The Spokane press. [volume] (Spokane, Wash.) 1902-1939, 1904-10-10
Financing the War

The fact that Japan is about to float another loan of
$4O,OOO,OOO, thus bringing her Indebtedness up to $4,000
OO0, which is more than three times the national revenue,
is causing some concern as to Japan's ability to finance a
long war.
But this concern is not shared by the japanese minis
tiers or people or by anyone familiar with japanese fnan-
An Indebtedness three times as large as the annual
revenues is not abnormally large. The United States debt
is four times the revenues, Englands is five times, Italy's
seven and France eight.
As Japan's fixed monthly revenue ranges all the way
from $9,50O,OOO to 100000 and the war expenditure
does not exceed for the present year $15,8 900 monthly,
it is evident that the financial burden is not too heavy to
be easily carried.
Japan's latest foreign loan of 5O,OO0,OOO made i n
London and New York, in May, was oversubscribed five
times in New York, while the London subscriptions were
covered 80 fold.
The japanese people responded to the last issue of
$5OoOOyOOO %exchequer bonds with the offer of four times
Decidedly different is the financial condition in Rus
sia- 1t is there that the question of financing a long war
is really serious.
DR.. E. }. Dillon in an article in the Review of Reviews
makes the astounding assertion that from one-sixth to one
third of the Russian peasants income is already taken by
the state, the average rate of taxation being about II per
cent of the entire income of the peasant homestead.
The great danger to Russian finances lies in the chron-
ic poverty of the Russian people. And this poverty is
made all the more abject by the war, which has caused
cessation of all public Improvements and %paralyzed pri-
waite business.
In Russia the government is the most important en-
ployer of labor and the chief purchaser of pig iron, rails,
coal, ETC., and in order that all possible public money may
be diverted to war purposes tens of thousands of hands
are turned adrift to beg or steal and to contribute nothing
to the support of the government in its crisis.
And simultaneously with this withdrawal of capital
another factor almost equally disastrous made its appear
ance. The railways which connect the Asiatic with the
European half of Russia were transformed into purely
military lines, along which soldiers, munitions Of war, sur
gical appliances, food and forage were conveyed, ousting
almost all private merchandise and p%aralyzing the enter
prise of private firms. Western Russia being thus cut off
from the eastern provinces, large stocks are left on the
hands of middlemen or producers, who are unpaid for past
sales, deprived of orders and confronted with bankruptcy
Even in st. Petersburg and Moscow, scarcity Of
money, stagnation of trade, bankruptcy and an enormous
increase in pauperism mark the extreme paralysis OF Rus
sian trade and finance.
Russia, too, is about to attempt a new loan. Her ex-
tremity is indicated by the fact that she dare not attempt
a loan for direct war purposes, but will disguise 1t as a
productive loan for the construction Of railroads.
No difficulty of financing a long war does not lie in
Japan.