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Italy and Spain--India--Japan--The United States--The cotton, woolen, and silk trades,--The growing necessity for each country to rely chiefly upon home consumers.

The flow of industrial growths spreads, however, not only east; it moves also southeast and south. Austria and Hungary are rapidly gaining ground in the race for industrial importance. The Triple Alliance has already been menaced by the growing tendency of Austrian manufacturers to protect themselves against German competition; and even the dual monarchy has seen its two sister nations quarreling about customs duties. Austrian industries are a modern growth, and still they already give occupation to more than 4,000,000 work people.¹ Bohemia, in a few decades, has grown to be an industrial country of considerable importance; and the excellence and originality of the machinery used in the newly reformed flour-mills of Hungary show that the young industry of Hungary is on the right road, not only to become a competitor to her elder sisters, but also to add her share to our knowledge as to the use of the forces of nature. Let me add, by the way, that the same is true to some extent with regard to Finland. Figures are wanting as to the present state of the aggregate industries of Austria-Hungary; but the relatively low imports of manufactured goods, are worthy of note. For British manufacturers, Austria-Hungary is, in fact, no customer worth speaking of; but even with regard to Germany she is rapidly emancipating herself from her former dependence. (See Appendix G.)

The same industrial progress extends over the southern peninsulas. Who would have spoken in 1859 about Italian manufactures? And yet--the Turin Exhibition of 1884 has shown it--Italy ranks already among the manufacturing countries. "You see everywhere a considerable industrial and commercial effort made," wrote a French economist to the Temps. "Italy aspires to go on without foreign produce. The patriotic watchword is, Italy all by herself. It inspires the whole mass of producers. There is not a single manufacturer or tradesman who, even in the most trifling circumstances, does not do his best to emancipate himself from foreign guardianship." The best French and English patterns are imitated and improved by a touch of national genius and artistic traditions. Complete statistics are wanting, so that the statistical Annuario resorts to indirect indications. But the rapid increase of imports of coal (9,339,000 tons in 1910, as against 779,000 tons in 1871); the growth of the mining industries, which have trebled their production during the fifteen years, 1870 to 1885; the increasing production of steel and machinery (£4,800,000 in 1900), which--to use Bovio's words--shows how a country having no fuel nor minerals of her own can have nevertheless a notable metallurgical industry; and, finally, the growth of textile industries disclosed by the net imports of raw cottons and the number of spindles²-- all these show that the tendency towards becoming a manufacturing country capable of satisfying her needs by her own manufactures is not a mere dream. As to the efforts made for taking a more lively part in the trade of the world, who does not know the traditional capacities of the Italians in that direction?

I ought also to mention Spain, whose textile mining and metallurgical industries are rapidly growing; but I hasten to go over to countries which a few years ago were considered as eternal and obligatory customers to the manufacturing nations of Western Europe. Let us take, for instance, Brazil. Was it not doomed by economists to grow cotton, to export it in a raw state, and to receive cotton goods in exchange? In 1870 its nine miserable cotton mills could boast only of an aggregate of 385 spindles. But already in 1887 there were in Brazil 46 cotton mills, and five of them had already 40,000 spindles; while altogether their nearly 10,000 looms threw every year on the Brazilian markets more than 33,000,000 yards of cotton stuffs.

Twenty five years later, in 1912, there were already 161 cotton mills, with 1,500,000 spindles and 50,000 looms, employing over 100,000 operatives.³ Even Vera Cruz, in Mexico, under the protection of customs officers, has begun to manufacture cottons, and boasted in 1887 its 40,200 spindles, 287,700 pieces of cotton cloth, and 212,000 lb. of yarn. Since that year progress has been steady, and in 1894 Vise-Consul Chapman reported that some of the finest machines are to be found at the Orizaba spinning mills, while "cotton prints," he wrote, "are now turned out as good if not superior to the imported article."⁴ In 1910, 32,000 work people were already employed in 145 cotton mills, which had 703,000 spindles, and 25,000 power looms.⁵

