The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1908-02-15
SATURDAY, FEBRUARY 10, 1905.
Prosperity is n gift of God when
He comforts; adversely IL n gift of
God when He warns.-St. Augustine.
OUR DEBT ABROAD.


In the January number of the
sewanec Review Mr.. w. II. Allen, of
Brooklyn, publishes an analytical ar
ticle. in which he undertakes to show
that the panic of 1907 was due to the
fact alleged that we owed enormous
sums of money abroad, which we were
unable to pay, and this, too, in spite
OF the exhibits made from year to
year of a large balance Of trade in
our favor. For example he points
out that the net exports OF n1erchan-
disc for the fiscal year ended June
so, 1905, amounted to siO1 900, 900,
while net exports OF gold amounted to
sss,ooo.ooo and net exports of silver to
sei,ooo,ooo. Now, it, says he, "as has
heen asserted our annual foreign debts
do not exceed s25o.ooO.o0o then we
should have imported s15o,ooo.oo0 in
securities. or had it standing to our
credit abroad But instead. we ex-
ported s;saooo,00o in cash, more than
we. imported. sold hundreds of mil
lions worth moro securities than we
got back. and borrowed many millions
more" He estimates that for the year
mentioned we paid in interest, etc, on
foreign capital s3o0,oooooo; that
immigrants boarded s2o0,Ocooo0; that
the expenses of Americans abroad
amounted to s125,OoO 900, and the cost
of ocean freight $125,oOOooo, making
a total of sT5O,O00.00o.. He declares
that our foreign debt has been in
creasing, instead OF diminishing since
that time, and that while bankers have
managed to prevent gold exports by
manipulating foreign exchange, ir
spite of the, manipulation, every now
and then our gold takes wings, ant
panic or the threat of 1t follows. He
asserts that in 1906 we had to resort
to borrowing to prevent gold exports
at which time we owed from $500 OoO,.
600 to s750OOO,OOo abroad. "Thl.
method of avoiding the inevitable" hi
proceeds, chad to come to an enc
some time. After putting out $500
100000 worth of securities in the frs
ten weeks of 1907, we had the pani
Of March 18th After this event tn,
oracles declared that liquidation hat
run its course, and the worst was over
but while they were, still boosting tn
August panic cane along to prove hov
little they knew about the situation.
Our trouble is. he concludes, that W
are each year paying out more for TIL
use- OF foreign capital, foreign labo
and for expenditures abroad than gu
exports of merchandise can offset, an
that it is time for us to learn tina
Micawber's philosophy is as true O
large scale as small one: "An
nual income twenty pounds annua
expenditure, twenty ought-six; result
misery"
Mr.. Aliens "facts and figures" ar
entertaining although his figures ar
largely estimates, but his deduction
are pessimistic and misleading. If W
were piling UP foreign debt eac
year BY purchasing from Europe eac
year more goods than We sell, IL
situation would be alarming. but who
the balance in our favor on this a
count is nearly half a billion dollars
year, 1t does not denote an unhealtl
situation that we are borrowing lar!
sums of money abroad with which
do business The only question
whether or not we are using our DO
81 roWed capital profitably; and it a
pears that we are. The same is trr
OF foreign labor employed here.
ouch laborers earn their wages and
profit by their employers? IL so Il
more money we expend in that d
reciion, the richer we shall be. II
foreign money we borrow is not Ell
ployed in foreign trade alone. 1t
used in developing our commerce a,
Industries at home-in. increasing O
wealth. II we are realizing prot
On the money we borrow abroad, '
MI are making, and not losing, by L
transaction.
1t may be that we have strained o
Il credit abroad, and the foreigners M
cali upon us to pay at an inconvenie
season. and all that; but with ri
md growing country, like ours. ha
Ing surplus products worth half b
lion a year TO sell. borrowing mon
to trade with is not sign OF dlstre
but of progress.
4i}a s-------=----------------
ABOUT RISING IN THE MoRNIN
TWO thoughts about mans sleep,
rather about his getting up, emei
sram the news OF the last day or L