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THE AMERICAN
.**..-
EMPIRE
By
SCOTT NEARING
Author of
“Wages in the United States."
"Income”
"Financing the Wage-Earner's Family”
“Anthracite”
"Poverty and Riches,” etc.
NEW YORK
THE RAND SCHOOL OF SOCIAL SCIENCE
7 EAST 15TH STREET
1921
All rights reserved
Copyright, 1921,
by the
RAND SCHOOL OF SOCIAL SCIENCE
First Edition, January, 1921
Second Edition, February, 1921
ad
without
Sociology
CONTENTS
Megrimite
1-2-24
9727
PART I
WHAT IS AMERICA?
CHAPTER
PAGE
.
I The Promise of 1776 . .
II The Course of Empire ..
. . . .
....
7
14
PART II
THE FOUNDATIONS OF EMPIRE.
A. THE CONQUEST OF AMERICA.
III
Subjugating the Indians .
25
.
.
.
.
IV Slavery for a Race . . . . . . . .
V Winning the West . . . . . . . .
VI The Beginnings of World Dominion . . .
•
B. PLUTOCRACY.
74
VII The Struggle for Wealth and Power ..
VIII Their United States . . . . . . .
IX The Divine Right of Property ...
103
CONTENTS—Continued
PART III
MANIFEST DESTINY.
CHAPTER
PAGE
X Industrial Empires . . . . . . . 120
XI The Great War. .......143
XII The Imperial Highroad ..'.... 158
PART IV
THE UNITED STATES—A WORLD EMPIRE.
XIII The United States as a World Competitor . 177
XIV The Partition of the Earth . . . . . 192
XV Pan-Americanism . . . . . . . . 202
XVI The American Capitalist and World Empire 218
m
PART V
THE CHALLENGE TO IMPERIALISM.
XVII The New Imperial Alignment
. . . . 229
XVIII The Challenge in Europe ...... 243
XIX The American Worker and World Empire . 256
The American Empire
I. THE PROMISE OF 1776
1. The American Republic
THE genius of revolution presided at the birth of the
American Republic, whose first breath was drawn amid the
economic, social and political turmoil of the eighteenth cen-
tury. The voyaging and discovering of the three preced-
ing centuries had destroyed European isolation and laid
the foundation for a new world order of society. The In-
dustrial Revolution was convulsing England and threaten-
ing to destroy the Feudal State. Western civilization, in
the birthpangs of social revolution, produced first the Amer-
ican and then the French Republic.
Feudalism was dying! Divine right, monarchy, aris-
tócracy, oppression, despotism, tyranny—these and all
other devils of the old world order were bound for the
limbo which awaits outworn, discredited social institutions.
The Declaration of Independence officially proclaimed the
new order, -challenging “divine right” and maintaining
that “all men are created equal; that they are endowed
by their Creator with certain unalienable rights; that
among these are life, liberty and the pursuit of happiness.
That to secure these rights, governments are instituted
among men, deriving their just powers from the consent
of the governed."
Life, liberty and happiness were the heritage of the hu-
man race, and “whenever any form of government becomes
destructive of these ends, it is the right of the people to
alter or abolish it, and to institute a new government lay-
ing its foundations on such principles, and organizing its
THE AMERICAN EMPIRE
powers in such form, as to them shall seem likely to effect
their safety and happiness.”
Thus the rights of the people were declared superior to
the privileges of the rulers; revolution was justified; and
the principles of eighteenth century individualism were
made the foundation of the new political state. Aristoc-
racy was swept aside and in its stead democracy was en-
throned.
2. The Yearning for Liberty
terhorted; statestire of the new into the eyerty as a
ms of her threshold. ina has so
The nineteenth century re-echoed with the language of
social idealism. Traditional bonds were breaking; men's
minds were freed; their imaginations were kindled; their
spirits were possessed by a gnawing hunger for justice and
truth.
Revolting millions shouted: “Liberty, Equality, Fra-
ternity!” Sages mused; philosophers analyzed; prophets
exhorted; statesmen organized toward this end.
Men felt the fire of the new order burning in their vitals.
It purged them. They looked into the eyes of their fellows
and saw its reflection, Dreaming of liberty as a maiden
dreams of her lover, humanity awoke suddenly, to find
liberty on the threshold.
Through the ages mankind has sought truth and justice.
Vested interests have intervened. The powers of the es-
tablished order have resisted, but the search has continued.
That eternal vigilance and eternal sacrifice which are the
price of liberty, are found wherever human society has left
a record. At one point the forces of light seem to be
winning. At another, liberty and truth are being ruth-
lessly crushed by the privileged masters of life. The
struggle goes on-eternally.
Liberty and justice are ideals that exist in the human
heart, but they are none the less real. Indeed, they are
in a sense more potent, lying thus in immortal embryo,
than they could be as tangible institutions. Institutions
THE AMERICAN EMPIRE
are brought into being, perfected, kept past their time of
highest usefulness and finally discarded. The hopes of men
spring eternally, spontaneously. They are the true social
immortality.
3. Government of the People
Feudalism as a means of organizing society had failed.
The newly declared liberties were confided to the newly
created state. It was political democracy upon which the
founders of the Republic depended to make good the
promise of 1776.
The American colonists had fled to escape economic,
political and religious tyranny in the mother countries.
They had drunk the cup of its bitterness in the long contest
with England over the rights of taxation, of commerce, of
manufacture, and of local political control. They had
their fill of a mastery built upon the special privilege of
an aristocratic minority. It was liberty and justice they
sought and democracy was the instrument that they selected
to emancipate themselves from the old forms of privilege
and to give to all an equal opportunity for life, liberty and
the pursuit of happiness.
Political demoeracy was to place the management of
community business in the hands of the people to give
them liberty in the control of public affairs. The highest
interest of democracy was to be the interest of the people.
There could be no higher interest because the people were
supreme. The people were to select the public servants;
direct their activities; determine public policy; prescribe
the law; demand its enforcement; and if need be assert
their superior authority over any part of the government,
not excepting the constitution.
1 "It is, Sir, the people's constitution, the people's government,
made for the people, made by the people, and answerable to the peo-
ple."---Daniel Webster's reply to Wayne, 1830. “Speeches and Ora-
tions." E. P. Whipple, Boston, Little, Brown and Co., p. 257.
10
THE AMERICAN EMPIRE
Democracy, in politics, was based on the idea that public
affairs could best be run by the public voice. However ex-
pert may be the hand that administers the laws, the hand
and the heart that renders the final decision in large ques-
tions must belong to the public.2
The people who laid the foundations for democracy in
France and the United States feared tyranny. They and
their ancestors had been, for centuries, the victims of
governmental despotism. They were on their guard con-
stantly against governmental aggression in any form. And
they, therefore, placed the strictest limitations upon the
powers that governments should enjoy.
Special privilege government was run by a special class,
the hereditary aristocracy-in the interest and for the
profit of that class. They held the wealth of the nation-
the land and lived comfortably upon its produce. They
never worked—no gentleman could work and remain a
gentleman. They carried on the affairs of the court-some-
times well, sometimes badly; maintained an extravagant
scale of social life; built up a vicious system of secret inter-
national diplomacy; commanded in time of war, and at all
times; levied rents and taxes which went very largely to
increase their own comfort and better their own position in
life. The machinery of government and the profits from
government remained in the hands of this one class.
Class government from its very nature could not be
other than oppressive. “All hereditary government over
a people is to them a species of slavery and representative
government is freedom.” “All hereditary government is
in its nature tyranny. ... To inherit a government is to
inherit the people as if they were flocks and herds.'' 3
2 Tom Paine held ardently to this doctrine, "It is always the in-
terest of a far greater number of people in a Nation to have things
right than to let them remain wrong; and when public matters are
open to debate, and the public judgment free, it will not decide
wrong unless it decides too hastily!” “Rights of Man," Part II,
Ch. 4.
3 “Rights of Man,” Thomas Paine. Part II, Chapter 3.
THE AMERICAN EMPIRE
11
4. The Source of Authority
The people were to be the source of authority in the
new state. The citizen was to have a voice because he was
an adult, capable of rendering judgment in the selection
of public servants and in the determination of public
policy.
All through history there had been men into whose hands
supreme power had been committed, who had carried this
authority with an astounding degree of wisdom and in-
tegrity. For every one who had comported himself with
such wisdom in the presence of supreme authority, there
were a score, or more likely a hundred, who had used this
power stupidly, foolishly, inefficiently, brutally or viciously.
Few men are good enough or wise enough to keep their
heads while they hold in their hands unlimited authority
over their fellows. The pages of human experience were
written full of the errors, failures, and abuses of which
such men so often have been guilty.
The new society, in an effort to prevent just such trans-
gressions of social well being, placed the final power to
decide public questions in the hands of the people. It was
not contended, or even hoped that the people would make
no mistakes, but that the people would make fewer mis-
takes and mistakes less destructive of public well-being
than had been made under class government. At least
this much was gained, that the one who abused power must
first secure it from those whom he proposed to abuse, and
must later exercise it unrestrained to the detriment of those
from whom the power was derived and in whom it still
resided.
The citizen was to be the source of authority. His word,
combined with that of the majority of his fellows, was final.
He delegated authority. He assented to laws which were
administered over all men, including himself. He accepts
the authority of which he was the source.
12
THE AMERICAN EMPIRE
I
5. The American Tradition
La When the promicountrigual opp liberty was they
baby.
This was the American tradition. This was the language
of the new, free world. Life, liberty and happiness;
popular sovereignity; equal opportunity. This, to the
people of the old countries was the meaning of America.
This was the promise of 1776.
When President Wilson went to Europe, speaking the
language of liberty that is taught in every American school-
room, the plain people turned to him with supreme con-
fidence. To them he was the embodiment of the spirit of
the West.
Native-born Americans hold the same idea. To them the
Declaration of Independence was a final break with the old
order of monarchical, imperial Europe. It was the
charter of popular rights and human liberties, establishing
once for all the principles of self-government and equal
opportunity.
The Statue of Liberty, guarding the great port of en-
trance to America, symbolizes the spirit in which foreigners
and natives alike think of her as the champion of the weak
and the oppressed; the guardian of justice; the standard-
bearer of freedom.
This spirit of America is treasured to-day in the hearts
of millions of her citizens. To the masses of the American
people America stands to-day as she always stood. They
believe in her freedom; they boast of her liberties; they
have faith in her great destiny as the leader of an emanci-
pated world. They respond, as did their ancestors, to the
great truths of liberty, equality, and fraternity that in-
spired the eighteenth century.
The tradition of America is a hope, a faith, a conviction,
a burning endeavor, centering in an ideal of liberty and
justice for the human race.
Patrick Henry voiced this ideal when, a passionate ap-
peal for freedom being interrupted by cries of “Treason,
THE AMERICAN EMPIRE
13
treason!” he faced the objector with the declaration, “If
this be treason, make the most of it!"
Eighteenth century Europe, struggling against religious
and political tyranny, looked to Anierica as the land of
Freedom. America to them meant liberty. “What Athens
was in miniature, America will be in magnitude," wrote
Tom Paine. "The one was the wonder of the ancient world;
the other is becoming the admiration, the model of the
present.” The Rights of Man,” Part II, Chapter 3.)
The promise of 1776 was voiced by men who felt a con-
suming passion for freedom; a divine discontent with any-
thing less than the highest possible justice; a hatred of
tyranny, oppression and every form of special privilege
and vested wrong. They yearned over the future and
hoped grandly for the human race.
THE AMERICAN EMPIRE
II. THE COURSE OF EMPIRE
1
1. Promise and Fulfillment
A VAST gulf yawns between the inspiring promise that
a handful of men and women made to the world in 1776,
and the fulfillment of that promise that is embodied in
twentieth century American life. The pre-war indifference
to the loss of liberty; the gradual encroachments on the
rights of free speech, and free assemblage and of free press;
the war-time suppressions, tyrannies, and denials of justice;
the subsequent activities of city, state, and national legis-
latures and executives in passing and enforcing laws that
provided for military training in violation of conscience,
the denial of freedom of belief, of thought, of speech, of
press and of assemblage-activities directed specifically to
the negation of those very principles of liberty which have
constituted so intimate a part of the American tradition of
freedom,-form'a contrast between the promise of 1776 and
the twentieth century fulfillment of that promise which is
brutal in its terrible intensity.
Many thoughtful Americans have been baffled by this con-
flict between the aims of the eighteenth century and the
accomplishments of the twentieth. The facts they admit.
For explanation, either they may say, “It was the war,”
implying that with the cessation of hostilities and the re-
turn to a peace basis, the situation has undergone a radical
change; or else they blame some individual or some organi-
zation for the extinction of American liberties.
Great consequences arise from great causes. A general
break-down of liberties cannot be attributed to individual
caprice nor to a particular legislative or judical act.
The denial of liberty in the United States is a matter of
of large import. No mayor, governor, president, legis-
lature, court, magnate, banker, corporation or trust, and
THE AMERICAN EMPIRE
15
no combination of these individuals and organizations could
arbitrarily destroy the American Republic. Underneath
personality and partisanship are working the forces which
have stripped the American people of their essential liber-
ties as the April sun strips the mountains of their snow.
No one can read the history of the United States since
the drafting of the Declaration of Independence without
being struck by the complete transformation in the forms
of American life. The Industrial Revolution which had
gripped England for half a century, made itself felt in the
United States after 1815. Steam, transportation, indus-
trial development, city life, business organization, expansion
across the continent-these are the factors that have made
of the United States a nation utterly apart from the nation
of which those who signed the Declaration of Independence
and fought the Revolution dreamed.
These economic changes have brought political changes.
The American Republic has been thrust aside. Above its
remains towers a mighty imperial structure,-the world of
business,--bulwarked by usage and convention; safe-
guarded by legislation, judical interprétation, and the
whole power of organized society. That structure is the
American Empire-as real to-day as the Roman Empire in
the days of Julius Caesar; the French Empire under the
Little Corporal, or the British Empire of the Great Com-
moner, William E. Gladstone.
Approved or disapproved; exalted or condemned; the
fact of empire must be evident even to the hasty observer.
The student, tracing its ramifications, realizes that the
structure has been building for generations.
2. The Characteristics of Empire
Many minds will refuse to accept the term "empire”
as applied to a republic. Accustomed to link "empire"
with "emperor," they conceive of a supreme hereditary
ruler as an essential part of imperial life. A little re-
THE AMERICAN EMPIRE
ther hanhan the PS a limited
flection will show the inadequacy of such a concept. "The
British Empire” is an official term, used by the British
Government, although Great Britian is a limited monarchy,
whose king has less power than the President of the United
States. On the other hand, eastern potentates, who ex-
ercise absolute sway over their tiny dominions do not rule
"empires."
Recent usage has given the term "empire" a very definite
meaning, which refers, not to an "emperor” but to certain
relations between the parts of a political or even of an
economic organization. The earlier uses of the word “em-
pire” were, of course, largely political. Even in that
political sense, however, an "empire” does not necessarily
imply the domain of an “emperor.”
According to the definition appearing in the "New Eng-
lish Dictionary” wherever "supreme and extensive politi-
cal dominion” is exercised “by a sovereign state over its
dependencies” an empire exists. The empire is “an
aggregaton of subject territories ruled over by a sovereign
state.” The terms of the definition are political, but it
leaves the emperor entirely out of account and makes an
empire primarily a matter of organization and not of
personality.
During the last fifty years colonialism, the search for
foreign markets, and the competition for the control of
"undeveloped countries has brought the words "empire"
and “imperialism" into a new category, where they relate,
not to the ruler-be he King or Emperor-but to the ex-
tension of commercial and economic interests. The "fi-
nancial imperialism" of F. C. Howe and the “imperialism"
of J. A. Hobson are primarily economic and only in-
cidentally political.
"Empire” conveys the idea of widespread authority,
dominion, rule, subjugation. Formerly it referred to
political power; to-day it refers to economic power. In
either case the characteristics of empire are,-
1. Conquered territory.
THE AMERICAN EMPIRE
17
2. Subject peoples.
3. An imperial or ruling class.
4. The exploitation of the subject peoples and the con-
quered territory for the benefit of the ruling class.
Wherever these four characteristics of imperial organi-
zation exist, there is an empire, in all of its essential
features. They are the acid-test, by which the presence of
empire may be determined.
Names count for nothing. Rome was an empire, while
she still called herself a republic. Napolean carried on his
imperial activities for years under the authority of Repub-
lican France. The existence of an empire depends, not
upon the presence of an "emperor'' but upon the presence
of those facts which constitute Empire,-conquered terri-
tory; subject peoples; an imperial class; exploitation by and
for this class. If these facts exist in Russia, Russia is an
empire; if they are found in Germany, Germany is an em-
pire; if they appear in the United States, the United States
is an empire none the less surely,--traditions, aspirations
and public conviction to the contrary notwithstanding.
3. The Preservation of Empire
The first business of an imperial class is the preservation
of the empire to which it owes its advantages and privileges.
Therefore, in its very essence, imperialism is opposed to
popular government. “The greatest good to the greatest
number" is the ideal that directs the life of a self-govern-
ing community. "The safety and happiness of the ruling
class” is the first principle of imperial organization.
Imperialism is so generally recognized and so widely
accepted as a mortal foe of popular government that the
members of an imperial class, just rising into power, are
always careful to keep the masses of the people ignorant of
THE AMERICAN EMPIRE
the true course of events. This necessity explains the long
period, in the history of many great empires, when the
name and forms of democracy were preserved, after the
imperial structure had been established on solid foundations.
Slow changes, carefully directed and well disguised, are
necessary to prevent outraged peoples from rising against
an imperial order when they discover how they have been
sold into slavery. Even with all of the safeguards, under
the control of the ablest statesmen, Caesar frequently meets
his Brutus.
The love of justice; the yearning for liberty; the sense of
fair play; the desire to extend opportunity, all operate
powerfully upon those to whom the principles of self-
government are dearest, leading them to sacrifice position,
economic advantage, and sometimes life itself for the sake
of the principles to which they have pledged their faith.
Therein lies what is perhaps one of the most essential
differences between popular government and empire. The
former rests upon certain ideas of popular rights and
liberties. The latter is a weapon of exploitation in the
hands of the ruling class. Popular government lies in the
hopes and beliefs of the people. Empire is the servant of
ambition and the shadow of greed. Popular government
has been evolved by the human race at an immense
sacrifice during centuries of struggle against the forms and
ideas that underly imperialism. Since men have set their
backs on the past and turned their faces with resolute hope
to the future, empire has repelled them, while democracy
has called and beckoned.
Empires have been made possible by “bread and cir-
cuses”; by appealing to an abnormally developed sense of
patriotism; by the rule of might where largess and cajolery
have failed. Rome, Germany and Britain are excellent ex-
amples of these three methods. In each case, millions of
citizens have had faith in the empire, believing in its
promise of glory and of victory; but on the other hand, this
belief could be maintained only by a continuous propa-
gandam-triumphs in Rome, school-books and "boilerplate"
THE AMERICAN EMPIRE
19
in Germany and England. Even then, the imperial class is
none too secure in its privileges. Always from the abysses
of popular discontent, there arises some Spartacus, some
Liebknecht, some Smillie, crying that “the future belongs
to the people.”
The imperial class, its privileges unceasingly threatened
by the popular love of freedom-devotes not a little atten-
tion to the problem of "preserving law and order” by
suppressing those who speak in the name of liberty, and
by carrying on a generous advertising campaign, the object
of which is to persuade the people of the advantages which
they derive from imperial rule. *******
During the earlier stages in the development of empire,
the imperial class is able to keep itself and its designs in the
background. As time passes, however, the power of the
imperialist becomes more and more evident, until some
great crisis forces the empire builders to step out into the
open. They then appear as the frank apologists, spokes-
men and defenders of the order for which they have so
faithfully labored and from which they expect to gain so
much.
Finally, the ambition of some aggressive leader among
the imperialists, or a crisis in the affairs of the empire leads
to the next step—the appointment of a “dictator,” “su-
preme ruler” or “emperor.” This is the last act of the
imperial drama. Henceforth, the imperial class divides its
attention between,-
1. The suppression of agitation and revolt among the
people at home;
2. Maintaining the imperial sway over conquered terri-
tory;
3. Extending the boundaries of the empire and
4. The unending struggle between contending factions
of the ruling class for the right to carry on the work
of exploitation at home and abroad,
20
THE AMERICAN EMPIRE
4. The Price of Empire
Since the imperial or ruling class is willing to go to any
lengths in order to preserve the empire upon which its
privileges depend, it follows that the price of empire must
be reckoned in the losses that the masses of the people
suffer while safeguarding the privileges of the few.
As a matter of course, conquered and dependent people
pay with their liberty for their incorporation into the em-
pire that holds dominion over them. On any other basis,
empire is unthinkable. Indeed the terms “dependencies,"
“domination,” and “subject" carry with them only one
possible implication-the subordination or extinction of the
liberties of the peoples in question.
The imperial class-a minority-depends for its con-
tinued supremacy upon the ownership of some form of
property, whether this property be slaves, or land, or in-
dustrial capital. As Veblen puts it: "The emergence
of the leisure class coincides with the beginning of owner-
ship.” (“Theory of the Leisure Class,” T. Veblen, New
York. B. W. Huebsch, 1899, p. 22.) Necessarily, there-
fore, the imperial class will sacrifice the so-called human or
personal rights of the home population to the protection of
its property rights. Indeed the property rights come to be
regarded as the essential human rights, although there is
but a small minority of the community that can boast of the
possession of property.
The superiority of ruling class property rights over the
personal rights and liberties of the inhabitants in a subject
territory is taken as a matter of course. Even in the home
country, where the issue is clearly made, the imperial class
will sacrifice the happiness, the health, the longevity, and
the lives of the propertyless class in the interest of law
and order” and “the protection of property.” The stories
of the Roman populace; of the French peasants under
Louis XIV; of the English factory workers (men, women
and children) during the past hundred years, and of the low
skilled workers in the United States since the Civil War,
THE AMERICAN EMPIRE
21
furnish ample proof of the correctness of this contention.
The life, liberty and happiness of the individual citizen is
a matter of small importance so long as the empire is saved.
A crisis in imperial affairs is always regarded, by the
ruling class, as a legitimate reason for curtailing the rights
of the people. Under ordinary circumstances, the imperial
class will gain rather than lose from the exercise of “popu-
lar liberties.” Indeed, the exercise of these liberties is of
the greatest assistance in convincing the people that they
are enjoying freedom, and thus keeping them satisfied with
their lot. But in a period of turmoil, with men's hearts
stirred, and their souls aflamed with conviction and ideal-
ism, there is always danger that the people may exercise
their “unalienable right” to "alter or abolish” their form
of government. Consequently, during a crisis, the im-
perial class takes temporary charge of popular liberties.
Every great empire engaged in the recent war passed
through such an experience. In each country the ruling
class announced that the war was a matter of life and

are enjoyin But in a ne aflameda
was denied; men were conscripted against will and con-
science; constitutions were thrust aside ; laws “slumbered”;
writers and thinkers were jailed for their opinions; food
was rationed; industries were controlled--all in the interest
of “winning the war.” After the war was won, the victors
practiced an even more rigorous suppression while they
were “making the peace.” Then followed months and
years of protests and demands, until, one by one, the
liberties were retaken by the people or else the war-tyranny,
once firmly established, became a part of “the heritage of
empire.” In such cases, where liberties were not regained,
the plain people learned to do without them.
Liberty is the price of empire. Imperialism presupposes
that the people will be willing, at any time, to surrender
their rights” at the call of the rulers.
once ties were retail and dem
22
THE AMERICAN EMPIRE
5. The Universality of Empire
Imperialism is not new, nor is it confined to one nation
or to one race. On the contrary it is as old as history and
as wide as the world.
Before Rome, there was Carthage. Before Carthage,
there were Greece, Macedonia, Egypt, Assyria, China.
Where history has a record, it is a record of empire.
During modern times, international affairs have been
dominated by empires. The great war was a war between
empires. During the first three years, the two chief con-
testants were the British Empire on the one hand and the
German Empire on the other. Behind these leaders were
the Russian Empire, the Italian Empire, the French Em-
pire, and the Japanese Empire.
The Peace of Versailles was a peace between empires.
Five empires dominated the peace table-Great Britain,
France, Italy, Japan and the United States. The avowedly
anti-imperial nations of Europe—Russia and Hungary-
were not only excluded from the deliberations of the Peace
Table, but were made the object of constant diplomatic,
military and economic aggression by the leading imperial-
ist nations.
6. The Evolution of Empire
Empires do not spring, full grown, from the surroundings
of some great historic crisis. Rather they, like all other
social institutions, are the result of a long series of changes
that lead by degrees from the pre-imperial to the imperial
stage. Many of the great empires of the past two thousand
years have begun as republics, or, as they are sometimes
called, “democracies,” and the processes of transformation
from the republican to the imperial stage have been so
gradual that the great mass of the people were not aware
that any change had occurred until the emperor ascended
the throne.
THE AMERICAN EMPIRE
The development of empire is of necessity a slow process.
There are the dependent people to be subjected; the terri-
tory to conquered; the imperial class to be built up. This
last process takes, perhaps, more time than either of the
other two. Class consciousness is not created in a day. It
requires long experience with the exercise of imperial power
before the time has come to proclaim an emperor, and forci-
bly to take possession of the machinery of public affairs.
7. The United States and the Stages of Empire
Any one who is familiar with its history will realize at
once that the United States is passing through some of the
more advanced stages in the development of empire. The
name “Republic” still remains; the traditions of the Re-
public are cherished by millions; the republican forms are
almost intact, but the relations of the United States to
its conquered territory and its subject peoples; the rapid
maturation of the plutocracy as a governing class or caste;
the shamelessness of the exploitation in which the rulers
have indulged; and the character of the forces that are
now shaping public policy, proclaim to all the world the
fact of empire.
The chief characteristics of empire exist in the United
States. Here are conquered territory; subject peoples;
an imperial, ruling class, and the exploitation by that class
of the people at home and abroad. During generations
the processess of empire have been working, unobserved,
in the United States. Through more than two centuries the
American people have been busily laying the foundations
and erecting the imperial structure. For the most part,
they have been unconscious of the work that they were
doing, as the dock laborer, is ordinarily unconscious of his
part in the mechanism of industry. Consciously or uncon-
sciously, the American people have reared the imperial
structure, until it stands, to-day, imposing in its grandeur,
upon the spot where many of the founders of the American
government hoped to see a republic.
THE AMERICAN EMPIRE
The entrance of the United States into the war did not
greatly alter the character of the forces at work, nor did
it in any large degree change the direction in which the
country was moving. Rather, it brought to the surface
of public attention factors of American life that had been
evolving unnoticed, for generations.
The world situation created by the war compelled the
American imperial class to come out in the open and to oc-
cupy a position that, while wholly inconsistent with the
traditions of American life, is nevertheless in keeping
with the demands of imperial necessity. The ruling class
in the United States has taken a logical step and has made
a logical stand. The masters of American life have done
the only thing that they could do in the interests of the
imperial forces that they represent. They are the victims,
as much as were the Kaiser and the Czar on the one hand,
and the Belgians and the Serbs on the other, of that im-
perial necessity that knows no law save the preservation of
its own most sacred interests.
Certain liberal American thinkers have taken the stand
that the incidents of 1917-1918 were the result of the
failure of the President, and of certain of his advisers, to
follow the theories which he had enunciated, and to stand
by the cause that he had espoused. These critics over-
look the incidental character of the war as a factor in
American domestic policy. The war never assumed any.
thing like the importance in the United States that it did
ated a furore, but underneath the big fact staring the
administration in the face was the united front of the
business interests, and their organized demands for action.
The far-seeing among the business men realized that the
plutocratic structure the world over was in peril, and that
the fate of the whole imperial régime was involved in the
European struggle. The Russian Revolution of March
1917 was the last straw. From that time on the entrance
of the United States into the war became a certainty as
the only means of "saving (capitalist) civilization."
THE AMERICAN EMPIRE
25
The thoughtful student of the situation in the United
States is not deceived by personalities and names. He
realizes that the events of 1917-1918 have behind them
generations of causes which lead logically to just such
results; that he is witnessing one phase of a great process
in the life of the American nation--a process that is old in
its principles yet ever new in its manifestations.
Traditional liberties have always given way before im-
perial necessity. An examination of the situation in which
the ruling class of the United States found itself in 1917,
and of the forces that were operating to determine public
policy, must convince even the enthusiast that the occur-
rences of 1917 and the succeeding years were the logical
outcome of imperial necessity. To what extent that ex-
planation will account for the discrepancy between the
promise of 1776 and the twentieth century fulfillment of
that promise must appear from a further examination of
the evidence.
THE AMERICAN EMPIRE
III. SUBJUGATING THE INDIANS
1. The Conquering Peoples
THE first step in the establishment of empire-the con-
quest of territory and the subjugation of the conquered
populations,—was taken by the people of the United States
at the time of their earliest settlements. They took the
step naturally, unaffectedly, as became the sons of their
fathers.
The Spanish, French and English who made the first
settlement in North America, were direct descendants of
the tribes that have swept across Europe and portions of
Asia during the past three or four thousand years. These
tribes, grouped on the basis of similarity in language under
the general term “Aryan,” hold a record of conquest that
fills the pages of written history.
Hunger; the pressure of surplus population; the inrush
of new hordes of invaders, drove them on. Ambition; the
love of adventure; the lure of new opportunities in new
lands, called them further. Meliorism,--the desire to better
the conditions of life for themselves and for their children
animated them. In later years the necessity of dispos-
ing of surplus wealth impelled them. Driven, lured,
coerced, these Aryan tribes have inundated the earth.
Pagsing beyond the boundaries of Europe, they have
crossed the seas into Africa, Asia, America and Australia.
Among the Aryans, after bitter strife, the Teutons have
attained supremacy. The “Teutonic Peoples” are the
English speaking inhabitants of the British Isles, the Ger-
man speaking inhabitants of Germany, Austria-Hungary
and Switzerland, the Flemish speaking inhabitants of Bel-
gium, the Scandinavian inhabitants of Sweden and Nor-
way and practically all of the inhabitants of Holland and
Denmark.” (“Encyclopedia Britannica."').
THE AMERICAN EMPIRE
27
This Teutonic domination has been established only by
the bitterest of struggles. During the time when North
America was being settled, the English dispossessed first
the Spanish and later the French. Since the Battle of
Waterloo—won by English and German troops; and the
Crimean War-won by British against Russian troops-
the Teutonic power has gone unchallenged and so it re-
mains to-day.
The dominant power in the United States for nearly two
centuries has been the English speaking power. Thus the
Americans draw their inspiration, not only from the Aryan,
but from the English speaking Teutons—the most aggres-
sive and dominating group among the Aryans.
Three hundred years ago the title to North America was
claimed by Spain, France and Great Britain. The land
itself was almost entirely in the hands of Indian tribes which
held the possession that according to the proverb, is “nine
points of the law."
The period of American settlement has witnessed the
rapid dispossession of the original holders, until, at the
present time, the Indians have less than two per cent of
the land area of the United States.
The conquest, by the English speaking whites, of the three
million square miles which comprise the United States has
been accomplished in a phenomenally short space of time.
Migration; military occupation; appropriation of the lands
taken from the “enemy;'' settlement, and permanent exploi-
tation—through all these stages of conquest the country
has moved.
The "Historical Register of the United States Army"
(F. B. Heitman, Washington, Govt. Print., 1903, vol. 2, pp.
298-300) contains a list of 114 wars in which the United
States has been engaged since 1775. The publication like-
wise presents a list of 8600 battles and engagments incident
1 The total number of square miles in Indian Reservations in 1918
was 53,490 as against 241,800 square miles in 1880. (Statistical
Abstract of the United States, 1918, p. 8.)
THE AMERICAN EMPIRE
The
Whippewa wars milition to which is with
to these 114 wars. Two of these wars were with England,
one with Mexico and one with Spain. These, together
with the Civil War and the War with Germany, consti-
tute the major struggles in which the United States has been
engaged. In addition to these six great wars there were the
numerous wars with the Indians, the last of which (with the
Chippewa) occurred in 1898. Some of these Indian “wars"
were mere policing expeditions. Others, like the wars with
the Northwest Indians, with the Seminoles and with the
Apaches, lasted for years and involved a considerable out-
lay of life and money.
When the Indian Wars were ended, and the handful of
red men had been crushed by the white millions, the Amer-
ican Indians, once possessors of a hunting ground that
stretched across the continent, found themselves in reser-
vations, under government tutelage, or else, abandoning
their own customs and habits of life, they accepted the
“pale-face' standards in preference to their own well-loved
traditions.
The territory flanking the Mississippi Valley, with its
coastal plains and the deposits of mineral wealth, is one
of the richest in the world. Only two other areas, China
and Russia, can compare with it in resources.
This garden spot came into the possession of the English
speaking whites almost without a struggle. It was as if
destiny had held a door tight shut for centuries and sud.
denly had opened it to admit her chosen guests.
History shows that such areas have almost always been
held by one powerful nation after another, and have been
the scene of ferocious struggles. Witness the valleys of the
Euphrates, the Nile, the Danube, the Po and the Rhine.
The barrier of the Atlantic saved North America.
Had the Mississippi Valley been in Europe, Asia or
Northern Africa, it would doubtless have been blood-soaked
for centuries and dominated by highly organized nations,
armed to the teeth. Lying isolated, it presented an almost
virgin opportunity to the conquering Teutons of Western
Europe.