The flattest contradiction to the export theory has, however, been given by India. She was always considered as the surest customer for British cottons, and so she has been until quite lately. Out of the total of cotton goods exported from Britain she used to buy more than one-quarter, very nearly one-third (from £17,000,000 to £22,000,000, out of an aggregate of about £76,000,000 in the years 1880-1890). But things have begun to change, and in 1904-1907 the exports were only from £21,680,000 to £25,680,000 out of an aggregate of £110,440,000. The Indian cotton manufactures, which--for some causes not fully explained were so unsuccessful at their beginnings, suddenly took firm root.

In 1860 they consumed only 23,000,000 lb. of raw cotton, but the quantity was nearly four times as much in 1877, and it trebled again within the next ten years: 283,000,000 Ib. of raw cotton were used in 1887-1888. The number of cotton mills grew up from 40 in 1887 to 147 in 1895; the number of spindles rose from 886,100 to 3,844,300 in the same years; and where 57,188 workers were employed in 1887, we found, seven years later, 146,240 operatives. And now, in 1909-1910, we find 237 cotton mills at work, with 6,136,000 spindles, 80,000 looms, and 231,850 work people. As for the quality of the mills, the blue-books praise them; the German chambers of commerce state that the best spinning mills in Bombay "do not now stand far behind the best German ones"; and two great authorities in the cotton industry, Mr. James Platt and Mr. Henry Lee, agree in saying "that in no other country of the earth except in Lancashire do the operatives possess such a natural leaning to the textile industry as in India."⁶

The exports of cotton twist from India more than doubled in five years (1882-1887), and already in 1887 we could read in the Statement (p. 62) that "what cotton twist was imported was less and less of the coarser and even medium kind, which indicates that the Indian (spinning) mills are gradually gaining hold of the home markets." Consequently, while India continued to import nearly the same amount of British cotton goods and yarn (from £16,000,000 to £26,700,000 in 1900-1908), she threw already in 1887 on the foreign markets no less than £3,635,510 worth of her own cottons of Lancashire patterns; she exported 33,000,000 yards of gray cotton piece goods manufactured in India by Indian workmen. And the export has continued to grow since, so that in the year 1910-1911 the value of the piece-goods and yarn exported from India reached the value of £7,943,700.

The jute factories in India have grown at a still speedier rate, and the once flourishing jute trade of Dundee was brought to decay, not only by the high tariffs of continental powers, but also by Indian competition.⁷ Even woolen mills have lately been started; while the iron industry took a sudden development in India, since the means were found, after many experiments and failures, to work furnaces with local coal. In a few years, we are told by specialists, India will be self-supporting for iron. Nay, it is not without apprehension that the English manufacturers see that the imports of Indian manufactured textiles to this country are steadily growing, while in the markets of the Far East and Africa India becomes a serious competitor to the mother country.

Why should it not be so? What might prevent the growth of Indian manufactures? Is it the want of capital? But capital knows no fatherland; and if high profits can be derived from the work of Indian coolies whose wages are only one-half of those of English workmen, or even less, capital will migrate to India, as it has gone to Russia, although its migration may mean starvation for Lancashire and Dundee. Is it the want of knowledge? But longitudes and latitudes are no obstacle to its spreading; it is only the first steps that are difficult. As to the superiority of workmanship, nobody who knows the Hindu worker will doubt about his capacities. Surely they are not below those of the 36,000 children less than fourteen years of age, or the 238,000 boys and girls less than eighteen years old, who are employed in the British textile manufactories.

