THE 'WHY' OF THE CONFLICT

Sun (Christchurch), Volume I, Issue 267, 15 December 1914, Page 2

THE 'WHY' OF THE CONFLICT

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O amount of boxing | lore will tell at the beginning of a match who of ithc two men will take the count, but it does not require quite as much prophetic power to know who will not get the prize at the< next beauty contest. This is approximately the situation with . _ respect 'to the out,*«ome of the European war. Sow it will affect the map of Europe is a matter -which depends on the course of that most Uncertain of all gambles, the game of war, in which a thousand and one unforeseen events may upset the calculations of the nest commanders and most clever generastaffs. But, after all, changes in the map of Europe are of more importance to geographers and makers of post office guides than io the world in general. Modern nations conquering a country*-do not expel its inhabitants and divide the lands among the invaders, nor do they any more convert peasants into slaves and- sell women for what they will fetch in the open market. The conquered country has at most to learn new laws, not essentially different from those under -which it lived before, and get the habit of dealing with conditions modified but not radically different from those of the old country. The Galician peasant is less interested in the name of the man fto-whom he is to, swear allegiance than an the question whether under that allegiance he will have to starve or will be enabled to have meat on Sunday all through the year. The merchant in East Prussia probably would very soon become tdjling to put up with his new masters Sf by doing so he could get better prices for his wares; sold to Siberia than he used to-when he sold them as "made-in Germany." - , i; . - . And even metrfar higher placed than the Galician peasant, with all their after talk about patriotism, actually think very little about changing their allegiance. There is a very illuminating

l|y Leon GoldmersTeinS ~1,.-" <n""' ' ' '■.!.. ■ i mi i ■ '" "' ii in m" ijiwii iiiirf

indicator. Now suppose that ; the more successful concern had a fire j and that it will take it two years to rebuild the factory and start new output. What will happen in the meanwhile, and after? Why, it will find that its trade is to a very large extent gone. Not only will it find that many of its customers have gone over to its competitors and cannot be lured back, but it will find a still more dismaying circumstance—NEW COMPETITORS HAVE APPEARED IN THE MARKET; FIGHTING \FOR THE SAME TRADE WITH BETTER WEAPONS AND FRESHER METHODS.

considered a poorer grade of goods, either on account >)f cheapness, or gaudiness, or backward design, as in the case of tools, will be a very slim one. But the loss of special markets means not only the loss of the trade itself, but also the loss of the very heavy investment which German manufacturers made in the form of development workspecial tools, t gages and looms. All these will have to go to the scrap heap, a sacrifice to the fetish of "export trade development at all costs." And with it will go the investment in the form of a selling organization built on the principle of "let* us know what you want and we will have it for yon, even at a loss to us." ■ ■■■••'. ■■ • ■ ••• .—■-•-■

is> far too complicated to be touched upon in a few words, especially as a new element of immense potential importance is injected into the situation by THE APPEARANCE OF THE STARS AND STRIPES ON THE SEVEN SEAS.

big gap created by shutting out Germany, across whose frontier there has flowed annually a current of trade valued at considerably more than $300,000,000.

The Russian chemical industries have been for some time quite active, and it was only the difficulty of competing with German imports that prevented the Russians from developing the production of chemical materials id their fullest extent. Nevertheless,. tbjere are already several Russian■;. such:; as the: TenteleffJ;' Chemical which; have invented several processes of chemical manufacture and are already independent of German patents in important lines production. - Russia has many first class,chemists (the,founder".of modern physical chemistry, Professor D. Mendelieff, was a Russian), as-well as a large number of young graduate** of its universities doing good research, work —an important element in the development of chemical processes where the cost of experimental work constitutes such a heavy item of expense. One may therefore confidently AT THE END OF THE WATt RUSSIA WILL BE IN A BETTER ECONOMIC AND INDUSTRIAL POSITION THAN BEFORE. To this must be added the fact that Russia is now to all practical purposes a dry country. The government there has the monopoly of the sale of alcohol, and AT TH& BEGINNING .. QF THE WAR Bit IMPERIAL DECREE THE SALE WAS STOPPED. Mai ■ ftteant-, of; course, to, the government ,;<i loss of revenue to the,; tune: Qf about $35,000,000 a month; but, apparently the Russian', finances are,,in" a- condition to stand it or it would not have been done. As the sale of alcohol was a government monopoly and the vodka sold was of good quality and comparatively cheap, police supervision, and economic considerations prevented an extensive development of the "blind tiger industry." , toils' country has really gone dry.,, From information received.this has-already produced a good influence on the general .life of the people, and even the government is coming around to the belief that a dry country is more easily kept in order. At the 'end of the war, therefore, the industry will have available an immense supply of labor free'from the grip of alcohol; and all those who have had experience with Russian wprkmen agree that on the whole they, would be excellent material for the : development of great industry, were it not £6y their, shiftlessnessand lack of reliability,: always traceable back to drink. France will suffer loss of men and the devastation of a fair part of its territory, BUT ITS INDUSTRIES ARE OF SUCH A PECULIAR KIND THAT THE CONCLUSION OF PEACE WILL MEAN FOR IT A BOOM SUCH AS NO OTHER COUNTRY WILL KNOW.

