Cameron County press. [volume] (Emporium, Cameron County, Pa.) 1866-1922, 1908-01-30
NATIONS ONE HOPE
IMPORTANCE OF A NATIONAL
TRADE BALANCE.
One of the Functions of Protective
Tariff Is So to Restrict Imports as
to Enable the Country to Pay Its
Obligations and Have Something
Left.

"If it had not been for this balance
of trade in our favor, constantly liqui-
dating our obligations, our debts
would have become insupportable long
before now"
This remark by the New York
Press is of wcighty Importance, and
should receive from our financiers far
more attention than they habitually
give to the question Of favorable trade
balances. The fact is that our mon
eyed magnates are for the most part
either ignorant of or Indifferent to
the part played by the trade balance
in maintaining our supply of money
and money metals 1t must be that
they are ignorant. for if they were in
formed they could net be indifferent
They ought TO realize the part played
by protective tariff in so restricting
competitive imports as to insure an
excess of exports, and therefore a
trade balance-mOney coming to us
faster than it goes away from us. Yet
if you should scratch the back of an
> eminent fnancier it is ten to one you
would tickle either free trader or
man who knows little and cares less
about the tariff question.
The habit of depreciating the con-
sequence of favorable trade balances
is quite common among the superior
thinkers" turned loose by our free
trade institutions of learning. They
point at Great Britain, free trade ma
ton, with an average excess of i'm
ports over exports amounting to about
SS0O,0OO,00O year, as a shining ex-
ample of how country can grow
richer in spite OF adverse trade bal
ances. This contention is well an.
swcred in the Press as follows:
England is a creditor nation The
British adverse trade balance does not
represent what England owes at the
end OF each year. 1t represents the
payments on account by the debtor
nations that owe interest and princi-
pal to England. creditor of the world.
England's adverse trade balance is
the same as the pawnbroker's. The
lender whose trademark is the three
gllded balls over the door of his
money shop advances his capital to
the borrower, who must pay over to
the pawnbroker a share of the debtors
product as long as the debt stands
uncanceled. The debtor exports to
the pawnbroker necessarily: he i'm
ports from the pawnshop nothing
but receipts. Unless the debt is liqui-
dated that sort of adverse balance of
trade against the pawnbroker leaves
him with all the money in the end.
So long as Canada or any other coun-
try remains a debtor nation an ad-
verse balance of trade piles up a
growing debt each year more difficult
to discharge, since more of the re-
sources of the debtor are required to
pay the mere interest"
One of the most important func-
tions of a protective tariff is to bar
the door against competitive imports.
Not only does this wise policy enable
the United States to cancel it's debts
for goods and materials purchased
abroad and have something left with
which to make good for some heavy
outgoing amounts of American money
not visible in the record of exports,
but it has in the past II years actual
ly added some billions of dollars to
the supply OF money and money met
ais. Still more important, it has pro-
vided work and wages for millions Of
Americans. Great Britain has kept
solvent because Of income derived
from money loaned and invested in
other countries and from the earnings
OF her merchant marine. But for these
sources OF income there is no need to
say what would happen 10 a country
which bought $SO0,0OO 900 year more
than it sold The United States has
neither an oversea carrying trade nor
any income from money invested
abroad TO country so situated q