Twenty years surely are not much in the life of nations. And yet within the last twenty years another powerful competitor has grown in the East. I mean Japan. In October, 1888, the Textile Recorder mentioned in a few lines that the annual production of yarns in the cotton mills of Japan had attained 9,498,500 Ib., and that fifteen more mills, which would hold 156,100 spindles, were in course of erection.⁸ Two years later, 27,000,000 lb. of yarn were spun in Japan; and while in 1887-1888 Japan imported five or six times as much yarn from abroad as was spun at home, next year two-thirds only of the total consumption of the country were imported from abroad⁹

From that date the production grew up regularly. From 6,435,000 lb. in 1886 it reached 91,950,000 lb. in 1893, and 153,444,000 lb. in 1895. In nine years it had thus increased twenty-four times. Since then it rose to 413,800,000 lb. in 1909; and we learn from the Financial Economical Annual for the years 1910 and 1911, published at Tokio, that there were in Japan, in 1909, no less than 3,756 textile factories, with 1,785,700 spindles and 51,185 power-looms, to which 783,155 hand-looms must be added. Japan is thus already a serious competitor of the great industrial nations for tissues altogether, and especially for cottons, in the markets of Eastern Asia; and it took it only five-and-twenty years to attain this position. The total production of tissues, valued at £1,200,000 in the year 1887, rapidly rose to £14,270,000 in 1895 and to £22,500,000 in 1909--cottons entering into this amount to the extent of nearly two-fifths. Consequently, the imports of foreign cotton goods from Europe fell from £1,640,000 in 1884 to £849,600 in 1895, and to £411,600 in 1910, while the exports of silk goods rose to nearly £3,000,000.¹⁰

As to the coal and iron industries, I ventured in the first edition of this book to predict that the Japanese would not long remain a tributary to Europe for iron goods--that their ambition was also to have their own shipbuilding yards, and that the previous year 300 engineers left the Elswick works of Mr. Armstrong in order to start shipbuilding in Japan. They were engaged for five years only--the Japanese expecting to have learned enough in five years to be their own shipbuilders. This prediction has been entirely fulfilled. Japan has now 1,030 iron and machine works, and she now builds her own warships. During the last war, the progress realized in all industries connected with war was rendered fully evident.¹¹

All this shows that the much-dreaded invasion of the East upon European markets is in rapid progress. The Chinese slumber still; but I am firmly persuaded from what I saw of China that the moment they will begin to manufacture with the aid of European machinery--and the first steps have already been made--they will do it with more success, and necessarily on a far greater scale, than even the Japanese.

But what about the United States, which cannot be accused of employing cheap labor or of sending to Europe "cheap and nasty" produce? Their great industry is of yesterday's date; and yet the States already send to old Europe constantly increasing quantities of machinery. In 1890 they began even to export iron, which they obtain at a very low cost, owing to admirable new methods which they have introduced in metallurgy.

In the course of twenty years (1870-1890) the number of persons employed in the American manufactures was more than doubled, and the value of their produce was nearly trebled; and in the course of the next fifteen years, the number of persons employed increased again by nearly fifty percent, while the value of the produce was nearly doubled.¹² The cotton industry, supplied with excellent home-made machinery, has been rapidly developing, so that the yearly production of textiles attained in 1905 a value of 2,147,441,400 dollars, thus being twice as large as the yearly production of the United Kingdom in the same branch (which was valued at about £200,000,000); and the exports of cottons of domestic manufacture attained in 1910 the respectable figure of £8,600,000.¹³ As to the yearly output of pig-iron and steel, it is already in excess of the yearly output in Britain;¹⁴ and the organization of that industry is also superior, as Mr. Berkley pointed out, already in 1891, in his address to the Institute of Civil Engineers.¹⁵

But all this has grown almost entirely within the last thirty or forty years--whole industries having been created entirely since 1860.¹⁶ What will, then, American industry be twenty years hence, aided as it is by a wonderful development of technical skill, by excellent schools, a scientific education which goes hand in hand with technical education, and a spirit of enterprise which is unrivaled in Europe?

