judicial act.
+
+The denial of liberty in the United States is a matter of large import.
+No mayor, governor, president, legislature, court, magnate, banker,
+corporation or trust, and no combination of these individuals and
+organizations could arbitrarily destroy the American Republic.
+Underneath personality and partisanship are working the forces which
+have stripped the American people of their essential liberties as the
+April sun strips the mountains of their snow.
+
+No one can read the history of the United States since the drafting of
+the Declaration of Independence without being struck by the complete
+transformation in the forms of American life. The Industrial Revolution
+which had gripped England for half a century, made itself felt in the
+United States after 1815. Steam, transportation, industrial development,
+city life, business organization, expansion across the continent--these
+are the factors that have made of the United States a nation utterly
+apart from the nation of which those who signed the Declaration of
+Independence and fought the Revolution dreamed.
+
+These economic changes have brought political changes. The American
+Republic has been thrust aside. Above its remains towers a mighty
+imperial structure,--the world of business,--bulwarked by usage and
+convention; safeguarded by legislation, judicial interpretation, and the
+whole power of organized society. That structure is the American
+Empire--as real to-day as the Roman Empire in the days of Julius Caesar;
+the French Empire under the Little Corporal, or the British Empire of
+the Great Commoner, William E. Gladstone.
+
+Approved or disapproved; exalted or condemned; the fact of empire must
+be evident even to the hasty observer. The student, tracing its
+ramifications, realizes that the structure has been building for
+generations.
+
+
+2. _The Characteristics of Empire_
+
+Many minds will refuse to accept the term "empire" as applied to a
+republic. Accustomed to link "empire" with "emperor," they conceive of a
+supreme hereditary ruler as an essential part of imperial life. A little
+reflection will show the inadequacy of such a concept. "The British
+Empire" is an official term, used by the British Government, although
+Great Britain is a limited monarchy, whose king has less power than the
+President of the United States. On the other hand, eastern potentates,
+who exercise absolute sway over their tiny dominions do not rule
+"empires."
+
+Recent usage has given the term "empire" a very definite meaning, which
+refers, not to an "emperor" but to certain relations between the parts
+of a political or even of an economic organization. The earlier uses of
+the word "empire" were, of course, largely political. Even in that
+political sense, however, an "empire" does not necessarily imply the
+domain of an "emperor."
+
+According to the definition appearing in the "New English Dictionary"
+wherever "supreme and extensive political dominion" is exercised "by a
+sovereign state over its dependencies" an empire exists. The empire is
+"an aggregation of subject territories ruled over by a sovereign state."
+The terms of the definition are political, but it leaves the emperor
+entirely out of account and makes an empire primarily a matter of
+organization and not of personality.
+
+During the last fifty years colonialism, the search for foreign markets,
+and the competition for the control of "undeveloped" countries has
+brought the words "empire" and "imperialism" into a new category, where
+they relate, not to the ruler--be he King or Emperor--but to the
+extension of commercial and economic interests. The "financial
+imperialism" of F. C. Howe and the "imperialism" of J. A. Hobson are
+primarily economic and only incidentally political.
+
+"Empire" conveys the idea of widespread authority, dominion, rule,
+subjugation. Formerly it referred to political power; to-day it refers
+to economic power. In either case the characteristics of empire are,--
+
+
+     1. Conquered territory.
+
+     2. Subject peoples.
+
+     3. An imperial or ruling class.
+
+     4. The exploitation of the subject peoples and the conquered
+     territory for the benefit of the ruling class.
+
+
+Wherever these four characteristics of imperial organization exist,
+there is an empire, in all of its essential features. They are the
+acid-test, by which the presence of empire may be determined.
+
+Names count for nothing. Rome was an empire, while she still called
+herself a republic. Napoleon carried on his imperial activities for
+years under the authority of Republican France. The existence of an
+empire depends, not upon the presence of an "emperor" but upon the
+presence of those facts which constitute Empire,--conquered territory;
+subject peoples; an imperial class; exploitation by and for this class.
+If these facts exist in Russia, Russia is an empire; if they are found
+in Germany, Germany is an empire; if they appear in the United States,
+the United States is an empire none the less surely,--traditions,
+aspirations and public conviction to the contrary notwithstanding.
+
+
+3. _The Preservation of Empire_
+
+The first business of an imperial class is the preservation of the
+empire to which it owes its advantages and privileges. Therefore, in its
+very essence, imperialism is opposed to popular government. "The
+greatest good to the greatest number" is the ideal that directs the life
+of a self-governing community. "The safety and happiness of the ruling
+class" is the first principle of imperial organization.
+
+Imperialism is so generally recognized and so widely accepted as a
+mortal foe of popular government that the members of an imperial class,
+just rising into power, are always careful to keep the masses of the
+people ignorant of the true course of events. This necessity explains
+the long period, in the history of many great empires, when the name and
+forms of democracy were preserved, after the imperial structure had been
+established on solid foundations. Slow changes, carefully directed and
+well disguised, are necessary to prevent outraged peoples from rising
+against an imperial order when they discover how they have been sold
+into slavery. Even with all of the safeguards, under the control of the
+ablest statesmen, Caesar frequently meets his Brutus.
+
+The love of justice; the yearning for liberty; the sense of fair play;
+the desire to extend opportunity, all operate powerfully upon those to
+whom the principles of self-government are dearest, leading them to
+sacrifice position, economic advantage, and sometimes life itself for
+the sake of the principles to which they have pledged their faith.
+
+Therein lies what is perhaps one of the most essential differences
+between popular government and empire. The former rests upon certain
+ideas of popular rights and liberties. The latter is a weapon of
+exploitation in the hands of the ruling class. Popular government lies
+in the hopes and beliefs of the people. Empire is the servant of
+ambition and the shadow of greed. Popular government has been evolved by
+the human race at an immense sacrifice during centuries of struggle
+against the forms and ideas that underly imperialism. Since men have set
+their backs on the past and turned their faces with resolute hope to the
+future, empire has repelled them, while democracy has called and
+beckoned.
+
+Empires have been made possible by "bread and circuses"; by appealing to
+an abnormally developed sense of patriotism; by the rule of might where
+largess and cajolery have failed. Rome, Germany and Britain are
+excellent examples of these three methods. In each case, millions of
+citizens have had faith in the empire, believing in its promise of glory
+and of victory; but on the other hand, this belief could be maintained
+only by a continuous propaganda--triumphs in Rome, school-books and
+"boilerplate" in Germany and England. Even then, the imperial class is
+none too secure in its privileges. Always from the abysses of popular
+discontent, there arises some Spartacus, some Liebknecht, some Smillie,
+crying that "the future belongs to the people."
+
+The imperial class, its privileges unceasingly threatened by the popular
+love of freedom--devotes not a little attention to the problem of
+"preserving law and order" by suppressing those who speak in the name of
+liberty, and by carrying on a generous advertising campaign, the object
+of which is to persuade the people of the advantages which they derive
+from imperial rule.
+
+During the earlier stages in the development of empire, the imperial
+class is able to keep itself and its designs in the background. As time
+passes, however, the power of the imperialist becomes more and more
+evident, until some great crisis forces the empire builders to step out
+into the open. They then appear as the frank apologists, spokesmen and
+defenders of the order for which they have so faithfully labored and
+from which they expect to gain so much.
+
+Finally, the ambition of some aggressive leader among the imperialists,
+or a crisis in the affairs of the empire leads to the next step--the
+appointment of a "dictator," "supreme ruler" or "emperor." This is the
+last act of the imperial drama. Henceforth, the imperial class divides
+its attention between,--
+
+
+     1. The suppression of agitation and revolt among the people at
+     home;
+
+     2. Maintaining the imperial sway over conquered territory;
+
+     3. Extending the boundaries of the empire and
+
+     4. The unending struggle between contending factions of the ruling
+     class for the right to carry on the work of exploitation at home
+     and abroad.
+
+
+4. _The Price of Empire_
+
+Since the imperial or ruling class is willing to go to any lengths in
+order to preserve the empire upon which its privileges depend, it
+follows that the price of empire must be reckoned in the losses that the
+masses of the people suffer while safeguarding the privileges of the
+few.
+
+As a matter of course, conquered and dependent people pay with their
+liberty for their incorporation into the empire that holds dominion over
+them. On any other basis, empire is unthinkable. Indeed the terms
+"dependencies," "domination," and "subject" carry with them only one
+possible implication--the subordination or extinction of the liberties
+of the peoples in question.
+
+The imperial class--a minority--depends for its continued supremacy upon
+the ownership of some form of property, whether this property be slaves,
+or land, or industrial capital. As Veblen puts it: "The emergence of the
+leisure class coincides with the beginning of ownership." ("Theory of
+the Leisure Class," T. Veblen, New York. B. W. Huebsch, 1899, p. 22.)
+Necessarily, therefore, the imperial class will sacrifice the so-called
+human or personal rights of the home population to the protection of its
+property rights. Indeed the property rights come to be regarded as the
+essential human rights, although there is but a small minority of the
+community that can boast of the possession of property.
+
+The superiority of ruling class property rights over the personal rights
+and liberties of the inhabitants in a subject territory is taken as a
+matter of course. Even in the home country, where the issue is clearly
+made, the imperial class will sacrifice the happiness, the health, the
+longevity, and the lives of the propertyless class in the interest of
+"law and order" and "the protection of property." The stories of the
+Roman populace; of the French peasants under Louis XIV; of the English
+factory workers (men, women and children) during the past hundred years,
+and of the low skilled workers in the United States since the Civil
+War, furnish ample proof of the correctness of this contention. The
+life, liberty and happiness of the individual citizen is a matter of
+small importance so long as the empire is saved.
+
+A crisis in imperial affairs is always regarded, by the ruling class, as
+a legitimate reason for curtailing the rights of the people. Under
+ordinary circumstances, the imperial class will gain rather than lose
+from the exercise of "popular liberties." Indeed, the exercise of these
+liberties is of the greatest assistance in convincing the people that
+they are enjoying freedom and thus keeping them satisfied with their
+lot. But in a period of turmoil, with men's hearts stirred, and their
+souls aflamed with conviction and idealism, there is always danger that
+the people may exercise their "unalienable right" to "alter or abolish"
+their form of government. Consequently, during a crisis, the imperial
+class takes temporary charge of popular liberties. Every great empire
+engaged in the recent war passed through such an experience. In each
+country the ruling class announced that the war was a matter of life and
+death. Papers were suppressed or censored; free speech was denied; men
+were conscripted against will and conscience; constitutions were thrust
+aside; laws "slumbered"; writers and thinkers were jailed for their
+opinions; food was rationed; industries were controlled--all in the
+interest of "winning the war." After the war was won, the victors
+practiced an even more rigorous suppression while they were "making the
+peace." Then followed months and years of protests and demands, until,
+one by one, the liberties were retaken by the people or else the
+war-tyranny, once firmly established, became a part of "the heritage of
+empire." In such cases, where liberties were not regained, the plain
+people learned to do without them.
+
+Liberty is the price of empire. Imperialism presupposes that the people
+will be willing, at any time, to surrender their "rights" at the call of
+the rulers.
+
+
+5. _The Universality of Empire_
+
+Imperialism is not new, nor is it confined to one nation or to one race.
+On the contrary it is as old as history and as wide as the world.
+
+Before Rome, there was Carthage. Before Carthage, there were Greece,
+Macedonia, Egypt, Assyria, China. Where history has a record, it is a
+record of empire.
+
+During modern times, international affairs have been dominated by
+empires. The great war was a war between empires. During the first three
+years, the two chief contestants were the British Empire on the one hand
+and the German Empire on the other. Behind these leaders were the
+Russian Empire, the Italian Empire, the French Empire, and the Japanese
+Empire.
+
+The Peace of Versailles was a peace between empires. Five empires
+dominated the peace table--Great Britain, France, Italy, Japan and the
+United States. The avowedly anti-imperial nations of Europe--Russia and
+Hungary--were not only excluded from the deliberations of the Peace
+Table, but were made the object of constant diplomatic, military and
+economic aggression by the leading imperialist nations.
+
+
+6. _The Evolution of Empire_
+
+Empires do not spring, full grown, from the surroundings of some great
+historic crisis. Rather they, like all other social institutions, are
+the result of a long series of changes that lead by degrees from the
+pre-imperial to the imperial stage. Many of the great empires of the
+past two thousand years have begun as republics, or, as they are
+sometimes called, "democracies," and the processes of transformation
+from the republican to the imperial stage have been so gradual that the
+great mass of the people were not aware that any change had occurred
+until the emperor ascended the throne.
+
+The development of empire is of necessity a slow process. There are the
+dependent people to be subjected; the territory to conquered; the
+imperial class to be built up. This last process takes, perhaps, more
+time than either of the other two. Class consciousness is not created in
+a day. It requires long experience with the exercise of imperial power
+before the time has come to proclaim an emperor, and forcibly to take
+possession of the machinery of public affairs.
+
+
+7. _The United States and the Stages of Empire_
+
+Any one who is familiar with its history will realize at once that the
+United States is passing through some of the more advanced stages in the
+development of empire. The name "Republic" still remains; the traditions
+of the Republic are cherished by millions; the republican forms are
+almost intact, but the relations of the United States to its conquered
+territory and its subject peoples; the rapid maturation of the
+plutocracy as a governing class or caste; the shamelessness of the
+exploitation in which the rulers have indulged; and the character of the
+forces that are now shaping public policy, proclaim to all the world the
+fact of empire.
+
+The chief characteristics of empire exist in the United States. Here are
+conquered territory; subject peoples; an imperial, ruling class, and the
+exploitation by that class of the people at home and abroad. During
+generations the processes of empire have been working, unobserved, in
+the United States. Through more than two centuries the American people
+have been busily laying the foundations and erecting the imperial
+structure. For the most part, they have been unconscious of the work
+that they were doing, as the dock laborer, is ordinarily unconscious of
+his part in the mechanism of industry. Consciously or unconsciously, the
+American people have reared the imperial structure, until it stands,
+to-day, imposing in its grandeur, upon the spot where many of the
+founders of the American government hoped to see a republic.
+
+The entrance of the United States into the war did not greatly alter
+the character of the forces at work, nor did it in any large degree
+change the direction in which the country was moving. Rather, it brought
+to the surface of public attention factors of American life that had
+been evolving unnoticed, for generations.
+
+The world situation created by the war compelled the American imperial
+class to come out in the open and to occupy a position that, while
+wholly inconsistent with the traditions of American life, is
+nevertheless in keeping with the demands of imperial necessity. The
+ruling class in the United States has taken a logical step and has made
+a logical stand. The masters of American life have done the only thing
+that they could do in the interests of the imperial forces that they
+represent. They are the victims, as much as were the Kaiser and the Czar
+on the one hand, and the Belgians and the Serbs on the other, of that
+imperial necessity that knows no law save the preservation of its own
+most sacred interests.
+
+Certain liberal American thinkers have taken the stand that the
+incidents of 1917-1918 were the result of the failure of the President,
+and of certain of his advisers, to follow the theories which he had
+enunciated, and to stand by the cause that he had espoused. These
+critics overlook the incidental character of the war as a factor in
+American domestic policy. The war never assumed anything like the
+importance in the United States that it did among the European
+belligerents. On the surface, it created a furore, but underneath the
+big fact staring the administration in the face was the united front of
+the business interests, and their organized demands for action. The
+far-seeing among the business men realized that the plutocratic
+structure the world over was in peril, and that the fate of the whole
+imperial regime was involved in the European struggle. The Russian
+Revolution of March 1917 was the last straw. From that time on the
+entrance of the United States into the war became a certainty as the
+only means of "saving (capitalist) civilization."
+
+The thoughtful student of the situation in the United States is not
+deceived by personalities and names. He realizes that the events of
+1917-1918 have behind them generations of causes which lead logically to
+just such results; that he is witnessing one phase of a great process in
+the life of the American nation--a process that is old in its principles
+yet ever new in its manifestations.
+
+Traditional liberties have always given way before imperial necessity.
+An examination of the situation in which the ruling class of the United
+States found itself in 1917, and of the forces that were operating to
+determine public policy, must convince even the enthusiast that the
+occurrences of 1917 and the succeeding years were the logical outcome of
+imperial necessity. To what extent that explanation will account for the
+discrepancy between the promise of 1776 and the twentieth century
+fulfillment of that promise must appear from a further examination of
+the evidence.
+
+
+
+
+III. SUBJUGATING THE INDIANS
+
+
+1. _The Conquering Peoples_
+
+The first step in the establishment of empire--the conquest of territory
+and the subjugation of the conquered populations,--was taken by the
+people of the United States at the time of their earliest settlements.
+They took the step naturally, unaffectedly, as became the sons of their
+fathers.
+
+The Spanish, French, and English who made the first settlement in North
+America were direct descendants of the tribes that have swept across
+Europe and portions of Asia during the past three or four thousand
+years. These tribes, grouped on the basis of similarity in language
+under the general term "Aryan," hold a record of conquest that fills the
+pages of written history.
+
+Hunger; the pressure of surplus population; the inrush of new hordes of
+invaders, drove them on. Ambition; the love of adventure; the lure of
+new opportunities in new lands, called them further. Meliorism,--the
+desire to better the conditions of life for themselves and for their
+children--animated them. In later years the necessity of disposing of
+surplus wealth impelled them. Driven, lured, coerced, these Aryan tribes
+have inundated the earth. Passing beyond the boundaries of Europe, they
+have crossed the seas into Africa, Asia, America and Australia.
+
+Among the Aryans, after bitter strife, the Teutons have attained
+supremacy. The "Teutonic Peoples" are "the English speaking inhabitants
+of the British Isles, the German speaking inhabitants of Germany,
+Austria-Hungary and Switzerland, the Flemish speaking inhabitants of
+Belgium, the Scandinavian inhabitants of Sweden and Norway and
+practically all of the inhabitants of Holland and Denmark."
+("Encyclopedia Britannica.")
+
+This Teutonic domination has been established only by the bitterest of
+struggles. During the time when North America was being settled, the
+English dispossessed first the Spanish and later the French. Since the
+Battle of Waterloo--won by English and German troops; and the Crimean
+War--won by British against Russian troops--the Teutonic power has gone
+unchallenged and so it remains to-day.
+
+The dominant power in the United States for nearly two centuries has
+been the English speaking power. Thus the Americans draw their
+inspiration, not only from the Aryan, but from the English speaking
+Teutons--the most aggressive and dominating group among the Aryans.
+
+Three hundred years ago the title to North America was claimed by Spain,
+France and Great Britain. The land itself was almost entirely in the
+hands of Indian tribes which held the possession that according to the
+proverb, is "nine points of the law."
+
+The period of American settlement has witnessed the rapid dispossession
+of the original holders, until, at the present time, the Indians have
+less than two per cent of the land area of the United States.[4]
+
+The conquest, by the English speaking whites, of the three million
+square miles which comprise the United States has been accomplished in a
+phenomenally short space of time. Migration; military occupation;
+appropriation of the lands taken from the "enemy;" settlement, and
+permanent exploitation--through all these stages of conquest the country
+has moved.
+
+The "Historical Register of the United States Army" (F. B. Heitman,
+Washington, Govt. Print., 1903, vol. 2, pp. 298-300) contains a list of
+114 wars in which the United States has been engaged since 1775. The
+publication likewise presents a list of 8600 battles and engagements
+incident to these 114 wars. Two of these wars were with England, one
+with Mexico and one with Spain. These, together with the Civil War and
+the War with Germany, constitute the major struggles in which the United
+States has been engaged. In addition to these six great wars there were
+the numerous wars with the Indians, the last of which (with the
+Chippewa) occurred in 1898. Some of these Indian "wars" were mere
+policing expeditions. Others, like the wars with the Northwest Indians,
+with the Seminoles and with the Apaches, lasted for years and involved a
+considerable outlay of life and money.
+
+When the Indian Wars were ended, and the handful of red men had been
+crushed by the white millions, the American Indians, once possessors of
+a hunting ground that stretched across the continent, found themselves
+in reservations, under government tutelage, or else, abandoning their
+own customs and habits of life, they accepted the "pale-face" standards
+in preference to their own well-loved traditions.
+
+The territory flanking the Mississippi Valley, with its coastal plains
+and the deposits of mineral wealth, is one of the richest in the world.
+Only two other areas, China and Russia, can compare with it in
+resources.
+
+This garden spot came into the possession of the English speaking whites
+almost without a struggle. It was as if destiny had held a door tight
+shut for centuries and suddenly had opened it to admit her chosen
+guests.
+
+History shows that such areas have almost always been held by one
+powerful nation after another, and have been the scene of ferocious
+struggles. Witness the valleys of the Euphrates, the Nile, the Danube,
+the Po and the Rhine. The barrier of the Atlantic saved North America.
+
+Had the Mississippi Valley been in Europe, Asia or Northern Africa, it
+would doubtless have been blood-soaked for centuries and dominated by
+highly organized nations, armed to the teeth. Lying isolated, it
+presented an almost virgin opportunity to the conquering Teutons of
+Western Europe.
+
+Freed by their isolated position from the necessity of contending
+against outside aggression, the inhabitants of the United States have
+expended their combative energies against the weaker peoples with whom
+they came into immediate contact,--
+
+
+     1. The Indians, from whom they took the land and wrested the right
+     to exploit the resources of the continent;
+
+     2. The African Negroes who were captured and brought to America to
+     labor as slaves;
+
+     3. The Mexicans, from whom they took additional slave territory at
+     a time when the institution of slavery was in grave danger, and
+
+     4. The Spanish Empire from which they took foreign investment
+     opportunities at a time when the business interests of the country
+     first felt the pressure of surplus wealth.
+
+
+Each of these four groups was weak. No one of them could present even
+the beginnings of an effectual resistance to the onslaught of the
+conquerors. Each in turn was forced to bow the knee before overwhelming
+odds.
+
+
+2. _The First Obstacle to Conquest_
+
+The first obstacle to the spread of English civilization across the
+continent of North America was the American Indian. He was in possession
+of the country; he had a culture of his own; he held the white man's
+civilization in contempt and refused to accept it. He had but one
+desire,--to be let alone.
+
+The continent was a "wilderness" to the whites. To the Indians it was a
+home. Their villages were scattered from the Atlantic to the Pacific,
+from the Gulf to Alaska; they knew well its mountains, plains and
+rivers. A primitive people, supporting themselves largely by hunting,
+fishing, simple agriculture and such elemental manual arts as pottery
+and weaving, they found the vast stretches of North America none too
+large to provide them with the means of satisfying their wants.
+
+The ideas of the Indian differed fundamentally from those of the white
+man. Holding to the Eastern conception which makes the spiritual life
+paramount, he reduced his material existence to the simplest possible
+terms. He had no desire for possessions, which he regarded--at the
+best--as "only means to the end of his ultimate perfection."[5] To him,
+the white man's desire for wealth was incomprehensible and the white
+man's sedentary life was contemptible. He must be free at all times to
+commune with nature in the valleys, and at sunrise and sunset to ascend
+the mountain peak and salute the Great Spirit.
+
+The individual Indian--having no desire for wealth--could not be bribed
+or bought for gold as could the European. The leaders, democratically
+selected, and held by the most enduring ties of loyalty to their tribal
+oaths, were above the mercenary standards of European commerce and
+statesmanship. Friendly, hospitable, courteous, generous, hostile,
+bitter, ferocious they were--but they were not for sale.
+
+The attitude of the Indian toward the land which the white men coveted
+was typical of his whole relation with white civilization. "Land
+ownership, in the sense in which we use the term, was unknown to the
+Indians till the whites came among them."[6] The land devoted to
+villages was tribal property; the hunting ground surrounding the village
+was open to all of the members of the tribe; between the hunting grounds
+of different tribes there was a neutral territory--no man's land--that
+was common to both. If a family cultivated a patch of land, the
+neighbors did not trespass. Among the Indians of the Southwest the
+village owned the agricultural land and "periodically its governor,
+elected by popular vote, would distribute or redistribute the arable
+acres among his constituents who were able to care for them."[7] The
+Indians believed that the land, like the sunlight, was a gift of the
+Great Spirit to his children, and they were as willing to part with the
+one as with the other.
+
+They carried their communal ideas still farther. Among the Indians of
+the Northwest, a man's possessions went at his death to the whole tribe
+and were distributed among the tribal members. Among the Alaskan
+Indians, no man, during his life, could possess more than he needed
+while his neighbor lacked. Food was always regarded as common property.
+"The rule being to let him who was hungry eat, wherever he found that
+which would stay the cravings of his stomach."[8] The motto of the
+Indian was "To each according to his need."
+
+Such a communist attitude toward property, coupled with a belief that
+the land--the gift of the Great Spirit--was a trust committed to the
+tribe, proved a source of constant irritation to the white colonists who
+needed additional territory. As the colonies grew, it became more and
+more imperative to increase the land area open for settlement, and to
+such encroachments the Indian offered a stubborn resistance.
+
+The Indian would not--could not--part with his land, neither would he
+work, as a slave or a wage-servant. Before such degradation he preferred
+death. Other peoples--the negroes; the inhabitants of Mexico, Peru and
+the West Indies; the Hindus and the Chinese--made slaves or servants.
+The Indian for generations held out stolidly against the efforts of
+missionaries, farmers and manufacturers alike to convert him into a
+worker.
+
+The Indian could not understand the ideas of "purchase," "sale" and
+"cash payment" that constitute essential features of the white man's
+economy. To him strength of limb, courage, endurance, sobriety and
+personal dignity and reserve were infinitely superior to any of the
+commercial virtues which the white men possessed.
+
+This attitude of the Indian toward European standards of civilization;
+his indifference to material possessions; his unwillingness to part with
+the land; and his refusal to work, made it impossible to "assimilate"
+him, as other peoples were assimilated, into colonial society. The
+individual Indian would not demean himself by becoming a cog in the
+white man's machine. He preferred to live and die in the open air of his
+native hills and plains.
+
+The Indian was an intense individualist--trained in a school of
+experience where initiative and personal qualities were the tests of
+survival. He placed the soles of his moccasined feet firmly against his
+native earth, cast his eyes around him and above him and melted
+harmoniously into his native landscape.
+
+Missionaries and teachers labored in vain--once an Indian, always an
+Indian. The white settlers pushed on across mountain ranges and through
+valleys. Generations came and went without any marked progress in
+bringing the white men and the red men together. When the Indian, in the
+mission or in the government school did become "civilized," he gave over
+his old life altogether and accepted the white man's codes and
+standards. The two methods of life were too far apart to make
+amalgamation possible.
+
+
+3. _Getting the Land_
+
+The white man must have land! Population was growing. The territory
+along the frontier seemed rich and alluring.
+
+Everywhere, the Indian was in possession, and everywhere he considered
+the sale of land in the light of parting with a birth-right. He was
+friendly at first, but he had no sympathy with the standards of white
+civilization.
+
+For such a situation there was only one possible solution. Under the
+plea that "necessity knows no law" the white man took up the task of
+eliminating the Indian, with the least friction, and in the most
+effective manner possible.
+
+There were three methods of getting the land away from the Indian--the
+easiest was by means of treaties, under which certain lands lying along
+the Atlantic Coast were turned over to the whites in exchange for larger
+territories west of the Mississippi. The second method was by purchase.
+The third was by armed conquest. All three methods were employed at some
+stage in the relations between the whites and each Indian tribe.
+
+The experience with the Cherokee Nation is typical of the relation
+between the whites and the other Indian tribes. (Annual Report of the
+Bureau of Ethnology. Vol. 5. "The Cherokee Nation," by Charles C.
+Royce.)
+
+The Cherokee nation before the year 1650 was established on the
+Tennessee River, and exercised dominion over all the country on the east
+side of the Alleghany Mountains, including the head-waters of the
+Yadkin, the Catawba, the Broad, the Savannah, the Chattahoochee and the
+Alabama. In 1775 there were 43 Cherokee towns covering portions of this
+territory. In 1799 their towns numbered 51.
+
+Treaty relations between the whites and the Cherokees began in 1721,
+when there was a peace council, held between the representatives of 37
+towns and the authorities of South Carolina. From that time, until the
+treaty made with the United States government in 1866, the Cherokees
+were gradually pushed back from their rich hunting grounds toward the
+Mississippi valley. By the treaty of 1791, the United States solemnly
+guaranteed to the Cherokees all of their land, the whites not being
+permitted even to hunt on them. In 1794 and 1804 new treaties were
+negotiated, involving additional cessions of land. By the treaty of
+1804, a road was to be cut through the Cherokee territory, free for the
+use of all United States citizens.
+
+An agitation arose for the removal of the Cherokees to some point west
+of the Mississippi River. Some of the Indians accepted the opportunity
+and went to Arkansas. Others held stubbornly to their villages.
+Meanwhile white hunters and settlers encroached on their land; white men
+debauched their women, and white desperadoes stole their stock. By the
+treaty of 1828 the United States agreed to possess the Cherokees and to
+guarantee to them forever several millions of acres west of Arkansas,
+and in addition a perpetual outlet west, and a "free and unmolested use
+of all the country lying west of the western boundary of the above
+described limits and as far west as the sovereignty of the United States
+and their right of soil extend" (p. 229). The Cherokees who had settled
+in Arkansas agreed to leave their lands within 14 months. By the treaty
+of 1836 the Cherokees ceded to the United States all lands east of the
+Mississippi. There was considerable difficulty in enforcing this
+provision but by degrees most of the Indians were removed west of the
+river. In 1859 and 1860 the Commissioner of Indian affairs prepared a
+survey of the Cherokee domain. This was opposed by the head men of the
+nation. By the Treaty of 1866 other tribes were quartered on land owned
+by the Cherokees and railroads were run through their territory.
+
+Diplomacy, money and the military forces had done their work. The first
+treaty, made in 1721, found the Cherokee nation in virtual possession of
+the mountainous regions of Southeastern United States. The twenty-fourth
+treaty (1866) left them on a tiny reservation, two thousand miles from
+their former home. Those twenty-four treaties had netted the State and
+Federal governments 81,220,374 acres of land (p. 378). To-day the
+Cherokee Nation has 63,211 acres.[9]
+
+A great nation of proud, independent, liberty-loving men and women,
+came into conflict with the whites of the Carolinas and Georgia; with
+the state and national governments. "For two hundred years a contest
+involving their very existence as a people has been maintained against
+the unscrupulous rapacity of Anglo-Saxon civilization. By degrees they
+were driven from their ancestral domain to an unknown and inhabitable
+region" (p. 371). Now the contest is ended. The white men have the land.
+The Cherokees have a little patch of territory; government support; free
+schools and the right to accept the sovereignty of the nation that has
+conquered them.
+
+The theory upon which the whites proceeded in taking the Indian lands is
+thus stated by Leupp,--"Originally, the Indians owned all the land;
+later we needed most of it for ourselves; therefore, it is but just that
+the Indians should have what is left."[10]
+
+
+4. _The Triumph of the Whites_
+
+The early white settlers had been, in almost every instance, hospitably
+or even reverentially welcomed by the Indians, who regarded them as
+children of the Great White Spirit. During the first bitter winters, it
+was the Indians who fed the colonists from their supplies of grain;
+guided them to the better lands, and shared with them their knowledge
+of hunting, fishing and agriculture. The whites retaliated with that
+cunning, grasping, bestial ferocity which has spread terror through the
+earth during the past five centuries.
+
+In the early years, when the whites were few and the Indians many, the
+whites satisfied themselves by debauching the red men with whiskey and
+bribing them with baubles and trinkets. At the same time they made
+offensive and defensive alliances with them. The Spanish in the South;
+the French in the North and the English between, leagued themselves with
+the various tribes, supplied them with gunpowder and turned them into
+mercenaries who fought for hire. Heretofore the Indian had been a free
+man, fighting his wars and feuds as free men have done time out of mind.
+The whites hired him as a professional soldier and by putting bounties
+on scalps, plying the Indians with whiskey and inciting them by every
+known device, they converted them into demons.
+
+There is no evidence to show that up to the advent of the white men the
+Indian tribes did any more fighting among themselves than the nobles of
+Germany, the city states of Italy or the other inhabitants of western
+Europe. Indeed there has recently been published a complete translation
+of the "Constitution of the Five Nations," a league to enforce peace
+which the Indians organized about the year 1390, A. D.[11] This league
+which had as its object the establishment of the "Great Peace" was built
+upon very much the same argument as that advanced for the League of
+Nations of 1919.
+
+When the whites first came to North America, the Indians were a
+formidable foe. For years they continued to be a menace to the lonely
+settler or the frontier village. But when the white settlers were once
+firmly established, the days of uncertainty were over, and the Indians
+were brushed aside as a man brushes aside a troublesome insect. Their
+"uprisings" and "wars" counted for little or nothing. They were inferior
+in numbers; they were poorly armed and equipped; they had no reserves
+upon which to draw; there was no organization among the tribes in
+distant portions of the country. The white millions swept onward. The
+Indian bands made a stand here and there but the tide of white
+civilization overwhelmed them, smothered them, destroying them and their
+civilization together.
+
+The Indians were the first obstacle to the building of the American
+Empire. Three hundred years ago the whole three million square miles
+that is now the United States was theirs. They were the American people.
+To-day they number 328,111 in a population of 105,118,467 and the total
+area of their reservations is 53,489 square miles. (Statistical Abstract
+of the U. S., 1918, pp. 8 and 776.)
+
+FOOTNOTES:
+
+[4] The total number of square miles in Indian Reservations in 1918 was
+53,490 as against 241,800 square miles in 1880. (Statistical Abstract of
+the United States, 1918, p. 8.)
+
+[5] "The Indian of To-day," C. A. Eastman. New York, Doubleday, 1915, p.
+4.
+
+[6] "The Indian and His Problem," F. E. Leupp. New York, Scribners,
+1910, p. 23.
+
+[7] Ibid., p. 24.
+
+[8] Ibid., p. 10.
+
+[9] "Referring to your inquiry of November 20, 1919, concerning the
+Cherokee Indian Reservation, you are advised that the Cherokee Indian
+country in the northeastern part of Oklahoma aggregated 4,420,068 acres.
+
+"Of said area 4,346,223 acres have been allotted in severalty to the
+enrolled members of said Cherokee Indian Nation, Oklahoma. Twenty-two
+thousand eight hundred and eighty acres were disposed of as town lots,
+or reserved for railway rights of way, churches, schools, cemeteries,
+etc., and the remaining area has been sold, or otherwise disposed of as
+provided by law.
+
+"The Cherokee tribal land in Oklahoma with the exception of the possible
+title of said Nation to certain river beds has been disposed of.
+
+"In reference to the Eastern band of Cherokees, you are advised that
+said Indians who have been incorporated hold title in fee to certain
+land in North Carolina, known as the Qualla Reservation and certain
+other lands, aggregating 63,211 acres."--Letter from the Office of
+Indian Affairs. Dec. 9, 1919, "In re Cherokee land."
+
+[10] "The Indian and His Problem," F. E. Leupp. New York, Scribners,
+1910, p. 24.
+
+[11] See Bulletin 184, New York State Museum, Albany, 1916, p. 61.
+
+
+
+
+IV. SLAVERY FOR A RACE
+
+
+1. _The Labor Shortage_
+
+The American colonists took the land which they required for settlement
+from the Indians. The labor necessary to work this land was not so
+easily secured. The colonists had set themselves the task of
+establishing European civilization upon a virgin continent. In order to
+achieve this result, they had to cut the forests; clear the land; build
+houses; cultivate the soil; construct ships; smelt iron, and carry on a
+multitude of activities that were incidental to setting up an old way of
+life in a new world. The one supreme and immediate need was the need for
+labor power. From the earliest days of colonization there had been no
+lack of harbors, fertile soil, timber, minerals and other resources.
+From the earliest days the colonists experienced a labor shortage.
+
+The labor situation was trebly difficult. First, there was no native
+labor; second, passage from Europe was so long and so hazardous that
+only the bold and venturesome were willing to attempt it, and third,
+when these adventurers did reach the new world, they had a choice
+between taking up free land and working it for themselves and taking
+service with a master. Men possessing sufficient initiative to leave an
+old home and make a journey across the sea were not the men to submit
+themselves to unnecessary authority when they might, at will, become
+masters of their own fortunes. The appeal of a new life was its own
+argument, and the newcomers struck out for themselves.
+
+Throughout the colonies, and particularly in the South where the
+plantation culture of rice and tobacco, and later of cotton, called for
+large numbers of unskilled workers, the labor problem was acute. The
+abundance of raw materials and fertile land; the speedy growth of
+industry in the North and of agriculture in the South; the generous
+profits and expanding markets created a labor demand which far
+outstripped the meager supply,--a demand that was met by the importation
+of black slaves from Africa.
+
+
+2. _The Slave Coast_
+
+The "Slave Coast" from which most of the Negroes came was discovered by
+Portuguese navigators, who were the first Europeans to venture down the
+West coast of Africa, and, rounding the "lobe" of the continent, to sail
+East along the "Gold Coast." The trade in gold and ivory which sprang up
+as a result of these early explorations led other nations of Europe to
+begin an eager competition which eventually brought French, Dutch,
+German, Danish and English commercial interests into sharp conflict with
+the Portuguese.
+
+Ships sailing from the Gold Coast for home ports made a practice of
+picking up such slaves as they could easily secure. By 1450 the number
+reaching Portugal each year was placed at 600 or 700.[12] From this
+small and quite incidental beginning there developed a trade which
+eventually supplied Europe, the West Indies, North America and South
+America with black slaves.
+
+Along the "Slave Coast," which extended from Cape Verde on the North to
+Cape St. Martha on the South, and in the hinterland there lived Negroes
+of varying temperaments and of varying standards of culture. Some of
+them were fierce and warlike. Others were docile and amenable to
+discipline. The former made indifferent slaves; the latter were eagerly
+sought after. "The Wyndahs, Nagoes and Pawpaws of the Slave Coast were
+generally the most highly esteemed of all. They were lusty and
+industrious, cheerful and submissive."[13]
+
+The natives of the Slave Coast had made some notable cultural advances.
+They smelted metals; made pottery; wove; manufactured swords and spears
+of merit; built houses of stone and of mud, and made ornaments of some
+artistic value. They had developed trade with the interior, taking salt
+from the coast and bartering it for gold, ivory and other commodities at
+regular "market places."
+
+The native civilization along the West coast of Africa was far from
+ideal, but it was a civilization which had established itself and which
+had made progress during historic times. It was a civilization that had
+evolved language; arts and crafts; tribal unity; village life, and
+communal organization. This native African civilization, in the
+seventeenth, eighteenth and early nineteenth centuries was confronted by
+an insatiable demand for black slaves. The conflicts that resulted from
+the efforts to supply that demand revolutionized and virtually destroyed
+all that was worthy of preservation in the native culture.
+
+When the whites first went to the Slave Coast there was comparatively
+little slavery among the natives. Some captives, taken in war; some
+debtors, unable to meet their obligations, and some violators of
+religious rites, were held by the chief or the headman of the tribe. On
+occasion he would sell these slaves, but the slave trade was never
+established as a business until the white man organized it.
+
+The whites came, and with guile and by force they persuaded and
+compelled the natives to permit the erection of forts and of trading
+posts. From the time of the first Portuguese settlement, in 1482, the
+whites began their work with rum and finished it with gun-powder. Rum
+destroyed the stamina of the native; gun-powder rendered his intertribal
+wars more destructive. These two agencies of European civilization
+combined, the one to degenerate, the other to destroy the native tribal
+life.
+
+The traders, adventurers, buccaneers and pirates that gathered along the
+Slave Coast were not able to teach the natives anything in the way of
+cruelty, but they could and did give them lessons in cunning, trickery
+and double dealing. Early in the history of the Gold Coast the whites
+began using the natives to make war on commercial rivals. In one famous
+instance, "the Dutch had instigated the King of Fetu to refuse the
+Assins permission to pass through his territory. These people used to
+bring a great deal of gold to Cape Coast Castle (English), and the Dutch
+hoped in this way to divert the trade to their own settlements. The King
+having complied and plundered some of the traders on the way down, the
+Assins declared war against him and were assisted by the English with
+arms and ammunition. The King of Sabol was also paid to help them, and
+the allied army (20,000 strong) inflicted a crushing defeat on the
+Fetus."[14]
+
+On another occasion, the Dutch were worsted in a war with some of the
+native tribes. Realizing that if they were to maintain themselves on the
+Coast they must raise an army as quickly as possible, they approached
+the Fetus and bargained with them to take the field and fight the
+Komendas until they had utterly exterminated them, on payment of $4,500.
+But no sooner had this arrangement been made than the English paid the
+Fetus an additional $4,500 to remain neutral![15]
+
+Before 1750, when the competition for the slaves was less keen, and the
+supply came nearer to meeting the demand, the slavers were probably as
+honest in this as they were in any other trade with the natives. The
+whites encouraged and incited the native tribes to make war upon one
+another for the benefit of the whites. The whites fostered kidnaping,
+slavery and the slave trade. The natives were urged to betray one
+another, and the whites took advantage of their treachery. During the
+four hundred years that the African slave trade was continued, it was
+the whites who encouraged it; fostered it; and backed it financially.
+The slave trade was a white man's trade, carried on under conditions as
+far removed from the conditions of ordinary African life as the
+manufacturing and trading of Europe were removed from the manufacturing
+and trading of the Africans.
+
+
+3. _The Slave Trade_
+
+With the pressing demand from the Americas for a generous supply of
+black slaves, the business of securing them became one of the chief
+commercial activities of the time. "The trade bulked so large in the
+world's commerce in the seventeenth and eighteenth centuries that every
+important maritime community on the Atlantic sought a share, generally
+with the sanction and often with the active assistance of its respective
+sovereign."[16]
+
+The catching, holding and shipping of Negroes on the African coast was
+the means by which the demand for slaves was met. With a few minor
+exceptions, the whites did not engage directly in slave catching. In
+most instances they bought their slaves from native brokers who lived in
+the coast towns. The brokers, in turn, received their slaves from the
+interior, where they were captured during wars, by professional raiding
+parties, well supplied with arms and ammunition. Slave-catching, begun
+as a kidnaping of individuals, developed into a large-scale traffic that
+provided the revenue of the more war-like natives. Villages were
+attacked and burned, and whole tribes were destroyed or driven off to
+the slave-pens on the coast. After 1750, for nearly a hundred years, the
+demand for slaves was so great and the profits were so large that no
+pains were spared to secure them.
+
+The Slave Coast native was compelled to choose between being a
+slave-catcher or a slave. As a slave-catcher he spread terror and
+destruction among his fellows, seized them and sold them to white men.
+As a slave he made the long journey across the Atlantic.
+
+The number of slaves carried away from Africa is variously estimated.
+Claridge states that "the Guinea Coast as a whole supplied as many as
+from 70,000 to 100,000 yearly" in 1700.[17] Bogart estimates the number
+of slaves secured as 2,500 per year in 1700; 15,000 to 20,000 per year
+from 1713 to 1753; in 1771, 47,000 carried by British ships alone; and
+in 1768 the slaves shipped from the African coast numbered 97,000.[18]
+Add to these numbers those who were killed in the raids; those who died
+in the camps, where the mortality was very high, and those who committed
+suicide. The total represents the disturbing influence that the slave
+trade introduced into the native African civilization.
+
+In the early years of the trade the ships were small and carried only a
+few hundred Negroes at most. As the trade grew, larger and faster ships
+were built with galleries between the decks. On these galleries the
+blacks were forced to lie with their feet outboard--ironed together, two
+and two, with the chains fastened to staples in the deck. "They were
+squeezed so tightly together that the average space allowed to each one
+was but 16 inches by five and a half feet."[19] The galleries were
+frequently made of rough lumber, not tightly joined. Later, when the
+trade was outlawed, the slaves were stowed away out of sight on loose
+shelves over the cargo. "Where the 'tween decks space was two feet high
+or more, the slaves were stowed sitting up in rows, one crowded into the
+lap of another, and with legs on legs, like rider on a crowded
+toboggan." (Spears, p. 71.) There they stayed for the weeks or the
+months of the voyage. "In storms the sailors had to put on the hatches
+and seal tight the openings into the infernal cesspool." (Spears, p.
+71.) The odor of a slaver was often unmistakable at a distance of five
+miles down wind.
+
+The terrible revolt of the slaves in the West Indies, beginning in
+1781, gave the growing anti-slavery sentiment an immense impetus. It
+also gave the slave owners pause. The cotton-gin had not yet been
+invented. Slavery was on a shifty economic basis in the South. Great
+Britain passed the first law to limit the slave trade in 1788; the
+United States outlawed the trade in 1794. In 1824 Great Britain declared
+the slave trade piracy. During these years, and during the years that
+followed, until the last slaver left New York Harbor in 1863, the trade
+continued under the American flag, in swift, specially constructed
+American-built ships.
+
+As the restrictions upon the trade became more severe in the face of an
+increasing demand for slaves, "the fitting out of slavers developed into
+a flourishing business in the United States, and centered in New York
+City." _The New York Journal of Commerce_ notes in 1857 that "down-town
+merchants of wealth and respectability are extensively engaged in buying
+and selling African Negroes, and have been, with comparatively little
+interruption for an indefinite number of years." A writer in the
+_Continental Monthly_ for January, 1862, says:--"The city of New York
+has been until of late the principal port of the world for this infamous
+commerce; although the cities of Boston and Portland, are only second to
+her in distinction." During the years 1859-1860 eighty-five slavers are
+reported to have fitted out in New York Harbor and these ships alone had
+a capacity to transport from 30,000 to 60,000 slaves a year.[20]
+
+The merchants of the North pursued the slave trade so relentlessly
+because it paid such enormous profits on the capital outlay. Some of the
+voyages went wrong, but the trade, on the whole, netted immense returns.
+At the end of the eighteenth century a good ship, fitted to carry from
+300 to 400 slaves, could be built for about $35,000. Such a ship would
+make a clear profit of from $30,000 to $100,000 in a single voyage. Some
+of them made as many as five voyages before they became so foul that
+they had to be abandoned.[21] While some voyages were less profitable
+than others, there was no avenue of international trade that offered
+more alluring possibilities.
+
+Sanctioned by potentates, blessed by the church, and surrounded with the
+garments of respectability, the slave trade grew, until, in the words of
+Samuel Hopkins (1787), "The trade in human species has been the first
+wheel of commerce in Newport, on which every other movement in business
+has depended.... By it the inhabitants have gotten most of their wealth
+and riches." (Spears, p. 20.) After the vigorous measures taken by the
+British Government for its suppression, the slave trade was carried on
+chiefly in American-built ships; officered by American citizens; backed
+by American capital, and under the American flag.
+
+The slave trade was the business of the North as slavery was the
+business of the South. Both flourished until the Proclamation of
+Emancipation in 1863.
+
+
+4. _Slavery in the United States_
+
+Slavery and the slave trade date from the earliest colonial times. The
+first slaves in the English colonies were brought to Jamestown in 1619
+by a Dutch ship. The first American-built slave ship was the _Desire_,
+launched at Marblehead in 1636. There were Negro slaves in New York as
+early as 1626, although there were only a few hundred slaves in the
+colonies prior to 1650.
+
+Since slave labor is economical only where the slaves can be worked
+together in gangs, there was never much slavery among the farmers and
+small business men of the North. On the other hand, in the South, the
+developing plantation system made it possible for the owner to use large
+gangs of slaves in the clearing of new land; in the raising of tobacco,
+and in caring for rice and cotton. The plantation system of agriculture
+and the cotton gin made slavery the success that it was in the United
+States. "The characteristic American slave, indeed, was not only a
+Negro, but a plantation workman."[22]
+
+The opening years of the nineteenth century found slavery intrenched
+over the whole territory of the United States that lay South of the
+Mason and Dixon line. In that territory slave trading and slave owning
+were just as much a matter of course as horse trading and horse owning
+were a matter of course in the North. "Every public auctioneer handled
+slaves along with other property, and in each city there were brokers,
+buying them to sell again, and handling them on commission."[23]
+
+The position of the broker is indicated in the following typical bill of
+sale which was published in Charleston, S. C., in 1795. "Gold Coast
+Negroes. On Thursday, the 17th of March instant, will be exposed to
+public sale near the exchange ... the remainder of the cargo of negroes
+imported in the ship _Success_, Captain John Conner, consisting chiefly
+of likely young boys and girls in good health, and having been here
+through the winter may be considered in some degree seasoned to the
+climate."[24]
+
+Such a bill of sale attracted no more attention at that time than a
+similar bill advertising cattle attracts to-day.
+
+During the early colonial days, the slaves were better fed and provided
+for than were the indentured servants. They were of greater money value
+and, particularly in the later years when slavery became the mainstay of
+Southern agriculture, a first class Negro, acclimated, healthy, willing
+and trustworthy, was no mean asset.
+
+Toward the end of the eighteenth century slavery began to show itself
+unprofitable in the South. The best and most accessible land was
+exhausted. Except for the rice plantations of South Carolina and
+Georgia, slavery was not paying. The Southern delegates to the
+Constitutional Convention, with the exception of the delegates from
+these states, were prepared to abolish the slave trade. Some of them
+were ready to free their own slaves. Then came the invention of the
+cotton gin and the rise of the cotton kingdom. The amount of raw cotton
+consumed by England was 13,000 bales in 1781; 572,000 bales in 1820; and
+3,366,000 bales in 1860. During that period, the South was almost the
+sole source of supply.