THE AMERICAN EMPIRE
29
Freed by their isolated position from the necessity of
contending against outside aggression, the inhabitants of the
United States have expended their combative energies
against the weaker peoples with whom they came into imme-
diate contact,
1. The Indians, from whom they took the land and
wrested the right to exploit the resources of the con-
tinent;
2. The African Negroes who were captured and brought
to America to labor as slaves ;
3. The Mexicans, from whom they took additional slave
territory at a time when the institution of slavery was
in grave danger, and
4. The Spanish Empire from which they took foreign in.
vestment opportunities at a time when the business
interests of the country first felt the pressure of sur-
plus wealth.
Each of these four groups was weak. No one of them
could present even the beginnings of an effectual resistance
to the onslaught of the conquerors. Each in turn was
forced to bow the knee before overwhelming odds.
2. The First Obstacle to Conquest
The first obstacle to the spread of English civilization
across the continent of North America was the American
Indian. He was in possession of the country; he had a cul.
ture of his own; he held the white man's civilization in con-
tempt and refused to accept it. He had but one desire,-to
be let alone.
The continent was a "wilderness” to the whites. To
the Indians it was a home. Their villages were scattered
from the Atlantic to the Pacific, from the Gulf to Alaska;
they knew well its mountains, plains and rivers. A primi.
tive people, supporting themselves largely by hunting,
fishing, simple agriculture and such elemental manual arts
30
THE AMERICAN EMPIRE
as pottery and weaving, they found the vast stretches of
North America none too large to provide them with the
means of satisfying their wants.
The ideas of the Indian differed fundamentally from
those of the white man. Holding to the Eastern conception
which makes the spiritual life paramount, he reduced his
material existence to the simplest possible terms. He had
no desire for possessions, which he regarded-at the best-
as “only means to the end of his ultimate perfection." 2
To him, the white man's desire for wealth was incompre-
hensible and the white man's sedentary life was contempt-
ible. He must be free at all times to commune with
nature in the valleys, and at sunrise and sunset to ascend
the mountain peak and salute the Great Spirit.
The individual Indian-having no desire for wealth-
could not be bribed or bought for gold .as could the Euro-
pean. The leaders, democratically selected, and held by the
most enduring ties of loyalty to their tribal oaths, were
above the mercenary standards of European commerce
and statesmanship. Friendly, hospitable, courteous, gen-
not for sale.
The attitude of the Indian toward the land which the
white men coveted was typical of his whole relation with
white civilization. “Land ownership, in the sense in which
we use the term, was unknown to the Indians till the whites
came among them.”3 The land devoted to villages was
tribal property; the hunting ground surrounding the vil-
lage was open to all of the members of the tribe; between
the hunting grounds of different tribes there was a neutral
à family cultivated a patch of land, the neighbors did
not trespass. Among the Indians of the Southwest the
village owned the agricultural land and “periodically its
2 "The Indian of To-day,” C. A. Eastman. New York, Doubleday,
1915, p. 4.
3 "The Indian and His Problem," .F. E. Leupp. New York, Scrib-
ners, 1910, p. 23,
THE AMERICAN EMPIRE
governor, elected by popular vote, would distribute or
redistribute the arable acres among his constituents who
were able to care for them.” 4 The Indians believed that
the land, like the sunlight, was a gift of the Great Spirit
to his children, and they were as willing to part with the
one as with the other.
They carried their communal ideas still farther. Among
at his death to the whole tribe and were distributed among
the tribal members. Among the Alaskan Indians, no
man, during his life, could possess more than he needed
while his neighbor lacked. Food was always regarded as
common property. "The rule being to let him who was
hungry eat, wherever he found that which would stay the
cravings of his stomach."5 The motto of the Indian was
" To each according to his need."
Such a communist attitude toward property, coupled
with a belief that the land--the gift of the Great Spirit
-was a trust committed to the tribe, proved a source of
constant irritation to the white colonists who needed addi-
more imperative to increase the land area open for settle-
ment, and to such encroachments the Indian offered a stub-
born resistance.
The Indian would not-could not-part with his land,
neither would he work, as a slave or a wage-servant. Be-
fore such degradation he preferred death. . Other peoples
the negroes; the inhabitants of Mexico, Peru and the
West Indies; the Hindus and the Chinese-made slaves
or servants. The Indian for generations held out stolidly
against the efforts of missionaries, farmers and manufac-
turers alike to convert him into a worker.
The Indian could not understand the ideas of “pur-
chase," "sale" and "cash payment” that constitute essen-
țial features of the white man's economy. To him strength
4 Ibid., p. 24.
8 Ibid., p. 10.
.
32
THE AMERICAN EMPIRE
of limb, courage, endurance, sobriety and personal dignity
and reserve were infinitely superior to any of the com-
mercial virtues which the white men possessed.
This attitude of the Indian toward European standards
unwillingness to part with the land; and his refusal to
work, made it impossible to “assimilate" him, as other peo-
ples were assimilated, into colonial society. The individual
Indian would not demean himself by becoming a cog in the
white man's machine. He preferred to live and die in
the open air of his native hills and plains.
The Indian was an intense individualist-trained in a
school of experience where initiative and personal quali-
ties were the tests of survival. He placed the soles of his
moccasined feet firmly against his native earth, cast his
eyes around him and above him and melted harmoniously
into his native landscape.
Missionaries and teachers labored in vain-once an In-
dian, always an Indian. The white settlers pushed on
across mountain ranges and through valleys. Generations
came and went without any marked progress in bringing
the white men and the red men together. When the
Indian, in the mission or in the government school did
become “civilized,” he gave over his old life altogether
and accepted the white man's codes and standards. The
two methods of life were too far apart to make amalga-
mation possible.
dian, amountair without a red me overna
3. Getting the Land
The white man must have land! Population was grow-
alluring.
Everywhere, the Indian was in possession, and every-
where he considered the sale of land in the light of part-
ing with a birth-right. He was friendly at first, but he
had no sympathy with the standards of white civilization.
THE AMERICAN EMPIRE
33
For such a situation there was only one possible solution.
Under the plea that “necessity knows no law” the white
man took up the task of eliminating the Indian, with the
least friction, and in the most effective manner possible.
There were three methods of getting the land away from
the Indian--the easiest was by means of treaties, under
which certain lands lying along the Atlantic Coast were
turned over to the whites in exchange for larger terri-
tories west of the Mississippi. The second method was by
purchase. The third was by armed conquest. All three
methods were employed at some stage in the relations
between the whites and each Indian tribe.
The experience with the Cherokee Nation is typical of
the relation between the whites and the other Indian tribes.
(Annual Report of the Bureau of Ethnology. Vol. 5.
"The Cherokee Nation,” by Charles C. Royce.)
The Cherokee nation before the year 1650 was estab-
lished on the Tennessee River, and exercised dominion
over all the country on the east side of the Alleghany
Mountains, including the head-waters of the Yadkin, the
Catawba, the Broad, the Savannah, the Chattahoochee and
the Alabama. In 1775 there were 43 Cherokee towns cov-
ering portions of this territory. In 1799 their towns num-
bered 51.
Treaty relations between the whites and the Cherokees
began in 1721, when there was a peace council, held be-
tween the representatives of 37 towns and the authorities
of South Carolina. From that time, until the treaty made
with the United States government in 1866, the Cherokees
were gradually pushed back from their rich hunting
grounds toward the Mississippi valley. By the treaty of
1791, the United States solemnly guaranteed to the Chero-
kees all of their land, the whites not being permitted even
to hunt on them. In 1794 and 1804 new treaties were
negotiated, involving additional cessions of land. By the
treaty of 1804, a road was to be cut through the Cherokee
territory, free for the use of all United States citizens.
34
THE AMERICAN EMPIRE
An agitation arose for the removal of the Cherokees to
some point west of the Mississippi River. Some of the
Indians accepted the opportunity and went to Arkansas.
Others held stubbornly to their villages. Meanwhile white
hunters and settlers encroached on their land; white men
debauched their women, and white desperadoes stole their
stock. By the treaty of 1828 the United States agreed to
possess the Cherokees and to guarantee to them forever
several millions of acres west of Arkansas, and in addi-
tion a perpetual outlet west, and a “free and unmolested
use of all the country lying west of the western boundary
of the above described limits and as far west as the
sovereignty of the United States and their right of soil
extend” (p. 229). The Cherokees who had settled in
Arkansas agreed to leave their lands within 14 months.
By the treaty of 1836 the Cherokees ceded to the United
States all lands east of the Mississippi. There was con-
siderable difficulty in enforcing this provision but by de-
grees most of the Indians were removed west of the river.
In 1859 and 1860 the Commissioner of Indian affairs pre-
pared a survey of the Cherokee domain. This was op-
posed by the head men of the nation. By the Treaty of
1866 other tribes were quartered on land owned by the
Cherokees and railroads were run through their territory.
Diplomacy, money and the military forces had done
their work. The first treaty, made in 1721, found the
Cherokee nation in virtual possession of the mountainous
regions of Southeastern United States. The twenty-
fourth treaty (1866) left them on a tiny reservation, two
thousand miles from their former home. Those twenty-
four treaties had netted the State and Federal governments
81,220,374 acres of land (p. 378). To-day the Cherokee
Nation has 63,211 acres.
8"Referring to your inquiry of November 20, 1919, concerning the
Cherokee Indian Reservation, you are advised that the Cherokee In-
dian country in the northeastern part of Oklahoma aggregated 4,420,-
068 acres.
"Of said area 4,346,223 acres have been allotted in severalty to
the enrolled members of said Cherokee Indian Nation, Oklahoma.
THE AMERICAN EMPIRE
35
A great nation of proud, independent, liberty-loving
men and women, came into conflict with the whites of the
Carolinas and Georgia; with the state and national govern-
ments. “For two hundred years a contest involving their
very existence as a people has been maintained against the
unscrupulous rapacity of Anglo-Saxon civilization. By
degrees they were driven from their ancestral domain to
an unknown and inhabitable region” (p. 371). Now the
contest is ended. The white men have the land. The
Cherokees have a little patch of territory; government sup-
port; free schools and the right to accept the sovereignty
of the nation that has conquered them.
The theory upon which the whites proceeded in taking
the Indian lands is thus stated by Leupp,“Originally,
the Indians owned all the land ; later we needed most of it
for ourselves; therefore, it is but just that the Indians
should have what is left.”?
for ourselves whed all the stated by
4. The Triumph of the Whites
stance, hospitably or even reverentially welcomed by the
Indians, who regarded them as children of the Great White
Spirit. During the first bitter winters, it was the Indians
who fed the colonists from their supplies of grain; guided
Twenty-two thousand eight hundred and eighty acres were disposed
of as town lots, or reserved for railway rights of way, churches,
schools, cemeteries, etc., and the remaining area has been sold, or
otherwise disposed of as provided by law.
"The Cherokee tribal land in Oklahoma with the exception of the
possible title of said Nation to certain river beds has been disposed of.
"In reference to the Eastern band of Cherokees, you are advised
that said Indians who have been incorporated hold title in fee to
certain land in North Carolina, known as the Qualla Reservation and
certain other lands, aggregating 63,211 acres."-Letter from the
Office of Indian Affairs. Dec. 9, 1919, “In re Cherokee land."
7 "The Indian and His Problem," F. E. Leupp. New York, Scrib-
ners, 1910, p. 24.
36
THE AMERICAN EMPIRE
.
the sand deftrinket with whistisfied thate
knowledge of hunting, fishing and agriculture. The whites
retaliated with that cunning, grasping, bestial ferocity
which has spread terror through the earth during the past
five centuries.
In the early years, when the whites were few and the
Indians many, the whites satisfied themselves by debauch-
ing the red men with whiskey and bribing them with
baubles and trinkets. At the same time they made offen.
sive and defensive alliances with them. The Spanish in
the South; the French in the North and the English be-
tween, leagued themselves with the various tribes, supplied
them with gunpowder and turned them into mercenaries
who fought for hire. Heretofore the Indian had been a
free man, fighting his wars and feuds as free men have
done time out of mind. The whites hired him as a profes-
sional soldier and by putting bounties on scalps, plying the
Indians with whiskey and inciting them by every known
device, they converted them into demons.
There is no evidence to show that up to the advent of
the white men the Indian tribes did any more fighting
among themselves than the nobles of Germany, the city
states of Italy or the other inhabitants of western Europe.
Indeed there has recently been published a complete trans-
lation of the “Constitution of the Five Nations," a league
to enforce peace which the Indians organized about the
year 1390, A. D.8 This league which had as its object the
establishment of the “Great Peace” was built upon very
much the same argument as that advanced for the League
of Nations of 1919.
When the whites first came to North America, the In-
dians were a formidable foe. For years they continued to
be a menace to the lonely settler or the frontier village.
But when the white settlers were once firmly established,
the days of uncertainty were over, and the Indians were
brushed aside as a man brushes aside a troublesome
insect. Their "uprisings” and “wars” counted for little
or nothing. They were inferior in numbers; they were
8 Ses Bulletin 184, New York State Museum, Albany, 1916, p. 61.
THE AMERICAN EMPIRE
37
poorly armed and equipped; they had no reserves upon
which to draw; there was no organization among the tribes
in distant portions of the country. The white millions
swept onward. The Indian bands made a stand here and
there but the tide of white civilization overwhelmed them,
smothered them, destroying them and their civilization
together.
The Indians were the first obstacle to the building of the
American Empire. Three hundred years ago the whole
three million square miles that is now the United States
was theirs. They were the American people. To-day they
number 328,111 in a population of 105,118,467 and the
total area of their reservations is 53,489 square miles.
(Statistical Abstract of the U. S., 1918, pp. 8 and 776.)
THE AMERICAN EMPIRE
IV. SLAVERY FOR A RACE
1. The Labor Shortage
THE American colonists took the land which they re-
quired for settlement from the Indians. The labor neces-
sary to work this land was not so easily secured. The
colonists had set themselves the task of establishing Euro-
pean civilization upon a virgin continent. In order to
achieve this result, they had to cut the forests; clear the
land; build houses; cultivate the soil; construct ships;
smelt iron, and carry on a multitude of activities that were
incidental to setting up an old way of life in a new world,
The one supreme and immediate need was the need for
labor power. From the earliest days of colonization there
had been no lack of harbors, fertile soil, timber, minerals
and other resources. From the earliest days the colonists
experienced a labor shortage.
The labor situation was trebly difficult. First, there was
no native labor; second, passage from Europe was so long
and so hazardous that only the bold and venturesome were
willing to attempt it, and third, when these adventurers
did reach the new world, they had a choice between taking
up free land and working it for themselves and taking
service with a master. Men possessing sufficient initiative
to leave an old home and make a journey across the sea
were not the men to submit themselves to unnecessary
authority when they might, at will, become masters of their
own fortunes. The appeal of a new life was its own argu-
ment, and the newcomers struck out for themselves.
Throughout the colonies, and particularly in the South
where the plantation culture of rice and tobacco, and later
of cotton, called for large numbers of unskilled workers,
the labor problem was acute. The abundance of raw ma-
terials and fertile land; the speedy growth of industry in
ere nicht when they appeal of a ne out for themse
THE AMERICAN EMPIRE
39
the North and of agriculture in the South; the generous
profits and expanding markets created a labor demand
which far outstripped the meager supply,-a demand that
was met by the importation of black slaves from Africa.
2. The Slave Coast
The “Slave Coast” from which most of the Negroes
came was discovered by Portuguese navigators, who were
the first Europeans to venture down the West coast of
Africa, and, rounding the “lobe” of the continent, to sail
East along the “Gold Coast." The trade in gold and
ivory which sprang up as a result of these early explora-
tions led other nations of Europe to begin an eager com-
petition which eventually brought French, Dutch, German,
Danish and English commercial interests into sharp con-
flict with the Portuguese.
Ships sailing from the Gold Coast for home ports made
a practice of picking up such slaves as they could easily
secure. By 1450 the number reaching Portugal each year
was placed at 600 or 700.1 From this small and quite
incidental beginning there developed a trade which eventu-
ally supplied Europe, the West Indies, North America and
South America with black slaves.
Along the “Slave Coast,” which extended from Cape
Verde on the North to Cape St. Martha on the South, and
in the hinterland there lived Negroes of varying tempera-
ments and of varying standards of culture. Some of them
were fierce and warlike. Others were docile and amenable
to discipline. The former made indifferent slaves; the
latter were eagerly sought after. "The Wyndahs, Nagoes
and Pawpaws of the Slave Coast were generally the most
highly esteemed of all. They were lusty and industrious,
cheerful and submissive." 2
1 History of the Gold Coast,” W. W. Claridge. London, Murray,
1915, vol. I, p. 39.
2 “American Negro Slavery,” U. B. Phillips. New York, Appleton,
1908, p. 43.
40
THE AMERICAN EMPIRE
The natives of the Slave Coast had made some notable
cultural advances. They smelted metals; made pottery;
wove; manufactured swords and spears of merit; built
houses of stone and of mud, and made ornaments of some
artistic value. They had developed trade with the inte-
rior, taking salt from the coast and bartering it for gold,
ivory and other commodities at regular “market places.”
The native civilization along the west coast of Africa
was far from ideal, but it was a civilization which had
established itself and which had made progress during his-
toric times. It was a civilization that had evolved lan-
guage; arts and crafts; tribal unity; village life. and com-
munal organization. This native African civilization, in
the seventeenth, eighteenth and early nineteenth centuries
was confronted by an insatiable demand for black slaves.
The conflicts that resulted from the efforts to supply that
demand revolutionized and virtually destroyed all that
was worthy of preservation in the native culture.
When the whites first went to the Slave Coast there was
comparatively little slavery among the natives. Some cap-
tives, taken in war; some debtors, unable to meet their
obligations, and some violators of religious rites, were held
by the chief or the headman of the tribe. On occasion he
would sell these slaves, but the slave trade was never estab-
lished as a business until the white man organized it..
The whites came, and with guile and by force they per-
suaded and compelled the natives to permit the erection of
forts and of trading posts. From the time of the first
Portuguese settlement, in 1482, the whites began their
work with rum and finished it with gun-powder.' Rum de-
stroyed the stamina of the native; gun-powder rendered
his intertribal wars more destructive. These two agencies
of European civilization combined, the one to degenerate,
the other to destroy the native tribal life.
The traders, adventurers, buccaneers and pirates that
gathered along the Slave Coast were not able to teach the
natives anything in the way of cruelty, but they could and
41
did give them lessons in cunning, trickery and double deal-
ing. Early in the history of the Gold Coast the whites
began using the natives to make war on commercial rivals.
In one famous instance, “the Dutch had instigated the
King of Fetu to refuse the Assins permission to pass
through his territory. These people used to bring a great
deal of gold to Cape Coast Castle (English), and the
Dutch hoped in this way to divert the trade to their own
settlements. The King having complied and plundered
some of the traders on the way down, the Assins declared
war against him and were assisted by the English with arms
and ammunition. The King of Sabol was also paid to help
them, and the allied army (20,000 strong) inflicted a crush-
ing defeat on the Fetus.'' 3
On another occasion, the Dutch were worsted in a war
with some of the native tribes. Realizing that if they were
to maintain themselves on the Coast they must raise an
army as quickly as possible, they approached the Fetus
and bargained with them to take the field and fight the
Komendas until they had utterly exterminated them, on
payment of $4,500. But no sooner had this arrangement
been made than the English paid the Fetus an additional
$4,500 to remain neutral ! 4
Before 1750, when the competition for the slaves was
less keen, and the supply came nearer to meeting the de-
mand, the slavers were probably as honest in this as they
were in any other trade with the natives. The whites en-
couraged and incited the native tribes to make war upon
one another for the benefit of the whites. The whites fos-
tered kidnaping, slavery and the slave trade. The natives
vantage of their treachery. During the four hundred
years that the African slave trade was continued, it was.
the whites who encouraged it; fostered it; and backed it
financially. The slave trade was a white man's trade, car-
3“A History of the Gold Coast,"? W. W. Claridge. London, Mur.
ray, 1915, vol. I, p. 144.
4 Ibid., p. 150.
42
THE AMERICAN EMPIRE
ried on under conditions as far removed from the condi-
tions of ordinary African life as the manufacturing and
trading of Europe were removed from the manufacturing
and trading of the Africans.
3, The Slave Trade
With the pressing demand from the Americas for a gen-
erous supply of black slaves, the business of securing them
became one of the chief commercial activities of the time.
"The trade bulked so large in the world's commerce in the
seventeenth and eighteenth centuries that every important
maritime community on the Atlantic sought a share, gen-
erally with the sanction and often with the active assistance
of its respective sovereign." 5
The catching, holding and shipping of Negroes on the
African coast was the means by which the demand for
slaves was met. With a few minor exceptions, the whites
did not engage directly in slave catching. In most in-
stances they bought their slaves from native brokers who
lived in the coast towns. The brokers, in turn, received
their slaves from the interior, where they were captured
during wars, by professional raiding parties, well supplied
with arms and ammunition. Slave-catching, begun as a
kidnaping of individuals, developed into a large-scale traf-
fic that provided the revenue of the more war-like natives.
Villages were attacked and burned, and whole tribes were
destroyed or driven off to the slave-pens on the coast.
After 1750, for nearly a hundred years, the demand for
slaves was so great and the profits were so large that no
pains were spared to secure them.
The Slave Coast native was compelled to choose between
being a slave-catcher or a slave. As a slave-catcher he
spread terror and destruction among his fellows, seized
them and sold them to white men. As a slave he made
the long journey across the Atlantic.
5"American Negro Slavery," U. B. Phillips. New York, Appleton,
1918, p. 20.
THE AMERICAN EMPIRE
43
The number of slaves carried away from Africa is vari-
ously estimated. Claridge states that “the Guinea Coast
as a whole supplied as many as from 70,000 to 100,000
yearly” in 1700. Bogart estimates the number of slaves
secured as 2,500 per year in 1700; 15,000 to 20,000 per
year from 1713 to 1753; in 1771, 47,000 carried by British
ships alone; and in 1768 the slaves shipped from the Afri-
can coast numbered 97,000.: Add to these numbers those
who were killed in the raids; those who died in the camps,
where the mortality was very high, and those who com-
mitted suicide. The total represents the disturbing influ.
ence that the slave trade introduced into the native African
civilization.
In the early years of the trade the ships were small and
carried only a few hundred Negroes at most. As the trade
grew, larger and faster ships were built with galleries be-
tween the decks. On these galleries the blacks were forced
to lie with their feet outboard-ironed together, two and
two, with the chains fastened to staples in the deck. "They
were squeezed so tightly together that the average space
allowed to each one was but 16 inches by five and a half
feet.” 8 The galleries were frequently made of rough lum-
ber, not tightly joined. Later, when the trade was out-
lawed, the slaves were stowed away out of sight on loose
shelves over the cargo. “Where the 'tween decks space
was two feet high or more, the slaves were stowed sitting
up in rows, one crowded into the lap of another, and with
legs on legs, like rider on a crowded toboggan.” (Spears,
p. 71.) There they stayed for the weeks or the months of
the voyage. “In storms the sailors had to put on the
hatches and seal tight the openings into the infernal cess-
pool.” (Spears, p. 71.) The odor of a slaver was often
unmistakable at a distance of five miles down wind.
8 "History of the Gold Coast,” W. W. Claridge. London, Murray,
1915, vol. I, p. 172.
7 "Economic History of the U. S.,” E. L. Bogart. New York,
Longmans, 1910 ed., p. 84-5.
8 “The American Slave Trade," J. R. Spears. New York, Scrib-
ners, 1901, p. 69.
THE AMERICAN EMPIRE
de og en
de vel centrelerce et les
United States developed intemand for slaver
The terrible revolt of the slaves in the West Indies, be-
ginning in 1781, gave the growing anti-slavery sentiment
an immense impetus. It also gave the slave owners pause.
The cotton-gin had not yet been invented. Slavery was on
a shifty economic basis in the South. Great Britain passed
the first law to limit the slave trade in 1788; the United
States outlawed the trade in 1794. In 1824 Great Britain
declared the slave trade piracy. During these years, and
during the years that followed, until the last slaver left
New York Harbor in 1863, the trade continued under the
American flag, in swift, specially constructed American-
built ships.
As the restrictions upon the trade became more severe in
the face of an increasing demand for slaves, “the fitting
out of slavers developed into a flourishing business in the
United States, and centered in New York City.” The New
York Journal of Commerce notes in 1857 that “down-town
merchants of wealth and respectability are extensively en-
gaged in buying and selling African Negroes, and have
been, with comparatively little interruption for an indef-
inite number of years.” A writer in the Continental
Monthly for January, 1862, says:—“The city of New York
has been until of late the principal port of the world for
this infamous commerce; although the cities of Boston and
Portland are only second to her in distinction.” During
the years 1859-1860 eighty-five slavers are reported to have
fitted out in New York Harbor and these ships alone had
a capacity to transport from 30,000 to 60,000 slaves a year.
The merchants of the North pursued the slave trade so
relentlessly because it paid such enormous profits on the
capital outlay. Some of the voyages went wrong, but the
trade, on the whole, netted immense returns. At the end
of the eighteenth century a good ship, fitted to carry from
300 to 400 slaves, could be built for about $35,000. Such
a ship would make a clear profit of from $30,000 to $100,000
in a single voyage. Some of them made as many as five
DoThe Suppression of the American Slave Trade," W. E. B.
DuBois, New York, Longmans, 1896, p. 178-9.
THE PP-
45
AMERICAN EMPIRE
voyages before they became so foul that they had to be
abandoned.10 While some voyages were less profitable than
others, there was no avenue of international trade that of-
fered more alluring possibilities.
Sanctioned by potentates, blessed by the church, and sur-
rounded with the garments of respectability, the slave trade
grew, until, in the words of Samuel Hopkins (1787), “The
trade in human species has been the first wheel of com-
merce in Newport, on which every other movement in busi-
ness has depended. . .. By it the inhabitants have gotten
most of their wealth and riches.” (Spears, p. 20.) After
the vigorous measures taken by the British Government for
its suppression, the slave trade was carried on chiefly in
American-built ships; officered by American citizens;
backed by American capital, and under the American flag.
The slave trade was the business of the North as slavery
was the business of the South. Both flourished until the
Proclamation of Emancipation in 1863.
4. Slavery in the United States
Slavery and the slave trade date from the earliest colo-
nial times. The first slaves in the English colonies were
brought to Jamestown in 1619 by a Dutch ship. The first
American-built slave ship was the Desire, launched at
Marblehead in 1636. There were Negro slaves in New
York as early as 1626, although there were only a few hun-
dred slaves in the colonies prior to 1650.
Since slave labor is economical only where the slaves can
be worked together in gangs, there was never much slavery
among the farmers and small business men of the North.
On the other hand, in the South, the developing plantation
system made it possible for the owner to use large gangs
of slaves in the clearing of new land; in the raising of
10 “The American Slave Trade," J. R. Spears. New York, Scrib-
ners, 1901, p. 84-5.
THE AMERICAN EMPIRE
tobacco, and in caring for rice and cotton. The plantation
system of agriculture and the cotton gin made slavery the
success that it was in the United States. “The charac-
teristic American slave, indeed, was not only a Negro, but
a plantation workman." 11
The opening years of the nineteenth century found slav-
ery intrenched over the whole territory of the United States
that lay South of the Mason and Dixon line. In that ter-
ritory slave trading and slave owning were just as much
a matter of course as horse trading and horse owning were
a matter of course in the North. “Every public auc-
tioneer handled slaves along with other properity, and in
each city there were brokers, buying them to sell again, and
handling them on commission." 12
The position of the broker is indicated in the following
typical bill of sale which was published in Charleston, S. C.,
in 1795. “Gold Coast Negroes. On Thursday, the 17th
of March instant, will be exposed to public sale near the
exchange ... the remainder of the cargo of negroes im-
ported in the ship Success, Captain John Conner, con-
sisting chiefly of likely young boys and girls in good health,
and having been here through the winter may be considered
in some degree seasoned to the climate.” 18
Such a bill of sale attracted no more attention at that
time than a similar bill advertising cattle attracts to-day.
During the early colonial days, the slaves were better
fed and provided for than were the indentured servants.
They were of greater money value and, particularly in the
later years when slavery became the mainstay of Southern
agriculture, a first class Negro, acclimated, healthy, willing
and trustworthy, was no mean asset.
Toward the end of the eighteenth century slavery began
to show itself unprofitable in the South. The best and most
11 “American Negro Slavery,” U. B. Phillips. New York, Apple-
ton, 1918, p. VII.
12 Ibid., p. 190.
13 Ibid., p. 40.
THE AMERICAN EMPIRE
47
accessible land was exhausted. Except for the rice planta-
tions of South Carolina and Georgia, slavery was not
paying. The Southern delegates to the Constitutional Con.
vention, with the exception of the delegates from these
states, were prepared to abolish the slave trade. Some of
them were ready to free their own slaves. Then came the
invention of the cotton gin and the rise of the cotton king-
dom. The amount of raw cotton consumed by England was
13,000 bales in 1781; 572,000 bales in 1820; and 3,366,000
bales in 1860. During that period, the South was almost
the sole source of supply.
The attitude of the South, confronted by this wave of
slave prosperity, underwent a complete change. Her
statesmen had consented, between 1808 and 1820, to severe,
restrictive laws directed towards the slave trade. After
cotton became king, slaves rose rapidly in price; land, once
used and discarded, was again brought under cultivation;
cotton-planting spread rapidly into the South and South-
west; Texas was annexed; the Mexican War was fought;
an agitation was begun for the annexation of Cuba, and
Calhoun (1836) declared that he "ever should regret that
this term (piracy) had been applied” to the slave trade
in our laws.14
The change of sentiment corresponded with the changing
value of the slaves. Phillips publishes a detailed table of
slave values in which he estimates that an unskilled, able-
bodied young slave man was worth $300 in 1795; $500 to
$700 in 1810; $700 to $1200 to 1840; and $1100 to $1800
in 1860.15 The factors which resulted in the increased
slave prices were the increased demand for cotton, the in-
creased demand for slaves, and the decrease in the importa-
tion of negroes due to the greater severity of the prohibi-
tions on the slave trade.
14 Benton, "Abridgment of Debates.” XII, p. 718.
15 "American Negro Slavery," U. B. Phillips. New York, Apple-
ton, 1918, p. 370.
THE AMERICAN EMPIRE
5. Slavery for a Race
The American colonists needed labor to develop the
wilderness. White labor was scarce and high, so the colo-
nists turned to slave labor performed by imported blacks.
The merchants of the North built the ships and carried on
the slave trade at an immense profit. The plantation own-
ers of the South exploited the Negroes after they reached
the states.
The continuance of the slave trade and the provision of a
satisfactory supply of slaves for the Southern market de-
pended upon slave-catching in Africa, which, in turn, in-
volved the destruction of an entire civilization. This work
of destruction was carried forward by the leading com-
mercial nations of the world. During nearly 250 years the
English speaking inhabitants of America took an active
part in the business of enslaving, transporting and selling
black men. These Americans-citizens of the United States
--bought stolen Negroes on the African coast; carried them
against their will across the ocean; sold them into slavery,
and then, on the plantations, made use of their enforced
labor.
Both slavery and the slave trade were based on a purely
· economic motive-the desire for profit. In order to satisfy
that desire, the American people helped to depopulate vil-
lages,--to devastate, burn, murder and enslave; to wipe out
a civilization, and to bring the unwilling objects of their
gain-lust thousands of miles across an impassable barrier
to alien shores.
THE AMERICAN EMPIRE
49
V. THE WINNING OF THE WEST
1. Westward, Ho!
THE English colonists in America occupied only the nar-
row strip of country between the Alleghanies and the At-
lantic Ocean. The interior was inhabited by the Indians,
and claimed by the French, the Spanish and the British,
but neither possession nor legal title carried weight with
the stream of pioneers that was making a path into the
“wilderness," crying its slogan,-“Westward, Ho!” as it
moved toward the setting sun. The first objective of the
pioneers was the Ohio Valley; the second was the valley of
the Mississippi; the third was the Great Plains; the fourth
was the Pacific slope, with its golden sands. Each one of
these objectives developed itself out of the previous con-
quest.
The settlers who made their way across the mountains
into the valley of the Ohio, found themselves in a land of
plenty. The game was abundant; the soil was excellent,
and soon they were in a position to offer their surplus prod-
ucts for sale. These products could not be successfully
transported across the mountains, but they could be floated
down the Ohio and the Mississippima natural roadway to
the sea. But beside the Indians, who claimed all of the
land for their own, there were the Spaniards at New Or-
leans, doing everything in their power to prevent the
American Colonists from building up a successful river
commerce.
The frontiersmen were able to push back the Indians.
The Spanish garrisons presented a more serious obstacle.
New Orleans was a well fortified post that could be pro-
visioned from the sea. Behind it, therefore, lay the whole
power of the Spanish fleet. The right of navigation was
finally obtained in the Treaty of 1795, Still friction con-
tdown the Ohio aside the Indianthe Spaniards afevent the
50
THE AMERICAN EMPIRE
.
tinued with the Spanish authorities and serious trouble
was averted only by the transfer of Louisiana, first to the
French (1800) and then by them to the United States
(1803). Napoleon had agreed, when he secured this terri-
tory from the Spaniards, not to turn it over to the United
States. A pressing need of funds, however, led him to
strike an easy bargain with the American government
which was negotiating for the control of the mouth of the
Mississippi. Napoleon insisted that the United States take,
not only the mouth of the river, but also the territory to
the West which he saw would be useless without this outlet.
After some hesitation, Jefferson and his advisers accepted
the offer and the Louisiana Purchase was consummated.