Volumes have been written about the crisis of 1886-1887, a crisis which, to use the words of the Parliamentary Commission, lasted since 1875, with but "a short period of prosperity enjoyed by certain branches of trade in the years 1880 to 1883," and a crisis, I shall add, which extended over all the chief manufacturing countries of the world. All possible causes of the crisis have been examined; but, whatever the cacophony of conclusions arrived at, all unanimously agreed upon one, namely, that of the Parliamentary Commission, which could be summed up as follows: "The manufacturing countries do not find such customers as would enable them to realize high profits." Profits being the basis of capitalist industry, low profits explain all ulterior consequences.

Low profits induce the employers to reduce the wages, or the number of workers, or the number of days of employment during the week, or eventually compel them to resort to the manufacture of lower kinds of goods, which, as a rule, are paid worse than the higher sorts. As Adam Smith said, low profits ultimately mean a reduction of wages, and low wages mean a reduced oonsumption by the worker. Low profits mean also a somewhat reduced consumption by the employer; and both together mean lower profits and reduced consumption with that immense class of middlemen which has grown up in manufacturing countries, and that, again, means a further reduction of profits for the employers.

A country which manufactures to a great extent for export, and therefore lives to a considerable amount on the profits derived from her foreign trade, stands very much in the same position as Switzerland, which lives to a great extent on the profits derived from the foreigners who visit her lakes and glaciers. A good "season" means an influx of from £1,000,000 to £2,000,000 of money imported by the tourists, and a bad "season" has the effects of a bad crop in an agricultural country: a general impoverishment follows. So it is also with a country which manufactures for export. If the "season" is bad, and the exported goods cannot be sold abroad for twice their value at home, the country which lives chiefly on these bargains suffers. Low profits for the innkeepers of the Alps mean narrowed circumstances in large parts of Switzerland; and low profits for the Lancashire and Scotch manufacturers, and the wholesale exporters, mean narrowed circumstances in Great Britain. The cause is the same in both cases.

For many decades past we had not seen such a cheapness of wheat and manufactured goods as we saw in 1883-1884, and yet in 1886 the country was suffering from a terrible crisis. People said, of course, that the cause of the crisis was over-production. But over-production is a word utterly devoid of sense if it does not mean that those who are in need of all kinds of produce have not the means for buying them with their low wages. Nobody would dare to affirm that there is too much furniture in the crippled cottages, too many bedsteads and bedclothes in the workmen's dwellings, too many lamps burning in the huts, and too much cloth on the shoulders, not only of those who used to sleep (in 1886) in Trafalgar Square between two newspapers, but even in those households where a silk hat makes a part of the Sunday dress. And nobody will dare to affirm that there is too much food in the homes of those agricultural laborers who earn twelve shillings a week, or of those women who earn from fivepence to sixpence a day in the clothing trade and other small industries which swarm in the outskirts of all great cities. Over-production means merely and simply a want of purchasing powers amid the workers. And the same want of purchasing powers of the workers was felt everywhere on the Continent during the years 1885-1887.

After the bad years were over, a sudden revival of international trade took place; and, as the British exports rose in four years (1886 to 1890) by nearly 24 percent, it began to be said that there was no reason for being alarmed by foreign competition; that the decline of exports in 1885-1887 was only temporary, and general in Europe; and that England, now as of old, fully maintained her dominant position in the international trade. It is certainly true that if we consider exclusively the money value of the exports for the years 1876 to 1895, we see no permanent decline, we notice only fluctuations. British exports, like commerce altogether, seem to show a certain periodicity. They fell from £201,000,000 sterling in 1876 to £192,000,000 in 1879, then they rose again to £241,000,000 in 1882, and fell down to £213,000,000 in 1886; again they rose to £264,000,00n in 1890, but fell again, reaching a minimum of £216,000,000 in 1894, to be followed next year by a slight movement upwards.