There is, however, one element bearing on the industrial situation in Germany we have not yet mentioned,; and that is foreign investments afld; the attijbuyers in the most? important markets, the latter being vernations with whom Germany is at war now. After all, apart from the United States, Germany had no better markets. .than Russia,. England and t its "colonies,; Belgium and France; and Ito; a) very large extent Germany financed itsindustry by French and British credits ..and investments. ■ j !; j It has been stated that German bankers aisserted with glee that if German industry is ruined it wil! be French and British investors who will suffer.' That. may be a pleasant thought while the war lasts,, but when German promoters come on the Paris and London markets three, and perhaps thirteen, years from to-day they will have to do a lot of explaining before they can get any new' money for enterprises east of the Rhine. There is such a thing as hilling the goose which lays the golden eggs, and that is the : hind of sport that seldom pays. ,

T"hat is what-'is going to happen to 'Germany,' J wHch"nataraily'must be considered first in this connection, for it is the nation more than any other one relying on exports in the development of its industries, and'it is also; the nation the business of which has been interrupted more than .that of any other combatant- It is. -therefore,, of- the greatest importance to find out just how Germany is going to fare after all is over, especially as, to a certain extent, this may give some indication as to the probable duration of the'present struggle. In the development of •German exports there are two elements Which have not been sufficiently realized and which have a tremendous bearing both on the present situation and especially on that which is likely to be created after the war. : • : '' ;v

The curse of the German export trade, as far as the Germans themselves were concerned, was that it* was done to a very large extent without due regard to the question of profits. After all, every man is in business for the income that he has to get out of it. A concern has sometimes to go into unprofitable undertakings when it expects special benefits to derive from it, but if the management is at all wise the unprofitable part of the business will be such as to affect the balance side at the end of the year in a manner as little noticeable as possible.

In Germany the export trade was too intertwined with politics for really close attention to he paid to profits. The government was very active in getting contracts for'the leading German firms,iand in doing so considered mainly the political bearing of the matter.' In St. Petersburg, Johannesburg and . Pekin alike, German consular and diplomatic agents were nothing but uniformed salesmen; and, to their credit, it must oe said that they did get the business. At the other end, in Germany, the concerns had to take the business even if the prices did not suit them; first, because it was considered in the light of a patriotic duty; and, second, because banking accommodations and railroad rebates arc predicated mainly on the amount of foreign business done by the company. All this created such a mixup in policies and accounts that, while the German industry did a tremendous amount, of business, the number of concerns that paid good dividends or had large depreciation and reserve dividend funds is surprisingly small. If there were firms with such funds it was because they did an exceptionally large amount of home business on conditions of absolute monopoly, and thus the home consumer made up for losses in the foreign trade. The groat bearing that this will have pn the post J bellum situation is this:— : The German government practically •forced the national industry to develop a large export trade in. order, first, to create in this respect a political machine scarcely inferior to the war machine in importance to German aggression; second, it was only by the development of "a" great export industry, even though done at a loss, that Germany could maintain a trade balance in the face of its large foreign indebtedness and mad expenditure for the army and navy at home. What German industry lost abroad was, in effect, a concealed premium paid for gold by the German banks, which otherwise would have gone bankrupt on account of naturally unfavorable trade balances; in the third place, exports were necessary to develop the German merchant marine and then to. justify the creation of a navy to protect it.