The Louisiana Purchase gave the young American nation
what it needed a place in the sun. The colonists had
taken land for their early requirements from the Indians
who inhabited the coastal plain. They had enslaved the
Negroes and thus had secured an ample supply of cheap
labor. Now, the pressure of population, and the restless,
pioneer spirit of those early days, led out into the West.
Until 1830 immigration was not a large factor in the
increase of the colonial population, but the birth-rate was
prodigious. In the closing years of the eighteenth century,
Franklin estimated that the average family had eight chil-
dren. There were sections of the country where the popu-
lation doubled, by natural increase, once in 23 years. In-
deed, the entire population of the United States was in-
creasing at a phenomenal rate. The census of 1800 showed
5,308,483 persons in the country. Twenty years later the
population was 9,638,453-an increase of 81 per cent. By
1840 the population was reported as 17,069,453-an in-
crease of 77 per cent over 1820, and of 221 per cent over
1800.
The small farmers and tradesmen of the North were
settling up the Northwest Territory. The plantation own-
ers of the South, operating on a large scale, and with the
wasteful methods that inevitably accompany slavery, were
clamoring for new land to replace the tracts that had been
THE AMERICAN EMPIRE
51
exhausted by constant recropping with no attempt at fertili-
zation.
Cotton had been enthroned in the South since the inven-
tion of the cotton gin in 1792. With the resumption of
European trade relations in 1815 the demand for cotton
and for cotton lands increased enormously. There was
one, and only one logical way to meet this demand-through
the possession of the Southwest.
2. The Southwest
The pioneers had already broken into the Southwest in
large numbers. While Spain still held the Mississippi,
there were eager groups of settlers pressing against the
frontier which the Spanish guarded so jealously against
all comers. The Louisiana Purchase met the momentary
demand, but beyond the Louisiana Purchase, and between
the settlers and the rich lands of Texas lay the Mexican
boundary. The tide of migration into this new field hurled
itself against the Mexican border in the same way that an
earlier generation had roled against the frontier of
Louisiana.
The attitude of these early settlers is described with
sympathetic accuracy by Theodore Roosevelt. "Louisiana
was added to the United States because the hardy back-
woods settlers had swarmed into the valleys of the Ten-
nessee, the Cumberland and the Ohio by hundreds of thous-
ands. ... Restless, adventurous, hardy, they looked eagerly
across the Mississippi to the fertile solitudes where the
Spaniard was the nominal, and the Indian the real master;
and with a more immediate longing they fiercely coveted
the Creole provinces at the mouth of the river."1 This
fierce coveting could have only one possible outcome the
colonists got what they wanted.
1 “The Winning of the West,” 'Theodore Roosevelt. New York,
Putnam's, 1896, vol. 4, p. 262.
THE AMERICAN EMPIRE
The speed with which the Southwest rushed into promi-
nence as a factor in national affairs is indicated by its con-
tribution to the cotton-crop. In 1811 the states and ter-
ritories from Alabama and Tennessee westward produced
one-sixteenth of the cotton grown in the United States. In
1820 they produced a third; in 1830, a half; and by 1860,
three-quarters of the cotton raised. At the same time, the
population of the Alabama-Mississippi territory was:
200,000 in 1810.
445,000 in 1820.
965,000 in 1830.
1,377,000 in 1840.
Thus thirty years saw an increase of nearly seven-fold
in the population of this region.
Meanwhile, slavery had become the issue of the day. The
slave power was in control of the Federal Government, and
in order to maintain its authority, it needed new slave states
to offset the free states that were being carved out of the
Northwest.
Here were three forces---first the desire of the frontiers-
men for "elbow room"; second the demand of King Cotton
for unused land from which the extravagant plantation
system might draw virgin fertility and third, the necessity
that was pressing the South to add territory in order to hold
its power. All three forces impelled towards the South-
west, and it was thither that population pressed in the
years following 1820.
3. Texas
Mexico lay to the Southwest, and therefore Mexico became
the object of American territorial ambitions. The district
now known as Texas had constituted a part of the Louisiana
Purchase (1803); had been ceded to Spain (1819); had
been made the object of negotiations looking towards its
2 "American Negro Slavery," U. B Phillips. New York, Appleton,
1918, pp. 171-2.
THÉ AMERICAN EMPIRE
53
purchase in 1826; had revolted against Mexico and been
recognized as an independent state in 1835.
Texas had been settled by Americans who had secured the
permission of the Mexican Government to colonize. These
settlers made no effort to conceal their opposition to the
Mexican Government, with which they were entirely out of
sympathy. Many of them were seeking territory in which
slavery might be perpetuated, and they introduced slaves
into Texas in direct violation of the Mexican Constitution.
The Americans did not go to Texas with any idea of be-
coming Mexican subjects; on the contrary, as soon as they
felt themselves strong enough, they declared their inde-
pendence of Mexico, and began negotiations for the an-
nexation of Texas to the United States.
The Texan struggle for independence from Mexico was
cordially welcomed in all parts of the United States, but
particularly in the South. Despite the protests of Mexico,
public meetings were held; funds were raised; volunteers
were enlisted and equipped, and supplies and munitions
were sent for the assistance of the Texans in ships openly
fitted out in New Orleans.
No sooner had the Texans established a government than
the campaign for annexation was begun. The advocates
of annexation--principally Southerners-argued in favor
of adding so rich and so logical a prize to the territory of
the United States, citing the purchase of Louisiana and of
Florida as precedents. Their opponents, first on constitu-
tional grounds and then on grounds of public policy, argued
against annexation.
Opinion in the South was greatly aroused. Despite the
fact that many of her foremost statesmen were against an-
nexation, some of the Southern newspapers even went so far
as to threaten the dissolution of the Union if the treaty of
ratification failed to pass the Senate.
The campaign of 1844 was fought on the issue of an-
nexation and the election of James K. Polk was a pledge
that Texas should be annexed to the United States. During
THE AMERICAN EMPIRE
the campaign, the line of division on annexation had been
a party line-Democrats favoring; Whigs opposing. Be-
tween the election and the passage of the joint resolution
by which annexation was consummated, it became a sec-
tional issue,--Southern Whigs favoring annexation and
Northern Democrats opposing it.
So strong was the protest against annexation, that the
treaty could not command the necessary two-thirds vote in
the Senate. The matter was disposed of by the passage
of a joint resolution (March 1, 1845) which required only
a majority vote in both houses of Congress. President
Polk therefore took office with the mandate of the country
and the decision of both houses of the retiring Congress, in
favor of annexation.
Mexico, in the meantime, had offered to recognize the
independence of Texas and to make peace with her if the
Texas Congress would reject the joint resolution, and refuse
the proffered annexation. This the Texas Congress re-
fused, and with the passage, by that body, of an act pro-
viding for annexation, the Mexican minister was with-
drawn from Washington, and Mexico began her prepara-
tions for war.
President Polk had taken office with the avowed intention
of buying California from Mexico. The rupture threatened
to prevent him from carrying this plan into effect. He
therefore sent an unofficial representative to Mexico in an
effort to restore friendly relations. Failing in that, he and
his advisers determined upon war as the only feasible
method of obtaining California and of settling the diplo-
matic tangle involved in the annexation of Texas.
4. The Conquest of Mexico
The Polk Administration made the Mexican War as a
part of its expansionist policy.
“Although that unfortunate country (Mexico) had of-
ficially notified the United States that the annexation of
THE AMERICAN EMPIRE
55
the conducat open constant
Texas would be treated as a cause of war, so constant
were the internal quarrels in Mexico that open hostilities
would have been avoided had the conduct of the Adminis-
tration been more honorable. That was the opinion of
Webster, Clay, Calhoun, Benton, and Tyler. ... Mexico
was actually goaded on to war. The principle of the mani.
fest destiny of this country was invoked as a reason for the
attempt to add to our territory at the expense of Mexico.” 3
After the annexation of Texas it became the duty of the
United States to defend that state against the threatened
Mexican invasion.
Mexican troops had occupied the southern bank of the
Rio Grande. General Zachary Taylor with a small force,
moved to a position on the Nueces River. Between the two
rivers lay a strip of territory the possession of which was
one of the sources of dispute between Mexico and Texas.
What followed may be stated in the words of one of the
officers who participated in the expedition: “The presence
of the United States troops on the edge of the territory
farthest from the Mexican settlements was not sufficient to
provoke hostilities. We were sent to provoke a fight, but
it was essential that Mexico begin it” (p. 41). “Mexico
showing no willingness to come to the Nueces to drive the in-
vaders from her soil, it became necessary for the 'invaders'
to approach to within a convenient distance to be struck.
Accordingly, preparations were begun for moving the army
to the Rio Grande, to a point near Matamoras. It was
desirable to occupy a position near the largest center of
population possible to reach without actually invading
territory to which we set up no claim whatever” (p. 45).*
The occupation, by the United States troops, of the dis-
puted territory soon led to a clash in which several United
States soldiers were killed. The incident was taken by
the President as a sufficient cause for the declaration of a
3 “History of the United States," James F. Rhoades. New York,
Macmillan, 1906, vol. I, p. 87.
4 "Personal Memoirs," U. S. Grant. New York, Century, 1895,
vol. I.
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state of war. The House complied readily with his wishes,
passing the necessary resolution. Several members of the
Senate begged for a delay during which the actual state of
affairs might be ascertained. The President insisted, how-
ever, and the war was declared (May 13, 1846).
The declaration of war was welcomed with wild enthusi-
asm in the South. Meetings were called; funds were raised;
volunteers were enlisted, equipped and despatched in all
haste to the scene of the conflict.
The North was less eager. There were protests, petitions,
demonstrations. Many of the leaders of northern opinion
took a public stand against the war. But the news of the
first victories sent the country mad with an enthusiasm in
which the North joined the South.
The United States troops, during the Mexican War, won
brilliant-almost unbelievable successes against superior
forces and in the face of immense natural obstacles. Had
the war been less of a military triumph there must have
been a far more widely-heard protest from Polk's enemies
in the North. Successful beyond the wildest dreams of its
promoters, the victorious war carried its own answer to
those who questioned the worthiness of the cause. Within
two years, the whole of Mexico was under the military con-
trol of the United States, and that country was in a posi-
tion to dictate its own terms.
The demands of the United States were mild to the ex-
tent of generosity. Under the treaty the annexation of
Texas was validated ; New Mexico and Upper California
were ceded to the United States; the lower Rio Grande
was fixed as the southern boundary of Texas, and in con-
siderations of these additions to its territory, the United
States agreed to pay Mexico fifteen millions of dollars.
Under this plan, Mexico was paid for territory that she
did not need and could not use, while the United States
gave a money consideration for the title to land that was al-
ready hers by right of conquest, and of which she was in
actual possession.
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The details of the treaty are relatively unimportant.
The outstanding fact is that Mexico was in possession of
certain territory that the ruling power in the United States
wanted, and that ruling power took what it wanted by
force of arms. "The war was one of conquest in the in-
terest of an institution.” It was "one of the most unjust
ever waged by a stronger against a weaker nation.”
Congressman A. P. Gardner of Massachusetts sum-
marized the matter very pithily in his debate with Morris
to get away from Mexico and then we proceeded to annex
Texas. Plainly and bluntly stated, our purpose was to
get some territory for American development." (Steno-
graphic report in the New York Call, April 11, 1915.)
4. Conquering the Conquered
The work of conquering the Southwest was not completed
by the termination of the war. Mexico ceded the territory
-in the neighborhood of a million square miles--but she
was giving away something that she had never possessed.
Mexico claimed title to land that was occupied by the
Indians. She had never conquered it; never settled it;
never developed it. Her sovereignty was of the same
shadowy sort that Spain had exercised over the country
before the Mexican revolution.
The new owners of the Southwest had a very different
purpose in mind. No empty title would satisfy them.
They intended to use the land. The Indians—already in
possession-resented the encroachments of the invaders,
red-skinned brothers who had contended for the right to
fish and hunt along their home streams in the Appalachians.
The Indians of the Southwest fought stubbornly, but the
wars that meant life and death to them were the merest
8“Personal Memoirs," U. S. Grant. New York, Century, 1895,
vol. I, pp. 115 and 32.
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pastime for an army that had just completed the humilia-
tion of a nation of the size and strength of Mexico. The
Indians were swept aside, and the country was opened to
the trapper, the prospector, the trader and the settler.
The Mexican War was a slight affair, involving a rela-
tively small outlay in men and money. The total number
of American soldiers killed in the war was 1,721; the
wounded were 4,102; the deaths from accident and disease
were 11,516, making total casualties of 5,823 and total
losses of 15,618.6
The money cost of the Mexican War the army and
navy appropriations for the years 1846 to 1849 inclusive
was $119,624,000. Obviously the net cost of the war was
less than this gross total,-how much less it is impossible
to say.
No satisfactory figures are available to show the cost in
men and money of the Indian Wars in the Southwest.
“From 1849 to 1865, the government expended $30,000,000
in the subjugation of the Indians in the territories of New
Mexico and Arizona.". Their character may be gauged by
noting from the “Historical Register” (Vol. 2, p. 281-2) the
losses sustained in the four Indian Wars of which a record
is preserved. In the Northwest Indian Wars (1790 to 1795)
896 persons were killed and 436 were wounded; in the
Seminole War (1817 to 1818) 46 were killed and 36 were
wounded; in the Black Hawk War (1831-2) the killed were
26 and the wounded 39; in the Seminole War (1835-1842)
383 were killed and 557 wounded. These were among the
most serious of the Indian Wars and in all of them the cost
in life and limb was small. Judged on this standard, the
losses in the Southwest, during the Indian Wars, were, at
most, trifling. The total outlay that was involved in the
conquest of the vast domain would not have covered one
first class battle of the Great War, and yet this outlay added
8 "Historical Register of the United States Army,” F. B. Heitman.
Washington, Govt. Print., vol. 2, p. 282.
7 "The Story of New Mexico," Horatio 0. Ladd. Boston, D. Loth-
rop Co., 1891, p. 333.
en und the World and mainan wart
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59
to the territory of the United States something like a
million square miles containing some of the richest and most
productive portions of the earth's surface.
This domain was won by a process of military conquest;
it was taken from the Mexicans and the Indians by force of
arms. In order to acquire it, it was necessary to drive
whole tribes from their villages; to burn; to main; to kill.
“St. Louis, New Orleans, St. Augustine, San Antonio,
Santa Fe and San Francisco are cities that were built by
Frenchmen and Spaniards; we did not found them but we
conquered them.” “The Southwest was conquered only
after years of hard fighting with the original owners'
(p. 26). "The winning of the West and the Southwest
is a stage in the conquest of a continent” (p. 27). "This
great westward movement of armed settlers was essentially
one of conquest, no less than of colonization” (p. 370).8
None of the possessors of this territory were properly armed
or equipped for effective warfare. All of them fell an
easy prey to the organized might of the Government of the
United States.
8 "The Winning of the West," Theodore Roosevelt. Vol. I, p. 26,
27, and Vol. II, p. 370.
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VI. THE BEGINNINGS OF WORLD DOMINION
1. The Shifting of Control
DURING the half century that intervened between the
War of 1812 and the Civil War of 1861 the policy of the
United States government was decided largely by men
who came from south of the Mason and Dixon line. The
Southern whites,-class-conscious rulers with an institution
(slavery) to defend,-acted like any other ruling class
under similar circumstances. They favored Southward
expansion which meant more territory in which slavery
might be established.
The Southerners were looking for a place in the sun
where slavery, as an institution, might flourish for the
profit and power of the slave-holding class. Their most ef-
fective move in this direction was the annexation of Texas
and the acquisition of territory following the Mexican War.
An insistent drive for the annexation of Cuba was cut short
by the Civil War.
Southern sentiment had supported the Louisiana Pur-
chase of 1803 and the Florida Purchase of 1819. From
Jefferson's time Southern statesmen had been advocating
the purchase of Cuba. Filibustering expeditions were
fitted out in Southern ports with Cuba as an objective;
agitation was carried on, inside and outside of Congress;
between 1850 and 1861 the acquisition of Cuba was the
question of the day. It was an issue in the Campaign of
1853. In 1854 the American ministers to London, France
and Madrid met at the direction of the State Department
and drew up a document (the “Ostend Manifesto") deal-
ing with the future of Cuba. McMaster summarizes the
Manifesto in these words: “The United States ought to
buy Cuba because of its nearness to our coast; because it
belonged naturally to that great group of states of which
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61
the Union was the providential nursery; because it com-
manded the mouth of the Mississippi whose immense and
annually growing trade must seek that way to the ocean,
and because the Union could never enjoy repose, could
never be secure, till Cuba was within its boundaries.”
(Vol. viii, pp. 185-6.) If Spain refused to sell Cuba it was
suggested that the United States should take it.
The Ostend Manifesto was rejected by the State De-
partment, but it was a good picture of the imperialistic
sentiment at that time abroad among certain elements in
the United States.
The Cuban issue featured in the Lincoln-Douglas De-
bates in 1858. It was hotly discussed by Congress in 1859.
Only twenty years had passed since the United States, by
force of arms, had taken from Mexico territory that she
coveted. Now it was proposed to appropriate territory be-
longing to Spain.
The outbreak of hostilities deferred the project, and when
the Civil War was over, the slave power was shattered.
From that time forward national policy was guided by the
leaders of the new industrial North.
The process of this change was fearfully wasteful. The
shifting of power from the old régime to the new cost
more lives and a greater expenditure of wealth than all of
the wars of conquest that had been fought during the pre-
ceding half century.
The change was complete. The slaves were liberated by
Presidential Proclamation. The Southern form of civiliza-
tion-patriarchal and feudal--disappeared, and upon its
ruins-rapidly in the West; slowly in the South-there
arose the new structure of an industrial civilization.
The new civilization had no need to look outward for
economic advantage. Forest tracts, mineral deposits and
fertile land afforded ample opportunity at home. It was
three thousand miles to the Pacific and at the end of the
journey there was gold! The new civilization therefore
turned its energies to the problem of subduing the con-
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of it was up the territo, and proves we
tinent and of establishing the machinery necessary to pro-
vide for its vastly increasing needs. A small part of the
capital required for this purpose came from abroad. Most
of it was supplied at home. But the events involved in
opening up the territory west of the Rockies, of spanning
the country with steel, and providing outlets for the prod-
ucts of the developing industries were so momentous that
even the most ambitious might fulfill his dreams of con-
quest without setting foot on foreign soil. Territorial ag-
grandizement was forgotten, and men turned with a will to
the organization of the East and the exploration and devel-
opment of the West.
The leaders of the new order found time to take over
Alaska (1868) with its 590,884 square miles. The move
was diplomatic rather than economic, however, and it was
many years before the huge wealth of Alaska was even
suspected.
2. Hawaii
The new capitalist interests began to feel the need of
additional territory toward the end of the nineteenth cen-
tury. The desirable resources of the United States were
largely in private hands and most of the available free
land had been pre-empted. Beside that, there were certain
interests, like sugar and tobacco, that were looking with
longing eyes toward the tempting soil and climate of Ha-
waii, Porto Rico and Cuba.
When the South had advocated the annexation of Texas,
its statesmen had been denounced as expansionists and
imperialists. The same fate awaited the statesmen of the
new order who were favoring the extension of United
States territory to include some of the contiguous islands
that offered special opportunities for certain powerful fi-
nancial interests.
The struggle began over the annexation of Hawaii.
After numerous attempts to annex Hawaii to the United
States a revolution was finally consummated in Honolulu
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63
in 1893. At that time, under treaty provisions, the neu-
trality of Hawaii was guaranteed by the United States.
Likewise, "of the capital invested in the islands, two-thirds
is owned by Americans.” This statement is made in “Ad-
dress by the Hawaiian Branches of the Sons of the Ameri-
can Revolution, the Sons of Veterans, and the Grand Army
of the Republic to their compatriots in America Concern-
ing the Annexation of Hawaii.” (1897.) These advo-
cates of annexation state in the same address that: “The
revolution (of 1893) was not the work of filibusterers and
adventurers, but of the most conservative and law-abiding
citizens, of the principal tax-payers, the leaders of indus-
trial enterprises, etc.” The purpose behind the revolution
seemed clear. Certain business men who had sugar and
other products to sell in the United States, believed that
they would gain, financially, by annexation. They engi-
neered the revolution of 1893 and they were actively en-
gaged in the agitation for annexation that lasted until the
treaty of annexation was confirmed by the United States
in 1898. The matter was debated at length on the floor of
the United States Senate, and an investigation revealed the
essential facts of the case.
The immediate cause of the revolution in 1893 was fric-
tion over the Hawaiian Constitution. After some agita-
tion, a “Committee of Safety' was organized for the pro-
tection of life and property on the islands. Certain mem-
bers of the Hawaiian government were in favor of declar-
ing martial law, and dealing summarily with the conspira-
tors. The Queen seems to have hesitated at such a course
because of the probable complications with the government
of the United States.
The U.S. S. Boston, sent at the request of United States
Minister Stevens to protect American life and property in
the Islands, was lying in the harbor of Honolulu. After
some negotiations between the “Committee of Safety" and
Minister Stevens, the latter requested the Commander of
the Boston to land a number of marines. This was done
on the afternoon of January 16, 1893. Immediately the
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Governor of the Island of Oahu and the Minister of For-
eign Affairs addressed official communications to the United
States Minister, protesting against the landing of troops
“without permission from the proper authorities." Min-
ister Stevens replied, assuming full responsibility.
On the day following the landing of the marines, the
Committee of Safety, under the chairmanship of Judge
Dole, who had resigned as Justice of the Supreme Court
of Hawaii in order to accept the Chairmanship of the
Committee, proceeded to the government building, and
there, under cover of the guns of the United States Ma-
rines, who were drawn up for the purpose of protecting the
Committee against possible attack, a proclamation was read,
declaring the abrogation of the Hawaiian monarchy, and
the establishment of a provisional government "to exist
until terms of union with the United States have been ne-
gotiated and agreed upon." Within an hour after the
reading of this proclamation, and while the Queen and her
government were still in authority, and in possession of the
Palace, the Barracks, and the Police Station, the United
States Minister gave the Provisional Government his rec-
ognition.
The Queen, who had 500 soldiers in the Barracks, was in-
clined to fight, but on the advice of her counselors, she
yielded "to the superior force of the United States of
America” until the facts could be presented at Washington,
and the wrong righted.
Two weeks later, on the first of February, Minister Ste-
vens issued a proclamation declaring a protectorate over
the islands. This action was later repudiated by the au-
thorities at Washington, but on February 15, President
Harrison submitted a treaty of annexation to the Senate.
The treaty failed of passage, and President Cleveland, as
one of his first official acts, ordered a complete investigation
of the whole affair.
The Senate Committee on Foreign Relations submitted a
report on the matter February 26, 1894. Four members
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65
referred to the acts of Minister Stevens as "active, officious
and unbecoming participation in the events which led to
the revolution.” All members of the committee agreed
that his action in declaring a protectorate over the Islands
was unjustified.
The same kind of a fight that developed over the annexa-
tion of Texas now took place over the annexation of Ha-
waii. A group of senators, of whom Senator R. F. Petti-
grew was the most conspicuous figure, succeeded in pre-
venting the ratification of the annexation treaty until July
7, 1898. Then, ten weeks after the declaration of the Span-
ish-American War, under the stress of the war-hysteria,
Hawaii was annexed by a joint resolution of Congress.
The Annexation of Hawaii marks a turning point in
the history of the United States. For the first time, the
American people secured possession of territory lying out-
side of the mainland of North America. For the first time
the United States acquired territory lying within the
tropics. The annexation of Hawaii was the first im-
perialistic act after the annexation of Texas, more than
fifty years before. It was the first imperialistic act since
the capitalists of the North had succeeded the slave-owners
of the South as the masters of American public life.
3. The Spanish-American War
The real test of the imperial intentions of the United
States came with the Spanish-American War. An old,
shattered world empire (Spain) held Porto Rico, Cuba and
the Philippines. Porto Rico and Cuba were of peculiar
value to the sugar and tobacco interests of the United
States. They were close to the mainland, they were enor-
mously productive and, furthermore, Cuba contained im-
portant deposits of iron ore.
Spain had only a feeble grip on her possessions. For
years the natives of Cuba and of the Philippines had been
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in revolt against the Spanish power. At times the revolt
was covert. Again it blazed in the open.
The situation in Cuba was rendered particularly critical
because of the methods used by the Spanish authorities in
dealing with the rebellious natives. The Spaniards were
simply doing what any empire does to suppress rebellion
and enforce obedience, but the brutalities of imperialism,
as practiced in Cuba by the Spaniards, gave the Ameri-
can interventionists their opportunityDay after day the
newspapers carried front page stories of Spanish atrocities
in Cuba. Day after day the ground was prepared for
open intervention in the interests of the oppressed Cubans.
There was more than grim humor in the instructions which
a great newspaper publisher is reported to have sent his
cartoonist in Cuba, “You provide the pictures; we'll
furnish the war."
The conflict was precipitated by the blowing up of the
United States battleship Maine as she lay in the harbor of
Havana (February 15, 1898). It has not been settled to
this day whether the Maine was blown up from without or
within. At the time it was assumed that the ship was
blown up by the Spanish, although there was no evi-
dence whatever that any one connected with the exercise
of Spanish authority in Cuba had had so much as guilty
knowledge of the plans made to destroy the Maine” (p.
270), and although “toward the last it had begun to look
as if the Spanish Government were ready, rather than let
the war feeling in the United States put things beyond all
possibility of a peaceful solution, to make very substan-
tial concessions to the Cuban insurgents and bring the
troubles of the Island to an end” (p. 273-4).2
Congress, in a joint resolution passed April 20, 1898, de-
clared that "the people of the Island of Cuba are, and of
right ought to be, free and independent. ... The United
States hereby disclaims any intention to exercise sover-
eignty, jurisdiction or control over said island except for
1"A History of the American People,” Woodrow Wilson. New
York, Harpers, 1902, Vol. V, pp. 273-4.
within up by the that any cuba had befroy the
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67
the pacification thereof, and asserts its determination, when
that is accomplished, to leave the government and control
of the island to its people.”
The war itself was of no great moment. There was
little fighting on land, and the naval battles resulted in
overwhelming victories for the American Navy. The
treaty, ratified February 6, 1899, provided that Spain
should cede to the United States Guam, Porto Rico, Cuba
and the Philippines, and that the United States should pay
to Spain twenty millions of dollars. As in the case of
the Mexican War, the United States took possession of
the territory and then paid a bonus for a clear title.
The losses in the war were very small. The total num-
ber of men who were killed in action and who died of
wounds was 289; while 3,949 died of accidents and dis-
ease. (“Historical Register," Vol. 2, p. 187.) The cost
of the war was comparatively slight. Hostilities lasted
from April 21, 1898 to August 12, 1898. The entire mili-
tary and naval expense for the year 1898 was $443,368,000;
for the year 1899, $605,071,000. Again the need for a
larger place in the sun had been felt by the people of the
United States and again the United States had won im-
mense riches with a tiny outlay in men and money.
Now came the rval issue,What should the United
States do with the booty?
There were many who held that the United States was
bound to set the peoples of the conquered territory free.
To be sure the specific pledge contained in the joint resolu-
tion of April 20, 1898, applied to Cuba alone, but, it was
argued, since the people of the Philippines had also been
fighting for liberty, and since they had come so near to
winning their independence from the Spaniards, they were
likewise entitled to it.
On the other hand, the advocates of annexation insisted
that it was the duty of the United States to accept the re-
sponsibilities (the "white man's burden”) that the acquisi-
tion of these islands involved.
for the year al expense for omst 12, 1898. Hostilities Tastest
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As President McKinley put it:-"The Philippines, like
Cuba and Porto Rico, were entrusted to our hands by the
providence of God." (President McKinley, Boston, Feb-
ruary 16, 1899.) How was the country to avoid such a
duty ?
Thus was the issue drawn between the "imperialists”.
and the “anti-imperialists."
The imperialists had the machinery of government, the
newspapers, and the prestige of a victorious and very pop-
ular war behind them. The anti-imperialists had half a
century of unbroken tradition; the accepted principles of
self-government; the sayings of men who had organized
the Revolution of 1776; written the Declaration of Inde-
pendence; held exalted offices and piloted the nation
through the Civil War.
The imperialists used their inside position. The anti-
imperialists appealed to public opinion. They organized a
league "to aid in holding the United States true to the
principles of the Declaration of Independence. It seeks
the preservation of the rights of the people as guaranteed
to them by the Constitution. Its members hold self-gov-
ernment to be fundamental, and good government to be but
incidental. It is its purpose to oppose by all proper means
the extension of the sovereignty of the United States over
subject peoples. It will contribute to the defeat of any
candidate or party that stands for the forcible subjugation
of any people.” (From the declaration of principle
printed on the literature in 1899 and 1900.) Anti-im-
perialist conferences were held in New York, Philadelphia,
Chicago, Indianapolis, Boston and other large cities. The
League claimed to have half a million members. An ex-
tensive pamphlet literature was published, and every effort
was made to arouse the people of the country to the im-
portance of the decision that lay before them.
The imperialists said a great deal less than their op-
ponents, but they were more cffective in their efforts. The
President had said, in his message to Congress (April 1,
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69
1898), “I speak not of forcible annexation, for that can-
not be thought of. That, by our code of morals, would be
criminal aggression.” The phrase was seized eagerly by
those who were opposing the annexation of the Spanish
possessions. After the war with Spain had begun, the
President changed front on the ground that destiny had
placed a responsibility upon the American people that
they could not shirk. Taking this view of the situation,
the President had only one course open to him—to insist
upon the annexation of the Philippines, Porto Rico and
Guam. This was the course that was followed, and on
April 11, 1899, these territories were officially incorporated
into the United States.
Senator Hoar, in a speech on January 9, 1899, put the
issue squarely. He described it as “a greater danger than
we have encountered since the Pilgrims landed at Ply-
mouth-the danger that we are to be transformed from a
l'cpublic, founded on the Declaration of Independence,
guided by the counsels of Washington, into a vulgar, com-
monplace empire, founded upon physical force.''
Cuba remained to be disposed of. With the specific
guarantee of independence contained in the joint resolution
passed at the outbreak of the war, it seemed impossible to
do otherwise than to give the Cubans self-government.
Many influential men lamented the necessity, but it was
generally conceded. But how much independence should
Cuba have? That question was answered by the passage
of the Cuban Treaty with the “Platt Amendment” at-
tached. Under the treaty as ratified the United States
does exercise “sovereignty, jurisdiction and control” over
the island.
4. The Philippines
The territory acquired from Spain was now, in theory,
disposed of. Practically, the Philippines remained as a
source of difficulty and even of political danger.
The people of Cuba were, apparently, satisfied. The
Porto Ricans had accepted the authority of the United
(7
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States without question. But the Filipinos were not con-
tent. If the Cubans were to have self-government, why
not they?
The situation was complicated by the peculiar relations
existing between the Filipinos and the United States Gov-
ernment. Immediately after the declaration of war with
Spain the United States Consul-General at Singapore had
cabled to Admiral Dewey at Hong Kong that Aguinaldo,
leader of the insurgent forces in the Philippines, was then
at Singapore, and was ready to go to Hong Kong. Com-
modore Dewey cabled back asking Aguinaldo to come at
once to Hong Kong. Aguinaldo left Singapore on April
26, 1898, and, with seventeen other revolutionary Filipino
chiefs, was taken from Hong Kong to Manila in the United
States naval vessel McCulloch. Upon his arrival in Manila,
he at once took charge of the insurgents.
For three hundred years the inhabitants of the Philip-
pines had been engaged in almost incessant warfare with
the Spanish authorities. In the spring of 1898 they were
in a fair way to win their independence. They had a large
number of men under arms—from 20,000 to 30,000; they
had fought the Spanish garrisons to a stand-still, and were
in practical control of the situation.
Aguinaldo was furnished with 4,000 or 5,000 stands of
arms by the American officials, he took additional arms
from the Spaniards and he and his people coöperated ac-
tively with the Americans in driving the Spanish out of
Luzon. The Filipino army captured Iloilo, the second
largest city in the Philippines, without the assistance of
the Americans. On the day of the surrender of Manila,
1512 miles of the surrounding line was occupied by the
Filipinos and 600 yards by the American troops. Through-
out the early summer, the relations between the Filipinos
and the Americans continued to be friendly. General An-
derson, in command of the American Army, wrote a letter
to the commander of the Filipinos (July 4, 1898) in which
he said, "I desire to have the most amicable relations
with you and to have you and your people coöperate with
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71
us in military operations against the Spanish forces.”
During the summer the American officers called upon the
Filipinos for supplies and information and accepted their
coöperation. Aguinaldo, on his part, treated the Ameri-
cans as deliverers, and in his proclamations referred to
them as “liberators” and “redeemers."
The Filipinos, at the earliest possible moment, organ-
ized a government. On June 18 a republic was pro-
claimed; on the 23rd the cabinet was announced; on the
27th a decree was published providing for elections, and
on August 6th an address was issued to foreign govern-
ments, announcing that the revolutionary government was
in operation, and was in control of fifteen provinces.
The real intent of the Americans was foreshadowed in
the instructions handed by President McKinley to General
Wesley Merritt on May 19, 1898. General Merritt was
directed to inform the Filipinos that “we come not to make
war upon the people of the Philippines, nor upon any party
or faction among them, but to protect them in their homes,
in their employments, and in their personal and religious
rights. Any persons who, either by active aid or by hon-
est submission, coöperate with the United States in its
effort to give effect to this beneficent purpose, will receive
the reward of its support and protection.”