This periodicity being a fact, Mr. Giffen could make light in 1886 of "German competition" by showing that exports from the United Kingdom had not decreased. It can even be said that, per head of population, they had remained unchanged until 1904, undergoing only the usual ups and downs.* However, when we come to consider the quantities exported, and compare them with the money value of the exports, even Mr. Giffen had to acknowledge that the prices of 1883 were so low in comparison with those of 1873 that in order to reach the same money value the United Kingdom would have had to export four pieces of cotton instead of three, and eight or ten tons of metallic goods instead of six. " The aggregate of British foreign trade, if valued at the prices of ten years previously, would have amounted to £861,000,000 instead of £667,000,000," we were told by no less an authority than the Commission on Trade Depression.

It might, however, be said that 1873 was an exceptional year, owing to the inflated demand which took place after the Franco-German war. But the same downward movement continued for a number of years. Thus, if we take the figures given in the Statesman's Year-book, we see that while the United Kingdom exported, in 1883, 4,957,000,000 yards of piece goods (cotton, woolen and linen) and 316,000,000 lb. of yarn in order to reach an export value of £104,000,000, the same country had to export, in 1896, no less than 5,478,000,000 yards of the same stuffs and 330,000,000 lb. of yarn in order to realize £99,700,000 only. And the figures would have appeared still more unfavorable if we took the cottons alone. True, the conditions improved during the last ten years, so that in 1906 the exports were similar to those of 1873; and they were better still in 1911, which was a year of an extraordinary foreign trade, when 7,041,000,000 yards of stuffs and 307,000,000 lb. of yarn were exported--the two being valued at £163,400,000. However, it was especially the yarn which kept the high prices, because it is the finest sorts of yarn which are now exported. But the great profits of the years 1873-1880 are irretrievably gone.

We thus see that while the total value of the exports from the United Kingdom, in proportion to its growing population, remains, broadly speaking, unaltered for the last thirty years, the high prices which could be got for the exports thirty years ago, and with them the high profits, are gone. And no amount of arithmetical calculations will persuade the British manufacturers that such is not the case. They know perfectly well that the home markets grow continually overstocked; that the best foreign markets are escaping; and that in the neutral markets Britain is being undersold. This is the unavoidable consequence of the development of manufactures all over the world. (See Appendix J.)

Great hopes were laid, some time ago, in Australia as a market for British goods; but Australia will soon do what Canada already does. She will manufacture. And the colonial exhibitions, by showing to the " colonists " what they are able to do, and how they must do, are only accelerating the day when each colony fara da se in her turn. Canada and India aleady impose protective duties on British goods. As to the much-spoken-of markets en the Congo, and Mr. Stanley's calculations and promises of a trade amounting to £ 26,000,000 a year if the Lancashire people supply the Africans with loin-cloths, such promises belong to the same category of fancies as the famous nightcaps of the Chinese which were to enrich England after the first Chinese war. The Chinese prefer their own home-made nightcaps; and as to the Congo people, four countries at least are already competing for supplying them with their poor dress: Britain, Germany, the United States, and, last but not least, India.

There was a time when this country had almost the monopoly in the cotton industries; but already in 1880 she possessed only 55 percent of all the spindles at work in Europe, the United States and India (40,000,000 out of 72,000,000), and a little more than one-half of the looms (550,000 out of 972,000). In 1893 the proportion was further reduced to 49 percent of the spindles (45,300,000 out of 91,340,000), and now the United Kingdom has only 41 percent of all the spindles.* It was thus losing ground while the others were winning. And the fact is quite natural: it might have been foreseen. There is no reason why Britain should always be the great cotton manufactory of the world, when raw cotton has to be imported into this country as elsewhere. It was quite natural that France, Germany, Italy, Russia, India, Japan, the United States, and even Mexico and Brazil, should begin to spin their own yarns and to weave their own cotton stuffs. But the appearance of the cotton industry in a country, or, in fact, of any textile industry, unavoidably becomes the starting-point for the growth of a series of other industries; chemical and mechanical works, metallurgy and mining feel at once the impetus given by a new want. The whole of the home industries, as also technical education altogether, must improve in order to satisfy that want as soon as it has been felt.