+
+The attitude of the South, confronted by this wave of slave prosperity,
+underwent a complete change. Her statesmen had consented, between 1808
+and 1820, to severe restrictive laws directed towards the slave trade.
+After cotton became king, slaves rose rapidly in price; land, once used
+and discarded, was again brought under cultivation; cotton-planting
+spread rapidly into the South and Southwest; Texas was annexed; the
+Mexican War was fought; an agitation was begun for the annexation of
+Cuba, and Calhoun (1836) declared that he "ever should regret that this
+term (piracy) had been applied" to the slave trade in our laws.[25]
+
+The change of sentiment corresponded with the changing value of the
+slaves. Phillips publishes a detailed table of slave values in which he
+estimates that an unskilled, able-bodied young slave man was worth $300
+in 1795; $500 to $700 in 1810; $700 to $1200 to in 1840; and $1100 to
+$1800 in 1860.[26] The factors which resulted in the increased slave
+prices were the increased demand for cotton, the increased demand for
+slaves, and the decrease in the importation of negroes due to the
+greater severity of the prohibitions on the slave trade.
+
+
+5. _Slavery for a Race_
+
+The American colonists needed labor to develop the wilderness. White
+labor was scarce and high, so the colonists turned to slave labor
+performed by imported blacks. The merchants of the North built the ships
+and carried on the slave trade at an immense profit. The plantation
+owners of the South exploited the Negroes after they reached the states.
+
+The continuance of the slave trade and the provision of a satisfactory
+supply of slaves for the Southern market depended upon slave-catching in
+Africa, which, in turn, involved the destruction of an entire
+civilization. This work of destruction was carried forward by the
+leading commercial nations of the world. During nearly 250 years the
+English speaking inhabitants of America took an active part in the
+business of enslaving, transporting and selling black men. These
+Americans--citizens of the United States--bought stolen Negroes on the
+African coast; carried them against their will across the ocean; sold
+them into slavery, and then, on the plantations, made use of their
+enforced labor.
+
+Both slavery and the slave trade were based on a purely economic
+motive--the desire for profit. In order to satisfy that desire, the
+American people helped to depopulate villages,--to devastate, burn,
+murder and enslave; to wipe out a civilization, and to bring the
+unwilling objects of their gain-lust thousands of miles across an
+impassable barrier to alien shores.
+
+FOOTNOTES:
+
+[12] "History of the Gold Coast," W. W. Claridge. London, Murray, 1915,
+vol. I, p. 39.
+
+[13] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1908,
+p. 43.
+
+[14] "A History of the Gold Coast," W. W. Claridge. London, Murray,
+1915, vol. I, p. 144.
+
+[15] Ibid., p. 150.
+
+[16] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+p. 20.
+
+[17] "History of the Gold Coast," W. W. Claridge. London, Murray, 1915,
+vol. I, p. 172.
+
+[18] "Economic History of the U. S.," E. L. Bogart. New York, Longmans,
+1910 ed., p. 84-5.
+
+[19] "The American Slave Trade," J. R. Spears. New York, Scribners,
+1901, p. 69.
+
+[20] "The Suppression of the American Slave Trade," W. E. B. DuBois. New
+York, Longmans, 1896, p. 178-9.
+
+[21] "The American Slave Trade," J. R. Spears. New York, Scribners,
+1901, p. 84-5.
+
+[22] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+p. VII.
+
+[23] Ibid., p. 190.
+
+[24] Ibid., p. 40.
+
+[25] Benton, "Abridgment of Debates." XII, p. 718.
+
+[26] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+p. 370.
+
+
+
+
+V. THE WINNING OF THE WEST
+
+
+1. _Westward, Ho!_
+
+The English colonists in America occupied only the narrow strip of
+country between the Alleghanies and the Atlantic Ocean. The interior was
+inhabited by the Indians, and claimed by the French, the Spanish and the
+British, but neither possession nor legal title carried weight with the
+stream of pioneers that was making a path into the "wilderness," crying
+its slogan,--"Westward, Ho!" as it moved toward the setting sun. The
+first objective of the pioneers was the Ohio Valley; the second was the
+valley of the Mississippi; the third was the Great Plains; the fourth
+was the Pacific slope, with its golden sands. Each one of these
+objectives developed itself out of the previous conquest.
+
+The settlers who made their way across the mountains into the valley of
+the Ohio, found themselves in a land of plenty. The game was abundant;
+the soil was excellent, and soon they were in a position to offer their
+surplus products for sale. These products could not be successfully
+transported across the mountains, but they could be floated down the
+Ohio and the Mississippi--a natural roadway to the sea. But beside the
+Indians, who claimed all of the land for their own, there were the
+Spaniards at New Orleans, doing everything in their power to prevent the
+American Colonists from building up a successful river commerce.
+
+The frontiersmen were able to push back the Indians. The Spanish
+garrisons presented a more serious obstacle. New Orleans was a well
+fortified post that could be provisioned from the sea. Behind it,
+therefore, lay the whole power of the Spanish fleet. The right of
+navigation was finally obtained in the Treaty of 1795. Still friction
+continued with the Spanish authorities and serious trouble was averted
+only by the transfer of Louisiana, first to the French (1800) and then
+by them to the United States (1803). Napoleon had agreed, when he
+secured this territory from the Spaniards, not to turn it over to the
+United States. A pressing need of funds, however, led him to strike an
+easy bargain with the American government which was negotiating for the
+control of the mouth of the Mississippi. Napoleon insisted that the
+United States take, not only the mouth of the river, but also the
+territory to the West which he saw would be useless without this outlet.
+After some hesitation, Jefferson and his advisers accepted the offer and
+the Louisiana Purchase was consummated.
+
+The Louisiana Purchase gave the young American nation what it needed--a
+place in the sun. The colonists had taken land for their early
+requirements from the Indians who inhabited the coastal plain. They had
+enslaved the Negroes and thus had secured an ample supply of cheap
+labor. Now, the pressure of population, and the restless, pioneer spirit
+of those early days, led out into the West.
+
+Until 1830 immigration was not a large factor in the increase of the
+colonial population, but the birth-rate was prodigious. In the closing
+years of the eighteenth century, Franklin estimated that the average
+family had eight children. There were sections of the country where the
+population doubled, by natural increase, once in 23 years. Indeed, the
+entire population of the United States was increasing at a phenomenal
+rate. The census of 1800 showed 5,308,483 persons in the country. Twenty
+years later the population was 9,638,453--an increase of 81 per cent. By
+1840 the population was reported as 17,069,453--an increase of 77 per
+cent over 1820, and of 221 per cent over 1800.
+
+The small farmers and tradesmen of the North were settling up the
+Northwest Territory. The plantation owners of the South, operating on a
+large scale, and with the wasteful methods that inevitably accompany
+slavery, were clamoring for new land to replace the tracts that had
+been exhausted by constant recropping with no attempt at fertilization.
+
+Cotton had been enthroned in the South since the invention of the cotton
+gin in 1792. With the resumption of European trade relations in 1815 the
+demand for cotton and for cotton lands increased enormously. There was
+one, and only one logical way to meet this demand--through the
+possession of the Southwest.
+
+
+2. _The Southwest_
+
+The pioneers had already broken into the Southwest in large numbers.
+While Spain still held the Mississippi, there were eager groups of
+settlers pressing against the frontier which the Spanish guarded so
+jealously against all comers. The Louisiana Purchase met the momentary
+demand, but beyond the Louisiana Purchase, and between the settlers and
+the rich lands of Texas lay the Mexican boundary. The tide of migration
+into this new field hurled itself against the Mexican border in the same
+way that an earlier generation had rolled against the frontier of
+Louisiana.
+
+The attitude of these early settlers is described with sympathetic
+accuracy by Theodore Roosevelt. "Louisiana was added to the United
+States because the hardy backwoods settlers had swarmed into the valleys
+of the Tennessee, the Cumberland and the Ohio by hundreds of
+thousands.... Restless, adventurous, hardy, they looked eagerly across
+the Mississippi to the fertile solitudes where the Spaniard was the
+nominal, and the Indian the real master; and with a more immediate
+longing they fiercely coveted the Creole provinces at the mouth of the
+river."[27] This fierce coveting could have only one possible
+outcome--the colonists got what they wanted.
+
+The speed with which the Southwest rushed into prominence as a factor
+in national affairs is indicated by its contribution to the cotton-crop.
+In 1811 the states and territories from Alabama and Tennessee westward
+produced one-sixteenth of the cotton grown in the United States. In 1820
+they produced a third; in 1830, a half; and by 1860, three-quarters of
+the cotton raised. At the same time, the population of the
+Alabama-Mississippi territory was:--
+
+
+       200,000 in 1810.
+       445,000 in 1820.
+       965,000 in 1830.
+     1,377,000 in 1840.
+
+
+Thus thirty years saw an increase of nearly seven-fold in the population
+of this region.[28]
+
+Meanwhile, slavery had become the issue of the day. The slave power was
+in control of the Federal Government, and in order to maintain its
+authority, it needed new slave states to offset the free states that
+were being carved out of the Northwest.
+
+Here were three forces--first the desire of the frontiersmen for "elbow
+room"; second the demand of King Cotton for unused land from which the
+extravagant plantation system might draw virgin fertility and third, the
+necessity that was pressing the South to add territory in order to hold
+its power. All three forces impelled towards the Southwest, and it was
+thither that population pressed in the years following 1820.
+
+
+3. _Texas_
+
+Mexico lay to the Southwest, and therefore Mexico became the object of
+American territorial ambitions. The district now known as Texas had
+constituted a part of the Louisiana Purchase (1803); had been ceded to
+Spain (1819); had been made the object of negotiations looking towards
+its purchase in 1826; had revolted against Mexico and been recognized
+as an independent state in 1835.
+
+Texas had been settled by Americans who had secured the permission of
+the Mexican Government to colonize. These settlers made no effort to
+conceal their opposition to the Mexican Government, with which they were
+entirely out of sympathy. Many of them were seeking territory in which
+slavery might be perpetuated, and they introduced slaves into Texas in
+direct violation of the Mexican Constitution. The Americans did not go
+to Texas with any idea of becoming Mexican subjects; on the contrary, as
+soon as they felt themselves strong enough, they declared their
+independence of Mexico, and began negotiations for the annexation of
+Texas to the United States.
+
+The Texan struggle for independence from Mexico was cordially welcomed
+in all parts of the United States, but particularly in the South.
+Despite the protests of Mexico, public meetings were held; funds were
+raised; volunteers were enlisted and equipped, and supplies and
+munitions were sent for the assistance of the Texans in ships openly
+fitted out in New Orleans.
+
+No sooner had the Texans established a government than the campaign for
+annexation was begun. The advocates of annexation--principally
+Southerners--argued in favor of adding so rich and so logical a prize to
+the territory of the United States, citing the purchase of Louisiana and
+of Florida as precedents. Their opponents, first on constitutional
+grounds and then on grounds of public policy, argued against annexation.
+
+Opinion in the South was greatly aroused. Despite the fact that many of
+her foremost statesmen were against annexation, some of the Southern
+newspapers even went so far as to threaten the dissolution of the Union
+if the treaty of ratification failed to pass the Senate.
+
+The campaign of 1844 was fought on the issue of annexation and the
+election of James K. Polk was a pledge that Texas should be annexed to
+the United States. During the campaign, the line of division on
+annexation had been a party line--Democrats favoring; Whigs opposing.
+Between the election and the passage of the joint resolution by which
+annexation was consummated, it became a sectional issue,--Southern Whigs
+favoring annexation and Northern Democrats opposing it.
+
+So strong was the protest against annexation, that the treaty could not
+command the necessary two-thirds vote in the Senate. The matter was
+disposed of by the passage of a joint resolution (March 1, 1845) which
+required only a majority vote in both houses of Congress. President Polk
+therefore took office with the mandate of the country and the decision
+of both houses of the retiring Congress, in favor of annexation.
+
+Mexico, in the meantime, had offered to recognize the independence of
+Texas and to make peace with her if the Texas Congress would reject the
+joint resolution, and refuse the proffered annexation. This the Texas
+Congress refused, and with the passage, by that body, of an act
+providing for annexation, the Mexican minister was withdrawn from
+Washington, and Mexico began her preparations for war.
+
+President Polk had taken office with the avowed intention of buying
+California from Mexico. The rupture threatened to prevent him from
+carrying this plan into effect. He therefore sent an unofficial
+representative to Mexico in an effort to restore friendly relations.
+Failing in that, he and his advisers determined upon war as the only
+feasible method of obtaining California and of settling the diplomatic
+tangle involved in the annexation of Texas.
+
+
+4. _The Conquest of Mexico_
+
+The Polk Administration made the Mexican War as a part of its
+expansionist policy.
+
+"Although that unfortunate country (Mexico) had officially notified the
+United States that the annexation of Texas would be treated as a cause
+of war, so constant were the internal quarrels in Mexico that open
+hostilities would have been avoided had the conduct of the
+Administration been more honorable. That was the opinion of Webster,
+Clay, Calhoun, Benton, and Tyler.... Mexico was actually goaded on to
+war. The principle of the manifest destiny of this country was invoked
+as a reason for the attempt to add to our territory at the expense of
+Mexico."[29]
+
+After the annexation of Texas it became the duty of the United States to
+defend that state against the threatened Mexican invasion.
+
+Mexican troops had occupied the southern bank of the Rio Grande. General
+Zachary Taylor with a small force, moved to a position on the Nueces
+River. Between the two rivers lay a strip of territory the possession of
+which was one of the sources of dispute between Mexico and Texas. What
+followed may be stated in the words of one of the officers who
+participated in the expedition: "The presence of the United States
+troops on the edge of the territory farthest from the Mexican
+settlements was not sufficient to provoke hostilities. We were sent to
+provoke a fight, but it was essential that Mexico begin it" (p. 41).
+"Mexico showing no willingness to come to the Nueces to drive the
+invaders from her soil, it became necessary for the 'invaders' to
+approach to within a convenient distance to be struck. Accordingly,
+preparations were begun for moving the army to the Rio Grande, to a
+point near Matamoras. It was desirable to occupy a position near the
+largest center of population possible to reach without actually invading
+territory to which we set up no claim whatever" (p. 45).[30]
+
+The occupation, by the United States troops, of the disputed territory
+soon led to a clash in which several United States soldiers were killed.
+The incident was taken by the President as a sufficient cause for the
+declaration of a state of war. The House complied readily with his
+wishes, passing the necessary resolution. Several members of the Senate
+begged for a delay during which the actual state of affairs might be
+ascertained. The President insisted, however, and the war was declared
+(May 13, 1846).
+
+The declaration of war was welcomed with wild enthusiasm in the South.
+Meetings were called; funds were raised; volunteers were enlisted,
+equipped and despatched in all haste to the scene of the conflict.
+
+The North was less eager. There were protests, petitions,
+demonstrations. Many of the leaders of northern opinion took a public
+stand against the war. But the news of the first victories sent the
+country mad with an enthusiasm in which the North joined the South.
+
+The United States troops, during the Mexican War, won brilliant--almost
+unbelievable successes--against superior forces and in the face of
+immense natural obstacles. Had the war been less of a military triumph
+there must have been a far more widely-heard protest from Polk's enemies
+in the North. Successful beyond the wildest dreams of its promoters, the
+victorious war carried its own answer to those who questioned the
+worthiness of the cause. Within two years, the whole of Mexico was under
+the military control of the United States, and that country was in a
+position to dictate its own terms.
+
+The demands of the United States were mild to the extent of generosity.
+Under the treaty the annexation of Texas was validated; New Mexico and
+Upper California were ceded to the United States; the lower Rio Grande
+was fixed as the southern boundary of Texas, and in considerations of
+these additions to its territory, the United States agreed to pay Mexico
+fifteen millions of dollars.
+
+Under this plan, Mexico was paid for territory that she did not need and
+could not use, while the United States gave a money consideration for
+the title to land that was already hers by right of conquest, and of
+which she was in actual possession.
+
+The details of the treaty are relatively unimportant. The outstanding
+fact is that Mexico was in possession of certain territory that the
+ruling power in the United States wanted, and that ruling power took
+what it wanted by force of arms. "The war was one of conquest in the
+interest of an institution." It was "one of the most unjust ever waged
+by a stronger against a weaker nation."[31]
+
+Congressman A. P. Gardner of Massachusetts summarized the matter very
+pithily in his debate with Morris Hillquit (New York, April 2, 1915),
+"We assisted Texas to get away from Mexico and then we proceeded to
+annex Texas. Plainly and bluntly stated, our purpose was to get some
+territory for American development." (Stenographic report in the _New
+York Call_, April 11, 1915.)
+
+
+5. _Conquering the Conquered_
+
+The work of conquering the Southwest was not completed by the
+termination of the war. Mexico ceded the territory--in the neighborhood
+of a million square miles--but she was giving away something that she
+had never possessed. Mexico claimed title to land that was occupied by
+the Indians. She had never conquered it; never settled it; never
+developed it. Her sovereignty was of the same shadowy sort that Spain
+had exercised over the country before the Mexican revolution.
+
+The new owners of the Southwest had a very different purpose in mind. No
+empty title would satisfy them. They intended to use the land. The
+Indians--already in possession--resented the encroachments of the
+invaders, but they fared no better than the Mexicans, or than their
+red-skinned brothers who had contended for the right to fish and hunt
+along their home streams in the Appalachians. The Indians of the
+Southwest fought stubbornly, but the wars that meant life and death to
+them were the merest pastime for an army that had just completed the
+humiliation of a nation of the size and strength of Mexico. The Indians
+were swept aside, and the country was opened to the trapper, the
+prospector, the trader and the settler.
+
+The Mexican War was a slight affair, involving a relatively small outlay
+in men and money. The total number of American soldiers killed in the
+war was 1,721; the wounded were 4,102; the deaths from accident and
+disease were 11,516, making total casualties of 5,823 and total losses
+of 15,618.[32]
+
+The money cost of the Mexican War--the army and navy appropriations for
+the years 1846 to 1849 inclusive--was $119,624,000. Obviously the net
+cost of the war was less than this gross total,--how much less it is
+impossible to say.
+
+No satisfactory figures are available to show the cost in men and money
+of the Indian Wars in the Southwest. "From 1849 to 1865, the government
+expended $30,000,000 in the subjugation of the Indians in the
+territories of New Mexico and Arizona."[33] Their character may be
+gauged by noting from the "Historical Register" (Vol. 2, p. 281-2) the
+losses sustained in the four Indian Wars of which a record is preserved.
+In the Northwest Indian Wars (1790 to 1795) 896 persons were killed and
+436 were wounded; in the Seminole War (1817 to 1818) 46 were killed and
+36 were wounded; in the Black Hawk War (1831-2) the killed were 26 and
+the wounded 39; in the Seminole War (1835-1842) 383 were killed and 557
+wounded. These were among the most serious of the Indian Wars and in all
+of them the cost in life and limb was small. Judged on this standard,
+the losses in the Southwest, during the Indian Wars, were, at most,
+trifling. The total outlay that was involved in the conquest of the vast
+domain would not have covered one first class battle of the Great War,
+and yet this outlay added to the territory of the United States
+something like a million square miles containing some of the richest and
+most productive portions of the earth's surface.
+
+This domain was won by a process of military conquest; it was taken from
+the Mexicans and the Indians by force of arms. In order to acquire it,
+it was necessary to drive whole tribes from their villages; to burn; to
+maim; to kill. "St. Louis, New Orleans, St. Augustine, San Antonio,
+Santa Fe and San Francisco are cities that were built by Frenchmen and
+Spaniards; we did not found them but we conquered them." "The Southwest
+was conquered only after years of hard fighting with the original
+owners" (p. 26). "The winning of the West and the Southwest is a stage
+in the conquest of a continent" (p. 27). "This great westward movement
+of armed settlers was essentially one of conquest, no less than of
+colonization" (p. 370).[34] None of the possessors of this territory
+were properly armed or equipped for effective warfare. All of them fell
+an easy prey to the organized might of the Government of the United
+States.
+
+FOOTNOTES:
+
+[27] "The Winning of the West," Theodore Roosevelt. New York, Putnam's,
+1896, vol. 4, p. 262.
+
+[28] "American Negro Slavery," U. B. Phillips. New York, Appleton, 1918,
+pp. 171-2.
+
+[29] "History of the United States," James F. Rhoades. New York,
+Macmillan, 1906, vol. I, p. 87.
+
+[30] "Personal Memoirs," U. S. Grant. New York, Century, 1895, vol. I.
+
+[31] "Personal Memoirs," U. S. Grant. New York, Century, 1895, vol. I,
+pp. 115 and 32.
+
+[32] "Historical Register of the United States Army," F. B. Heitman.
+Washington, Govt. Print., vol. 2, p. 282.
+
+[33] "The Story of New Mexico," Horatio O. Ladd. Boston, D. Lothrop Co.,
+1891, p. 333.
+
+[34] "The Winning of the West," Theodore Roosevelt. Vol. I, p. 26, 27,
+and Vol. II, p. 370.
+
+
+
+
+VI. THE BEGINNINGS OF WORLD DOMINION
+
+
+1. _The Shifting of Control_
+
+During the half century that intervened between the War of 1812 and the
+Civil War of 1861 the policy of the United States government was decided
+largely by men who came from south of the Mason and Dixon line. The
+Southern whites,--class-conscious rulers with an institution (slavery)
+to defend,--acted like any other ruling class under similar
+circumstances. They favored Southward expansion which meant more
+territory in which slavery might be established.
+
+The Southerners were looking for a place in the sun where slavery, as an
+institution, might flourish for the profit and power of the
+slave-holding class. Their most effective move in this direction was the
+annexation of Texas and the acquisition of territory following the
+Mexican War. An insistent drive for the annexation of Cuba was cut short
+by the Civil War.
+
+Southern sentiment had supported the Louisiana Purchase of 1803 and the
+Florida Purchase of 1819. From Jefferson's time Southern statesmen had
+been advocating the purchase of Cuba. Filibustering expeditions were
+fitted out in Southern ports with Cuba as an objective; agitation was
+carried on, inside and outside of Congress; between 1850 and 1861 the
+acquisition of Cuba was the question of the day. It was an issue in the
+Campaign of 1853. In 1854 the American ministers to London, France and
+Madrid met at the direction of the State Department and drew up a
+document (the "Ostend Manifesto") dealing with the future of Cuba.
+McMaster summarizes the Manifesto in these words: "The United States
+ought to buy Cuba because of its nearness to our coast; because it
+belonged naturally to that great group of states of which the Union was
+the providential nursery; because it commanded the mouth of the
+Mississippi whose immense and annually growing trade must seek that way
+to the ocean, and because the Union could never enjoy repose, could
+never be secure, till Cuba was within its boundaries." (Vol. viii, pp.
+185-6.) If Spain refused to sell Cuba it was suggested that the United
+States should take it.
+
+The Ostend Manifesto was rejected by the State Department, but it was a
+good picture of the imperialistic sentiment at that time abroad among
+certain elements in the United States.
+
+The Cuban issue featured in the Lincoln-Douglas Debates in 1858. It was
+hotly discussed by Congress in 1859. Only twenty years had passed since
+the United States, by force of arms, had taken from Mexico territory
+that she coveted. Now it was proposed to appropriate territory belonging
+to Spain.
+
+The outbreak of hostilities deferred the project, and when the Civil War
+was over, the slave power was shattered. From that time forward national
+policy was guided by the leaders of the new industrial North.
+
+The process of this change was fearfully wasteful. The shifting of power
+from the old regime to the new cost more lives and a greater expenditure
+of wealth than all of the wars of conquest that had been fought during
+the preceding half century.
+
+The change was complete. The slaves were liberated by Presidential
+Proclamation. The Southern form of civilization--patriarchal and
+feudal--disappeared, and upon its ruins--rapidly in the West; slowly in
+the South--there arose the new structure of an industrial civilization.
+
+The new civilization had no need to look outward for economic advantage.
+Forest tracts, mineral deposits and fertile land afforded ample
+opportunity at home. It was three thousand miles to the Pacific and at
+the end of the journey there was gold! The new civilization therefore
+turned its energies to the problem of subduing the continent and of
+establishing the machinery necessary to provide for its vastly
+increasing needs. A small part of the capital required for this purpose
+came from abroad. Most of it was supplied at home. But the events
+involved in opening up the territory west of the Rockies, of spanning
+the country with steel, and providing outlets for the products of the
+developing industries were so momentous that even the most ambitious
+might fulfill his dreams of conquest without setting foot on foreign
+soil. Territorial aggrandizement was forgotten, and men turned with a
+will to the organization of the East and the exploration and development
+of the West.
+
+The leaders of the new order found time to take over Alaska (1868) with
+its 590,884 square miles. The move was diplomatic rather than economic,
+however, and it was many years before the huge wealth of Alaska was even
+suspected.
+
+
+2. _Hawaii_
+
+The new capitalist interests began to feel the need of additional
+territory toward the end of the nineteenth century. The desirable
+resources of the United States were largely in private hands and most of
+the available free land had been pre-empted. Beside that, there were
+certain interests, like sugar and tobacco, that were looking with
+longing eyes toward the tempting soil and climate of Hawaii, Porto Rico
+and Cuba.
+
+When the South had advocated the annexation of Texas, its statesmen had
+been denounced as expansionists and imperialists. The same fate awaited
+the statesmen of the new order who were favoring the extension of United
+States territory to include some of the contiguous islands that offered
+special opportunities for certain powerful financial interests.
+
+The struggle began over the annexation of Hawaii. After numerous
+attempts to annex Hawaii to the United States a revolution was finally
+consummated in Honolulu in 1893. At that time, under treaty provisions,
+the neutrality of Hawaii was guaranteed by the United States. Likewise,
+"of the capital invested in the islands, two-thirds is owned by
+Americans." This statement is made in "Address by the Hawaiian Branches
+of the Sons of the American Revolution, the Sons of Veterans, and the
+Grand Army of the Republic to their compatriots in America Concerning
+the Annexation of Hawaii." (1897.) These advocates of annexation state
+in the same address that: "The revolution (of 1893) was not the work of
+filibusterers and adventurers, but of the most conservative and
+law-abiding citizens, of the principal tax-payers, the leaders of
+industrial enterprises, etc." The purpose behind the revolution seemed
+clear. Certain business men who had sugar and other products to sell in
+the United States, believed that they would gain, financially, by
+annexation. They engineered the revolution of 1893 and they were
+actively engaged in the agitation for annexation that lasted until the
+treaty of annexation was confirmed by the United States in 1898. The
+matter was debated at length on the floor of the United States Senate,
+and an investigation revealed the essential facts of the case.
+
+The immediate cause of the revolution in 1893 was friction over the
+Hawaiian Constitution. After some agitation, a "Committee of Safety" was
+organized for the protection of life and property on the islands.
+Certain members of the Hawaiian government were in favor of declaring
+martial law, and dealing summarily with the conspirators. The Queen
+seems to have hesitated at such a course because of the probable
+complications with the government of the United States.
+
+The _U. S. S. Boston_, sent at the request of United States Minister
+Stevens to protect American life and property in the Islands, was lying
+in the harbor of Honolulu. After some negotiations between the
+"Committee of Safety" and Minister Stevens, the latter requested the
+Commander of the _Boston_ to land a number of marines. This was done on
+the afternoon of January 16, 1893. Immediately the Governor of the
+Island of Oahu and the Minister of Foreign Affairs addressed official
+communications to the United States Minister, protesting against the
+landing of troops "without permission from the proper authorities."
+Minister Stevens replied, assuming full responsibility.
+
+On the day following the landing of the marines, the Committee of
+Safety, under the chairmanship of Judge Dole, who had resigned as
+Justice of the Supreme Court of Hawaii in order to accept the
+Chairmanship of the Committee, proceeded to the government building, and
+there, under cover of the guns of the United States Marines, who were
+drawn up for the purpose of protecting the Committee against possible
+attack, a proclamation was read, declaring the abrogation of the
+Hawaiian monarchy, and the establishment of a provisional government "to
+exist until terms of union with the United States have been negotiated
+and agreed upon." Within an hour after the reading of this proclamation,
+and while the Queen and her government were still in authority, and in
+possession of the Palace, the Barracks, and the Police Station, the
+United States Minister gave the Provisional Government his recognition.
+
+The Queen, who had 500 soldiers in the Barracks, was inclined to fight,
+but on the advice of her counselors, she yielded "to the superior force
+of the United States of America" until the facts could be presented at
+Washington, and the wrong righted.
+
+Two weeks later, on the first of February, Minister Stevens issued a
+proclamation declaring a protectorate over the islands. This action was
+later repudiated by the authorities at Washington, but on February 15,
+President Harrison submitted a treaty of annexation to the Senate. The
+treaty failed of passage, and President Cleveland, as one of his first
+official acts, ordered a complete investigation of the whole affair.
+
+The Senate Committee on Foreign Relations submitted a report on the
+matter February 26, 1894. Four members referred to the acts of Minister
+Stevens as "active, officious and unbecoming participation in the events
+which led to the revolution." All members of the committee agreed that
+his action in declaring a protectorate over the Islands was unjustified.
+
+The same kind of a fight that developed over the annexation of Texas now
+took place over the annexation of Hawaii. A group of senators, of whom
+Senator R. F. Pettigrew was the most conspicuous figure, succeeded in
+preventing the ratification of the annexation treaty until July 7, 1898.
+Then, ten weeks after the declaration of the Spanish-American War, under
+the stress of the war-hysteria, Hawaii was annexed by a joint resolution
+of Congress.
+
+The Annexation of Hawaii marks a turning point in the history of the
+United States. For the first time, the American people secured
+possession of territory lying outside of the mainland of North America.
+For the first time the United States acquired territory lying within the
+tropics. The annexation of Hawaii was the first imperialistic act after
+the annexation of Texas, more than fifty years before. It was the first
+imperialistic act since the capitalists of the North had succeeded the
+slave-owners of the South as the masters of American public life.
+
+
+3. _The Spanish-American War_
+
+The real test of the imperial intentions of the United States came with
+the Spanish-American War. An old, shattered world empire (Spain) held
+Porto Rico, Cuba and the Philippines. Porto Rico and Cuba were of
+peculiar value to the sugar and tobacco interests of the United States.
+They were close to the mainland, they were enormously productive and,
+furthermore, Cuba contained important deposits of iron ore.
+
+Spain had only a feeble grip on her possessions. For years the natives
+of Cuba and of the Philippines had been in revolt against the Spanish
+power. At times the revolt was covert. Again it blazed in the open.
+
+The situation in Cuba was rendered particularly critical because of the
+methods used by the Spanish authorities in dealing with the rebellious
+natives. The Spaniards were simply doing what any empire does to
+suppress rebellion and enforce obedience, but the brutalities of
+imperialism, as practiced in Cuba by the Spaniards, gave the American
+interventionists their opportunity. Day after day the newspapers carried
+front page stories of Spanish atrocities in Cuba. Day after day the
+ground was prepared for open intervention in the interests of the
+oppressed Cubans. There was more than grim humor in the instructions
+which a great newspaper publisher is reported to have sent his
+cartoonist in Cuba,--"You provide the pictures; we'll furnish the war."
+
+The conflict was precipitated by the blowing up of the United States
+battleship _Maine_ as she lay in the harbor of Havana (February 15,
+1898). It has not been settled to this day whether the _Maine_ was blown
+up from without or within. At the time it was assumed that the ship was
+blown up by the Spanish, although "there was no evidence whatever that
+any one connected with the exercise of Spanish authority in Cuba had had
+so much as guilty knowledge of the plans made to destroy the _Maine_"
+(p. 270), and although "toward the last it had begun to look as if the
+Spanish Government were ready, rather than let the war feeling in the
+United States put things beyond all possibility of a peaceful solution,
+to make very substantial concessions to the Cuban insurgents and bring
+the troubles of the Island to an end" (p. 273-4).[35]
+
+Congress, in a joint resolution passed April 20, 1898, declared that
+"the people of the Island of Cuba are, and of right ought to be, free
+and independent.... The United States hereby disclaims any intention to
+exercise sovereignty, jurisdiction or control over said island except
+for the pacification thereof, and asserts its determination, when that
+is accomplished, to leave the government and control of the island to
+its people."
+
+The war itself was of no great moment. There was little fighting on
+land, and the naval battles resulted in overwhelming victories for the
+American Navy. The treaty, ratified February 6, 1899, provided that
+Spain should cede to the United States Guam, Porto Rico, Cuba and the
+Philippines, and that the United States should pay to Spain twenty
+millions of dollars. As in the case of the Mexican War, the United
+States took possession of the territory and then paid a bonus for a
+clear title.
+
+The losses in the war were very small. The total number of men who were
+killed in action and who died of wounds was 289; while 3,949 died of
+accidents and disease. ("Historical Register," Vol. 2, p. 187.) The cost
+of the war was comparatively slight. Hostilities lasted from April 21,
+1898 to August 12, 1898. The entire military and naval expense for the
+year 1898 was $443,368,000; for the year 1899, $605,071,000. Again the
+need for a larger place in the sun had been felt by the people of the
+United States and again the United States had won immense riches with a
+tiny outlay in men and money.
+
+Now came the real issue,--What should the United States do with the
+booty?
+
+There were many who held that the United States was bound to set the
+peoples of the conquered territory free. To be sure the specific pledge
+contained in the joint resolution of April 20, 1898, applied to Cuba
+alone, but, it was argued, since the people of the Philippines had also
+been fighting for liberty, and since they had come so near to winning
+their independence from the Spaniards, they were likewise entitled to
+it.
+
+On the other hand, the advocates of annexation insisted that it was the
+duty of the United States to accept the responsibilities (the "white
+man's burden") that the acquisition of these islands involved.
+
+As President McKinley put it:--"The Philippines, like Cuba and Porto
+Rico, were entrusted to our hands by the providence of God." (President
+McKinley, Boston, February 16, 1899.) How was the country to avoid such
+a duty?
+
+Thus was the issue drawn between the "imperialists" and the
+"anti-imperialists."
+
+The imperialists had the machinery of government, the newspapers, and
+the prestige of a victorious and very popular war behind them. The
+anti-imperialists had half a century of unbroken tradition; the accepted
+principles of self-government; the sayings of men who had organized the
+Revolution of 1776; written the Declaration of Independence; held
+exalted offices and piloted the nation through the Civil War.
+
+The imperialists used their inside position. The anti-imperialists
+appealed to public opinion. They organized a league "to aid in holding
+the United States true to the principles of the Declaration of
+Independence. It seeks the preservation of the rights of the people as
+guaranteed to them by the Constitution. Its members hold self-government
+to be fundamental, and good government to be but incidental. It is its
+purpose to oppose by all proper means the extension of the sovereignty
+of the United States over subject peoples. It will contribute to the
+defeat of any candidate or party that stands for the forcible
+subjugation of any people." (From the declaration of principle printed
+on the literature in 1899 and 1900.) Anti-imperialist conferences were
+held in New York, Philadelphia, Chicago, Indianapolis, Boston and other
+large cities. The League claimed to have half a million members. An
+extensive pamphlet literature was published, and every effort was made
+to arouse the people of the country to the importance of the decision
+that lay before them.
+
+The imperialists said a great deal less than their opponents, but they
+were more effective in their efforts. The President had said, in his
+message to Congress (April 1, 1898), "I speak not of forcible
+annexation, for that cannot be thought of. That, by our code of morals,
+would be criminal aggression." The phrase was seized eagerly by those
+who were opposing the annexation of the Spanish possessions. After the
+war with Spain had begun, the President changed front on the ground that
+destiny had placed a responsibility upon the American people that they
+could not shirk. Taking this view of the situation, the President had
+only one course open to him--to insist upon the annexation of the
+Philippines, Porto Rico and Guam. This was the course that was followed,
+and on April 11, 1899, these territories were officially incorporated
+into the United States.
+
+Senator Hoar, in a speech on January 9, 1899, put the issue squarely. He
+described it as "a greater danger than we have encountered since the
+Pilgrims landed at Plymouth--the danger that we are to be transformed
+from a republic, founded on the Declaration of Independence, guided by
+the counsels of Washington, into a vulgar, commonplace empire, founded
+upon physical force."
+
+Cuba remained to be disposed of. With the specific guarantee of
+independence contained in the joint resolution passed at the outbreak of
+the war, it seemed impossible to do otherwise than to give the Cubans
+self-government. Many influential men lamented the necessity, but it was
+generally conceded. But how much independence should Cuba have? That
+question was answered by the passage of the Cuban Treaty with the "Platt
+Amendment" attached. Under the treaty as ratified the United States does
+exercise "sovereignty, jurisdiction and control" over the island.
+
+
+4. _The Philippines_
+
+The territory acquired from Spain was now, in theory, disposed of.
+Practically, the Philippines remained as a source of difficulty and even
+of political danger.
+
+The people of Cuba were, apparently, satisfied. The Porto Ricans had
+accepted the authority of the United States without question. But the
+Filipinos were not content. If the Cubans were to have self-government,
+why not they?
+
+The situation was complicated by the peculiar relations existing between
+the Filipinos and the United States Government. Immediately after the
+declaration of war with Spain the United States Consul-General at
+Singapore had cabled to Admiral Dewey at Hong Kong that Aguinaldo,
+leader of the insurgent forces in the Philippines, was then at
+Singapore, and was ready to go to Hong Kong. Commodore Dewey cabled back
+asking Aguinaldo to come at once to Hong Kong. Aguinaldo left Singapore
+on April 26, 1898, and, with seventeen other revolutionary Filipino
+chiefs, was taken from Hong Kong to Manila in the United States naval
+vessel _McCulloch_. Upon his arrival in Manila, he at once took charge
+of the insurgents.
+
+For three hundred years the inhabitants of the Philippines had been
+engaged in almost incessant warfare with the Spanish authorities. In the
+spring of 1898 they were in a fair way to win their independence. They
+had a large number of men under arms--from 20,000 to 30,000; they had
+fought the Spanish garrisons to a stand-still, and were in practical
+control of the situation.
+
+Aguinaldo was furnished with 4,000 or 5,000 stands of arms by the
+American officials, he took additional arms from the Spaniards and he
+and his people cooperated actively with the Americans in driving the
+Spanish out of Luzon. The Filipino army captured Iloilo, the second
+largest city in the Philippines, without the assistance of the
+Americans. On the day of the surrender of Manila, 15-1/2 miles of the
+surrounding line was occupied by the Filipinos and 600 yards by the
+American troops. Throughout the early summer, the relations between the
+Filipinos and the Americans continued to be friendly. General Anderson,
+in command of the American Army, wrote a letter to the commander of the
+Filipinos (July 4, 1898) in which he said,--"I desire to have the most
+amicable relations with you and to have you and your people cooperate
+with us in military operations against the Spanish forces." During the
+summer the American officers called upon the Filipinos for supplies and
+information and accepted their cooperation. Aguinaldo, on his part,
+treated the Americans as deliverers, and in his proclamations referred
+to them as "liberators" and "redeemers."
+
+The Filipinos, at the earliest possible moment, organized a government.
+On June 18 a republic was proclaimed; on the 23rd the cabinet was
+announced; on the 27th a decree was published providing for elections,
+and on August 6th an address was issued to foreign governments,
+announcing that the revolutionary government was in operation, and was
+in control of fifteen provinces.
+
+The real intent of the Americans was foreshadowed in the instructions
+handed by President McKinley to General Wesley Merritt on May 19, 1898.
+General Merritt was directed to inform the Filipinos that "we come not
+to make war upon the people of the Philippines, nor upon any party or
+faction among them, but to protect them in their homes, in their
+employments, and in their personal and religious rights. Any persons
+who, either by active aid or by honest submission, cooperate with the
+United States in its effort to give effect to this beneficent purpose,
+will receive the reward of its support and protection."
+
+The Filipinos sent a delegation to Paris to lay their claims for
+independence before the Peace Commission. Meeting with no success, they
+visited Washington, with no different result. They were not to be free!
+
+On September 8, 1898, General Otis, commander of the American forces in
+the Philippines, notified Aguinaldo that unless he withdrew his forces
+from Manila and its suburbs by the 15th "I shall be obliged to resort to
+forcible action." On January 5, 1899, by Presidential Proclamation,
+McKinley ordered that "The Military Government heretofore maintained by
+the United States in the city, harbor, and bay of Manila is to be
+extended with all possible dispatch to the whole of the ceded
+territory." On February 4, 1899, General Otis reported "Firing upon the
+Filipinos and the killing of one of them by the Americans, leading to
+return fire." (Report up to April 6, 1899.) Then followed the Philippine
+War during which 1,037 Americans were killed in action or died of
+wounds; 2,818 were wounded, and 2,748 died of disease. ("Historical
+Register," Vol. II, p. 293.)
+
+The Philippines were conquered twice--once in a contest with Spain (in
+cooperation with the Filipinos, who regarded themselves as our allies),
+and once in a contest with the Filipinos, the native inhabitants, who
+were made subjects of the American Empire by this conquest.[36]
+
+
+5. _Imperialism Accepted_
+
+The Philippine War was the last political episode in the life of the
+American Republic. From February 4, 1899, the United States accepted the
+political status of an Empire. Hawaii had been annexed at the behest of
+the Hawaiian Government; Porto Rico had been occupied as a part of the
+war strategy and without any protest from the Porto Ricans. The
+Philippines were taken against the determined opposition of the natives,
+who continued the struggle for independence during three bitter years.
+
+The Filipinos were fighting for independence--fighting to drive invaders
+from their soil. The United States authorities had no status in the
+Philippines other than that of military conquerors.
+
+Continental North America was occupied by the whites after a long
+struggle with the Indian tribes. This territory was "conquered"--but it
+was contiguous--it formed a part of a geographic unity. The Philippines
+were separated from San Francisco by 8,000 miles of water;
+geographically they were a part of Asia. They were tropical in
+character, and were inhabited by tribes having nothing in common with
+the American people except their common humanity. Nevertheless, despite
+non-contiguity; despite distance; despite dissimilarity in languages and
+customs, the soldiers of the United States conquered the Filipinos and
+the United States Government took control of the islands, acting in the
+same way that any other empire, under like circumstances, unquestionably
+would have acted.
+
+There was no strategic reason that demanded the Philippines unless the
+United States desired to have an operating base near to the vast
+resources and the developing markets of China. As a vantage point from
+which to wage commercial and military aggression in the Far East, the
+Philippines may possess certain advantages. There is no other excuse for
+their conquest and retention by the United States save the economic
+excuse of advantages to be gained from the possession of the islands
+themselves.
+
+The end of the nineteenth century saw the end of the Republic about
+which men like Jefferson and Lincoln wrote and dreamed. The New Century
+marked the opening of a new epoch--the beginning of world dominion for
+the United States.
+
+FOOTNOTES:
+
+[35] "A History of the American People," Woodrow Wilson. New York,
+Harpers, 1902, Vol. V, pp. 273-4.
+
+[36] For further details on the Philippine problem see Senate Document
+62, Part I, 55th Congress, Third Session.
+
+
+
+
+VII. THE STRUGGLE FOR WEALTH AND POWER
+
+
+1. _Economic Foundations_
+
+The people of the United States, through their contests with the
+American Indians, the Mexicans and the Filipinos, have established that
+"supreme and extensive political domination" which is one of the chief
+characteristics of empire.
+
+But the American Empire does not rest upon a political basis. Only the
+most superficial portions of its superstructure are political in
+character. Imperialism in the United States, as in every other modern
+country, is built not upon politics, but upon industry.
+
+The struggle between empires has shifted, in recent years, from the
+political and the military to the economic field. The old imperialism
+was based on military conquest and political domination. The new
+"financial" imperialism is based on economic opportunities and
+advantages. Under this new regime, territorial domination is
+subordinated to business profit.
+
+While American public officials were engaged in the routine task of
+extending the political boundaries of the United States, the foundations
+of imperial strength were being laid by the masters of industrial
+life--the traders, manufacturers, bankers, the organizers of trusts and
+of industrial combinations. These owners and directors of the nation's
+wealth have been the real builders of the American Empire.
+
+As the United States has developed, the economic motives have come more
+and more to the surface, until no modern nation--not England
+herself--has such a record in the search for material possessions. The
+pursuit of wealth, in the United States, has been carried forward
+ruthlessly; brutally. "Anything to win" has been the motto. Man against
+man, and group against group, they have struggled for gain,--first, in
+order to "get ahead;" then to accumulate the comforts and luxuries, and
+last of all, to possess the immense power that goes with the control of
+modern wealth.
+
+The early history of the country presaged anything but this. The
+colonists were seeking to escape tyranny, to establish justice and to
+inaugurate liberty. Their promises were prophetic. Their early deeds put
+the world in their debt. Forward looking people everywhere thrilled at
+the mention of the name "America." Then came the discovery of the
+fabulous wealth of the new country; the pressure of the growing stream
+of immigrants; the heaping up of riches; the rapacious search after
+more! more! the desertion of the dearest principles of America's early
+promise, and the transcribing of another story of "economic
+determinism."
+
+Until very recent times the American people continued to talk of
+political affairs as though they were the matters of chief public
+concern. The recent growth and concentration of economic power have
+showed plainly, however, that America was destined to play her greatest
+role on the economic field. Capable men therefore ceased to go into
+politics and instead turned their energies into the whirl of business,
+where they received a training that made them capable of handling
+affairs of the greatest intricacy and magnitude.
+
+
+2. _Every Man for Himself_
+
+The development of American industry, during the hundred years that
+began with the War of 1812, led inevitably to the unification of
+business control in the hands of a small group of wealth owners.
+
+"Every man for himself" was the principle that the theorists of the
+eighteenth century bequeathed to the industrial pioneers of the
+nineteenth. The philosophy of individualism fitted well with the
+temperament and experience of the English speaking peoples; the practice
+of individualism under the formula "Every man for himself" seemed a
+divine ordination for the benefit of the new industry.
+
+The eager American population adopted the slogan with enthusiasm. "Every
+man for himself" was the essence of their frontier lives; it was the
+breath of the wilderness.
+
+But the idea failed in practice. Despite the assurances of its champions
+that individualism was necessary to preserve initiative and that
+progress was impossible without it, like many another principle--fine
+sounding in theory, it broke down in the application.
+
+The first struggle that confronted the ambitious conqueror of the new
+world was the struggle with nature. Her stores were abundant, but they
+must be prepared for human use. Timber must be sawed; soil tilled; fish
+caught; coal mined; iron smelted; gold extracted. Rivers must be
+bridged; mountains spanned; lines of communication maintained. The
+continent was a vast storehouse of riches--potential riches. Before they
+could be made of actual use, however, the hand of man must transform
+them and transport them.
+
+These necessary industrial processes were impossible under the "every
+man for himself" formula. Here was a vast continent, with boundless
+opportunities for supplying the necessaries and comforts of
+life--provided men were willing to come together; divide up the work;
+specialize; and exchange products.
+
+Cooperation--alone--could conquer nature. The basis of this cooperation
+proved to be the machine. Its means was the system of production and
+transportation built upon the use of steam, electricity, gas, and labor
+saving appliances.
+
+When the United States was discovered, the shuttle was thrown by hand;
+the hammer was wielded by human arm; the mill-stones were turned by wind
+and water; the boxes and bales were carried by pack-animals or in
+sailing vessels,--these processes of production and transportation were
+conducted in practically the same way as in the time of Pharaoh or of
+Alexander the Great. A series of discoveries and inventions, made in
+England between 1735 and 1784, substituted the machine for the tool; the
+power of steam for the power of wind, water or human muscle; and set up
+the factory to produce, and the railroad and the steamboat to transport
+the factory product.
+
+American industry, up to 1812, was still conducted on the old,
+individualistic lines. Factories were little known. Men worked singly,
+or by twos and threes in sheds or workrooms adjoining their homes. The
+people lived in small villages or on scattered farms. Within the century
+American industry was transformed. Production shifted to the factory;
+about the factory grew up the industrial city in which lived the tens or
+hundreds of thousands of factory workers and their families.
+
+The machine made a new society. The artisan could not compete with the
+products of the machine. The home workshop disappeared, and in its place
+rose the factory, with its tens, its hundreds and its thousands of
+operatives.
+
+Under the modern system of machine production, each person has his
+particular duty to perform. Each depends, for the success of his
+service, upon that performed by thousands of others.
+
+All modern industry is organized on the principle of cooperation,
+division of labor, and specialization. Each has his task, and unless
+each task is performed the entire system breaks down.
+
+Never were the various branches of the military service more completely
+dependent upon each other than are the various departments of modern
+economic life. No man works alone. All are associated more or less
+intimately with the activities of thousands and millions of their
+fellows, until the failure of one is the failure of all, and the success
+of one is the success of all.
+
+Such a development could have only one possible result,--people who
+worked together must live together. Scattered villages gave place to
+industrial towns and cities. People were compelled to cooperate in their
+lives as well as in their labor.