The Filipinos sent a delegation to Paris to lay their
claims for independence before the Peace Commission.
Meeting with no success, they visited Washington, with no
different result. They were not to be free!
On September 8, 1898, General Otis, commander of the
American forces in the Philippines, notified Aguinaldo that
unless he withdrew his forces from Manila and its suburbs
by the 15th “I shall be obliged to resort to forcible ac-
tion.” On January 5, 1899, by Presidential Proclamation,
McKinley ordered that "The Military Government hereto-
fore maintained by the United States in the city, harbor,
and bay of Manila is to be extended with all possible dis-
patch to the whole of the ceded territory." On February
THE AMERICAN EMPIRE
4, 1899, General Otis reported “Firing upon the Filipinos
and the killing of one of them by the Americans, leading
to return fire." (Report up to April 6, 1899.) Then fol-
lowed the Philippine War during which 1,037 Americans
were killed in action or died of wounds; 2,818 were
wounded, and 2,748 died of disease. (“'Historical Regis-
ter,” Vol. II, p. 293.)
The Philippines were conquered twice-once in a contest
with Spain (in coöperation with the Filipinos, who re-
garded themselves as our allies), and once in a contest
with the Filipinos, the native inhabitants, who were made
subjects of the American Empire by this conquest.”
5. Imperialism Accepted
The Philippine War was the last political episode in the
life of the American Republic. From February 4, 1899,
the United States accepted the political status of an Em-
pire. Hawaii had been annexed at the behest of the Ha-
waiian Government; Porto Rico had been occupied as a
part of the war strategy and without any protest from the
Porto Ricans. The Philippines were taken against the de-
termined opposition of the natives, who continued the
struggle for independence during three bitter years.
The Filipinos were fighting for independence-fighting
to drive invaders from their soil. The United States au-
thorities had no status in the Philippines other than that
of military conquerors.
Continental North America was occupied by the whites
after a long struggle with the Indian tribes. This territory
was “conquered'-but it was contiguous—it formed a part
of a geographic unity. The Philippines were separated
from San Francisco by 8,000 miles of water; geographically
they were a part of Asia. They were tropical in char-
2 For further details on the Philippine problem see Senate Docii-
ment 62, Part I, 55th Congress, Third Session.
THE AMERICAN EMPIRE
73
acter, and were inhabited by tribes having nothing in com-
mon with the American people except their common hu-
manity. Nevertheless, despite non-contiguity; despite dis-
tance; despite dissimilarity in languages and customs, the
soldiers of the United States conquered the Filipinos and
the United States Government took control of the islands,
acting in the same way that any other empire, under like
circumstances, unquestionably would have acted.
There was no strategic reason that demanded the Philip-
pines unless the United States desired to have an operating
base near to the vast resources and the developing markets
of China. As a vantage point from which to wage com-
mercial and military aggression in the Far East, the Philip-
pines may possess certain advantages. There is no other
excuse for their conquest and retention by the United
States save the economic excuse of advantages to be gained
from the possession of the islands themselves.
The end of the nineteenth century saw the end of the
Republic about which men like Jefferson and Lincoln wrote
and dreamed. The New Century marked the opening of
a new epoch-the beginning of world dominion for the
United States.
74.
THE AMERICAN EMPIRE
VII. THE STRUGGLE FOR WEALTH AND POWER
1. Economic Foundations
political dominialism wathe militar
THE people of the United States, through their contests
with the American Indians, the Mexicans and the Fili-
pinos, have established that "supreme and extensive politi-
cal domination” which is one of the chief characteristics
of empire.
But the American Empire does not rest upon a political
basis. Only the most superficial portions of its super-
structure are political in character. Imperialism in the
United States, as in every other modern country, is built
not upon politics, but upon industry.
The struggle between empires has shifted, in recent years,
from the political and the military to the economic field.
The old imperialism was based on military conquest and
political domination. The new “financial” imperialism is
based on economic opportunities and advantages. Under
this new régime, territorial domination is subordinated to
business profit.
While American public officials were engaged in the rou-
tine task of extending the political boundaries of the United
States, the foundations of imperial strength were being
laid by the masters of industrial life—the traders, manu-
facturers, bankers, the organizers of trusts and of industrial
combinations. These owners and directors of the nation's
wealth have been the real builders of the American Empire.
As the United States has developed, the economic motives
have come more and more to the surface, until no modern
nation—not England herself--has such a record in the
search for material possessions. The pursuit of wealth, in
the United States, has been carried forward ruthlessly;
brutally. “Anything to win” has been the motto. Man
THE AMERICAN EMPIRE
75
tion of the name ring people everywh the world in their
migrantsiore! morearly be deter
against man, and group against group, they have struggled
for gain,-first, in order to “get ahead;" then to accumu-
late the comforts and luxuries, and last of all, to possess the
immense power that goes with the control of modern wealth.
The early history of the country presaged anything but
this. The colonists were seeking to escape tyranny, to
establish justice and to inaugurate liberty. Their promises
were prophetic. Their early deeds put the world in their
debt. Forward looking people everywhere thrilled at the
mention of the name “America.” Then came the discovery
of the fabulous wealth of the new country; the pressure of
the growing stream of immigrants; the heaping up of
riches; the rapacious search after more! more! the deser-
tion of the dearest principles of America's early promise,
and the transcribing of another story of “economic deter-
minism."
Until very recent times the American people continued
to talk of political affairs as though they were the matters
of chief public concern. The recent growth and concen-
tration of economic power have showed plainly, however,
that America was destined to play her greatest rôle on the
economic field. Capable men therefore ceased to go into
politics and instead turned their energies into the whirl
of business, where they received a training that made them
capable of handling affairs of the greatest intricacy and
magnitude.
2. Every Man for Himself
The development of American industry, during the hun-
dred years that began with the War of 1812, led inevitably
to the unification of business control in the hands of a
small group of wealth owners.
“Every man for himself” was the principle that the
theorists of the eighteenth century bequeathed to the indus-
trial pioneers of the nineteenth. The philosophy of in-
dividualism fitted well with the temperament and experi-
ence of the English speaking peoples; the practice of in-
THE AMERICAN EMPIRE
dividualism under the formula "Every man for himself”
seemed a divine ordination for the benefit of the new in-
dustry.
The eager American population adopted the slogan with
enthusiasm. “Every man for himself” was the essence
of their frontier lives; it was the breath of the wilderness.
But the idea failed in practice. Despite the assurances
of its champions that individualism was necessary to pre-
serve initiative and that progress was impossible without
it, like many another principle-fine sounding in theory,
it broke down in the application.
The first struggle that confronted the ambitious con-
queror of the new world was the struggle with nature. Her
stores were abundant, but they must be prepared for human
use. Timber must be sawed; soil tilled; fish caught; coal
mined; iron smelted; gold extracted. Rivers must be
bridged; mountains spanned ; lines of communication main-
tained. The continent was a vast storehouse of riches
potential riches. Before they could be made of actual use,
however, the hand of man must transform them and trans-
port them.
These necessary industrial processess were impossible
under the “every man for himself” formula. Here was a
vast continent, with boundless opportunities for supplying
the necessaries and comforts of life-provided men were
willing to come together; divide up the work; specialize;
and exchange products.
Coöperation-alone could conquer nature. The basis
of this coöperation proved to be the machine. Its means
was the system of production and transportation built upon
the use of steam, electricity, gas, and labor saving appli-
ances.
When the United States was discovered, the shuttle was
thrown by hand; the hammer was wielded by human arm;
the mill-stones were turned by wind and water; the boxes
and bales were carried by pack-animals or in sailing vessels,
—these processess of production and transportation were
THE AMERICAN EMPIRE
77
conducted in practically the same way as in the time of
Pharaoh or of Alexander the Great. A series of discov-
eries and inventions, made in England between 1735 and
1784, substituted the machine for the tool; the power of
steam for the power of wind, water or human muscle; and
and set up the factory to produce, and the railroad and
the steamboat to transport the factory product.
American industry, up to 1812, was still conducted on
the old, individualistic lines. Factories were little known.
Men worked singly, or by twos and threes in sheds or work-
rooms adjoining their homes. The people lived in small
villages or on scattered farms. Within the century Amer-
ican industry was transformed. Production shifted to the
factory; about the factory grew up the industrial city in
which lived the tens or hundreds of thousands of factory
workers and their families.
The machine made a new society. The artisan could not
compete with the products of the machine. The home work-
shop disappeared, and in its place rose the factory, with
its tens, its hundreds and its thousands of operatives.
Under the modern system of machine production, each
person has his particular duty to perform. Each depends,
for the success of his service, upon that performed by thou-
sands of others.
All modern industry is organized on the principle
of coöperation, division of labor, and specialization. Each
has his task, and unless each task is performed the entire
system breaks down.
Never were the various branches of the military service
more completely dependent upon each other than are the
various departments of modern economic life. No man
works alone. All are associated more or less intimately
with the activities of thousands and millions of their
fellows, until the failure of one is the failure of all, and
the success of one is the success of all.
Such a development could have only one possible result,
people who worked together must live together. Scat-
THE AMERICAN EMPIRE
tered villages gave place to industrial towns and cities.
People were compelled to coöperate in their lives as well
as in their labor.
The theory under which the new industrial society be-
gan its operations was "every man for himself." The de-
velopment of the system has made every man dependent
upon his fellows. The principle demanded an extreme in-
dividualism. The practice has created a vast network of
inter-relations, that leads the cotton spinner of Massa-
chusetts to eat the meat prepared by the packing-house
operative in Omaha, while the pottery of Trenton and the
clothing of New York are sent to the Yukon in exchange
for fish and to the Golden Gate for fruit. Inside as well as
outside the nation, the world is united by the strong hands
of economic necessity. None can live to himself, alone.
Each depends upon the labor of myriads whom he has
never seen and of whom he has never heard. Whether we
will or no, they are his brothers-in-labor-united in the
Atlas fellowship of those who carry the world upon their
shoulders.
The theory of "every man for himself” failed. The
practical exigencies involved in subjugating a continent and
wresting from nature the means of livelihood made it neces-
sary to introduce the opposite principle,-"In Union there
is strength; coöperation achieves all things."
3. The Struggle for Organization
The technical difficulties involved in the mechanical pro-
duction of wealth compelled even the individualists to work
together. The requirements of industrial organization
drove them in the same direction.
The first great problem before the early Americans was
the answer. The second problem was the building of an
organization capable of handling the new mechanism of
production-an organization large enough, elastic enough,
THE AMERICAN EMPIRE
79
stable enough and durable enough to this problem the
corporation was the answer.
The machine produced the goods. The corporation di-
rected the production, marketed the products and financed
both operations.
The corporation, as a means of organizing and direct-
ing business enterprise is a product of the last hundred
years. A century ago the business of the United States
was carried on by individuals, partnerships, and a few
joint stock companies. At the time of the last Census, more
than four-fifths of the manufactured products were turned
out under corporate direction; most of the important mining
enterprises were corporate, and the railroads, public utili-
ties, banks and insurance companies were virtually all
under the corporate form of organization. Thus the pas-
sage of a century has witnessed a complete revolution in
the form of organizing and directing business enterprise.
The corporation, as a form of business organization is
immensely superior to individual management and to the
partnership.
1. The corporation has perpetual life. In the eyes of the
law, it is a person that lives for the term of its charter.
Individuals die; partnerships are dissolved; but the corpo-
ration with its unbroken existence, possesses a continuity
and a permanence that are impossible of attainment under
the earlier forms of business organization.
2. Liability, under the corporation, is limited by the
amount of the investment. The liability of an individual
or a partner engaged in business was as great as his ability
to pay. The investor in a corporation cannot lose a sum
larger than that represented by his investment.
3. The corporation, through the issuing of stocks and
bonds, makes it possible to subdivide the total amount in-
vested in one enterprise into many small units. These
1 The 169 largest railroads in the United States have issued 84,-
418,796 shares of stock. (“American Labor Year Book," 1917-18,
p. 169.) Theoretically, therefore, there might be eighty-four mil-
lions of owners of the American railroads.
80
THE AMERICAN EMPIRE
chances for small investment mean that a large number of
persons may join in subscribing the capital for a business
enterprise. They also mean that one well-to-do person
may invest his wealth in a score or a hundred enterprises,
thus reducing the risk of heavy losses to a minimum.
4. The corporation is not, as were the earlier forms of
organization, necessarily a "one man” concern. Many cor-
porations have upon their boards of directors the leading
business men, merchants, bankers and financiers. In this
way, the investing public has the assurance that the enter-
prise will be conducted along business lines, while the busi-
ness men on the board have an opportunity to get in on
the “ground floor.”
The corporation has a permanence, a stability, and a
breadth of financial support that are quite impossible in the
case of the private venture or of the partnership. It does
for business organization what the machine did for pro-
duction.
The corporation came into favor at a time when business
was expanding rapidly. Surplus was growing. Wealth
and capital were accumulating. Industrial units were
increasing in size. It was necessary to find some means by
which the surplus wealth in the hands of many individuals
could be brought together, large sums of capital concen-
trated under one unified control, the investments, thus
secured, safeguarded against untoward losses, and the busi-
ness conservatively and efficiently directed. The corpora-
tion was the answer to these needs.
"United we stand” proved to be as true of organizers and
investors as it was of producers. The corporation was the
common denominator of people with various industrial and
finanical interests.
The corporation played another rôle of vital consequence.
It enabled the banker to dominate the business world.
Heretofore, the banker had dealt largely with exchange.
The industrial leader was his equal if not his superior. The
THE AMERICAN EMPIRE
81
organization of the corporation put the supreme power in
the hands of the banker, who as the intermediary between
investor and producer, held the purse strings.
4. Capitalist against Capitalist
The early American enterprisers-the pioneers—began a
single-handed struggle with nature. Necessity forced them
to coöperate. They established a new industry. The
factory brought them together. They organized their sys-
tem of industrial direction and control. The corporation
united them. They turned on one another in mortal com-
bat, and the frightfulness of their losses forced them to
join hands.
The business men of the late nineteenth century had
been nurtured upon the idea of competition. “Every man
for himself and the devil take the hindermost” summed up
their philosophy. Each person who entered the business
arena was met by an array of savage competitors whose
motto was “Victory or Death.” In the struggle that fol.
lowed, most of them suffered death.
Capitalist set himself up against capitalist in bitter strife.
The railroads gouged the farmers, the manufacturers and
the merchants and fought one another. The big business
organizations drove the little man to the wall and then
attacked their larger rivals. It was a fight to the finish
with no quarter asked or given.
The “finish” came with periodic regularity in the seven-
ties, the eighties and the .nineties. The number of com-
mercial failures in 1875 was double the number of 1872.
The number of failures in 1878 was over three times that
of 1871. The same thing happened in the eighties. The
liabilities of concerns failing in 1884 were nearly four times
the liabilities of those failing in 1880. The climax came
in the nineties, after a period of comparative prosperity.
Hard times began in 1893. Demand dropped off. Produc-
tion decreased. Unemployment was widespread. Wages
THE AMERICAN EMPIRE
fell. Prices went down, down, under bitter competitive sel-
ling, to touch rock bottom in 1896. Business concerns con-
tinued to fight one another, though both were going to the
wall. Weakened by the struggle, unable to meet the com-
petitive price cutting that was all but the universal business
practice of the time, thousands of business houses closed
their doors. The effect was cumulative; the fabric of credit,
broken at one point, was weakened correspondingly in other
places and the guilty and the innocent were alike plunged
into the morass of bankruptcy.
The destruction wrought in the business world by the
panic of 1893 was enormous. The number of commercial
failures for 1893 jumped to 15,242. The amount of liabili-
ties involved in these failures was $346,780,000. This catas-
trophe, coming as it did so close upon the heels of the
panics that had immediately preceded it, could not fail to
teach its lesson. Competition was not the life, but the
death of trade. "Every man for himself” as a policy ap-
plied in the business world, led most of those engaged in the
struggle over the brink to destruction. There was but one
way out-through united action.
The period between 1897 and 1902 was one of feverish
activity directed to coördinating the affairs of the business
world. Trusts were formed in all of the important branches
of industry and trade. The public looked upon the trust
as a means of picking pockets through trade conspiracies
and the boosting of prices. The Sherman Anti-Trust Law
had been passed on that assumption. In reality, the trusts
were organized by far seeing men who realized that com-
petition was wasteful in practice and unsound in theory.
The idea that the failure of one bank or shoe factory was
of advantage to other banks and shoe factories, had not
stood the test of experience. The tragedies of the nineties
had showed conclusively that an injury to one part of the
commercial fabric was an injury to all of its parts.
The generation of business men trained since 1900 has
had no illusions about competition. Rather, it has had as
its object the successful combination of various forms of
had been posting of pri pockets thricio
THE AMERICAN EMPIRE
83
business enterprise into ever larger units. First, there was
the uniting of like industries-cotton mills were linked
with cotton mills, mines with mines. Then came the inte-
gration of industry—the concentration under one control
of all of the steps in the industrial process from the raw
material to the finished product--iron mines, coal mines,
blast furnaces, converters, and rail mills united in one or-
ganization to take the raw material from the ground and to
turn out the finished steel product. Last of all there was
the union of unlike industries, the control, by one group
of interests, of as many and as varied activities as could be
brought together and operated at a profit. The lengths
to which business men have gone in combining various in-
dustries is well shown by the recent investigation of the
meat packing industry. In the course of that investiga-
tion, the Federal Trade Commission was able to show
that the five great packers (Wilson, Armour, Swift, Morris
and Cudahy) were directly affiliated with 108 business
enterprises, including 12 rendering companies; 18 stock-
yard companies; 8 terminal railway companies; 9 manufac-
turers of packers' machinery and supplies; 6 cattle loan
companies; 4 public service corporations; 18 banks, and a
number of miscellaneous companies, and that they con-
trolled 2000 food products not immediately related to the
packing industry.?
Business is consolidated because consolidation pays not
primarily, through the increase of prices, but through the
greater stability, the lessened costs, and the growing secur-
ity that has accompanied the abolition of competition.
Again the forces of social organization have triumphed
in the face of an almost universal opposition. American
business men practiced competition until they found that
coöperation was the only possible means of conducting
large affairs. Theory advised, “Compete''! Experience
warned, “Combine”! Business men—like all other prac-
tical people accepted the dictates of experience as the
more of packers, terminal radering en
2 Summary of the Report of the Federal Trade Commission on the
Meat Packing Industry, July 3, 1918, Wash., Govt. Print., 1918.
84
THE AMERICAN EMPIRE
only sound basis for procedure. Their combination solidi-
fied their ranks, preparing them to take their places in a
closely knit, dominant class, with clearly marked interests,
and a strong feeling of class consciousness and solidarity.
It was in the consummation of these combinations, inte-
grations and consolidations that the investment banker
came into his own as the keystone in the modern industrial
arch.
5. The Investment Banker
The investment banker is the directing and coördina-
ting force in the modern business world. The necessities
of factory production demanding great outlays of capital;
the immense financial requirements of corporations; the
consolidation of business ventures on a huge scale; the
broadened use of corporate securities as investments-all
brought the investment banker into the foreground.
Before the Spanish War, the investment banker financed
the trusts. After the war he was entrusted with the vast
surpluses which the concentration of business control had
placed in a few hands. Business consolidation had given
the banker position. The control of the surplus brought
him power. Henceforth, all who wished access to the
world of great industrial and commercial affairs must
knock at his door.
This concentration of economic control in the hands of
a relatively small number of investment bankers has been
referred to frequently as the “Money Trust.”
Investment banking monopoly, or as it is sometimes
called, the "Money Trust” was examined in detail by
the Pujo Committee of the House of Representatives,
which presented a summary of its report on February 28,
1913. The committee placed, at the center of its diagram
of financial power, J. P. Morgan & Co., the National City
Bank, the First National Bank, the Guaranty Trust Co.,
and the Bankers Trust Co., all of New York. The report
refers to Lee, Higginson & Co. of Boston and New York;
Investme Moneyce of the Flo report on
THE AMERICAN EMPIRE
85
to Kidder, Peabody & Co., of Boston and New York, and
to Kuhn, Loeb & Co., of New York, together with the Mor-
gan affiliations, as being “the most active agents in for-
warding and bringing about the concentration of control
of money and credit” (p. 56).
The methods by which this control was effected are
classed by the Committee under five heads :-
1. “Through consolidations of competitive or potentially
competitive banks and trust companies which consolida-
tions in turn have recently been brought under sympathetic
management” (p. 56).
2. Through the purchase by the same interests of the
stock of competitive institutions.
3. Through interlocking directorates.
4. "Through the influence which the more powerful
banking houses, banks, and trust companies have secured
in the management of insurance companies, railroads, pro-
ducing and trading corporations and public utility corpora-
tions, by means of stock holdings, voting trusts, fiscal agency
contracts, or representation upon their boards of directors,
or through supplying the money requirements of railway,
industrial, and public utility corporations and thereby be-
ing enabled to participate in the determination of their
financial and business policies” (p. 56).
5. “Through partnership or joint account arrangements
between a few of the leading banking houses, banks, and
trust companies in the purchase of security issues of the
great interstate corporations, accompanied by understand-
ings of recent growth-sometimes called 'banking ethics'
which have had the effect of effectually destroying com-
petition between such banking houses, banks, and trust
companies in the struggle for business or in the purchase
and sale of large issues of such securities” (p. 56).
Morgan & Co., the First National Bank, the National
City Bank, the Bankers Trust Co., and the Guaranty Trust
THE AMERICAN EMPIRE
Co., which were all closely affiliated, had extended their
control until they held,-
118 directorships in 34 banks with combined resources
of $2,679,000,000.
30 directorships in 10 insurance companies with total
assets of $2,293,000,000.
105 directorships in 32 transportation systems having
63 directorships in 24 producing and trading com-
panies having a total capitalization of $3,339,-
000,000.
25 directorships in 12 public utility corporations with
a total capitalization of $2,150,000,000.
The investment banker had become, what he was ulti-
mately bound to be, the center of the system built upon
the century-long struggle to control the wealth of the con-
tinent in the interest of the favored few who happened to
own the choicest natural gifts.
6. The Cohesion of Wealth
JI
The struggle for wealth and power, actively waged
among the business men of the United States for more
than a century, has thus by a process of elimination, sub-
ordination and survival, placed a few small groups of
strong men in a position of immense economic power.
The growth of surplus and its importance in the world
of affairs has made the investment banker the logical
center of this business leadership. He, with his immediate
associates, directs and controls the affairs of the economic
world.
The spirit of competition ruled the American business
world at the beginning of the last century, the forces of
combination dominated at its close. The new order was
the product of necessity, not of choice. The life of the
THE AMERICAN EMPIRE
87
under the restraints of combination. It was the compelling
forces of impending calamity and the opportunity for
greater economic advantage--not the traditions or ac-
cepted 'standards of the business world that led to the
establishment of the centralized wealth power. American
business interests were driven together by the battering of
economic loss and lured by the hope of greater economic
gal Pears ofividualistiknit, hoppment oxx
Years of struggle and experience, by converting a scat-
tered, individualistic wealth owning class into a highly
organized, closely knit, homogeneous group with its com-
mon interests in the development of industry and the safe-
guarding of property rights, have brought unity and
power to the business world.
Individually the members of the wealth-controlling class
have learned that “in union there is strength"; collec-
tively they are gripped by the “cohesion of wealth'_the
class conscious instinct of an associated group of human
beings who have much to gain and everything to lose.
THE AMERICAN EMPIRE
VIII. THEIR UNITED STATES
1. Translating Wealth into Power
The first object of the economic struggle is wealth. The
second is power.
At the end of their era of competition, the leaders of
American business found themselves masters of such vast
stores of wealth that they were released from the paralyz-
ing fear of starvation, and were guaranteed the comforts
and luxuries of life. Had these men sought wealth as a
means of satisfying their physical needs their object would
have been attained.
The gratification of personal wants is only a minor ele-
ment in the lives of the rich. After they have secured the
things desired, they strive for the power that will give
them control over their fellows.
The possession of things, is, in itself, a narrow field. The
control over productive machinery gives him who exer-
cises it the power to enjoy those things which the workers
with machinery produce. The control over public affairs
and over the forces that shape public opinion give him who
exercises it the power to direct the thoughts and lives of
the people. It is for these reasons that the keen, self-
assertive, ambitious men who have come to the top in the
rough and tumble of the business struggle have steadily ex-
tended their ownership and their control.
2. The Wealth of the United States
The bulk of American wealth, which consists for the
most part of land and buildings, is concentrated in the
centers of commerce and industry—in the regions of su-
preme business power.
THE AMERICAN EMPIRE
89
The last detailed estimate of the wealth of the United
States was made by the Census Bureau for the year 1912.
At that time, the total wealth of the country was placed
at $187,739,000,000. (The estimate for 1920 is $500,000,-
000,000.) Roughly speaking, this represented an esti-
mate of exchangeable values. The figures, at best, are
rough approximations. Their importance lies, not in their
accuracy, but in the picture which they give of relationships.
The Total Wealth of the United States, Classified by
Groups, with the Percentage of the Total
Wealth in Each Group 1
Total Estimated
Wealth
Amount
(000,000 Per Cent
Wealth Groups
Omitted) of Total
1. Real Property (land and buildings) $110,676 59
2. Public Utilities (railroads, street
railways, telegraph, telephone,
electric light, etc.)............. 26,415 14
3. Live Stock and Machinery (live
stock, farm implements and man-
ufacturing machinery) ........ 13,697
4. Raw Materials, Manufactured Prod-
ucts, Merchandise (including
gold and silver bullion)........ 24,193
5. Personal Possessions (clothing,
personal adornments, furniture,
carriages, etc.) ............... 12,758
Total of all groups.......... $187,739 100
1 "Estimated Valuation of National Wealth, 1850-1912," Bureau
of the Census, 1915, p. 15.
90
THE AMERICAN EMPIRE
The bulk of the exchangeable wealth of the United
States consists of productive” or “investment” property.
If, to the total of 110 billions given by the Census as the
value of real property, are added the real property values
of the public utilities, the total will probably exceed three
quarters of the total wealth of the United States. If, in
addition, account is taken of the fact that much of the wealth
classed as “raw materials, etc.,” is the immediate product
of the land (coal, ore, timber), some idea may be obtained
of the extent to which the estimated wealth of the coun-
try is in the form of land, its immediate products, and
buildings. Furthermore, it must be remembered that great
quantities of ore lands, timber lands, waterpower sites,
etc., are assessed at only a fraction of their total present
value.
The personal property of the country is valued at less
than one fourteenth of the total wealth. It is in reality
a negligible item, as compared with the value of the real
property, of the public utilities, and of the raw materials
and products of industry.
The wealth of the United States is in permanent form-
land and improvements; personal possessions are a mere
incident in the total. In truth, American wealth is in the
main productive (business) wealth, designed for the fur-
ther production of goods, rather than for the satisfaction
of human wants.
3. Ownership and Control
Who owns this vast wealth? It is impossible to answer
the question with anything like definiteness. Figures have
been compiled --to show that -five per cent of the people-
own two-thirds to three-quarters of it; that the poorest
two-thirds of the people own five per cent of it; and that
the well-to-door middle class own the remainder. These
figures would make it appear that more than one-fourth
of the population is in the middle class. If the income-
tax returns are to be trusted this proportion is far too
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91
high. On all hands it is admitted that the wealth of the
country is concentrated in the hands of a small fraction
of the people and the important wealth-that is, the wealth
upon which production, transportation and exchange de-
pends-is in still fewer hands.
Neither the total wealth of the country, nor that portion
of the total which is owned directly by the propertied
class is of most immediate moment. Ownership does not
necessarily involve control. A puddler in the Gary Mills
may own five shares of stock in the Steel Corporation
without ever raising his voice to determine the corporation
policy. This is ownership without control. On the other
hand, a banking house through a voting trust agreement,
may control the policy of a corporation in which it does
not own one per cent of the stock. This is control with-
out ownership. Ownership may be quite incidental. It is
control that counts in terms of power.
Most of the property owners in the United States play
no part in the control of prices or of production, in the
direction of economic policy, or in the management of
economic affairs.
Theoretically, stockholders direct the policies of corpora-
tions, and, therefore, each holder of 5 or 10 shares of
corporate stock would play a part in deciding economic
affairs. Practically, the small stockholder has no part in
business control.
The small farmer-the small business man of largest
numerical consequence has been exploited by the great
interests for two generations. Despite his numbers and
his organizations, despite his frequent efforts, through
anti-trust laws, railway control laws, banking reform laws.
and the like, he has little voice in determining important
economic policies.
The small savings bank depositor or the holder of an
ordinary insurance policy is a negative rather than a posi-
tive factor in economic control. Not only does he exercise
no power over the dollar which he has placed with the
THE AMERICAN EMPIRE
largestries, publies. These
bank or with the insurance company, but he has thereby
strengthened the hands of these organizations. Each dol-
lar placed with the financier is a dollar's more power for
him and his.
Suppose--the impossible—that half of the families in
the United States own property." Subtract from this
number the small stockholders; the holders of bonds notes
and mortgages; the small tradesman; the small farmer;
the home owner and the owner of a savings-bank deposit
or of an insurance policy-what remains ? There are the
large stockholders, the owners and directors of important
industries, public utilities, banks, trust companies and in-
surance companies. These persons, in the aggregate, con-
stitute a fraction of one per cent of the adult population
of the United States.
Start with the total non-personal wealth of the country,
subtract from it the share-values of the small stockholders;
the values of all bonds, mortgages and notes; the property
of the small tradesman and the small farmer; the value of
homes—what remains ? There are left the stocks in the
hands of the big stockholders; the properties owned and
directed by the owners and directors of important indus-
tries, public utilities, banks, trust companies and insurance
companies. This wealth in the aggregate probably makes
up less than 10 per cent of the total wealth of the country
and yet the tiny fraction of the population which owns
this wealth can exercise a dictatorial control over the eco-
nomic policies that underlie American public life.
4. The Avenues of Mastery
While control rests back directly or indirectly upon some
form of ownership, most owners exercise little or no con-
trol over economic affairs. Instead they are made the vic-
tims of a social system under which one group lives at the
expense of another.
Against this tendency toward control by one group or
class (usually a minority) over the lives of another group
THE AMERICAN EMPIRE
or class (usually a majority) the human spirit always has
revolted. The United States in its earlier years was an
embodiment of the spirit of that revolt. President Wil-
son characterized it excellently in 1916. Speaking of the
American Flag, he said, “That flag was originally stained
in very precious blood, blood spilt, not for any dynasty,
nor for any small controversies over national advantage,
but in order that a little body of three million men in
America might make sure that no man was their master.” 2
Against mastery lovers of liberty protest. Mastery
means tyranny; mastery means slavery.
Mastery has always been based upon some form of owner-
ship. There is in the United States a group, growing in
size, of people who take more in keep than they give in
service; people who own land; franchises; stocks and bonds
and mortgages; real estate and other forms of investment
property; people who are living without ever lifting a
finger in toil, or giving anything in labor for an unceasing
stream of necessaries, comforts and luxuries. These peo-
ple, directly or indirectly, are the owners of the productive
machinery of the United States.
Historically there have been a number of stages in the
development of mastery. First, there was the ownership
of the body. One man owned another man, as he might
own a house or a pile of hides. At another stage, the
owner of the land the feudal baron or the landlord said
to the tenant, who worked on his land: “You stay on my
land. You toil and work and make bread and I will eat
it.” The present system of mastery is based on the owner-
ship by one group of people, of the productive wealth upon
which depends the livelihood of all. The masters of pres-
ent day economic society have in their possession the nat-
ural resources, the tools, the franchises, patents, and the
other phases of the modern industrial system with which
the people must work in order to live. The few who own
and control the productive wealth have it in their power
2 “Addresses of President Wilson,” House Doc. 803. Sixty-fourth
Congress, 1st Session (1916), p. 13.

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THE AMERICAN EMPIRE
to say to the many who neither own nor control, -"You
may work or you may not work.” If the masses obtain
work under these conditions the owners can say to them
further,_“You work, and toil and earn bread and we
will eat it.” Thus the few, deriving their power from the
means by which their fellows must work for a living,
own the jobs.
5. The Mastery of Job-Ownership
Job-ownership is the foundation of the latest and prob-
ably the most complete system of mastery ever perfected.
The slave was held only in physical bondage. Behind
serfdom there was land ownership and a religious sanc-
tion. "Divine right” and “God's anointed,” were
terms used to bulwark the position of the owning class,
who made an effort to dominate the consciences as well
as the bodies of their serfs. Job-ownership owes its effec-
tiveness to a subtle, psychological power that overwhelms
the unconscious victim, making him a tool, at once easy to
handle and easy to discard.
The system of private ownership that succeeded Feudal-
ism taught the lesson of economic ambition so thoroughly
that it has permeated the whole world. The conditions of
eighteenth century life have passed, perhaps forever, but
its psychology lingers everywhere.
The job-holder has been taught that he must "get
ahead” in the world; that if he practices the economic vir-
tues,—thrift, honesty, earnestness, persistence, efficiency-
he will necessarily receive great economic reward ; that he
must support his family on the standard set by the com-
munity, and that to do all of these essential things, he
must take a job and hold on to it. Having taken the job,
he finds that in order to hold it, he must be faithful to
the job-owner, even if that involves faithlessness to his
own ideas and ideals, to his health, his manhood, and the
lives of his wife and children.
ahead” in the wonesty, earnestra economic
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95
The driving power in slavery was the lash. Under
serfdom it was the fear of hunger. The modern system
of job-ownership owes its effectiveness to the fact that it
has been built upon two of the most potent driving forces in
all the world-hunger and ambition--the driving force
that comes from the desire for betterment. Thus job-
owning, based upon an automatic self-drive principle, en-
ables the job-owner to exact a return in faithful service
that neither slavery nor serfdom ever made possible. Job-
owning is thus the most thorough-going form of mastery
yet devised by the ingenuity of man.