What has happened with regard to cottons is going on also with regard to other industries. Great Britain, which stood in 1880 at the head of the list of countries producing pig-iron, came in 1904 the third in the same list, which was headed by the United States and Germany; while Russia, which occupied the seventh place in 1880, comes now fourth, after Great Britain.¹⁷ Britain and Belgium have no longer the monopoly of the woolen trade. Immense factories at Verviers are silent; the Belgian weavers are misery-stricken, while Germany yearly increases her production of woolens, and exports nine times more woolens than Belgium. Austria has her own woolens and exports them, Riga, Lodz, and Moscow supply Russia with fine woolen cloths; and the growth of the woolen industry in each of the last-named countries calls into existence hundreds of connected trades.

For many years France has had the monopoly of the silk trade. Silkworms being reared in Southern France, it was quite natural that Lyons should grow into a center for the manufacture of silks. Spinning, domestic weaving, and dyeing works developed to a great extent. But eventually the industry took such an extension that home supplies of raw silk became insufficient, and raw silk was imported from Italy, Spain and Southern Austria, Asia Minor, the Caucasus and Japan, to the amount of from [ £9,000,000 to £11,000,000 in 1875 and 1876, while France had only £800,000 worth of her own silk. Thousands of peasant boys and girls were attracted by high wages to Lyons and the neighboring district; the industry was prosperous.

However, by-and-by new centers of silk trade grew up at Basel and in the peasant houses round Zurich. French emigrants imported the trade into Switzerland, and it developed there, especially after the civil war of 1871. Then the Caucasus Administration invited French workmen and women from Lyons and Marseilles to teach the Georgians and the Russians the best means of rearing the silkworm, as well as the whole of the silk trade; and Stavropol became a new center for silk weaving. Austria and the United States did the same; and what are now the results?

During the years 1872 to 1881 Switzerland more than doubled the produce of her silk industry; Italy and Germany increased it by one-third; and the Lyons region, which formerly manufactured to the value of 454 million francs a year, showed in 1887 a return of only 378 millions. The exports of Lyons silks, which reached an average of 425,000,000 francs in 1855-1859, and 460,000,000 in 1870-1874, fell down to 233,000,000 in 1887. And it is reckoned by French specialists that at present no less than one-third of the silk stuffs used in France are imported from Zurich, Crefeld, and Barmen. Nay, even Italy, which has now 191,000 persons engaged in the industry, sends her silks to France and competes with Lyons.,

The French manufacturers may cry as loudly as they like for protection, or resort to the production of cheaper goods of lower quality; they may sell 3,250,000 kilograms of silk stuffs at the same price as they sold 2,500,000 in 1855-1859--they will never again regain the position they occupied before. Italy, Switzerland, Germany, the United States and Russia have their own silk factories, and will import from Lyons only the highest qualities of stuffs. As to the lower sorts, a foulard has become a common attire with the St. Petersburg housemaids, because the North Caucasian domestic trades supply them at a price which would starve the Lyons weavers. The trade has been decentralized, and while Lyons is still a center for the higher artistic silks, it will never be again the chief center for the silk trade which it was thirty years ago.

Like examples could be produced by the score. Greenock no longer supplies Russia with sugar, because Russia has plenty of her own at the same price as it sells at in England. The watch trade is no more a specialty of Switzerland: watches are now made everywhere. India extracts from her ninety collieries two-thirds of her annual consumption of coal. The chemical trade which grew up on the banks of the Clyde and Tyne, owing to the special advantages offered for the import of Spanish pyrites and the agglomeration of such a variety of industries along the two estuaries, is now in decay. Spain, with the help of English capital, is beginning to utilize her own pyrites for herself; and Germany has become a great center for the manufacture of sulfuric acid and soda--nay, she already complains about over-production.

