The daily morning journal and courier., 1907-06-22


 Itutions and traditions. She has full! Iaccepted the modern idea, and hel lpeople are much more easily swung
 at this period, to support what is offer. led to them as an advanced policy ol lsystem than are the people of any western nation The success of the
 war has placed the oligarchy in com. lplete control. and for the moment, the lnational spirit is peculiarly suseepti- lble to any proposition to which is tackled the national banner. And the flag has been adroitly hoisted over 1.-the new paternalistic policy, which
 at present is moving with all the ener-
 gy a. common national impulse can
 give it.
 The termination of the war with Russia left Japan with many grave problems on her hands, and of these the most urgent is the state of the na- | tional finances. The government must
 have money, and the imperative ne-
 cessity for revenue is a primary, per haps the chief, reason for the taking over of certain industries. This ur-
 gency became acute Immediately upon
 the outbreak of war when it was not
 only necessary to have new revenues
 and increase old ones, but when col | lateral to secure interest on the new foreign loans had to be found. Un-
 der these circumstances the govern
 hent took over the tobacco, salt, camphor, opium and other minor in- dustries.
 When the war ended a great debt land It's accompanying interest burden had been rolled up. New revenues
 were required to meet the new ex- penditures, so the government cast about for anything that could be oper- ated at a profit. It passed a bill talk ing over all railway lines not already under government control, while measures to control the silk and match industries, and also the breweries, are now under consideration. These plans are cited not to call special attention to Japan's financial situation, but to point out that the naturalization of industry, so far as it has actually been carried into effect, has not been the result of a consideration of the whole proposition on its merits as an agency for the common good, as some casual western discussion seems to sume, but was primarily due to the immediate and imperative need for revenue, after all customary forms of taxation had been raised to the limit.
 In so far as it has devised a system to develop and advance the national interests, the government purposes to lend directly it's assistance to any form of industry that promises a pro- fitable future.
 Such a system pivots, naturally, upon the three usual hearings-fn cial, industrial, and commercial. The financial side operates through the banks, which in Japan are often di- rectly associated with the govern ment Great financial institutions like the Nippon Ginko (bank of Japan) the Yokohoma specie bank, and the Dai Icho Ginko (the First bank) are really as much a part of the govern ment, in regard to transactions which may affect the national interest, as the department of war and foreign affairs. Through them are negotiated all foreign and domestic loans of any magnitude. and they al- ways stand ready, at the suggestion of the government to come to the sup port of any private or national indus try or enterprise which may need as- sistance.
 In the effort of the government to exploit Korea and Manchuria and es- tablish Japanese commerce so firmly In those localities that it cannot be disturbed by competition, an arrange nent was effected by which the banks are to make loans to Japanese. .mercan- -ile firms exporting to the continent. l 1t a reduced rate of interest, with re- oates to those who are able to do an annual business of a certain magni- | ude5 It should go without saying hat no bank can do profitable busi- | less after this method, and it is worth | while to inquire how Japanese banks Ire able to manage 1t. When the war i 'nded the government fortunately had | n its possession the proceeds of the ast foreign loan, which. taking ad- 'antage of Admiral Togo's naval vic- ory, It had favorably placed in Eng and, Germany and America This honey was deposited with several of he larger banks to be disposed as the government directed Part of this honey is now being used to supply the inews of war to the new system, and being loaned, in some, instances, at
 lower rate of interest than it costs he government.
 Competition In trade is general and is often stimulative but has hitherto been chiefly confined to individual or corporate entities Ve now see it added to he direct national activities f a cohesive and hustling nation. The ossibilities are many. It may be, hould Japan's daring innovation be tccessful that the commercial and in- rstrial rivalries of the future will be- ome, to an extest not thought out to- ay, international affairs Not only does he logic of the proposition presage ich a development, but Japan has de- berateiy announced her intention 10 rive other industry and commerce out certain fields, and is marshaling the ational epergy and resources to sup ort the movement. In promulgating her new system apan uses both the direct and indirect is, ownership and subsi- y. This fact clearly indicates that the nd, and not the means. is at present le chief consideration; since an ana sis of the two methods as here ap-