Unlike the slave owner and the Feudal lord the modern
job-owner has no responsibility to the job-holder. The
slave owner must feed, clothe and house his slave-other-
wise he lost his property. The Feudal lord must protect
and assist his tenant. That was a part of his bargain with
his overlord. The modern job-owner is at liberty, at any
time, to “discharge” the job-holder, and by throwing him
out of work take away his chance of earning a living.
While he keeps the job-holder on his payroll, he may pay
him, impossibly low wages and overwork him under con-
ditions that are unfit for the maintenance of decent hu-
man life. Barring the factory laws and the health laws,
he is at liberty to impose on the job-holder any form of
treatment that the job-holder will tolerate.
There is no limit to the amount of industrial property
that one man may own. Therefore, there is no limit to
the number of jobs he may control. It is possible (not
immediately likely) that one coterie of men might secure
possession of enough industrial property to control the
jobs of all of the gainfully occupied people in American
industry. If this result could be achieved, these tens of
millions would be able to earn a living only in case the
small coterie in control permitted them to do so.
of land, resources, capital, credit, franchises, and other
special privileges. But its power of control goes far be-
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THE AMERICAN EMPIRE
yond this more physical ownership into tho realms of so-
cial psychology.
The early colonists, who fled from the economic, political,
social and religious tyranny of feudalism, believed that
liberty and freedom from unjust mastery lay in the pri-
vate ownership of the job. They had no thought of the
modern industrial machine.
The abolitionists who fought slavery believed that free-
dom and liberty could be obtained by unshackling the
body. They did not foresee the shackled mind.
The modern world, seeking freedom; yearning for lib-
erty and justice; aiming at the overthrow of the mastery
that goes with irresponsible power, finds to its dismay that
the ownership of the job carries with it, not only economic
mastery, but political, social and even religious mastery,
as well.
6. The Ownership of the Product
The industrial overlord holds control of the job with one
hand. With the other he controls the product of industry.
From the time the raw material leaves the earth in the
form of iron ore, crude petroleum, logs, or coal, through all
of the processes of production, it is owned by the indus-
trial master, not by the worker. Workers separate the
product from the earth, transport it, refine it, fabricate it.
Always, the product, like the machinery, is the possession
of the owning class.
While industry was competitive, the pressure of competi-
tion kept prices at a cost level, and the exploiting power
of the owner was confined to the job-holder. To-day,
through combinations and consolidations, industry has
ceased to be competitive, and the exploiting power of the
job-owner is extended through his ownership of the product.
The modern town-dweller is almost wholly in the hands
of the private owners of the products upon which he de-
pends. The ordinary city dweller spends two-fifths of
THE AMERICAN EMPIRE
97
his income for food; one-fifth for rent, fuel and light, and
one-fifth for clothes. Food, houses, fuel (with the excep-
tion of gas supply in some cities), and clothing are privately
owned. The public ownership of streets and water works,
of some gas, electricity, street cars, and public markets, is
a negligible factor in the problem. The private monopolist
has the upper hand and he is able through the control of
transportation, storage, and merchandising facilities, to
make handsome profits for the “service” which he renders
the consumer.
7. The Control of the Surplus
The wealth owners are doubly entrenched. They own
the jobs upon which most families depend for a living.
They own the necessaries of life which most families must
purchase in order to live. Further, they control the sur-
plus wealth of the community.
There are three principal channels of surplus. First of
all there is the surplus laid aside by business concerns,
reinvested in the business, spent for new equipment and
disposed of in other ways that add to the value of the
property. Second, there are the 19,103 people in the
United States with incomes of $50,000 or more per year;
the 30,391 people with incomes of $25,000 to $50,000 per
year and the 12,502 people with incomes of $10,000 to
$25,000 per year. (Figures for 1917.) Many, if not most
of these rich people, carry heavy insurance, invest in se-
curities, or in some other way add to surplus. In the third
place there are the small investors, savings-bank deposi-
tors, insurance policy holders who, from their income, have
saved something and have laid it aside for the rainy day.
The masters of economic life-bankers, insurance men, prop-
erty holders, business directors are in control of all three
forms of surplus.
The billions of surplus wealth that come each year un-
der the control of the masters carry with them an immense
authority over the affairs of the community. The owners

CE
NA
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THE AMERICAN EMPIRE
of wealth owe much of their immediate power to the fact
that they control this surplus, and are in a position to
direct its flow into such channels as they may select.
d. But the momunity. Theoduct, and its
8. The Channels of Public Opinion
No one can question the control which business interests
exercise over the jobs, the industrial product, and the
economic surplus of the community. These facts are uni-
versally admitted. But the corollaries which flow naturally
from such axioms are not so readily accepted. Yet given
the economic power of the business world, the control over
the channels of public opinion and over the machinery of
government follows as a matter of course.
The channels of public opinion—the school, the press,
the pulpit,-are not directly productive of tangible eco-
nomic goods, yet they depend upon tangible economic goods
for their maintenance. Whence should these goods come?
Whence but from the system that produces them, through
the men who control that system! The plutocracy exer-
cises its power over the channels of public opinion in two
ways,—the first, by a direct or business office control; and
second, by an indirect or social prestige control.
The business office control is direct and simple. Schools,
colleges, newspapers, magazines and churches need money.
They cannot produce tangible wealth directly, and they
must, therefore, depend upon the surplus which arises from
the productive activities of the economic world. Who con-
trols that surplus? Business men. Who, then, is in a
position to dictate terms in financial matters? Who but
the dominant forces in business life?
The facts are incontrovertible. It is not mere chance
that recruits the overwhelming majority of school-board
members, college trustees, newspaper managers, and church
vestrymen, from the ranks of successful business and pro-
fessional men. It is necessary for the educator, the jour-
nalist, and the minister to work through these men in
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99
order to secure the “sinews of war.” They are at the
focal points of power because they control the sources of
surplus wealth.
The second method of maintaining control-through the
control of social prestigem is indirect, but none the less
effective. The young man in college; the young graduate
looking for a job; the young man rising in his profession,
and the man gaining ascendancy in his chosen career are
brought into constant contact with the "influential” mem-
bers of the business world. It is the business world that
dominates the clubs and the vacation spots; it is the busi-
ness world that is met in church, at the dinner tables and
at the social gathering.
The man who would "succeed" must retain the favor of
this group. He does so automatically, instinctively or semi-
consciously—it is the common, accepted practice and he
falls in line.
The masters need not bribe. They need not resort to
illegal or unethical methods. The ordinary channels of
advertising, of business acquaintance and patronage, of
philanthropy and of social intercourse clinch their power
over the channels of public opinion.
9. The Control of Political Machinery
The American government, —-city, state and nation is
in almost the same position as the schools, newspapers and
churches. It does not turn out tangible, economic prod-
ucts. It depends, for its support, upon taxes which are
levied, in the first instance, upon property. Who are the
owners of this property? The business interests. Who,
therefore, pay the bills of the government? The business
interests.
Nowhere has the issue been stated more clearly or more
emphatically than by Woodrow Wilson in certain passages
of his “New Freedom.” As a student of politics and
100
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THE AMERICAN LMPIRE
government-particularly the American Government-he
sees the power, which those who control economic life are
able to exercise over public affairs, and realizes that their
influence has grown, until it overtops that of the political
world so completely that the machinery of politics is un-
der the domination of the organizers and directors of
industry.
“We know," writes Mr. Wilson in “The New Freedom,"
“that something intervenes between the people of the
United States and the control of their own affairs at Wash-
ington. It is not the people who have been ruling there
of late” (p. 28). "The masters of the government of
the United States are the combined capitalists and manu-
facturers of the United States. . . . Suppose you go to
Washington and try to get at your government. You
will always find that while you are politely listened to,
the men really consulted are the men who have the biggest
stakes—the big bankers, the big manufacturers, the big
masters of commerce, the heads of railroad corporations
and of steamship corporations. ... Every time it has come
to a critical question, these gentlemen have been yielded
to and their demands have been treated as the demands
that should be followed as a matter of course. The gov-
ernment of the United States at present is a foster-child
of the special interests” (p. 57-58). "The organization
of business has become more centralized, vastly more cen-
tralized, than the political organization of the country it-
self” (p.187). “An invisible empire has been set up above
the forms of democracy” (p. 35). “We are all caught in
a great economic system which is heartless” (p. 10).
This is the direct control exercised by the plutocracy
over the machinery of government. Its indirect control
is no less important, and is exercised in exactly the same
way as in the case of the channels of public opinion.
Lawyers receive preferment and fees from business-
there is no other large source of support for lawyers.
Judges are chosen from among these same lawyers. Usu-
ally they are lawyers who have won preferment and emolu-
THE AMERICAN EMPIRE
101
ment. Legislators are lawyers and business men, or the
representatives of lawyers and business men. The result
is as logical as it is inevitable.
The wealth owners control the machinery of government
because they pay the taxes and provide the campaign funds.
They control public officials because they have been, are,
or hope to be, on the payrolls, or participants in the profits
of industrial enterprises.
of hope to be, ombilic officials bedrovide the campusovernment
10. It is “Their United States'
The man fighting for bread has little time to “turn his
eyes up to the eternal stars. "The western cult of efficiency
makes no allowances for philosophic propensities. Its ob-
ject is product and it is satisfied with nothing short of that
sordid goal.
The members of the wealth owning class are relieved
from the food struggle. Their ownership of the social
machinery guarantees them a secure income from which
they need make no appeal. These privileges provide for
them and theirs the leisure and the culture that are the
only possible excuse for the existence of civilization.
The propertied class, because it owns the jobs, the in-
dustrial products, the social surplus, the channels of pub-
lic opinion and the political machinery also enjoys the
opportunity that goes with adequately assured income,
leisure and culture.
The members of the dominant economic class hold a key
-property ownership—which opens the structure of social
ones. Theirs are the things of this world.
The property owners enjoy the fleshpots. They hold the
vantage points. The vital forces are in their hands. Eco-
nomically, politically, socially, they are supreme.
If the control of material things can make a group se-
cure, the wealth owners in the United States are secure.
They hold property, prestige, power.
The phrase "our United States” as used by the great
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THE AMERICAN EMPIRE
majority of the people is a misnomer. With the exception
of a theoretically valuable but practically unimportant
right called “freedom of contract,” the majority of the
wage earners in the United States have no more excuse
for using the phrase "our United States” than the slaves
in the South, before the war, for saying “our Southland.”
The franchise is a potential power, making it theoretically
possible for the electorate to take possession of the country.
In practice, the franchise has had no such result. Quite
the contrary, the masters of American life by a policy of
chicanery and misrepresentation, advertise and support
first one and then the other of the “Old Parties,” both
of which are led by the members of the propertied class
or by their retainers. The people, deluded by the press,
and ignorant of their real interests, go to the polls year
after year and vote for representatives that represent, in
all of their interests, the special privileged classes.
The economic and social reorganization of the United
States during the past fifty years has gone fast and far.
The system of perpetual (fee simple) private ownership
of the resources has concentrated the control over the
natural resources in a small group, not of individuals, but
of corporations; has created a new form of social master,
in the form of a land-tool-job owner; has thus made pos-
sible a type of absentee-landlordism more effective and less
human than were any of its predecessors and has decreased
the responsibility at the same time that it has augmented
the power of the owning group. These changes have been
an integral part of a general economic transformation that
has occupied the chief energies of the ablest men of the
community for the past two generations.
The country of many farms, villages and towns, and of
a few cities, with opportunity free and easy of access, has
become a country of highly organized concentrated wealth
power, owned by a small fraction of the people and con-
trolled by a tiny minority of the owners for their benefit
and profit. The country which was rightfully called “our
United States” in 1840, by 1920 was "their United States"
in every important sense of the word.
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103
IX. THE DIVINE RIGHT OF PROPERTY
1. Land Ownership and Liberty
nemy; clarified their rankutal, comper
THE owners of American wealth have been molded grad-
ually into a ruling class. Years of- brutal, competitive,
economic struggle solidified their ranks,—distinguishing
friend from enemy; clarifying economic laws, and demon-
strating the importance of coördination in economic af-
fairs. Economic control, once firmly established, opened
before the wealth owning class an opportunity to dominate
the entire field of public life.
Before the property owners could feel secure in their
possessions, steps must be taken to transmute the popular
ideas regarding "property rights” into a public opinion
that would permit the concentration of important property
in the hands of a small owning class, at the same time that
it held to the conviction that society, without privately
owned land and machinery, was unthinkable.
Many of the leading spirits among the colonists had come
to America in the hope of realizing the ideal of “Every
man a farm, and every farm, a man.” Upon this prin-
ciple they believed that it would be possible to set up the
free government which so many were seeking in those
dark days of the divine right of kings.
For many years after the organization of the Federal
Government men spoke of the public domain as if it were
to last indefinitely. As late as 1832 Henry Clay, in a
discussion of the public lands, could say, "We should re-
joice that this bountiful resource possessed by our coun-
try, remains in almost undiminished quantity.” Later in
the same speech he referred to the public lands as being
“liberally offered,--in exhaustless quantities, and at mod-
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THE AMERICAN EMPIRE
erate prices, enriching individuals and tending to the
rapid improvement of the country.” 1
The land rose in price as settlers came in greater num-
bers. Land booms developed. Speculation was rife. Ef-
forts were made to secure additional concessions from the
Government. It was in this debate, where the public land
was referred to as “refuse land” that Henry Clay felt
called upon to remind his fellow-legislators of the sig-
nificance and growing value of the public land. He said,
“A friend of mine in this city bought in Illinois last fall
about two thousand acres of this refuse land at the mini-
mum price, for which he has lately refused six dollars per
acre. ... It is a business, a very profitable business, at
which fortunes are made in the new states, to purchase
these refuse lands and without improving them to sell
them at large advances.” 2
A century ago, while it was still almost a wilderness,
Illinois began to feel the pressure of limited resources—a
pressure which has increased to such a point that it has
completely revolutionized the system of society that was
known to the men who established the Government of the
United States.
This early record of a mid-western land boom, with
Illinois land at six dollars an acre, tells the story of every-
thing that was to follow. Even in 1832 there was not
enough of the good land to go around. Already the com-
munity was dividing itself into two classes those who
could get good land and those who could not. A wise man,
understanding the part played by economic forces in de-
termining the fate of a people, might have said to Henry
Clay on that June day in 1832, "Friend, you have pro-
nounced the obituary of American liberty."
Some wise man might have spoken thus, but how strange
the utterance would have sounded! There was so much

1 Speech in the Senate, June 20, 1832. Works Colvin Colton, ed.
New York, Putnam's, 1904, vol. 7, p. 503.
2 Ibid., p. 503.
THE AMERICAN EMPIRE
105
land, and all history seemed to guarantee the beneficial re-
sults that are derived from individual land ownership.
The democracies of Greece and Rome were built upon such
a foundation. The yeomanry of England had proved her
pride and stay. In Europe the free workers in the towns
had been the guardians of the rights of the people.
Throughout historic times, liberty has taken root where
there is an economic foundation for the freedom which
each man feels he has a right to demand.
2. Security of “Acquisitions"
A
Feudal Europe depended for its living upon agricul-
ture. The Feudal System had concentrated the ownership
of practically all of the valuable agricultural land in the
hands of the small group of persons which ruled because
it controlled economic opportunity. The power of this
class rested on its ownership of the resource upon which
the majority of the people depended for a livelihood.
The Feudal System was transplanted to England, but
it never took deep root there. When in 1215 A. D. (only
a century and a half after the Great William had made
his effort to feudalize England) King John signed the
Magna Carta, Feudalism proper gave way to landlordism-
the basis of English economic life from that time to this.
The system of English landlordism (which showed itself
at its worst in the absentee landlordism of Ireland) dif-
fered from Feudalism in this essential respect, Feudal-
ism was based upon the idea of the divine right of kings.
English landlordism was based on the idea of divine right
of property. English landlordism is the immediate an-
cestor of the property concept that is universally accepted
in the business world of to-day.
The evils of Feudalism and of landlordism were well
known to the American colonists who were under the im-
pression that they arose not from the fact of ownership,
but from the concentration of ownership. The resources
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THE AMERICAN EMPIRE
of the new world seemed limitless, and the possibility that
landlordism might show its ugly head on this side of the
Atlantic was too remote for serious consideration.
With the independence of the United States assured
after the War of 1812; with the growth of industry, and
the coming of tens of thousands of new settlers, the future
of democracy seemed bright. Daniel Webster character-
ized the outlook in 1821 by saying, “A country of such
vast extent, with such varieties of soil and climate, with so
much public spirit and private enterprise, with a popula-
tion increasing so much beyond former examples, . . . so
free in its institutions, so mild in its laws, so secure in the
title it confers on every man to his own acquisitions,-needs
nothing but time and peace to carry it forward to almost
any point of advancement." 3
“So free in its institutions, so mild in its laws, so secure
in the title it confers on every man to his own acquisi-
tions,”-the words were prophetic. At the moment when
they were uttered the forces were busy that were destined
to realize Webster's dream, on an imperial scale, at the
expense of the freedom which he prized. Men were free
to get what they could, and once having secured it, they
were safeguarded in its possession Property ownership
was a virtue universally commended. Constitutions were
drawn and laws were framed to guarantee to property
owners. the rights to their property, even in cases where
this property consisted of the bodies of their fellow men.
The movement toward the protection of property rights
has been progressive. Webster as a representative of the
dominant interests of the country a hundred years ago re-
joiced that every man had a secure title to “his own ac-
quisitions," at a time when the property of the country
was generally owned by those who had expended some
personal effort in acquiring it. It was a long step from
these personal acquisitions to the tens of billions of wealth
3 "Speeches,” E. P. Whipple, ed. Little, Brown & Co., 1910, pp.
59-60.
THE AMERICAN EMPIRE
107
in the hands of twentieth century American corporations.
Daniel Webster helped to bridge the gap. He was respon-
sible, at least in part, for the Dartmouth College Decision
granted by a state, is a contract that cannot be modified
at will by the state. This decision made the corporation,
once created and chartered, a free agent. Then came the
Fourteenth Amendment with its provision that "no
state shall make or enforce any law which shall abridge
the privileges or immunities of citizens of the United
States; nor shall any state deprive any person of life,
liberty or property, without due process of law.” The
amendment was intended to benefit negroes. It has been
used to place property ownership first among the Ameri-
can beatitudes.
Corporations are “persons” in the eyes of the law.
When the state of California tried to tax the property
of the Southern Pacific Railroad at a rate different from
that which it imposed on persons, the Supreme Court de-
clared the law unconstitutional. This decision, coupled
with that in the Dartmouth College Case secured for a
corporation “the same immunities as any other person; and
since the charter creating a corporation is a contract,
whose obligation cannot be impaired by the one-sided act
of a legislature, its constitutional position, as property
holder, is much stronger than anywhere in Europe."
These decisions "have had the effect of placing the mod-
ern industrial corporation in an almost impregnable con-
stitutional position.” 4
Surrounded by constitutional guarantees, armed with legal
Whehe Southern Pased on persons. This decision.ed for a
OTPOR by the as burope.
liberty, the private property interests in the United States
have gone forward from victory to victory, extending their
power as they increased and concentrated their possessions.
4 “The Constitutional Position of Property in America,” Arthur
T. Hadley, Independent, April 16, 1908.
108
THE AMERICAN EMPIRE
3. Safeguarding Property Rights
The efforts of Daniel Webster and his contemporaries to
protect "acquisitions have been seconded, with extraor-
dinary ability, by business organizers, accountants, lawyers
and bankers, who have broadened the field of their en-
deavors until it includes not merely “acquisitions,” but
all "property rights." Daniel Webster lived before the
era of corporations. He thought of “acquisitions” as
property secured through the personal efforts of the hu-
man being who possessed it. To-day more than half of
the total property and probably more than three-quarters
of productive wealth is owned by corporations. It re-
quired ability and foresight to extend the right of "ac-
quisitions” to the rights of corporate stocks and bonds.
The leaders among the property owners possessed the
necessary qualifications. They did their work masterfully,
and to-day corporate property rights are more securely
protected than were the rights of acquisitions a hundred
years ago.
The safeguards that have been thrown about property
are simple and effective. They arose quite naturally out
of the rapidly developing structure of industrialism.
First-There was an immense increase in the amount of
property and of surplus in the hands of the wealth-owning
class. After the new industry was brought into being
with the Industrial Revolution, economic life no longer
depended so exclusively upon agricultural land. Coal,
iron, copper, cement, and many other resources could now
be utilized, making possible a wider field for property
rights. Again, the amount of surplus that could be pro-
duced by one worker, with the assistance of a machine,
was much greater than under the agricultural system.
Second—The new method of conducting economic af-
fairs gave the property owners greater security of pos-
session. Property holders always have been fearful that
THE AMERICAN EMPIRE
109
some fate might overtake their property, forcing them into
the ranks of the non-possessors. When property was in
the form of bullion or jewels, the danger of loss was com-
paratively great. The Feudal aristocracy, with its land-
holdings, was more secure. Land-holdings were also more
satisfactory. Jewels and plate do not pay any rent, but
tenants do. Thus the owner of land had security plus a
regular income.
The corporation facilitated possession by providing a
means (stocks and bonds) whereby the property owner was
under no obligation other than that of clipping coupons or
cashing interest checks upon “securities” that are mat-
ters of public record; issued by corporations that make
detailed financial reports, and that are subject to vigorous
public inspection and, in the cases of banks and other fi-
nancial organizations, to the most stringent regulation.
Third Greater permanence has been secured for prop-
erty advantages. Corporations have perpetual, uninter-
rupted life. The deaths of persons do not affect them.
The corporation also overcame the danger of the dissipa-
tion of property in the process of “three generations from
shirt sleeves to shirt sleeves.” The worthless son of the
thrifty parent may still be able to squander his inheritance,
but that simply means a transfer of the title to his stocks
and bonds. The property itself remains intact.
Fourth Property has secured a claim on income that
is, in the last analysis, prior to the claim of the worker.
When a man ran his own business, investing his capital,
putting back part of his earnings, and taking from the
business only what he needed for his personal expenses,
"profits" were a matter of good fortune. There were
“good years” and “bad years,” when profits were high
or low. Many years closed with no profit at all. The
average farmer still handles his business in that way.
The incorporation of business, and the issuing of bonds
and stocks has revolutionized this situation. It is no longer
possible to "wait till things pick up." If the business has
110
THE AMERICAN EMPIRE
issued a million in bonds, at five per cent, there is an inter-
est charge of $50,000 that must be met each year. There
may be no money to lay out for repairs and needed im-
provements, but if the business is to remain solvent, it must
pay the interest on its bonds.
Businesses that are issuing securities to the public face
the same situation with regard to their stocks. Wise direc-
tors see to it that a regular rate, rather than a high rate
of dividends, is paid. Regularity means greater certainty
and stability, hence better consideration from the invest-
ing public.
Fifth The practices of the modern economic world have
gone far to increase the security of property rights.
Business men have worked ardently to “stabilize” busi-
ness. They have insisted upon the importance of "busi-
ness sanity;" of conservatism in finance; of the returns
due a man who risks his wealth in a business venture; and
of the fundamental necessity of maintaining business on a
sound basis. After centuries of experiment they have
evolved what they regard as a safe and sane method of
financial business procedure. Every successful business
man tried to live up to the following well-established
formula.
First, he pays out of his total returns, or gross receipts,
the ordinary costs of doing business-materials, labor, re-
pairs and the like. These payments are known as running
expenses or up-keep. .
Second, after up-keep charges are paid he takes the re-
mainder, called gross income, and pays out of it the fixed
charges taxes, insurance, interest and depreciation.
Third, the business man, having paid all of the neces-
sary expenses of doing business (the running expenses and
the fixed charges), has left a fund (net income) which,
roughly speaking, is the profits of the business. Out of
this net income, dividends are paid, improvements and
extensions of the plant are provided for.
p chare and pand dep
THE AMERICAN EMPIRE
111
Fourth, the careful business man increases the stability
of his business by adding something to his surplus or un-
divided profits.
The operating statistics of the United Steel Corporation
for 1918 illustrate the principle:
1. Gross Receipts...
...$1,744,312,163
Manufacturing and Operating expenses
including ordinary repairs........... 1,178,032,665
2. Gross Earnings ......................$ 566,279,498
Other income...........
. 40,474,823
$ 606,754,321
General Expense, (including commission
and selling expense, taxes, etc.) ....... 337,077,986
Interest, depreciation, sinking fund, etc. 144,358,958
8
.........................
Dividends ..........
125,317,377
96,382,027
........
4. Surplus for the year...................$ 28,935,350
Total surplus........
460,596,154
Like every carefully handled business, the Steel Corpora-
tion, -
1. Paid its running expenses,
2. Paid its fixed obligations,
3. Divided up its profits,
4. And kept a nest egg.
The effectiveness of such means of stabilizing property
income is illustrated by a compilation (published in the
Wall Street Journal for August 7th, 1919) of the business
of 104 American corporations between December 31, 1914,
and December 31, 1918. The inventories—value. of prop-
erty owned-had increased from 1,192 millions to 2,624 mil-
lions of dollars; the gain in surplus, during the four years,
112
THE AMERICAN EMPIRE
was 1,941 millions; the increase in "working capital” was
1,876 millions. These corporations, representing only a
small fraction of the total business of the country, hac
added billions to their property values during the four
years.
These various items,-up-keep; depreciation; insurance;
taxes; interest; dividends and surplus, -are recognized
universally by legislatures and courts as “legitimate” out-
lays. They, therefore, are elements that are always present
in the computation of a “fair” price. The cost to the con-
sumer of coffee, shoes, meat, blankets, coal and transpor-
tation are all figured on such a basis. Hence, it will be seen
that each time the consumer buys a pair of shoes or a pound
of meat, he is paying, with part of his money, for the
stabilizing of property.
Fifth. Property titles under this system are rendered
immortal. A thousand dollars, invested in 1880 in 5 per
cent. 40 year bonds, will pay to the owner $2,000 in interest
by 1920, at which time the owner gets his original thousand
back again to be re-invested so long as he and his descend-
ants care to do so. The dollar, invested in the business of
the steel corporation, by the technical processes of book-
keeping, is constantly renewed. Not only does it pay a re-
turn to the owner, but literally, it never dies.
The community is built upon labor. Its processes are
continued and its wealth is re-created by labor. The men
who work on the railroad keep the road operating; those
who own the railroad owe to it no personal fealty, and per-
form upon it no personal service. If the worker dies, the
train must stop until he is replaced; if the owner dies,
the clerk records a change of name in the registry books.
The well-ordered society will encourage work. It will
aim to develop enthusiasm, to stimulate activity. Never-
theless, in practical America” a scheme of economic or-
ganization is being perfected under which the cream of
life goes to the owners. They have the amplest opportuni-
ties. They enjoy the first fruits.
THE AMERICAN EMPIRE
113
4. Property Rights and Civilization
Undere property and how
the he protection hicher
Under these circumstances, it is easy to see how "the
rights of property” soon comes to mean the same thing
as “civilization,” and how “the preservation of law and
order" is always interpreted as the protection of property.
: With a community organized on a basis which renders
property rights supreme in all essential particulars, it is
but natural that the perpetuation of these rights should
be regarded as the perpetuation of civilization itself.
The present organization of economic life in the United
States permits the wealth owners through their ownership
to live without doing any work upon the work done by their
fellows. As recipients of property income (rent, interest
and dividends) they have a return for which they need
perform no service,-a return that allows them to "live
on their income.”
The man who fails to assist in productive activity gives
nothing of himself in return for the food, clothing and
shelter which he enjoys,—that is, he lives on the labor of
others. Where some have sowed and reaped, hammered
and drilled, he has regaled himself on the fruits of their
toil, while never toiling himself.
The matter appears most clearly in the case of an heir
to an estate. The father dies, leaving his son the title
deeds to a piece of city land. If he has no confidence in
his son's business ability or if his son is a minor, he may
leave the land in trust, and have it administered in his
son's interest by some well organized trust company. The
father did not make the land, though he did buy it. The
son neither made nor bought the land, it merely came to
him; and yet each year he receives a rent-payment upon
which he is able to live comfortably without doing any
work. It must at once be apparent that this son of his
father, economically speaking, performs no function in the
community, but merely takes from the community an an-
nual toll or rental based on his ownership of a part of the
114
THE AMERICAN EMPIRE
:
land upon which his fellowmen depend for a living. Of
what will this toll consist? Of bread, shoes, motor-cars,
cigars, books and pictures,--the products of the labor of
other men.
This son of his father is living on his.income,--supported
by the labor of other people. He performs no labor him-
self, and yet he is able to exist comfortably in a world
where all of the things which are consumed are the direct
or indirect product of the labor of some human being.
• Living on one's income is not a new social experience,
but it is relatively new in the United States. The practice
found a reasonably effective expression in the feudalism
of medieval Europe. It has been brought to extraordi-
nary perfection under the industrialism of Twentieth Cen-
tury America.
Imagine the feelings of the early inhabitants of the Amer-
ican colonies toward those few gentlemen who set them-
selves up as economically superior beings, and who insisted
upon living without any labor, upon the labor performed
by their fellows. It was against the suggestion of such a
practice that Captain John Smith vociferated his famous
“He that will not work, neither shall he eat." The sug-
gestion that some should share in the proceeds of community
life without participating in the hardships that were in-
volved in making a living seemed preposterous in those
early days.
To-day, living on one's income is accepted in every in-
dustrial center of the United States. as one of the methods
of gaining a livelihood. Some men and women work for
a living. Other men and women own for a living.
Workers are in most cases the humble people of the com-
munity. They do not live in the finest homes, eat the best
food, wear the most elaborate clothing, or read, travel and
enjoy the most of life.
The owners as a rule are the well-to-do part of the com-
munity. They derive much of all of their income from
THE AMERICAN EMPIRE
115
investments. The return which they make to the commu-
nity in services is small when compared with the income
which they receive from their property holdings.
Living on one's income is becoming as much a part of
American economic life as living by factory labor, or by
mining, or by manufacturing, or by any other occupation
upon which the community depends for its products. The
difference between these occupations and living on one's
income is that they are relatively menial, and it is rela-
tively respectable, that is, they have won the disapprobation
and it has won the approbation of American public opinion.
The best general picture of the economic situation that
permits a few people to live on their incomes, while the
masses of the people work for a living, is contained in the
reports of the Federal Commissioner of Internal Revenue.
The figures for 1917 (“Statistics of Income for 1917” pub-
lished August 1919) show that 3,472,890 persons filed re-
turns, making one for each six families in the United States.
Almost one half of the total number of returns made in 1917
were from persons whose income was between $1000 and
$2000. There were 1,832,132 returns showing incomes of
$2000 or more, one for each twelve families in the country.
The number of persons receiving the higher incomes is
comparatively small. There were 270,666 incomes between
$5,000 and $10,000; 30,391 between $10,000 and $25,000;
12,439 between $25,00 and $50,000. There were 432,662 re-
turns (22 for each 1000 families in the United States) show-
ing incomes of $5,000 or over; there were 161,996 returns
(8 returns for each 1000 families) showing incomes of $10,-
000 or over; 49,494 showing incomes of $25,000 and over;
19,103 showing incomes of $50,000 and more. Thus the
number of moderate and large incomes, compared with the
total population of the country, was minute.
The portion of the report that is of particular interest,
in so far as the present study is concerned, is that which
presents a division of the total net income of those report-
ing $2,000 or more, into three classes-income from per-
116
THE AMERICAN EMPIRE
sonal service, income from business profits and income
from the ownership of property.
Per Cent
of Total
Income
30.21
PERSONAL INCOMES BY SOURCES--1917
Amount of
Income
Source
1. Income from personal sery-
ice; salaries, wages; com-
mission, bonuses, director's
fees, etc................. $ 3,648,437,902
2. Income from business; busi-
ness, trade, commerce,
partnership, farming, and
profits from sales of real
estate, stocks, bonds, and
other property.......... 3,958,670,028
3. Income from property; rents.
and royalties.......... .684,343,399
Interest on bonds, notes, etc. 936,715,456
Dividends ......
2,848,842,499
Total from Property........ 4,469,901,354
4 Total income.............. 12,077,009,284
32.77
5.67
7.76
23.59
37.02
100.00
Those persons who have incomes of $2,000 or more receive
30 cents on the dollar in the form of wages and salaries;
33 cents in the form of business profits, and 37 cents in the
form of incomes from the ownership of property. The div-
idend payments alone—to this group of property owners,
are equal to three quarters of the total returns for personal
service.
These figures refer, of course, to all those in receipt of
$2,000 or more per year. Obviously, the smaller incomes
are in the form of wages, salaries, and business profits,
while the larger incomes take the form of rent, interest and
dividends. This is made apparent by a study of the de-
tailed tables published in connection with the “Income
Statistics for 1916."
THE AMERICAN EMPIRE
117
Among those of small incomes $5,000 to $10,000_nearly
half of the income was derived from personal services.
The proportion of the income resulting from personal serv-
ice diminished steadily as the incomes rose until, in the
highest income group-those receiving $2,000,000 or more
per year, less than one-half of one per cent. was the result
of personal service while more than 99 per cent. of the in-
comes came from property ownership.