*tory to this effect told in the memoirs ' of the late Chancellor of the German

Empire, Prince Hohenlohe-Schillings-

furst. : The Prince-inherited vast* domains in Russia, where, according to the existing laws, no foreigner can hold land in th& frontier zdnev He would %t£?g to sell his land within the statute period.of threeiyears,. and; this, in view of the size of the estate, could not be done without heavy loss. He.went, therefore, to Russia to make some arrangements in this connection and also to find out the value of his inheritance. "The simplest way to get around it," he was told by a Russian friend, "is to hav-e one of your sons apply for Russian citizenship." "I must first find out if the value of the estate justifies such a step," was the reply of the man whom his country made rich, great and famous. With little vand great, it is all a: matter: of "whether the estate Justifies it." We may, therefore* leave the matter of the map of Europe to geographers and diplomats, as the only people who are really interested in it, and concern ourselves with the far more important matter of how the war will affect the conditions of Jife in the post-bellum Europe, and especially how it will affect the currents in the great oceans of commerce. We must not forget for a moment, however much we may otherwise cry out against the all powerful dollar, that it is trade after all that makes the most profound imprint on the destinies of peoples. When the man in Sheffield has plenty of work and good wages he sends his boys to school and keeps the girls at home until they are married. He becomes more self-reliant, feels himself a real part of the great British Empire, looks with' tiuspicion on socialists and anarchists and votes for the man whom he considers best. On the other hand. wh.cn the man in Chemnitz finds that hk business is gone and that there is but little chance for employment the first thing he does, is to place every member of the family at work. In days of ytress there are no ~idlers. The boys, from eight on, have to earn at least their own keep; the girls go to town as housemaids, into factories, shops and all those lanes of employment where, for the German maid, there is bo little profit and so much

The first..of these two elements Is that Germany in its foreign business, went in an extremely large measure after small lines. The United States also has a quite respectable foreign business, but it handles only what may be called staple commodities. It exports, iet ns say, typewriters, and makes them with Russian, Portuguese and other alphabets, but only when the amount of these special typewriters is large enough to make the handling of that particular line profitable. It exports a lot of steel, but only in fcizes and shapes for which there is either a large market at, or heavy orders have been received from -abroad. If an American manufacturer were approached with a small order 'for "V 'special article wanted in, say, the Chinese trade, .he'would probably decline to take it.

Now this spells overcautious conservatism on one hand, and may even develop into deplorable hick of initiative, but on the other hand let us see .for a moment to what the opposite tendency has brought Germany.

It is well known that a market in specialties is far more difficult to keep than in staple commodities. Above all. to .hold it you must make your Aoliveries certain. If you deliver to a jobber in Brazil the special goods which the Brazilian market demands, yon will keep his trade as long as you can hold up your end, especially if there is no competition. But if you have failed to do so for any length of time, the jobber will- not close his place. If he cannot deliver the exact brand that the trade demands, he will deliver the next best thing that icill satisfy the requirements of the market, and that will be your competitors' goods. As these goods are not made to special demand, with special gages, tools and looms, they do not carry with them the extra overhead investment with which all specialty trade goods are cursed. They can, therefore; be sold cheaper~and, like all staples, will in the end prove better made than those, made for a limited market. Result, THE MARKET IN TIL THEN FED BY WHAT IT DEMANDED, .IS NOW EDUCATED TO TAKE YOUR COMPETITORS' GOODS. If it finds them just as serviceable and at the same time cheaper, it will very soon begin to consider articles formerly made for its special market as OLD FASHIONED AND WILL REJECT THEM LATER FOR THAT VERY REASON.

When the smoke of battle clears away it!will be found that the political importance of the export trade is gone, together with plans for aggressive politics. BECAUSE, IF THIS WAR ACCOMPLISHES ANYTHING, IT WILL CERTAINLY MAKE NATIONS UNDERSTAND THAT FOR A FEW YEARS AT LEAST ALL IDEAS OF AGGRESSION AT THE EXPENSE OF WEAKER NATIONS MUST BE LAID ASIDE. THE SIGNING OF A PEACE TREATY MAY NOT BE THE BEGINNING OF A MILLENNIUM, BUT IT WILL BE A RESPITE FROM THE. HELL OF WAR.

