The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1918-10-26
OUT OF DEBT.

OUT OF DEBT.
with the end of the war the United
States will be forced to emerge from a
state Of relative financial isolation.
This position will come without our
seeking. It has been thrust upon US.
It's fruits will depend on how wisely
and in how broad-spirited a manner
we utilize the opportunities that must
come to us.
Prior to the outbreak of the war in
1914 we were concerned almost entire
1y with our domestic problems of in
dustry and finance. Several brave at
tempts were made to extend our over
seas trade, but in the main these eff
forts were confined to far-sighted
mercantile firms, large manufacturing
companies like the United States Steel
Corporation. concerns manufacturing
sewing machines. typewriters and 9TH
er useful articles for which American
inventive genius and enterprise had
guaranteed a market almost free from
competition.
War changed all this. says the Woll-
man Review. Foreign trade which
We had sought in a spasn1odic way
came to us with orders that demand
ed to be filled. Prices offered were
higher than domestic consumers
would pay. So the goods went abroad
War brought us foreign market with
profits exceeding those hitherto af-
forded by the greatest buying power in
the world.
Prior to 1914 we prided ourselves
on our favorable trade balance" The
balance was favorable only in a nomi-
nal sense. Our exports of raw ma
terials-wheat, cotton, copper and
other products-as well as crude and
finished manufactures were in excess
of the value of our imports. Never
theless We always had a tidy bill to
settle with Europe every year.
In our self-exultation over our
trade balance we were accustomed to
overlook several important items. Eu-
rope owned billions of dollars worth of
our securities and we were forced to
send abroad hundreds of millions to
pay interest and dividends. Our tour
lists spent several hundred millions an
nually seeing the sights of the ola
world. Our exports were carried in
foreign ships, and freight bills went to
swell our foreign obligations. Other
items consisted of insurance pre-
miums, adverse rates of exchange, to
say nothing of the steady drain caused
by the remittances of alien 1aborers to
their home countries.
Altho we had for ten years prior to
the war an average net balance of
about 100000, figured in the ex-
cess of our exports over imports. we
were not reducing our foreign debt
more than slightly, if at all. In other
words, in spite of the enormous pre-
ponderance of our exports over i'm
ports we were still firmly in Furone,s
debt. Our favorable excess merely
went to carry the obligation without
curtailing the principal. We had to
pay Europe about half a billion a wear
for the items above detailed, and we
paid them by sending about half a bill
lion dollars worth more of goods tina
we imported.
SAheSAiSApdllOH 1EO1H OeDL began
in 1914. At that time Europe held
American securities valued at about
four billion dollars. The larger por-
ton OF these has been sold back to lis.
The excess of our exports over our i'm
ports during the four years from July
l, 1914. to July 1, 1918, is s10.11O,-
100000. The excess of silver exports
over imports is $195,o0o,oOo. making
a total of $40. 10000. 900. Our enor-
nous trade balance, this time an ac-
tuality, enabled US to buy back our
American securities from Europe and
leave US a reserve in addition. We
have loaned to European countries. in
the form Of direct loans and credits.
more than $1,000. 100000.
The figures cited above show that
we have discharged our old debt to
Europe. and that our loans to our
European allies will place them in our
debt to an amount that may be some
where between nine and ten billion
dollars by the time the war ends.
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