A small portion of the American people are in receipt
of incomes that necessitate a report to the revenue officers.
Among those persons, a small number are in receipt of in-
comes that might be termed large-incomes of $10,000
or over, for example. Among these persons with large in-
comes the majority of the income is secured in the form
of rent, interest, dividends and profits. The higher the
income group, the larger is the percentage of the income
that comes from property holdings.
The economic system that exists at the present time in the
United States places a premium on property ownership.
The recipients of the large incomes are the holders of the
large amounts of property.
Large incomes are property incomes. The rich are rich
because they are property owners. Furthermore, the or-
ganization of present-day business makes the owner of
property more secure-far more secure in his income, than
is the worker who produces the wealth out of which the
property income is paid.
5. Plutocracy
The owning class in the United States is established on
an economic basis,-the private ownership of the earth. No
more solid foundation for class integrity and class power
has ever been discovered.
The owners of the United States are powerfully en-
trenched. Operating through the corporation, its members
have secured possession of the bulk of the more useful
118
THE AMERICAN EMPIRE
resources, the important franchises and the productive cap-
ital. Where they do not own outright, they control. The
earth, in America, is the landlords and the fullness thereof.
They own the productive machinery, and because they own
they are able to secure a vast annual income in return for
their bare ownership.
Families which enjoy property income have one great
common interest-that of perpetuating and continuing the
property income; hence the cohesion of wealth." The
cohesion of wealth” is a force that welds individuals and
families who receive property income into a unified group
or class.
The cohesion of wealth is a force of peculiar social signif-
icance. It might perhaps be referred to as the class con-
sciousness of the wealthy except that it manifests itself
among people who have recently acquired wealth, more
violently, in some cases, than it appears among those whose
families have possessed wealth for generations. Then, the
cohesion of wealth is not always an intelligent force. In
the case of some persons it is largely instinctive.
Originally, the cohesion of wealth expresses itself instinc-
tively among a group of wealth owners. They may be
competing fiercely as in the case of a group of local banks,
department stores, or landlords, but let a common enemy
appear, with a proposition for currency reform, labor legis-
lation or land taxation and in a twinkling the conflicting
interests are thrown to the winds and the property owners
are welded into a coherent, unified group. This is the
beginning of a wealth cohesion which develops rapidly
into a wealth consciousness.
American business, a generation ago, was highly com-
petitive. Each business man's hand was raised against his
neighbor and the downfall of one was a matter of rejoicing
for all. The bitter experience of the nineties drove home
some lessons; the struggles with labor brought some more;
the efforts at government regulations had their effect; but
most of all, the experience of meeting with men in various

THE AMERICAN EMPIRE
119
lines of business and discussing the common problems
through the city, state and national and business organi-
zations led to a realization of the fact that those who owned
and managed business had more in common than they had
in antagonism. By knifing one another they made them-
selves an easy prey for the unions and the government.
By pooling ideas and interests they presented a solid front
to the demands of organized labor and the efforts of the
public to enforce regulation
"Plutocracy” means control by those who own wealth.
The "plutocratic class” consists of that group of persons
who control community affairs because they own property.
This class, because of its property ownership, is compelled
to devote time and infinite pains to the task of safeguard-
ing the sacred rights of property. It is to that task that
the leaders of the American plutocracy have committed
themselves, and it is from the results of that accomplished
work that they are turning to new labors.
120
THE AMERICAN EMPIRE
X. INDUSTRIAL EMPIRES
1. They Cannot Pause!
The foundations of Empire have been laid in the United
States. Territory has been conquered; peoples have been
subjugated or annihilated; an imperial class has established
itself. Here are all of the essential characteristics of
empire.
The American people have been busy laying the politi-
cal foundations of Empire for three centuries. A great
domain, taken by force of arms from the people who were
in possession of it has been either incorporated into the
Union, or else held as dependent territory. The aborigines
have disappeared as a race. The Negroes, kidnaped from
their native land, enslaved and later liberated, are still
treated as an inferior people who should be the hewers
of wood and the drawers of water. A vast territory was
taken from Mexico as a result of one war. A quarter mil-
lion square miles were secured from Spain in another; on
the Continent three and a half millions of square miles; in
territorial possessions nearly a quarter of a million more-
this is the result of little more than two hundred years of
struggle; this is the geographic basis for the American
Empire.
The structure of owning class power is practically com-
plete in the United States. Through long years the busi-
ness interests have evolved a form of organization that con-
centrates the essential power over the industrial and fi-
nancial processes in a very few hands,-the hands of the in-
vestment bankers. During this contest for power the plu-
tocracy learned the value of the control of public opinion,
and brought the whole machinery for the direction of pub-
lic affair's under its domination. Thus political and social
institutions as well as the processes of economic life were
THE AMERICAN EMPIRE
121
Skystadhtarit Aud?.
made subject to plutocratic authority. A hundred years
has sufficed to promulgate ideas of the sacredness of pri-
vate property that place its preservation and protection
among the chief duties of man. Economic organization;
the control of all important branches of public affairs, and
the elevation of property rights to a place among the beati-
tudes-by these three means was the authority of the plu-
tocracy established and safeguarded.
Since economic political and social power cover the field
of authority that one human being may exercise over an-
other, it might be supposed that the members of the pluto-
cratic class would pause at this point and cease their efforts
to increase power. But the owners cannot pause! A force
greater than their wills compels them to go on at an ever
growing speed. Within the vitals of the economic system
upon which it subsists the plutocracy has found a source
of never-ending torment in the form of a constantly in-
creasing surplus.
2. The Knotty Problem of Surplus
The present system of industry is so organized that the
worker is always paid less in wages than he creates in prod-
uct. A part of this difference between product and wages
goes to the upkeep and expansion of the industry in which
the worker is employed. Another part in the form of in-
terest, dividends, rents, royalties and profits, goes to the
owners of the land and productive machinery,
The values produced in industry and handed to the in-
dustrial worker or property owner in the form of income,
may be used or "spent” either for “consumption goods” —
things that are to be used in satisfying human wants,
such as street car transportation, clothing, school books,
and smoking tobacco; or for production goods things that
are to be used in the making of wealth, such as factory
buildings, lathes, harvesting machinery, railroad equipment.
Those who have small incomes necessarily spend the greater
122
THE AMERICAN EMPIRE
part for the consumption of goods upon which their exis-
tence depends. On the other hand, those who are in receipt
of large incomes cannot use more than a limited amount of
consumption goods. Therefore, they are in a position to
turn part of their surplus into production goods. As a
reward for this "saving? the system gives them title to an
amount of wealth equal to the amount saved, and in addi-
tion, it grants an amount of “interest" so that the next
year the recipient of surplus gets the regular share of sur-
plus, and beside that an additional reward in the form of
interest. His share of the surplus is thus increased. That
is, surplus breeds surplus.
The workers are, for the most part, spenders. The great
bulk of their income is turned at once into consumption
goods. The owners in many instances are capitalists who
hold property for the purpose of turning the income de-
rived from it into additional investments.
Could the worker buy back dollar for dollar the values
which he produces there would be no surplus in the form of
rent, interest, dividends and profits. The present economic
system is, however, built upon the principle that those who
own the lands and the productive machinery should be rec-
ompensed for their mere ownership. It follows, of course,
that the more land and machinery there is to own the
greater will be the amount of surplus which will go to the
owners. Since surplus breeds surplus the owners find that
it pays them not to use all of their income in the form of
consumption, but rather to invest all that they can, thereby
increasing the share of surplus that is due them. The
worker, on the other hand, finds that he must produce a
constantly larger amount of wealth which he never gets,
but which is destined for the payment of rent, interest,
dividends and profits. Increased incomes yield increased
investments. Increased investments necessitate the creation
and payment of increased surplus. The payment of in-
creased surplus means increased incomes. Thus the circle
is continued-with the returns heaping up in the coffers of
the plutocracy.
on the machine follows:40 Owho the
THE AMERICAN EMPIRE
123
Originally the surplus was utilized to free the members
of the owning class from the grinding drudgery of daily
toil, by permitting them to enjoy the fruits of the labor of
others. Then it was employed in the exercise of power over
the enconomic and social machinery. But that was not
the end-instead it proved only the beginning. As
property titles were concentrated in fewer and fewer hands,
and the amount of property owned by single individuals or
groups of individuals becomes greater their incomes
(chiefly in the form of rent, interest, dividends and profits)
rose until by 1917 there were 19,103 persons in the United
States who declared incomes of $50,000 or more per year,
which is the equivalent of $1,000 per week. Among these
persons 141 declared annual incomes of over $1,000,000.
Besides these personal incomes, each industry which paid
these dividends and profits, through its depreciation, amorti-
zation, replacement, new construction, and surplus funds
was reinvesting in the industries billions of wealth that
would be used in the creation of more wealth. The normal
processes of the growth of the modern economic system has
forced upon the masters of life the problem of disposing
of an ever increasing amount of surplus.
During prosperous periods, the investment funds of a
community like England and the United States grow very
rapidly. The more prosperous the nation, the greater is the
demand from those who cannot spend their huge incomes
for safe, paying investment opportunities.
The immense productivity of the present-day system
of industry has added greatly to the amount of surplus
seeking investment. Each invention, each labor saving
device, each substitution of mechanical power that multi-
plies the productive capacity of industry at the same time
increases the surplus at the disposal of the plutocracy.
The surplus must be disposed of. There is no other
alternative. If hats, flour and gasoline are pilled up in the
warehouses or stored in tanks, no more of these commodities
will be made until this surplus has been used. The whole
economic system proceeds on the principle that for each
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commodity produced, a purchaser must be found before
another unit of the commodity is ordered. Demand for
commodities stimulates and regulates the machinery of
production.
Those in control of the modern economic system have no
choice but to produce surplus, and once having produced it,
they have no choice except to dispose of it. An inexorable
fate drives them onward-augmenting their burdens as it
multiplies their labors.
Investment opportunities, of necessity, are eagerly sought
by the plutocracy, since the law of their system is “Invest
or perish" !
Invest? Where? Where there is some demand for
surplus capital—that is in “undeveloped countries.”
The necessity for disposing of surplus has imposed upon
the business men of the world a classification of all countries
as “developed” or “undeveloped.” “Developed” coun-
tries are those in which the capitalist processes have gone far
enough to produce a surplus that is sufficient to provide
for the upkeep and for the normal expansion of industry.
In “developed” countries mines are opened, factories are
built, railroads are financed, as rapidly as needed, out of
the domestic industrial surplus. “Undeveloped” countries
are those which cannot produce sufficient capital for their
own needs, and which must, therefore, depend for industrial
expansion upon investments of capital from the countries
that do produce a surplus.
“Developed” countries are those in which the modern
industrial system has been thoroughly established.
The contrast between developed and undeveloped
countries is made clear by an examination of the invest-
ments of any investing nation, such as Great Britain.
Great Britain in 1913 was surrounded by rich, prosperous
neighbors-France, Germany, Holland, Belgium. Each
year about a billion dollars in English capital was invested
outside of the British Isles. Where did this wealth go?
The chief objectives of British investment, aside from the
THE AMERICAN EMPIRE
125
Argentlermany ot of Argentce were deti
British Dominions and the United States, were (stated in
millions of pounds) Argentine 320; Brazil 148; Mexico 99;
Russia 67; France 8 and Germany 6. The wealth of Ger-
many or France is greater than that of Argentine, Brazil
and Mexico combined, but Germany and France were de-
veloped countries, producing enough surplus for their
own needs, and, therefore, the investable wealth of Great
Britain went, not to her rich neighbors, but to the poorer
lands across the sea.
Each nation that produces an investable surplus-and
in the nature of the present economic system, every capi-
talist nation must some day reach the point where it can no
longer absorb its own surplus wealth-must find some un-
developed country in which to invest its surplus. Other-
wise the continuity of the capitalist world is unthinkable.
Great Britain, Belgium, Holland, France, Germany and
Japan all had reached this stage before the war. The
United States was approaching it rapidly.
3. “Undeveloped Countries”
Capitalism is so new that the active struggle to secure
investment opportunities in undeveloped countries is of the
most recent origin. The voyages which resulted in the
discovery, by modern Europeans, of the Americas, Aus-
tralia, Japan, and an easy road to the Orient, were all made
within 500 years. The actual processes of capitalism are
products of the past 150 years in England, where they had
their origin. In France, Germany, Italy and Japan they
have existed for less than a century. The great burst of
economic activity which has pushed the United States so
rapidly to the fore as a producer of surplus wealth dates
from the Civil War. Only in the last generation did there
arise the financial imperialism that results from the neces-
sity of finding a market for investable surplus.
The struggle for world trade had been waged for centuries
before the advent of capitalism, but the struggle for in-
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vestment opportunities in undeveloped countries is strictly
modern. The matter is strikingly stated by Amos Pinchot
in his “Peace or Armed Peace” (Nov. 11, 1918).
“If you will look at the maps following page 554 of
Hazen's ‘Europe since 1815,' or any other standard colored
map showing Africa and Asia in 1884, you will see that, but
for a few rare spots of coloration, the whole continent of
Africa is pure white. Crossing the Red Sea into Arabia,
Persia, Mesopotamia and Asia Minor, you will find the same
or rather a more complete lack of color. This is merely the
cartographer's way of showing, by tint and lack of tint,
that at that time Africa and Western Asia were still in the
hands of their native populations.
“Let us now turn to the same maps thirty years later, i.e.,
in 1914. We find them utterly changed. They are no
longer white, but a patch work of variegated hues. ...
“From 1870 to 1900, Great Britain added to her posses-
sions, to say nothing of her spheres of influence, nearly
5,000,000 square miles with an estimated population of
88,000,000. Within a few years after England's permanent
occupation of Egypt, which was the signal for the re-
naissance of French colonialism, France increased hers by
3,500,000 square miles with a population of 37,000,000, not
counting Morocco added in 1911. Germany, whose colonial-
ism came later, because home and nearby markets longer
absorbed the product of her machines, brought under her
dominion from 1884 to 1899 1,000,000 square miles with an
estimated population of 14,000,000.”
This is a picture of the political effects that followed the
cconomic causes summed up in the term "financial
imperialism.”
In the seventeenth and eighteenth centuries it was the
trader, dealing in raw stuff; in the nineteenth century it
was the manufacturer, producing at low cost to cut under
his neighbor's price. During the past thirty years the in-
vestment banker has occupied the foreground with his
efforts to find safe, paying opportunities for the disposal of
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127
the surplus committed to his care. British bankers, French
bankers, German bankers, Belgian bankers, Dutch bankers-
all intent upon the same mission--because behind all, and
relentlessly driving, were the accumulating surpluses, de-
manding an outlet. European bankers found that outlet in
Africa, Asia, Australia and the Americas. The stupendous
strides in the development of the resources in these countries
would have been impossible but for that surplus of Euro-
pean capital.
The undeveloped countries to-day have the same charac-
teristics,-virgin resources, industrial and commercial pos-
sibilities, and in many cases cheap labor. This is true, for
example, in China, Mexico and India. It is true to a less
extent in South America and South Africa. The logical
destination of capital is the point where the investment will
"pay."
The investor who has used up the cream of the home in-
vestment market turns his eyes abroad. As a recent writer
has suggested, “There is a glamor about the foreign invest-
ment” which does not hold for a domestic one. Foreign
investments have yielded such huge returns in the past that
there is always a seeming possibility of wonderful gains for
the future. The risk is greater, of course, but this is more
than offset by the increased rate of return. If it were
not so, the wealth would be invested at home or held idle.
4. The Great Investing Nations
• The great industrial nations are the great investing
nations. An agriculture community produces little surplus
wealth. Land values are low, franchises and special
privileges are negligible factors. There can be relatively
little speculation. Changes in method of production are in-
frequent. Changes in values and total wealth are gradual.
The owning class in an agriculture civilization may live
comfortably. If it is very small in proportion to the total
propulation it may live luxuriously, but it cannot derive
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THE AMERICAN EMPIRE
great revenues such as those secured by the owning classes
of an industrial civilization.
Industrial civilization possesses all of the factors for aug-
menting surplus wealth which are lacking in agricultural
civilizations. Changes in the forms of industrial produc-
tion are rapid ; special privilege yields rich returns and is
the subject of wide speculative activity; land values in-
crease; labor saving machinery multiplies man's capacity to
turn out wealth. As much surplus wealth might be pro-
duced in a year of this industrial life as could have been
turned out in a generation or a century of agricultural
activity or of hand-craft industry.
England, France, Germany, Holland, Belgium, Japan
and the United States, the great industrial nations, have
become the great lending nations. Their search forun-
developed territory” and “spheres of influence" is not a
search for trade, but for an opportunity to invest and ex-
ploit. If these nations wished to exchange cotton for coffee,
or machinery for wheat on even terms, they could exchange
with one another, or with one of the undeveloped countries,
but they demand an outlet for surplus wealth-an outlet
that can only be utilized where the government of the
developed country will guarantee the investment of its
citizens in the undeveloped territory.
The investing nations either want to take the raw prod-
ucts of the undeveloped country, manufacture them and
sell them back as finished material (the British policy in
India), or else they desire to secure possession of the re-
sources, franchises and other special privileges in the un-
developed country which they can exploit for their own
profit (the British policy in South America).
The Indians, under the British policy, are thus in rela-
tively the same position as the workers in one of the in-
dustrial countries. They are paid for their raw material
a fraction of the value of the finished product. They are
expected to buy back the finished product, which is a mani-
fest impossibility. There is thus a drastic limitation on the
THE AMERICAN EMPIRE
129
exploitation of undeveloped countries, just as there'is a
limitation on the exploitation of domestic labor. In both
cases the people as consumers can buy back less in value
than the exploiters have to sell. Obviously the time must
come when all the undeveloped sections of the world have
been exploited to the limit. Then surplus will go a-begging.
Some of the investors in the great exploiting nations have
abandoned the idea of making huge returns by way of the
English policy in India. Instead the investors in every na-
tion are buying up resources, franchises and concessions and
other special privileges in the undeveloped countries and
treating them in exactly the same way that they would treat
a domestic investment. In this case the resources and la-
bor of the undeveloped country are exploited for the profit
of the foreign investor.
The Roman conquerors subjugated the people politically
and then exacted an economic return in the form of trib-
ute. The modern imperialists do not bother about the
political machinery, so long as it remains in abeyance, but
content themselves with securing possession of the eco-
nomic resources of a region and exacting a return in in-
terest and dividends on the investment. Political tribute
is largely a thing of the past. In its place there is a new
form-economic tribute which is safer, cheaper, and on
the whole far superior to the Roman method of exploiting
undeveloped regions.
5. The American Home Field
A hundred years ago the United States was an unde-
veloped country. Its resources were virgin. Its wealth
possibilities were immense. Both domestic and foreign
capitalists invested large sums in the canals, the railroads
and other American commercial and industrial enterprises.
The rapid economic expansion of recent years has involved
the outlay of huge sums of new capital.
The total capital invested in manufactures was 8,975
· millions in 1899 and 22,791 millions in 1914. The total
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of railway capital was 11,034 millions in 1899 and 20,247
millions in 1914. Manufacturing and railroading alone
secured a capital outlay of over 20 billions in 15 years.
Some idea of the increase in investments may be gained
from the amount of new stocks and bonds listed annually
on the New York Stock Exchange. The total amount of
new stocks listed for the five years ending with 1914 was
(The Financial Review Annual, 1918, p. 67.) The total
capital of new companies (with an authorized capital of at
least $100,000) was in 1918, $2,599,753,600; in 1919, $12,-
677,229,600, and in the first 10 months of 1920, $12,242,-
577,700. (Bradstreets, Nov. 6, 1920, p. 731.) The figures
showing the amount of stocks and bonds issued do not by
any means exhaust the field of new capital. Reference has
already been made to the fact that the United States Steel
Corporation, between 1903 and 1918 increased its issues of
stocks and bonds by only $31,600,000, while, in the same
time its assets increased $987,000,000. The same fact is
illustrated, on a larger scale, in a summary (Wall Street
Journal, August 7, 1919) of the finances of 104 corpora-
tions covering the four years, December 31, 1914, to De-
cember 31, 1918. During this time, six of the leading steel
companies of the United States increased their working
capital by $461,965,000 and their surplus by $617,656,000.
This billion was taken out of the earnings of the com-
panies. Concerning the entire 104 corporations, the Jour-
nal notes that, “After heavy expenditures for new con-
struction and acquisitions, and record breaking dividends,
they added a total of nearly $2,000,000,000 to working
capital.” In addition, these corporations, in four years,
inventories of $1,522,000,000.
* Considerable amounts of capital are invested in private
industry, by individuals and partnerships. No record of
these investments ever appears. Farmers invest in ani-
mals, machinery and improved buildings-investments that
are not represented by stocks or bonds. Again, the great
corporations themselves are constantly adding to their as,
THE AMERICAN EMPIRE
131
sets without increasing their stock or bond issues. In
these and other ways, billions of new capital are yearly
absorbed by the home investment market.
Although most of the enterprises of the United States
have been floated with American capital, the investors of
Great Britain, Holland, France and other countries took a
hand. In 1913 the capitalists of Great Britain had larger
investments in the United States than in any other coun-
try, or than in any British Dominion. (The U. S., 754,-
617,000 pounds; Canada and Newfoundland, 514,870,000
pounds; India and Ceylon, 378,776,000 pounds; South Af-
rica, 370,192,000 pounds and so on. (Annals, 1916, Vol. 68,
p. 28, Article by C. K. Hobson.) The aggregate amount
of European capital invested in the United States was ap-
proximately $6,500,000,000 in 1910. Of this sum more
than half was British. (“Trade Balance of the United
States,” George Paisch. National Monetary Commission,
1910, p. 175.)
By the beginning of the present century (the U. S. Steel
Corporation was organized in 1901) the main work of or-
ganization inside of the United States was completed. The
bankers had some incidental tasks before them, but the
industrial leaders themselves had done their pioneer duty.
There were corners to be smoothed off, and bearings to be
rubbed down, but the great structural problems had been
solved, and the foundations of world industrial empire
had been laid.
6. Leaving the Home Field
The Spanish-American War marks the beginning of the
new era in American business organization. This war
found the American people isolated and provincial. It
left them with a new feeling for their own importance.
The worlds at home had been conquered. The trans-
continental railroads had been built; the steel industry, the
oil industry, the coal industry, the leather industry, the
woolen industry and a host of others had been organized
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by a whole generation of industrial organizers who had
given their lives to this task.
Across the borders of the United States-almost within
arm's reach of the eager, stirring, high-strung men of the
new generation, there were tens of thousands of square
miles of undeveloped territory-territory that was fabu-
lously rich in ore, in timber, in oil, in fertility. On every
side the lands stretched away~Mexico, the West Indies,
Central America, Canada—with opportunity that was to
be had for the taking.
Opportunity called. Capital, seeking new fields for in-
vestment, urged. Youth, enthusiasm and enterprise an-
swered the challenge.
The foreign investments of the United States at the time
of the Spanish-American War were negligible. By 1910
American business men had two billions invested abroad
$700,000,000 in Mexico; $500,000,000 in Canada; $350,-
000,000 in Europe, and smaller sums in the West Indies,
the Philippines, China, Central and South America. In
1913 there was a billion invested in Mexico and an equal
amount in Canada. (Commercial Policy,” W. S. Cul-
bertson, New York, Appleton, 1919, p. 315.)
Capital flowed out of the United States in two directions:
1. Toward the resources which were so abundant in cer-
tain foreign countries.
2. Toward foreign markets.
7. Building on Foreign Resources
The Bethlehem Steel Corporation is a typical industry
that has built up foreign connections as a means of ex-
ploiting foreign resources. The Corporation has a huge
organization in the United States which includes 10 manu-
facturing plants, a coke producing company, 11 ship build-
ing plants, six mines and quarries, and extensive coal de-
posits in Pennsylvania and West Virginia. The Bethlehem
Steel Corporation also controls ore properties near San-
THE AMERICAN EMPIRE
133
tiago, Cuba, near Nipe Bay, Cuba, and extensive deposits
along the northern coast of Cuba; large ore properties ai
Tofo, Chile, and the Ore Steamship Corporation, a carry-
ing line for Chilean and Cuban ore.
The American Smelting and Refining Company is an-
other illustration of expansion into a foreign country for
the purpose of utilizing foreign resources. According to
the record of the Company's properties, the Company was
operating six refining plants, one located in New Jersey;
one in Nebraska; one in California; one in Illinois; one in
Maryland, and one in Washington. The Company owned
14 lead smelters and 11 copper smelters, located as follows:
Montana, 1; Washington, 1; Nebraska, 1; California, 1;
Illinois, 1; Chile, 2; Mexico, 6. Among these 25 plants a
third is located outside of the United States.
These are but two examples. The rubber, oil, tobacco and
sugar interests have pursued a similar policy-extending
their organization in such a way as to utilize foreign re-
sources as a source for the raw materials that are destined
to be manufactured in the United States.
8. Manufacturing and Marketing Abroad
The Bethlehem Steel Corporation and the American
Smelting and Refining Company go outside of the United
States for the resources upon which their industries de-
pend. Their fabricating industries are carried on inside of
the country. There are a number of the great industries
of the country that have gone outside of the United States
to do their manufacturing and to organize the marketing
of their products.
The International Harvester Company has built a world-
wide organization. It manufactures harvesting machinery,
farm implements, gasoline engines, tractors, wagons and
separators at Springfield, Ohio; Rock Falls, Ill. ; Chicago,
Ill. ; Auburn, New York; Akron, Ohio; Milwaukee, Wisc.,
134,
THE AMERICAN EMPIRE
steed three hes are enmark: Berl
and West Pullman, Ill. It has iron mines, coal mines and
steel plants operated by the Wisconsin Steel Company. It
has three twine mills and four railways. Foreign plants
and branches are listed as follows: Norrkoping, Sweden;
Copenhagen, Denmark; Christiania, Norway; Paris,
France; Croix, France; Berlin, Germany; Hamilton, On-
tario, Canada; Zurich, Switzerland; Vienna, Austria ; Lu-
bertzy, Russia; Neuss, Germany; Melbourne, Australia;
London, England; Christ Church, New Zealand.
One of the greatest industrial empires in the world is
the Standard Oil Properties. It is not possible to go into
detail with regard to their operations. Space will admit
of a brief comment upon one of the constituent parts or
"states" of the empire-The Standard Oil Company of
New Jersey. With a capital stock of $100,000,000, this
Company, from the dissolution of the Standard Oil Com-
pany, December 15, 1911, to June 15, 1918, a period of
six and a half years, paid dividends of $174,058,732.
The company describes itself as "a manufacturing enter-
prise with a large foreign business. The company drills
oil wells, pumps them, refines the crude oil into many
forms and sells the product-mostly abroad." (The Lamp,
May, 1918.) The properties of the Company are thus
listed:
1. The Company has 13 refineries, seven of them in New
Jersey, Maryland, Oklahoma, Louisiana and West Virginia.
Four of the remaining refineries are located in Canada, one
is in Mexico and one in Peru.
2. Pipeline properties in New York, New Jersey, Penn-
sylvania and Maryland.
3. A fleet of 54 ocean-going tank steamers with a ca-
pacity of 486,480 dead weight tons. (This is about two
per cent of the total ocean-going tonnage of the world.)
4. Can and case factories, barrel factories, canning
plants, glue factories and pipe shops.
5. Through its subsidiary corporations, the Company
controls:
THE AMERICAN EMPIRE
135
a. Oil wells in Pennsylvania, West Virginia, Ohio, Ken-
tucky, Louisiana, Arkansas, Mississippi, Texas, California,
Peru and Mexico. In connection with many of these prop-
erties refineries are operated.
b. One subsidary has 550 marketing stations in Canada.
Others market in various parts of the United States; in
the West Indies; in Central and South America; in Ger-
many, Austria, Roumania, the Netherlands, France, Den-
mark and Italy.
The Standard Oil Company of New Jersey comprises
only one part-though a very successful part of the Stand-
ard Oil Group of industries. It is one industrial state in
a great industrial empire.
Foreign resources offer opportunities to the exploiter.
Foreign markets beckon. Both calls have been heeded by
the American business interests that are busy building the
international machinery of business organization.
9. International Business and Finance
11
The steel, smelting, oil, sugar, tobacco, and harvester
interests are confined to relatively narrow lines. In their
wake have followed general business, and above all, finan-
cial activities.
The American International Corporation was described
by its vice-president (Mr. Connick) before a Senate Com-
mittee on March 1, 1918. “Until the Russian situation be-
came too acute, they had offices in Petrograd, London,
Paris, Rome, Mexico City. They sent commissions and
agents and business men to South America to promote
trade. ... They were negotiating contracts for a thousand
miles of railroad in China. They were practically rebuild-
ing, you might say, the Grand Canal in China. They had
acquired the Pacific Mail. ... They then bought the New
York Shipbuilding Corporation to provide ships for their
shipping interests."
136
THE AMERICAN EMPIRE
By 1919 (New York Times, Oct. 31, 1919) the Company
had acquired Carter Macy & Co., and the Rosin and Tur-
pentine Export Co., and was interested in the International
Mercantile Marine and the United Fruit Companies.
Another illustration of the same kind of general foreign
business appeared in the form of an advertisement inserted
on the financial page of the New York Times (July 10,
1919) by three leading financial firms, which called at-
tention to a $3,000,000 note issue of the Haytian American
Corporation “Incorporated under the laws of the State of
New York, owning and operating sugar, railroad, wharf .
and public utility companies in the Republic of Hayti.”
Further, the advertisers note: “The diversity of the Com-
pany's operations assures stability of earnings.”
American manufacturers, traders and industrial empire
builders have not gone alone into the foreign field. The
bankers have accompanied them.
Several of the great financial institutions of the country
are advertising their foreign connections.
The Guaranty Trust Company (New York Times, Jan.
10, 1919) advertises under the caption “Direct Foreign
Banking Facilities” offering “a direct and comprehensive
banking service for trade with all countries.” These con-
nections include:
1. Branches in London and Paris, which are designated
United States depositories. "They are American institu-
tions conducted on American lines, and are especially well
equipped to render banking service throughout Europe.”'
There are additional branches in Liverpool and Brussels.
The Company also has direct connections in Italy and
Spain, and representatives in the Scandinavian countries.
2. "Direct connections with the leading financial insti-
tutions in Argentina, Uruguay, Chile, and Brazil." A spe-
cial representative in Buenos Ayres. “Through our affilia-
tion with the Mercantile Bank of the Americas and its
connections, we cover Peru, Northern Brazil, Columbia,
THE AMERICAN EMPIRE
137
British Phireet, baner direct can Mercountries. uatemala, ana
Ecuador, Venezuela, Nicaragua, Honduras, Guatemala, and
other South and Central American countries.”
3. "Through the American Mercantile Bank of Cuba,
at Havana, we cover direct Cuba and the West Indies.”
4. “Direct banking and merchant service throughout
British India,” together with correspondents in the East
Indies and the Straits Settlements.
5. "Direct connections with the National Bank of South
Africa, at Cape Town, and its many branches in the Trans-
vaal, Rhodesia, Natal, Mozambique, etc.”
6. Direct banking connections and a special representa-
tive in Australia and New Zealand.
7. "Through our affiliations with the Asia Banking Cor-
poration we negotiate, direct, banking transactions of every
nature in China, Manchuria, Southeastern Siberia, and
throughout the Far East. The Asia Banking Corporation
has its main office in New York and is establishing branches
in these important trade centers: Shanghai, Pekin, Tient-
sin, Hankow, Harbin, Vladivostok. We are also official
correspondents for leading Japanese banks."
The advertisement concludes with this statement: “Our
Foreign Trade Bureau collects and makes available accurate
and up-to-date information relating to foreign trade-ex-
port markets, foreign financial and economic conditions,
shipping facilities, export technique, etc. It endeavors to
bring into touch buyers and sellers here and abroad."
The same issue of the Times carries a statement of the
Mercantile Bank of the Americas which offers the sery-
ices of a banking organization with branches and affiliated
banks in important trade centers throughout Central and
South America, France and Spain.” The Bank describes
itself as “an American Bank for Foreign trade." Among
its eleven directors are the President and two Vice-Presi-
dents of the Guaranty Trust Company.
The Asia Banking Corporation, upon which the Guar-
anty Trust Company relies for its Eastern connections, was
organized in 1918 “to engage in international and foreign
138
THE AMERICAN EMPIRE
sions of the United States, and, ultimately in Siberia”
(Standard Corporation Service, May-August, 1918, p. 42).
The officers elected in August 1918, were Charles H. Sabin,
President of the Guaranty Trust Co., President; Albert
Breton, Vice-President of the Guaranty Trust Co., and
Ralph Dawson, Assistant Secretary of the Guaranty Trust
Company, Vice-Presidents, and Robert A. Shaw, of the
overseas division of the Guaranty Trust Company, Treas-
urer. Among the directors are representatives of the Bank-
ers Trust Company and of the Mercantile Bank of the
Americas.
10. The National City Bank
The National City Bank of New York--the first bank in
the history of the Western Hemisphere to show resources
exceeding one billion dollars-illustrates in its develop-
ment the cyclonic changes that the past few years have
brought into American business circles. The National City
Bank, originally chartered in 1812, had resources of $16,-
750,929 in 1879 and of $18,214,823 in 1889. From that
point its development has been electric. The resources of
1909; $1,039,418,324 in 1919. Between 1889 and 1899 they
increased 600 per cent; between 1899 and 1919 they in-
creased 700 per cent; during the 40 years from 1889 and
1919 the increase in resources exceeded six thousand per
cent.