In addition - to that one must count with; the sentiment of the : buyers.r. In trade quality ; and prices have about ninety-five per cent influence in.: the decision as to the' place' of purchase of but there is five per cent of • sentiment,* future considerations, &c," which must not be lost sight of: ; It was a very clever idea on the partof the German General Staff to appoint as officers of the troops f of occupation in Belgian towns German , "business men who have been residents '.'of "these towns before war began. We may. well assume that; thesa business men [were not actually employed as. spies pre-, . vi'qus; to the war, though there can be scarcely any. doubt that the-observations of- these , business men were not.-without value. But after the war will not the average Belgian merchant consider every German salesman in Lbuvain as the man who may NEXT TIME order him shot for expressing Ms ! horror at the burning of his native city? This makes for the five' per cent of sentiment which will for a long time be a factor against business with Germany, AND IN OUR DAYS OF SMALL PROFITS FIVE PER CENT MAY BE ENOUGH TO.TURN THE FDDW OF BUSINESS ONE WAY OR ANOTHER.

temptation and danger. And the man himself, with family broken up, future . uncertain, the present terrible in its anxiety, may be well excused for taking np any method of forgetting his hard--ships, be it alcohol or anarchism. Morality, not in the individual but in the masses, after all is to a very large extent a matter of conditions, and it; is the great fortune of this country that it. is in itself such a great consumer of its Dwn products that, no matter what may happen, American workmen, led by the genius of American engineers and business men, will always be able to maintain their standard of life well aboye the average of most countries of Europe. There are: two essential elements in the situation created by the war with which one has to count with respect to its probable outcome and bearing on the world's trade, and they are the present diversion of the flow of trade and the

When Germany comes back to Brazil, China, Argentina and a good many other countries to which it used to export hundreds of millions' worth of goods manufactured for these special markets it will find that such goods are now in demand only in the most backward, and therefore poorest, sections of the country and that every where else people are perfectly willing to take' the staple goods and are rather proud to be "dressed and addressed" like Americans and : Englishmen, rather than maintain their out of date fashions and methods; In their willingness to deliver to countries somewhat backward in their velopment exactly-what these countries demanded the Germans got their trade at a cost concerning which more will be said later; but on the whole they have been an element of retrogression rather than progress, and that never pays. You can pander to the worse feelings of a people or help them develop the better ones. It is not necessary to explain to the American public which method pays better in the end. And now that the United States and Great Britain have got a chance at educating foreign markets in the consumption of the best that they can make for their own exacting home markets, the opportunity for Germany to get back the trade in what must be

Trade expansion as a means for the maintenance of a balance also will be scarcely possible for Germany after the war, and that for several reasons. The financing of the war expenses, now done by the issue of temporary securities, will in the first years after the war create such a drain on the world's resources that few new securities will find a market Then the contraction of the business of concerns which now are kept going by government orders for purposes connected with the war, preceding by a couple of years the resumption of the regular business on the usual scale, will for a time produce such a general depression all over the world that nations will guard their resources too jealously to permit anybody to do much exporting for the sake of the balance of trade. At least, the rapid contracting of exports after the panic of 1007 in this country teaches us this lesson. We may leave out of discussion the matter of exporting for the sole purpose of developing the German navy, as the whole matter of sea trade after the war

This is particularly important in view of; the fact that a-very large share of export trade is done with large corporations, municipalities and governments, especially with the two latter classes, whose field of activity has a strong, tendency to expand in all directions. With this class of buyers it may be conservatively assumed that sentiment, political considerations, &c, play not five but at least fifteen per cent, and a fifteen per cent handicap is absolutely prohibitive to modern business getting.

ability of various countries to finance > the resumption of traffic after the war. Imagine for a moment two concerns vigorously contesting the trade in a certain line, say a certain kind of speed