+
+The theory under which the new industrial society began its operations
+was "every man for himself." The development of the system has made
+every man dependent upon his fellows. The principle demanded an extreme
+individualism. The practice has created a vast network of
+inter-relations, that leads the cotton spinner of Massachusetts to eat
+the meat prepared by the packing-house operative in Omaha, while the
+pottery of Trenton and the clothing of New York are sent to the Yukon in
+exchange for fish and to the Golden Gate for fruit. Inside as well as
+outside the nation, the world is united by the strong hands of economic
+necessity. None can live to himself, alone. Each depends upon the labor
+of myriads whom he has never seen and of whom he has never heard.
+Whether we will or no, they are his brothers-in-labor--united in the
+Atlas fellowship of those who carry the world upon their shoulders.
+
+The theory of "every man for himself" failed. The practical exigencies
+involved in subjugating a continent and wresting from nature the means
+of livelihood made it necessary to introduce the opposite
+principle,--"In Union there is strength; cooperation achieves all
+things."
+
+
+3. _The Struggle for Organization_
+
+The technical difficulties involved in the mechanical production of
+wealth compelled even the individualists to work together. The
+requirements of industrial organization drove them in the same
+direction.
+
+The first great problem before the early Americans was the conquest of
+nature. To this problem the machine was the answer. The second problem
+was the building of an organization capable of handling the new
+mechanism of production--an organization large enough, elastic enough,
+stable enough and durable enough--to this problem the corporation was
+the answer.
+
+The machine produced the goods. The corporation directed the production,
+marketed the products and financed both operations.
+
+The corporation, as a means of organizing and directing business
+enterprise is a product of the last hundred years. A century ago the
+business of the United States was carried on by individuals,
+partnerships, and a few joint stock companies. At the time of the last
+Census, more than four-fifths of the manufactured products were turned
+out under corporate direction; most of the important mining enterprises
+were corporate, and the railroads, public utilities, banks and insurance
+companies were virtually all under the corporate form of organization.
+Thus the passage of a century has witnessed a complete revolution in the
+form of organizing and directing business enterprise.
+
+The corporation, as a form of business organization is immensely
+superior to individual management and to the partnership.
+
+1. The corporation has perpetual life. In the eyes of the law, it is a
+person that lives for the term of its charter. Individuals die;
+partnerships are dissolved; but the corporation with its unbroken
+existence, possesses a continuity and a permanence that are impossible
+of attainment under the earlier forms of business organization.
+
+2. Liability, under the corporation, is limited by the amount of the
+investment. The liability of an individual or a partner engaged in
+business was as great as his ability to pay. The investor in a
+corporation cannot lose a sum larger than that represented by his
+investment.
+
+3. The corporation, through the issuing of stocks and bonds, makes it
+possible to subdivide the total amount invested in one enterprise into
+many small units.[37] These chances for small investment mean that a
+large number of persons may join in subscribing the capital for a
+business enterprise. They also mean that one well-to-do person may
+invest his wealth in a score or a hundred enterprises, thus reducing the
+risk of heavy losses to a minimum.
+
+4. The corporation is not, as were the earlier forms of organization,
+necessarily a "one man" concern. Many corporations have upon their
+boards of directors the leading business men, merchants, bankers and
+financiers. In this way, the investing public has the assurance that the
+enterprise will be conducted along business lines, while the business
+men on the board have an opportunity to get in on the "ground floor."
+
+The corporation has a permanence, a stability, and a breadth of
+financial support that are quite impossible in the case of the private
+venture or of the partnership. It does for business organization what
+the machine did for production.
+
+The corporation came into favor at a time when business was expanding
+rapidly. Surplus was growing. Wealth and capital were accumulating.
+Industrial units were increasing in size. It was necessary to find some
+means by which the surplus wealth in the hands of many individuals could
+be brought together, large sums of capital concentrated under one
+unified control, the investments, thus secured, safeguarded against
+untoward losses, and the business conservatively and efficiently
+directed. The corporation was the answer to these needs.
+
+"United we stand" proved to be as true of organizers and investors as it
+was of producers. The corporation was the common denominator of people
+with various industrial and financial interests.
+
+The corporation played another role of vital consequence. It enabled the
+banker to dominate the business world. Heretofore, the banker had dealt
+largely with exchange. The industrial leader was his equal if not his
+superior. The organization of the corporation put the supreme power in
+the hands of the banker, who as the intermediary between investor and
+producer, held the purse strings.
+
+
+4. _Capitalist against Capitalist_
+
+The early American enterprisers--the pioneers--began a single-handed
+struggle with nature. Necessity forced them to cooperate. They
+established a new industry. The factory brought them together. They
+organized their system of industrial direction and control. The
+corporation united them. They turned on one another in mortal combat,
+and the frightfulness of their losses forced them to join hands.
+
+The business men of the late nineteenth century had been nurtured upon
+the idea of competition. "Every man for himself and the devil take the
+hindermost" summed up their philosophy. Each person who entered the
+business arena was met by an array of savage competitors whose motto was
+"Victory or Death." In the struggle that followed, most of them suffered
+death.
+
+Capitalist set himself up against capitalist in bitter strife. The
+railroads gouged the farmers, the manufacturers and the merchants and
+fought one another. The big business organizations drove the little man
+to the wall and then attacked their larger rivals. It was a fight to the
+finish with no quarter asked or given.
+
+The "finish" came with periodic regularity in the seventies, the
+eighties and the nineties. The number of commercial failures in 1875 was
+double the number of 1872. The number of failures in 1878 was over three
+times that of 1871. The same thing happened in the eighties. The
+liabilities of concerns failing in 1884 were nearly four times the
+liabilities of those failing in 1880. The climax came in the nineties,
+after a period of comparative prosperity. Hard times began in 1893.
+Demand dropped off. Production decreased. Unemployment was widespread.
+Wages fell. Prices went down, down, under bitter competitive selling,
+to touch rock bottom in 1896. Business concerns continued to fight one
+another, though both were going to the wall. Weakened by the struggle,
+unable to meet the competitive price cutting that was all but the
+universal business practice of the time, thousands of business houses
+closed their doors. The effect was cumulative; the fabric of credit,
+broken at one point, was weakened correspondingly in other places and
+the guilty and the innocent were alike plunged into the morass of
+bankruptcy.
+
+The destruction wrought in the business world by the panic of 1893 was
+enormous. The number of commercial failures for 1893 jumped to 15,242.
+The amount of liabilities involved in these failures was $346,780,000.
+This catastrophe, coming as it did so close upon the heels of the panics
+that had immediately preceded it, could not fail to teach its lesson.
+Competition was not the life, but the death of trade. "Every man for
+himself" as a policy applied in the business world, led most of those
+engaged in the struggle over the brink to destruction. There was but one
+way out--through united action.
+
+The period between 1897 and 1902 was one of feverish activity directed
+to coordinating the affairs of the business world. Trusts were formed in
+all of the important branches of industry and trade. The public looked
+upon the trust as a means of picking pockets through trade conspiracies
+and the boosting of prices. The Sherman Anti-Trust Law had been passed
+on that assumption. In reality, the trusts were organized by far seeing
+men who realized that competition was wasteful in practice and unsound
+in theory. The idea that the failure of one bank or shoe factory was of
+advantage to other banks and shoe factories, had not stood the test of
+experience. The tragedies of the nineties had showed conclusively that
+an injury to one part of the commercial fabric was an injury to all of
+its parts.
+
+The generation of business men trained since 1900 has had no illusions
+about competition. Rather, it has had as its object the successful
+combination of various forms of business enterprise into ever larger
+units. First, there was the uniting of like industries;--cotton mills
+were linked with cotton mills, mines with mines. Then came the
+integration of industry--the concentration under one control of all of
+the steps in the industrial process from the raw material to the
+finished product,--iron mines, coal mines, blast furnaces, converters,
+and rail mills united in one organization to take the raw material from
+the ground and to turn out the finished steel product. Last of all there
+was the union of unlike industries,--the control, by one group of
+interests, of as many and as varied activities as could be brought
+together and operated at a profit. The lengths to which business men
+have gone in combining various industries is well shown by the recent
+investigation of the meat packing industry. In the course of that
+investigation, the Federal Trade Commission was able to show that the
+five great packers (Wilson, Armour, Swift, Morris and Cudahy) were
+directly affiliated with 108 business enterprises, including 12
+rendering companies; 18 stockyard companies; 8 terminal railway
+companies; 9 manufacturers of packers' machinery and supplies; 6 cattle
+loan companies; 4 public service corporations; 18 banks, and a number of
+miscellaneous companies, and that they controlled 2000 food products not
+immediately related to the packing industry.[38]
+
+Business is consolidated because consolidation pays--not primarily,
+through the increase of prices, but through the greater stability, the
+lessened costs, and the growing security that has accompanied the
+abolition of competition.
+
+Again the forces of social organization have triumphed in the face of an
+almost universal opposition. American business men practiced competition
+until they found that cooperation was the only possible means of
+conducting large affairs. Theory advised, "Compete"! Experience warned,
+"Combine"! Business men--like all other practical people--accepted the
+dictates of experience as the only sound basis for procedure. Their
+combination solidified their ranks, preparing them to take their places
+in a closely knit, dominant class, with clearly marked interests, and a
+strong feeling of class consciousness and solidarity.
+
+It was in the consummation of these combinations, integrations and
+consolidations that the investment banker came into his own as the
+keystone in the modern industrial arch.
+
+
+5. _The Investment Banker_
+
+The investment banker is the directing and coordinating force in the
+modern business world. The necessities of factory production demanding
+great outlays of capital; the immense financial requirements of
+corporations; the consolidation of business ventures on a huge scale;
+the broadened use of corporate securities as investments--all brought
+the investment banker into the foreground.
+
+Before the Spanish War, the investment banker financed the trusts. After
+the war he was entrusted with the vast surpluses which the concentration
+of business control had placed in a few hands. Business consolidation
+had given the banker position. The control of the surplus brought him
+power. Henceforth, all who wished access to the world of great
+industrial and commercial affairs must knock at his door.
+
+This concentration of economic control in the hands of a relatively
+small number of investment bankers has been referred to frequently as
+the "Money Trust."
+
+Investment banking monopoly, or as it is sometimes called, the "Money
+Trust" was examined in detail by the Pujo Committee of the House of
+Representatives, which presented a summary of its report on February 28,
+1913. The committee placed, at the center of its diagram of financial
+power, J. P. Morgan & Co., the National City Bank, the First National
+Bank, the Guaranty Trust Co., and the Bankers Trust Co., all of New
+York. The report refers to Lee, Higginson & Co., of Boston and New
+York; to Kidder, Peabody & Co., of Boston and New York, and to Kuhn,
+Loeb & Co., of New York, together with the Morgan affiliations, as being
+"the most active agents in forwarding and bringing about the
+concentration of control of money and credit" (p. 56).
+
+The methods by which this control was effected are classed by the
+Committee under five heads:--
+
+1. "Through consolidations of competitive or potentially competitive
+banks and trust companies which consolidations in turn have recently
+been brought under sympathetic management" (p. 56).
+
+2. Through the purchase by the same interests of the stock of
+competitive institutions.
+
+3. Through interlocking directorates.
+
+4. "Through the influence which the more powerful banking houses, banks,
+and trust companies have secured in the management of insurance
+companies, railroads, producing and trading corporations and public
+utility corporations, by means of stock holdings, voting trusts, fiscal
+agency contracts, or representation upon their boards of directors, or
+through supplying the money requirements of railway, industrial, and
+public utility corporations and thereby being enabled to participate in
+the determination of their financial and business policies" (p. 56).
+
+5. "Through partnership or joint account arrangements between a few of
+the leading banking houses, banks, and trust companies in the purchase
+of security issues of the great interstate corporations, accompanied by
+understandings of recent growth--sometimes called 'banking
+ethics'--which have had the effect of effectually destroying competition
+between such banking houses, banks, and trust companies in the struggle
+for business or in the purchase and sale of large issues of such
+securities" (p. 56).
+
+Morgan & Co., the First National Bank, the National City Bank, the
+Bankers Trust Co., and the Guaranty Trust Co., which were all closely
+affiliated, had extended their control until they held,--
+
+
+     118 directorships in 34 banks with combined resources of
+     $2,679,000,000.
+
+     30 directorships in 10 insurance companies with total assets of
+     $2,293,000,000.
+
+     105 directorships in 32 transportation systems having a total
+     capital of $11,784,000,000.
+
+     63 directorships in 24 producing and trading companies having a
+     total capitalization of $3,339,000,000.
+
+     25 directorships in 12 public utility corporations with a total
+     capitalization of $2,150,000,000.
+
+
+The investment banker had become, what he was ultimately bound to be,
+the center of the system built upon the century-long struggle to control
+the wealth of the continent in the interest of the favored few who
+happened to own the choicest natural gifts.
+
+
+6. _The Cohesion of Wealth_
+
+The struggle for wealth and power, actively waged among the business men
+of the United States for more than a century, has thus by a process of
+elimination, subordination and survival, placed a few small groups of
+strong men in a position of immense economic power. The growth of
+surplus and its importance in the world of affairs has made the
+investment banker the logical center of this business leadership. He,
+with his immediate associates, directs and controls the affairs of the
+economic world.
+
+The spirit of competition ruled the American business world at the
+beginning of the last century, the forces of combination dominated at
+its close. The new order was the product of necessity, not of choice.
+The life of the frontier had ingrained in men an individualism that
+chafed under the restraints of combination. It was the compelling
+forces of impending calamity and the opportunity for greater economic
+advantage--not the traditions or accepted standards of the business
+world--that led to the establishment of the centralized wealth power.
+American business interests were driven together by the battering of
+economic loss and lured by the hope of greater economic gains.
+
+Years of struggle and experience, by converting a scattered,
+individualistic wealth owning class into a highly organized, closely
+knit, homogeneous group with its common interests in the development of
+industry and the safeguarding of property rights, have brought unity and
+power to the business world.
+
+Individually the members of the wealth-controlling class have learned
+that "in union there is strength"; collectively they are gripped by the
+"cohesion of wealth"--the class conscious instinct of an associated
+group of human beings who have much to gain and everything to lose.
+
+FOOTNOTES:
+
+[37] The 169 largest railroads in the United States have issued
+84,418,796 shares of stock. ("American Labor Year Book," 1917-18, p.
+169.) Theoretically, therefore, there might be eighty-four millions of
+owners of the American railroads.
+
+[38] Summary of the Report of the Federal Trade Commission on the Meat
+Packing Industry, July 3, 1918, Wash., Govt. Print., 1918.
+
+
+
+
+VIII. THEIR UNITED STATES
+
+
+1. _Translating Wealth into Power_
+
+The first object of the economic struggle is wealth. The second is
+power.
+
+At the end of their era of competition, the leaders of American business
+found themselves masters of such vast stores of wealth that they were
+released from the paralyzing fear of starvation, and were guaranteed the
+comforts and luxuries of life. Had these men sought wealth as a means of
+satisfying their physical needs their object would have been attained.
+
+The gratification of personal wants is only a minor element in the lives
+of the rich. After they have secured the things desired, they strive for
+the power that will give them control over their fellows.
+
+The possession of things, is, in itself, a narrow field. The control
+over productive machinery gives him who exercises it the power to enjoy
+those things which the workers with machinery produce. The control over
+public affairs and over the forces that shape public opinion give him
+who exercises it the power to direct the thoughts and lives of the
+people. It is for these reasons that the keen, self-assertive, ambitious
+men who have come to the top in the rough and tumble of the business
+struggle have steadily extended their ownership and their control.
+
+
+2. _The Wealth of the United States_
+
+The bulk of American wealth, which consists for the most part of land
+and buildings, is concentrated in the centers of commerce and
+industry--in the regions of supreme business power.
+
+The last detailed estimate of the wealth of the United States was made
+by the Census Bureau for the year 1912. At that time, the total wealth
+of the country was placed at $187,739,000,000. (The estimate for 1920 is
+$500,000,000,000.) Roughly speaking, this represented an estimate of
+exchangeable values. The figures, at best, are rough approximations.
+Their importance lies, not in their accuracy, but in the picture which
+they give of relationships.
+
+
+The Total Wealth of the United States, Classified by Groups, with the
+Percentage of the Total Wealth in Each Group[39]
+
+
+                                               _Total Estimated
+                                                    Wealth_
+
+                                             _Amount_
+                                             (000,000   _Per Cent_
+             _Wealth Groups_                _Omitted_)   _of Total_
+
+     1. Real Property (land and buildings)   $110,676       59
+
+     2. Public Utilities (railroads, street
+     railways, telegraph, telephone,
+     electric light, etc.)                     26,415       14
+
+     3. Live Stock and Machinery (live
+     stock, farm implements and manufacturing
+     machinery)                                13,697        7
+
+     4. Raw Materials, Manufactured Products,
+     Merchandise (including
+     gold and silver bullion)                  24,193       13
+
+     5. Personal Possessions (clothing,
+     personal adornments, furniture,
+     carriages, etc.)                          12,758        7
+
+     Total of all groups                     $187,739      100
+
+
+The bulk of the exchangeable wealth of the United States consists of
+"productive" or "investment" property. If, to the total of 110 billions
+given by the Census as the value of real property, are added the real
+property values of the public utilities, the total will probably exceed
+three quarters of the total wealth of the United States. If, in
+addition, account is taken of the fact that much of the wealth classed
+as "raw materials, etc.," is the immediate product of the land (coal,
+ore, timber), some idea may be obtained of the extent to which the
+estimated wealth of the country is in the form of land, its immediate
+products, and buildings. Furthermore, it must be remembered that great
+quantities of ore lands, timber lands, waterpower sites, etc., are
+assessed at only a fraction of their total present value.
+
+The personal property of the country is valued at less than one
+fourteenth of the total wealth. It is in reality a negligible item, as
+compared with the value of the real property, of the public utilities,
+and of the raw materials and products of industry.
+
+The wealth of the United States is in permanent form--land and
+improvements; personal possessions are a mere incident in the total. In
+truth, American wealth is in the main productive (business) wealth,
+designed for the further production of goods, rather than for the
+satisfaction of human wants.
+
+
+3. _Ownership and Control_
+
+Who owns this vast wealth? It is impossible to answer the question with
+anything like definiteness. Figures have been compiled to show that five
+per cent of the people own two-thirds to three-quarters of it; that the
+poorest two-thirds of the people own five per cent of it, and that the
+well-to-do or middle class own the remainder. These figures would make
+it appear that more than one-fourth of the population is in the middle
+class. If the income-tax returns are to be trusted this proportion is
+far too high. On all hands it is admitted that the wealth of the
+country is concentrated in the hands of a small fraction of the people
+and the important wealth--that is, the wealth upon which production,
+transportation and exchange depends--is in still fewer hands.
+
+Neither the total wealth of the country, nor that portion of the total
+which is owned directly by the propertied class is of most immediate
+moment. Ownership does not necessarily involve control. A puddler in the
+Gary Mills may own five shares of stock in the Steel Corporation without
+ever raising his voice to determine the corporation policy. This is
+ownership without control. On the other hand, a banking house through a
+voting trust agreement, may control the policy of a corporation in which
+it does not own one per cent of the stock. This is control without
+ownership. Ownership may be quite incidental. It is control that counts
+in terms of power.
+
+Most of the property owners in the United States play no part in the
+control of prices or of production, in the direction of economic policy,
+or in the management of economic affairs.
+
+Theoretically, stockholders direct the policies of corporations, and,
+therefore, each holder of 5 or 10 shares of corporate stock would play a
+part in deciding economic affairs. Practically, the small stockholder
+has no part in business control.
+
+The small farmer--the small business man of largest numerical
+consequence--has been exploited by the great interests for two
+generations. Despite his numbers and his organizations, despite his
+frequent efforts, through anti-trust laws, railway control laws, banking
+reform laws, and the like, he has little voice in determining important
+economic policies.
+
+The small savings bank depositor or the holder of an ordinary insurance
+policy is a negative rather than a positive factor in economic control.
+Not only does he exercise no power over the dollar which he has placed
+with the bank or with the insurance company, but he has thereby
+strengthened the hands of these organizations. Each dollar placed with
+the financier is a dollar's more power for him and his.
+
+Suppose--the impossible--that half of the families in the United States
+"own property." Subtract from this number the small stockholders; the
+holders of bonds, notes and mortgages; the small tradesman; the small
+farmer; the home owner and the owner of a savings-bank deposit or of an
+insurance policy--what remains? There are the large stockholders, the
+owners and directors of important industries, public utilities, banks,
+trust companies and insurance companies. These persons, in the
+aggregate, constitute a fraction of one per cent of the adult population
+of the United States.
+
+Start with the total non-personal wealth of the country, subtract from
+it the share-values of the small stockholders; the values of all bonds,
+mortgages and notes; the property of the small tradesman and the small
+farmer; the value of homes--what remains? There are left the stocks in
+the hands of the big stockholders; the properties owned and directed by
+the owners and directors of important industries, public utilities,
+banks, trust companies and insurance companies. This wealth in the
+aggregate probably makes up less than 10 per cent of the total wealth of
+the country and yet the tiny fraction of the population which owns this
+wealth can exercise a dictatorial control over the economic policies
+that underlie American public life.
+
+
+4. _The Avenues of Mastery_
+
+While control rests back directly or indirectly upon some form of
+ownership, most owners exercise little or no control over economic
+affairs. Instead they are made the victims of a social system under
+which one group lives at the expense of another.
+
+Against this tendency toward control by one group or class (usually a
+minority) over the lives of another group or class (usually a majority)
+the human spirit always has revolted. The United States in its earlier
+years was an embodiment of the spirit of that revolt. President Wilson
+characterized it excellently in 1916. Speaking of the American Flag, he
+said,--"That flag was originally stained in very precious blood, blood
+spilt, not for any dynasty, nor for any small controversies over
+national advantage, but in order that a little body of three million men
+in America might make sure that no man was their master."[40]
+
+Against mastery lovers of liberty protest. Mastery means tyranny;
+mastery means slavery.
+
+Mastery has always been based upon some form of ownership. There is in
+the United States a group, growing in size, of people who take more in
+keep than they give in service; people who own land; franchises; stocks
+and bonds and mortgages; real estate and other forms of investment
+property; people who are living without ever lifting a finger in toil,
+or giving anything in labor for an unceasing stream of necessaries,
+comforts and luxuries. These people, directly or indirectly, are the
+owners of the productive machinery of the United States.
+
+Historically there have been a number of stages in the development of
+mastery. First, there was the ownership of the body. One man owned
+another man, as he might own a house or a pile of hides. At another
+stage, the owner of the land--the feudal baron or the landlord--said to
+the tenant, who worked on his land: "You stay on my land. You toil and
+work and make bread and I will eat it." The present system of mastery is
+based on the ownership by one group of people, of the productive wealth
+upon which depends the livelihood of all. The masters of present day
+economic society have in their possession the natural resources, the
+tools, the franchises, patents, and the other phases of the modern
+industrial system with which the people must work in order to live. The
+few who own and control the productive wealth have it in their power to
+say to the many who neither own nor control,--"You may work or you may
+not work." If the masses obtain work under these conditions the owners
+can say to them further,--"You work, and toil and earn bread and we will
+eat it." Thus the few, deriving their power from the means by which
+their fellows must work for a living, own the jobs.
+
+
+5. _The Mastery of Job-Ownership_
+
+Job-ownership is the foundation of the latest and probably the most
+complete system of mastery ever perfected. The slave was held only in
+physical bondage. Behind serfdom there was land ownership and a
+religious sanction. "Divine right" and "God's anointed," were terms used
+to bulwark the position of the owning class, who made an effort to
+dominate the consciences as well as the bodies of their serfs.
+Job-ownership owes its effectiveness to a subtle, psychological power
+that overwhelms the unconscious victim, making him a tool, at once easy
+to handle and easy to discard.
+
+The system of private ownership that succeeded Feudalism taught the
+lesson of economic ambition so thoroughly that it has permeated the
+whole world. The conditions of eighteenth century life have passed,
+perhaps forever, but its psychology lingers everywhere.
+
+The job-holder has been taught that he must "get ahead" in the world;
+that if he practices the economic virtues,--thrift, honesty,
+earnestness, persistence, efficiency--he will necessarily receive great
+economic reward; that he must support his family on the standard set by
+the community, and that to do all of these essential things, he must
+take a job and hold on to it. Having taken the job, he finds that in
+order to hold it, he must be faithful to the job-owner, even if that
+involves faithlessness to his own ideas and ideals, to his health, his
+manhood, and the lives of his wife and children.
+
+The driving power in slavery was the lash. Under serfdom it was the
+fear of hunger. The modern system of job-ownership owes its
+effectiveness to the fact that it has been built upon two of the most
+potent driving forces in all the world--hunger and ambition--the driving
+force that comes from the empty stomach and the driving force that comes
+from the desire for betterment. Thus job-owning, based upon an automatic
+self-drive principle, enables the job-owner to exact a return in
+faithful service that neither slavery nor serfdom ever made possible.
+Job-owning is thus the most thorough-going form of mastery yet devised
+by the ingenuity of man.
+
+Unlike the slave owner and the Feudal lord the modern job-owner has no
+responsibility to the job-holder. The slave owner must feed, clothe and
+house his slave--otherwise he lost his property. The Feudal lord must
+protect and assist his tenant. That was a part of his bargain with his
+overlord. The modern job-owner is at liberty, at any time, to
+"discharge" the job-holder, and by throwing him out of work take away
+his chance of earning a living. While he keeps the job-holder on his
+payroll, he may pay him impossibly low wages and overwork him under
+conditions that are unfit for the maintenance of decent human life.
+Barring the factory laws and the health laws, he is at liberty to impose
+on the job-holder any form of treatment that the job-holder will
+tolerate.
+
+There is no limit to the amount of industrial property that one man may
+own. Therefore, there is no limit to the number of jobs he may control.
+It is possible (not immediately likely) that one coterie of men might
+secure possession of enough industrial property to control the jobs of
+all of the gainfully occupied people in American industry. If this
+result could be achieved, these tens of millions would be able to earn a
+living only in case the small coterie in control permitted them to do
+so.
+
+Job ownership is built, of necessity, on the ownership of land,
+resources, capital, credit, franchises, and other special privileges.
+But its power of control goes far beyond this mere physical ownership
+into the realms of social psychology.
+
+The early colonists, who fled from the economic, political, social and
+religious tyranny of feudalism, believed that liberty and freedom from
+unjust mastery lay in the private ownership of the job. They had no
+thought of the modern industrial machine.
+
+The abolitionists who fought slavery believed that freedom and liberty
+could be obtained by unshackling the body. They did not foresee the
+shackled mind.
+
+The modern world, seeking freedom; yearning for liberty and justice;
+aiming at the overthrow of the mastery that goes with irresponsible
+power, finds to its dismay that the ownership of the job carries with
+it, not only economic mastery, but political, social and even religious
+mastery, as well.
+
+
+6. _The Ownership of the Product_
+
+The industrial overlord holds control of the job with one hand. With the
+other he controls the product of industry. From the time the raw
+material leaves the earth in the form of iron ore, crude petroleum,
+logs, or coal, through all of the processes of production, it is owned
+by the industrial master, not by the worker. Workers separate the
+product from the earth, transport it, refine it, fabricate it. Always,
+the product, like the machinery, is the possession of the owning class.
+
+While industry was competitive, the pressure of competition kept prices
+at a cost level, and the exploiting power of the owner was confined to
+the job-holder. To-day, through combinations and consolidations,
+industry has ceased to be competitive, and the exploiting power of the
+job-owner is extended through his ownership of the product.
+
+The modern town-dweller is almost wholly in the hands of the private
+owners of the products upon which he depends. The ordinary city dweller
+spends two-fifths of his income for food; one-fifth for rent, fuel and
+light, and one-fifth for clothes. Food, houses, fuel (with the exception
+of gas supply in some cities), and clothing are privately owned. The
+public ownership of streets and water works, of some gas, electricity,
+street cars, and public markets, is a negligible factor in the problem.
+The private monopolist has the upper hand and he is able through the
+control of transportation, storage, and merchandising facilities, to
+make handsome profits for the "service" which he renders the consumer.
+
+
+7. _The Control of the Surplus_
+
+The wealth owners are doubly entrenched. They own the jobs upon which
+most families depend for a living. They own the necessaries of life
+which most families must purchase in order to live. Further, they
+control the surplus wealth of the community.
+
+There are three principal channels of surplus. First of all there is the
+surplus laid aside by business concerns, reinvested in the business,
+spent for new equipment and disposed of in other ways that add to the
+value of the property. Second, there are the 19,103 people in the United
+States with incomes of $50,000 or more per year; the 30,391 people with
+incomes of $25,000 to $50,000 per year and the 12,502 people with
+incomes of $10,000 to $25,000 per year. (Figures for 1917.) Many, if not
+most of these rich people, carry heavy insurance, invest in securities,
+or in some other way add to surplus. In the third place there are the
+small investors, savings-bank depositors, insurance policy holders who,
+from their income, have saved something and have laid it aside for the
+rainy day. The masters of economic life--bankers, insurance men,
+property holders, business directors--are in control of all three forms
+of surplus.
+
+The billions of surplus wealth that come each year under the control of
+the masters carry with them an immense authority over the affairs of the
+community. The owners of wealth owe much of their immediate power to
+the fact that they control this surplus, and are in a position to direct
+its flow into such channels as they may select.
+
+
+8. _The Channels of Public Opinion_
+
+No one can question the control which business interests exercise over
+the jobs, the industrial product, and the economic surplus of the
+community. These facts are universally admitted. But the corollaries
+which flow naturally from such axioms are not so readily accepted. Yet
+given the economic power of the business world, the control over the
+channels of public opinion and over the machinery of government follows
+as a matter of course.
+
+The channels of public opinion--the school, the press, the pulpit,--are
+not directly productive of tangible economic goods, yet they depend upon
+tangible economic goods for their maintenance. Whence should these goods
+come? Whence but from the system that produces them, through the men who
+control that system! The plutocracy exercises its power over the
+channels of public opinion in two ways,--the first, by a direct or
+business office control; and second, by an indirect or social prestige
+control.
+
+The business office control is direct and simple. Schools, colleges,
+newspapers, magazines and churches need money. They cannot produce
+tangible wealth directly, and they must, therefore, depend upon the
+surplus which arises from the productive activities of the economic
+world. Who controls that surplus? Business men. Who, then, is in a
+position to dictate terms in financial matters? Who but the dominant
+forces in business life?
+
+The facts are incontrovertible. It is not mere chance that recruits the
+overwhelming majority of school-board members, college trustees,
+newspaper managers, and church vestrymen, from the ranks of successful
+business and professional men. It is necessary for the educator, the
+journalist, and the minister to work through these men in order to
+secure the "sinews of war." They are at the focal points of power
+because they control the sources of surplus wealth.
+
+The second method of maintaining control--through the control of social
+prestige--is indirect, but none the less effective. The young man in
+college; the young graduate looking for a job; the young man rising in
+his profession, and the man gaining ascendancy in his chosen career are
+brought into constant contact with the "influential" members of the
+business world. It is the business world that dominates the clubs and
+the vacation spots; it is the business world that is met in church, at
+the dinner tables and at the social gathering.
+
+The man who would "succeed" must retain the favor of this group. He does
+so automatically, instinctively or semi-consciously--it is the common,
+accepted practice and he falls in line.
+
+The masters need not bribe. They need not resort to illegal or unethical
+methods. The ordinary channels of advertising, of business acquaintance
+and patronage, of philanthropy and of social intercourse clinch their
+power over the channels of public opinion.
+
+
+9. _The Control of Political Machinery_
+
+The American government,--city, state and nation--is in almost the same
+position as the schools, newspapers and churches. It does not turn out
+tangible, economic products. It depends, for its support, upon taxes
+which are levied, in the first instance, upon property. Who are the
+owners of this property? The business interests. Who, therefore, pay the
+bills of the government? The business interests.
+
+Nowhere has the issue been stated more clearly or more emphatically than
+by Woodrow Wilson in certain passages of his "New Freedom." As a student
+of politics and government--particularly the American Government--he
+sees the power which those who control economic life are able to
+exercise over public affairs, and realizes that their influence has
+grown, until it overtops that of the political world so completely that
+the machinery of politics is under the domination of the organizers and
+directors of industry.
+
+"We know," writes Mr. Wilson in "The New Freedom," "that something
+intervenes between the people of the United States and the control of
+their own affairs at Washington. It is not the people who have been
+ruling there of late" (p. 28). "The masters of the government of the
+United States are the combined capitalists and manufacturers of the
+United States.... Suppose you go to Washington and try to get at your
+government. You will always find that while you are politely listened
+to, the men really consulted are the men who have the biggest
+stakes--the big bankers, the big manufacturers, the big masters of
+commerce, the heads of railroad corporations and of steamship
+corporations.... Every time it has come to a critical question, these
+gentlemen have been yielded to and their demands have been treated as
+the demands that should be followed as a matter of course. The
+government of the United States at present is a foster-child of the
+special interests" (p. 57-58). "The organization of business has become
+more centralized, vastly more centralized, than the political
+organization of the country itself" (p. 187). "An invisible empire has
+been set up above the forms of democracy" (p. 35). "We are all caught in
+a great economic system which is heartless" (p. 10).
+
+This is the direct control exercised by the plutocracy over the
+machinery of government. Its indirect control is no less important, and
+is exercised in exactly the same way as in the case of the channels of
+public opinion.
+
+Lawyers receive preferment and fees from business--there is no other
+large source of support for lawyers. Judges are chosen from among these
+same lawyers. Usually they are lawyers who have won preferment and
+emolument. Legislators are lawyers and business men, or the
+representatives of lawyers and business men. The result is as logical as
+it is inevitable.
+
+The wealth owners control the machinery of government because they pay
+the taxes and provide the campaign funds. They control public officials
+because they have been, are, or hope to be, on the payrolls, or
+participants in the profits of industrial enterprises.
+
+
+10. _It is "Their United States"_
+
+The man fighting for bread has little time to "turn his eyes up to the
+eternal stars." The western cult of efficiency makes no allowances for
+philosophic propensities. Its object is product and it is satisfied with
+nothing short of that sordid goal.
+
+The members of the wealth owning class are relieved from the food
+struggle. Their ownership of the social machinery guarantees them a
+secure income from which they need make no appeal. These privileges
+provide for them and theirs the leisure and the culture that are the
+only possible excuse for the existence of civilization.
+
+The propertied class, because it owns the jobs, the industrial products,
+the social surplus, the channels of public opinion and the political
+machinery also enjoys the opportunity that goes with adequately assured
+income, leisure and culture.
+
+The members of the dominant economic class hold a key--property
+ownership--which opens the structure of social wealth. Those who have
+access to this key are the blessed ones. Theirs are the things of this
+world.
+
+The property owners enjoy the fleshpots. They hold the vantage points.
+The vital forces are in their hands. Economically, politically,
+socially, they are supreme.
+
+If the control of material things can make a group secure, the wealth
+owners in the United States are secure. They hold property, prestige,
+power.
+
+The phrase "our United States" as used by the great majority of the
+people is a misnomer. With the exception of a theoretically valuable but
+practically unimportant right called "freedom of contract," the majority
+of the wage earners in the United States have no more excuse for using
+the phrase "our United States" than the slaves in the South, before the
+war, for saying "our Southland."
+
+The franchise is a potential power, making it theoretically possible for
+the electorate to take possession of the country. In practice, the
+franchise has had no such result. Quite the contrary, the masters of
+American life by a policy of chicanery and misrepresentation, advertise
+and support first one and then the other of the "Old Parties," both of
+which are led by the members of the propertied class or by their
+retainers. The people, deluded by the press, and ignorant of their real
+interests, go to the polls year after year and vote for representatives
+that represent, in all of their interests, the special privileged
+classes.
+
+The economic and social reorganization of the United States during the
+past fifty years has gone fast and far. The system of perpetual (fee
+simple) private ownership of the resources has concentrated the control
+over the natural resources in a small group, not of individuals,
+but of corporations; has created a new form of social master, in
+the form of a land-tool-job owner; has thus made possible a type of
+absentee-landlordism more effective and less human than were any of its
+predecessors and has decreased the responsibility at the same time that
+it has augmented the power of the owning group. These changes have been
+an integral part of a general economic transformation that has occupied
+the chief energies of the ablest men of the community for the past two
+generations.
+
+The country of many farms, villages and towns, and of a few cities, with
+opportunity free and easy of access, has become a country of highly
+organized concentrated wealth power, owned by a small fraction of the
+people and controlled by a tiny minority of the owners for their benefit
+and profit. The country which was rightfully called "our United States"
+in 1840, by 1920 was "their United States" in every important sense of
+the word.
+
+FOOTNOTES:
+
+[39] "Estimated Valuation of National Wealth, 1850-1912," Bureau of the
+Census, 1915, p. 15.
+
+[40] "Addresses of President Wilson," House Doc. 803. Sixty-fourth
+Congress, 1st Session (1916), p. 13.
+
+
+
+
+IX. THE DIVINE RIGHT OF PROPERTY
+
+
+1. _Land Ownership and Liberty_
+
+The owners of American wealth have been molded gradually into a ruling
+class. Years of brutal, competitive, economic struggle solidified their
+ranks,--distinguishing friend from enemy; clarifying economic laws, and
+demonstrating the importance of coordination in economic affairs.
+Economic control, once firmly established, opened before the wealth
+owning class an opportunity to dominate the entire field of public life.
+
+Before the property owners could feel secure in their possessions, steps
+must be taken to transmute the popular ideas regarding "property rights"
+into a public opinion that would permit the concentration of important
+property in the hands of a small owning class, at the same time that it
+held to the conviction that society, without privately owned land and
+machinery, was unthinkable.
+
+Many of the leading spirits among the colonists had come to America in
+the hope of realizing the ideal of "Every man a farm, and every farm a
+man." Upon this principle they believed that it would be possible to set
+up the free government which so many were seeking in those dark days of
+the divine right of kings.
+
+For many years after the organization of the Federal Government men
+spoke of the public domain as if it were to last indefinitely. As late
+as 1832 Henry Clay, in a discussion of the public lands, could say, "We
+should rejoice that this bountiful resource possessed by our country,
+remains in almost undiminished quantity." Later in the same speech he
+referred to the public lands as being "liberally offered,--in
+exhaustless quantities, and at moderate prices, enriching individuals
+and tending to the rapid improvement of the country."[41]
+
+The land rose in price as settlers came in greater numbers. Land booms
+developed. Speculation was rife. Efforts were made to secure additional
+concessions from the Government. It was in this debate, where the public
+land was referred to as "refuse land" that Henry Clay felt called upon
+to remind his fellow-legislators of the significance and growing value
+of the public land. He said, "A friend of mine in this city bought in
+Illinois last fall about two thousand acres of this refuse land at the
+minimum price, for which he has lately refused six dollars per acre....
+It is a business, a very profitable business, at which fortunes are made
+in the new states, to purchase these refuse lands and without improving
+them to sell them at large advances."[42]
+
+A century ago, while it was still almost a wilderness, Illinois began to
+feel the pressure of limited resources--a pressure which has increased
+to such a point that it has completely revolutionized the system of
+society that was known to the men who established the Government of the
+United States.
+
+This early record of a mid-western land boom, with Illinois land at six
+dollars an acre, tells the story of everything that was to follow. Even
+in 1832 there was not enough of the good land to go around. Already the
+community was dividing itself into two classes--those who could get good
+land and those who could not. A wise man, understanding the part played
+by economic forces in determining the fate of a people, might have said
+to Henry Clay on that June day in 1832, "Friend, you have pronounced the
+obituary of American liberty."
+
+Some wise man might have spoken thus, but how strange the utterance
+would have sounded! There was so much land, and all history seemed to
+guarantee the beneficial results that are derived from individual land
+ownership. The democracies of Greece and Rome were built upon such a
+foundation. The yeomanry of England had proved her pride and stay. In
+Europe the free workers in the towns had been the guardians of the
+rights of the people. Throughout historic times, liberty has taken root
+where there is an economic foundation for the freedom which each man
+feels he has a right to demand.
+
+
+2. _Security of "Acquisitions"_
+
+Feudal Europe depended for its living upon agriculture. The Feudal
+System had concentrated the ownership of practically all of the valuable
+agricultural land in the hands of the small group of persons which ruled
+because it controlled economic opportunity. The power of this class
+rested on its ownership of the resource upon which the majority of the
+people depended for a livelihood.
+
+The Feudal System was transplanted to England, but it never took deep
+root there. When in 1215 A. D. (only a century and a half after the
+Great William had made his effort to feudalize England) King John signed
+the Magna Carta, Feudalism proper gave way to landlordism--the basis of
+English economic life from that time to this.
+
+The system of English landlordism (which showed itself at its worst in
+the absentee landlordism of Ireland) differed from Feudalism in this
+essential respect,--Feudalism was based upon the idea of the divine
+right of kings. English landlordism was based on the idea of divine
+right of property. English landlordism is the immediate ancestor of the
+property concept that is universally accepted in the business world of
+to-day.
+
+The evils of Feudalism and of landlordism were well known to the
+American colonists who were under the impression that they arose not
+from the fact of ownership, but from the concentration of ownership. The
+resources of the new world seemed limitless, and the possibility that
+landlordism might show its ugly head on this side of the Atlantic was
+too remote for serious consideration.
+
+With the independence of the United States assured after the War of
+1812; with the growth of industry, and the coming of tens of thousands
+of new settlers, the future of democracy seemed bright. Daniel Webster
+characterized the outlook in 1821 by saying, "A country of such vast
+extent, with such varieties of soil and climate, with so much public
+spirit and private enterprise, with a population increasing so much
+beyond former examples, ... so free in its institutions, so mild in its
+laws, so secure in the title it confers on every man to his own
+acquisitions,--needs nothing but time and peace to carry it forward to
+almost any point of advancement."[43]
+
+"So free in its institutions, so mild in its laws, so secure in the
+title it confers on every man to his own acquisitions,"--the words were
+prophetic. At the moment when they were uttered the forces were busy
+that were destined to realize Webster's dream, on an imperial scale, at
+the expense of the freedom which he prized. Men were free to get what
+they could, and once having secured it, they were safeguarded in its
+possession. Property ownership was a virtue universally commended.
+Constitutions were drawn and laws were framed to guarantee to property
+owners the rights to their property, even in cases where this property
+consisted of the bodies of their fellow men.
+
+The movement toward the protection of property rights has been
+progressive. Webster as a representative of the dominant interests of
+the country a hundred years ago rejoiced that every man had a secure
+title to "his own acquisitions," at a time when the property of the
+country was generally owned by those who had expended some personal
+effort in acquiring it. It was a long step from these personal
+acquisitions to the tens of billions of wealth in the hands of
+twentieth century American corporations. Daniel Webster helped to bridge
+the gap. He was responsible, at least in part, for the Dartmouth College
+Decision (1816) in which the Supreme Court ruled that a charter, granted
+by a state, is a contract that cannot be modified at will by the state.
+This decision made the corporation, once created and chartered, a free
+agent. Then came the Fourteenth Amendment with its provision that "no
+state shall make or enforce any law which shall abridge the privileges
+or immunities of citizens of the United States; nor shall any state
+deprive any person of life, liberty or property, without due process of
+law." The amendment was intended to benefit negroes. It has been used to
+place property ownership first among the American beatitudes.
+
+Corporations are "persons" in the eyes of the law. When the state of
+California tried to tax the property of the Southern Pacific Railroad at
+a rate different from that which it imposed on persons, the Supreme
+Court declared the law unconstitutional. This decision, coupled with
+that in the Dartmouth College Case secured for a corporation "the same
+immunities as any other person; and since the charter creating a
+corporation is a contract, whose obligation cannot be impaired by the
+one-sided act of a legislature, its constitutional position, as property
+holder, is much stronger than anywhere in Europe." These decisions "have
+had the effect of placing the modern industrial corporation in an almost
+impregnable constitutional position."[44]
+
+Surrounded by constitutional guarantees, armed with legal privileges and
+prerogatives and employing the language of liberty, the private property
+interests in the United States have gone forward from victory to
+victory, extending their power as they increased and concentrated their
+possessions.
+
+
+3. _Safeguarding Property Rights_
+
+The efforts of Daniel Webster and his contemporaries to protect
+"acquisitions" have been seconded, with extraordinary ability, by
+business organizers, accountants, lawyers and bankers, who have
+broadened the field of their endeavors until it includes not merely
+"acquisitions," but all "property rights." Daniel Webster lived before
+the era of corporations. He thought of "acquisitions" as property
+secured through the personal efforts of the human being who possessed
+it. To-day more than half of the total property and probably more than
+three-quarters of productive wealth is owned by corporations. It
+required ability and foresight to extend the right of "acquisitions" to
+the rights of corporate stocks and bonds. The leaders among the property
+owners possessed the necessary qualifications. They did their work
+masterfully, and to-day corporate property rights are more securely
+protected than were the rights of acquisitions a hundred years ago.
+
+The safeguards that have been thrown about property are simple and
+effective. They arose quite naturally out of the rapidly developing
+structure of industrialism.
+
+_First_--There was an immense increase in the amount of property and of
+surplus in the hands of the wealth-owning class. After the new industry
+was brought into being with the Industrial Revolution, economic life no
+longer depended so exclusively upon agricultural land. Coal, iron,
+copper, cement, and many other resources could now be utilized, making
+possible a wider field for property rights. Again, the amount of surplus
+that could be produced by one worker, with the assistance of a machine,
+was much greater than under the agricultural system.
+
+_Second_--The new method of conducting economic affairs gave the
+property owners greater security of possession. Property holders always
+have been fearful that some fate might overtake their property, forcing
+them into the ranks of the non-possessors. When property was in the form
+of bullion or jewels, the danger of loss was comparatively great. The
+Feudal aristocracy, with its land-holdings, was more secure.
+Land-holdings were also more satisfactory. Jewels and plate do not pay
+any rent, but tenants do. Thus the owner of land had security plus a
+regular income.
+
+The corporation facilitated possession by providing a means (stocks and
+bonds) whereby the property owner was under no obligation other than
+that of clipping coupons or cashing interest checks upon "securities"
+that are matters of public record; issued by corporations that make
+detailed financial reports, and that are subject to vigorous public
+inspection and, in the cases of banks and other financial organizations,
+to the most stringent regulation.
+
+_Third_--Greater permanence has been secured for property advantages.
+Corporations have perpetual, uninterrupted life. The deaths of persons
+do not affect them. The corporation also overcame the danger of the
+dissipation of property in the process of "three generations from shirt
+sleeves to shirt sleeves." The worthless son of the thrifty parent may
+still be able to squander his inheritance, but that simply means a
+transfer of the title to his stocks and bonds. The property itself
+remains intact.
+
+_Fourth_--Property has secured a claim on income that is, in the last
+analysis, prior to the claim of the worker.
+
+When a man ran his own business, investing his capital, putting back
+part of his earnings, and taking from the business only what he needed
+for his personal expenses, "profits" were a matter of good fortune.
+There were "good years" and "bad years," when profits were high or low.
+Many years closed with no profit at all. The average farmer still
+handles his business in that way.
+
+The incorporation of business, and the issuing of bonds and stocks has
+revolutionized this situation. It is no longer possible to "wait till
+things pick up." If the business has issued a million in bonds, at five
+per cent, there is an interest charge of $50,000 that must be met each
+year. There may be no money to lay out for repairs and needed
+improvements, but if the business is to remain solvent, it must pay the
+interest on its bonds.
+
+Businesses that are issuing securities to the public face the same
+situation with regard to their stocks. Wise directors see to it that a
+regular rate, rather than a high rate of dividends, is paid. Regularity
+means greater certainty and stability, hence better consideration from
+the investing public.
+
+_Fifth_--The practices of the modern economic world have gone far to
+increase the security of property rights.
+
+Business men have worked ardently to "stabilize" business. They have
+insisted upon the importance of "business sanity;" of conservatism in
+finance; of the returns due a man who risks his wealth in a business
+venture; and of the fundamental necessity of maintaining business on a
+sound basis. After centuries of experiment they have evolved what they
+regard as a safe and sane method of financial business procedure. Every
+successful business man tried to live up to the following
+well-established formula.
+
+First, he pays out of his total returns, or gross receipts, the ordinary
+costs of doing business--materials, labor, repairs and the like. These
+payments are known as running expenses or up-keep.
+
+Second, after up-keep charges are paid he takes the remainder, called
+gross income, and pays out of it the fixed charges--taxes, insurance,
+interest and depreciation.
+
+Third, the business man, having paid all of the necessary expenses of
+doing business (the running expenses and the fixed charges), has left a
+fund (net income) which, roughly speaking, is the profits of the
+business. Out of this net income, dividends are paid, improvements and
+extensions of the plant are provided for.
+
+Fourth, the careful business man increases the stability of his
+business by adding something to his surplus or undivided profits.
+
+The operating statistics of the United Steel Corporation for 1918
+illustrate the principle:
+
+
+     1. Gross Receipts                         $1,744,312,163
+       Manufacturing and Operating expenses
+       including ordinary repairs               1,178,032,665
+                                              ---------------
+     2. Gross Earnings                         $  566,279,498
+       Other income                                40,474,823
+                                              ---------------
+                                               $  606,754,321
+
+       General Expense, (including commission
+       and selling expense, taxes, etc.)          337,077,986
+       Interest, depreciation, sinking fund, etc. 144,358,958
+                                               --------------
+     3. Net Income                             $  125,317,377
+       Dividends                                   96,382,027
+                                               --------------
+     4. Surplus for the year                   $   28,935,350
+       Total surplus                              460,596,154
+
+
+Like every carefully handled business, the Steel Corporation,--
+
+
+     1. Paid its running expenses,
+     2. Paid its fixed obligations,
+     3. Divided up its profits,
+     4. And kept a nest egg.