The organization of the Bank is indicative of the organi-
zation of modern business. Among the twenty-one direc-
tors, all of whom are engaged in some form of business
enterprise, there are the names of William Rockefeller,
Percy A. Rockefeller, J. Ogden Armour, Cleveland H.
Dodge of the Phelps-Dodge Corporation, Cyrus H. MC-
Cormick of the International Harvester Co., Philip A. S.
Franklin, President of the International Mercantile Ma-
rine Co., Earl D. Babst, President of the American Sugar
Refining Co.; Edgar Palmer, President of the New Jersey
THE AMERICAN EMPIRE
139
Zinc Co.; Nathan C. Kingsbury, Vice-President of the Un-
ion Pacific Railroad Co., and Frank Krumball, Chairman
of the Chesapeake & Ohio Railroad Co. Some of the most
powerful mining, manufacturing, transportation and pub-
lic utility interests in the United States are represented,
directly or indirectly, in this list.
The domestic organization of the Bank consists of five
divisions, each one under a vice-president. New York City
constitutes the first division; the second division comprises
New England and New York State outside of New York
City; the three remaining divisions cover the other por-
tions of the United States. Except for the size and the
completeness of its organization, the National City Bank
differs in no essential particulars from numerous other
large banking institutions. It is a financial superstructure
built upon a massive foundation of industrial enterprise.
The phase of the Bank's activity that is of peculiar sig-
nificance at the present juncture is its foreign organization,
all of which has been established since the outbreak of the
European war.
The foreign business of the National City Bank is car-
ried on by the National City Bank proper and the Inter-
national Banking Corporation. The first foreign branch
of the National City Bank was established at Buenos Aires
on November 10th, 1914. On January 1st, 1919, the Na-
tional City Bank had a total of 15 foreign branches; on
December 31st, 1919, it had a total of 74 foreign branches.
The policy of the Bank in its establishment of foreign
branches is, described thus in its “Statement of Condition,
December 31st, 1919': "The feature of branch develop-
ment during the year was the expansion in Cuba, where
twenty-two new branches were opened, making twenty-four
in the island. Cuba is very prosperous, as a result of the
expansion of the sugar industry, and as sugar is produced
there under very favorable conditions economically, and the
location is most convenient for supplying the United States,
the industry is on a sound basis, and relations with the
140
THE AMERICAN EMPIRE
Bank which was tontin City Boom
#1077 of them al Banocated Java,
United States are likely to continue close and friendly,
Cuba is a market of growing importance to the United
States, and the system of branches established by the Bank
is designed to serve the trade between the two countries."
The trader and the Banker are to work hand in hand.
The National City Bank has branches in Argentina,
Brazil, Belgium, Chile, Colombia, Cuba, Italy, Porto Rico,
Russia, Siberia, Spain, Trinidad, Uruguay and Venezuela,
all of which have been established since 1914.
A portion of the foreign business of the National City
Bank is conducted by the International Banking Corpora-
tion which was established in 1902 and which became a
part of the National City Bank organization in 1915. The
International Banking Corporation has a total of twenty-
eight branches located in California, China, England,
France, India, Japan, Java, Dominican Republic, Philip-
pine Islands, Republic of Panama and the Straits Settle-
ments. Under this arrangement, the financial relations
with America are made by the National City Bank proper;
while those with Europe and Asia are in the hands of the
International Banking Corporation and the combination
provides the Bank with 75 branches in addition to its vast
organization within the United States.
The National City Bank of 1889, with its resources of
eighteen millions, was a small affair compared with the
billion dollar resources of 1920. Thirty years sufficed for
a growth from youth to robust adulthood. Within five
years, the Bank built up a system of foreign branches that
make it one of the most potent States in the federation of
international financial institutions.

ank with 15 poration and the hands of the
11. Onward
Exploiters of foreign resources, manufacturers, traders
and bankers have moved, side by side, out of the United
States into the foreign field. Step by step they have ad-
vanced, rearing the economic structure of empire as they
went.
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141
The business men of the United States had no choice.
They could not pause when they had spanned the continent.
Ambition called them, surplus compelled them, profits
lured them, the will to power dominated their lives. As
well expect the Old Guard to pause in the middle of a
charge-even before the sunken road at Waterloo as to
expect the business interests of the United States to cease
their efforts and lay down their tools of conquest simply be-
cause they had reached the ocean in one direction. While
there were left other directions in which there was no
ocean; while other undeveloped regions offered the possi-
bility of development, an inexorable fate—the fate inherent
in the economic and the human stuff with which they were
working compelled them to cry “Onward !” and to turn to
the tasks that lay ahead.
The fathers and grandfathers of these Twentieth Cen-
tury American Plutocrats, working coatless in their tiny
factories; managing their corner stores; serving their lo-
cal banks, and holding their minor offices had never
dreamed of the destiny that lay ahead. No matter. The
necessity for expansion had come and with it came the op-
portunity. The economic pressure complemented the hu-
man desire for "more.” The structure of business organi-
zation, which was erected to conquer one continent could
not cease functioning when that one continent was sub-
dued. Rather, high geared and speeded up as it was, it
was in fine form to extend its conquests, like the well
groomed army that has come scatheless through a great
campaign, and that longs, throughout its tensely unified
structure to be off on the next mission.
The business life of the United States came to the Pa-
cific; touched the Canadian border; surged against the Rio
Grande. The continent had been spanned; the objective
had been attained. Still, the cry was “Onward!”
Onward? Whither?
Onward to the lands where resources are abundant and
rich; onward where labor is plentiful, docile and cheap; on-
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THE AMERICAN EMPIRE
ward where the opportunities for huge profits are met
with on every hand; onward into the undeveloped coun-
tries of the world. .
The capitalists of the European nations, faced by a
similar necessity for expansion, had been compelled to go
half round the earth to India, to South Africa, to the East
Indies, to China, to Canada, to South America. Close at
home there was no country except Russia that offered great
possibilities of development.
The business interests of the United States were more
fortunate. At their very doors lay the opportuniteismin
Canada, in Mexico, in the West Indies, in Central and
richest resources; countries open for capitalist development.
To be sure these investment fields had been invaded al-
ready by foreign capitalists--British, German, Belgian and
Spanish. But at the same time they were surrounded by
a tradition of great virility and power--the tradition of
"America for the Americans.”
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143
XI. THE GREAT WAR
1. Daylight
THE work of industrial empire building had continued
for less than half a century when the United States en-
tered the Great War, which was one in a sequence of
events that bound America to the wheel of destiny as it
bound England and France and Germany and Japan and
every other country that had adopted the capitalist method
of production.
The war-test revealed the United States to the world and
to its own people as a great nation playing a mighty rôle
in international affairs. Most Europeans had not suspected
the extent of its power. Even the Americans did not re-
alize it. Nevertheless, the processes of economic empire
building had laid a foundation upon which the super-
structure of political empire is reared as a matter of
course. Henceforth, no one need ask whether the United
States should or should not be an imperial nation. There
remained only the task of determining what form Ameri-
can imperialism should take.
The Great War rounded out the imperial beginnings of
the United States. It strengthened the plutocracy at
home; it gave the United States immense prestige abroad.
The Era of Imperialism dawned upon the United States
in 1898. Daylight broke in 1914, and the night of isola-
tion and of international unimportance gave place to a new
day of imperial power.
2. Plutocracy in the Saddle
The rapid sweep across a new continent had placed the
resources of the United States in the hands of a powerful
minority. Nature had been generous and private owner.
ship of the inexhaustible wilderness seemed to be the nat-
ural-the obvious method of procedure.
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THE AMERICAN EMPIRE
The lightning march of the American people across the
continent gave the plutocracy its grip on the natural re-
sources. The revolutionary transformations in industry
guaranteed its control of the productive machinery.
The wizards of industrial activity have changed the struc-
ture of business life even more rapidly than they have con-
quered the wilderness. True sons of their revolutionary
ancestors, they have slashed and remodeled and built anew
Revolutions are the stalking grounds of predatory power.
Napoleon built his empire on the French Revolution ; Crom-
well on the revolt against tyrannical royalty in England.
Peaceful times give less opportunity to personal ambition.
Institutions are well-rooted, customs and habits are firmly
placed, life is regulated and held to earth by a fixed frame-
work of habit and tradition.
Revolution comes—fiercely, impetuously—uprooting insti-
tutions, overthrowing traditions, tearing customs from
their resting places. All is uncertainty-chaos, when, lo!
a man on horseback gathers the loose strands together say.
ing, “Good people, I know, follow me!”
He does know; but woe to the people who follow him!
Yet, what shall they do? Whither shall they turn? How
hour?
The man on horseback rises in his stirrups-speaking in
mighty accents his message of hope and cheer, reassuring,
promising, encouraging, inspiring all who come within the
sound of his voice. His is the one assurance in a wilder-
ness of uncertainty. What wonder that the people follow
where he leads and beckons!
The revolutionary changes in American economic life be-
tween the Civil War and the War of 1914 gave the plu-
tocrat his chance. He was the man on horseback, quick,
clever, shrewd, farseeing, persuasive, powerful. Through
the courses of these revolutionary changes, the Hills,
Goulds, Harrimans, Wideners, Weyerhausers, Guggen-
THE AMERICAN EMPIRE
145
heims, Rockefellers, Carnegies, and Morgans did to the
American economic organization exactly what Napoleon
did to the French political organization—they took pos-
session of it.
3. Making the Plutocracy Be Good
17
The American people were still thinking the thoughts of
a competitive economic life when the cohorts of an organ-
ized plutocracy bore down upon them. High prices, trusts,
millionaires, huge profits, corruption, betrayal of public
office took the people by surprise, confused them, baffled
them, enraged them. Their first thought was of politics,
and during the years immediately preceding the war they
were busy with the problem of legislating goodness into
the plutocracy.
The plutocrats were in public disfavor, and their con-
trol of natural resources, banks, railroads, mines, factories,
political parties, public offices, governmental machinery, the
school system, the press, the pulpit, the movie business -
all of this power amounted to nothing unless it was backed
by public opinion.
How could the plutocracy-the discredited, vilified plu-
tocracy-get public opinion? How could the exploiters
gain the confidence of the American people? There was
only one way—they must line up with some cause that
would command public attention and compel public sup-
port. The cause that it chose was the "defense of the
United States.”
How could public opithe American with some public suhe
4. “Preparedness"
The plutocracy, with a united front, "went in" for the
"defense of the United States,”'--attacking the people on
the side of their greatest weakness; playing upon their
primitive emotions of fear and hate. The campaign was
intense and dramatic, featuring Japanese invasions, Mexi-
can inroads, and a world conquest by Germany.
146
THE AMERICAN EMPIRE
appearing incHowe showing
The preparedness campaign was a marvel of efficient
business organization. Its promoters made use of every
device known to the advertising profession; the best brains
were employed, and the country was blanketed with pre-
paredness propaganda.
Officers of the Army and Navy were frank in insisting
that the defense of the United States was adequately pro-
vided for. (See testimony of General Nelson A. Miles.
Congressional Record, February 3, 1916, p. 2265.) Still
the preparedness campaign continued with vigor. Con-
gressman Clyde H. Tavenner in his speech, “The Navy
League Unmasked,” showed why. He gave facts like those
apppearing in George R. Kirkpatrick's book, “War, What
For”); in F. C. Howe's “Why War," and in J. A. Hob-
son's "Imperialism,” showing that, in the words of an
English authority, "patriotism at from 10 to 15 per cent
is a temptation for the best of citizens.”
Tavenner established the connection between the pre-
paredness campaign and those who were making profits out
of the powder business, the nickel business, the copper busi-
ness, and the steel business, interlocked through interlock-
ing directorates; then he established the connection between
the Navy League and the firm of J. P. Morgan & Co., 23
Wall St., New York. Regarding this connection, Congress-
man Tavenner said, "The Navy League upon close exam-
ination would appear to be little more than a branch office
of the house of J. P. Morgan & Co., and a general sales
promotion bureau for the various armor and munition
makers and the steel, nickel, copper and zinc interests.” 1
The preparedness movement came from the business in-
terests. It was fostered and financed by the plutocrats.
It was their first successful effort at winning public con-
fidence, and so well was it managed that millions of Ameri.
cans fell into line, fired by the love of the flag and the
sal managed that millions of Amen
world-old devotion to family and fireside.
1 “The Navy League Unmasked,” Speech of December 15, 1915.
Congressional Record.
THE AMERICAN A
147
EMPIRE
5. Patriots
From preparedness to patriotism was an easy step. The
preparedness advocates had evoked the spirit of the foun-
ders of American democracy and worked upon the emo-
tions of the people until it was generally understood that
those who favored preparedness were patriots.
Plutocratic patriotism was accepted by the press, the pul-
pit, the college, and every other important channel of pub-
lic information in the United States. Editors, ministers,
professors and lawyers proclaimed it as though it were
their own. Randolph Bourne, in a brilliant article (Seven
Arts, July, 1917) reminds his readers of the virtuous
horror and stupefaction when they read the manifesto of
their ninety-three German colleagues in defense of the war.
To the American academic mind of 1914 defense of war
was inconceivable. From Bernhardi it recoiled as from a
blasphemy, little dreaming that two years later would find
it creating its own cleanly reasons for imposing military
service on the country and for talking of the rough rude
currents of health and regeneration that war would send
through the American body politic. They would have
thought any one mad who talked of shipping American
men by the hundreds of thousands-conscripts--to die on
the fields of France. ..."
The American plutocracy was magnified, deified, and con-
secrated to the task of making the world safe for democracy.
Exploiters had turned saviors and were conducting a cam-
paign to raise $100,000,000 for the Red Cross. The "male-
factors of great wealth,” the predatory business forces, the
special privileged few who had exploited the American peo-
ple for generations, became the prophets and the crusaders,
2 This campaign was conducted by H. P. Davison, one of the lead-
ing members of the firm of J. P. Morgan and Co. Later a great war-
fund drive was conducted by John D. Rockefeller, Jr. Cleveland H.
Dodge of the Phelps-Dodge corporation was treasurer of another
fund.
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THE AMERICAN EMPIRE
the keepers of the ark of the covenant of American democ-
racy.
Radicals who had always opposed war, ministers who had
spent their lives preaching peace upon earth, scientists
whose work had brought them into contact with the peo-
ples of the whole world, public men who believed that the
United States could do greater and better work for democ-
racy by staying out of the war, were branded as traitors
and were persecuted as zealously as though they had sided
with Protestantism in Catholic Spain under the Inquisition.
By a clever move, the plutocrats, wrapped in the flag and
proclaiming a crusade to inaugurate democracy in Ger-
many, rallied to their support the professional classes of
the United States and millions of the common people.
6. Business in Control
After the declaration of war, the mobilization and direc-
tion of the economic war work of the government was
placed in the hands of the Council of National Defense, an
organized group of the leading business men. The Coun-
cil consisted of six members of the President's Cabinet,
assisted by an Advisory Commission and numerous sub-
committees. The “Advisory Commission of the Council
(the real working body) contained four business men, an
educator, a labor leader and a medical' man. (“The Coun-
cil of National Defense" a bulletin issued by the Council
under date of June 28, 1917.)
Each member of the Advisory Commission had a group
of persons coöperating with him. The make-up of these
various committees was significant. Among 706 persons
listed in the original schedule of sub-committees, 404 were
business men, 200 were professional men, 59 were labor
men, 23 were public officials and 20 were miscellaneous.
It was only in Mr. Gompers' group that labor had any
representation, and even there, out of 138 persons only 59
were workers or officials of unions, while 34 were business
THE AMERICAN EMPIRE
149
companiesrsons, all of the Leather Indon, Mr.
men and 33 professional men, so that among Mr. Gompers'
assistants the business and professional men combined con.
siderably outnumbered the labor men.
The make-up of some of the sub-committees revealed the
forces behind the Defense Council. Thus Mr. Willard's
sub-committee on “Express” consisted of four vice-presi-
dents, one from the American, one from the Wells-Fargo,
one from the Southern and one from the Adams Express
Company. His committee on "Locomotives"' consisted of
the Vice-President of the Porter Locomotive Company, the
President of the American Locomotive Company, and the
Chairman of the Lima Locomotive Corporation. Mr.
Rosenwald's committee on “Shoe and Leather Industries”
consisted of eight persons, all of them representing shoe
or leather companies. His committee on “Woolen Manu-
factures” consisted of eight representatives of the woolen
industry. The same business supremacy appeared in Mr.
Baruch's committees. His committee on “Cement" con-
sisted of the presidents of four of the leading cement com-
panies, the vice-president of a fifth cement company, and
a representative of the Bureau of Standards of Wash-
ington. His committee on “Copper” had the names of
the presidents of the Anaconda Copper Company, the Calu-
met & Hecla Mining Company, the United Verde Copper
Company and the Utah Copper Company. His committee
on “Steel and Steel Products” consisted of Elbert H. Gary,
Chairman of the United States Steel Corporation; Charles
M. Schwab, of the Bethlehem Steel Company; A. C. Dinkey,
Vice-President of the Midvale Steel Company; W. L. King,
Vice-President of Jones & Loughlin Steel Company, and
J. A. Burden, President of the Burden Steel Company.
The four other members of the committee represented the
Republic Iron and Steel Company, the Lackawanna Steel
Company, the American Iron and Steel Institute and the
Picklands, Mather Co., of Cleveland. Perhaps the most
astounding of all the committees was that on-Oil.” The
chairman was the President of the Standard Oil Company,
and the secretary of the committee gives his address as
“26 Broadway,” the address of the Standard Oil Com-
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THE AMERICAN EMPIRE
pany. The other nine members of the committee were oil
men from various parts of the country. What thinking
American would have suggested, three years before, that
the Standard Oil Company would be officially directing a
part of the work of the Federal Government?,
Comment is superfluous. Every great industrial enter-
prise of the United States had secured representation on
the committees of business men that were responsible for
the direction of the economic side of war making.
Then came the Liberty Loan campaigns and Red Cross
drives, the direction of which also was given into the hands
of experienced business men. In each community, the
leaders in the business world were the leaders in these war-
time activities. Since the center of business life was the
bank, it followed that the directing power in all of the war.
time campaigns rested with the bankers, and thus the whole
nation was mobilized under the direction of its financiers.
The results of these experiences were far-reaching. Dur-
ing two generations, the people of the United States had
been passing anti-trust laws and anti-pooling laws, the aim
of which was to prevent the business men of the country
from getting together. The war crisis not only brought
them together, but when they did assemble, it placed the
whole political and economic power of the nation in their
hands.
The business men learned, by first hand experience, the
benefits that arise from united effort. They joined forces
across the continent, and they found that it paid. James
S. Alexander, President of the National Bank of Com-
merce (New York), tells the story from the standpoint of
a banker (Manchester Guardian, January 28, 1920. Signed
Article.) In a discussion of "the experience in coöperative
action which the war has given American banks” he says,
“The responsibility of floating the five great loans issued
by the government, together with the work of financing a
production of materials speeded up to meet war necessities,
enforced a unity of action and coöperation which otherwise
could hardly have been obtained in many years."
THE AMERICAN EMPIRE
151
7. Economic Winnings
The war gains of the plutocracy in the field of public
control were important, as well as spectacular. Behind
them, however, were economic gains-little heralded, but
of the most vital consequence to the future of plutocratic
power.
The war speeded production and added greatly to the
national income, to investable surplus, to profits and thus
to the economic power of the plutocrats.
The most tangible measure of the economic advantage
gained by the plutocracy from the war is contained in a
report on “Corporate Earnings and Government Rev.
enues” (Senate Document 259. 65th Congress, Second
Session). This report shows the profits made by the va-
rious industries during 1917—the first war year.
The report contains 388 large pages on which are listed
the profits (“percent of net income to capital stock in
1917'') made by various concerns. A typical food produc-
ing industry—“meat packing"?lists 122 firms (p. 95 and
365). Of these firms 31 reported profits for the year of
less than 25 percent; 45 reported profits of 25 but under
50 percent; 24 reported profits of 50 but under 100 per-
cent, and 22 reported profits of 100 percent or more. In
this case, a third of the profits were more than 25, but less
than 50 percent, and half were 50 percent or over.
Manufacturers of cotton yarns reported profits ranging
slightly higher than those in the meat packing industry (pp.
167, 168, 379). Among the 153 firms reporting, 21 re-
ported profits of less than 25 percent; 61 reported 25 but
less than 50 per cent; 55 reported 50 but under 100 per-
cent, and 16 reported 100 percent or more.
Profits in the garment manufacturing industry were
lower than those in yarn manufacturing. Among the 299
firms reporting (pp. 171, 380) 74 gave their profits as less
than 25 percent; 121 gave their profits as 25 but under 50
152
THE AMERICAN EMPIRE
percent; 65 gave profits of 50 but less than 100 percent,
and 39 gave their profits as 100 percent or over.
The profits of 49 Steel plants and Rolling Mills (pp. 100,
365) were considerably higher than profits in any of the in-
dustries heretofore discussed. Four firms reported profits of
less than 25 percent; 13 reported profits of 25 but less than
50 percent; 17 reported profits of 50 but less than 100
percent, and 15 reported profits of more than 100 percent.
In this instance two-thirds of the firms show profits of 50
percent or over.
Bituminous Coal producers in the Appalachian field (340
in number, pp. 130 and 372) report a range of profits
far higher than those secured in the manufacturing in-
dustries. Among these 340 firms, 23 reported profits of
less than 25 percent; 45 reported profits of 25 but under
50 percent; 79 reported profits of 50 but under 100 per-
cent; 135 reported profits of 100 but under 500 percent; 21
reported profits of 500 but under 1,000 percent, and 14
reported profits of 1,000 percent and over. In the case of
these coal mine operators only a fourth had profits of un-
der 50 percent and half had profits of more than 100 per-
cent.
The profits in these five industries-food, yarn, cloth-
ing, steel and coal-are quite typical of the figures for the
tens of thousands of other firms listed in Senate Docu-
ment 259. Profits of less than 25 percent are the excep-
tion. Profits of over 100 percent were reported by 8 per-
oent of the yarn manufacturers, by 13 percent of the gar-
ment manufacturers, by 18 percent of the meat packers, by
31 percent of the steel plants, and by 50 percent of the
bituminous coal mines. A considerable number of profits
ranged above 500 percent, or a gain in one year of five
times the entire capital stock.
When it is remembered that these figures were supplied
by the firms involved; that they were submitted to a tre-
mendously overworked department, lacking the facilities
for effective checking-up; and that they were submitted for
the purposes of heavy taxation, the showing is nothing les3
than astounding.
gent of Profits rofits of otheite typ
THE AMERICAN EMPIRE
153
8. Winnings in the Home Field
What has the American plutocracy won at home as a
result of the war? In two words it has gained social
prestige and internal (economic) solidarity. Both are vital
as the foundation for future assertions of power.
The plutocracy has unified its hold upon the country as
a result of the war. Also, it has won an important battle
in its struggle with labor. The position held by the Ameri-
can plutocracy at the end of the Great War could hardly
be stated more adequately than in a recent Confidential
Information Service furnished by an important agency to
American business men:
“SHALL VICTORS BE MAGNANIMOUS ?
“There is no doubt about it-Labor is beaten. Mr.
Gompers was at his zenith in 1918. Since then he has
steadily lost power. He has lost power with his own peo-
ple because he is no longer able to deliver the goods. He
can no longer deliver the goods for two reasons. For one
thing, peace urgency has replaced war urgency and we are
not willing to bid for peace labor as we were willing to bid
for war labor. For another thing, the employing class is
immensely more powerful than it was in 1914.
“We have an organized labor force more numerous than
ever before. Relatively twice as many workers are organ-
ized as in 1916. But this same labor force has lost its hold
on the public. Furthermore, it is divided in its own camp.
It fears capital. It also fears its own factions. It threat-
ens, but it does not dare.
“We said that the employing class was immensely more
powerful than in 1914. There is more money at its com-
mand. Eighteen thousand new millionaires are the war's
legacy. This money capacity is more thoroughly unified
than ever. In 1914 we had thirty-thousand banks, func-
tioning to a great degree in independence of each other.
Then came the Federal Reserve Act and gave us the ma-
154
THE AMERICAN EMPIRE
chinery for consolidation and the emergency of five years
war furnished the hammer blows to weld the structure into
one.
“The war taught the employing class the secret and the
power of widespread propaganda. Imperial Europe had
been aware of this power. It was new to the United States.
Now, when we have anything to sell to the American peo-
ple we know how to sell it. We have learned. We have
the schools. We have the pulpit. The employing class
owns the press. There is practically no important paper
in the United States but is theirs !"
9. The Run of the World
The war gains of the American plutocracy at home were
immense. Even more significant, from an imperial stand-
point, were the international advantages that came to
America with the war. The events of the two years be-
tween 1916 and 1918 gave the United States the run of the
world.
Destiny seemed to be bent upon hurling the American
people into a position of world authority. First, there was
the matter of credit. The Allies were reaching the end
of their economic rope when the United States entered the
war. They were not bankrupt, but their credit was
strained, their industries were disorganized, their sources
of income were narrowed, and they were looking anxiously
for some source from which they might draw the immense
volume of goods and credit that were necessary for the con-
tinuance of the struggle.
3 J. Maynard Keynes notes the "immense anxieties and impossible
financial requirements” of the period between the Summer of 1916
and the Spring of 1917. The task would soon have become "en-
tirely hopeless” but “from April, 1917” the problems were “of an
entirely different order.” “The Economic Consequences of the Peace."
New York, Harcourt, Brace & Howe, 1920, p. 273.
THE AMERICAN EMPIRE
155
The United States was that source of supply. During
the years from 1915 to 1917, the industries of the United
States were shifted gradually from a peace basis to a war
basis. Quantities of material destined for use in the war
were shipped to the Allies. The unusual profits made on
much of this business were not curtailed by heavy war taxa-
tion. Thus for more than two years the basic industries
of the United States reaped a harvest in profits which were
actually free of taxation, at the same time that they placed
themselves on a war basis for the supplying of Europe's
war demand. When the United States did enter the war,
she came with all of the economic advantages that had
arisen from selling war material to the belligerents during
two and a half years. Throughout those years, while the
Allies were bleeding and borrowing and paying, the Ameri-
can plutocracy was growing rich.
When the United States entered the war, she entered it
as an ally of powers that were economically winded. She
herself was fresh. With the greatest estimated wealth of
any of the warring countries, she had a public national
debt of less than one half of one percent of her total wealth.
She had larger quantities of liquid capital and a vast eco-
nomic surplus. As a consequence, she held the purse
strings and was able, during the next two years, to lend to
the Allied nations nearly ten billion dollars without strain-
ing her resources to any appreciable degree.
The nations of Europe had been so deeply engrossed in
war-making that they had been unable to provide themselves
with the necessary food. All of the warring countries,
with the exception of Russia, were importers of food in
normal times. The disturbances incident to the war; the
insatiable army demands, and the loss of shipping all had
their effect in bringing the Allied countries to a point of
critical food scarcity in the Winter of 1916-1917.
The United States was able to meet this food shortage
as easily as it met the European credit shortage and with
no greater sacrifice on the part of the American people.
Then, too, with the exception of small amounts of food
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THE AMERICAN EMPIRE
donated through relief organizations, the food that went to
Europe was sold at fancy prices. The United States was
therefore in a position to lay down the basic law,-“Submit
or starve."
With the purse strings and the larder under American
control, the temporary supremacy of the United States was
assured. She was the one important nation (beside Japan)
that had lost little and gained much during the war. She
was the only great nation with a surplus of credit, of raw
materials and of food.
The prosperity incident to this period is reflected in the
record of American exports, which rose from an average of
about two billions in the years immediately preceding the
war to more than six billions in 1917, In the same year
the imports were just under three billions, leaving a trade
balance that is, a debt owing by foreign countries to the
United States of more than three billions for that one
year.
10. Victory
The war had been in progress for nearly three years be-
fore the United States took her stand on the side of the
Allies. At that time the flower of Europe's manhood had
faced, for three winters, a fearful pressure of hardship
and exposure, while millions among the non-combatants
had suffered, starved, sickened and died. The nerves of
Europe were worn and the belly of Europe was empty when
the American soldiers entered the trenches. They were
never compelled to bear the brunt of the conflict. They
arrived when the Central Empires were sagging. Their
mere presence was the tokex of victory.
For the first time in history the Americans were matched
against the peoples of the old world on the home ground
of the old world, and under circumstances that were
enormously favorable to the Americans. European capi.
talism had weakened itself irreparably. The United States
THE AMERICAN EMPIRE
157
entered the war at a juncture that enabled her to take the
palm after she had already taken billions of profit without
risk or loss. The gain to the United States was immense,
beyond the possibility of present estimate. The rulers of
the United States became, for the time being, at least, the
economic dictators of the world.
The Great War brought noteworthy advantages to the
American plutocracy. At home its power was clinched.
Among the nations, the United States was elevated by the
war into a position of commanding importance. In a
superficial sense, at least, the Great War "made” the plu-
tocracy at home and “made” the United States among the
nations.
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THE AMERICAN EMPIRE
XII. THE IMPERIAL HIGHROAD.
1. A Youthful Traveler
ALONG the highroad that leads to empire moves the
American people, in the heyday of its youth, sturdy,
vigorous, energy-filled, replete with power and promise-
conquerors who have swept aside the Indians, enslaved a
race of black men, subdued a continent, and begun the ex-
tension of territorial control beyond their own borders.
More than a hundred million Americans-fast losing their
standards of individualism--fast slipping under the domina-
tion of a new-made ruling class of wealth-lords and pluto-
cratsjourney, not discontentedly, along the imperial
highroad.
The preliminary work of empire-building has been ac-
complished_territory has been conquered; peoples have
been subjected and a ruling class organized. The policy
of imperialism has been accepted by the people, although
they have not thought seriously of its consequences. They
have set out, in good faith, as they believe, to seek for life,
liberty and happiness. They do not yet realize that, along
the road that they are now traveling, the journey will not
be ended until they have worn themselves threadbare in
their efforts to conquer the earth.
The American people,-lacking in political experience
and in world wisdom; ignorant of the laws of economic and
social change, have committed themselves, unwittingly, to
the world old task of setting up authority over those who
have no desire to accept it, and of exacting tribute from
those who do not wish to pay it.
The early stages of the journey led across a continent.
The American people followed it eagerly. Now that the
trail leads to other continents they are still willing to go.
THE AMERICAN EMPIRE
159
“Manifest destiny” is the cry of the leaders. “We are
called," echo the followers, and the nation moves onward.
There was some hesitancy among the American people
during the Spanish War. Even the leaders were not ready
then. Now the leaders are prepared-for markets, for
trade, for investments. They are indifferent to political
conquest, but economically they are prepared to go on-
into Latin America; into Asia; into Europe. The war
taught them the lesson and gave them an inkling of their
power. So they move along the imperial highroad-
followed by a people who have not yet learned to chant the
songs of victory--but who are destined, at no very distant
date, to learn victory's lessons and to pay victory's price.
Along the path,far away in the distance, they see the
earth like a ball, rolling at their feet. It is theirs if they
will but reach out their hands to grasp it!
.
2. An Imperial People
This is the American people-locked in the arms of
mighty economic and social forces; building industrial em-
pires; compelled, by a world war, to reach out and save
“civilization,”—capitalist civilization,-a people that, by its
very ancestry, seems destined to follow the course of
empire.
The sons and daughters of the native born American
stock are, in the main, the descendants of the conquering,
imperial races of the modern world. During recent times,
three great empires-Spain, France and Great Britain
have dominated western civilization. It was these three
empires that were responsible for the settlement of America.
The past generation has seen the German empire rise to a
position that has enabled her to shake the security of the
world. The Germans were among the earliest and most
numerous settlers of the American colonies. Those who
boast colonial ancestry boast the ancestry of conquerors.
The Anglo-Saxon-Teutonic races, the titular masters of the
160
THE AMERICAN EMPIRE
:
..
modern world; the races that have spread their power where-
ever ships sail or trade moves or gain offers, furnished the
bulk of the early immigrants to America.
The bulk of the early immigration to the United States was
from Great Britain and Germany. The records of im-
migration (kept officially since 1820) show that between
that year and 1840 the immigrants from Europe num-
bered 594,504, among them there were 358,994 (over
half) from the British Isles, and 159,215 from Ger- :
many, making a total from the two countries of 518,209, or
87 percent of the immigrants arriving in the twenty-year
period. During the next twenty years (1840-1860) the
total of immigrants from Europe was 4,050,159, of which
the British Isles furnished 2,386,846 (over half) and Ger-
many 1,386,293, making, for these two countries, 94 percent
of the whole immigration. Even during the years from
1860 to 1880, 82 percent of those who migrated to the
United States hailed from Great Britain and Germany.
American immigration, from 1820 to 1880, might, without
any violence to facts, be described as Anglo-Teutonic, so
completely does the British-German immigrant dominate
this period.
Literally, it is true that the American people have been
sired by the masters and would-be masters of the modern
earth.
1860" whole in making, ed. 2,386.814 as 4,0567840-18667-year
3. A Place in the Sun
The Americans, like many another growing people, have
sought a place in the sun-widening their boundaries;
grasping at promised riches. Unlike other peoples they
have accomplished the task without any real opposition.
Their "promised land” lay all about them, isolated from
the factional warfare of Europe; virgin; awaiting the
master of the Western World.