But enough! I have before me so many figures, all telling the same tale, that examples could be multiplied at will. It is time to conclude, and, for every unprejudiced mind, the conclusion is self-evident. Industries of all kinds decentralize and are scattered all over the globe; and everywhere a variety, an integrated variety, of trades grows, instead of specialization. Such are the prominent features of the times we live in. Each nation becomes in its turn a manufacturing nation; and the time is not far off when each nation of Europe, as well as the United States, and even the most backward nations of Asia and America, will themselves manufacture nearly everything they are in need of. Wars and several accidental causes may check for some time the scattering of industries: they will not stop it; it is unavoidable. For each new-comer the first steps only are difficult. But, as soon as any industry has taken firm root, it calls into existence hundreds of other trades; and as soon as the first steps have been made, and the first obstacles have been overcome, the industrial growth goes on at an accelerated rate.

The fact is so well felt, if not understood, that the race for colonies has become the distinctive feature of the last twenty years. Each nation will have her own colonies. But colonies will not help. There is not a second India in the world, and the old conditions will be repeated no more. Nay, some of the British colonies already threaten to become serious competitors with their mother country; others, like Australia, will not fail to follow the same lines. As to the yet neutral markets, China will never be a serious customer to Europe: she can produce much cheaper at home; and when she begins to feel a need for goods of European patterns, she will produce them herself. Woe to Europe, if on the day that the steam engine invades China she is still relying on foreign customers! As to the African half-savages, their misery is no foundation for the well-being of a civilized nation.

Progress must be looked for in another direction. It is in producing for home use. The customers for the Lancashire cottons and the Sheffield cutlery, the Lyons silks and the Hungarian flour-mills, are not in India, nor in Africa. The true consumers of the produce of our factories must be our own populations. And they can be that, once we organize our economical life so that they might issue from their present destitution. No use to send floating shops to New Guinea with British or German millinery, when there are plenty of would-be customers for British millinery in these very islands, and for German goods in Germany. Instead of worrying our brains by schemes for getting customers abroad, it would be better to try to answer the following questions: Why the British worker, whose industrial capacities are so highly praised in political speeches; why the Scotch crofter and the Irish peasant, whose obstinate labors in creating new productive soil out of peat bogs are occasionally so much spoken of, are no customers to the Lancashire weavers, the Sheffield cutlers and the Northumbrian and Welsh pitmen? Why the Lyons weavers not only do not wear silks, but sometimes have no food in their attics ? Why the Russian peasants sell their corn, and for four, six, and sometimes eight months every year are compelled to mix bark and auroch grass to a handful of flour for baking their bread ? Why famines are so common amid the growers of wheat and rice in India?

Under the present conditions of division into capitalists and laborers, into property-holders and masses living on uncertain wages, the spreading of industries over new fields is accompanied by the very same horrible facts of pitiless oppression, massacre of children, pauperism, and insecurity of life. The Russian Fabrics Inspectors' Reports, the Reports of the Plauen Handelskammer, the Italian inquests, and the reports about the growing industries of India and Japan are full of the same revelations as the Reports of the Parliamentary Commissions of 1840 to 1842, or the modern revelations with regard to the "sweating system" at Whitechapel and Glasgow, London pauperism, and York unemployment. The Capital and Labor problem is thus universalized; but, at the same time, it is also simplified. To return to a state of affairs where corn is grown, and manufactured goods are fabricated, for the use of those very people who grow and produce them-- such will be, no doubt, the problem to be solved during the next coming years of European history. Each region will become its own producer and its own consumer of manufactured goods. But that unavoidably implies that, at the same time, it will be its own producer and consumer of agricultural produce; and that is precisely what I am going to discuss next.

Footnotes

¹ During the census of 1902, there were in Austria 1,408,000 industrial establishments, with 1,787,000 horse-power, giving occupation to 4,049,300 work people; 1,128,000 work people were engaged in manufacturer in Hungary.