+
+
+The effectiveness of such means of stabilizing property income is
+illustrated by a compilation (published in the _Wall Street Journal_ for
+August 7th, 1919) of the business of 104 American corporations between
+December 31, 1914, and December 31, 1918. The inventories--value of
+property owned--had increased from 1,192 millions to 2,624 millions of
+dollars; the gain in surplus, during the four years, was 1,941
+millions; the increase in "working capital" was 1,876 millions. These
+corporations, representing only a small fraction of the total business
+of the country, had added billions to their property values during the
+four years.
+
+These various items,--up-keep; depreciation; insurance; taxes; interest;
+dividends and surplus,--are recognized universally by legislatures and
+courts as "legitimate" outlays. They, therefore, are elements that are
+always present in the computation of a "fair" price. The cost to the
+consumer of coffee, shoes, meat, blankets, coal and transportation are
+all figured on such a basis. Hence, it will be seen that each time the
+consumer buys a pair of shoes or a pound of meat, he is paying, with
+part of his money, for the stabilizing of property.
+
+Fifth. Property titles under this system are rendered immortal. A
+thousand dollars, invested in 1880 in 5 per cent. 40 year bonds, will
+pay to the owner $2,000 in interest by 1920, at which time the owner
+gets his original thousand back again to be re-invested so long as he
+and his descendants care to do so. The dollar, invested in the business
+of the steel corporation, by the technical processes of bookkeeping, is
+constantly renewed. Not only does it pay a return to the owner, but
+literally, it never dies.
+
+The community is built upon labor. Its processes are continued and its
+wealth is re-created by labor. The men who work on the railroad keep the
+road operating; those who own the railroad owe to it no personal fealty,
+and perform upon it no personal service. If the worker dies, the train
+must stop until he is replaced; if the owner dies, the clerk records a
+change of name in the registry books.
+
+The well-ordered society will encourage work. It will aim to develop
+enthusiasm, to stimulate activity. Nevertheless, in "practical America"
+a scheme of economic organization is being perfected under which the
+cream of life goes to the owners. They have the amplest opportunities.
+They enjoy the first fruits.
+
+
+4. _Property Rights and Civilization_
+
+Under these circumstances, it is easy to see how "the rights of
+property" soon comes to mean the same thing as "civilization," and how
+"the preservation of law and order" is always interpreted as the
+protection of property. With a community organized on a basis which
+renders property rights supreme in all essential particulars, it is but
+natural that the perpetuation of these rights should be regarded as the
+perpetuation of civilization itself.
+
+The present organization of economic life in the United States permits
+the wealth owners through their ownership to live without doing any work
+upon the work done by their fellows. As recipients of property income
+(rent, interest and dividends) they have a return for which they need
+perform no service,--a return that allows them to "live on their
+income."
+
+The man who fails to assist in productive activity gives nothing of
+himself in return for the food, clothing and shelter which he
+enjoys,--that is, he lives on the labor of others. Where some have sowed
+and reaped, hammered and drilled, he has regaled himself on the fruits
+of their toil, while never toiling himself.
+
+The matter appears most clearly in the case of an heir to an estate. The
+father dies, leaving his son the title deeds to a piece of city land. If
+he has no confidence in his son's business ability or if his son is a
+minor, he may leave the land in trust, and have it administered in his
+son's interest by some well organized trust company. The father did not
+make the land, though he did buy it. The son neither made nor bought the
+land, it merely came to him; and yet each year he receives a
+rent-payment upon which he is able to live comfortably without doing any
+work. It must at once be apparent that this son of his father,
+economically speaking, performs no function in the community, but merely
+takes from the community an annual toll or rental based on his ownership
+of a part of the land upon, which his fellowmen depend for a living. Of
+what will this toll consist? Of bread, shoes, motor-cars, cigars, books
+and pictures,--the products of the labor of other men.
+
+This son of his father is living on his income,--supported by the labor
+of other people. He performs no labor himself, and yet he is able to
+exist comfortably in a world where all of the things which are consumed
+are the direct or indirect product of the labor of some human being.
+
+Living on one's income is not a new social experience, but it is
+relatively new in the United States. The practice found a reasonably
+effective expression in the feudalism of medieval Europe. It has been
+brought to extraordinary perfection under the industrialism of Twentieth
+Century America.
+
+Imagine the feelings of the early inhabitants of the American colonies
+toward those few gentlemen who set themselves up as economically
+superior beings, and who insisted upon living without any labor, upon
+the labor performed by their fellows. It was against the suggestion of
+such a practice that Captain John Smith vociferated his famous "He that
+will not work, neither shall he eat." The suggestion that some should
+share in the proceeds of community life without participating in the
+hardships that were involved in making a living seemed preposterous in
+those early days.
+
+To-day, living on one's income is accepted in every industrial center of
+the United States as one of the methods of gaining a livelihood. Some
+men and women work for a living. Other men and women own for a living.
+
+Workers are in most cases the humble people of the community. They do
+not live in the finest homes, eat the best food, wear the most elaborate
+clothing, or read, travel and enjoy the most of life.
+
+The owners as a rule are the well-to-do part of the community. They
+derive much of all of their income from investments. The return which
+they make to the community in services is small when compared with the
+income which they receive from their property holdings.
+
+Living on one's income is becoming as much a part of American economic
+life as living by factory labor, or by mining, or by manufacturing, or
+by any other occupation upon which the community depends for its
+products. The difference between these occupations and living on one's
+income is that they are relatively menial, and it is relatively
+respectable, that is, they have won the disapprobation and it has won
+the approbation of American public opinion.
+
+The best general picture of the economic situation that permits a few
+people to live on their incomes, while the masses of the people work for
+a living, is contained in the reports of the Federal Commissioner of
+Internal Revenue. The figures for 1917 ("Statistics of Income for 1917"
+published August 1919) show that 3,472,890 persons filed returns, making
+one for each six families in the United States. Almost one half of the
+total number of returns made in 1917 were from persons whose income was
+between $1000 and $2000. There were 1,832,132 returns showing incomes of
+$2000 or more, one for each twelve families in the country.
+
+The number of persons receiving the higher incomes is comparatively
+small. There were 270,666 incomes between $5,000 and $10,000; 30,391
+between $10,000 and $25,000; 12,439 between $25,000 and $50,000. There
+were 432,662 returns (22 for each 1000 families in the United States)
+showing incomes of $5,000 or over; there were 161,996 returns (8 returns
+for each 1000 families) showing incomes of $10,000 or over; 49,494
+showing incomes of $25,000 and over; 19,103 showing incomes of $50,000
+and more. Thus the number of moderate and large incomes, compared with
+the total population of the country, was minute.
+
+The portion of the report that is of particular interest, in so far as
+the present study is concerned, is that which presents a division of the
+total net income of those reporting $2,000 or more, into three
+classes--income from personal service, income from business profits and
+income from the ownership of property.
+
+
+                 PERSONAL INCOMES BY SOURCES--1917
+
+                                      _Amount of_    _Per Cent_
+                                      _Income_       _of Total_
+               _Source_                               _Income_
+     1. Income from personal service;
+     salaries, wages; commission,
+     bonuses, director's
+     fees, etc                         $ 3,648,437,902   30.21
+
+     2. Income from business; business,
+     trade, commerce,
+     partnership, farming, and
+     profits from sales of real
+     estate, stocks, bonds, and
+     other property                      3,958,670,028   32.77
+
+     3. Income from property; rents
+     and royalties                         684,343,399    5.67
+     Interest on bonds, notes, etc.        936,715,456    7.76
+     Dividends                           2,848,842,499   23.59
+     Total from Property                 4,469,901,354   37.02
+
+     4. Total income                    12,077,009,284  100.00
+
+
+Those persons who have incomes of $2,000 or more receive 30 cents on the
+dollar in the form of wages and salaries; 33 cents in the form of
+business profits, and 37 cents in the form of incomes from the ownership
+of property. The dividend payments alone--to this group of property
+owners, are equal to three quarters of the total returns for personal
+service.
+
+These figures refer, of course, to all those in receipt of $2,000 or
+more per year. Obviously, the smaller incomes are in the form of wages,
+salaries, and business profits, while the larger incomes take the form
+of rent, interest and dividends. This is made apparent by a study of the
+detailed tables published in connection with the "Income Statistics for
+1916."
+
+Among those of small incomes--$5,000 to $10,000--nearly half of the
+income was derived from personal services. The proportion of the income
+resulting from personal service diminished steadily as the incomes rose
+until, in the highest income group--those receiving $2,000,000 or more
+per year, less than one-half of one per cent. was the result of personal
+service while more than 99 per cent. of the incomes came from property
+ownership.
+
+A small portion of the American people are in receipt of incomes that
+necessitate a report to the revenue officers. Among those persons, a
+small number are in receipt of incomes that might be termed
+large--incomes of $10,000 or over, for example. Among these persons with
+large incomes the majority of the income is secured in the form of rent,
+interest, dividends and profits. The higher the income group, the larger
+is the percentage of the income that comes from property holdings.
+
+The economic system that exists at the present time in the United States
+places a premium on property ownership. The recipients of the large
+incomes are the holders of the large amounts of property.
+
+Large incomes are property incomes. The rich are rich because they are
+property owners. Furthermore, the organization of present-day business
+makes the owner of property more secure--far more secure in his income,
+than is the worker who produces the wealth out of which the property
+income is paid.
+
+
+5. _Plutocracy_
+
+The owning class in the United States is established on an economic
+basis,--the private ownership of the earth. No more solid foundation for
+class integrity and class power has ever been discovered.
+
+The owners of the United States are powerfully entrenched. Operating
+through the corporation, its members have secured possession of the bulk
+of the more useful resources, the important franchises and the
+productive capital. Where they do not own outright, they control. The
+earth, in America, is the landlords and the fullness thereof. They own
+the productive machinery, and because they own they are able to secure a
+vast annual income in return for their bare ownership.
+
+Families which enjoy property income have one great common
+interest--that of perpetuating and continuing the property income; hence
+the "cohesion of wealth." "The cohesion of wealth" is a force that welds
+individuals and families who receive property income into a unified
+group or class.
+
+The cohesion of wealth is a force of peculiar social significance. It
+might perhaps be referred to as the class consciousness of the wealthy
+except that it manifests itself among people who have recently acquired
+wealth, more violently, in some cases, than it appears among those whose
+families have possessed wealth for generations. Then, the cohesion of
+wealth is not always an intelligent force. In the case of some persons
+it is largely instinctive.
+
+Originally, the cohesion of wealth expresses itself instinctively among
+a group of wealth owners. They may be competing fiercely as in the case
+of a group of local banks, department stores, or landlords, but let a
+common enemy appear, with a proposition for currency reform, labor
+legislation or land taxation and in a twinkling the conflicting
+interests are thrown to the winds and the property owners are welded
+into a coherent, unified group. This is the beginning of a wealth
+cohesion which develops rapidly into a wealth consciousness.
+
+American business, a generation ago, was highly competitive. Each
+business man's hand was raised against his neighbor and the downfall of
+one was a matter of rejoicing for all. The bitter experience of the
+nineties drove home some lessons; the struggles with labor brought some
+more; the efforts at government regulations had their effect; but most
+of all, the experience of meeting with men in various lines of business
+and discussing the common problems through the city, state and national
+and business organizations led to a realization of the fact that those
+who owned and managed business had more in common than they had in
+antagonism. By knifing one another they made themselves an easy prey for
+the unions and the government. By pooling ideas and interests they
+presented a solid front to the demands of organized labor and the
+efforts of the public to enforce regulation.
+
+"Plutocracy" means control by those who own wealth. The "plutocratic
+class" consists of that group of persons who control community affairs
+because they own property. This class, because of its property
+ownership, is compelled to devote time and infinite pains to the task of
+safeguarding the sacred rights of property. It is to that task that the
+leaders of the American plutocracy have committed themselves, and it is
+from the results of that accomplished work that they are turning to new
+labors.
+
+FOOTNOTES:
+
+[41] Speech in the Senate, June 20, 1832. Works Colvin Colton, ed. New
+York, Putnam's, 1904, vol. 7, p. 503.
+
+[42] Ibid., p. 503.
+
+[43] "Speeches," E. P. Whipple, ed. Little, Brown & Co., 1910, pp.
+59-60.
+
+[44] "The Constitutional Position of Property in America," Arthur T.
+Hadley, _Independent_, April 16, 1908.
+
+
+
+
+X. INDUSTRIAL EMPIRES
+
+
+1. _They Cannot Pause!_
+
+The foundations of Empire have been laid in the United States. Territory
+has been conquered; peoples have been subjugated or annihilated; an
+imperial class has established itself. Here are all of the essential
+characteristics of empire.
+
+The American people have been busy laying the political foundations of
+Empire for three centuries. A great domain, taken by force of arms from
+the people who were in possession of it has been either incorporated
+into the Union, or else held as dependent territory. The aborigines have
+disappeared as a race. The Negroes, kidnaped from their native land,
+enslaved and later liberated, are still treated as an inferior people
+who should be the hewers of wood and the drawers of water. A vast
+territory was taken from Mexico as a result of one war. A quarter
+million square miles were secured from Spain in another; on the
+Continent three and a half millions of square miles; in territorial
+possessions nearly a quarter of a million more--this is the result of
+little more than two hundred years of struggle; this is the geographic
+basis for the American Empire.
+
+The structure of owning class power is practically complete in the
+United States. Through long years the business interests have evolved a
+form of organization that concentrates the essential power over the
+industrial and financial processes in a very few hands,--the hands of
+the investment bankers. During this contest for power the plutocracy
+learned the value of the control of public opinion, and brought the
+whole machinery for the direction of public affairs under its
+domination. Thus political and social institutions as well as the
+processes of economic life were made subject to plutocratic authority.
+A hundred years has sufficed to promulgate ideas of the sacredness of
+private property that place its preservation and protection among the
+chief duties of man. Economic organization; the control of all important
+branches of public affairs, and the elevation of property rights to a
+place among the beatitudes--by these three means was the authority of
+the plutocracy established and safeguarded.
+
+Since economic political and social power cover the field of authority
+that one human being may exercise over another, it might be supposed
+that the members of the plutocratic class would pause at this point and
+cease their efforts to increase power. But the owners cannot pause! A
+force greater than their wills compels them to go on at an ever growing
+speed. Within the vitals of the economic system upon which it subsists
+the plutocracy has found a source of never-ending torment in the form of
+a constantly increasing surplus.
+
+
+2. _The Knotty Problem of Surplus_
+
+The present system of industry is so organized that the worker is always
+paid less in wages than he creates in product. A part of this difference
+between product and wages goes to the upkeep and expansion of the
+industry in which the worker is employed. Another part in the form of
+interest, dividends, rents, royalties and profits, goes to the owners of
+the land and productive machinery.
+
+The values produced in industry and handed to the industrial worker or
+property owner in the form of income, may be used or "spent" either for
+"consumption goods"--things that are to be used in satisfying human
+wants, such as street car transportation, clothing, school books, and
+smoking tobacco; or for production goods--things that are to be used in
+the making of wealth, such as factory buildings, lathes, harvesting
+machinery, railroad equipment. Those who have small incomes necessarily
+spend the greater part for the consumption of goods upon which their
+existence depends. On the other hand, those who are in receipt of large
+incomes cannot use more than a limited amount of consumption goods.
+Therefore, they are in a position to turn part of their surplus into
+production goods. As a reward for this "saving" the system gives them
+title to an amount of wealth equal to the amount saved, and in addition,
+it grants an amount of "interest" so that the next year the recipient of
+surplus gets the regular share of surplus, and beside that an additional
+reward in the form of interest. His share of the surplus is thus
+increased. That is, surplus breeds surplus.
+
+The workers are, for the most part, spenders. The great bulk of their
+income is turned at once into consumption goods. The owners in many
+instances are capitalists who hold property for the purpose of turning
+the income derived from it into additional investments.
+
+Could the worker buy back dollar for dollar the values which he produces
+there would be no surplus in the form of rent, interest, dividends and
+profits. The present economic system is, however, built upon the
+principle that those who own the lands and the productive machinery
+should be recompensed for their mere ownership. It follows, of course,
+that the more land and machinery there is to own the greater will be the
+amount of surplus which will go to the owners. Since surplus breeds
+surplus the owners find that it pays them not to use all of their income
+in the form of consumption, but rather to invest all that they can,
+thereby increasing the share of surplus that is due them. The worker, on
+the other hand, finds that he must produce a constantly larger amount of
+wealth which he never gets, but which is destined for the payment of
+rent, interest, dividends and profits. Increased incomes yield increased
+investments. Increased investments necessitate the creation and payment
+of increased surplus. The payment of increased surplus means increased
+incomes. Thus the circle is continued--with the returns heaping up in
+the coffers of the plutocracy.
+
+Originally the surplus was utilized to free the members of the owning
+class from the grinding drudgery of daily toil, by permitting them to
+enjoy the fruits of the labor of others. Then it was employed in the
+exercise of power over the economic and social machinery. But that was
+not the end--instead it proved only the beginning. As property titles
+were concentrated in fewer and fewer hands, and the amount of property
+owned by single individuals or groups of individuals becomes greater,
+their incomes (chiefly in the form of rent, interest, dividends and
+profits) rose until by 1917 there were 19,103 persons in the United
+States who declared incomes of $50,000 or more per year, which is the
+equivalent of $1,000 per week. Among these persons 141 declared annual
+incomes of over $1,000,000. Besides these personal incomes, each
+industry which paid these dividends and profits, through its
+depreciation, amortization, replacement, new construction, and surplus
+funds was reinvesting in the industries billions of wealth that would be
+used in the creation of more wealth. The normal processes of the growth
+of the modern economic system has forced upon the masters of life the
+problem of disposing of an ever increasing amount of surplus.
+
+During prosperous periods, the investment funds of a community like
+England and the United States grow very rapidly. The more prosperous the
+nation, the greater is the demand from those who cannot spend their huge
+incomes for safe, paying investment opportunities.
+
+The immense productivity of the present-day system of industry has added
+greatly to the amount of surplus seeking investment. Each invention,
+each labor saving device, each substitution of mechanical power that
+multiplies the productive capacity of industry at the same time
+increases the surplus at the disposal of the plutocracy.
+
+The surplus must be disposed of. There is no other alternative. If hats,
+flour and gasoline are piled up in the warehouses or stored in tanks, no
+more of these commodities will be made until this surplus has been used.
+The whole economic system proceeds on the principle that for each
+commodity produced, a purchaser must be found before another unit of the
+commodity is ordered. Demand for commodities stimulates and regulates
+the machinery of production.
+
+Those in control of the modern economic system have no choice but to
+produce surplus, and once having produced it, they have no choice except
+to dispose of it. An inexorable fate drives them onward--augmenting
+their burdens as it multiplies their labors.
+
+Investment opportunities, of necessity, are eagerly sought by the
+plutocracy, since the law of their system is "Invest or perish"!
+
+Invest? Where? Where there is some demand for surplus capital--that is
+in "undeveloped countries."
+
+The necessity for disposing of surplus has imposed upon the business men
+of the world a classification of all countries as "developed" or
+"undeveloped." "Developed" countries are those in which the capitalist
+processes have gone far enough to produce a surplus that is sufficient
+to provide for the upkeep and for the normal expansion of industry. In
+"developed" countries mines are opened, factories are built, railroads
+are financed, as rapidly as needed, out of the domestic industrial
+surplus. "Undeveloped" countries are those which cannot produce
+sufficient capital for their own needs, and which must, therefore,
+depend for industrial expansion upon investments of capital from the
+countries that do produce a surplus.
+
+"Developed" countries are those in which the modern industrial system
+has been thoroughly established.
+
+The contrast between developed and undeveloped countries is made clear
+by an examination of the investments of any investing nation, such as
+Great Britain. Great Britain in 1913 was surrounded by rich, prosperous
+neighbors--France, Germany, Holland, Belgium. Each year about a billion
+dollars in English capital was invested outside of the British Isles.
+Where did this wealth go? The chief objectives of British investment,
+aside from the British Dominions and the United States, were (stated in
+millions of pounds) Argentine 320; Brazil 148; Mexico 99; Russia 67;
+France 8 and Germany 6. The wealth of Germany or France is greater than
+that of Argentine, Brazil and Mexico combined, but Germany and France
+were developed countries, producing enough surplus for their own needs,
+and, therefore, the investable wealth of Great Britain went, not to her
+rich neighbors, but to the poorer lands across the sea.
+
+Each nation that produces an investable surplus--and in the nature of
+the present economic system, every capitalist nation must some day reach
+the point where it can no longer absorb its own surplus wealth--must
+find some undeveloped country in which to invest its surplus. Otherwise
+the continuity of the capitalist world is unthinkable. Great Britain,
+Belgium, Holland, France, Germany and Japan all had reached this stage
+before the war. The United States was approaching it rapidly.
+
+
+3. _"Undeveloped Countries"_
+
+Capitalism is so new that the active struggle to secure investment
+opportunities in undeveloped countries is of the most recent origin. The
+voyages which resulted in the discovery, by modern Europeans, of the
+Americas, Australia, Japan, and an easy road to the Orient, were all
+made within 500 years. The actual processes of capitalism are products
+of the past 150 years in England, where they had their origin. In
+France, Germany, Italy and Japan they have existed for less than a
+century. The great burst of economic activity which has pushed the
+United States so rapidly to the fore as a producer of surplus wealth
+dates from the Civil War. Only in the last generation did there arise
+the financial imperialism that results from the necessity of finding a
+market for investable surplus.
+
+The struggle for world trade had been waged for centuries before the
+advent of capitalism, but the struggle for investment opportunities in
+undeveloped countries is strictly modern. The matter is strikingly
+stated by Amos Pinchot in his "Peace or Armed Peace" (Nov. 11, 1918).
+
+"If you will look at the maps following page 554 of Hazen's 'Europe
+since 1815,' or any other standard colored map showing Africa and Asia
+in 1884, you will see that, but for a few rare spots of coloration, the
+whole continent of Africa is pure white. Crossing the Red Sea into
+Arabia, Persia, Mesopotamia and Asia Minor, you will find the same or
+rather a more complete lack of color. This is merely the cartographer's
+way of showing, by tint and lack of tint, that at that time Africa and
+Western Asia were still in the hands of their native populations.
+
+"Let us now turn to the same maps thirty years later, i.e., in 1914. We
+find them utterly changed. They are no longer white, but a patch work of
+variegated hues....
+
+"From 1870 to 1900, Great Britain added to her possessions, to say
+nothing of her spheres of influence, nearly 5,000,000 square miles with
+an estimated population of 88,000,000. Within a few years after
+England's permanent occupation of Egypt, which was the signal for the
+renaissance of French colonialism, France increased hers by 3,500,000
+square miles with a population of 37,000,000, not counting Morocco added
+in 1911. Germany, whose colonialism came later, because home and nearby
+markets longer absorbed the product of her machines, brought under her
+dominion from 1884 to 1899 1,000,000 square miles with an estimated
+population of 14,000,000."
+
+This is a picture of the political effects that followed the economic
+causes summed up in the term "financial imperialism."
+
+In the seventeenth and eighteenth centuries it was the trader, dealing
+in raw stuff; in the nineteenth century it was the manufacturer,
+producing at low cost to cut under his neighbor's price. During the past
+thirty years the investment banker has occupied the foreground with his
+efforts to find safe, paying opportunities for the disposal of the
+surplus committed to his care. British bankers, French bankers, German
+bankers, Belgian bankers, Dutch bankers--all intent upon the same
+mission--because behind all, and relentlessly driving, were the
+accumulating surpluses, demanding an outlet. European bankers found that
+outlet in Africa, Asia, Australia and the Americas. The stupendous
+strides in the development of the resources in these countries would
+have been impossible but for that surplus of European capital.
+
+The undeveloped countries to-day have the same characteristics,--virgin
+resources, industrial and commercial possibilities, and in many cases
+cheap labor. This is true, for example, in China, Mexico and India. It
+is true to a less extent in South America and South Africa. The logical
+destination of capital is the point where the investment will "pay."
+
+The investor who has used up the cream of the home investment market
+turns his eyes abroad. As a recent writer has suggested, "There is a
+glamor about the foreign investment" which does not hold for a domestic
+one. Foreign investments have yielded such huge returns in the past that
+there is always a seeming possibility of wonderful gains for the future.
+The risk is greater, of course, but this is more than offset by the
+increased rate of return. If it were not so, the wealth would be
+invested at home or held idle.
+
+
+4. _The Great Investing Nations_
+
+The great industrial nations are the great investing nations. An
+agriculture community produces little surplus wealth. Land values are
+low, franchises and special privileges are negligible factors. There can
+be relatively little speculation. Changes in method of production are
+infrequent. Changes in values and total wealth are gradual. The owning
+class in an agriculture civilization may live comfortably. If it is very
+small in proportion to the total population it may live luxuriously, but
+it cannot derive great revenues such as those secured by the owning
+classes of an industrial civilization.
+
+Industrial civilization possesses all of the factors for augmenting
+surplus wealth which are lacking in agricultural civilizations. Changes
+in the forms of industrial production are rapid; special privilege
+yields rich returns and is the subject of wide speculative activity;
+land values increase; labor saving machinery multiplies man's capacity
+to turn out wealth. As much surplus wealth might be produced in a year
+of this industrial life as could have been turned out in a generation or
+a century of agricultural activity or of hand-craft industry.
+
+England, France, Germany, Holland, Belgium, Japan and the United States,
+the great industrial nations, have become the great lending nations.
+Their search for "undeveloped territory" and "spheres of influence" is
+not a search for trade, but for an opportunity to invest and exploit. If
+these nations wished to exchange cotton for coffee, or machinery for
+wheat on even terms, they could exchange with one another, or with one
+of the undeveloped countries, but they demand an outlet for surplus
+wealth--an outlet that can only be utilized where the government of the
+developed country will guarantee the investment of its citizens in the
+undeveloped territory.
+
+The investing nations either want to take the raw products of the
+undeveloped country, manufacture them and sell them back as finished
+material (the British policy in India), or else they desire to secure
+possession of the resources, franchises and other special privileges in
+the undeveloped country which they can exploit for their own profit (the
+British policy in South America).
+
+The Indians, under the British policy, are thus in relatively the same
+position as the workers in one of the industrial countries. They are
+paid for their raw material a fraction of the value of the finished
+product. They are expected to buy back the finished product, which is a
+manifest impossibility. There is thus a drastic limitation on the
+exploitation of undeveloped countries, just as there is a limitation on
+the exploitation of domestic labor. In both cases the people as
+consumers can buy back less in value than the exploiters have to sell.
+Obviously the time must come when all the undeveloped sections of the
+world have been exploited to the limit. Then surplus will go a-begging.
+
+Some of the investors in the great exploiting nations have abandoned the
+idea of making huge returns by way of the English policy in India.
+Instead the investors in every nation are buying up resources,
+franchises and concessions and other special privileges in the
+undeveloped countries and treating them in exactly the same way that
+they would treat a domestic investment. In this case the resources and
+labor of the undeveloped country are exploited for the profit of the
+foreign investor.
+
+The Roman conquerors subjugated the people politically and then exacted
+an economic return in the form of tribute. The modern imperialists do
+not bother about the political machinery, so long as it remains in
+abeyance, but content themselves with securing possession of the
+economic resources of a region and exacting a return in interest and
+dividends on the investment. Political tribute is largely a thing of the
+past. In its place there is a new form--economic tribute--which is
+safer, cheaper, and on the whole far superior to the Roman method of
+exploiting undeveloped regions.
+
+
+5. _The American Home Field_
+
+A hundred years ago the United States was an undeveloped country. Its
+resources were virgin. Its wealth possibilities were immense. Both
+domestic and foreign capitalists invested large sums in the canals, the
+railroads and other American commercial and industrial enterprises. The
+rapid economic expansion of recent years has involved the outlay of huge
+sums of new capital.
+
+The total capital invested in manufactures was 8,975 millions in 1899
+and 22,791 millions in 1914. The total of railway capital was 11,034
+millions in 1899 and 20,247 millions in 1914. Manufacturing and
+railroading alone secured a capital outlay of over 20 billions in 15
+years. Some idea of the increase in investments may be gained from the
+amount of new stocks and bonds listed annually on the New York Stock
+Exchange. The total amount of new stocks listed for the five years
+ending with 1914 was 1,420 millions; the total of new bonds was 2,226
+million. (_The Financial Review Annual_, 1918, p. 67.) The total capital
+of new companies (with an authorized capital of at least $100,000) was
+in 1918, $2,599,753,600; in 1919, $12,677,229,600, and in the first 10
+months of 1920, $12,242,577,700. (Bradstreets, Nov. 6, 1920, p. 731.)
+The figures showing the amount of stocks and bonds issued do not by any
+means exhaust the field of new capital. Reference has already been made
+to the fact that the United States Steel Corporation, between 1903 and
+1918 increased its issues of stocks and bonds by only $31,600,000,
+while, in the same time its assets increased $987,000,000. The same fact
+is illustrated, on a larger scale, in a summary (_Wall Street Journal_,
+August 7, 1919) of the finances of 104 corporations covering the four
+years, December 31, 1914, to December 31, 1918. During this time, six of
+the leading steel companies of the United States increased their working
+capital by $461,965,000 and their surplus by $617,656,000. This billion
+was taken out of the earnings of the companies. Concerning the entire
+104 corporations, the _Journal_ notes that, "After heavy expenditures
+for new construction and acquisitions, and record breaking dividends,
+they added a total of nearly $2,000,000,000 to working capital." In
+addition, these corporations, in four years, showed a gain of
+$1,941,498,000 in surplus and a gain in inventories of $1,522,000,000.
+
+Considerable amounts of capital are invested in private industry, by
+individuals and partnerships. No record of these investments ever
+appears. Farmers invest in animals, machinery and improved
+buildings--investments that are not represented by stocks or bonds.
+Again, the great corporations themselves are constantly adding to their
+assets without increasing their stock or bond issues. In these and
+other ways, billions of new capital are yearly absorbed by the home
+investment market.
+
+Although most of the enterprises of the United States have been floated
+with American capital, the investors of Great Britain, Holland, France
+and other countries took a hand. In 1913 the capitalists of Great
+Britain had larger investments in the United States than in any other
+country, or than in any British Dominion. (The U. S., 754,617,000
+pounds; Canada and Newfoundland, 514,870,000 pounds; India and Ceylon,
+378,776,000 pounds; South Africa, 370,192,000 pounds and so on.)
+(_Annals_, 1916, Vol. 68, p. 28, Article by C. K. Hobson.) The aggregate
+amount of European capital invested in the United States was
+approximately $6,500,000,000 in 1910. Of this sum more than half was
+British. ("Trade Balance of the United States," George Paisch. National
+Monetary Commission, 1910, p. 175.)
+
+By the beginning of the present century (the U. S. Steel Corporation was
+organized in 1901) the main work of organization inside of the United
+States was completed. The bankers had some incidental tasks before them,
+but the industrial leaders themselves had done their pioneer duty. There
+were corners to be smoothed off, and bearings to be rubbed down, but the
+great structural problems had been solved, and the foundations of world
+industrial empire had been laid.
+
+
+6. _Leaving the Home Field_
+
+The Spanish-American War marks the beginning of the new era in American
+business organization. This war found the American people isolated and
+provincial. It left them with a new feeling for their own importance.
+
+The worlds at home had been conquered. The transcontinental railroads
+had been built; the steel industry, the oil industry, the coal industry,
+the leather industry, the woolen industry and a host of others had been
+organized by a whole generation of industrial organizers who had given
+their lives to this task.
+
+Across the borders of the United States--almost within arm's reach of
+the eager, stirring, high-strung men of the new generation, there were
+tens of thousands of square miles of undeveloped territory--territory
+that was fabulously rich in ore, in timber, in oil, in fertility. On
+every side the lands stretched away--Mexico, the West Indies, Central
+America, Canada--with opportunity that was to be had for the taking.
+
+Opportunity called. Capital, seeking new fields for investment, urged.
+Youth, enthusiasm and enterprise answered the challenge.
+
+The foreign investments of the United States at the time of the
+Spanish-American War were negligible. By 1910 American business men had
+two billions invested abroad--$700,000,000 in Mexico; $500,000,000 in
+Canada; $350,000,000 in Europe, and smaller sums in the West Indies, the
+Philippines, China, Central and South America. In 1913 there was a
+billion invested in Mexico and an equal amount in Canada. ("Commercial
+Policy," W. S. Culbertson, New York, Appleton, 1919, p. 315.)
+
+Capital flowed out of the United States in two directions:
+
+
+     1. Toward the resources which were so abundant in certain foreign
+     countries.
+
+     2. Toward foreign markets.
+
+
+7. _Building on Foreign Resources_
+
+The Bethlehem Steel Corporation is a typical industry that has built up
+foreign connections as a means of exploiting foreign resources. The
+Corporation has a huge organization in the United States which includes
+10 manufacturing plants, a coke producing company, 11 ship building
+plants, six mines and quarries, and extensive coal deposits in
+Pennsylvania and West Virginia. The Bethlehem Steel Corporation also
+controls ore properties near Santiago, Cuba, near Nipe Bay, Cuba, and
+extensive deposits along the northern coast of Cuba; large ore
+properties at Tofo, Chile, and the Ore Steamship Corporation, a carrying
+line for Chilean and Cuban ore.
+
+The American Smelting and Refining Company is another illustration of
+expansion into a foreign country for the purpose of utilizing foreign
+resources. According to the record of the Company's properties, the
+Company was operating six refining plants, one located in New Jersey;
+one in Nebraska; one in California; one in Illinois; one in Maryland,
+and one in Washington. The Company owned 14 lead smelters and 11 copper
+smelters, located as follows: Colorado, 4; Utah, 2; Texas, 2; Arizona,
+2; New Jersey, 2; Montana, 1; Washington, 1; Nebraska, 1; California, 1;
+Illinois, 1; Chile, 2; Mexico, 6. Among these 25 plants a third is
+located outside of the United States.
+
+These are but two examples. The rubber, oil, tobacco and sugar interests
+have pursued a similar policy--extending their organization in such a
+way as to utilize foreign resources as a source for the raw materials
+that are destined to be manufactured in the United States.
+
+
+8. _Manufacturing and Marketing Abroad_
+
+The Bethlehem Steel Corporation and the American Smelting and Refining
+Company go outside of the United States for the resources upon which
+their industries depend. Their fabricating industries are carried on
+inside of the country. There are a number of the great industries of the
+country that have gone outside of the United States to do their
+manufacturing and to organize the marketing of their products.
+
+The International Harvester Company has built a worldwide organization.
+It manufactures harvesting machinery, farm implements, gasoline engines,
+tractors, wagons and separators at Springfield, Ohio; Rock Falls, Ill.;
+Chicago, Ill.; Auburn, New York; Akron, Ohio; Milwaukee, Wisc., and
+West Pullman, Ill. It has iron mines, coal mines and steel plants
+operated by the Wisconsin Steel Company. It has three twine mills and
+four railways. Foreign plants and branches are listed as follows:
+Norrkoping, Sweden; Copenhagen, Denmark; Christiania, Norway; Paris,
+France; Croix, France; Berlin, Germany; Hamilton, Ontario, Canada;
+Zurich, Switzerland; Vienna, Austria; Lubertzy, Russia; Neuss, Germany;
+Melbourne, Australia; London, England; Christ Church, New Zealand.
+
+One of the greatest industrial empires in the world is the Standard Oil
+Properties. It is not possible to go into detail with regard to their
+operations. Space will admit of a brief comment upon one of the
+constituent parts or "states" of the empire--The Standard Oil Company of
+New Jersey. With a capital stock of $100,000,000, this Company, from the
+dissolution of the Standard Oil Company, December 15, 1911, to June 15,
+1918, a period of six and a half years, paid dividends of $174,058,932.
+
+The company describes itself as "a manufacturing enterprise with a large
+foreign business. The company drills oil wells, pumps them, refines the
+crude oil into many forms and sells the product--mostly abroad." (_The
+Lamp_, May, 1918.) The properties of the Company are thus listed:
+
+1. The Company has 13 refineries, seven of them in New Jersey, Maryland,
+Oklahoma, Louisiana and West Virginia. Four of the remaining refineries
+are located in Canada, one is in Mexico and one in Peru.
+
+2. Pipeline properties in New York, New Jersey, Pennsylvania and
+Maryland.
+
+3. A fleet of 54 ocean-going tank steamers with a capacity of 486,480
+dead weight tons. (This is about two per cent of the total ocean-going
+tonnage of the world.)
+
+4. Can and case factories, barrel factories, canning plants, glue
+factories and pipe shops.
+
+5. Through its subsidiary corporations, the Company controls:
+
+a. Oil wells in Pennsylvania, West Virginia, Ohio, Kentucky, Louisiana,
+Arkansas, Mississippi, Texas, California, Peru and Mexico. In connection
+with many of these properties refineries are operated.
+
+b. One subsidiary has 550 marketing stations in Canada. Others market in
+various parts of the United States; in the West Indies; in Central and
+South America; in Germany, Austria, Roumania, the Netherlands, France,
+Denmark and Italy.
+
+The Standard Oil Company of New Jersey comprises only one part--though a
+very successful part--of the Standard Oil Group of industries. It is one
+industrial state in a great industrial empire.
+
+Foreign resources offer opportunities to the exploiter. Foreign markets
+beckon. Both calls have been heeded by the American business interests
+that are busy building the international machinery of business
+organization.
+
+
+9. _International Business and Finance_
+
+The steel, smelting, oil, sugar, tobacco, and harvester interests are
+confined to relatively narrow lines. In their wake have followed general
+business, and above all, financial activities.
+
+The American International Corporation was described by its
+vice-president (Mr. Connick) before a Senate Committee on March 1, 1918.
+"Until the Russian situation became too acute, they had offices in
+Petrograd, London, Paris, Rome, Mexico City. They sent commissions and
+agents and business men to South America to promote trade.... They were
+negotiating contracts for a thousand miles of railroad in China. They
+were practically rebuilding, you might say, the Grand Canal in China.
+They had acquired the Pacific Mail.... They then bought the New York
+Shipbuilding Corporation to provide ships for their shipping interests."
+
+By 1919 (_New York Times_, Oct. 31, 1919) the Company had acquired
+Carter Macy & Co., and the Rosin and Turpentine Export Co., and was
+interested in the International Mercantile Marine and the United Fruit
+Companies.
+
+Another illustration of the same kind of general foreign business
+appeared in the form of an advertisement inserted on the financial page
+of the _New York Times_ (July 10, 1919) by three leading financial
+firms, which called attention to a $3,000,000 note issue of the Haytian
+American Corporation "Incorporated under the laws of the State of New
+York, owning and operating sugar, railroad, wharf and public utility
+companies in the Republic of Hayti." Further, the advertisers note: "The
+diversity of the Company's operations assures stability of earnings."
+
+American manufacturers, traders and industrial empire builders have not
+gone alone into the foreign field. The bankers have accompanied them.
+
+Several of the great financial institutions of the country are
+advertising their foreign connections.
+
+The Guaranty Trust Company (_New York Times_, Jan. 10, 1919) advertises
+under the caption "Direct Foreign Banking Facilities" offering "a direct
+and comprehensive banking service for trade with all countries." These
+connections include:
+
+1. Branches in London and Paris, which are designated United States
+depositories. "They are American institutions conducted on American
+lines, and are especially well equipped to render banking service
+throughout Europe." There are additional branches in Liverpool and
+Brussels. The Company also has direct connections in Italy and Spain,
+and representatives in the Scandinavian countries.
+
+2. "Direct connections with the leading financial institutions in
+Argentina, Uruguay, Chile, and Brazil." A special representative in
+Buenos Ayres. "Through our affiliation with the Mercantile Bank of the
+Americas and its connections, we cover Peru, Northern Brazil, Columbia,
+Ecuador, Venezuela, Nicaragua, Honduras, Guatemala, and other South and
+Central American countries."
+
+3. "Through the American Mercantile Bank of Cuba, at Havana, we cover
+direct Cuba and the West Indies."
+
+4. "Direct banking and merchant service throughout British India,"
+together with correspondents in the East Indies and the Straits
+Settlements.
+
+5. "Direct connections with the National Bank of South Africa, at Cape
+Town, and its many branches in the Transvaal, Rhodesia, Natal,
+Mozambique, etc."
+
+6. Direct banking connections and a special representative in Australia
+and New Zealand.
+
+7. "Through our affiliations with the Asia Banking Corporation we
+negotiate, direct, banking transactions of every nature in China,
+Manchuria, Southeastern Siberia, and throughout the Far East. The Asia
+Banking Corporation has its main office in New York and is establishing
+branches in these important trade centers: Shanghai, Pekin, Tientsin,
+Hankow, Harbin, Vladivostok. We are also official correspondents for
+leading Japanese banks."
+
+The advertisement concludes with this statement: "Our Foreign Trade
+Bureau collects and makes available accurate and up-to-date information
+relating to foreign trade--export markets, foreign financial and
+economic conditions, shipping facilities, export technique, etc. It
+endeavors to bring into touch buyers and sellers here and abroad."
+
+The same issue of the _Times_ carries a statement of the Mercantile Bank
+of the Americas which "offers the services of a banking organization
+with branches and affiliated banks in important trade centers throughout
+Central and South America, France and Spain." The Bank describes itself
+as "an American Bank for Foreign trade." Among its eleven directors are
+the President and two Vice-Presidents of the Guaranty Trust Company.
+
+The Asia Banking Corporation, upon which the Guaranty Trust Company
+relies for its Eastern connections, was organized in 1918 "to engage in
+international and foreign banking in China, in the dependencies and
+insular possessions of the United States, and, ultimately in Siberia"
+(_Standard Corporation Service_, May-August, 1918, p. 42). The officers
+elected in August 1918, were Charles H. Sabin, President of the Guaranty
+Trust Co., President; Albert Breton, Vice-President of the Guaranty
+Trust Co., and Ralph Dawson, Assistant Secretary of the Guaranty Trust
+Company, Vice-Presidents, and Robert A. Shaw, of the overseas division
+of the Guaranty Trust Company, Treasurer. Among the directors are
+representatives of the Bankers Trust Company and of the Mercantile Bank
+of the Americas.
+
+
+10. _The National City Bank_
+
+The National City Bank of New York--the first bank in the history of the
+Western Hemisphere to show resources exceeding one billion
+dollars--illustrates in its development the cyclonic changes that the
+past few years have brought into American business circles. The National
+City Bank, originally chartered in 1812, had resources of $16,750,929 in
+1879 and of $18,214,823 in 1889. From that point its development has
+been electric. The resources of the Bank totaled 128 millions in 1899;
+280 millions in 1909; $1,039,418,324 in 1919. Between 1889 and 1899 they
+increased 600 per cent; between 1899 and 1919 they increased 700 per
+cent; during the 40 years from 1889 and 1919 the increase in resources
+exceeded six thousand per cent.
+
+The organization of the Bank is indicative of the organization of modern
+business. Among the twenty-one directors, all of whom are engaged in
+some form of business enterprise, there are the names of William
+Rockefeller, Percy A. Rockefeller, J. Ogden Armour, Cleveland H. Dodge
+of the Phelps-Dodge Corporation, Cyrus H. McCormick of the International
+Harvester Co., Philip A. S. Franklin, President of the International
+Mercantile Marine Co.; Earl D. Babst, President of the American Sugar
+Refining Co.; Edgar Palmer, President of the New Jersey Zinc Co.;
+Nathan C. Kingsbury, Vice-President of the Union Pacific Railroad Co.,
+and Frank Krumball, Chairman of the Chesapeake & Ohio Railroad Co. Some
+of the most powerful mining, manufacturing, transportation and public
+utility interests in the United States are represented, directly or
+indirectly, in this list.
+
+The domestic organization of the Bank consists of five divisions, each
+one under a vice-president. New York City constitutes the first
+division; the second division comprises New England and New York State
+outside of New York City; the three remaining divisions cover the other
+portions of the United States. Except for the size and the completeness
+of its organization, the National City Bank differs in no essential
+particulars from numerous other large banking institutions. It is a
+financial superstructure built upon a massive foundation of industrial
+enterprise.
+
+The phase of the Bank's activity that is of peculiar significance at the
+present juncture is its foreign organization, all of which has been
+established since the outbreak of the European war.
+
+The foreign business of the National City Bank is carried on by the
+National City Bank proper and the International Banking Corporation. The
+first foreign branch of the National City Bank was established at Buenos
+Aires on November 10th, 1914. On January 1st, 1919, the National City
+Bank had a total of 15 foreign branches; on December 31st, 1919, it had
+a total of 74 foreign branches.
+
+The policy of the Bank in its establishment of foreign branches is
+described thus in its "Statement of Condition, December 31st, 1919":
+"The feature of branch development during the year was the expansion in
+Cuba, where twenty-two new branches were opened, making twenty-four in
+the island. Cuba is very prosperous, as a result of the expansion of the
+sugar industry, and as sugar is produced there under very favorable
+conditions economically, and the location is most convenient for
+supplying the United States, the industry is on a sound basis, and
+relations with the United States are likely to continue close and
+friendly. Cuba is a market of growing importance to the United States,
+and the system of branches established by the Bank is designed to serve
+the trade between the two countries." The trader and the Banker are to
+work hand in hand.
+
+The National City Bank has branches in Argentina, Brazil, Belgium,
+Chile, Colombia, Cuba, Italy, Porto Rico, Russia, Siberia, Spain,
+Trinidad, Uruguay and Venezuela, all of which have been established
+since 1914.
+
+A portion of the foreign business of the National City Bank is conducted
+by the International Banking Corporation which was established in 1902
+and which became a part of the National City Bank organization in 1915.
+The International Banking Corporation has a total of twenty-eight
+branches located in California, China, England, France, India, Japan,
+Java, Dominican Republic, Philippine Islands, Republic of Panama and the
+Straits Settlements. Under this arrangement, the financial relations
+with America are made by the National City Bank proper; while those with
+Europe and Asia are in the hands of the International Banking
+Corporation and the combination provides the Bank with 75 branches in
+addition to its vast organization within the United States.
+
+The National City Bank of 1889, with its resources of eighteen millions,
+was a small affair compared with the billion dollar resources of 1920.
+Thirty years sufficed for a growth from youth to robust adulthood.
+Within five years, the Bank built up a system of foreign branches that
+make it one of the most potent States in the federation of international
+financial institutions.
+
+
+11. _Onward_
+
+Exploiters of foreign resources, manufacturers, traders and bankers have
+moved, side by side, out of the United States into the foreign field.
+Step by step they have advanced, rearing the economic structure of
+empire as they went.
+
+The business men of the United States had no choice. They could not
+pause when they had spanned the continent. Ambition called them, surplus
+compelled them, profits lured them, the will to power dominated their
+lives. As well expect the Old Guard to pause in the middle of a
+charge--even before the sunken road at Waterloo--as to expect the
+business interests of the United States to cease their efforts and lay
+down their tools of conquest simply because they had reached the ocean
+in one direction. While there were left other directions in which there
+was no ocean; while other undeveloped regions offered the possibility of
+development, an inexorable fate--the fate inherent in the economic and
+the human stuff with which they were working compelled them to cry
+"Onward!" and to turn to the tasks that lay ahead.
+
+The fathers and grandfathers of these Twentieth Century American
+Plutocrats, working coatless in their tiny factories; managing their
+corner stores; serving their local banks, and holding their minor
+offices had never dreamed of the destiny that lay ahead. No matter. The
+necessity for expansion had come and with it came the opportunity. The
+economic pressure complemented the human desire for "more." The
+structure of business organization, which was erected to conquer one
+continent could not cease functioning when that one continent was
+subdued. Rather, high geared and speeded up as it was, it was in fine
+form to extend its conquests, like the well groomed army that has come
+scatheless through a great campaign, and that longs, throughout its
+tensely unified structure to be off on the next mission.
+
+The business life of the United States came to the Pacific; touched the
+Canadian border; surged against the Rio Grande. The continent had been
+spanned; the objective had been attained. Still, the cry was "Onward!"
+
+Onward? Whither?
+
+Onward to the lands where resources are abundant and rich; onward where
+labor is plentiful, docile and cheap; onward where the opportunities
+for huge profits are met with on every hand; onward into the undeveloped
+countries of the world.
+
+The capitalists of the European nations, faced by a similar necessity
+for expansion, had been compelled to go half round the earth to India,
+to South Africa, to the East Indies, to China, to Canada, to South
+America. Close at home there was no country except Russia that offered
+great possibilities of development.
+
+The business interests of the United States were more fortunate. At
+their very doors lay the opportunities--in Canada, in Mexico, in the
+West Indies, in Central and South America. Here were countries with the
+amplest, richest resources; countries open for capitalist development.