Suppose that two concerns are out for an order for electrical machinery for, say, the London County Council lighting station, the Thomson - Houston Company on one hand and the Allgemeine Elektrozitaets-Gesellschaft on the other. Both are really foreign concerns, the first American and the other German, Suppose that the German concern quoted ten. per cent better prices. Who after the war would get the contract? The London County Council and its electors would not fail to recall the days, the memory of which will stay fresh for a long time, the German concern was supplying machinery to blow up the city of London by Zeppelin bombs, while the American concern, at a loss to itself, was running the only factory which could supply carbons for the British searchlights. WHO WILL GET THE CQNTRACT? Add to the foregoing the fact'that of all; the countries engaged in the present war Germany will suffer the mosi from the interruption of trade. For instance, Russia exported mainly raw materials, such as foodstuffs, manganese, platinum, furs. Its factories worked exclusively for the supply of the home market, which proved always too big for the'm, and had to be supplemented by foreign imports. What the war means for them is, therefore, a necessity to satisfy the local demand, and that means good wages for the men and good profits for the employers. If we take into • consideration the big demand on the production of Russian factories due to government orders, we will easily get an idea of the rush which must just now prevail in the Russian shops.

French wines, articles de Paris,- silks, &c, appeal to the classes which will be least affected by the war> and the rich department stores of America, as well as the fashionable stores of the five continents, will send their buyers to lay in supplies of those beautiful things for which their customers have been hungering. In addition to that, the main industry of the French people—and that is loaning money to countries in debtwill also begin flourishing anew after the war, and while the peasant in northeastern France will try' to rebuild his home, burned by German uhlans, the wine grower of Bordeaux the baker of Paris will consider what investment to make and whether to. take up American securities or Russian loans.

A possible move of importance in the future may be the tightening of the imperial connections due to the. war. An all-empire tariff, which would have given certain preferential rates toßritish imports in the colonies, is a thing of which British manufacturers have been thinking for a long time, but which a s;ear ago could not have been broached fol many reasons. It' is curious that }iiow:;it is tion's the th'e first timiej s#J that it is riojt un|ifeely>tiiat;itfter wai§ one may see accomplished what has been the dream of men like Chamberlain and Cecil "Rhodes. But even if the dqlao.t"help the British manufacr • tnrer : he will Wis6we"rfuliy so ppdrfed Tby the patriotic feeling which is so strong in' the colonies now, as well as by that objection, to German methods which is felt in; tlie-places. "back or beyond," in Africa, Australia and Asia, mores than in Sheffield and Manchester. Thus we see that of the four great participants in the present struggle one will come out with her industries crippled, if not crusted, with her commerce largely gone or taken by her former competitors and with her credit system shattered by the loss of the markets on which it formerly relied and which in time of stress it has deliberately treated unfairly. We see also that the other three combatants. will come out at least as strong as , before : ; the .war, probably*; stronger, and this not only holds good in the case of a ; l.png : war, but; becomes all; the more pronounced the longer the ; war lasts.' ... . ...... -.,..- .-.

',, When Lord gpe3.ks.af a war, of three years, he has in mind the fact.; that wars nowadays are carried; on not only on the fields, of battle but' on :the far more important field of economic life. War requires; money, bnt in addition to that.it must be carried'on in su<ib a way as to destroy as little as possible the business of the country. The longer the 'war. lasts' the more profoundly'if affeet3 the life; of-a If the war were, to \ end to-day ' Germany Should lose far less of its world's trade than after tie war has gone on foi* a year, when the supply of German goods will B bave run ! put everywhere, and people will- have to "buy - British/.; and •. American goods, whether they want them or not. If; the' war runs on for three years, AND, FRIGHTFUL AS THAT MAY BE, THERE IS NOTHING TO. GItE ASSURANCE THAT . IT WILL, NOT, England will go on. developing: its over- i seas trade; the United States will develop its industries; Russia,.with its tremendous production of .grain,' will go on building its chemical factories and machine shops; France, with the southern ports free,' will import and export all she wants, and it will be only Germany that will have to meet a shortage of food and gasolene with a dead export trade. Time is with the; Allies not only because of their greater facilities for supplying their armies with men, but also because of their different, and on the whole better, economic condition. As far as the outcome is concerned, that means that the longer the war lasts the better equipped will the United States, England and Russia be to meet- the German competition.

