The evening times. [volume] (Washington, D.C.) 1895-1902, 1901-07-11

cipaI of our debt abroad. In some way
the account has been balanced. and
each side has received full value
On the other hand. England's position
Is entirely different from ours She IS
an old country that has been accumu-
Iating capital for ages This capital she
has invested all over the globe. where
ever she has seen q good opportunity
It has been estimated by high authority
that her income from these investments
amounts TO at least five hundred million
dollars a vear-it may be much more
than that sum. But if We call it FIVE
hundred millions it Is clear that she can
buy three OF four hundred million
worth Of goods more than she sells and
still add largely t. ner wealth.
Take the case Of a private individual
as an illustration. \ man may be doing
q business which nets him say ten thou
sand dollars q year. If he has no other
means and his expenses are twelve
thousand he IS losing money at the rate
of two thousand dollars a year. But if
he also has money at interest which
brings him III ten thousand year then
upon final adjustment of his accounts
he IS still eight thousand dollars ahead
at the end of the year - with Eng
land She is a great industrial nation,
of course, but she Is also d great CAPT
talist. Her demand for necessaTies Is in
excess Of her productive capacity, and
she makes good the deficit cut Of the
income from her foreign investments.
But if her purchases had been smaller
it would have left her a larger final bal
ance for further investment, thus en-
IarSirg her income still more In short
she has added to her wealth in spite Of
the trade balance against her.
Take the case of India as another cx-
ample That country has a favorable
trade Enthusiastically speaking, a
hundred million dollars annually. She
is a very poor country, but her favor
able trade balance IS not the cause Of
her poverty It is largely a result I'M
mense amounts of British capital have
been invested in the country, and It has
been estimated that it takes from
eighty to ninety million dollars annual
" 10 meet the interest charges India
cannot send this sum in money. for the
reasons, first. that she has no more
money than her business requires. and
secondly that what she has Is II silver
which could not be utilized as money
Hence she must send goods, and So far
as she sells them in competition with
those of other countries she must OF
necessity put down the price. Thus the
trade while upon its face dISadvanta-
geous 10 England. is not 50 II fact She
gets goods which she needs some Of
them at reduced prices, and takes pay
ment chiefly ouL Of the profits upon her
Indian investments Certain industries
in England. notably cotton spinning.
have suffered more or less from East
Indian competition as a result Of the
peculiar monetary relations between
the countries, but upon the Whole they
probably have been largely the gamer.
When all the elements entering into
international trade are taken into ac-
count, there must in some way be an
equal exchange This does not mean
that all viii be equally prosperous. The
nation in debt ike the individual in
debt, Is always at q disadvantage But
whatever q nation sells it viii IL some
way get a full equivalent for, and It viii
not long continue to buy in excess Of its
sales. as England does unless It can at
ford To do so. In the long run the most
productive country viii be the most
prosperous one. If its business is well
managed and it IS not too heavily hand
fcapped by debt at the outset
Situated as We are. our huge export
trade Is an advantage, for It enables Us
10 meet ali demands against Us without
any pressure upon our money supply
But 1t does not follow that al immense
trade balance Is 50 essential that we
should en5eavor arbitrarily TO increase
1t by shutting foreign goods out Such
q course viii soon have the effect Of
limiting our own sales abroad. and even
before that effect is fully manifested II
results IN rank injustice to the great
BODY Ct our own people fer the benefit
Of q favored few. Fair, reciprocal trade
usually benefits both parties, but IN
fortunately there are many people in
the United States, some Of them in high
Official station, who appear 10 think
that the country can only prosper
through the inlpoverishmert Of other
nations.