+To be sure these investment fields had been invaded already by foreign
+capitalists--British, German, Belgian and Spanish. But at the same time
+they were surrounded by a tradition of great virility and power--the
+tradition of "America for the Americans."
+
+
+
+
+XI. THE GREAT WAR
+
+
+1. _Daylight_
+
+The work of industrial empire building had continued for less than half
+a century when the United States entered the Great War, which was one in
+a sequence of events that bound America to the wheel of destiny as it
+bound England and France and Germany and Japan and every other country
+that had adopted the capitalist method of production.
+
+The war-test revealed the United States to the world and to its own
+people as a great nation playing a mighty role in international affairs.
+Most Europeans had not suspected the extent of its power. Even the
+Americans did not realize it. Nevertheless, the processes of economic
+empire building had laid a foundation upon which the superstructure of
+political empire is reared as a matter of course. Henceforth, no one
+need ask whether the United States should or should not be an imperial
+nation. There remained only the task of determining what form American
+imperialism should take.
+
+The Great War rounded out the imperial beginnings of the United States.
+It strengthened the plutocracy at home; it gave the United States
+immense prestige abroad.
+
+The Era of Imperialism dawned upon the United States in 1898. Daylight
+broke in 1914, and the night of isolation and of international
+unimportance gave place to a new day of imperial power.
+
+
+2. _Plutocracy in the Saddle_
+
+The rapid sweep across a new continent had placed the resources of the
+United States in the hands of a powerful minority. Nature had been
+generous and private ownership of the inexhaustible wilderness seemed to
+be the natural--the obvious method of procedure.
+
+The lightning march of the American people across the continent gave
+the plutocracy its grip on the natural resources. The revolutionary
+transformations in industry guaranteed its control of the productive
+machinery.
+
+The wizards of industrial activity have changed the structure of
+business life even more rapidly than they have conquered the wilderness.
+True sons of their revolutionary ancestors, they have slashed and
+remodeled and built anew with little regard for the past.
+
+Revolutions are the stalking grounds of predatory power. Napoleon built
+his empire on the French Revolution; Cromwell on the revolt against
+tyrannical royalty in England. Peaceful times give less opportunity to
+personal ambition. Institutions are well-rooted, customs and habits are
+firmly placed, life is regulated and held to earth by a fixed framework
+of habit and tradition.
+
+Revolution comes--fiercely, impetuously--uprooting institutions,
+overthrowing traditions, tearing customs from their resting places. All
+is uncertainty--chaos, when, lo! a man on horseback gathers the loose
+strands together saying, "Good people, I know, follow me!"
+
+He does know; but woe to the people who follow him! Yet, what shall they
+do? Whither shall they turn? How shall they act? Who can be relied upon
+in this uncertain hour?
+
+The man on horseback rises in his stirrups--speaking in mighty accents
+his message of hope and cheer, reassuring, promising, encouraging,
+inspiring all who come within the sound of his voice. His is the one
+assurance in a wilderness of uncertainty. What wonder that the people
+follow where he leads and beckons!
+
+The revolutionary changes in American economic life between the Civil
+War and the War of 1914 gave the plutocrat his chance. He was the man on
+horseback, quick, clever, shrewd, farseeing, persuasive, powerful.
+Through the courses of these revolutionary changes, the Hills, Goulds,
+Harrimans, Wideners, Weyerhausers, Guggenheims, Rockefellers,
+Carnegies, and Morgans did to the American economic organization exactly
+what Napoleon did to the French political organization--they took
+possession of it.
+
+
+3. _Making the Plutocracy Be Good_
+
+The American people were still thinking the thoughts of a competitive
+economic life when the cohorts of an organized plutocracy bore down upon
+them. High prices, trusts, millionaires, huge profits, corruption,
+betrayal of public office took the people by surprise, confused them,
+baffled them, enraged them. Their first thought was of politics, and
+during the years immediately preceding the war they were busy with the
+problem of legislating goodness into the plutocracy.
+
+The plutocrats were in public disfavor, and their control of natural
+resources, banks, railroads, mines, factories, political parties, public
+offices, governmental machinery, the school system, the press, the
+pulpit, the movie business,--all of this power amounted to nothing
+unless it was backed by public opinion.
+
+How could the plutocracy--the discredited, vilified plutocracy--get
+public opinion? How could the exploiters gain the confidence of the
+American people? There was only one way--they must line up with some
+cause that would command public attention and compel public support. The
+cause that it chose was the "defense of the United States."
+
+
+4. _"Preparedness"_
+
+The plutocracy, with a united front, "went in" for the "defense of the
+United States,"--attacking the people on the side of their greatest
+weakness; playing upon their primitive emotions of fear and hate. The
+campaign was intense and dramatic, featuring Japanese invasions, Mexican
+inroads, and a world conquest by Germany.
+
+The preparedness campaign was a marvel of efficient business
+organization. Its promoters made use of every device known to the
+advertising profession; the best brains were employed, and the country
+was blanketed with preparedness propaganda.
+
+Officers of the Army and Navy were frank in insisting that the defense
+of the United States was adequately provided for. (See testimony of
+General Nelson A. Miles. _Congressional Record_, February 3, 1916, p.
+2265.) Still the preparedness campaign continued with vigor. Congressman
+Clyde H. Tavenner in his speech, "The Navy League Unmasked," showed why.
+He gave facts like those appearing in George R. Kirkpatrick's book,
+"War, What For"; in F. C. Howe's "Why War," and in J. A. Hobson's
+"Imperialism," showing that, in the words of an English authority,
+"patriotism at from 10 to 15 per cent is a temptation for the best of
+citizens."
+
+Tavenner established the connection between the preparedness campaign
+and those who were making profits out of the powder business, the nickel
+business, the copper business, and the steel business, interlocked
+through interlocking directorates; then he established the connection
+between the Navy League and the firm of J. P. Morgan & Co., 23 Wall St.,
+New York. Regarding this connection, Congressman Tavenner said, "The
+Navy League upon close examination would appear to be little more than a
+branch office of the house of J. P. Morgan & Co., and a general sales
+promotion bureau for the various armor and munition makers and the
+steel, nickel, copper and zinc interests."[45]
+
+The preparedness movement came from the business interests. It was
+fostered and financed by the plutocrats. It was their first successful
+effort at winning public confidence, and so well was it managed that
+millions of Americans fell into line, fired by the love of the flag and
+the world-old devotion to family and fireside.
+
+
+5. _Patriots_
+
+From preparedness to patriotism was an easy step. The preparedness
+advocates had evoked the spirit of the founders of American democracy
+and worked upon the emotions of the people until it was generally
+understood that those who favored preparedness were patriots.
+
+Plutocratic patriotism was accepted by the press, the pulpit, the
+college, and every other important channel of public information in the
+United States. Editors, ministers, professors and lawyers proclaimed it
+as though it were their own. Randolph Bourne, in a brilliant article
+(_Seven Arts_, July, 1917) reminds his readers of "the virtuous horror
+and stupefaction when they read the manifesto of their ninety-three
+German colleagues in defense of the war. To the American academic mind
+of 1914 defense of war was inconceivable. From Bernhardi it recoiled as
+from a blasphemy, little dreaming that two years later would find it
+creating its own cleanly reasons for imposing military service on the
+country and for talking of the rough rude currents of health and
+regeneration that war would send through the American body politic. They
+would have thought any one mad who talked of shipping American men by
+the hundreds of thousands--conscripts--to die on the fields of
+France...."
+
+The American plutocracy was magnified, deified, and consecrated to the
+task of making the world safe for democracy. Exploiters had turned
+saviors and were conducting a campaign to raise $100,000,000 for the Red
+Cross.[46] The "malefactors of great wealth," the predatory business
+forces, the special privileged few who had exploited the American people
+for generations, became the prophets and the crusaders, the keepers of
+the ark of the covenant of American democracy.
+
+Radicals who had always opposed war, ministers who had spent their lives
+preaching peace upon earth, scientists whose work had brought them into
+contact with the peoples of the whole world, public men who believed
+that the United States could do greater and better work for democracy by
+staying out of the war, were branded as traitors and were persecuted as
+zealously as though they had sided with Protestantism in Catholic Spain
+under the Inquisition.
+
+By a clever move, the plutocrats, wrapped in the flag and proclaiming a
+crusade to inaugurate democracy in Germany, rallied to their support the
+professional classes of the United States and millions of the common
+people.
+
+
+6. _Business in Control_
+
+After the declaration of war, the mobilization and direction of the
+economic war work of the government was placed in the hands of the
+Council of National Defense, an organized group of the leading business
+men. The Council consisted of six members of the President's Cabinet,
+assisted by an Advisory Commission and numerous sub-committees. The
+"Advisory Commission" of the Council (the real working body) contained
+four business men, an educator, a labor leader and a medical man. ("The
+Council of National Defense" a bulletin issued by the Council under date
+of June 28, 1917.)
+
+Each member of the Advisory Commission had a group of persons
+cooperating with him. The make-up of these various committees was
+significant. Among 706 persons listed in the original schedule of
+sub-committees, 404 were business men, 200 were professional men, 59
+were labor men, 23 were public officials and 20 were miscellaneous. It
+was only in Mr. Gompers' group that labor had any representation, and
+even there, out of 138 persons only 59 were workers or officials of
+unions, while 34 were business men and 33 professional men, so that
+among Mr. Gompers' assistants the business and professional men combined
+considerably outnumbered the labor men.
+
+The make-up of some of the sub-committees revealed the forces behind the
+Defense Council. Thus Mr. Willard's sub-committee on "Express" consisted
+of four vice-presidents, one from the American, one from the
+Wells-Fargo, one from the Southern and one from the Adams Express
+Company. His committee on "Locomotives" consisted of the Vice-President
+of the Porter Locomotive Company, the President of the American
+Locomotive Company, and the Chairman of the Lima Locomotive Corporation.
+Mr. Rosenwald's committee on "Shoe and Leather Industries" consisted of
+eight persons, all of them representing shoe or leather companies. His
+committee on "Woolen Manufactures" consisted of eight representatives of
+the woolen industry. The same business supremacy appeared in Mr.
+Baruch's committees. His committee on "Cement" consisted of the
+presidents of four of the leading cement companies, the vice-president
+of a fifth cement company, and a representative of the Bureau of
+Standards of Washington. His committee on "Copper" had the names of the
+presidents of the Anaconda Copper Company, the Calumet & Hecla Mining
+Company, the United Verde Copper Company and the Utah Copper Company.
+His committee on "Steel and Steel Products" consisted of Elbert H. Gary,
+Chairman of the United States Steel Corporation; Charles M. Schwab, of
+the Bethlehem Steel Company; A. C. Dinkey, Vice-President of the Midvale
+Steel Company; W. L. King, Vice-President of Jones & Loughlin Steel
+Company, and J. A. Burden, President of the Burden Steel Company. The
+four other members of the committee represented the Republic Iron and
+Steel Company, the Lackawanna Steel Company, the American Iron and Steel
+Institute and the Picklands, Mather Co., of Cleveland. Perhaps the most
+astounding of all the committees was that on "Oil." The chairman was the
+President of the Standard Oil Company, and the secretary of the
+committee gives his address as "26 Broadway," the address of the
+Standard Oil Company. The other nine members of the committee were oil
+men from various parts of the country. What thinking American would have
+suggested, three years before, that the Standard Oil Company would be
+officially directing a part of the work of the Federal Government?
+
+Comment is superfluous. Every great industrial enterprise of the United
+States had secured representation on the committees of business men that
+were responsible for the direction of the economic side of war making.
+
+Then came the Liberty Loan campaigns and Red Cross drives, the direction
+of which also was given into the hands of experienced business men. In
+each community, the leaders in the business world were the leaders in
+these war-time activities. Since the center of business life was the
+bank, it followed that the directing power in all of the war-time
+campaigns rested with the bankers, and thus the whole nation was
+mobilized under the direction of its financiers.
+
+The results of these experiences were far-reaching. During two
+generations, the people of the United States had been passing anti-trust
+laws and anti-pooling laws, the aim of which was to prevent the business
+men of the country from getting together. The war crisis not only
+brought them together, but when they did assemble, it placed the whole
+political and economic power of the nation in their hands.
+
+The business men learned, by first hand experience, the benefits that
+arise from united effort. They joined forces across the continent, and
+they found that it paid. James S. Alexander, President of the National
+Bank of Commerce (New York), tells the story from the standpoint of a
+banker (_Manchester Guardian_, January 28, 1920. Signed Article.) In a
+discussion of "the experience in cooperative action which the war has
+given American banks" he says, "The responsibility of floating the five
+great loans issued by the government, together with the work of
+financing a production of materials speeded up to meet war necessities,
+enforced a unity of action and cooperation which otherwise could hardly
+have been obtained in many years."
+
+
+7. _Economic Winnings_
+
+The war gains of the plutocracy in the field of public control were
+important, as well as spectacular. Behind them, however, were economic
+gains--little heralded, but of the most vital consequence to the future
+of plutocratic power.
+
+The war speeded production and added greatly to the national income, to
+investable surplus, to profits and thus to the economic power of the
+plutocrats.
+
+The most tangible measure of the economic advantage gained by the
+plutocracy from the war is contained in a report on "Corporate Earnings
+and Government Revenues" (Senate Document 259. 65th Congress, Second
+Session). This report shows the profits made by the various industries
+during 1917--the first war year.
+
+The report contains 388 large pages on which are listed the profits
+("percent of net income to capital stock in 1917") made by various
+concerns. A typical food producing industry--"meat packing"--lists 122
+firms (p. 95 and 365). Of these firms 31 reported profits for the year
+of less than 25 percent; 45 reported profits of 25 but under 50 percent;
+24 reported profits of 50 but under 100 percent, and 22 reported profits
+of 100 percent or more. In this case, a third of the profits were more
+than 25, but less than 50 percent, and half were 50 percent or over.
+
+Manufacturers of cotton yarns reported profits ranging slightly higher
+than those in the meat packing industry (pp. 167, 168, 379). Among the
+153 firms reporting, 21 reported profits of less than 25 percent; 61
+reported 25 but less than 50 per cent; 55 reported 50 but under 100
+percent, and 16 reported 100 percent or more.
+
+Profits in the garment manufacturing industry were lower than those in
+yarn manufacturing. Among the 299 firms reporting (pp. 171, 380) 74 gave
+their profits as less than 25 percent; 121 gave their profits as 25 but
+under 50 percent; 65 gave profits of 50 but less than 100 percent, and
+39 gave their profits as 100 percent or over.
+
+The profits of 49 Steel plants and Rolling Mills (pp. 100, 365) were
+considerably higher than profits in any of the industries heretofore
+discussed. Four firms reported profits of less than 25 percent; 13
+reported profits of 25 but less than 50 percent; 17 reported profits of
+50 but less than 100 percent, and 15 reported profits of more than 100
+percent. In this instance two-thirds of the firms show profits of 50
+percent or over.
+
+Bituminous Coal producers in the Appalachian field (340 in number, pp.
+130 and 372) report a range of profits far higher than those secured in
+the manufacturing industries. Among these 340 firms, 23 reported profits
+of less than 25 percent; 45 reported profits of 25 but under 50 percent;
+79 reported profits of 50 but under 100 percent; 135 reported profits of
+100 but under 500 percent; 21 reported profits of 500 but under 1,000
+percent, and 14 reported profits of 1,000 percent and over. In the case
+of these coal mine operators only a fourth had profits of under 50
+percent and half had profits of more than 100 percent.
+
+The profits in these five industries--food, yarn, clothing, steel and
+coal--are quite typical of the figures for the tens of thousands of
+other firms listed in Senate Document 259. Profits of less than 25
+percent are the exception. Profits of over 100 percent were reported by
+8 percent of the yarn manufacturers, by 13 percent of the garment
+manufacturers, by 18 percent of the meat packers, by 31 percent of the
+steel plants, and by 50 percent of the bituminous coal mines. A
+considerable number of profits ranged above 500 percent, or a gain in
+one year of five times the entire capital stock.
+
+When it is remembered that these figures were supplied by the firms
+involved; that they were submitted to a tremendously overworked
+department, lacking the facilities for effective checking-up; and that
+they were submitted for the purposes of heavy taxation, the showing is
+nothing less than astounding.
+
+
+8. _Winnings in the Home Field_
+
+What has the American plutocracy won at home as a result of the war? In
+two words it has gained social prestige and internal (economic)
+solidarity. Both are vital as the foundation for future assertions of
+power.
+
+The plutocracy has unified its hold upon the country as a result of the
+war. Also, it has won an important battle in its struggle with labor.
+The position held by the American plutocracy at the end of the Great War
+could hardly be stated more adequately than in a recent Confidential
+Information Service furnished by an important agency to American
+business men:
+
+
+     "SHALL VICTORS BE MAGNANIMOUS?
+
+
+"There is no doubt about it--Labor is beaten. Mr. Gompers was at his
+zenith in 1918. Since then he has steadily lost power. He has lost power
+with his own people because he is no longer able to deliver the goods.
+He can no longer deliver the goods for two reasons. For one thing, peace
+urgency has replaced war urgency and we are not willing to bid for peace
+labor as we were willing to bid for war labor. For another thing, the
+employing class is immensely more powerful than it was in 1914.
+
+"We have an organized labor force more numerous than ever before.
+Relatively twice as many workers are organized as in 1916. But this same
+labor force has lost its hold on the public. Furthermore, it is divided
+in its own camp. It fears capital. It also fears its own factions. It
+threatens, but it does not dare.
+
+"We said that the employing class was immensely more powerful than in
+1914. There is more money at its command. Eighteen thousand new
+millionaires are the war's legacy. This money capacity is more
+thoroughly unified than ever. In 1914 we had thirty-thousand banks,
+functioning to a great degree in independence of each other. Then came
+the Federal Reserve Act and gave us the machinery for consolidation and
+the emergency of five years war furnished the hammer blows to weld the
+structure into one.
+
+"The war taught the employing class the secret and the power of
+widespread propaganda. Imperial Europe had been aware of this power. It
+was new to the United States. Now, when we have anything to sell to the
+American people we know how to sell it. We have learned. We have the
+schools. We have the pulpit. The employing class owns the press. There
+is practically no important paper in the United States but is theirs!"
+
+
+9. _The Run of the World_
+
+The war gains of the American plutocracy at home were immense. Even more
+significant, from an imperial standpoint, were the international
+advantages that came to America with the war. The events of the two
+years between 1916 and 1918 gave the United States the run of the world.
+
+Destiny seemed to be bent upon hurling the American people into a
+position of world authority. First, there was the matter of credit. The
+Allies were reaching the end of their economic rope when the United
+States entered the war. They were not bankrupt, but their credit was
+strained, their industries were disorganized, their sources of income
+were narrowed, and they were looking anxiously for some source from
+which they might draw the immense volume of goods and credit that were
+necessary for the continuance of the struggle.[47]
+
+The United States was that source of supply. During the years from 1915
+to 1917, the industries of the United States were shifted gradually from
+a peace basis to a war basis. Quantities of material destined for use in
+the war were shipped to the Allies. The unusual profits made on much of
+this business were not curtailed by heavy war taxation. Thus for more
+than two years the basic industries of the United States reaped a
+harvest in profits which were actually free of taxation, at the same
+time that they placed themselves on a war basis for the supplying of
+Europe's war demand. When the United States did enter the war, she came
+with all of the economic advantages that had arisen from selling war
+material to the belligerents during two and a half years. Throughout
+those years, while the Allies were bleeding and borrowing and paying,
+the American plutocracy was growing rich.
+
+When the United States entered the war, she entered it as an ally of
+powers that were economically winded. She herself was fresh. With the
+greatest estimated wealth of any of the warring countries, she had a
+public national debt of less than one half of one percent of her total
+wealth. She had larger quantities of liquid capital and a vast economic
+surplus. As a consequence, she held the purse strings and was able,
+during the next two years, to lend to the Allied nations nearly ten
+billion dollars without straining her resources to any appreciable
+degree.
+
+The nations of Europe had been so deeply engrossed in war-making that
+they had been unable to provide themselves with the necessary food. All
+of the warring countries, with the exception of Russia, were importers
+of food in normal times. The disturbances incident to the war; the
+insatiable army demands, and the loss of shipping all had their effect
+in bringing the Allied countries to a point of critical food scarcity in
+the Winter of 1916-1917.
+
+The United States was able to meet this food shortage as easily as it
+met the European credit shortage--and with no greater sacrifice on the
+part of the American people. Then, too, with the exception of small
+amounts of food donated through relief organizations, the food that
+went to Europe was sold at fancy prices. The United States was therefore
+in a position to lay down the basic law,--"Submit or starve."
+
+With the purse strings and the larder under American control, the
+temporary supremacy of the United States was assured. She was the one
+important nation (beside Japan) that had lost little and gained much
+during the war. She was the only great nation with a surplus of credit,
+of raw materials and of food.
+
+The prosperity incident to this period is reflected in the record of
+American exports, which rose from an average of about two billions in
+the years immediately preceding the war to more than six billions in
+1917. In the same year the imports were just under three billions,
+leaving a trade balance--that is, a debt owing by foreign countries to
+the United States--of more than three billions for that one year.
+
+
+10. _Victory_
+
+The war had been in progress for nearly three years before the United
+States took her stand on the side of the Allies. At that time the flower
+of Europe's manhood had faced, for three winters, a fearful pressure of
+hardship and exposure, while millions among the non-combatants had
+suffered, starved, sickened and died. The nerves of Europe were worn and
+the belly of Europe was empty when the American soldiers entered the
+trenches. They were never compelled to bear the brunt of the conflict.
+They arrived when the Central Empires were sagging. Their mere presence
+was the token of victory.
+
+For the first time in history the Americans were matched against the
+peoples of the old world on the home ground of the old world, and under
+circumstances that were enormously favorable to the Americans. European
+capitalism had weakened itself irreparably. The United States entered
+the war at a juncture that enabled her to take the palm after she had
+already taken billions of profit without risk or loss. The gain to the
+United States was immense, beyond the possibility of present estimate.
+The rulers of the United States became, for the time being, at least,
+the economic dictators of the world.
+
+The Great War brought noteworthy advantages to the American plutocracy.
+At home its power was clinched. Among the nations, the United States was
+elevated by the war into a position of commanding importance. In a
+superficial sense, at least, the Great War "made" the plutocracy at home
+and "made" the United States among the nations.
+
+FOOTNOTES:
+
+[45] "The Navy League Unmasked," Speech of December 15, 1915,
+_Congressional Record_.
+
+[46] This campaign was conducted by H. P. Davison, one of the leading
+members of the firm of J. P. Morgan and Co. Later a great war-fund drive
+was conducted by John D. Rockefeller, Jr. Cleveland H. Dodge of the
+Phelps-Dodge corporation was treasurer of another fund.
+
+[47] J. Maynard Keynes notes the "immense anxieties and impossible
+financial requirements" of the period between the Summer of 1916 and the
+Spring of 1917. The task would soon have become "entirely hopeless" but
+"from April, 1917" the problems were "of an entirely different order."
+"The Economic Consequences of the Peace." New York, Harcourt, Brace &
+Howe, 1920, p. 273.
+
+
+
+
+XII. THE IMPERIAL HIGHROAD
+
+
+1. _A Youthful Traveler_
+
+Along the highroad that leads to empire moves the American people, in
+the heyday of its youth, sturdy, vigorous, energy-filled, replete with
+power and promise--conquerors who have swept aside the Indians, enslaved
+a race of black men, subdued a continent, and begun the extension of
+territorial control beyond their own borders. More than a hundred
+million Americans--fast losing their standards of individualism--fast
+slipping under the domination of a new-made ruling class of wealth-lords
+and plutocrats--journey, not discontentedly, along the imperial
+highroad.
+
+The preliminary work of empire-building has been accomplished--territory
+has been conquered; peoples have been subjected and a ruling class
+organized. The policy of imperialism has been accepted by the people,
+although they have not thought seriously of its consequences. They have
+set out, in good faith, as they believe, to seek for life, liberty and
+happiness. They do not yet realize that, along the road that they are
+now traveling, the journey will not be ended until they have worn
+themselves threadbare in their efforts to conquer the earth.
+
+The American people,--lacking in political experience and in world
+wisdom; ignorant of the laws of economic and social change,--have
+committed themselves, unwittingly, to the world old task of setting up
+authority over those who have no desire to accept it, and of exacting
+tribute from those who do not wish to pay it.
+
+The early stages of the journey led across a continent. The American
+people followed it eagerly. Now that the trail leads to other continents
+they are still willing to go.
+
+"Manifest destiny" is the cry of the leaders. "We are called," echo the
+followers, and the nation moves onward.
+
+There was some hesitancy among the American people during the Spanish
+War. Even the leaders were not ready then. Now the leaders are
+prepared--for markets, for trade, for investments. They are indifferent
+to political conquest, but economically they are prepared to go on--into
+Latin America; into Asia; into Europe. The war taught them the lesson
+and gave them an inkling of their power. So they move along the imperial
+highroad--followed by a people who have not yet learned to chant the
+songs of victory--but who are destined, at no very distant date, to
+learn victory's lessons and to pay victory's price. Along the path,--far
+away in the distance they see the earth like a ball, rolling at their
+feet. It is theirs if they will but reach out their hands to grasp it!
+
+
+2. _An Imperial People_
+
+This is the American people--locked in the arms of mighty economic and
+social forces; building industrial empires; compelled, by a world war,
+to reach out and save "civilization,"--capitalist civilization,--a
+people that, by its very ancestry, seems destined to follow the course
+of empire.
+
+The sons and daughters of the native born American stock are, in the
+main, the descendants of the conquering, imperial races of the modern
+world. During recent times, three great empires--Spain, France and Great
+Britain--have dominated western civilization. It was these three empires
+that were responsible for the settlement of America. The past generation
+has seen the German empire rise to a position that has enabled her to
+shake the security of the world. The Germans were among the earliest and
+most numerous settlers of the American colonies. Those who boast
+colonial ancestry boast the ancestry of conquerors. The
+Anglo-Saxon-Teutonic races, the titular masters of the modern world;
+the races that have spread their power where-ever ships sail or trade
+moves or gain offers, furnished the bulk of the early immigrants to
+America.
+
+The bulk of the early immigration to the United States was from Great
+Britain and Germany. The records of immigration (kept officially since
+1820) show that between that year and 1840 the immigrants from Europe
+numbered 594,504, among them there were 358,994 (over half) from the
+British Isles, and 159,215 from Germany, making a total from the two
+countries of 518,209, or 87 percent of the immigrants arriving in the
+twenty-year period. During the next twenty years (1840-1860) the total
+of immigrants from Europe was 4,050,159, of which the British Isles
+furnished 2,386,846 (over half) and Germany 1,386,293, making, for these
+two countries, 94 percent of the whole immigration. Even during the
+years from 1860 to 1880, 82 percent of those who migrated to the United
+States hailed from Great Britain and Germany. American immigration, from
+1820 to 1880, might, without any violence to facts, be described as
+Anglo-Teutonic, so completely does the British-German immigrant dominate
+this period.
+
+Literally, it is true that the American people have been sired by the
+masters and would-be masters of the modern earth.
+
+
+3. _A Place in the Sun_
+
+The Americans, like many another growing people, have sought a place in
+the sun--widening their boundaries; grasping at promised riches. Unlike
+other peoples they have accomplished the task without any real
+opposition. Their "promised land" lay all about them, isolated from the
+factional warfare of Europe; virgin; awaiting the master of the Western
+World.
+
+The United States has followed the path of empire with a facility
+unexampled in recent history. When has a people, caught in the net of
+imperialism, encountered less difficulty in making its imperial dream
+come true? None of the foes that the American people have encountered,
+in two centuries of expansion, have been worthy of the name. The Indians
+were in no position to withstand the onslaught of the Whites. The
+Mexicans were even less competent to defend themselves. The Spanish
+Empire crumpled, under attack, like an autumn leaf under the heel of a
+hunter. Practically for the taking, the American people secured a
+richly-stocked, compact region, with an area of three millions of square
+miles--the ideal site for the foundation of a modern civilization.
+
+The area of the United States has increased with marvelous rapidity. At
+the outbreak of the Revolution (1776) the Colonies claimed a territory
+of 369,000 square miles. The Northwest Territory (275,000 square miles)
+and the area south of the Ohio River (205,000 square miles) were added
+largely as a result of the negotiations in 1782. The official figures
+for 1800 give the total area of the United States as 892,135 square
+miles. The Louisiana Purchase (1803) added 885,000 square miles at a
+cost of 15 millions of dollars. Florida, 59,600 square miles, was
+purchased from Spain (1819) for 5 millions of dollars; Texas, 389,000
+square miles was annexed in 1845; the Oregon Country, 285,000 square
+miles, was secured by treaty in 1846; New Mexico and California, 529,000
+square miles, were ceded by Spain (1848) and a payment of 15 millions
+was made by the United States; in 1853 the Gadsen Purchase added 30,000
+square miles at a cost of ten millions of dollars. This completed the
+territorial possessions of the United States on the mainland (with the
+exception of Alaska) making a continental area of 3,026,798 square
+miles. Between 1776 and 1853 the area of the United States was increased
+more than eight fold. What other nation has been in a position to
+multiply its home territory by eight in two generations?
+
+These vast additions to the continental possessions of the United States
+were made as the result of a trifling outlay. The most serious losses
+were involved in the Mexican War when the casualties included more than
+13,000 killed and died of wounds and disease. The net money cost of the
+war did not exceed $100,000,000. In return for this outlay--including
+the annexation of Texas--the United States secured 918,000 square miles
+of land.[48]
+
+There is no way to estimate the loss of life or the money cost of the
+Indian Wars. For the most part, the troops engaged in them suffered no
+more heavily than in ordinary police duty, and the costs were the costs
+of maintaining the regular army. The total money outlay for purchases
+and indemnities was about 45 millions of dollars. Within a century the
+American people gained possession of one of the richest portions of the
+earth's surfaces--a portion equal in area to more than three times the
+combined acreage of Belgium, France, Germany, Italy, Japan and the
+British Isles[49]--in return for an outlay in money and life that would
+not have provided for one first class battle of the Great War.
+
+Additions to the territory of the country were made with equal facility
+during the period following the Civil War. Alaska was purchased from
+Russia for $7,200,000; from Spain, as a result of the War of 1898, the
+United States received the Philippines, Porto Rico, and some lesser
+islands, at the same time paying Spain $20,000,000; Hawaii was annexed
+and an indemnity of $10,000,000 was paid to Panama for the Canal strip.
+During the second half of the nineteenth century, 716,666 square miles
+were added to the possessions of the United States. The total direct
+cost of this territory in money was under forty millions. These gains
+involved no casualties with the exception of the small numbers lost
+during the Spanish-American and Philippine Wars.
+
+One hundred and thirty years have witnessed an addition to the United
+States of more than two and a half million square miles of contiguous,
+continental territory, and three-quarters of a million square miles of
+non-contiguous territory. The area of the United States in 1900 was four
+times as great as it was in 1800 and more than ten times as great as the
+area of the Thirteen Original Colonies. For the imperialist, the last
+century and a half of American history is a fairyland come true.
+
+Other empires have been won by the hardest kind of fighting, during
+which blood and wealth have been spent with a lavish hand. The empire of
+the French, finally crushed with the defeat of Napoleon, was paid for at
+such a huge price. The British Empire has been established in savage
+competition with Holland, Spain, France, Russia, the United States,
+Germany and a host of lesser powers. The empires of old--Assyria, Egypt,
+Rome--were built at an intolerable sacrifice. So terrible has been the
+cost of empire building to some of these nations that by the time they
+had succeeded in creating an empire the life blood of the people and the
+resources of the country were devoured and the empire emerged, only to
+fall an easy prey to the first strong-handed enemy that it encountered.
+
+No such fate has overtaken the United States. On the contrary her path
+has been smoothed before her feet. Inhabiting a garden spot, her immense
+territory gains in the past hundred and fifty years have been made with
+less effort than it has cost Japan to gain and hold Korea or England to
+maintain her dominion over Ireland.
+
+Once established, the old-world empire was not secure. If the territory
+that it possessed was worth having, it was surrounded by hungry-eyed
+nations that took the first occasion to band together and despoil the
+spoiler. The holding of an empire was as great a task as the building of
+empire--often greater because of the larger outlay in men and money that
+was involved in an incessant warfare. Little by little the glory faded;
+step by step militarism made its inroads upon the normal life of the
+people, until the time came for the stronger rival to overthrow the
+mighty one, or until the inrushing hordes of barbarians should blot out
+the features of civilization, and enthrone chaos once more.
+
+How different has been the fate of the people of the United States!
+Possessed of what is probably the richest, for the purposes of the
+present civilization, of any territory of equal size in the world, their
+isolation has allowed them more than a century of practical freedom from
+outside interference--a century that they have been able to devote to
+internal development. The absence of greedy neighbors has reduced the
+expense of military preparation to a minimum; the old world has failed
+to realize, until within the last few years, what were the possibilities
+of the new country; vitality has remained unimpaired, wealth has piled
+up, industry has been promoted, and on each occasion when a greater
+extent of territory was required, it has been obtained at a cost that,
+compared with the experience of other nations, must be described as
+negligible.
+
+So simple has been the process of empire building for the United States;
+so natural have been the stages by which the American Empire has been
+evolved; so little have the changes disturbed the routine of normal life
+that the American people are, for the most part, unaware of the imperial
+position of their country. They still feel, think and talk as if the
+United States were a tiny corner, fenced off from the rest of the world
+to which it owed nothing and from which it expected nothing.
+
+The American Empire has been built, as were the palaces of Aladdin, in a
+night. The morning is dawning, and the early risers who were not even
+awakened from their slumbers by the sound of hammer and engine, are
+beginning to rub their eyes, and to ask one another what is the meaning
+of this apparition, and whether it is real.
+
+
+4. _The Will to Power_
+
+The forces of America are the forces of Empire,--the geography, the
+economic organization, the racial qualities--all press in the direction
+of imperialism. There is logic behind the two centuries of conquest in
+which the American people have been engaged; there is logic in the rise
+of the plutocracy. Now it remains for the rulers of America to accept
+the implications of imperialism,--to thrill with the will to power; to
+recognize and strengthen imperial purpose; to sell imperialism to the
+American people--in other words to follow the call of manifest destiny
+and conquer the earth.
+
+The will to power is very old and very strong. Economic and social
+necessity on the one hand, and the driving pressure of human ambition
+and the love of domination on the other, have given it a front place in
+human affairs. The empires of the past were driven into being by this
+ardent force. As far back as history bears a record, one nation or tribe
+has made war on its more fortunately situated neighbor; one leader has
+made cause against his fellow ruler. The Egyptians and Carthaginians
+have conquered in Africa; the Persians, Assyrians and Babylonians
+conquered in Asia; the Macedonians, Greeks, Romans, Spanish, Dutch,
+French, and British built their empires on one or more of the five
+continents. Conqueror has succeeded conqueror, empire has followed
+empire. Spoils, domination, world power, have been the objects of their
+campaigns.
+
+Each great nation grew from small beginnings. Each arose from some
+simple form of tribal or clan organization--more or less democratic in
+its structure; containing within itself a unified life and a simple folk
+philosophy.
+
+From such plain beginnings empires have developed. The peasants, tending
+their fertile gardens along the borders of the Nile; the vine dressers
+of Italy, the husbandmen and craftsmen of France and the yeomen of Merry
+England had no desire to subjugate the world. If tradition speaks truth,
+they were slow to take upon themselves anything more than the defense of
+their own hearthstones. It was not until the traders sailed across the
+seas; not until stories were brought to them of the vast spoil to be
+had, without work, in other lands, that the peasants and craftsmen
+consented to undertake the task of conquest, subjugation and empire
+building.
+
+The plain people do not feel the will to power. They know only the
+necessities of self-defense. It is in the ambitions of the leisure
+classes that the demands of conquest have their origin. It is among them
+that men dream of world empire.[50]
+
+The plain people of the United States have no will to power at the
+present time. They are only asking to be let alone, in order that they
+may go their several ways in peace. They are babes in the world of
+international politics. For generations they have been separated by a
+great gulf of indifference from the remainder of the human race, and
+they crave the continuance of this isolation because it gives them a
+chance to engage, unmolested, in the ordinary pursuits of life.
+
+The American people are not imperialists. They are proud of their
+country, jealous of her honor, willing to make sacrifices for their dear
+ones. They are to-day where the plain folk of Egypt, Rome, France and
+England were before the will to power gripped the ruling classes of
+those countries.
+
+Far different is the position of the American plutocracy. As a ruling
+class the plutocracy feels the necessity of preserving and enlarging its
+privileges. Recently called into a position of leadership, untrained and
+in a sense unprepared, it nevertheless understands that its claim to
+consideration depends upon its ability to do what the ruling classes of
+Egypt, Rome, France and England have done--to build an empire.
+
+Almost unconsciously, out of the necessities of the period, has come the
+structure of the American Empire. In essence it is an empire, although
+the plain people do not know it, and even the members of the plutocracy
+are in many instances unaware of its true character. Yet here, in a land
+dedicated to liberty and settled by men and women who sought to escape
+from the savage struggles of empire-ridden Europe, the foundations and
+the superstructure of empire appear.
+
+1. The people of the United States have conquered and now hold
+possession of approximately three million square miles of continental
+territory that has been won by armed force from Great Britain, Mexico,
+Spain, and the American Indians. (The entire area of Europe is only
+3,800,000 square miles.)
+
+2. The people of the United States have conquered and now hold under
+their sway subject people who have enjoyed no opportunity for
+self-determination. A whole race--the African Negroes--was captured in
+its native land, transported to America and there sold into slavery. The
+inhabitants of the Philippine Islands were conquered by the armed forces
+of the United States and still are subject people.
+
+3. The United States had developed a plutocracy--a property holding
+class, that is, to all intents and purposes, the imperialist
+class--controlling and directing public policy.
+
+4. This plutocratic class is exploiting continental United States and
+its dependencies. After years of savage internal strife, it has
+developed a high degree of class consciousness, and led by its bankers,
+it is taking the fat of the land. The plutocrats, who have made the
+country their United States, are at the present moment busy disposing of
+their surplus in foreign countries. As they build their industrial
+empires, they broaden and deepen their power.
+
+Thus is the round of imperialism complete. Here are the conquered
+territory, subject people, an imperial ruling class, and the
+exploitation, by this class, of the lands and peoples that come within
+the scope of their power. These are the attributes of empire--the
+characteristics that have appeared, in one form or another, through the
+great empires of the past and of the present day. Differing in their
+forms, they remain similar in the principles that they represent. They
+are imperialism.
+
+
+5. _Imperial Purpose_
+
+The building of international industrial empires by the progressive
+business men of the United States lays the foundation for whatever
+political imperialism is necessary to protect markets, trade and
+investment. Gathering floods of economic surplus are the driving forces
+which are guided by ambition and love of gain and power.
+
+The United States emerged from the Great War in a position of
+unquestioned economic supremacy. With vast stores of all the necessary
+resources, amply equipped with capital, the country has entered the
+field as the most dangerous rival that the other capitalist nations must
+face. Possessed of everything, including the means of providing a navy
+of any reasonable size and an army of any necessary number, the United
+States looms as the dominating economic factor in the capitalist world.
+
+Imperial policy is frequently bold, rough and at times frankly brutal
+and unjust. Where subject peoples and weaker neighbors submit to the
+dictates of the ruling power there is no friction. But where the subject
+peoples or smaller states attempt to assert their rights of
+self-determination or of independence, the empire acts as Great Britain
+has acted in Ireland and in India; as Italy and France have acted in
+Africa; as Japan has acted in Korea; as the United States has acted in
+the Philippines, in Hayti, in Nicaragua, and in Mexico.
+
+Plain men do not like these things. Animated by the belief in popular
+rights which is so prevalent among the western peoples, the masses
+resent imperial atrocities. Therefore it becomes necessary to surround
+imperial action with such an atmosphere as will convince the man on the
+street that the acts are necessary or else that they are inevitable.
+
+When the Church and the State stood together the Czar and the Kaiser
+spoke for God as well as for the financial interests. There was thus a
+double sanction--imperial necessity coupled with divine authority.
+Those who were not willing to accept the necessity felt enough reverence
+for the authority to bow their heads in submission to whatever policy
+the masters of empire might inaugurate.
+
+The course of empire upon which the United States has embarked involves
+a complete departure from all of the most cherished traditions of the
+American people. Economic, political and social theories must all be
+thrust aside. Liberty, equality and fraternity must all be forgotten and
+in their places must be erected new standards of imperial purpose that
+are acceptable to the economic and political masters of present day
+American life.
+
+The American people have been taught the language of liberty. They
+believe in freedom for self-determination. Their own government was born
+as a protest against imperial tyranny and they glory in its origin and
+speak proudly of its revolutionary background. Americans are still
+individualists. Their lives and thoughts both have been
+provincial--perhaps somewhat narrow. They profess the doctrine "Live and
+let live" and in a large measure they are willing and anxious to
+practice it.
+
+How is it possible to harmonize the Declaration of Independence with the
+subjugation of peoples and the conquest of territory? If governments
+"derive their just powers from the consent of the governed," and if it
+is the right of a people to alter or to abolish any government which
+does not insure their safety and happiness, then manifestly subjugation
+and conquest are impossible.
+
+The letter and the spirit of the Declaration of Independence contradict
+the letter and spirit of imperial purpose word for word and line for
+line. There can be no harmony between these two theories of social life.
+
+
+6. _Advertising Imperialism_
+
+Since the tradition of the people of the United States and the
+necessities of imperialism are so utterly at variance, it becomes
+necessary to convince the American people that they should abandon
+their traditions and accept a new order of society, under which the will
+to power shall be substituted for liberty and fraternity. The ruling
+class of imperial Germany did this frankly and in so many words. The
+English speaking world is more adroit.
+
+The first step in the campaign to advertise and justify imperialism is
+the teaching of a blind my-country-right-or-wrong patriotism. In the
+days preceding the war the idea was expressed in the phrase, "Stand
+behind the President." The object of this teaching is to instill in the
+minds of the people, and particularly of the young, the principles of
+"Deutschland ueber alles," which, in translation, means "America first."
+There are more than twenty million children in the public schools of the
+United States who are receiving daily lessons in this first principle of
+popular support for imperial policy.
+
+Having taken this first step and made the state supreme over the
+individual will and conscience, the imperial class makes its next
+move--for "national defense." The country is made to appear in constant
+danger from attack. Men are urged to protect their homes and their
+families. They are persuaded that the white dove of peace cannot rest
+securely on anything less than a great navy and army large enough to
+hold off aggressors. The same forces that are most eager to preach
+patriotism are the most anxious about national preparedness.
+
+Meanwhile the plain people are taught to regard themselves and their
+civilization as superior to anything else on earth. Those who have a
+different language or a different color are referred to as "inferior
+peoples." The people of Panama cannot dig a canal, the people of Cuba
+cannot drive out yellow fever, the people of the Philippines cannot run
+a successful educational system, but the people of the United States can
+do all of these things,--therefore they are justified in interfering in
+the internal affairs of Panama, Cuba and the Philippines. When there is
+a threat of trouble with Mexico, the papers refer to "cleaning up
+Mexico" very much as a mother might refer to cleaning up a dirty child.
+
+Patriotism, preparedness and a sense of general superiority lead to
+that type of international snobbery that says, "Our flag is on the seven
+seas"; or "The sun never sets on our possessions"; or "Our navy can lick
+anything on earth." The preliminary work of "Education" has now been
+done; the way has been prepared.
+
+One more step must be taken, and the process of imperializing public
+opinion is complete. The people are told that the imperialism to which
+they have been called is the work of "manifest destiny."
+
+
+7. _Manifest Destiny_
+
+The argument of "manifest destiny" is employed by the strong as a
+blanket justification for acts of aggression against the weak. Each time
+that the United States has come face to face with the necessity of
+adding to its territory at the expense of some weak neighbor, the
+advocates of expansion have plied this argument with vigor and with
+uniform success.
+
+The American nation began its work of territorial expansion with the
+purchase of Louisiana. Jefferson, who had been elected on a platform of
+strict construction of the Constitution, hesitated at an act which he
+regarded as "beyond the Constitution." (Jefferson's "Works," Vol. IV, p.
+198.) Quite different was the language of his more imperialistic
+contemporaries. Gouverneur Morris said, "France will not sell this
+territory. If we want it, we must adopt the Spartan policy and obtain it
+by steel, not by gold."[51] During February, 1803, the United States
+Senate debated the closing of the Mississippi to American commerce. "To
+the free navigation of the Mississippi we had an undoubted right from
+nature and from the position of the Western country,"[52] said Senator
+Ross (Pennsylvania) on February 14. On February 23rd Senator White
+(Delaware) went a step farther: "You had as well pretend to dam up the
+mouth of the Mississippi, and say to the restless waves, 'Ye shall cease
+here, and never mingle with the ocean,' as to expect they (the settlers)
+will be prevented from descending it."[53] On the same day (February
+23rd) Senator Jackson (Georgia) said: "God and nature have destined New
+Orleans and the Floridas to belong to this great and rising Empire."[54]
+
+God, nature and the requirements of American commerce were the arguments
+used to justify the purchase, or if necessary, the seizure of New
+Orleans. The precedent has been followed and the same arguments
+presented all through the century that followed the momentous decision
+to extend the territory of the United States.
+
+Some reference has been made to the Mexican War and the argument that
+the Southwest was a "natural" part of the territory of the United
+States. The same argument was made in regard to Cuba and by the same
+spokesmen of the slave-power. Stephen A. Douglas (New Orleans, December
+13, 1858) was asked:
+
+"How about Cuba?"
+
+"It is our destiny to have Cuba," he answered, "and you can't prevent it
+if you try."[55]
+
+On another occasion (New York, December, 1858) Douglas stated the matter
+even more broadly:
+
+"This is a young, vigorous and growing nation and must obey the law of
+increase, must multiply and as fast as we multiply we must expand. You
+can't resist the law if you try. He is foolish who puts himself in the
+way of American destiny."[56]
+
+President McKinley stated that the Philippines, like Cuba and Porto
+Rico, "were intrusted to our hands by the Providence of God" (Boston,
+February 16, 1899), and one of his fellow imperialists--Senator
+Beveridge of Indiana--carried the argument one step farther (January 9,
+1900) when he said in the Senate (_Congressional Record_, January 9,
+1900, p. 704): "The Philippines are ours forever.... And just beyond the
+Philippines are China's illimitable markets. We will not retreat from
+either. We will not repudiate our duty to the archipelago. We will not
+abandon our opportunity in the Orient. We will not renounce our part in
+the mission of our race, trustee, under God, of the civilization of the
+world."
+
+Manifest destiny is now urged to justify further acts of aggression by
+the United States against her weaker neighbors. _The Chicago Tribune_,
+discussing the Panama Canal and its implications, says editorially (May
+5, 1916): "The Panama Canal has gone a long way towards making our shore
+continuous and the intervals must and will be filled up; not necessarily
+by conquest or even formal annexation, but by a decisive control in one
+form or another."
+
+Here the argument of manifest destiny is backed by the argument of
+"military necessity,"--the argument that led Great Britain to possess
+herself of Gibraltar, Suez and a score of other strategic points all
+round the earth, and to maintain, at a ruinous cost, a huge navy; the
+argument that led Napoleon across Europe in his march of bloody, fatal
+triumph; the argument that led Germany through Belgium in 1914--one of
+the weakest and yet one of the most seductive and compelling arguments
+that falls from the tongue of man. Because we have a western and an
+eastern front, we must have the Panama Canal. Because we have the Panama
+Canal, we must dominate Central America. The next step is equally plain;
+because we dominate Central America and the Panama Canal, there must be
+a land route straight through to the Canal. In the present state of
+Mexican unrest, that is impossible, and therefore we must dominate
+Mexico.
+
+The argument was stated with persuasive power by ex-Senator Albert J.
+Beveridge (_Collier's Weekly_, May 19, 1917). "Thus in halting fashion
+but nevertheless surely, the chain of power and influence is being
+forged about the Gulf. To neglect Mexico is to throw away not only one
+link but a large part of that chain without which the value and
+usefulness of the remainder are greatly diminished if indeed not
+rendered negligible." By a similar train of logic, the entire American
+continent, from Cape Horn to Bering Sea can and will be brought under
+the dominion of the United States.
+
+Some destiny must call, some imperative necessity must beckon, some
+divine authority must be invoked. The campaign for "100 percent
+Americanism," carefully thought out, generously financed and carried to
+every nook and corner of the United States aims to prove this necessity.
+The war waged by the Department of Justice and by other public officers
+against the "Reds" is intended to arouse in the American people a sense
+of the present danger of impending calamity. The divine sanction was
+expressed by President Wilson in his address to the Senate on July 10,
+1919. The President discussed the Peace Treaty in some of its aspects
+and then said, "It is thus that a new responsibility has come to this
+great nation that we honor and that we would all wish to lift to yet
+higher service and achievement. The stage is set, the destiny disclosed.
+It has come about by no plan of our conceiving but by the hand of God
+who has led us into this war. We cannot turn back. We can only go
+forward, with lifted and freshened spirit to follow the vision."