² The net imports of raw cotton reached 1,180,000 cwts. in 1885, and 4,120,000 cwts, in 1908; the number of spindles grew from 880,000 in 1877 to 3,800,000 in 1907. The whole industry has grown up since 1859. In 1910 no less than 358,200 tons of pig-iron and 671,000 tons of steel were produced in Italy. The exports of textiles reached the following values in 1905-1910: Silks, from £17,800,000 to £24,794,000-cottons £4,430,000 to £5,040,000; woolens, from £440,000 to £1.429.000.

³Times August 27, 1912.

⁴The Economist, 12th May, 1894, p. 9: "A few years ago the Orizaba mills used entirely imported raw cotton; but now they use homegrown and home-spun cotton as much as possible."

⁵Annuario Estadistico, 1911. They consumed 34,700 tons of raw cotton, and, produced 13,936,300 pieces of cotton goods, and 554,000 cwts. of yarn.

⁶ Schulze Gawernitz, The Cotton Trade, etc., p. 123.

⁷ In 1882 they had 5,633 looms and 95,937 spindles. Thirteen years later these figures were already doubled--there being 10,600 looms and 216,000 spindles. Now, or rather in 1909-1910, we find 60 jute mills, with 31,420 looms, 645,700 spindles, and 204,000 work people. The progress realized in the machinery is best seen from these figures. The exports of jute stuffs from India, which were only £1,543,870 in 1884-1885, reached £11,333,000 in 1910-1911. (See Appendix H.)

⁸Textile Recorder, 15th October, 1888.

⁹ 39,200,000 Ib. of yarn were imported in 1886 as against 6,435,000 Ib. of home-spun yarn. In 1889 the figures were 66,633,000 Ib. imported and 26,809,000 Ib. home-spun.

¹⁰ In 1910 the imports of cotton and woolens were only £2,650,500, while the exports of cotton yarn, cotton shirtings, and silk manufactures reached a value of £8,164,800.

¹¹ The mining industry has grown as follows:--Copper extracted: 2,407 tons in 1875, 49,000 in 1909. Coal: 567,200 tons in 1875; 15,635,000 in 1909. Iron: 3,447 tons in 1875 15,268 in 1887; 65,000 in 1909. (K. Rathgen, Japan's Volkwirthschaft und Staatshaushaltung, Leipzig, 1891; Consular Reports.)

¹² Workers employed in manufacturing industries: 2,054,000 in 1870, 4,712,600 in 1890, and 6,723,900 in 1905 (including salaried officials and clerks). Value of produce: 3,385,861,000 dollars in 1870, 9,372,437,280 dollars in 1890, and 16,866,707,000 in 1905. Yearly production per head of workers: 1,648 dollars in 1870, 1,989 dollars in 1890, and 2,614 dollars in 1905.

¹³ About the cotton industry in the United States, see Appendix I.

¹⁴ It was from 7,255,076 to 9,811,620 tons of pig-iron during the years 1890-94, and 27,303,600 long tons in 1910 ( £85,000,000 worth). The total value of products of the steel works and rolling mills reached in 1909 the immense value of £197,144,500. In the Statesman's Year-book for the years 1910-1912, the reader may find most striking figures concerning the rapid growth of the iron and steel industry in the States. We have nothing parallel to it in Europe.

¹⁵ The largest output of one blast-furnace in Great Britain does not exceed 750 tons in the week, while in America it had reached 2000 tons" (Nature, 19th Nov., 1891, p. 65). In 1909 the Bessemer steel plants had 99 converters; total daily capacity of ingots or direct castings, double turn, in 1909, 45,983 tons.

¹⁶ J.R. Dodge, Farm and Factory: Aids to Agriculture from other Industries, New York and London, 1884, p. 111. I can but highly recommend this little work to those interested in the question.

¹⁷ J. Stephen Jeans, The Iron Trade of Great Britain (London, Methuen), 1905, p. 46. The reader will find in this interesting little work valuable data concerning the growth and improvement of the iron industry in different countries.