Even during the Japanese war, when the number of men in flie field hardly amounted to as much as one-quarter of these engaged now, and when fqr political reasons a fair proportion of the government orders went abroad, the Russian shops were rushed to capacity and the wages went up in many cases, voluntarily, ten to fifteen per cent. Then, however, imports were free, while now the Russian industries have to fill up the

In 1871 Prance, weakened by the misrule of Napoleon, paid a contribution of a billion dollars to Germany and two years later was ready to. make extensive investments elsewhere. It has had now forty-four years of. peace, and good business, and its financial reserves are so tremendous that it will have no trouble whatever "to continue doin.s business at the same old stand" and ii the same curious way —a combination of conservative trading and apparent recK lessness; however, with an always increasing balance of saving at the end. And what about England? From what one hears about the situation, in the British Isles the impression is that there people view the future with a considerable amount of cheerfulness. The British trade did not of late expand as much as the city of London would have desired; in fact, in several places the British commerce has lost ground before the impact of German exports, but WHAT TRADE GREAT BRITAIN DID KEEP WAS OF THE BEST CLASS, WITH RELIABLE CONCERNS WHICH PAID PROMPTLY. This trade British firms will have no difficulty to hold, as the Union Jack is flying over the high seas without too much trouble from the few German cruisers still at large. In addition to that the English are going in a very systematic manner after the German trade. The Board of Trade has compiled comprehensive and reliable data on German exports and is ready to furnish. th4U» t» British concerns.

The war will leave a deep imprint on the banking and corporate life of .the European countries. Already before the war there was a strong tendency toward consolidation, either in the form of several concerns uniting in one or by what is known in this country as trust formation. The war, and especially the economic reconstruction which Will follow it, must naturally intensify this tendency, because, to do big things the industries must stand together. This will be considerably facilitated through the fact that temporary organizations covering various fields of production have been either perfected before the war or are being perfected now—often with the collaboration of the government—for the purpose of meeting the ?reat problems created by the war. Europe is practically starting on the same way which after the Spanish war brought in the United States the formation of the Stee!, Wool, Tobacco and other trusts, with the important diffeience, however, that while here the trusts have been all the time considered as things that have to gain their right to exist by political trickery, if not actual bribery, in Europe they are apparently going to take a saner view. THE TRUSTS UNDER PROPER GOVERNMENT SUPERVISION ARE AN INSTRUMENT OF ECONOMIC LIFE CAPABLE OF DOING AN IMMENSE AMOUNT OF GOOD. TO FURTHER THIS THE GOVERNMENT MUST KEEP ITS EYE ON THEM AND AT THE SAME TIME HELP THEM AS FAR AS POSSIBLE. What a splendid business could be done in the United States if such a view were accepted by the government and big business! And there is every indication that that is exactly what is going to be done in Europe, especially in England and Russia. Germany has been doing it to a cor-