+
+
+8. _The Open Road_
+
+The American people took a long step forward on November 2, 1920. The
+era of modern imperialism, begun in 1896 by the election of McKinley,
+found its expression in the annexation of Hawaii; the conquest of Cuba
+and the Philippines; the seizure of Panama, and a rapid commercial and
+financial expansion into Latin America. In 1912 the Republicans were
+divided. The more conservative elements backed Taft for reelection. The
+more aggressive group (notably United States Steel) supported
+Roosevelt. Between them they divided the Republican strength, and while
+they polled a total vote of 7,604,463 as compared with Wilson's
+6,293,910, the Republican split enabled Wilson to secure a plurality of
+2,173,512, although he had less than half of the total vote.
+
+President Wilson entered office with the ideals of "The New Freedom." He
+was out to back the "man on the make," the small tradesman and
+manufacturer; the small farmer; the worker, ambitious to rise into the
+ranks of business or professional life. With the support, primarily, of
+little business, Wilson managed to hold his own for four years, and at
+the 1916 election to poll a plurality, over the Republican Party, of
+more than half a million votes. He won, however, primarily because "he
+kept us out of war." April, 1917, deprived him of that argument. His
+"New Freedom" doctrines, translated into international politics (in the
+Fourteen Points) were roughly handled in Paris. The country rejected his
+leadership in the decisive Congressional elections of 1918, and he and
+his party went out of power in the avalanche of 1920, when Harding
+received a plurality nearly three times as great as the highest one ever
+before given a presidential candidate (Roosevelt, in 1904). Every state
+north of the Mason and Dixon Line went Republican. Tennessee left the
+Solid South and joined the same party. The Democrats carried only eleven
+states--the traditional Democratic stronghold.
+
+The victory of Harding is a victory for organized, imperial, American
+business. The "man on the make" is brushed aside. In his place stands
+banker, manufacturer and trader, ready to carry American money and
+American products into Latin America and Asia.
+
+Before the United States lies the open road of imperialism. Manifest
+destiny points the way in gestures that cannot be mistaken. Capitalist
+society in the United States has evolved to a place where it must make
+certain pressing demands upon neighboring communities. Surplus is to be
+invested; investments are to be protected, American authority is to be
+respected. All of these necessities imply the exercise of imperial power
+by the government of the United States.
+
+Capitalism makes these demands upon the rulers of capitalist society.
+There is no gainsaying them. A refusal to comply with them means death.
+
+Therefore the American nation, under the urge of economic necessity;
+guided half-intelligently, half-instinctively by the plutocracy, is
+moving along the imperial highroad, and woe to the man that steps across
+the path that leads to their fulfillment. He who seeks to thwart
+imperial destiny will be branded as traitor to his country and as
+blasphemer against God.
+
+FOOTNOTES:
+
+[48] "New American History," A. B. Hart. American Book Co., 1917, p.
+348.
+
+[49] The total area of these countries, exclusive of their colonies, is
+807,123 square miles.
+
+[50] See "Theory of the Leisure Class," Thorstein Veblen. New York,
+Huebsch, 1918, Ch. 10.
+
+[51] "A History of Missouri," Louis Houck. Chicago, R. R. Donnelly &
+Sons, 1908, vol. II, p. 346.
+
+[52] "History of Louisiana," Charles Gayarre. New Orleans, Hansell &
+Bros., Ltd., 1903, vol. III, p. 478.
+
+[53] Ibid., p. 485.
+
+[54] Ibid., p. 486.
+
+[55] McMaster's "History of the American People." Vol. VIII, p. 339.
+
+[56] Ibid., p. 339.
+
+
+
+
+XIII. THE UNITED STATES AS A WORLD COMPETITOR
+
+
+1. _A New World Power_
+
+Youngest among the great nations, the United States holds a position of
+immense world power. Measured in years and compared with her sister
+nations in Europe and Asia, she is a babe. Measured in economic strength
+she is a burly giant. Young America is, but mighty with a vast economic
+strength.
+
+An inexorable destiny seems to be forcing the United States into a
+position of international importance. Up to the time of the Spanish War,
+she played only a minor part in the affairs of the world. The Spanish
+War was the turning point--the United States as a borrowing nation gave
+way then, to the United States as an investing nation. Economic forces
+compelled the masters of economic life to look outside of the country
+for some of their business opportunities.
+
+Since the Civil War the United States has been preparing herself for her
+part in world affairs. During the thirty years that elapsed between 1870
+and 1900 she emerged from a position of comparative economic inferiority
+to take a position of notable economic importance. Between the years
+1870 and 1900 the population of the United States increased 97 per cent.
+During the same period the annual production of wheat increased from 236
+million bushels to 522 million bushels; the annual production of corn
+from 1,094 to 2,105 million bushels; the annual production of cotton
+from 4,352 to 10,102 thousand bales; the annual production of coal from
+29 to 241 million tons; the annual production of petroleum from 221 to
+2,672 million gallons; the annual production of pig iron from 1,665 to
+13,789 thousand tons; the annual production of steel from 68 to 10,188
+thousand tons; the annual production of copper from 12 to 271 thousand
+tons, and the production of cement (there is no record for 1870) rose
+from two million barrels in 1880 to 17 million barrels in 1900. Thus
+while the production of food more than kept pace with the increase of
+population, the production of those commodities upon which the new
+industry depends--coal, petroleum, iron, steel, copper and
+cement--increased many times more rapidly than the population. During
+one brief generation the United States, with almost unbelievable
+rapidity, forged ahead in the essentials for supremacy in the new world
+of industry.
+
+By the time of the Spanish War (1898) American industries had found
+their stride. During the next fourteen years they were overtaking their
+European competitors in seven league boots. Between 1900 and 1914 while
+the population of the United States increased by 30 per cent,--
+
+
+     Wheat production increased       70 per cent
+     Corn production increased        27  "   "
+     Cotton production increased      58  "   "
+     Coal production increased        90  "   "
+     Petroleum production increased  317  "   "
+     Pig Iron production increased    69  "   "
+     Steel production increased      131  "   "
+     Copper production increased      89  "   "
+     Cement production increased     406  "   "
+
+
+The United States was rushing toward a position of economic world power
+before the catastrophe of 1914 hurled her to the front, first as a
+producer (at immense profits) for the Allies, and later as the financier
+of the final stages of the War.
+
+The economic position that is now held by the United States among the
+great competing nations of the world can be in some measure
+suggested--it cannot be adequately stated--by a comparison of the
+economic position of the United States and some of the other leading
+world empires.
+
+Neither the geographical area of the United States nor the numerical
+importance of its people justifies its present world position. The
+country, with 8 per cent of the area and 6 per cent of the population of
+the world, looms large in the world's economic affairs,--how large will
+appear from an examination of certain features that are considered
+essential to economic success, such as resources, capital, products,
+shipping, and national wealth and income.
+
+
+2. _The Resources of the United States_
+
+The most important resource of any country is the fertile, agricultural
+land. Figures given in the Department of Agriculture Year Book for 1918
+(Table 319) show the amount of productive land,--including, beside
+cultivated land, natural meadows, pastures, forests, woodlots, etc., of
+the various countries according to pre-war boundary lines. The total of
+such productive land for the 36 leading countries of the world was
+4,591.7 million acres. Russia, including Siberia, had almost a third of
+this total (1,414.7 million acres). The United States came second with
+878.8 million acres, or 19 per cent of the total available productive
+land. Third in the list was Argentine with 537.8 million acres. British
+India came fourth with 465.7 million acres. Then there followed in order
+Austria-Hungary, Germany, France, Australia, Spain and Japan.
+Austria-Hungary, Germany and France combined had almost exactly four
+hundred million acres of productive land or less than half the
+productive area of the United States.
+
+The United States, in the area of productive land, is second only to
+Russia. In the area of land actually under cultivation, however, it
+stands first, with Russia a close second and British India a close
+third,--the amounts of cultivated land in each of these countries being
+293.8 million acres, 279.6 million acres, and 264.9 million acres
+respectively. These three countries together contain 64 per cent of the
+1,313.8 million acres of cultivated land of the world. The United States
+alone contains 22 per cent of the total cultivated land.
+
+The total forest acreage available for commercial purposes is greatest
+in Russia (728.4 million acres). The United States stands second with
+400 million acres and Canada third with 341 million acres. The Chief of
+Forest Investigations of the United States Department of Agriculture
+(Letter of Oct. 11, 1919) places the total forest acreage of both Brazil
+and Canada ahead of the United States. In the case of Brazil no figures
+are available showing what portion of the 988 million acres of total
+area is commercially available. Canada with a total forest acreage of
+800 million acres has less timber commercially available than the United
+States with a total forest area of 500 million acres.
+
+The iron ore reserves of the world are estimated at 91,000 million tons
+("Iron Ores," Edwin C. Eckel. McGraw Hill Book Co., 1914, pp. 392-3). Of
+this amount 51,000 millions are placed in Asia and Africa; 12,000
+million tons in Europe, and 14,800 million tons in North America. The
+United States alone is credited with 4,260 million tons or about 5 per
+cent of the world's supply. The United States Geological Survey
+(_Bulletin_ 666v) estimates the supply of the United States at 7,550
+million tons; the supply in Newfoundland, Mexico and Cuba as 7,000
+million tons, and that in South America as 8,000 million tons as against
+12,000 million tons for Europe. This estimate would give the United
+States alone 8 per cent of the iron ore of the world. It would give
+North America 15 per cent and the Western Hemisphere 25 per cent, as
+against 15 per cent for Europe.
+
+Iron ore furnishes the material out of which industrial civilization is
+constructed. Until recently the source of industrial power has been
+coal. Even to-day petroleum and water play a relatively unimportant
+role. Coal still holds the field.
+
+The United States alone contains 3,838,657 million tons--more than half
+of the total coal reserves of the world. ("Coal Resources of the World."
+Compiled by the Executive Committee, International Geological Congress,
+1913, Vol. I, p. XVIII ff.) North America is credited with 5,073,431
+million tons or over two-thirds of the world's total coal reserves
+(7,397,553 millions of tons). The coal reserve of Europe is 784,190
+million tons or about one-fifth of the coal reserves of the United
+States alone.
+
+Figures showing the amount of productive land and of timber may be
+verified. Those dealing with iron ore and coal in the ground are mere
+estimates and should be treated as such. At the same time they give a
+rough idea of the economic situation. Of all the essential
+resources,--land, timber, iron, copper, coal, petroleum and
+water-power,--the United States has large supplies. As compared with
+Europe, her supply of most of them is enormous. No other single country
+(the British Empire is not a single country) that is now competing for
+the supremacy of the world can compare with the United States in this
+regard, and if North America be taken as the unit of discussion, its
+preponderance is enormous.
+
+
+3. _The Capital of the United States_
+
+The United States apparently enjoys a large superiority over any single
+country in its reserves of some of the most essential resources. The
+same thing is true of productive machinery.
+
+Figures showing the actual quantities of capital are available in only a
+small number of cases. Estimates of capital value in terms of money are
+useless. It is only the figures which show numbers of machines that
+really give a basis for judging actual differences.
+
+Live stock on farms, the chief form of agricultural capital, is reported
+for the various countries in the Year Book of the United States
+Department of Agriculture. The United States (1916) heads the list with
+61.9 million cattle; 67.8 million hogs; 48.6 million sheep and goats,
+and 25.8 million horses and mules,--204 million farm animals in all. The
+Russian Empire (including Russia in Asia) is second (1914) with 52.0
+million cattle; 15.0 hogs; 72.0 million sheep and goats, and 34.9
+horses and mules,--174 million farm animals in all. British India (1914)
+reports more cattle than any other country (140.5 million); she is also
+second in the number of sheep and goats with 64.7 millions, but she has
+no hogs and 1.9 million horses. Argentina (1914) reports 29.5 million
+cattle; 2.9 million sheep and goats; and 8.9 million horses and mules.
+The number of animals on European farms outside of Russia is
+comparatively small. Germany (1914), United Kingdom (1916),
+Austria-Hungary (1913), and France (1916) reported 61.8 million cattle,
+46.6 million hogs, 60.8 million sheep and goats, and 11.5 million horses
+and mules, making a total of 180.7 million farm animals. These four
+countries with a population of about 206 million persons, had less live
+stock than the United States with its population (1916) of about 100
+millions.
+
+It would be interesting to compare the amount of farm machinery and farm
+equipment of the United States with that of other countries.
+Unfortunately no such figures are available.
+
+The figures showing transportation capital are fairly complete.
+(_Statistical Abstr._ 1918, pp. 844-5.) The total railroad mileage of
+the world is 729,845. More than one-third of this mileage (266,381
+miles) is in the United States. Russia (1916) comes second with 48,950
+miles; Germany (1914) third, with 38,600 miles and Canada (1916) fourth
+with 37,437 miles.
+
+The world's total mileage of telegraph wire (Ibid.) is 5,816,219, of
+which the United States has more than a fourth (1,627,342 miles). Russia
+(1916) is second with 537,208 miles; Germany (1914) is third with
+475,551 miles; and France fourth with 452,192 miles.
+
+The Bureau of Railway Economics has published a compilation on
+"Comparative Railway Statistics" (_Bulletin 100_, Washington, 1916) from
+which it appears that the United States is far ahead of any other
+country in its railroad equipment. The total number of locomotives in
+the United States was 64,760; in Germany 29,520; in United Kingdom
+24,718; in Russia (1910) 19,984; and in France 13,828. No other country
+in the world had as many as ten thousand locomotives. If these figures
+also showed the locomotive tonnage as well as the number, the lead of
+the United States would be even more decided as the European locomotives
+are generally smaller than those used in the United States. This fact is
+clearly brought out by the figures from the same bulletin showing
+freight car tonnage (total carrying capacity of all cars). For the
+United States the tonnage was (1913) 86,978,145. The tonnage of Germany
+was 10.7 millions; of France 5.0 millions; of Austria-Hungary 3.8
+millions. The figures for the United Kingdom were not available.
+
+The United States also takes the lead in postal equipment. (_Stat.
+Abstr._, 1918, pp. 844-5.) There are 324,869 post offices in the world;
+54,257 or one-sixth in the United States. The postal routes of the world
+cover 2,513,997 miles, of which 450,954 miles are in the United States.
+The total miles of mail service for the world is 2,061 millions. Of this
+number the United States has 601.3 millions.
+
+The most extreme contrast between transportation capital in the United
+States and foreign countries is furnished by the number of automobiles.
+_Facts and Figures_, the official organ of the National Automobile
+Chamber of Commerce (April, 1919) estimates the total number of cars in
+use on January 1, 1917 as 4,219,246. Of this number almost six-sevenths
+(3,500,000) were in use in the United States. The total number of cars
+in Europe as estimated by the Fiat Press Bureau, Italy, was 437,558, or
+less than one-seventh of the number in use in the United States.
+Automobile distribution is of peculiar significance because the industry
+has developed almost entirely since the Spanish-American War and
+therefore since the time when the United States first began to develop
+into a world power.
+
+The world's cotton spindleage in 1919 is estimated at 149.4 million
+spindles. (Letter from T. H. Price 10/6/19.) Of this total Great Britain
+has 57.0 millions; the United States 33.7 millions; Germany 11.0
+millions; Russia 8.0 millions, and France and India each 7.0 millions.
+
+No effort has been made to cite figures showing the estimated value of
+various forms of capital, because of the necessary variations in value
+standards. Enough material showing actual quantities of capital has been
+presented to prove that in agriculture, in transportation, in certain
+lines of manufacturing the United States is either at the head of the
+list, or else stands in second place. In transportation capital
+(particularly automobiles) the lead of the United States is very great.
+
+If figures were available to show the relative amounts of capital used
+in mining, in merchandising, and in financial transactions they would
+probably show an equally great advantage in favor of the United States.
+In this connection it might not be irrelevant to note that in 1915 the
+total stock of gold money in the world was 8,258 millions of dollars.
+More than a quarter (2,299 millions) was in the United States. The total
+stock of silver money was 2,441 millions of dollars of which 756
+millions (nearly a third) was in the United States. (_Stat. Abstr._,
+1918, pp. 840-1.)
+
+
+4. _Products of the United States_
+
+Figures showing the amounts of the principal commodities produced in the
+United States are far more complete than those covering the resources
+and capital. They are perhaps the best index of the present economic
+position of the United States in relation to the other countries of the
+world.
+
+The wheat crop of the world in 1916 was 3,701.3 million bushels. Russia,
+including Siberia, was the leading producer with 686.3 million bushels.
+The United States was second with 636.7 million bushels or 17 per cent
+of the world's output. British India, the third wheat producer, had a
+crop in 1916 of 323.0 million bushels. Canada, with 262.8 million
+bushels, was fourth on the list. Thus Canada and the United States
+combined produced almost exactly one-fourth of the world's wheat crop.
+
+As a producer of corn the United States is without a peer. The world's
+corn crop in 1916 was 3,642.1 million bushels. Two-thirds of this crop
+(2,566.9 million bushels) was produced in the United States.
+
+The position of the United States as a producer of corn is almost
+duplicated in the case of cotton. The _Statistical Abstract_ published
+by the British Government (No. 39, London, 1914, p. 522) gives the
+world's cotton production as 21,659,000 bales (1912). Of this number the
+United States produced 14,313,000--almost exactly two-thirds. British
+India, which ranks second, reported a production of 3,203,000 bales.
+Egypt was third with 1,471,000 bales.
+
+About one-tenth of the world's output of wool is produced in the United
+States. World production for 1917 is placed at 2,790,000 pounds.
+(_Bulletin_, National Association of Wool Manufacturers. 1918, p. 162.)
+Australia heads the list with a production of 741.8 million pounds.
+Russia, including Siberia, comes second with 380.0 million pounds. The
+United States is third with 285.6 million pounds and Argentina fourth
+with 258.3 million pounds.
+
+The United States leads the world in timber production. "Last winter we
+estimated that the United States has been cutting about 50 per cent of
+the total world's supply of lumber." (Letter from Chief of Forest
+Investigation. U. S. Forest Service. Oct. 11, 1919.) The same letter
+gives the present annual timber cut. The United States 12.5 billion
+cubic feet; Russia 7.1 billion cubic feet; Canada 3.0 billion cubic
+feet; Austria-Hungary 2.7 billion cubic feet.
+
+A third of the iron ore produced in the world in 1912 came from the
+United States. The world's production in that year was 154.0 million
+tons (_British Statistical Abstract_, No. 39, p. 492). The United States
+produced 56.1 million tons or 36 per cent of the whole; Germany produced
+32.7 million tons; France 19.2 million tons; the United Kingdom 14.0
+million tons. No other country is reported as producing as much as ten
+million tons.
+
+The position of the United States as a producer of iron and steel was
+greatly enhanced by the war. _The Daily Consular and Trade Reports_
+(July 9, 1919, p. 155) give a comparison between the world's steel and
+iron output in 1914 and 1918. In 1914 the United States produced 23.3
+million tons of pig iron; Germany produced 14.4 million tons; the United
+Kingdom 8.9 million tons, and France 5.2 million tons. The United States
+was thus producing 45 per cent of the pig iron turned out in these four
+countries. For 1918 the pig iron production of the United States was
+39.1 million tons. That of the other three countries was 22.0 million
+tons. In that year the United States produced 64 per cent of the pig
+iron product of these four countries. An equally great lead is shown in
+the case of steel production. In 1914 the United States produced 23.5
+million tons of steel. Germany, the United Kingdom and France produced
+27.6 million tons. By 1918 the production of the United States had
+nearly doubled (45.1 million tons).
+
+The total pig iron output of the world for 1917 was placed at 66.9
+millions of tons. The world's production of steel in 1916 was placed at
+83 million tons. The United States produced considerably more than half
+of both commodities. ("The Mineral Industry During 1918." New York,
+McGraw Hill Book Co., 1919, pp. 379-80).
+
+The two chief forms of power upon which modern industry depends are
+petroleum and coal. The United States is the largest producer of both of
+these commodities. The world's production of petroleum in 1917 was 506.7
+million barrels (_Mineral Resources_, 1917, Part II, p. 867). Of this
+amount the United States produced 335.3 million barrels or 66 per cent
+of the total. The second largest producer, Russia, and the third,
+Mexico, are credited with 69 million barrels and 55.3 million barrels
+respectively.
+
+As a coal producer the United States stands far ahead of all other
+nations. The United States Geological Survey (_Special Report_, No. 118)
+placed the total coal production of the world in 1913 at 1,478 million
+tons. Of this amount 569.9 million tons (38.5 per cent) were produced in
+the United States. The production for Great Britain was 321.7 million
+tons; for Germany 305.7 million tons; for Austria-Hungary 60.6 million
+tons. No other country reported a production of as much as fifty million
+tons. In 1915 the United States produced 40.5 per cent of the world's
+coal; in 1917 44.2 per cent; in 1918 46.2 per cent.
+
+Copper has become one of the world's chief metals. Two-thirds of all the
+copper is produced in the United States. Copper production in 1916
+totaled 3,107 million pounds (_Mineral Resources in the United States_,
+1916, part I, p. 625). The production for the United States was 1,927.9
+million pounds (62 per cent of the whole). The second largest producer,
+Japan, turned out 179.2 million pounds.
+
+The precious metals, gold and silver, are largely produced in the United
+States. The world's gold production for 1917 was 423.6 million dollars
+(_Mineral Resources_, 1917, p. 613). Africa produced half of this amount
+(214.6 million dollars). The United States was second with a production
+of 83.8 million dollars (20 per cent of the whole). The same publication
+(p. 615) gives the world's silver production in 1917 as 164 million
+ounces. 77.1 million ounces (43 per cent) were produced in the United
+States. The second largest producer was Mexico, 31.2 million ounces; and
+the third Canada, with 22.3 million ounces. These three North American
+countries produced 76 per cent of the world's output of silver.
+
+Judge Gary, speaking at the Annual Meeting of the Iron and Steel
+Institute (1920) put the situation in this summary form:--
+
+As frequently stated, notwithstanding the United States has only 6% of
+the world's population and 7% of the world's land, yet we produce:
+
+
+     20% of the world's supply of gold,
+     25% of the world's supply of wheat,
+     40% of the world's supply of iron and steel,
+     40% of the world's supply of lead,
+     40% of the world's supply of silver,
+     50% of the world's supply of zinc,
+     52% of the world's supply of coal,
+     60% of the world's supply of aluminum,
+     60% of the world's supply of copper,
+     60% of the world's supply of cotton,
+     66% of the world's supply of oil,
+     75% of the world's supply of corn,
+     85% of the world's supply of automobiles.
+
+
+With the exception of rubber, practically all of the essential raw
+materials and food products upon which modern industrial society depends
+are produced largely in the United States. With less than a sixteenth of
+the world's population, the United States produced from a fifth to
+two-thirds of most of the world's essential products.
+
+
+5. _Shipping_
+
+The rapid increase in the foreign trade of the United States created a
+demand for American shipping facilities. Before the Civil War the United
+States held a place as a maritime nation. Between the Civil War and the
+war with Spain the energies of the American people were devoted to
+internal improvement. With the advent of expansion that followed the
+Spanish-American War, came an insistent demand that the United States
+develop a merchant marine adequate to carry its own foreign trade.
+
+The United States Commissioner of Navigation in his report for 1917 (p.
+78) gives the net gross tonnage of steam and sailing vessels in 1914 as
+45 million tons in all. The tonnage of Great Britain was 19.8 million
+tons; of Germany 4.9 million tons; of the United States 3.5 million
+tons; of Norway 2.4 million tons; of France 2.2 million tons; of Japan
+1.7 million tons, and of Italy 1.6 million tons.
+
+The war brought about great changes in the distribution of the world's
+shipping. Germany was practically eliminated as a shipping nation. The
+necessity of recouping the submarine losses, and of transporting troops
+and supplies led the United States to adopt a ship-building program
+that made her the second maritime country of the world. Lloyd's Register
+of Shipping gives the steam tonnage of the United Kingdom as 18,111,000
+gross tons in June, 1920. For the same month the tonnage of the United
+States is given as 12,406,000 gross tons. Japan comes next with a
+tonnage of 2,996,000 gross tons. According to the same authority the
+United Kingdom had 41.6 per cent of the world's tonnage in 1914 and 33.6
+per cent in 1920; while the United States had 4.7 per cent of the
+world's tonnage in 1914 and 24 per cent in 1920.
+
+
+6. _Wealth and Income_
+
+The economic advantages of the United States enumerated in this chapter
+inevitably are reflected in the figures of national wealth and national
+income. While these figures are estimates rather than conclusive
+statements they are, nevertheless, indicative of a general situation.
+
+During the war a number of attempts were made to approximate the pre-war
+wealth and income of the leading nations. Perhaps the most ambitious of
+these efforts was contained in a paper on "Wealth and Income of the
+Chief Powers" read before the Royal Statistical Society. (See _The
+London Economist_, May 24, 1919, pp. 958-9.) This and other estimates
+were compiled by L. R. Gottlieb and printed in the _Quarterly Journal of
+Economics_ for Nov. 1919. Mr. Gottlieb estimates the pre-war national
+wealth of Great Britain, France, Italy, Japan, Russia, Belgium, Germany,
+Austria-Hungary, Turkey and Bulgaria at 366,100 million dollars. At the
+same time the wealth of the United States was estimated at 204,400
+million dollars. Thus the wealth of the United States was equal to about
+36 per cent of the total wealth of the great nations in question.
+
+The same article contains an estimate of pre-war national incomes for
+these great powers. The total is placed at 81,100 million dollars. The
+income for the United States is placed at 35,300 million dollars, or
+more than 43 per cent of the total.
+
+The war has made important changes in the wealth and income of the
+principal powers. The wealth and income of Europe have been reduced,
+while the wealth and income of the United States have been greatly
+increased. This increase is rendered doubly emphatic by the
+demoralization in foreign exchange which gives the American dollar a
+position of unique authority in the financial world.
+
+The latest wealth estimates (_Commerce and Finance_, May 26, and July
+28, 1920) in terms of dollars at their purchasing-power value, makes the
+wealth of the whole British Empire 230 billions of dollars; of France,
+100 billions; of Russia, 60 billions; of Italy, 40 billions; of Japan,
+40 billions; of Germany, 20 billions, and of the United States, 500
+billions. These figures are subject to alteration with the alteration of
+the exchange rates, but they indicate the immense advantage that is
+possessed by the business men of the United States over the business men
+of any or of all of the other nations of the world.
+
+Before the war, the British were the chief lenders in the international
+field. In 1913 Great Britain had about 20 billions of dollars of foreign
+investments, as compared with 9 billions for France and about 6 billions
+for Germany. At the end of 1920, the British foreign investments had
+shrunk to a fraction of their former amount, while the United States,
+from the position of a debtor nation, had become the leading investing
+nation of the world, with over 9 billions of dollars loaned to the
+Allied governments; with notice loans estimated at over 10 billions;
+with foreign investments of 8 billions, and goods on consignment to the
+extent of 2 billions.
+
+The United States therefore began the year 1921 with a greater financial
+lead, by several times over, than that which she held before the war,
+when she was credited with a greater wealth and a larger income than
+that of any other nation in the world. The extent of the advantage
+enjoyed by the United States at the end of 1920 cannot be stated with
+any final accuracy, but its proportions are staggering.
+
+
+7. _The Economic Position of the United States_
+
+Economically the United States is a world power. She occupies one of the
+three great geographical areas in the temperate zone. If she were to
+include Canada, Mexico and Central America--the territory north of the
+Canal Zone--she would have the greatest unified body of economic
+advantage anywhere in the world.
+
+The United States is rich in practically all of the important industrial
+resources. She has a large, relatively homogeneous population, a great
+part of which is directly descended from the conquering races of the
+world. Almost all of the essential raw materials are produced in the
+United States, and in relatively large quantities. The period since the
+Spanish War has witnessed a rapid increase in wealth production. The war
+of 1914 resulted in an even greater increase in shipping. The investable
+surplus is greater in the United States than in any other nation, and in
+amount as well as in percent the national debt is less than that in any
+other important nation except Japan. Economically the position of the
+United States is unique. The masters of her industries hold a position
+of great advantage in the capitalist world.
+
+
+
+
+XIV. THE PARTITION OF THE EARTH
+
+
+1. _Economic Power and Political Authority_
+
+Economically the United States is a world power. Her world position in
+politics follows as a matter of course.
+
+While the American people were busy with internal development, they
+played an unimportant part in world affairs. They were not competing for
+world trade, because they had relatively little to export; they were not
+building a merchant marine because of the smallness of their trading
+activities; they were not engaged in the scramble after undeveloped
+countries because, with an undeveloped country of their own, calling
+continually for enlarged investments, they had little surplus capital to
+employ in foreign enterprises.
+
+This economic isolation of the United States was reflected in an equally
+thoroughgoing political isolation. With the exception of the Monroe
+Doctrine, which in its original form was intended as a measure of
+defense against foreign political and military aggression, the United
+States minded its own affairs, and allowed the remainder of the world to
+go its way. From time to time, as necessity arose, additional territory
+was purchased or taken from neighboring countries--but all of these
+transactions, up to the annexation of Hawaii (1898) were confined to the
+continent of North America, in which no European nation, with the
+exception of Great Britain, had any imperative territorial interest.
+
+The economic changes which immediately preceded the Spanish War period
+commanded for the United States a place among the nations. The passing
+of economic aloofness marked the passing of political aloofness, and
+the United States entered upon a new era of international relationships.
+Possessed of abundant natural resources, and having through a long
+period of peace developed a large working capital with which these
+resources might be exploited, the United States, at the beginning of the
+twentieth century, was in a position to export, to trade and to invest
+in foreign enterprises.
+
+The advent of the World War gave the United States a dramatic
+opportunity to take a position which she must have assumed in any case
+in a comparatively short time. It had, however, one signal, diplomatic
+advantage,--it enabled the capitalist governments of Europe to accept,
+with an excellent grace, the newly acquired economic prominence of the
+United States and to recognize her without question as one of the
+leading political powers. The loan of ten billions to Europe; the
+sending of two million men at double quick time to the battle front; the
+immense increases in the production of raw material that followed the
+declaration of war by the United States; the thoroughness displayed by
+the American people, once they had decided to enter the war, all played
+their part in the winning of the victory. There were feelings, very
+strongly expressed, that the United States should have come in sooner;
+should have sacrificed more and profiteered less. But once in, there
+could be no question either of the spirit of her armies or of the vast
+economic power behind them.
+
+When it came to dividing the spoils of victory, the United States held,
+not only the purse strings, but the largest surpluses of food and raw
+materials as well. Her diplomacy at the Peace Table was weak. Her
+representatives, inexperienced in such matters, were no match for the
+trained diplomats of Europe, but her economic position was unquestioned,
+as was her right to take her place as one of the "big five."
+
+
+2. _Dividing the Spoils_
+
+The Peace Conference, for purposes of treaty making, separated the
+nations of the world into five classes:
+
+
+     1. The great capitalist nations.
+     2. The lesser capitalist states.
+     3. Enemy nations.
+     4. Undeveloped territories.
+     5. The socialist states.
+
+
+The great capitalist states were five in number--Great Britain, France,
+Italy, Japan and the United States. These five states dominated the
+armistice commission and the Peace Conference and they were expected to
+dominate the League of Nations. The position of these five powers was
+clearly set forth in the regulations governing procedure at the Peace
+Conference. Rule I reads: "The belligerent powers with general
+interests--the United States of America, the British Empire, France,
+Italy and Japan--shall take part in all meetings and commissions." (_New
+York Times_, January 20, 1919.) Under this rule the Big Five were the
+Peace Conference, and throughout the subsequent negotiations they
+continued to act the part.
+
+The same concentration of authority was read into the revised covenant
+of the League of Nations. Article 4 provides that the Executive Council
+of the League "shall consist of the representatives of the United States
+of America, of the British Empire, of France, of Italy and of Japan,
+together with four other members of the League." The authority of the
+Big Five was to be maintained by giving them five votes out of nine on
+the executive council of the League, no matter how many other nations
+might become members.
+
+It was among the Big Five, furthermore, that the spoils of victory were
+divided. The Big Five enjoyed a full meal; the lesser capitalist states
+had the crumbs.
+
+The enemy nations were stripped bare. Their colonies were taken, their
+foreign investments were confiscated, their merchant ships were
+appropriated, they were loaded down with enormous indemnities, they were
+dismembered. In short, they were rendered incapable of future economic
+competition. The thoroughgoing way in which this stripping was
+accomplished is discussed in detail by J. M. Keynes in "The Economic
+Consequences of the Peace" (chapters 4 and 5).
+
+The undeveloped territories--the economic opportunities upon which the
+Big Five were relying for the disposal of their surplus products and
+surplus capital, were carved and handed about as a butcher carves a
+carcass. Shantung, which Germany had taken from China, was turned over
+to Japan under circumstances which made it impossible for China to sign
+the Treaty--thus leaving her territory open for further aggression. The
+Near East was divided between Great Britain, France and Italy. Mexico
+was not invited to sign the treaty and her name was omitted from the
+list of those eligible to join the League. The German possessions in
+Africa and in the Pacific were distributed in the form of "mandates" to
+the Great Powers. The principle underlying this distribution was that
+all of the unexploited territory should go to the capitalist victors for
+exploitation. The proportions of the division had been established,
+previously, in a series of secret treaties that had been entered into
+during the earlier years of the war.
+
+With the Big Five in control, with the lesser capitalist states
+silenced; with the border states made or in the making; with the enemy
+reduced to economic impotence, and the unexploited portions of the world
+assigned for exploitation, the conference was compelled to face still
+another problem--the Socialist Republic of Russia.
+
+Russia, Czar ridden and oppressed, had entered the war as an ally of
+France and Great Britain. Russia, unshackled and attempting
+self-government on an economic basis, was an "enemy of civilization."
+The Allies therefore supported counter-revolution, organized and
+encouraged warfare by the border states, established and maintained a
+blockade, the purpose of which was the starvation of the Russian people
+into submission, and did all that money, munitions, supplies,
+battleships and army divisions could do to destroy the results of the
+Russian Revolution.
+
+The Big Five--assuming to speak for all of the twenty-three nations that
+had declared war on Germany--manipulated the geography of Europe,
+reduced their enemies to penury, disposed of millions of square miles of
+territory and tens of millions of human beings as a gardener disposes of
+his produce, and then turned their united strength to the task of
+crushing the only thing approaching self-government that Russia has had
+for centuries.
+
+A more shameless exhibition of imperial lust is not recorded in history.
+Never before were five nations in a position to sit down at one table
+and decide the political fate of the world. The opportunity was unique,
+and yet the statesmen of the world played the old, savage game of
+imperial aggression and domination.
+
+This brutal policy of dealing with the world and its people was accepted
+by the United States. Throughout the Conference her representatives
+occupied a commanding position; at any time they would have been able to
+speak with a voice of almost conclusive authority; they chose,
+nevertheless, to play their part in this imperial spectacle. To be sure
+the Senate refused to ratify the Treaty,--not because of its imperial
+iniquities, but rather because there was nothing in it for the United
+States.
+
+
+3. _Italy, France and Japan_
+
+The shares of spoil falling to Italy and France as a result of the
+treaty are comparatively small although both countries--and particularly
+France--carried a terrific war burden. Japan, the least active of any of
+the leading participants in the war, received territory of vast
+importance to her future development.
+
+Italy,--under the secret treaty of London, signed April 26, 1915, by
+the representatives of Russia, France, Great Britain and Italy,--was to
+receive that part of Austria known as the Trentine, the entire southern
+Tyrol, the city and suburbs of Trieste, the Istrian Islands and the
+province of Dalmatia with various adjacent islands. Furthermore, Article
+IX of the Treaty stipulated that, in the division of Turkey, Italy
+should be entitled to an equal share in the basin of the Mediterranean,
+and specifically to the province of Adalia. Under Article XIII, "In the
+event of the expansion of French and English colonial domains in Africa
+at the expense of Germany, France and Great Britain recognize in
+principle the Italian right to demand for herself certain compensations
+in the sense of expansions of her lands in Erithria, Somaliland, in
+Lybia and colonial districts lying on the boundary, with the colonies of
+France and England." Substantially, this plan was followed in the Peace
+Treaty.
+
+The territorial claims of France were simple. The secret treaties
+include a note from the French Minister of Foreign Affairs to the French
+Ambassador at Petrograd, dated February 1-14, 1917, which stated that
+under the Peace Treaty:
+
+
+     "(1) Alsace and Lorraine to be returned to France.
+
+     "(2) The boundaries will be extended at least to the limits of the
+     former principality of Lorraine, and will be fixed under the
+     direction of the French Government. At the same time strategic
+     demands must be taken into consideration, so as to include within
+     the French territory the whole of the industrial iron basin of
+     Lorraine and the whole of the industrial coal-basin of the Saar."
+
+
+The Peace Treaty confirmed these provisions, with the exception of the
+Saar Valley, which is to go to France for 15 years under conditions
+which will ultimately cause its annexation to France if she desires it.
+France also gained some slight territorial concessions in Africa. Her
+real advantage--as a result of the peace--lies in the control of the
+three provinces with their valuable mineral deposits.
+
+The territorial ambitions of Japan were confined to the Far East. The
+former Russian Ambassador to Tokio, under date of February 8, 1917,
+makes the statement that Japan was desirous of securing "the succession
+to all the rights and privileges possessed by Germany in the Shantung
+province and for the acquisition of the islands north of the Equator."
+In a secret treaty with Great Britain, Japan secured a guarantee
+covering such a division of the German holdings in the Pacific.
+
+These concessions are of great importance to Japan. By the terms of the
+Treaty one of her rivals for the trade of the East (Germany) is
+eliminated, and the territory of that rival goes to Japan. With the
+control of Port Arthur and Korea and Shantung, Japan holds the gateway
+to the heart of Northern China. The islands gained by Japan as a result
+of the Treaty give her a barrier extending from the Kurile Islands, near
+Kamchatka, through the Empire of Japan proper, to Formosa. Farther out
+in the Pacific, there are the Ladrones, the Carolines and the Pelew
+Islands, which, in combination, make a series of submarine bases that
+render attack by sea difficult or impossible, and that lie,
+incidentally, between the United States and the Philippine Islands.
+Japan came away from the Peace Conference with the key to the East in
+her pocket.
+
+
+4. _The Lion's Share_
+
+The lion's share of the Peace Conference spoil went to Great Britain. To
+each of the other participants, certain concessions, agreed upon
+beforehand, were made. The remainder of the war-spoil was added to the
+British Empire. This "remainder" comprised at least a million and half
+square miles of territory, and included some of the most important
+resources in the world.
+
+The territorial gains of Great Britain cover four areas--the Near East,
+the Far East, Africa, and the South Pacific.
+
+The gains of Great Britain in the Near East include Hedjez and Yemen,
+the control of which gives the British possession of virtually all of
+the territory bordering on the Red Sea. The Persian Gulf is likewise
+placed under British control, through her holding of Mesopotamia and her
+control over Persia and Oman. The eastern end of the Mediterranean is
+held by the British through their control of Palestine.
+
+Thus the gateway to the East,--both by land and by sea, the eastern
+shores of the Mediterranean, the valleys of the Tigris and the Euphrates
+and the basin of the Red Sea all fall into the hands of the British, who
+now hold the heart of the Near East. The gains of Great Britain in
+Africa include Togoland, German Southwest Africa and German East Africa.
+With these accessions of territory, Great Britain holds a continuous
+stretch of country from the Cape to Cairo. A British subject can
+therefore travel on British soil from Cape Town via the Isthmus of Suez,
+to Siam, covering a distance as the crow flies of something like 10,000
+miles.
+
+The British gains in the South Pacific include Kaiser Wilhelm Land and
+the German islands south of the Equator.
+
+What these territorial gains mean in the way of additional resources for
+the industries of the home country, only the future can decide. Certain
+it is, that outside of the Americas, Central Europe, Russia, China and
+Japan, Great Britain succeeded in annexing most of the important
+territory of the world.
+
+The _Chicago Tribune_, in one of its charmingly frank editorials, thus
+describes the gains to the British Empire as a result of the war. "The
+British mopped up. They opened up their highway from Cairo to the Cape.
+They reached out from India and took the rich lands of the Euphrates.
+They won Mesopotamia and Syria in the war. They won Persia in diplomacy.
+They won the east coast of the Red Sea. They put protecting territory
+about Egypt and gave India bulwarks. They made the eastern dream of the
+Germans a British reality.
+
+"The British never had their trade routes so guarded as now. They never
+had their supremacy of the sea so firmly established. Their naval
+competitor, Germany, is gone. No navy threatens them. No empire
+approximates their size, power, and influence.
+
+"This is the golden age of the British Empire, its Augustan age. Any
+imperialistic nation would have fought any war at any time to obtain
+such results, and as imperialistic nations count costs, the British
+cost, in spite of its great sums in men and money was small." (January
+4, 1920.)
+
+
+5. _Half the World--Without a Struggle_
+
+Two significant facts stand out in this record of spoils distribution.
+One is that Great Britain received the lion's share of them in Asia and
+Africa. The other, that there is no mention of the Americas. Outside of
+the Western Hemisphere, Great Britain is mistress. In the Americas, with
+the exception of Canada, the United States is supreme.
+
+There are two reasons for this. One is that Germany's ambitions and
+possessions included Asia and Africa primarily--and not America. The
+other is that the Peace Conference recognized the right of the United
+States to dominate the Western Hemisphere.
+
+The representatives of the United States declared that their country was
+asking for nothing from the Peace Conference. Nevertheless, the
+insistent clamor from across the water led the American delegation to
+secure the insertion in the revised League Covenant of Article XXI which
+read: "Nothing in this covenant shall be deemed to affect the validity
+of international engagements, such as treaties of arbitration or
+regional understandings like the Monroe Doctrine for securing the
+maintenance of peace." This article coupled with the first portion of
+Article X, "The members of the League undertake to respect and preserve
+as against external aggression the territorial integrity and existing
+political independence of all members of the League," guarantees to the
+United States complete authority over Latin America, reserving to her
+political suzerainty and economic priority.
+
+The half of the earth reserved to the United States under these
+provisions contains some of the richest mineral deposits, some of the
+largest timber areas, and some of the best agricultural territory in the
+world. Thus at the opening of the new era, the United States, at the
+cost of a comparatively small outlay in men and money, has guaranteed to
+her by all of the leading capitalist powers practically an exclusive
+privilege for the exploitation of the Western Hemisphere.
+
+
+
+
+XV. PAN-AMERICANISM
+
+
+1. _America for the Americans_
+
+In the partition of the earth, one-half was left under the control of
+the United States. Among the great nations, parties to the war and the
+peace, the United States alone asked for nothing--save the acceptance by
+the world of the Monroe Doctrine. The doctrine, as generally understood,
+makes her mistress of the Western Hemisphere.
+
+The Monroe Doctrine originated in the efforts of Latin America to
+establish its independence of imperial Europe, and the counter efforts
+of imperial Europe to fasten its authority on the newly created Latin
+American Republics. President Monroe, aroused by the European crusade
+against popular government, wrote a message to Congress (1823) in which
+he stated the position of the United States as follows:
+
+"The American continents, by the free and independent condition which
+they have assumed and maintained, are henceforth not to be considered as
+subjects for future colonization by any European powers."
+
+Monroe continues by pointing out that the United States must view any
+act which aims to establish European authority in the Americas as
+"dangerous to our peace and safety."
+
+"The United States will keep her hands off Europe; she will expect
+Europe to keep her hands off America," was the essence of the doctrine,
+which has been popularly expressed in the phrase "America for the
+Americans." The Doctrine was thus a statement of international
+aloofness,--a declaration of American independence of the remainder of
+the world.
+
+The Monroe Doctrine soon lost its political character. The southern
+statesmen who were then guiding the destinies of the United States were
+looking with longing eyes into Texas, Mexico, Cuba and other potential
+slave-holding territory. Later, the economic necessities of the northern
+capitalists led them in the same direction. Professor Roland G. Usher,
+in his "Pan-Americanism" (New York, The Century Company, 1915, pp.
+391-392) insists that the Monroe Doctrine stands "First, for our
+incontrovertible right of self-defense. In the second place the Monroe
+Doctrine has stood for the equally undoubted right of the United States
+to champion and protect its primary economic interest against Europe or
+America."
+
+Through the course of a century this statement of defensive policy has
+been converted into a doctrine of economic pseudo-sovereignty. It is no
+longer a case of keeping Europe out of Latin America but of getting the
+United States into Latin America.
+
+The United States does not fear political aggression by Europe against
+the Western Hemisphere. On the contrary, the aggression to-day is
+largely economic, and the struggle for the markets and the investment
+opportunities of Latin America is being waged by the capitalists of
+every great industrial nation, including the United States.
+
+
+2. _Latin America_
+
+Four of the Latin American countries, viewed from the standpoint of
+population and of immediately available assets, rank far ahead of the
+remainder of Latin America. Mexico, with a population in 1914-1915 of
+15,502,000, had an annual government revenue of $72,687,000. The
+population of Brazil is 27,474,000. The annual revenue (1919) is
+$183,615,000. Argentine, with a population of 8,284,000, reported annual
+revenues of $159,000,000 (1918); and Chile, with a population of
+3,870,000, had an annual revenue of $77,964,000 (1917). These four
+states rank in political and economic importance close to Canada.
+
+Great Britain holds a number of strategic positions in the West Indies.
+Other nations have minor possessions in Latin America. None of these
+possessions, however, is of considerable economic or political
+importance. There remain Bolivia, Uruguay, Colombia, Ecuador, Paraguay,
+Peru, Venezuela, and the Central American states. The most populous of
+these countries is Peru (5,800,000 persons). All of the Central American
+states combined have a population of less than 6,000,000. The annual
+revenues of Uruguay (population 1,407,000) are $30,453,000 (1918-19).
+The combined government revenues of all Central America are less than
+twenty-five millions. (_Statistical Abstract of the U. S._, 1919, p.
+826ff.)
+
+Compared with the hundred million population of the United States; its
+estimated wealth (1918) of 250 billions; and its federal revenues of a
+billion and a half in 1916, the Latin American republics cut a very
+small figure indeed. The United States, bristling with economic surplus
+and armed with the Monroe Doctrine, as accepted and interpreted in the
+League Covenant, is free to turn her attention to the rich opportunities
+offered by the undeveloped territory stretching from the Rio Grande to
+Cape Horn. What is there to hinder her movements in this direction?
+Nothing but the limitation on her own needs and the adherence to her own
+public policies. This vast area, containing approximately nine million
+square miles (three times the area of continental United States), has a
+population of only a little over seventy millions. The entire government
+revenues of the territory are in the neighborhood of six hundred
+million, but so widely scattered are the people, so sharp are their
+nationalistic differences, and so completely have they failed to build
+up anything like an effective league to protect their common interests,
+that skillful maneuvering on the part of American economic and political
+interests should meet with no effectual or thoroughgoing opposition.
+
+The "hands off America" doctrine which the United States has enunciated,
+and which Europe has accepted, means first that none of the Latin
+American Republics is permitted to enter into any entangling alliances
+without the approval of the United States. In the second place it means
+that the United States is free to treat all Latin American countries in
+the same way that she has treated Cuba, Hayti and Nicaragua during the
+past twenty years.
+
+
+3. _Economic "Latin America"_
+
+The United States is the chief producer--in the Western Hemisphere--of
+the manufactured supplies needed by the relatively undeveloped countries
+of Latin America. At the same time, the undeveloped countries of Latin
+America contain great supplies of ores, minerals, timber and other raw
+materials that are needed by the expanding manufacturing interests of
+the United States. The United States is a country with an investible
+surplus. Latin America offers ample opportunity for the investment of
+that surplus. Surrounding the entire territory is a Chinese wall in the
+form of the Monroe Doctrine--intangible but none the less effective.
+
+Before the outbreak of the Great War, European capitalists dominated the
+Latin American investment market. The five years of struggle did much to
+eliminate European influence in Latin America.
+
+The situation was reviewed at length in a publication of the United
+States Department of Commerce "Investments in Latin America and the
+British West Indies," by Frederick M. Halsey (Washington Government
+Printing Office, 1918):
+
+"Concerning the undeveloped wealth of various South American countries,"
+writes Mr. Halsey, "it may be said that minerals exist in all the
+Republics, that the forest resources of all (except possibly Uruguay)
+are very extensive, that oil deposits have been found in almost every
+country and are worked commercially in Argentine, Colombia, Chile,
+Ecuador, Peru and Venezuela, and that there are lands available for the
+raising of live stock and for agricultural purposes" (p. 20).
+
+As to the pre-war investments, Mr. Halsey points out that "Great Britain
+has long been the largest investor in Latin America" (p. 20). The total
+of British investments he places at 5,250 millions of dollars. A third
+of this was invested in Argentine, a fifth in Brazil and nearly a sixth
+in Mexico. French investments are placed at about one and a half
+billions of dollars. The German investments were extensive, particularly
+in financial and trading institutions. United States investments in
+Latin America before the war "were negligible" (p. 19) outside of the
+investments in the mining industry and in the packing business.
+
+Just how much of a shift the war has occasioned in the ownership of
+Latin American railways, public utilities, mines, etc., it is impossible
+to say. Some such change has occurred, however, and it is wholly in the
+interest of the United States.
+
+Generalizations which apply to Latin America have no force in respect to
+Canada. The capitalism of Canada is closely akin to the capitalism of
+the United States.
+
+Canada possesses certain important resources which are highly essential
+to the United States. Chief among them are agricultural land and timber.
+There are two methods by which the industrial interests of the United
+States might normally proceed with relations to the Canadian resources.
+One is to attack the situation politically, the other is to absorb it
+economically. The latter method is being pursued at the present time. To
+be sure there is a large annual emigration from the United States into
+Canada (approximately 50,000 in 1919) but capital is migrating faster
+than human beings.
+
+The Canadian Bureau of Statistics reports (letter of May 20, 1920) on
+"Stocks, Bonds and other Securities held by incorporated and joint stock
+Companies engaged in manufacturing industries in Canada, 1918," as owned
+by 8,130,368 individual holders, distributed geographically as follows:
+Canada, $945,444,000; Great Britain, $153,758,000; United States,
+$555,943,000, and other countries, $17,221,322. Thus one-third of this
+form of Canadian investment is held in the United States.
+
+
+4. _American Protectorates_
+
+The close economic inter-relations that are developing in the Americas,
+naturally have their counter-part in the political field. As the
+business interests reach southward for oil, iron, sugar, and tobacco
+they are accompanied or followed by the protecting arm of the State
+Department in Washington. Few citizens of the United States realize how
+thoroughly the conduct of the government, particularly in the Caribbean,
+reflects the conduct of the bankers and the traders.
+
+Professor Hart in his "New American History" (American Book Co., 1917,
+p. 634) writes, "In addition the United States between 1906 and 1916
+obtained a protectorate over the neighboring Latin American States of
+Cuba, Hayti, Panama, Santo Domingo and Nicaragua. All together these
+five states include 157,000 square miles and 6,000,000 people."
+Professor Hart makes this statement under the general topic, "What
+America Has Done for the World."
+
+The Monroe Doctrine, logically applied to Latin America, can have but
+one possible outcome. Professor Chester Lloyd Jones characterizes that
+outcome in the following words, "Steadily, quietly, almost unconsciously
+the extension of international responsibility southward has become
+practically a fixed policy with the State Department. It is a policy
+which the record of the last sixteen years shows is followed, not
+without protest from influential factions, it is true, but none the less
+followed, by administrations of both parties and decidedly different
+shades within one of the parties.... Protests will continue but the
+logic of events is too strong to be overthrown by traditional argument
+or prejudice." ("Caribbean Interests." New York, Appleton, 1916, p.
+125.)
+
+Latin America is in the grip of the Monroe Doctrine. Whether the
+individual states wish it or not they are the victims of a principle
+that has already shorn them of political sovereignty by making their
+foreign policy subject to veto by the United States, and that will
+eventually deprive them of control over their own internal affairs by
+placing the management of their economic activities under the direction
+of business interests centering in the United States. The protectorate
+which the United States will ultimately establish over Latin America was
+forecast in the treaty which "liberated" Cuba. The resolution declaring
+war upon Spain was prefaced by a preamble which demanded the
+independence of Cuba. Presumably this independence meant the right of
+self-government. Actually the sovereignty of Cuba is annihilated by the
+treaty of July 1, 1904, which provides:
+
+"Article I. The Government of Cuba shall never enter into any treaty or
+compact with any foreign power or powers which will impair or tend to
+impair the independence of Cuba, nor in any matter authorize or permit
+any foreign power or powers to obtain by colonization or for military or
+naval purposes, or otherwise, lodgement in, or control over any portion
+of said island."
+
+The most drastic limitations upon Cuba's sovereignty are contained in
+Article 3 which reads, "the Government of Cuba consents that the United
+States may exercise the right to intervene for the preservation of Cuban
+independence, the maintenance of a government adequate for the
+protection of life, property and individual liberty, and for discharging
+the obligation with respect to Cuba imposed by the Treaty of Paris on
+the United States now to be assumed and undertaken by the Government of
+Cuba." Under this article, the United States, at her discretion, may
+intervene in Cuba's internal affairs.
+
+Under these treaty provisions the Cuban Government is not only prevented
+from exercising normal governmental functions in international matters,
+but if a change of internal government should take place which in the
+opinion of the United States jeopardized "life, property and individual
+liberty" such a government could be suppressed by the armed forces of
+the United States and a government established in conformity with her
+wishes. Theoretically, Cuba is an independent nation. Practically, Cuba
+has signed away in her treaty with the United States every important
+attribute of sovereignty.
+
+The fact that Cuba was a war-prize of the United States might be
+advanced as an explanation of her anomalous position, were it not for
+the relations now existing between the Dominican Republic, Hayti and
+Nicaragua on the one hand and the United States on the other. The United
+States has never been at war with any of these countries, yet her
+authority over them is complete.
+
+The Convention between the United States and the Dominican Republic,
+proclaimed July 25, 1907, gave the United States the right to appoint a
+receiver of Dominican customs in order that the financial affairs of the
+Republic might be placed on a sound basis. This appointment was followed
+in 1916 by the landing of the armed forces of the United States in the
+territory of the Dominican Republic. On November 29, 1916, a military
+government was set up by the United States Marine Corps under a
+proclamation approved by the President. "This military government at
+present conducts the administration of the government" (Letter from
+State Department, September 29, 1919).
+
+The proclamation issued by the Commander of the United States Marine
+Corps and approved by the President, cited the failure of the Dominican
+government to live up to its treaty obligations because of internal
+dissensions and stated that the Republic is made subject to military
+government and to the exercise of military law applicable to such
+occupation. Dominican statutes "will continue in effect insofar as they
+do not conflict with the objects of the Occupation or necessary
+relations established thereunder, and their lawful administration will
+continue in the hands of such duly authorized Dominican officials as
+may be necessary, all under the oversight and control of the United
+States forces exercising Military Government." The proclamation further
+announces that the Military Government will collect the revenues and
+hold them in trust for the Republic.
+
+Following this proclamation Captain H. S. Knapp issued a drastic order
+providing for a press censorship. "Any comment which is intended to be
+published on the attitude of the United States Government, or upon
+anything connected with the Occupation and Military Government of Santo
+Domingo must first be submitted to the local censor for approval. In
+case of any violation of this rule the publication of any newspaper or
+periodical will be suspended; and responsible persons,--owners, editors,
+or others--will further be liable to punishment by the Military
+Government. The printing and distribution of posters, handbills, or
+similar means of propaganda in order to disseminate views unfavorable to
+the United States Government or to the Military Government in Santo
+Domingo is forbidden." (Order secured from the Navy Department and
+published by The American Union against Militarism, Dec. 13, 1916.)
+
+A similar situation exists in Hayti. The treaty of May 3, 1916, provides
+that "The Government of the United States will, by its good officers,
+aid the Haitian Government in the proper and efficient development of
+its agricultural, mineral and commercial resources and in the
+establishment of the finances of Hayti on a firm and solid basis."
+(Article I) "The President of Hayti shall appoint upon nomination by the
+President of the United States a general receiver and such aids and
+employees as may be necessary to manage the customs. The President of
+Hayti shall also appoint a nominee of the President of the United States
+as 'financial adviser' who shall 'devise an adequate system of public
+accounting, aid in increasing revenues' and take such other steps 'as
+may be deemed necessary for the welfare and prosperity of Hayti.'"
+(Article II.) Article III guarantees "aid and protection of both
+countries to the General Receiver and the Financial Adviser." Under
+Article X "The Haitian Government obligates itself ... to create without
+delay an efficient constabulary, urban and rural, composed of native
+Haitians. This constabulary shall be organized and officered by
+Americans." The Haitian Government under Article XI, agrees not to
+"surrender any of the territory of the Republic by sale, lease or
+otherwise, or jurisdiction over such territory, to any foreign
+government or power" nor to enter into any treaty or contract that "will
+impair or tend to impair the independence of Hayti." Finally, to
+complete the subjugation of the Republic, Article XIV provides that
+"should the necessity occur, the United States will lend an efficient
+aid for the preservation of Haitian independence and the maintenance of
+a government adequate for the protection of life, property and
+individual liberty."
+
+A year later, on August 20, 1917, the _New York Globe_ carried the
+following advertisement:--
+
+
+                             FORTUNE IN SUGAR
+
+     "The price of labor in practically all the cane sugar growing
+     countries has gone steadily up for years, except in Hayti, where
+     costs are lowest in the world.
+
+     "_Hayti now is under U. S. Control._
+
+     "The Haitian-American corporation owns the best sugar lands in
+     Hayti, owns railroads, wharf, light and power-plants, and is
+     building sugar mills of the most modern design. There is assured
+     income in the public utilities and large profits in the sugar
+     business. We recommend the purchase of the stock of this
+     corporation. Proceedings are being taken to list this stock on the
+     New York Stock Exchange.
+
+     "Interesting story 'Sugar in Hayti' mailed on request.
+
+     "P. W. Chapman & Co., 53 William St., N. Y. C."
+
+
+Hayti remained "under United States control" until the revelations of
+the summer of 1920 (see _The Nation_, July 10 and August 28, 1920), when
+it was shown that the natives were being compelled, by the American
+forces of occupation, to perform enforced labor on the roads and to
+accept a rule so tyrannous that thousands had refused to obey the orders
+of the military authorities, and had been shot for their pains. On
+October 14, 1920, the _New York Times_ printed a statement from
+Brigadier General George Barnett, formerly Commandant General of the
+Marine Corps, covering the conditions in Hayti between the time the
+marines landed (July, 1915) and June, 1920. General Barnett alleges in
+his report that there was evidence of "indiscriminate" killing of the
+natives by the American Marines; that "shocking conditions" had been
+revealed in the trial of two members of the army of occupation, and that
+the enforced labor system should be abolished forthwith. The report
+shows that, during the five years of the occupation, 3,250 Haytians had
+been killed by the Americans. During the same period, the losses to the
+army of occupation were 1 officer and 12 men killed and 2 officers and
+26 men wounded.
+
+The attitude of the United States authorities toward the Haytians is
+well illustrated by the following telegram which the United States
+Acting Secretary of the Navy sent on October 2, 1915, to Admiral
+Caperton, in charge of the forces in Hayti: "Whenever the Haytians wish,
+you may permit the election of a president to take place. The election
+of Dartiguenave is preferred by the United States."
+
+The Cuban Treaty established the precedent; the Great War provided the
+occasion, and while Great Britain was clinching her hold in Persia, and
+Japan was strengthening her grip on Korea, the United States was engaged
+in establishing protectorates over the smaller and weaker Latin-American
+peoples, who have been subjected, one after another, to the omnipotence
+of their "Sister Republic" of the North.
+
+
+5. _The Appropriation of Territory_
+
+Protectorates have been established by the United States, where such
+action seemed necessary, over some of the weaker Latin-American states.
+Their customs have been seized, their governments supplanted by military
+law and the "preservation of law and order" has been delegated to the
+Army and Navy of the United States. The United States has gone farther,
+and in Porto Rico and Panama has appropriated particular pieces of
+territory.
+
+The Porto Ricans, during the Spanish-American War, welcomed the
+Americans as deliverers. The Americans, once in possession, held the
+Island of Porto Rico as securely as Great Britain holds India or Japan
+holds Korea. The Porto Ricans were not consulted. They had no
+opportunity for "self-determination." They were spoils of war and are
+held to-day as a part of the United States.
+
+The Panama episode furnishes an even more striking instance of the
+policy that the United States has adopted toward Latin-American
+properties that seemed particularly necessary to her welfare.
+
+Efforts to build a Panama Canal had covered centuries. When President
+Roosevelt took the matter in hand he found that the Government of
+Colombia was not inclined to grant the United States sovereignty over
+any portion of its territory. The treaty signed in 1846 and ratified in
+1848 placed the good faith of the United States behind the guarantee
+that Colombia should enjoy her sovereign rights over the Isthmus. During
+November 1902 the United States ejected the representatives of Colombia
+from what is now the Panama Canal Zone and recognized a revolutionary
+government which immediately made the concessions necessary to enable
+the United States to begin its work of constructing the canal.
+
+The issue is made clear by a statement of Mr. Roosevelt frequently
+reiterated by him (see _The Outlook_, October 7, 1911) and appearing in
+the _Washington Post_ of March 24, 1911, as follows:--"I am interested
+in the Panama Canal because I started it. If I had followed the
+traditional conservative methods I would have submitted a dignified
+state paper of probably two hundred pages to the Congress and the debate
+would have been going on yet. But I took the Canal Zone and let the
+Congress debate, and while the debate goes on, the Canal does also."
+
+Article 35 of the Treaty of 1846 between the United States and Colombia
+(then New Grenada) reads as follows,--"The United States guarantees,
+positively and efficaciously to New Grenada, by the present stipulation,
+the perfect neutrality of the before mentioned Isthmus ... and the
+rights of sovereignty which New Grenada has and possesses over said
+territory."
+
+In 1869 another treaty was negotiated between the United States and
+Colombia which provided for the building of a ship canal across the
+Isthmus. This treaty was signed by the presidents of both republics and
+ratified by the Colombian Congress. The United States Senate refused its
+assent to the treaty. Another treaty negotiated early in 1902 was
+ratified by the United States Senate but rejected by the Colombian
+Congress. The Congress of the United States had passed an act (June 28,
+1902) "To provide for the construction of a canal connecting the waters
+of the Atlantic and the Pacific Oceans." Under this act the President
+was authorized to negotiate for the building of the canal across the
+Isthmus of Panama. If that proved impossible within a reasonable time,
+the President was to turn to the Nicaragua route. The treaty prepared in
+accordance with this act provided that the United States would pay
+Colombia ten millions of dollars in exchange for the sovereignty over
+the Canal Zone. The Colombian Congress after a lengthy debate rejected
+the treaty and adjourned on the last day of October, 1902.
+
+Rumor had been general that if the treaty was not ratified by the
+Colombian Government, the State of Panama would secede from Colombia,
+sign the treaty, and thus secure the ten millions. In consequence of
+these rumors, which threatened transportation across the Isthmus,
+American war vessels were dispatched to Panama and to Colon.
+
+On November 3, 1902, the Republic of Panama was established. On November
+13 it was recognized by the United States. Immediately thereafter a
+treaty was prepared and ratified by both governments and the ten
+millions were paid to the Government of Panama.
+
+Early in the day of November 3, the Department of State was informed
+that an uprising had occurred. Mr. Loomis wired, "Uprising on Isthmus
+reported. Keep Department promptly and fully informed." In reply to this
+the American consul replied, "The uprising has not occurred yet; it is
+announced that it will take place this evening. The situation is
+critical." Later the same official advised the Department that (in the
+words of the Presidential message, 1904) "the uprising had occurred and
+had been successful with no bloodshed."
+
+The Colombian Government had sent troops to put down the insurrection
+but the Commander of the United States forces, acting under instructions
+sent from Washington on November 2, prevented the transportation of the
+troops. His instructions were as follows,--"Maintain free and
+uninterrupted transit if interruption is threatened by armed force with
+hostile intent, either governmental or insurgent, at any point within
+fifty miles of Panama. Government forces reported approaching the
+Isthmus in vessels. Prevent their landing, if, in your judgment, the
+landing would precipitate a conflict."
+
+Thus a revolution was consummated under the watchful eye of the United
+States forces; the home government at Bogota was prevented from taking
+any steps to secure the return of the seceding state of Panama to her
+lawful sovereignty, and within ten days of the revolution, the new
+Republic was recognized by the United States Government.[57] (Ten days
+was the length of time necessary to transmit a letter from Panama to
+Washington. Greater speed would have been impossible unless the new
+state had been recognized by telegraph.)
+
+
+6. _The Logical Exploiters_
+
+The people of the United States are the logical exploiters of the
+Western Hemisphere--the children of destiny for one half the world. They
+are pressed by economic necessity. They need the oil of Mexico, the
+coffee of Brazil, the beef of Argentine, the iron of Chile, the sugar of
+Cuba, the tobacco of Porto Rico, the hemp of Yucatan, the wheat and
+timber of Canada. In exchange for these commodities the United States is
+prepared to ship manufactured products. Furthermore, the masters of the
+United States have an immense and growing surplus that must be invested
+in some paying field, such as that provided by the mines, agricultural
+projects, timber, oil deposits, railroad and other industrial activities
+of Latin-America.
+
+The rulers of the United States are the victims of an economic necessity
+that compels them to seek and to find raw materials, markets and
+investment opportunities. They are also the possessors of sufficient
+economic, financial, military and naval power to make these needs good
+at their discretion.
+
+The rapidly increasing funds of United States capital invested in
+Latin-America and Canada, will demand more and more protection. There is
+but one way for the United States to afford that protection--that is to
+see that these countries preserve law and order, respect property, and
+follow the wishes of United States diplomacy. Wherever a government
+fails in this respect, it will be necessary for the State Department in
+cooperation with the Navy, to see that a government is established that
+will "make good."
+
+Under the Monroe Doctrine, as it has long been interpreted, no
+Latin-American Government will be permitted to enter into entangling
+alliances with Europe or Asia. Under the Monroe Doctrine, as it is now
+being interpreted, no Latin-American people will be permitted to
+organize a revolutionary government that abolishes the right of private
+interests to own the oil, coal, timber and other resources. The mere
+threat of such action by the Carranza Government was enough to show what
+the policy of the United States must be in such an emergency.
+
+The United States need not dominate politically her weaker sister
+republics. It is not necessary for her to interfere with their
+"independence." So long as their resources may be exploited by American
+capitalists; so long as the investments are reasonably safe; so long as
+markets are open, and so long as the other necessities of United States
+capitalism are fulfilled, the smaller states of the Western Hemisphere
+will be left free to pursue their various ways in prosperity and peace.
+
+FOOTNOTE:
+
+[57] For further details see "The Panama Canal" Papers presented to the
+Senate by Mr. Lodge, Senate Document 471, 63rd Congress, 2nd Session.
+
+
+
+
+XVI. THE AMERICAN CAPITALISTS AND WORLD EMPIRE
+
+
+1. _The Plutocrats Must Carry On_
+
+The American plutocrats--those who by force of their wealth share in the
+direction of public policy--must carry on. They have no choice. If they
+are to continue as plutocrats, they must continue to rule. If they
+continue to rule, they must shoulder the duties of rulership. They may
+not relish the responsibility which their economic position has thrust
+upon them any more than the sojourners in Newfoundland relish the savage
+winters. Nevertheless, those who own the wealth of a capitalist nation
+must accept the results of that ownership just as those who remain in
+Newfoundland must accept the winter storms.
+
+The owners of American timber, mines, factories, railroads, banks and
+newspapers may dislike the connotations of imperialism; may believe
+firmly in the principles of competition and individualism; may yearn for
+the nineteenth century isolation which was so intimate a feature of
+American economic life. But their longings are in vain. The old world
+has passed forever; the sun has risen on a new day--a day of world
+contacts for the United States.
+
+Henry Cabot Lodge of Massachusetts stated the matter with rare accuracy
+in a speech which he made during the discussion over the conquest of the
+Philippines. After explaining that wars come, "never ostensibly, but
+actually from economic causes," Senator Lodge said (_Congressional
+Record_, 56th Congress, 2nd Session, p. 637. January 7, 1901):
+
+"We occupy a great position economically. We are marching on to a still
+greater one. You may impede it, you may check it, but you cannot stop
+the work of economic forces. You cannot stop the advance of the United
+States.... The American people and the economic forces which underlie
+all are carrying us forward to the economic supremacy of the world."
+
+Senator Lodge spoke the economic truth in 1901. William C. Redfield
+reenforced it in an address before the American Manufacturers Export
+Association (_Weekly Bulletin_, April 26, 1920, p. 7): "We cannot be
+foreign merchants very much longer in this country excepting on a
+diminishing and diminishing scale--we have got to become foreign
+constructors; we have got to build with American money--foreign
+enterprises, railroads, utilities, factories, mills, I know not what, in
+order that by large ownership in them we may command the trade that
+normally flows from their operation." That is sound capitalist doctrine.
+Equally sound is the exhortation that follows: "In so doing we shall be
+doing nothing new--only new for us. That is the way in which Germany and
+Great Britain have built up their foreign trade."
+
+New it is for America--but it is the course of empire, familiar to every
+statesman. The lesson which Bismarck, Palmerston and Gray learned in the
+last century is now being taught by economic pressure to the ruling
+class of the United States.
+
+The elder generation of American business men was not trained for world
+domination. To them the lesson comes hard. The business men of the
+younger generation are picking it up, however, with a quickness born of
+paramount necessity.
+
+
+2. _Training Imperialists_
+
+Every great imperial structure has had simple beginnings. Each imperial
+ruling class has doubtless felt misgivings, during the early years of
+its authority. Hesitating, uncertain, they have cast glances over their
+shoulders towards that which was, but even while they were looking
+backward the forces that had made them rulers were thrusting them still
+farther forward along the path of imperial power. Then as generation
+succeeded generation, the rulers learned their lesson, building a
+tradition of rulership and authority that was handed down from father to
+son; acquiring a vision of world organization and world power that gave
+them confidence to go forward to their own undoing. The masters of
+public life in Rome were such people; the present masters of British
+economic and political affairs are such people.
+
+American imperialists still are in the making. Until 1900 their eyes
+were set almost exclusively upon empire within the United States. Those
+who, before 1860, dreamed of a slave power surrounding the Gulf of
+Mexico, were thrust down and their places taken by builders of railroads
+and organizers of trusts. To-day the sons and grandsons of that
+generation of exploiters who confined their attention to continental
+territory, are compelled, by virtue of the organization which their
+sires and grandsires established, to seek Empire outside the boundaries
+of North America.
+
+During the years when the leaders of American business life were
+spending the major part of their time in "getting rich," the sweep of
+social and economic forces was driving the United States toward its
+present imperial position. Now the position has been attained, those in
+authority have no choice but to accept the responsibilities which
+accompany it.
+
+Economically the United States is a world power. The war and the
+subsequent developments have forced the country suddenly into a position
+of leadership among the capitalist nations. The law of capitalism is:
+Struggle to dispose of your surplus, otherwise you cannot survive. This
+law has laid its heavy hand upon Great Britain, upon France, upon
+Germany, and now it has struck with full force into the isolated,
+provincial life of the United States. It is the law--immutable as the
+system of gravitation. While the present system of economic life
+exists, this law will continue to operate. Therefore the masters of
+American life have no alternative. If they would survive, they must
+dispose of their surplus.
+
+Politically the United States is recognized as one of the leaders of the
+world. Despite its tradition of isolation, despite the unwillingness of
+its statesmen to enter new paths, despite the indifference of its people
+to international affairs, the resources and raw materials required by
+the industrial nations of Europe, the rapidly growing surplus and the
+newly acquired foreign markets and investments make the United States an
+integral part of the life of the world.
+
+The ruling class in the United States has no more choice than the rulers
+of a growing city whose boundaries are extending with each increment of
+population. If it is to continue as a ruling class, it must accept
+conditions as they are. The first of these conditions is that the United
+States is a world power neither because of its virtue nor because of its
+intelligence in the delicacies of the world politics, but because of the
+sheer might of its economic organization.
+
+Economic necessity has forced the United States into the front rank
+among the nations of the world. Economic necessity is forcing the ruling
+class of the United States to occupy the position of world leadership,
+to strengthen it, to consolidate it, and to extend it at every
+opportunity. The forces that played beside the yellow Tiber and the
+sluggish Nile are very much the same as those which led Napoleon across
+the wheat fields of Europe and that are to-day operating in Paris,
+London, and in New York. The forces that pushed the Roman Empire into
+its position of authority and led to the organization of Imperial
+Britain are to-day operating with accelerated pace in the United States.
+The sooner the American people, and particularly those who are directing
+public policy, wake up to this simple but essential fact, the sooner
+will doubt and misunderstanding be removed, the sooner will the issues
+be drawn and the nation's course be charted.
+
+
+3. _The Logical Goal_
+
+The logical goal of the American plutocracy is the economic and
+incidentally the political control of the world. The rulers of Macedon
+and Assyria, Rome and Carthage, of Britain and France labored for
+similar reasons to reach this same goal. It is economic fate. Kings and
+generals were its playthings, obeying and following the call of its
+destiny.
+
+The rulers of antiquity were limited by a lack of transportation
+facilities; their "world" was small, including the basin of the
+Mediterranean and the land surrounding the Persian Gulf and the Indian
+Ocean, nevertheless, they set out, one after another, to conquer it.
+To-day the rapid accumulation of surplus and the speed and ease of
+communication, the spread of world knowledge and the larger means of
+organization make it even more necessary than it was of old for the
+rulers of an empire to find a larger and ever larger place in the sun.
+The forces are more pressing than ever before. The times call more
+loudly for a genius with imagination, foresight and courage who will use
+the power at his disposal to write into political history the gains that
+have already been made a part of economic life. Let such a one arise in
+the United States, in the present chaos of public thought, and he could
+not only himself dictate American public policy for the remainder of his
+life, but in addition, he could, within a decade, have the whole
+territory from the Canadian border to the Panama Canal under the
+American Flag, either as conquered or subject territory; he could
+establish a Chinese wall around South American trade and opportunities
+by a very slight extension of the Monroe Doctrine; he could have in hand
+the problem of an economic if not a political union with Canada, and
+could be prepared to measure swords with the nearest economic rival,
+either on the high seas or in any portion of the world where it might
+prove necessary to join battle.
+
+Such a program would be a departure from the traditions of American
+public life, but the traditions, built by a nation of farmers, have
+already lost their significance. They are historic, with no contemporary
+justification. The economic life that has grown up since 1870 of
+necessity will create new public policies.
+
+The success of such a program would depend upon four things:
+
+1. A coordination of American economic life.
+
+2. A fast grip on the agencies for shaping public opinion.
+
+3. A body of citizens, martial, confident, restless, ambitious.
+
+4. A ruling class with sufficient imagination to paint, in warm
+sympathetic colors, the advantages of world dominion; and with
+sufficient courage to follow out imperial policy, regardless of ethical
+niceties, to its logical goal of world conquest.
+
+All four of these requisites exist in the United States to-day, awaiting
+the master hand that shall unite them. Many of the leaders of American
+public life know this. Some shrink from the issue, because they are
+unaccustomed to dream great dreams, and are terrified by the immensity
+of large thoughts. Others lack the courage to face the new issues. Still
+others are steadily maneuvering themselves into a position where they
+may take advantage of a crisis to establish their authority and work
+their imperial will. The situation grows daily more inviting; the
+opportunity daily more alluring. The war-horse, saddled and bridled, is
+pawing the earth and neighing. How soon will the rider come?
+
+
+4. _Eat or Be Eaten_
+
+The American ruling class has been thrown into a position of authority
+under a system of international economic competition that calls for
+initiative and courage. Under this system, there are two
+possibilities,--eat or be eaten!
+
+There is no middle ground, no half way measure. It is impossible to
+stop or to turn back. Like men engaged on a field of battle, the
+contestants in this international economic struggle must remain with
+their faces toward the enemy, fighting for every inch that they gain,
+and holding these gains with their bodies and their blood, or else they
+must turn their backs, throw away their weapons, run for their lives,
+and then, hiding on the neighboring hills, watch while the enemy
+despoils the camp, and then applies a torch to the ruins.
+
+The events of the great war prove, beyond peradventure, that in the wolf
+struggle among the capitalist nations, no rules are respected and no
+quarter given. Again and again the leaders among the allied
+statesmen--particularly Mr. Lloyd George and Mr. Wilson--appealed to the
+German people over the heads of their masters with assurances that the
+war was being fought against German autocracy, not against Germans.
+"When will the German people throw off their yoke?" asked one Allied
+diplomat. The answer came in November, 1918. A revolution was contrived,
+the Kaiser fled the country, the autocracy was overthrown. Germans
+ceased to fight with the understanding that Mr. Wilson's Fourteen Points
+should be made the foundation of the Peace. The armistice terms violated
+the spirit if not the letter of the fourteen points; the Peace Treaty
+scattered them to the winds. Under its provisions Germany was stripped
+of her colonies; her investments in the allied possessions were
+confiscated; her ships were taken; three-quarters of her iron ore and a
+third of her coal supply were turned over to other powers; motor trucks,
+locomotives, and other essential parts of her economic mechanism were
+appropriated. Austria suffered an even worse fate, being "drawn and
+quartered" in the fullest sense of the term. After stripping the
+defeated enemies of all available booty, levying an indeterminate
+indemnity, and dismembering the German and Austrian Empires, the Allies
+established for thirty years a Reparation Commission, which is virtually
+the economic dictator of Europe. Thus for a generation to come, the
+economic life of the vanquished Empires will be under the active
+supervision and control of the victors. Never did a farmer's wife pluck
+a goose barer than the Allies plucked the Central Powers. (See the
+Treaty, also "The Economic Consequences of the Peace," J. M. Keynes. New
+York, Harcourt, Brace & Howe, 1920.)
+
+Under the armistice terms and the Peace Treaty the Allies did to Germany
+and Austria exactly what Germany and Austria would have done to France
+and Great Britain had the war turned out differently. The Allied
+statesmen talked much about democracy, but when their turn came they
+plundered and despoiled with a practiced imperial hand. France and
+Britain, as well as Germany and Austria, were capitalist Empires. The
+Peace embodies the essential economic morality of capitalist
+imperialism, the morality of "Eat or be eaten."
+
+
+5. _The Capitalists and War_
+
+The people and even the masters of America are inexperienced in this
+international struggle. Among themselves they have experimented with
+competitive industrialism on a national scale. Now, brought face to face
+with the world struggle, many of them revolt against it. They deplore
+the necessities that lead nations to make war on one another. They
+supported the late war "to end war." They gave, suffered and sacrificed
+with a keen, idealistic desire to "make the world safe for democracy."
+They might as well have sought to scatter light and sunshine from a
+cloudbank.
+
+The masters of Europe, who have learned their trade in long years of
+intrigue, diplomacy and war, feel no such repugnance. They play the
+game. The American people are of the same race-stocks as the leading
+contestants in the European struggle. They are not a whit less
+ingenious, not a whit less courageous, not a whit less determined. When
+practice has made them perfect they too will play the game just as well
+as their European cousins and their play will count for more because of
+the vast economic resources and surpluses which they possess.
+
+American statesmen in the field of international diplomacy are like
+babies, taking their first few steps. Later the steps come easier and
+easier, until a child, who but a few months ago could not walk, has
+learned to romp and sport about. The masters of the United States are
+untrained in the arts of international intrigue. They showed their
+inferiority in the most painful way during the negotiations over the
+Paris Treaty. They are as yet unschooled in international trade, banking
+and finance. They are also inexperienced in war, yet, having only raw
+troops, and little or no equipment, within two years they made a notable
+showing on the battlefields of Europe. Now they are busy learning their
+financial lessons with an equal facility. A generation of contact with
+world politics will bring to the fore diplomats capable of meeting
+Europe's best on their own ground. What Europe has learned, America can
+learn; what Europe has practiced, America can practice, and in the end
+she may excel her teachers.
+
+To-day economic forces are driving relentlessly. Surplus is accumulating
+in a geometric ratio--surplus piling on surplus. This surplus must be
+disposed of. While the remainder of the world--except Japan--is
+staggering under intolerable burdens of debt and disorganization, the
+United States emerges almost unscathed from the war, and prepares in
+dead earnest to enter the international struggle,--to play at the master
+game of "eat or be eaten."
+
+Pride, ambition and love of gain and of power are pulling the American
+plutocrats forward. The world seems to be within their grasp. If they
+will reach out their hands they may possess it! They have assumed a
+great responsibility. As good Americans worthy of the tradition of their
+ancestors, they must see this thing through to the end! They must win,
+or die in the attempt; and it is in this spirit that they are going
+forward.
+
+The American capitalists do not want war with Great Britain or with any
+other country. They are not seeking war. They will regret war when it
+comes.
+
+War is expensive, troublesome and dangerous. The experiences of Europe
+in the War of 1914 have taught some lessons. The leaders and thinkers
+among the masters of America have visited Europe. They have seen the old
+institutions destroyed, the old customs uprooted, the old faiths
+overturned. They have seen the economic order in which they were vitally
+concerned hurled to the earth and shattered. They have seen the red flag
+of revolution wave where they had expected nothing but the banner of
+victory. They have seen whole populations, weary of the old order, throw
+it aside with an impatient gesture and bring a new order into being.
+They have good reasons to understand and fear the disturbing influences
+of war. They have felt them even in the United States--three thousand
+miles away from the European conflict. How much more pressing might this
+unrest be if the United States had fought all through the war, instead
+of coming in when it was practically at an end!
+
+Then there is always the danger of losing the war--and such a loss would
+mean for the United States what it has meant for Germany--economic
+slavery.
+
+Presented with an opportunity to choose between the hazards of war and
+the certainties of peace most of the capitalist interests in the United
+States would without question choose peace. There are exceptions. The
+manufacturers of munitions and of some of the implements and supplies
+that are needed only for war purposes, undoubtedly have more to gain
+through war than through peace, but they are only a small element in a
+capitalist world which has more to gain through peace than through war.
+
+But the capitalists cannot choose. They are embedded in an economic
+system which has driven them--whether they liked it or not--along a path
+of imperialism. Once having entered upon this path, they are compelled
+to follow it into the sodden mire of international strife.
+
+
+6. _The Imperial Task_
+
+The American ruling class--the plutocracy--must plan to dominate the
+earth; to exploit it, to exact tribute from it. Rome did as much for the
+basin of the Mediterranean. Great Britain has done it for Africa and
+Australia, for half of Asia, for four million square miles in North
+America. If the people of one small island, poorly equipped with
+resources, can achieve such a result, what may not the people of the
+United States hope to accomplish?
+
+That is the imperial task.
+
+
+     1. American economic life must be unified. Already much of this
+     work has been done.
+
+     2. The agencies for shaping public opinion must be secured. Little
+     has been left for accomplishment in this direction.
+
+     3. A martial, confident, restless, ambitious spirit must be
+     generated among the people. Such a result is being achieved by the
+     combination of economic and social forces that inhere in the
+     present social system.
+
+     4. The ruling class must be schooled in the art of rulership. The
+     next two generations will accomplish that result.
+
+
+The American plutocracy must carry on. It must consolidate its gains and
+move forward to greater achievements, with the goal clearly in mind and
+the necessities of imperial power thoroughly mastered and understood.
+
+
+
+
+XVII. THE NEW IMPERIAL ALIGNMENT
+
+
+1. _A Survey of the Evidence_
+
+Through the centuries empires have come and gone. In each age some
+nation or people has emerged--stronger, better organized, more
+aggressive, more powerful than its neighbors--and has conquered
+territory, subjugated populations, and through its ruling class has
+exploited the workers at home and abroad.
+
+Europe has been for a thousand years the center of the imperial
+struggle,--the struggle which called into being the militarism so hated
+by the European peoples. It was from that struggle that millions fled to
+America, where they hoped for liberty and peace.
+
+The eighteenth century witnessed the rise of Great Britain to a position
+of world authority. During the nineteenth century she held her place
+against all rivals. With the assistance of Prussia, she overthrew
+Napoleon at Waterloo. In the Crimean War and the Russo-Japanese War she
+halted the power of the Czar. Half a century after Waterloo Germany,
+under the leadership of Prussia won the Franco-Prussian War, and by that
+act became the leading rival of the British Empire. Following the war,
+which gave Germany control of the important resources included in Alsace
+and Lorraine, there was a steady increase in her industrial efficiency;
+the success of her trade was as pronounced as the success of her
+industries, and by 1913 the Germans had a merchant fleet and a navy
+second only to those of Great Britain.
+
+Germany's economic successes, and her threat to build a railroad from
+Berlin to Bagdad and tap the riches of the East, led the British to form
+alliances with their traditional enemies--the French and the Russians.
+Russia, after the breakdown of Czarism in 1917, dropped out of the
+Entente, and the United States took her place among the Allies of the
+British Empire. During the struggle France was reduced to a mere shell
+of her former power. The War of 1914 bled her white, loaded her with
+debt, disorganized her industries, demoralized her finances, and
+although it restored to her important mineral resources, it left her too
+weak and broken to take real advantage of them.
+
+The War of 1914 decided the right of Great Britain to rule the Near East
+as well as Southern Asia and the strategic points of Africa. In the
+stripping of the vanquished and in the division of the spoils of war the
+British lion proved to be the lion indeed. But the same forces that gave
+the British the run of the Old World called into existence a rival in
+the New.
+
+People from Britain, Germany and the other countries of Northern Europe,
+speaking the English language and fired with the conquering spirit of
+the motherland, had been, for three centuries, taming the wilderness of
+North America. They had found the task immense, but the rewards equally
+great. When the forces of nature were once brought into subjection, and
+the wilderness was inventoried, it proved to contain exactly those
+stores that are needed for the success of modern civilization. With the
+Indians brushed aside, and the Southwest conquered from Mexico, the new
+ruling class of successful business men established itself, and the
+matter of safeguarding property rights, of building industrial empires
+and of laying up vast stores of capital and surplus followed as a matter
+of course.
+
+Europe, busy with her own affairs, paid little heed to the New World,
+except to send to it some of her most rugged stock and much of her
+surplus wealth. The New World, left to itself, pursued its way--in
+isolation, and with an intensity proportioned to the size of the task in
+hand and the richness of the reward.
+
+The Spanish War in 1898 and the performance of the Canadians in the Boer
+War of 1899 astounded the world, but it was the War of 1914 that really
+waked the Europeans to the possibilities of the Western peoples. The
+Canadians proved their worth to the British armies. The Americans showed
+that they could produce prodigious amounts of the necessaries of war,
+and when they did go in, they inaugurated a shipping program, raised and
+dispatched troops, furnished supplies and provided funds to an extent
+which, up to that time, was considered impossible. The years from 1914
+to 1918 established the fact that there was, in the West, a colossus of
+economic power.
+
+
+2. _The New International Line-Up_
+
+There are four major factors in the new international line-up. The first
+is Russia; the second is the Japanese Empire; the third is the British
+Empire and the fourth is the American Empire. Italy has neither the
+resources, the wealth nor the population necessary to make her a factor
+of large importance in the near future. France is too weak economically,
+too overloaded with debt and too depleted in population to play a
+leading role in world affairs.
+
+The Russian menace is immediate. Bolshevism is not only the antithesis
+of Capitalism but its mortal enemy. If Bolshevism persists and spreads
+through Central Europe, India and China, capitalism will be wiped from
+the earth.
+
+A federation of Russia, the Baltic states, the new border provinces, and
+the Central Empires on a socialist basis would give the socialist states
+of central and northern Europe most of the European food area, a large
+portion of the European raw material area and all of the technical skill
+and machinery necessary to make a self-supporting economic unit. The two
+hundred and fifty millions of people in Russia and Germany combined in
+such a socialist federation would be as irresistible economically as
+they would be from a military point of view.
+
+Such a Central European federation, developing as it must along the
+logical lines that lead into India and China would be the strongest
+single unit in the world, viewed from the standpoint of resources, of
+population, of productive power or of military strength. The only
+possible rivals to such a combination would be the widely scattered
+forces of the British Empire and the United States, separated from it by
+the stretches of the Atlantic Ocean. Against such a grouping Japan would
+be powerless because it would deprive her of the source of raw materials
+upon which she must rely for her economic development. Great Britain
+with her relatively small population and her rapidly diminishing
+resources could make no head against such a combination even with the
+assistance of her colonial empire. Northern India is as logical a home
+for Bolshevism as Central China or South-eastern Russia. Connect
+European Russia, Germany, Austria-Hungary, Siberia, India and China with
+bonds that make effective cooperation possible and these
+countries--containing nearly two-thirds of the population of the world,
+and possessed of the resources necessary to maintain a modern
+civilization--could laugh at outside interference.
+
+Two primary difficulties confront the organizers of the Federated
+Socialist Republics of Europe and Asia. One is nationality, language,
+custom and tradition, together with the ancient antagonisms which have
+been so carefully nurtured through the centuries. The other is the
+frightful economic disorganization prevalent throughout Central
+Europe,--a disorganization which would be increased rather than
+diminished by the establishment of new forms of economic life. Even if
+such an organization were perfected, it must remain, for a long time to
+come, on a defensive basis.
+
+
+3. _The Yellow Peril_
+
+The "yellow peril" thus far is little more than the Japanese menace to
+British and American trade in the Far East. The Japanese Archipelago is
+woefully deficient in coal, iron, petroleum, water power and
+agricultural land. The country is over-populated and must depend for
+its supplies of food and raw materials upon continental Asia. There
+seems to be no probability that Japan and China can make any effective
+working agreement in the near future that will constitute an active
+menace to the supremacy of the white race. Alone Japan is too weak in
+resources and too sparse in population. Combined with China she would be
+formidable, but her military policy in Korea and in the Shantung
+Province have made any effective cooperation with China at least
+temporarily impossible.
+
+Furthermore, the Japanese are not seeking world conquest. On the
+contrary, they are bent upon maintaining their traditional aloofness by
+having a Monroe Doctrine for the East. This doctrine will be summed up
+in the phrase, "The East for the Easterners,"--the easterners being the
+Japanese. Such a policy would prove a serious menace to the trade of the
+United States and of Great Britain. It would prove still more of a
+hindrance to the investment of American and British capital in the very
+promising Eastern enterprises, and would close the door on the Western
+efforts to develop the immense industrial resources of China. The recent
+"Chinese Consortium," in which Japan joined with great reluctance,
+suggests that the major capitalist powers have refused to recognize the
+exclusive right of Japan to the economic advantages of the Far East. How
+seriously this situation will be taken by the United States and Great
+Britain depends in part upon the vigor with which Japan prosecutes her
+claims and in part upon the preoccupation of these two great powers with
+Bolshevism in Europe and with their own competitive activities in ship
+building, trade, finance and armament.
+
+
+4. _The British and the American Empires_
+
+The two remaining major forces in world economics and politics are the
+British Empire and the American Empire,--the mistress of the world, and
+her latest rival in the competition for world power. Between them,
+to-day, most of the world is divided. The British Empire includes the
+Near East, Southern Asia, Africa, Australia and half of North America.
+Dogging her are Germany, France, Russia and Italy, and, as she goes to
+the Far East,--Japan. The United States holds the Western Hemisphere,
+where she is supreme, with no enemy worthy the name.
+
+The British power was shaken by the War of 1914. Never, in modern times,
+had the British themselves, been compelled to do so much of the actual
+fighting. The war debt and the disorganization of trade incident to the
+war period proved serious factors in the curtailment of British economic
+supremacy. At the same time, the territorial gains of the British were
+enormous, particularly in the Near East.
+
+The Americans secured real advantages from the war. They grew immensely
+rich in profiteering during the first three years, they emerged with a
+relatively small debt, with no great loss of life, and with the greatest
+economic surpluses and the greatest immediate economic advantages
+possessed by any nation of the world.
+
+The British Empire was the acknowledged mistress of the world in 1913.
+Her nearest rival (Germany) had one battleship to her two; one ton of
+merchant shipping to her three, and two dollars of foreign investments
+to her five. This rivalry was punished as the successive rivals of the
+British Empire have been punished for three hundred years.
+
+The war was won by the British Empire and her Allies, but in the hour of
+victory a new rival appeared. By 1920 that rival had a naval program
+which promised a fleet larger than the British fleet in 1924 or 1925;
+within three years she had increased her merchant tonnage to two-thirds
+of the British tonnage, and her foreign investments were three times the
+foreign investments of Great Britain. This new rival was the American
+Empire--whose immense economic strength constituted an immediate threat
+to the world power of Great Britain.
+
+
+5. _The Next Incident in the Great War_
+
+Some nation, or some group of nations has always been in control of the
+known world or else in active competition for the right to exercise such
+a control. The present is an era of competition.
+
+Capitalism has revolutionized the world's economic life. By 1875 the
+capitalist nations were in a mad race to determine which one should
+dominate the capitalist world and have first choice among the
+undeveloped portions of the earth. The competitors were Great Britain,
+Germany, France, Russia and Italy. Japan and the United States did not
+really enter the field for another generation.
+
+The War of 1914 decided this much:--that France and Italy were too weak
+to play the big game in a big way, that Germany could not compete
+effectively for some time to come; that the Russians would no longer
+play the old game at all. There remained Japan, Great Britain and the
+United States and it is among these three nations that the capitalist
+world is now divided. Japan is in control of the Far East. Great Britain
+holds the Near East, Africa and Australia; the United States dominates
+the Western Hemisphere.
+
+The Great War began in 1914. It will end when the question is decided as
+to which of these three empires will control the Earth.
+
+Great Britain has been the dominant factor in the world for a century.
+She gained her position after a terrific struggle, and she has
+maintained it by vanquishing Holland, Spain, France and Germany.
+
+The United States is out to capture the economic supremacy of the earth.
+Her business men say so frankly. Her politicians fear that their
+constituents are not as yet ready to take such a step. They have been
+reassured, however, by the presidential vote of November, 1920.
+American business life already is imperial, and political sentiment is
+moving rapidly in the same direction.
+
+Great Britain holds title to the pickings of the world. America wants
+some or all of them. The two countries are headed straight for a
+conflict, which is as inevitable as morning sunrise, unless the menace
+of Bolshevism grows so strong, and remains so threatening that the great
+capitalist rivals will be compelled to join forces for the salvation of
+capitalist society.
+
+As economic rivalries increase, competition in military and naval
+preparation will come as a matter of course. Following these will be the
+efforts to make political alliances--in the East and elsewhere.
+
+These two countries are old time enemies. The roots of that enmity lie
+deep. Two wars, the white hot feeling during the Civil War, the
+anti-British propaganda, carried, within a few years, through the
+American schools, the traditions among the officers in the American
+navy, the presence of 1,352,251 Irish born persons in the United States
+(1910), the immense plunder seized by the British during the War of
+1914,--these and many other factors will make it easy to whip the
+American people into a war-frenzy against the British Empire.
+
+Were there no economic rivalries, such antagonisms might slumber for
+decades, but with the economic struggle so active, these other matters
+will be kept continually in the foreground.
+
+The capitalists of Great Britain have faced dark days and have
+surmounted huge obstacles. They are not to be turned back by the threat
+of rivalry. The American capitalists are backed by the greatest
+available surpluses in the world; they are ambitious, full of enthusiasm
+and energy, they are flushed with their recent victory in the world war,
+and overwhelmed by the unexpected stores of wealth that have come to
+them as a result of the conflict. They are imbued with a boundless faith
+in the possibilities of their country. Neither Great Britain nor the
+United States is in a frame of mind to make concessions. Each is
+confident--the British with the traditional confidence of centuries of
+world leadership; the Americans with the buoyant, idealistic confidence
+of youth. It is one against the other until the future supremacy of the
+world is decided.
+
+
+6. _The Imperial Task_
+
+American business interests are engaged in the work of building an
+international business structure. American industry, directed from the
+United States, exploiting foreign resources for American profit, and
+financed by American institutions, is gaining a footing in Latin
+America, in Europe and Asia.
+
+The business men of Rome built such a structure two thousand years ago.
+They competed with and finally crushed their rivals in Tyre, Corinth and
+Carthage. In the early days of the Empire, they were the economic
+masters, as well as the political masters of the known world.
+
+Within two centuries the business men of Great Britain have built an
+international business structure that has known no equal since the days
+of the Caesars. Perhaps it is greater, even, than the economic empire of
+the Romans. At any rate, for a century that British empire of commerce
+and industry has gone unchallenged, save by Germany. Germany has been
+crushed. But there is an industrial empire rising in the West. It is
+new. Its strength is as yet undetermined. It is uncoordinated. A new era
+has dawned, however, and the business men of the United States have made
+up their minds to win the economic supremacy of the earth.
+
+Already the war is on between Great Britain and the United States. The
+two countries are just as much at war to-day as Great Britain and
+Germany were at war during the twenty years that preceded 1914. The
+issues are essentially the same in both cases,--commercial and economic
+in character, and it is these economic and commercial issues that are
+the chief causes of modern military wars--that are in themselves
+economic wars which may at any moment be transferred to the military
+arena.
+
+British capitalists are jealously guarding the privileges that they have
+collected through centuries of business and military conflict. The
+American capitalists are out to secure these privileges for themselves.
+On neither side would a military settlement of the issue be welcomed. On
+both sides it would be regarded as a painful necessity. War is an
+incident in imperialist policy. Yet the position of the imperialist as
+an international exploiter depends upon his ability to make war
+successfully. War is a part of the price that the imperialist must pay
+for his opportunity to exploit and control the earth.
+
+After Sedan, it was Germany versus Great Britain for the control of
+Europe. After Versailles it is the United States versus Great Britain
+for the control of the capitalist earth. Both nations must spend the
+next few years in active preparation for the conflict.
+
+The governments of Great Britain and the United States are to-day on
+terms of greatest intimacy. Soon an issue will arise--perhaps over
+Mexico, perhaps over Persia, perhaps over Ireland, perhaps over the
+extension of American control in the Caribbean. There is no difficulty
+of finding a pretext.