tain extent already, with the difference,*« ' however, that it was using its* trusts for political purposes of foreign ex- < pansion, and in this way prevented them from making any moneyl 1 To this must,be added anottier influence which it would be difficult -to express in figures or percentages, but. . which is apt to affect the conditions of - life and industry in Europe more pro-. foundly than: perhaps the war!itself. The twentieth .century has been jso far fuller of open or, nascent revolutionary ' ( movements than any other equal ;period i ofl modern times. The revolutions in i RJassia, Persia, Turkey, China, )Portu-« *} gal; the* spirit of- deep unrest in Germany, Prance, England; the socialistic j movement in Italy—all of them, created j a spirit with which the governments had Mor£ and more difficulty to deal. Con- j ,'trairy to apparent expectations in the~ j Unifed States, where-a good many people j -, European thrones will be sold J j at auction in furniture shops after the «'" war is over, the general tendency seems ,*: to be all the mother way, and it is quite thaj most of the monarchies, with . , qf; Ausfirl|l,- vill \ ' remain monarchies, with one important difference, however, and that is that THE MONARCHS WILL RETAIN THEIR" CROWNS; BY BECOMING • , ADVOCATES OF THE . > sAGAINST THE CLASSES;'' *£ " That very consolidation of industrial and banking interests which is likely to become the most significant feature of the post-bellum Europe ,be exr pected tovbecome the element which will make the masses look for* a power able and willing to protect, them against the otherwise invincible /force.''of concentrated capital.. Just as the President of .the United States is considered, with justification, the protector of, the. passes, , so: the kings and emperors;.Of Europe ... Hlay,'l speakingi colloquially, ' in; keeping tbiejr jobs, and perhaps-'even-& bettering their positions,' by coming out', openly as representing democratic ideals,; (i and there 'is plenty of proof that they : . have already their chances'iii'this direct' ' tion. ; THE KINGS OF v iEUROPfi : ARE GOING TO BECOME HENOK FORWARD NOTHING BUT HERED " PRESIDENTS OP THE!J RESPECTIVE COUNTRIES, AND THEY HAVE 'FOUND ',. QXJT THAT IT. BETTER W , BE; HEREDITARY- PRESIDENTS: ;, .•THAN HEREDITARY s ■ etttate'meh ichd are lvolditig,Bvfsh"av&n'ite*'V mansion^ ' for the • ■ crowned liead» :: • of- ; - : Eiiropewill therefore, haveilo' i6kit, : or' ; sett itiem, to local '/kingk 'of steel and': copper. •-., .. ~...,; .;. it i ... ■.:,;•■ In the face of a tremendous concen-, tration of capital in European; qountries,; - we'are therefore apt'to witness,a powers . . ful rise of democratic ideas? in the: masses.' It Would not be surprising to> ••;' see that capital, rather than fight a ! battle in wiiich ; it is surO to lbse in the end wilt at once make such concessions to labor as it would'have to make lateiv. on, and,. while here again it would ~ be foolish-, to expect: the :millennium, . , peace, in;the industries and good, -will . toward the employers;'ohe" may confi* :-i. dently look forward to higher wages, better conditions of living and more facil- "" ities for the education of t£e children of - workmen. This, by the way, is of interest to., this country, as it, will ma- •...'; terially affect the flow .of. /emigration , : •westward. --<■■■' To sum up:— The outcome of the war will be great losses to the.German commerce and a ; complete change in the export policy of ; the Kaiser's land, including the dropping . of specialized lines and lines carried at ; a loss for political purposes. This will mean better prices and conditions in the export trade generally, .conditions -; through which the United States and • England will profit in the first place. It will also mean an expansion of eigri trade for England and development '.,' of new lines ,bf,industry ; for Russia. ( K It also will mean concentration; of capital, the birth of really big business in ; Europe, done under government supervision' and with the good 1 will of : the 1 ' country. l ' "'■' '" ; '.'■'.''.'<'."'...' .'.','■.<.''. Democratization of the .throne, and . v . open ranging of the imperial power and ; kingly powers on the side of the masses. • Important•• concessions to labor' and '■■•■ working classes generally given both by !; ■■';• the Ibig business and by the government. - •' On the whole, one cannot 'help expressing the conviction that, THE WORLD AS A WHOLE WILL COME OUT OF THE PRESENT WAR BETTER AND CLEANER THAN IT WENT INTO IT. IT IS A PITY AND A SHAME THAT EUROPE HAD TO BE STEEPED IN BLOOD IN ORDER TO UNDERSTAND THAT MODERN NATIONS CANNOT LIVE UNLESS THEY LAY AT, T3^! ; FOUNDATION OF THEIR THE GREAT IDEAS OF. DEMOCRACY. ;! •;■■. -••-.■ ".:..■.-■!:■ ": I'

BUT ONE MUST NOT FORGET THAT THIS IDEA HAD TO BE LEARNED AND THAT ;* THIS v KNOWLEDGE HAD TO' B B ; BOUGHT AT THE JPRICE: BLOOD. HAD NOT THE PRESENT WAR COME TO TEACH T/HETtfi--, TIONS OP EUROPE THIS jREAT; LESSON THEY WOULD HAVE; I LEARNED IT IN A REVOLUTION PERHAPS AS BLOODY AS THIS WAR. ~■■•/.•:

AND ONE CANNOT HELP THINKING THAT IF BLOOD HAD TO BE SHED IT IS BETTER THAT IT SHOULD BE SHED IN A WAR THAN IN REVOLUTIONS.