+
+Then there will follow the time-honored method of arousing the people on
+either side to wrath against those across the border. Great Britain will
+point to the race-riots and negro-lynchings in America as a proof that
+the people of the United States are barbarians. British editors will
+cite the wanton taking of the Canal Zone as an indication of the
+willingness of American statesmen to go to any lengths in their effort
+to extend their dominion over the earth. The newspapers of the United
+States will play up the terrorism and suppression in Ireland and there
+are many Irishmen more than ready to lend a hand in such an enterprise;
+tyranny in India will come in for a generous share of comment; then
+there are the relations between Great Britain and the Turks, and above
+all, there are the evidences in the Paris Treaty of the way in which
+Great Britain is gradually absorbing the earth. Unless the power of
+labor is strong enough to turn the blow, or unless the capitalists
+decide that the safety of the capitalist world depends upon their
+getting together and dividing the plunder, the result is inevitable.
+
+The United States is a world Empire in her own right. She dominates the
+Western Hemisphere. Young and inexperienced, she nevertheless possesses
+the economic advantages and political authority that give her a voice in
+all international controversies. Only twenty years have passed since the
+organizing genius of America turned its attention from exclusively
+domestic problems to the problems of financial imperialism that have
+been agitating Europe for a half a century. The Great War showed that
+American men make good soldiers, and it also showed that American wealth
+commands world power.
+
+With the aid of Russia, France, Japan and the United States Great
+Britain crushed her most dangerous rival--Germany. The struggle which
+destroyed Germany's economic and military power erected in her stead a
+more menacing economic and military power--the United States. Untrained
+and inexperienced in world affairs, the master class of the United
+States has been placed suddenly in the title role. America over night
+has become a world empire and over night her rulers have been called
+upon to think and act like world emperors. Partly they succeeded, partly
+they bungled, but they learned much. Their appetites were whetted, their
+imaginations stirred by the vision of world authority. To-day they are
+talking and writing, to-morrow they will act--no longer as novices, but
+as masters of the ruling class in a nation which feels herself destined
+to rule the earth.
+
+The imperial struggle is to continue. The Japanese Empire dominates the
+Far East; the British Empire dominates Southern Asia, the Near East,
+Africa and Australia; the American Empire dominates the Western
+Hemisphere. It is impossible for these three great empires to remain in
+rivalry and at peace. Economic struggle is a form of war, and the
+economic struggle between them is now in progress.
+
+
+7. _Continuing the Imperial Struggle_
+
+The War of 1914 was no war for democracy in spite of the fact that
+millions of the men who died in the trenches believed that they were
+fighting for freedom. Rather it was a war to make the world safe for the
+British Empire. Only in part was the war successful. The old world was
+made safe by the elimination of Britain's two dangerous rivals--Germany
+and Russia; but out of the conflict emerged a new rival--unexpectedly
+strong, well equipped and eager for the conflict.
+
+The war did not destroy imperialism. It was fought between five great
+empires to determine which one should be supreme. In its result, it gave
+to Great Britain rather than to Germany the right to exploit the
+undeveloped portions of Asia and of Africa.
+
+The Peace--under the form of "mandates"--makes the process of
+exploitation easier and more legal than it ever has been in the past.
+The guarantees of territorial integrity, under the League Covenant, do
+more than has ever been done heretofore to preserve for the imperial
+masters of the earth their imperial prerogatives.
+
+New names are being used but it is the old struggle. Egypt and India
+helped to win the war, and by that very process, they fastened the
+shackles of servitude more firmly upon their own hands and feet. The
+imperialists of the world never had less intention than they have to-day
+of quitting the game of empire building. Quite the contrary--a wholly
+new group of empire builders has been quickened into life by the
+experiences of the past five years.
+
+The present struggle for the possession of the oil fields of the world
+is typical of the economic conflicts that are involved in imperial
+struggles. For years the capitalists of the great investing nations
+have been fighting to control the oil fields of Mexico. They have hired
+brigands, bought governors, corrupted executives. The war settled the
+Mexican question in favor of the United States. Mexico, considered
+internationally, is to-day a province of the American Empire.
+
+During the blackest days of the war, when Paris seemed doomed, the
+British divided their forces. One army was operating across the deserts
+of the Near East. For what purpose? When the Peace was signed, Great
+Britain held two vantage points--the oil fields of the Near East and the
+road from Berlin to Bagdad.
+
+The late war was not a war to end war, nor was it a war for disarmament.
+German militarism is not destroyed; the appropriations for military and
+naval purposes, made by the great nations during the last two years, are
+greater than they have ever been in any peace years that are known to
+history.
+
+The world is preparing for war to-day as actively as it was in the years
+preceding the War of 1914. The years from 1914 to 1918 were the opening
+episodes; the first engagements of the Great War.
+
+There is no question, among those who have taken the trouble to inform
+themselves, but that the War of 1914 was fought for economic and
+commercial advantage. The same rivalries that preceded 1914 are more
+active in the world to-day than ever before. Hence the possibilities of
+war are greater by exactly that amount. The imperial struggle is being
+continued and a part of the imperial struggle is war.
+
+
+8. _Again!_
+
+This monstrous thing called war will occur again! Not because any
+considerable number of people want it, not even because an active
+minority wills it, but because the present system of competitive
+capitalism makes war inevitable. Economic rivalries are the basis of
+modern wars and economic rivalries are the warp and woof of capitalism.
+
+To-day the rivalries are economic--in the fields of commerce and
+industry and finance. To-morrow they will be military.
+
+Already the nations have begun the competition in the building of tanks,
+battleships and airplanes. These instruments of destruction are built
+for use, and when the time comes, they will be used as they were between
+1914 and 1918.
+
+Again there will be the war propaganda--subtle at first, then more and
+more open. There will be stories of atrocities; threats of world
+conquest. "Preparedness" will be the cry.
+
+Again there will be the talk of "My country, right or wrong"; "Stand
+behind the President"; "Fall in line"; "Go over the top!"
+
+Again fear will stalk through the land, while hate and war lust are
+whipped into a frenzy.
+
+Again there will be conscription, and the straightest and strongest of
+the young men will leave their homes and join the colors.
+
+Again the most stalwart men of the nations will "dig themselves in" and
+slaughter one another for years on end.
+
+Again the truth-tellers will be mobbed and jailed and lynched, while
+those who champion the cause of the workers will be served with
+injunctions if they refuse to sell out to the masters.
+
+Again the profiteers will stop at home and reap their harvests out of
+the agony and the blood of the nation.
+
+Again, when the killing is over, a few old men, sitting around a table,
+will carve the world--stripping the vanquished while they reward the
+victors.
+
+Again the preparations will begin for the next war. The people will be
+fed on promises, phrases and lies. They will pay and they will die for
+the benefit of their masters, and thus the terrible tragedy of
+imperialism will continue to bathe the world in tears and in blood.
+
+
+
+
+XVIII. THE CHALLENGE TO IMPERIALISM
+
+
+1. _Revolutionary Protest_
+
+Since the Franco-Prussian War the people of Europe have been waking up
+to the failure of imperialism. The period has been marked by a rapid
+growth of Socialism on the continent and of trade-unionism in Great
+Britain. Both movements are expressions of an increasing working-class
+solidarity; both voice the sentiments of internationalism that were
+sounded so loudly during the revolutionary period of the eighteenth
+century.
+
+The rapid growth of the European labor movement worried the autocrats
+and imperialists. Bismarck suppressed it; the Russian police tortured
+it. Despite all of the efforts to check it or to crush it, the
+revolutionary movement in Europe gained force. The speeches and writings
+of the leaders were directed against the capitalist system, and the rank
+and file of the workers, rendered sharply class conscious by the
+traditions of class rule, responded to the appeal by organizing new
+forms of protest.
+
+The first revolutionary wave of the twentieth century broke in Russia in
+1905. The Russian Revolution of 1917 destroyed the old regime and
+replaced it first by a moderate or liberal and then by a radical
+communist control. Like all of the proletarian movements in Europe the
+Russian revolutionary movement was directed against "capitalism" and
+"imperialism" and despite the fact that there was no considerable
+development of the capitalist system in Russia, its imperial
+organization was so thoroughgoing, and the imperial attitude toward the
+working class had been so brutally revealed during the revolutionary
+demonstrations in 1905, that the people reacted with a true Slavic
+intensity against the despotism that they knew, which was that of an
+autocratic, feudal master-class.
+
+The international doctrines of the new Russian regime were expressed in
+the phrase "no forcible annexations, no punitive indemnities, the free
+development of all peoples." The keynote of its internal policy is
+contained in Section 16 of the Russian Constitution, which makes work
+the duty of every citizen of the Republic and proclaims as the motto of
+the new government the doctrine, "He that will not work neither shall he
+eat." The franchise is restricted. Only workers (including housekeepers)
+are permitted to vote. Profiteers and exploiters are specifically denied
+the right to vote or to hold office. Resources are nationalized together
+with the financial and industrial machinery of Russia. The Bill of
+Rights contained in the first section of the Russian Constitution is a
+pronouncement in favor of the liberty of the workers from every form of
+exploitation and economic oppression.
+
+The Russian revolution was directed against capitalism in Russia and
+against imperialism everywhere. This dramatic assault upon capitalist
+imperialism centered the eyes of the world upon Russia, making her
+experiment the outstanding feature of a period during which the workers
+were striving to realize the possibilities of a more abundant life for
+the masses of mankind.
+
+
+2. _Outlawing Bolshevism_
+
+Capitalist diplomats were wary of the Kerensky regime because they did
+not feel certain how far the Russian people intended to go. The triumph
+of the Bolsheviki made the issue unmistakably clear. There could be no
+peace between Bolshevism and capitalism. From that day forward it was a
+struggle to determine which of the two economic systems should survive.
+
+During the years 1918 and 1919 the capitalist world organized one of the
+most effective advertising campaigns that has ever been staged. Every
+shred of evidence that, by any stretch of the imagination, could be
+distorted into an attack upon the Bolshevist regime, was scattered
+broadcast over the world. Where evidence was lacking, rumor and
+innuendo were employed. The leading newspapers and magazines, prominent
+statesmen, educators, clergymen, scientists and public men in every walk
+of life went out of their way to denounce the Russian experiment in very
+much the same manner that the propertied interests of Europe had
+denounced the French experiment during the years that followed 1789.
+
+All of the great imperialist governments had at their disposal a vast
+machinery for the purveying of information--false or true as the case
+might demand. This public machinery like the machinery of private
+capitalism was turned against Bolshevism. The capitalist governments
+went farther by backing with money and supplies the counter
+revolutionary forces under Yudenich, Denekine, Seminoff, and Kolchak.
+Allied expeditions were landed on the soil of European and Asiatic
+Russia "to free the Russian people from the clutches of the Bolsheviki."
+A blockade was declared in which the Germans were invited to join (after
+the signing of the armistice), and the whole capitalist world united to
+starve into submission the men, women and children of revolutionary
+Russia.
+
+No event of recent times, not even the holy war against the autocracy of
+militarist Germany, had created such a unanimity of action among the
+Western nations. Bolshevism threatened the very existence of capitalism
+and as such its destruction became the first task of the capitalist
+world.
+
+The collapse of the capitalist efforts to destroy socialist Russia
+reflects the power of a new idea over the ancient form. The Allied
+expeditions into Russia met with hostility instead of welcome. The
+counter-revolutionary forces were overwhelmed by the red army. The
+buffer states made peace. The Allied soldiers mutinied when called upon
+to take part in a war against the forces of revolutionary Russia. "Holy
+Russia" became holy Russia indeed--recognized and respected by the
+proletarian forces throughout Europe.
+
+
+3. _The New Europe_
+
+Russia is the dramatic center of the European movement against
+capitalist imperialism, but the movement is not confined to Russia. Its
+activities are extended into every important country on the continent.
+
+Since March, 1917, when the first revolution occurred in Russia,
+absolute monarchy and divine, kingly rights have practically disappeared
+from Europe. Before the Russian Revolution, four-fifths of the people of
+Europe were under the sway of monarchs who exercised dictatorial power
+over the domestic and foreign affairs of their respective nations.
+Within two years, the Hohenzollerns, the Hapsburgs and the Romanoffs
+were driven from the thrones of Germany, of Austria and of Russia. Other
+rulers of lesser importance followed in their wake, until to-day, the
+old feudal power that held the political control over most of Europe in
+1914 has practically disappeared.
+
+This is the obvious thing--a revolution in the form of political
+government--the kind of revolution with which history usually deals.
+
+But there is another revolution proceeding in Europe, far more important
+because more fundamental--the economic and social revolution; the change
+in the form of breadwinning; the change in the relation between a man
+and the tools that he uses to earn his livelihood.
+
+Every one knows, now, that Czars and Kaisers and Emperors did not really
+control Europe before 1914, except in so far as they yielded to bankers
+and to business men. The crown and the scepter gave the appearance of
+power, but behind them were concessions, monopolies, economic
+preferments, and special privilege. The European revolution that began
+in 1917 with the Czar, did not stop with kings. It began with them
+because they were in such plain sight, but when it had finished with
+them it went right on to the bankers and the business men.
+
+War is destruction, organized and directed by the best brains
+available. It is merry sport for the organizers and for some of the
+directors, but like any other destructive agent, it may get out of hand.
+The War of 1914 was to last for six weeks. It dragged on for five years,
+and the wars that have grown out of it are still continuing. In the
+course of those five years, the war destroyed the capitalist system of
+continental Europe. Patches and shreds of it remained, but they were
+like the topless, shattered trees on the scarred battle-fields. They
+were remnants--nothing more. In the first place, the war destroyed the
+confidence of the people in the capitalist system; in the second place,
+it smashed up the political machinery of capitalism; in the third place,
+it weakened or destroyed the economic machinery of capitalism.
+
+Each government, to win the war, lied to its people. They were told that
+their country was invaded. They were assured that the war would be a
+short affair. Besides that, there were various reasons given for the
+struggle--it was a war to end war; it was a war to break the iron ring
+that was crushing a people; it was a war for liberty; it was a struggle
+to make the world safe for democracy.
+
+Not a single important promise of the war was fulfilled, save only the
+promise of victory. Hundreds of millions, aroused to the heights of an
+exalted idealism, came back to earth only to find themselves betrayed.
+With less promise and more fulfillment; with at least an appearance of
+statesmanship; with some respect for the simple moralities of
+truth-telling, fair-dealing, and common honor, there might have been
+some chance for the capitalist system to retain the confidence of the
+peoples of war-torn Europe, even in the face of the Russian Revolution;
+but each of these things was lacking, and as one worker put it: "I don't
+know what Bolshevism is, but it couldn't be any worse than what we have
+now, so I'm for it!"
+
+Such a loss of public confidence would have proved a serious blow to any
+social system, even were it capable of immediately reestablishing normal
+conditions of living among the people. In this case, the same events
+that destroyed public confidence in the capitalist system, destroyed the
+system itself.
+
+The old political forms of Europe--the czars, emperors and kaisers, who
+stood as the visible symbols of established order and civilization, were
+overthrown during the war. The economic forces--the banks and business
+men--had used these forms for the promotion of their business
+enterprises. Capitalism depended on czars and kaisers as a blacksmith
+depends on his hammer. They were among the tools with which business
+forged the chains of its power. They were the political side of the
+capitalist system. While the people accepted them and believed in them,
+the business interests were able to use these political tools at will.
+The tools were destroyed in the fierce pressure of war and revolution,
+and with them went one of the chief assets of the European capitalists.
+
+There was a third breakdown--far more important than the break in the
+political machinery of the capitalist system--and that was the
+annihilation of the old economic life.
+
+Economic life is, in its elements, very simple. Raw materials--iron ore,
+copper, cotton, petroleum, coal and wheat--are converted, by some
+process of labor, into things that feed, clothe and house people. There
+are four stages in this process--raw materials; manufacturing;
+transportation; marketing. If there is a failure in one of the four, all
+of the rest go wrong, as is very clearly illustrated whenever there is a
+great miners' or railroad workers' strike, or when there is a failure of
+a particular crop. During the war, all four of these economic stages
+went wrong.
+
+Between the years 1914 and 1918 the people of Europe busied themselves
+with a war that put their economic machine out of the running.
+
+For a hundred years the European nations had been busy building a finely
+adjusted economic mechanism; population, finance, commerce--all were
+knit into the same system. This system the war demolished, and the years
+that have followed the Armistice have not seen it rebuilt in any
+essential particular, save in Great Britain and in some of the neutral
+countries.
+
+Not only were the European nations unable to give commodities in
+exchange for the things they needed but the machinery of finance, by
+means of which these transactions were formerly facilitated, was
+crippled almost beyond repair. Under the old system buying and selling
+were carried on by the use of money, and money ceased to be a stable
+medium of exchange in Europe. It would be more correct to say that money
+was no longer taken seriously in many parts of Europe. During the war
+the European governments printed 75 billions of dollars' worth of paper
+money. This paper depreciated to a ridiculous extent. Before the war,
+the franc, the lira, the mark and the crown had about the same value--20
+to 23 cents, or about five to a dollar. By 1920 the dollar bought 15
+francs; 23 liras; 40 marks, and 250 Austrian crowns. In some of the
+ready-made countries, constituted under the Treaty or set up by the
+Allies as a cordon about Russia, hundreds and thousands of crowns could
+be had for a dollar. Even the pound sterling, which kept its value
+better than the money of any of the other European combatants, was
+thirty per cent. below par, when measured in terms of dollars. This
+situation made it impossible for the nations whose money was at such a
+heavy discount to purchase supplies from the more fortunate countries.
+But to make matters even worse, the rate of exchange fluctuated from day
+to day and from hour to hour so that business transactions could only be
+negotiated on an immense margin of safety.
+
+Add to this financial dissolution the mountains of debt, the huge
+interest charges and the oppressive taxes, and the picture of economic
+ruin is complete.
+
+The old capitalist world, organized on the theory of competition between
+the business men within each nation, and between the business men of one
+nation and those of another nation, reached a point where it would no
+longer work.
+
+In Russia the old system had disappeared, and a new system had been set
+up in its place. In Germany, and throughout central Europe, the old
+system was shattered, and the new had not yet emerged. In France, Italy
+and Great Britain the old system was in process of disintegration--rapid
+in France and Italy; slower in Great Britain. But in all of these
+countries intelligent men and women were asking the only question that
+statesmanship could ask--the question, "What next?"
+
+The capitalist system was stronger in Great Britain than in any of the
+other warring countries of Europe. Before the war, it rested on a surer
+foundation. During the war, it withstood better than any other the
+financial and industrial demands. Since the war, it has made the best
+recovery.
+
+Great Britain is the most successful of the capitalist states. The other
+capitalist nations of Europe regard her as the inner citadel of European
+capitalism. The British Labor Movement is seeking to take this citadel
+from within.
+
+The British Labor Movement is a formidable affair. There are not more
+than a hundred thousand members in all of the Socialist parties, in the
+Independent Labor Party and in the Communist Party combined. There are
+between six and seven millions of members in the trade unions.
+
+Perhaps the best test of the strength of the British Labor Movement came
+in the summer of 1920, over the prospective war with Russia. Warsaw was
+threatened. Its fall seemed imminent, and both Millerand and
+Lloyd-George made it clear that the fall of Warsaw meant war. The
+situation developed with extraordinary rapidity. It was reported that
+the British Government had dispatched an ultimatum. The Labor Movement
+acted with a strength and precision that swept the Government off its
+feet and compelled an immediate reversal of policy.
+
+Over night, the workers of Great Britain were united in the Council of
+Action. As originally constituted, the "Labor and Russia Council of
+Action" consisted of five representatives each from the Parliamentary
+Committee of the Trades Union Congress, the Executive Committee of the
+Labor Party and the Parliamentary Labor Party. To these fifteen were
+added eight others, among whom were representatives of every element in
+the British Labor Movement. This Council of Action did three things--it
+notified the Government that there must be no war with Russia; it
+organized meetings and demonstrations in every corner of the United
+Kingdom to formulate public opinion; it began the organization of local
+councils of action, of which there were three hundred within four weeks.
+The Council of Action also called a special conference of the British
+Labor Movement which met in London on August 13. There were over a
+thousand delegates at this conference, which opened and closed with the
+singing of the "Internationale." When the principal resolution of
+endorsement was passed, approving the formation of the Council of
+Action, the delegates rose to their feet, cheered the move to the echo,
+and sang the "Internationale" and "The Red Flag." The closing resolution
+authorized the Council of Action to take "any steps that may be
+necessary to give effect to the decisions of the Conference and the
+declared policy of the Trade Union and Labor Movement."
+
+Such was the position in the "Citadel of European Capitalism." The
+Government was forced to deal with a body that, for all practical
+purposes, was determining the foreign policy of the Empire. Behind that
+Council was an organized group of between six and seven millions of
+workers who were out to get the control of industry into their own
+hands, and to do it as speedily and as effectually as circumstances
+would permit.
+
+Meanwhile, the mantle of revolutionary activity descended upon Italy,
+where the red flag was run up over some the largest factories and some
+of the finest estates.
+
+Throughout the war, the revolutionary movement was strong in Italy. The
+Socialist Party remained consistently an anti-war party, with a radical
+and vigorous propaganda. The Armistice found the Socialist and Labor
+Movements strong in the North, with a growing movement in the South for
+the organization of Agricultural Leagues.
+
+The Socialist propaganda in Italy was very consistent and telling. The
+paper "Avanti," circulating in all parts of the country, was an agency
+of immense importance. The war, the Treaty, the rising cost of living,
+the growing taxation--all had prepared the ground for the work that the
+propagandists were doing. Their message was: "Make ready for the taking
+over of the industries! Learn what you can, so that, when the day comes,
+each will play his part. When you get the word, take over the works!
+There must be no violence--that only helps the other side. Do not linger
+on the streets, you will be shot. Remain at home or stay in the
+factories and work as you never worked before!"
+
+That, in essence, was the Italian Socialist propaganda--simple, clear
+and direct, and that was, in effect, what the workers did.
+
+The returned soldiers were a factor of large importance in the Italian
+Revolution. They were radicals throughout the war. The peace made them
+revolutionists. "The Proletarian League of the Great War" was affiliated
+with "The International of Former Soldiers," which comprised the radical
+elements among the ex-service men of Great Britain, Germany, France,
+Austria, Italy and a number of the smaller countries. There were over a
+million dues-paying members in this International, and their avowed
+object was propaganda against war and in favor of an economic system in
+which the workers control the industries. It was this group in
+Italy--particularly in the South--that carried through the project of
+occupying the estates.
+
+The workers are in control of the whole social fabric in Russia where
+the revolution has gone the farthest. In Great Britain, where the labor
+movement is perhaps more conservative than in any of the other countries
+of Europe, the Government is compelled to deal with a labor movement
+that is strong enough to consider and to decide important matters of
+foreign policy. The workers of Italy have the upper hand. In
+Czecho-Slovakia, in Bulgaria, in Germany and in the smaller and neutral
+countries the workers are making their voices heard in opposition to any
+restoration of the capitalist system; while they busy themselves with
+the task of creating the framework of a new society.
+
+
+4. _The Challenge_
+
+This is the challenge of the workers of Europe to the capitalist system.
+The workers are not satisfied; they are questioning. They mean to have
+the best that life has to give, and they are convinced that the
+capitalist system has denied it to them.
+
+The world has had more than a century of capitalism. The workers have
+had ample opportunity to see the system at work. The people of all the
+great capitalist countries--the common people--have borne the burdens
+and felt the crushing weight of capitalism--in its enslavement of little
+children; in its underpaying of women; in long hours of unremitting,
+monotonous toil; in the dreadful housing; in the starvation wages; in
+unemployment; in misery. The capitalist system has had a trial and it is
+upon the workers that the system has been tried out.
+
+During this experiment, the workers of the world have been compelled to
+accept poverty, unemployment and war.
+
+These terrible scourges have afflicted the capitalist world, and it is
+the workers and their families that have borne them in their own
+persons. In those countries where the capitalist system is the oldest,
+the workers have suffered the longest. The essence of capitalism is the
+exploitation of one man by another man, and the longer this exploitation
+is practiced the more skillful and effective does the master class
+become in its manipulation.
+
+The workers look before them along the path of capitalist imperialism
+that is now being followed by the nations that are in the lead of the
+capitalist world. There they see no promise save the same exploitation,
+the same poverty, the same inequality and the same wars over the
+commercial rivalries of the imperial nations.
+
+The workers of Europe have come to the conclusion that the world should
+belong to those who build it; that the good things of life should be the
+property of those who produce them. They see only one course open before
+them--to declare that those who will not work, shall not eat.
+
+The right of self-determination is the international expression of this
+challenge. The ownership of the job is its industrial equivalent.
+Together, the two ideas comprise the program of the more advanced
+workers in all of the great imperial countries of the world. These ideas
+did not originate in Russia, and they are not confined to Russia any
+more than capitalism is confined to Great Britain. They are the
+doctrines of the new order that is coming rapidly into its own.
+
+Capitalism has been summed up, heretofore, in the one word "profit." The
+capitalist cannot abandon that standard. The world has lived beyond it,
+however, and without it, capitalism, as a system, is meaningless. If the
+capitalists abandon profit, they abandon capitalism.
+
+Without profit the capitalist system falls to pieces, because it is the
+profit incentive that has always been considered as the binder that
+holds the capitalist world together. Hence the abandonment of the profit
+incentive is the surrender of the citadel of capitalism. While profit
+remains, exploitation persists, and while there is exploitation of one
+man by another, no human being can call himself free.
+
+The capitalists are caught in a beleaguered fortress in which they are
+defending their economic lives. Profit is the key to this fortress, and
+if they surrender the key, they are lost.
+
+
+5. _The Real Struggle_
+
+This is the real struggle for the possession of the earth. Shall the few
+own and the many labor for the few, or the many own, and labor upon jobs
+that they themselves possess? The struggle between the capitalist
+nations is incidental. The struggle between the owners of the world and
+the workers of the world is fundamental.
+
+If Great Britain wins in her conflict with the United States, her
+capitalists will continue to exploit the workers of Lancashire and
+Delhi. Her imperialists will continue their policy of world domination,
+subjugating peoples and utilizing their resources and their labor for
+the enrichment.
+
+If the United States wins in her struggle with Great of the bankers and
+traders of London. Britain, her capitalists will continue to exploit the
+workers of Pittsburg and San Juan. Her imperialists will continue their
+policy of world domination, subjugating the peoples of Latin American
+first, and then reaching out for the control over other parts of the
+earth.
+
+No matter what imperial nation may triumph in this struggle between the
+great nations for the right to exploit the weaker peoples and the choice
+resources, the struggle between capitalism and Socialism must be fought
+to a finish. If the capitalists win, the world will see the introduction
+of a new form of serfdom, more complete and more effective than the
+serfdom of Feudal Europe. If the Socialists win, the world enters upon a
+new cycle of development.
+
+
+
+
+XIX. THE AMERICAN WORKER AND WORLD EMPIRE
+
+
+1. _Gains and Losses_
+
+The American worker is a citizen of the richest country of the world.
+Resources are abundant. There is ample machinery to convert these gifts
+of nature into the things that men need for their food and clothing,
+their shelter, their education and their recreation. There is enough for
+all, and to spare, in the United States.
+
+But the American worker is not master of his own destinies. He must go
+to the owners of American capital--to the plutocrats--and from them he
+must secure the permission to earn a living; he must get a job.
+Therefore it is the capitalists and not the workers of the United States
+that are deciding its public policy at the present moment.
+
+The American capitalist is a member of one of the most powerful
+exploiting groups in the world. Behind him are the resources, productive
+machinery and surplus of the American Empire. Before him are the
+undeveloped resources of the backward countries. He has gained wealth
+and power by exploitation at home. He is destined to grow still richer
+and more powerful as he extends his organization for the purposes of
+exploitation abroad.
+
+The prospects of world empire are as alluring to the American capitalist
+as have been similar prospects to other exploiting classes throughout
+history. Empire has always been meat and drink to the rulers.
+
+The master class has much to gain through imperialism. The workers have
+even more to lose.
+
+The workers make up the great bulk of the American people. Fully
+seven-eighths (perhaps nine-tenths) of the adult inhabitants of the
+United States are wage earners, clerks and working farmers. All of the
+proprietors, officials, managers, directors, merchants (big and little),
+lawyers, doctors, preachers, teachers, and the remainder of the business
+and professional classes constitute not over 10 or 12 percent of the
+total adult population. The workers are the "plain people" who do not
+build empires any more than they make wars. If they were left to
+themselves, they would continue the pursuit of their daily affairs which
+takes most of their thought and energy--and be content to let their
+neighbors alone.
+
+
+2. _The Workers' Business_
+
+The mere fact that the workers are so busy with the routine of daily
+life is in itself a guarantee that they will mind their own business.
+The average worker is engaged, outside of working hours, with the duties
+of a family. His wife, if she has children, is thus employed for the
+greater portion of her time. Both are far too preoccupied to interfere
+with the like acts of other workers in some other portion of the world.
+Furthermore, their preoccupation with these necessary tasks gives them
+sympathy with those similarly at work elsewhere.
+
+The plain people of any country are ready to exercise even more than an
+ordinary amount of forbearance and patience rather than to be involved
+in warfare, which wipes out in a fortnight the advantages gained through
+years of patient industry.
+
+The workers have no more to gain from empire building than they have
+from war making, but they pay the price of both. Empire building and war
+making are Siamese twins. They are so intimately bound together that
+they cannot live apart. The empire builder--engaged in conquering and
+appropriating territory and in subjugating peoples--must have not only
+the force necessary to set up the empire, but also the force requisite
+to maintain it. Battleships and army corps are as essential to empires
+as mortar is to a brick wall. They are the expression of the organized
+might by which the empire is held together.
+
+The plain people are the bricks which the imperial class uses to build
+into a wall about the empire. They are the mortar also, for they man the
+ships and fill up the gaps in the infantry ranks and the losses in the
+machine gun corps. They are the body of the empire as the rulers are its
+guiding spirit.
+
+When ships are required to carry the surplus wealth of the ruling class
+into foreign markets, the workers build them. When surplus is needed to
+be utilized in taking advantage of some particularly attractive
+investment opportunity the workers create it. They lay down the keels of
+the fighting ships, and their sons aim and fire the guns. They are
+drafted into the army in time of war and their bodies are fed to the
+cannon which other workers in other countries, or perhaps in the same
+country, have made for just such purposes. The workers are the warp and
+woof of empire, yet they are not the gainers by it. Quite the contrary,
+they are merely the means by which their masters extend their dominion
+over other workers who have not yet been scientifically exploited.
+
+The work of empire building falls to the lot of the workers. The profits
+of empire building go to the exploiting class.
+
+
+3. _The British Workers_
+
+What advantage came to the workers of Rome from the Empire which their
+hands shaped and which their blood cemented together? Their masters took
+their farms, converted the small fields into great, slave-worked
+estates, and drove the husbandmen into the alleys and tenements of the
+city where they might eke out an existence as best they could. The
+rank-and-file Roman derived the same advantage from the Roman Empire
+that the rank-and-file Briton has derived from the British Empire.
+
+Great Britain has exercised more world mastery during the past hundred
+years than any other nation. All that Germany hoped to achieve Great
+Britain has realized. Her traders carry the world's commerce, her
+financiers clip profits from international business transactions, her
+manufacturers sell to the people of every country, the sun never sets on
+the British flag.
+
+Great Britain is the foremost exponent and practitioner of capitalist
+imperialism. The British Empire is the greatest that the world has known
+since the Empire of Rome fell to pieces. Whatever benefits modern
+imperialism brings either for capitalists or for workers should be
+enjoyed by the capitalists and workers of Great Britain.
+
+Until the Great World War the capitalists of Great Britain were the most
+powerful on earth with a larger foreign trade and a larger foreign
+investment than any other. At the same time the British workers were
+amongst the worst exploited of those in any capitalist country in
+Europe.
+
+The entire nineteenth century is one long and terrible record of
+master-class exploitation inside the British Isles. The miseries of
+modern India have been paralleled in the lives of the workers of
+Ireland, Scotland, Wales and England. Gibbins, in his description of the
+conditions of the child workers in the early years of the nineteenth
+century ends with the remark, "One dares not trust oneself to try and
+set down calmly all that might be told of this awful page of the history
+of industrial England."[58]
+
+Even more revolting are the descriptions of the conditions which
+surrounded the lives of the mine workers in the early part of the
+nineteenth century. Women as well as men were taken into the mines and
+in some cases, as the reports of the Parliamentary investigation show,
+the women dragged cars through passage-ways that were too low to admit
+the use of ponies or mules.
+
+England, mistress of the seas, proud carrier of the traffic of the
+world, the center of international finance, the richest among all the
+investing nations--England was reeking with poverty. Beside her
+factories and warehouses were vile slums in which people huddled as
+Ruskin said, "so many brace to a garret." There in the back alleys of
+civilization babies were born and babies died, while those who survived
+grew to the impotent manhood of the street hooligan.
+
+The British Empire girdled the world. For a century its power had grown,
+practically unchallenged. Superficially it had every appearance of
+strength and permanence but behind it and beneath it were the hundreds
+of thousands of exploited factory workers, the underpaid miners, the
+Cannon Gate of Edinburgh and the Waterloo Junction of London.
+
+Capitalist imperialism has not benefited the British workers. Quite the
+contrary, the rise of the Empire has been accompanied by the
+disappearance of the stalwart English yeoman; by the disappearance of
+the agricultural population; by the concentration of the people in huge
+industrial towns where the workers, no longer the masters of their own
+destinies, must earn their living by working at machines owned by the
+capitalist imperialists. The surplus derived from this exploited labor
+is utilized by the capitalists as the means of further extending their
+power in foreign lands.
+
+Imperialism has brought not prosperity, but poverty to the plain people
+of England.
+
+There is another aspect of the matter. If these degraded conditions
+attach to the workers in the center of the empire, what must be the
+situation among the workers in the dependencies that are the objects of
+imperial exploitation? Let the workers of India answer for Great
+Britain; the workers of Korea answer for Japan, and the workers of Porto
+Rico answer for the United States. Their lot is worse than is the lot of
+the workers at the center of imperial power.
+
+Empires yield profits to the masters and victory and glory to the
+workers. Let any one who does not believe this compare the lives of the
+workers in small countries like Holland, Norway, Denmark and
+Switzerland, with the lives of the workers in the neighboring
+empires--Russia, Germany, France and Great Britain. The advantage is all
+on the side of those who live in the smaller countries that are minding
+their own affairs and letting their neighbors alone.
+
+
+4. _The Long Trail_
+
+The workers of the United States are to-day following the lead of the
+most powerful group of financial imperialists in the world. The trail is
+a long one leading to world conquest, unimagined dizzying heights of
+world power, riches beyond the ken of the present generation, and then,
+the slow and terrible decay and dissolution that sooner or later
+overtake those peoples that follow the paths of empire. The rulers will
+wield the power and enjoy the riches. The people will struggle and
+suffer and pay the price.
+
+The American plutocracy is out to conquer the earth because it is to
+their interest to do so. The will-o'-the-wisp of world empire has
+captured their imaginations and they are following it blindly.
+
+The American people, on November 2, 1920, gave the American imperialists
+a blanket authority to go about their imperial business--an authority
+that the rulers will not be slow to follow. First they will clean house
+at home--that housecleaning will be called "the campaign for the
+establishment of the open shop." Then they will go into Mexico, Central
+America, China, and Europe in search of markets, trade and investment
+opportunities.
+
+Behind the investment will come the flag, carried by battle-ships and
+army divisions. That flag will be brought front to front with other
+flags, high words will be spoken, blood will flow, life will ebb, and
+the imperialists will win their point and pocket their profit.
+
+Behind them, in November, and at all other times of the year, there
+will be the will, expressed or implied, of the working people of the
+United States, who will produce the surplus for foreign investment; will
+make the ships and man them; will dig the coal and bore for the oil;
+will shape the machines. Their hands and the hands of their sons will be
+the force upon which the ruling class must depend for its power. They
+will produce, while the ruling class consumes and destroys.
+
+The trail is a long one, but it leads none the less certainly to,
+isolation and death. No people can follow the imperial trail and live.
+Their liberties go first and then their lives pay the penalty of their
+rulers' imperial ambition. It was so in the German Empire. It is so
+to-day in the British Empire. To-morrow, if the present course is
+followed, it will be equally true in the American Empire.
+
+
+5. _The New Germany_
+
+One of the chief charges against the Germans, in 1914, was that they
+were not willing to leave their neighbors in peace. They were out to
+conquer the world, and they did not care who knew it. It was not the
+German people who held these plans for world conquest, it was the German
+ruling class. The German people were quite willing to stay at home and
+attend to their own affairs. Their rulers, pushed by the need for
+markets and investment opportunities, and lured by the possibilities of
+a world empire, were willing to stake the lives and the happiness of the
+whole nation on the outcome of these ambitious schemes. They threw their
+dice in the great world game of international rivalries--threw and lost;
+but in their losing, they carried not only their own fortunes, but the
+lives and the homes and the happiness of millions of their fellows whose
+only desire was to remain at home and at peace.
+
+Germany's offense was her ambition to gain at the expense of her
+neighbors. Lacking a place in the sun, she proposed to take it by the
+strength of her good right arm. This is the method by which all of the
+great empires have been built and it is the method that the builders of
+the American Empire have followed up to this point. The land which the
+ruling class of the United States has needed has heretofore been in the
+hands of weak peoples--Indians, Mexicans, a broken Spanish Empire. Now,
+however, the time has come when the rulers of the United States, with
+the greatest wealth and the greatest available resources of any of the
+nations, are preparing to take what they want from the great nations,
+and that imperial purpose can be enforced in only one way--by a resort
+to arms. The rulers of the United States must take what they would have
+by force, from those who now possess it. They did not hesitate to take
+Panama from Colombia; they did not hesitate to take possession of Hayti
+and of Santo Domingo, and they do not propose to stop there.
+
+The people of the world know these things. The inhabitants of Latin
+America know them by bitter experience. The inhabitants of Europe and of
+Asia know them by hearsay. Both in the West and in the East, the United
+States is known as "The New Germany."
+
+That means that the peoples of these countries look upon the United
+States and her foreign policies in exactly the same way that the people
+of the United States were taught to regard Germany and her foreign
+policies. To them the United States is a great, rich, brutal Empire,
+setting her heel and laying her fist where necessity calls. Men and
+women inside the United States think of themselves and of their fellow
+citizens as human beings. The people in the other countries read the
+records of the lynchings, the robberies and the murders inside the
+United States; of the imperial aggression toward Latin America, and they
+are learning to believe that the United States is made up of ruthless
+conquerors who work their will on those that cross their path.
+
+The plain American men and women, living quietly in their simple homes,
+are none the less citizens of an aggressive, conquering Empire. They may
+not have a thought directed against the well-being of a single human
+creature, but they pay their taxes into the public treasury; they vote
+for imperialism on each election day; they read imperialism in their
+papers and hear it preached in their churches, and when the call comes,
+their sons will go to the front and shed their blood in the interest of
+the imperial class.
+
+The plain people of the German Empire did not desire to harm their
+fellows, nevertheless, they furnished the cannon-fodder for the Great
+War. America's plain folks, by merely following the doctrine, "My
+country, right or wrong--America first!" will find themselves, at no
+very distant date, exactly where the German people found themselves in
+1914.
+
+
+6. _The Price_
+
+The historic record, in the matter of empire, is uniform. The masters
+gain; the workers pay.
+
+The workers of the United States will not be exempt from these
+inexorable necessities of imperialism. On the contrary they will be
+called upon to pay the same price for empire that the workers in Britain
+have paid; that the workers in the other empires have paid. What is the
+price? What will world empire cost the American workers?
+
+1. It will cost them their liberties. An empire cannot be run by a
+debating society. Empires must act. In order to make this action mobile
+and efficacious, authority must be centered in the hands of a small
+group--the ruling class, whose will shall determine imperial policy.
+Self-government is inconsistent with imperialism.
+
+2. The workers will not only lose their own liberties, but they will be
+compelled to take liberties away from the peoples that are brought under
+the domination of the Empire. Self-determination is the direct opposite
+of imperialism.
+
+3. The American workers, as a part of the price of empire, will be
+compelled to produce surplus wealth--wealth which they can never
+consume; wealth the control of which passes into the hands of the
+imperial ruling class, to be invested by them in the organization of the
+Empire and the exploitation of the resources and other economic
+opportunities of the dependent territory.
+
+4. The American workers must be prepared to create and maintain an
+imperial class, whose function it is to determine the policies and
+direct the activities of the Empire. This class owes its existence to
+the existence of empire, without which such a ruling class would be
+wholly unnecessary.
+
+5. The American workers must be prepared, in peace time as well as in
+war time, to provide the "sinews of war": the fortifications, the battle
+fleet, the standing army and the vast naval and military equipment that
+invariably accompany empire.
+
+6. The American workers must furthermore be ready, at a moment's call,
+to turn from their occupations, drop their useful pursuits, accept
+service in the army or in the navy and fight for the preservation of the
+Empire--against those who attack from without, against those who seek
+the right of self-determination within.
+
+7. The American workers, in return for these sacrifices, must be
+prepared to accept the poverty of a subsistence wage; to give the best
+of their energies in war and in peace, and to stand aside while the
+imperial class enjoys the fat of the land.
+
+
+7. _A Way Out_
+
+If the United States follows the course of empire, the workers of the
+United States have no choice but to pay the price of Empire--pay it in
+wealth, in misery, and in blood. But there is an alternative. Instead of
+going on with the old system of the masters, the workers may establish a
+new economic system--a system belonging to the workers, and managed by
+them for their benefit.
+
+The workers of Europe have tried out imperialism and they have come to
+the conclusion that the cost is too high. Now they are seeking, through
+their own movement--the labor movement--to control and direct the
+economic life of Europe in the interest of those who produce the wealth
+and thus make the economic life of Europe possible.
+
+The American workers have the same opportunity. Will they avail
+themselves of it? The choice is in their hands.
+
+Thus far the workers of the United States have been, for the most part,
+content to live under the old system, so long as it paid them a living
+wage and offered them a job. The European workers felt that too in the
+pre-war days, but they have been compelled--by the terrible experiences
+of the past few years--to change their minds. It was no longer a
+question of wages or a job in Europe. It was a question of life or
+death.
+
+Can the American worker profit by that experience? Can he realize that
+he is living in a country whose rulers have adopted an imperial policy
+that threatens the peace of the world? Can he see that the pursuit of
+this policy means war, famine, disease, misery and death to millions in
+other countries as well as to the millions at home? The workers of
+Europe have learned the lesson by bitter experience. Is not the American
+worker wise enough to profit by their example?
+
+FOOTNOTE:
+
+[58] "Industry in England," H. deB. Gibbins. New York, Scribner's, 1897,
+p. 390.
+
+THE END
+
+
+
+
+INDEX.
+
+
+Advertising imperialism, 169
+
+America, conquest of, 27
+
+America first, 170
+
+America for Americans, 202
+
+American capitalists, 218
+   "          "       program of, 226
+   "     empire, costs of, 160
+   "        "    course of, 158
+   "        "    development of, 15
+   "        "    economic basis of, 74
+   "        "    growth of, 161
+   "     imperialism, 23
+   "     Indian, 29
+   "     industries, growth of, 178
+   "     people, ancestry, 159
+   "     protectorates, 207
+   "     Republic, disappearance of, 72
+   "     tradition, failure of, 12
+   "     worker and empire, 256
+
+Anti-imperialism, 68
+
+Appropriation of territory, 213
+
+Automobile distribution, 183
+
+
+Bankers, unity of, 150
+
+Bethlehem Steel Co., 132
+
+British Empire, gains of, 198
+   "       "    position of, 234
+   "    Labor, position of, 250
+
+Business control, 148
+
+
+Canada, investments in, 206
+
+Capitalism and Bolshevism, 244
+    "       "  war, 225
+    "      breakdown of, 248
+    "      law of, 223
+
+Cherokees, dealings with, 33
+
+Class government, 10
+  "   struggle, in Europe, 254
+
+Coal reserves, 180
+
+Cohesion of wealth, 86, 118
+
+Competition, ferocity of, 223
+
+Competitive industry, 75
+
+Conquering peoples, 26
+
+Conquest of the West, 49
+
+Council of Action, organization, 250
+   "    "  National Defense, 148
+
+Cuban independence, 66
+  "    treaty, 208
+
+
+Dictatorship, possibility of, 222
+
+Dominican Republic, relations with, 209
+
+
+Education for imperialism, 169
+
+Empire and British workers, 258
+  "    characteristics of, 15
+  "    definition of, 16
+  "    evolution of, 22
+  "    prevalence of, 17
+  "    price of, 20, 264
+  "    stages in, 19
+  "    workers and, 262
+
+Empires, the Big Four, 231
+
+Europe, financial breakdown, 249
+  "     revolution in, 246
+
+
+Financial imperialism, 135
+
+Foreign investments, 131
+
+France, gains of, 197
+
+
+Government and business, 99
+
+Great Peace, 36
+
+Great War, 143
+  "    "   advantages of, to the United States, 157
+  "    "   next incidents of, 235
+  "    "   results of, 240
+
+Guaranty Trust Company, 136
+
+
+Hawaii, annexation of, 62
+  "     revolution in, 63
+
+Hayti, conditions in, 210
+
+
+Immigrants, race of, 160
+
+Imperial alignment, 229
+    "    goal, 222
+    "    purpose, 165
+    "    sentiments, 166
+    "    task, 237
+    "      "   nature of, 228
+
+Imperialism, advantages of, 256
+     "       beginnings of, 65
+     "       challenge to, 243
+     "       cost of, 261
+     "       establishment of, 72
+     "       failure of, 243
+     "       psychology of, 170
+
+Imperialists, training of, 219
+
+Incomes, in the United States, 115
+
+Industrial combination, 81
+     "     organization, 78
+     "     revolution, 76
+
+International exploitation, 128
+      "       finance, 135
+      "       Harvester Co., 133
+
+Investing nations, 127
+
+Investment bankers, 86
+
+Investments in the United States, 130
+
+Italy, gains of, 197
+
+
+Job ownership, 94
+
+
+Labor, colonial shortage of, 38
+
+Landlordism, 105
+
+Land ownership, 103
+  "  policy, 104
+
+Latin America, 203
+
+Liberty, desire for, 8
+
+
+Manifest destiny, 171
+
+Mastery, avenues of, 92
+
+Mexican War, provocation of, 55
+   "     "   success of, 56
+
+Mexico, conquest of, 54
+
+Monroe Doctrine, 202
+   "       "     logic of, 207
+
+
+National City Bank, 138
+
+Navy League, 146
+
+Negro civilization, in Africa, 40
+  "   slaves, values of, 47
+
+Negroes, numbers enslaved, 43
+
+New Europe, 246
+
+Next War, contestants in, 236
+  "   "   preparations for, 241
+  "   "   pretexts for, 238
+
+New Orleans, struggle for, 50
+
+
+Ownership, advantages of, 114
+
+
+Panama, relations with, 213
+  "     revolution in, 215
+  "     seizure of, 214
+
+Patriotism, 147
+
+Peace Treaty, provisions of, 224
+  "      "    results of, 194
+
+Personal incomes, sources of, 116
+
+Philippines, conquest of, 69
+
+Plutocracy, 117
+     "      control of, 148
+     "      dictatorship of, 92
+     "      domestic power of, 153
+     "      economic gains of, 151
+     "      growing power of, 143
+
+Popular government, 9
+
+Population, increase of, 50
+
+Preparedness, 145
+
+Press censorship, 210
+
+Product ownership, 96
+
+Profiteering, 151
+
+Property, Indian ideas of, 30
+    "     ownership, security of, 107
+    "     rights, and civilization, 113
+    "     rights of, 103
+    "     safeguards to, 108
+
+Public opinion, control of, 98
+
+
+Resources of the United States, 179
+
+Revolution in Europe, 246
+
+Russia, Allied attack on, 245
+   "    world position of, 231
+
+
+Slave Coast, 39
+  "   power, defeat of, 61
+  "   trade, America's part in, 44
+  "     "    beginnings of, 39
+  "     "    conditions of, 43
+  "     "    development of, 42
+
+Slavery, and expansion, 60
+   "     beginnings of, 39
+   "     in the United States, 45
+
+Slaves, early demand for, 41
+
+Southwest, conquest of, 51, 57
+
+Sovereignty, source of, 11
+
+Spanish War, 65
+
+Standard Oil Co., 134
+
+Surplus, disposal of, 123
+   "     pressure of, 121
+
+
+Teutonic peoples, 26
+
+Texas, annexation of, 52
+
+Timber reserves, 180
+
+Transportation facilities, 183
+
+
+Undeveloped countries, 124
+
+United States, capital of, 181
+  "       "    financial power of, 154
+  "       "    past isolation, 192
+  "       "    position of, 221
+  "       "    products of, 184
+  "       "    resources of, 179
+  "       "    shipping, 188
+  "       "    wealth and income, 189
+  "       "    world attitude to, 263
+  "       "    world power of, 177
+
+
+Wealth and income, 189
+  "    of the United States, 89
+  "    ownership, 90
+
+Western Hemisphere, and the United States, 200
+
+World conquest, 218
+
+Workers' business, 257
+
+
+Yellow peril, 232
+
+
+
+***END OF THE PROJECT GUTENBERG EBOOK THE AMERICAN EMPIRE***
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