The United States has followed the path of empire with
a facility unexampled in recent history. When has a people,
caught in the net of imperialism, encountered less difficulty
THE AMERICAN EMPIRE
161
nited Stareak of 369,00 miles, les) e the
in making its imperial dream come true? None of the foes
that the American people have encountered, in two centuries
of expansion, have been worthy of the name. The Indians
were in no position to withstand the onslaught of the
Whites. The Mexicans were even less competent to defend
themselves. The Spanish Empire crumpled, under attack,
like an autumn leaf under the heel of a hunter. Practically
for the taking, the American people secured a richly-stocked,
compact region, with an area of three millions of square
miles the ideal site for the foundation of a modern civili.
zation.
The area of the United States has increased with mar-
velous rapidity. At the outbreak of the Revolution (1776)
the Colonies claimed a territory of 369,000 square miles.
The Northwest Territory (275,000 square miles) and the
area south of the Ohio River (205,000 square miles) were
added largely as a result of the negotiations in 1782. The
official figures for 1800 give the total area of the United
States as 892,135 square miles. The Louisiana Purchase
(1803) added 885,000 square miles at a cost of 15 millions
of dollars. Florida, 59,600 square miles, was purchased
from Spain (1819) for 5 millions of dollars; Texas, 389,000
square miles was annexed in 1845; the Oregon Country,
285,000 square miles, was secured by treaty in 1846; New
Mexico and California, 529,000 square miles, were ceded by
Spain (1848) and a payment of 15 millions was made by the
United States; in 1853 the Gadsen Purchase added 30,000
square miles at a cost of ten millions of dollars. This com-
pleted the territorial possessions of the United States on the
mainland (with the exception of Alaska) making a conti-
mental area of 3,026,798 square miles. Between 1776 and
1853 the area of the United States was increased more than
eight fold. What other nation has been in a position to
multiply its home territory by eight in two generations?
These vast additions to the continental possessions of the
United States were made as the result of a trifling outlay.
The most serious losses were involved in the Mexican War
when the casualties included more than 13,000 killed and
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THE AMERICAN EMPIRE
died of wounds and disease. The net money cost of the
war did not exceed $100,000,000. In return for this outlay
-including the annexation of Texas—the United States
secured 918,000 square miles of land.
There is no way to estimate the loss of life or the money
cost of the Indian Wars. For the most part, the troops
engaged in them suffered no more heavily than in ordinary
police duty, and the costs were the costs of maintaining
the regular army. The total money outlay for purchases
and indemnities was about 45 millions of dollars. Within
a century the American people gained possession of one of
the richest portions of the earth's surfaces—a portion
equal in area to more than three times the combined acreage
of Belgium, France, Germany, Italy, Japan and the British
Isles 2-in return for an outlay in money and life that would
not have provided for one first class battle of the Great
War.
Additions to the territory of the country were made with
equal facility during the period following the Civil War.
Alaska was purchased from Russia for $7,200,000; from
Spain, as a result of the War of 1898, the United States
received the Philippines, Porto Rico, and some lesser is-
lands, at the same time paying Spain $20,000,000; Hawaii
was annexed and an indemnity of $10,000,000 was paid to
Panama for the Canal strip. During the second half of
the nineteenth century, 716,666 square miles were added
to the possessions of the United States. The total direct
cost of this territory in money was under forty millions.
These gains involved no casualties with the exception of
the small numbers lost during the Spanish-American and
Philippine Wars.
One hundred and thirty years have witnessed an addi-
tion to the United States of more than two and a half mil-
lion square miles of contiguous, continental territory, and
1 “New American History," A. B. Hart. American Book Co., 1917,
p. 348.
2 The total area of these countries, exclusive of their colonies, is
807,123 square miles.
THE AMERICAN EMPIRE
163
three-quarters of a million square miles of non-contiguous
territory. The area of the United States in 1900 was four
times as great as it was in 1800 and more than ten times
as great as the area of the Thirteen Original Colonies. For
the imperialist, the last century and a half of American
history is a fairyland come true.
Other empires have been won by the hardest kind of
fighting, during which blood and wealth have been spent
with a lavish hand. The empire of the French, finally
crushed with the defeat of Napoleon, was paid for at such
a huge price. The British Empire has been established in
savage competition with Holland, Spain, France, Russia,
the United States, Germany and a host of lesser powers.
The empires of old-Assyria, Egypt, Rome_were built at
an intolerable sacrifice. So terrible has been the cost of
empire building to some of these nations that by the time
they had succeeded in creating an empire the life blood
of the people and the resources of the country were de-
voured and the empire emerged, only to fall an easy prey
to the first strong-handed enemy that it encountered.
No such fate has overtaken the United States. On the
contrary her path has been smoothed before her feet. In-
habiting a garden spot, her immense territory gains in the
past hundred and fifty years have been made with less ef-
fort than it has cost Japan to gain and hold Korea or Eng-
land to maintain her dominion over Ireland.
Once established, the old-world empire was not secure.
If the territory that it possessed was worth having, it was
surrounded by hungry-eyed nations that took the first oc-
casion to band together and despoil the spoiler. The hold-
ing of an empire was as great a task as the building of
empire-often greater because of the larger outlay in men
and money that was involved in an incessant warfare.
Little by little the glory faded; step by step militarism
made its inroads upon the normal life of the people, until
the time came for the stronger rival to overthrow the mighty
one, or until the inrushing hordes of barbarians should blot
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THE AMERICAN EMPIRE
out the features of civilization, and enthrone chaos once
more.
How different has been the fate of the people of the
United States! Possessed of what is probably the richest,
for the purposes of the present civilization, of any terri-
tory of equal size in the world, their isolation has allowed
them more than a century of practical freedom from out-
side interference-a century that they have been able to
devote to internal development. The absence of greedy
neighbors has reduced the expense of military preparation
to a minimum; the old world has failed to realize, until
within the last few years, what were the possibilities of the
new country; vitality has remained unimpaired, wealth has
piled up, industry has been promoted, and on each occasion
when a greater extent of territory was required, it has been
obtained at a cost that, compared with the experience of
other nations, must be described as negligible.
So simple has been the process of empire building for
the United States ; so natural have been the stages by which
the American Empire has been evolved; so little have the
changes disturbed the routine of normal life that the Amer-
ican people are, for the most part, unaware of the imperial
position of their country. They still feel, think and talk
as if the United States were a tiny corner, fenced off from
the rest of the world to which it owed nothing and from
which it expected nothing.
V The American Empire has been built, as were the pal-
aces of Aladdin, in a night. The morning is dawning, and
the early risers who were not even awakened from their
slumbers by the sound of hammer and engine, are begin-
ning to rub their eyes, and to ask one another what is the
meaning of this apparition, and whether it is real.
4. The Will to Power
The forces of America are the forces of Empire,—the
geography, the economic organization, the racial qualities-
all press in the direction of imperialism. There is logic
THE AMERICAN EMPIRE
165
behind the two ceuturies of conquest in which the Ameri-
can people have been engaged; there is logic in the rise
of the plutocracy. Now it remains for the rulers of Amer-
ica to accept the implications of imperialism,—to thrill with
the will to power; to recognize and strengthen inperial pur-
pose; to sell imperialism to the American people in other
words to follow the call of manifest destiny and conquer
the earth.
The will to power is very old and very strong. Eco-
nomic and social necessity on the one hand, and the driving
pressure of human ambition and the love of domination on
the other, have given it a front place in human affairs. The
empires of the past were driven into being by this ardent
force. As far back as history bears a record, one nation
or tribe has made war on its more fortunately situated
neighbor; one leader has made cause against his fellow
ruler. The Egyptians and Carthaginians have conquered
in Africa; the Persians, Assyrians and Babylonians con-
quered in Asia; the Macedonians, Greeks, Romans, Span-
ish, Dutch, French, and British built their empires on one
or more of the five continents. Conqueror has succeeded
conqueror, empire has followed empire. Spoils, domination,
world power, have been the objects of their campaigns.
Each great nation grew from small beginnings. Each
arose from some simple form of tribal or clan organiza-
tion-more or less democratic in its structure; containing
within itself a unified life and a simple folk philosophy.
From such plain beginnings empires have developed.
The peasants, tending their fertile gardens along the bor-
ders of the Nile; the vine dressers of Italy, the husbandmen
and craftsmen of France and the yeomen of Merry Eng-
land had no desire to subjugate the world. If tradition
speaks truth, they were slow to take upon themselves any.
thing more than the defense of their own hearthstones. It
was not until the traders sailed across the seas; not until
stories were brought to them of the vast spoil to be had,
without work, in other lands, that the peasants and crafts-
men consented to undertake the task of conquest, subjuga-
tion and empire building.
166
THE AMERICAN EMPIRE
The plain people do not feel the will to power. They
know only the necessities of self-defense. It is in the am-
bitions of the leisure classes that the demands of conquest
have their origin. It is among them that men dream of
world empire.3
The plain people of the United States have no will to
power at the present time. They are only asking to be
let alone, in order that they may go their several ways in
peace. They are babes in the world of international poli-
tics. For generations they have been separated by a great
gulf of indifference from the remainder of the human race,
and they crave the continuance of this isolation because it
gives them a chance to engage, unmolested, in the ordinary
pursuits of life.
The American people are not imperialists. They are
proud of their country, jealous of her honor, willing to
make sacrifices for their dear ones. They are to-day where
the plain folk of Egypt, Rome, France and England were
before the will to power gripped the ruling classes of those
countries.
Far different is the position of the American plutocracy.
As a ruling class the plutocracy feels the necessity of pre-
serving and enlarging its privileges. Recently called into
a position of leadership, untrained and in a sense unpre-
pared, it nevertheless understands that its claim to con-
sideration depends upon its ability to do what the ruling
classes of Egypt, Rome, France and England have done-
to build an empire.
Almost unconsciously, out of the necessities of the period,
has come the structure of the American Empire. In es-
sence it is an empire, although the plain people do not
know it, and even the members of the plutocracy are in
many instances unaware of its true character. Yet here, in
a land dedicated to liberty and settled by men and women
who sought to escape from the savage struggles of empire-
3 See "Theory of the Leisure Class," Thorstein Veblen. New York,
Hucbsch, 1918, Ch. 10.
THE AMERICAN EMPIRE
167
ridden Europe, the foundations and the superstructure of
empire appear.
1. The people of the United States have conquered and
now hold possession of approximately three million square
miles of continental territory that has been won by armed
force from Great Britain, Mexico, Spain, and the American
Indians. (The entire area of Europe is only 3,800,000
square miles.)
2. The people of the United States have conquered and
now hold under their sway subject people who have en-
joyed no opportunity for self-determination. A whole
race the African Negroes—was captured in its native
land, transported to America and there sold into slavery.
The inhabitants of the Philippine Islands were conquered
by the armed forces of the United States and still are sub-
ject people.
3. The United States had developed a plutocracy-a
property holding class, that is, to all intents and purposes,
the imperialist class--controlling and directing public
policy.
4. This plutocratic class is exploiting continental United
States and its dependencies. After years of savage internal
strife, it has developed a high degree of class conscious-
ness, and led by its bankers, it is taking the fat of the land.
The plutocrats, who have made the country their United
States, are at the present moment busy disposing of their
surplus in foreign countries. As they build their indus-
trial empires, they broaden and deepen their power.
Thus is the round of imperialism complete. Here are
the conquered territory, subject people, an imperial rul-
ing class, and the exploitation, by this class, of the lands
and peoples that come within the scope of their power.
These are the attributes of empire-the characteristics that
have appeared, in one form or another, through the great
empires of the past and of the present day. Differing in
their forms, they remain similar in the principles that they
represent. They are imperialism.
broadenies. As busy
168
THE AMERICAN EMPIRE
5. Imperial Purpose
The building of international industrial empires by the
progressive business men of the United States lays the
foundation for whatever political imperialism is necessary
to protect markets, trade and investment. Gathering floods
of economic surplus are the driving forces which are guided
by ambition and love of gain and power.
The United States emerged from the Great War in a
position of unquestioned economic supremacy. With vast
stores of all the necessary resources, amply equipped with
capital, the country has entered the field as the most dan-
gerous rival that the other capitalist nations must face.
Possessed of everything, including the means of providing
a navy of any reasonable size and an army of any necessary
number, the United States looms as the dominating eco-
nomic factor in the capitalist world.
Imperial policy is frequently bold, rough and at times
frankly brutal and unjust. Where subject peoples and
weaker neighbors submit to the dictates of the ruling power
there is no friction. But where the subject peoples or
smaller states attempt to assert their rights of self-
determination or of independence, the empire acts as Great
Britain has acted in Ireland and in India; as Italy and
France have acted in Africa; as Japan has acted in Korea;
as the United States has acted in the Philippines, in Hayti,
in Nicaragua, and in Mexico.
Plain men do not like these things. Animated by the
helief in popular rights which is so prevalent among the
western peoples, the masses resent imperial atrocities.
Therefore it becomes necessary to surround imperial action
with such an atmosphere as will convince the man on the
street that the acts are necessary or else that they are in-
evitable.
When the Church and the State stood together the Czar
and the Kaiser spoke for God as well as for the financial
interests. There was thus a double sanction--imperial ne-
determinhas acted in Africted
THE AMERICAN EMPIRE
169
cessity coupled with divine authority. Those who were not
willing to accept the necessity felt enough reverence for
the authority to bow their heads in submission to what-
ever policy the masters of empire might inaugurate.
The course of empire upon which the United States has
embarked involves a complete departure from all of the
most cherished traditions of the American people. Eco-
nomic, political and social theories must all be thrust aside.
Liberty, equality and fraternity must all be forgotten and
in their places must be erected new standards of imperial
heyat quantitahaterte aust
purpose that are acceptable to the economic and political
masters of present day American life.
The American people have been taught the language of
liberty. They believe in freedom for self-determination.
Their own government was born as a protest against im-
perial tyranny and they glory in its origin and speak
proudly of its revolutionary background. Americans are
still individualists. Their lives and thoughts both have
been provincial--perhaps somewhat narrow. They profess
the doctrine “Live and let live" and in a large measure
they are willing and anxious to practice it.
How is it possible to harmonize the Declaration of In-
dependence with the subjugation of peoples and the con-
quest of territory? If governments “derive their just
powers from the consent of the governed,” and if it is the
right of a people to alter or to abolish any government
which does not insure their safety and happiness, then
manifestly subjugation and conquest are impossible.
The letter and the spirit of the Declaration of Inde-
pendence contradict the letter and spirit of imperial pur-
pose word for word and line for line. There can be no
harmony between these two theories of social life.
and cond the Declaol imperia be no
pose
ce contradict th spirit of the De impossible.
. 5. Advertising Imperialism
Since the tradition of the people of the United States
and the necessities of imperialism are so utterly at variance,
it becomes necessary to convince the American people that
170
THE AMERICAN EMPIRE
they should abandon their traditions and accept a new
order of society, under which the will to power shall be
substituted for liberty and fraternity. The ruling class
of imperial Germany did this frankly and in so many
words. The English speaking world is more adroit.
The first step in the campaign to advertise and justify
imperialism is the teaching of a blind my-country-right-or-
wrong patriotism. In the days preceding the war the idea
was expressed in the phrase, “Stand behind the President.”
The object of this teaching is to instill in the minds of the
people, and particularly of the young, the principles of
“Deutschland über alles,” which, in translation, means
“America first." There are more than twenty million
children in the public schools of the United States who are
receiving daily lessons in this first principle of popular
support for imperial policy.
í Having taken this first step and made the state supreme
Vover the individual will and conscience, the imperial class
makes its next move--for "national defense.” The coun-
try is made to appear in constant danger from attack.
Men are urged to protect their homes and their families.
are mostational preplain people as superit languascles.". The
large enough to hold off aggressors. The same forces that
are most eager to preach patriotism are the most anxious
about national preparedness.
Meanwhile the plain people are taught to regard them-
selves and their civilization as superior to anything else
N on earth. Those who have a different language or a dif-
ferent color are referred to as “inferior peoples.” The
people of Panama cannot dig a canal, the people of Cuba
cannot drive out yellow fever, the people of the Philippines
cannot run a successful educational system, but the people
of the United States can do all of these things, therefore
they are justified in interferring in the internal affairs of
Panama, Cuba and the Philippines. When there is a
threat of trouble with Mexico, the papers refer to “clean-
ing up Mexico” very much as a mother might refer to clean-
ing up a dirty child.
THE AMERICAN EMPIRE
171
Patriotism, preparedness and a sense of general superior-
ity lead to that type of international snobbery that says,
“Our flag is on the seven seas''; or "The sun never sets
on our possessions”; or “Our navy can lick anything on
earth.” The preliminary work of “Education'' has now
been done; the way has been prepared.
One more step must be taken, and the process of im-
perializing public opinion is complete. The people are told
that the imperialism to which they have been called is the
work of “manifest destiny."
7. Manifest Destiny
The argument of "manifest destiny" is employed by the
strong as a blanket justification for acts of aggression
against the weak. Each time that the United States has
come face to face with the necessity of adding to its terri-
tory at the expense of some weak neighbor, the advocates
of expansion have plied this argument with vigor and with
uniform success.
The American nation began its work of territorial ex-
pansion with the purchase of Louisiana. Jefferson, who
had been elected on a platform of strict construction of the
Constitution, hesitated at an act which he regarded as
“beyond the Constitution." (Jefferson's "Works," Vol.
IV, p. 198.) Quite different was the language of his more
imperialistic contemporaries. Gouverneur Morris said,
“France will not sell this territory. If we want it, we must
adopt the Spartan policy and obtain it by steel, not by
gold.” 4 During February, 1803, the United States Sen-
ate debated the closing of the Mississippi to American com-
merce, "To the free navigation of the Mississippi we had
an undoubted right from nature and from the position of
the Western country,” 5 said Senator Ross (Pennsylvania)
4 “A History of Missouri,” Louis Houck. Chicago, R. R. Donnelly
& Sons, 1908, vol. II, p. 346.
5 “History of Louisiana,” Charles Gayarre. New Orleans, Hansell
& Bros., Ltd., 1903, vol. III, p. 478.
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THE AMERICAN EMPIRE
on February 14. On February 23rd Senator White (Dela-
ware) went a step farther: “You had as well pretend to
dam up the mouth of the Mississippi, and say to the rest-
less waves, ‘Ye shall cease here, and never mingle with the
ocean,' as to expect they (the settlers) will be prevented
from descending it.” 6 On the same day (February 23rd)
Senator Jackson (Georgia) said: “God and nature have
destined New Orleans and the Floridas to belong to this
great and rising Empire."?
God, nature and the requirements of American commerce
were the arguments used to justify the purchase, or if
necessary, the seizure of New Orleans. The precedent has
been followed and the same arguments presented all
through the century that followed the momentous decision
to extend the territory of the United States.
Some reference has been made to the Mexican War and
the argument that the Southwest was a "natural" part of
the territory of the United States. The same argument
was made in regard to Cuba and by the same spokesmen
of the slave-power. Stephen A. Douglas (New Orleans,
December 13, 1858) was asked:
“How about Cuba ?”
"It is our destiny to have Cuba," he answered, “and
you can't prevent it if you try.” 8
On another occasion (New York, December, 1858) Doug-
las stated the matter even more broadly:
"This is a young, vigorous and growing nation and must
obey the law of increase, must multiply and as fast as we
multiply we must expand. You can't resist the law if you
try. He is foolish who puts himself in the way of Ameri-
can destiny."!
President McKinley stated that the Philippines, like
Cuba and Porto Rico, "were intrusted to our hands by the
6 Ibid., p. 485.
7 Ibid., p. 486.
8 McMaster's "History of the American People.”
9 Ibid., p. 339.
Vol. VIII, p. 339.
THE AMERICAN EMPIRE
173
Providence of God” (Boston, February 16, 1899), and one
of his fellow imperialists-Senator Beveridge of Indiana-
carried the argument one step farther (January 9, 1900)
when he said in the Senate (Congressional Record, January
9, 1900, p. 704): "The Philippines are ours forever. ...
And just beyond the Philippines are China's illimitable
markets. We will not retreat from either. We will not
repudiate our duty to the archipelago. We will not aban-
don our opportunity in the Orient. We will not renounce
our part in the mission of our race, trustee, under God, of
the civilization of the world.”
Manifest destiny is now urged to justify further acts
of aggression by the United States against her weaker neigh-
bors. The Chicago Tribune, discussing the Panama Canal
and its implications, says editorially (May 5, 1916): “The
Panama Canal has gone a long way towards making our
shore continuous and the intervals must and will be filled
up; not necessarily by conquest or even formal annexa-
tion, but by a decisive control in one form or another.'
Here the argument of manifest destiny is backed by the
argument of “military necessity,”-the argument that led
Great Britain to possess herself of Gibraltar, Suez and a
score of other strategic points all round the earth, and to
maintain, at a ruinous cost, a huge navy; the argument
that led Napoleon across Europe in his march of bloody,
fatal triumph; the argument that led Germany through
Belgium in 1914 one of the weakest and yet one of the
most seductive and compelling arguments that falls from
the tongue of man. Because we have a western and an
eastern front, we must have the Panama Canal. Because
we have the Panama Canal, we must dominate Central
America. The next step is equally plain; because we dom-
inate Central America and the Panama Canal, there must
be a land route straight through to the Canal. In the
present state of Mexican unrest, that is impossible, and
therefore we must dominate Mexico.
The argument was stated with persuasive power by ex-
Senator Albert J. Beveridge (Collier's Weekly, May 19,
11
174
THE AMERICAN EMPIRE
1917). "Thus in halting fashion but nevertheless surely,
the chain of power and influence is being forged about the
Gulf. To neglect Mexico is to throw away not only one link
but a large part of that chain without which the value and
usefulness of the remainder are greatly diminished if indeed
not rendered negligible." By a similar train of logic, the
entire American continent, from Cape Horn to Bering
V Sea can and will be bronght under the dominion of the
United States.
Some destiny must call, some imperative necessity must
beckon, some divine authority must be invoked. The cam-
paign for “100 percent Americanism,” carefully thought
out, generously financed and carried to every nook and
corner of the United States aims to prove this necessity.
The war waged by the Department of Justice and by other
public officers against the “Reds” is intended to arouse in
the American people a sense of the present danger of im-
pending calamity. The divine sanction was expressed by
President Wilson in his address to the Senate on July 10,
1919. The President discussed the Peace Treaty in some of
its aspects and then said, “It is thus that a new responsi-
bility has come to this great nation that we honor and that
we would all wish to lift to yet higher service and achieve-
ment. The stage is set, the destiny disclosed. It has come
about by no plan of our conceiving but by the hand of God
who has led us into this war. We cannot turn back. We
can only go forward, with lifted and freshened spirit to
follow the vision."
8. The Open Road
The American people took a long step forward on Novem-
ber 2, 1920. The era of modern imperialism, begun in 1896
annexation of Hawaii; the conquest of Cuba and the Philip.
pines; the seizure of Panama, and a rapid commerical and
financial expansion into Latin America. In 1912 the Re-
publicans were divided. The more conservative elements
backed Taft for reëlection. The more aggressive group
THE AMERICAN EMPIRE
175
(notably United States Steel) supported Roosevelt. Be-
tween them they divided the Republican strength, and while
they polled a total vote of 7,604,463 as compared with Wil-
son's 6,293,910, the Republican split enabled Wilson to
secure a plurality of 2,173,512, although he had less than
half of the total vote.
President Wilson entered office with the ideals of
“The New Freedom.” He was out to back the “man
on the make,” the small tradesman and manufacturer;
the small farmer; the worker, ambitious to rise into
the ranks of business or professional life. With the sup-
port, primarily, of little business, Wilson managed to hold
his own for four years, and at the 1916 election to poll
a plurality, over the Republican Party, of more than half
a million votes. He won, however, primarily because “he
kept us out of war.” April, 1917, deprived him of that
argument. His “New Freedom" doctrines, translated into
international politics (in the Fourteen Points) were roughly
handled in Paris. The country rejected his leadership in
the decisive Congressional elections of 1918, and he and his
party went out of power in the avalanche of 1920, when
Harding received a plurality nearly three times as great
as the highest one ever before given a presidential candi-
date (Roosevelt, in 1904). Every state north of the Mason
and Dixon Line went Republican. Tennessee left the Solid
South and joined the same party. The Democrats carried
only eleven states—the traditional Democratic stronghold.
The victory of Harding is a victory for organized, im-
perial, American business. The “man on the make" is
brushed aside. In his place stands banker, manufacturer
and trader, ready to carry American money and American
products into Latin America and Asia.
Before the United States lies the open road of imperial-
ism. Manifest destiny points the way in gestures that can-
not be mistaken. Capitalist society in the United States has
evolved to a place where it must make certain pressing de-
mands upon neighboring communities. Surplus is to be
invested; investments are to be protected, American author-
176
THE AMERICAN EMPIRE
ity is to be respected. All of these necessities imply the
exercise of imperial power by the government of the United
States.
Capitalism makes these demands upon the rulers of capi-
talist society. There is no gainsaying them. A refusal to
comply with them means death.
Therefore the American nation, under the urge of eco-
nomic necessity; guided half-intelligently, half-instinctively
by the plutocracy, is moving along the imperial highroad,
and woe to the man that steps across the path that lcads
to their fulfillment. He who seeks to thwart imperial des-
tiny will be branded as traitor to his country and as blas-
phemer against God.
THE AMERICAN EMPIRE
177
XIII. THE UNITED STATES AS A WORLD
COMPETITOR
1. A New World Power
YOUNGEST among the great nations, the United States
holds a position of immense world power. Measured in
years and compared with her sister nations in Europe and
Asia, she is a babe. Measured in economic strength she is
a burly giant. Young America is, but mighty with a vast
economic strength.
An inexorable destiny seems to be forcing the United
States into a position of international importance. Up to
the time of the Spanish War, she played only a minor part
in the affairs of the world. The Spanish War was the
turning point--the United States as a borrowing nation
gave way then, to the United States as an investing nation
Economic forces compelled the masters of economic life to
look outside of the country for some of their business oppor-
tunities.
Since the Civil War the United States has been preparing
herself for her part in world affairs. During the thirty
years that elapsed between 1870 and 1900 she emerged from
a position of comparative economic inferiority to take a
position of notable economic importance. Between the
years 1870 and 1900 the population of the United States
increased 97 per cent. During the same period the annual
production of wheat increased from 236 million bushels
to 522 million bushels; the annual production of corn from
1,094 to 2,105 million bushels; the annual production of cot-
ton from 4,352 to 10,102 thousand bales; the annual pro-
duction of coal from 29 to 241 million tons; the annual
production of petroleum from 221 to 2,672 million gallons ;
the annual production of pig iron from 1,665 to 13,789
thousand tons; the annual production of steel from 68 to
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THE AMERICAN EMPIRE
10,188 thousand tons; the annual production of copper
from 12 to 271 thousand tons, and the production of cement
(there is no record for 1870) rose from two million barrels
in 1880 to 17 million barrels in 1900. Thus while the pro-
duction of food more than kept pace with the increase of
population, the production of those commodities upon which
the new industry depends-coal, petroleum, iron, steel,
copper and cement-increased many times more rapidly
than the population. During one brief generation the
United States, with almost unbelievable rapidity, forged
ahead in the essentials for supremacy in the new world of
industry.
By the time of the Spanish War (1898) American indus-
tries had found their stride. During the next fourteen
years they were overtaking their European competitors in
seven league boots. Between 1900 and 1914 while the popu-
lation of the United States increased by 30 per cent -
Wheat production increased..... 70 per cent
Corn production increased.......
Cotton production increased......
Coal production increased........
Petroleum production increased.. 317 66
Pig Iron production increased..., 69
Steel production increased....... 13
Copper production increased....! 89" "
Cement production increased..... 4066
The United States was rushing toward a position of eco-
nomic world power before the catastrophe of 1914 hurled
her to the front, first as a producer (at immense profits)
for the Allies, and later as the financier of the final stages
of the War.
The economic position that is now held by the United
States among the great competing nations of the world
can be in some measure suggested—it cannot be adequately
stated-by a comparison of the economic position of the
United States and some of the other leading world empires.
66
58 66
THE AMERICAN EMPIRE
179
!
Neither the geographical area of the United States nor
the numerical importance of its people justifies its present
world position. The country, with 8 per cent of the area
and 6 per cent of the population of the world, looms large
in the world's economic affairs,-how large will appear from
an examination of certain features that are considered
essential to economic success, such as resources, capital,
products, shipping, and national wealth and income.
2. The Resources of the United States
The most important resource of any country is the fertile,
agricultural land. Figures given in the Department of
Agriculture Year Book for 1918 (Table 319) show the
amount of productive land, including, beside cultivated
land, natural meadows, pastures, forests, woodlots, etc., of
the various countries according to pre-war boundary lines.
The total of such productive land for the 36 leading coun-
tries of the world was 4,591.7 million acres. Russia, in-
cluding Siberia, had almost a third of this total (1,414,7
million acres). The United States came second with 878.8
million acres, or 19 per cent of the total available produc-
tive land. Third in the list was Argentine with 537.8 mil-
lion acres. British India came fourth with 465.7 million
acres. Then there followed in order Austria-Hungary,
Germany, France, Australia, Spain and Japan. Austria
Hungary, Germany and France combined had almost ex-
actly four hundred million acres of productive land or less
than half the productive area of the United States.
The United States, in the area of productive land, is
second only to Russia. In the area of land actually un-
der cultivation, however, it stands first, with Russia a
close second and British India a close third, the amounts
of cultivated land in each of these countries being 293.8
million acres, 279.6 million acres, and 264.9 million acres
respectively. These three countries together contain 64 per
cent of the 1,313.8 million acres of cultivated land of the
world. The United States alone contains 22 per cent of the
total cultivated land.
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THE AMERICAN EMPIRE
· The total forest acreage available for commercial purposes
is greatest in Russia (728.4 million acres). The United
States stands second with 400 million acres and Canada
third with 341 million acres. The Chief of Forest Investi-
gations of the United States Department of Agriculture
(Letter of Oct. 11, 1919) places the total forest acreage of
both Brazil and Canada ahead of the United States. In
the case of Brazil no figures are available showing what !
portion of the 988 million acres of total area is commer-
cially available. Canada with a total forest acreage of 800
million acres has less timber commercially available than
the United States with a total forest area of 500 million
acres.
The iron ore reserves of the world are estimated at 91,000
million tons (“Iron Ores,” Edwin C. Eckel. McGraw Hill
Book Co., 1914, pp. 392-3). Of this amount 51,000 millions
are placed in Asia and Africa; 12,000 million tons in
Europe, and 14,800 million tons in North America. The
United States alone is credited with 4,260 million tons or
about 5 per cent of the world's supply. The United States
Geological Survey (Bulletin 666v) estimates the supply of
the United States at 7,550 million tons; the supply in New-
foundland, Mexico and Cuba as 7,000 million tons, and that
in South America as 8,000 million tons as against 12,000
million tons for Europe. This estimate would give the ..
United States alone 8 per cent of the iron ore of the world.
It would give North America 15 per cent and the Western
Hemisphere 25 per cent, as against 15 per cent for Europe.
Iron ore furnishes the material out of which industrial
civilization is constructed. Until recently the source of in-
dustrial power has been coal. Even to-day petroleum and
water play a relatively unimportant rôle. Coal still holds
the field.
The United States alone contains 3,838,657 million tons-
more than half of the total coal reserves of the world.
(Coal Resources of the World.” Compiled by the Execu-
tive Committee, International Geological Congress, 1913,
Vol. I, p. XVIII ff.) North America is credited with
THE AMERICAN EMPIRE
181
5,073,431 million tons or over two-thirds of the world's total
coal reserves (7,397,553 millions of tons). The coal reserve
of Europe is 784,190 million tons or about one-fifth of the
coal reserves of the United States alone.
Figures showing the amount of productive land and of
timber may be verified. Those dealing with iron ore and
coal in the ground are mere estimates and should be treated
as such. At the same time they give a rough idea of the
economic situation. Of all the essential resources,-land,
timber, iron, copper, coal, petroleum and water-power,—the
United States has large supplies. As compared with Eu-
rope, her supply of most of them is enormous. No other
single country (the British Empire is not a single country)
that is now competing for the supremacy of the world can
compare with the United States in this regard, and if North
America be taken as the unit of discussion, its preponder-
ance is enormous.
3. The Capital of the United States
The United States apparently enjoys a large superiority
over any single country in its reserves of some of the most
essential resources. The same thing is true of productive
machinery.
Figures showing the actual quantities of capital are avail-
able in only a small number of cases. Estimates of capi-
tal value in terms of money are useless. It is only the
figures which show numbers of machines that really give
a basis for judging actual differences.
Live stock on farms, the chief form of agricultural capi-
tal, is reported for the various countries in the Year Book
of the United States Department of Agriculture. The
United States (1916) heads the list with 61.9 million cattle;
67.8 million hogs; 48.6 million sheep and goats, and 25.8
million horses and mules,—204 million farm animals in all.
The Russian Empire (including Russia in Asia) is second
(1914) with 52.0 million cattle; 15.0 hogs; 72.0 million sheep
67.8 milliates (1916) headepartment les in the Year sapi.
182
THE AMERICAN EMPIRE
and goats, and 34.9 horses and mules,—174 million farm
animals in all. British India (1914) reports more cattle
than any other country (140.5 million); she is also second
in the number of sheep and goats with 64.7 millions, but she
has no hogs and 1.9 million horses. · Argentina (1914) re-
ports 29.5 million cattle; 2.9 million sheep and goats; and
8.9 million horses and mules. The number of animals on
European farms outside of Russia is comparatively small.
Germany (1914), United Kingdom (1916), Austria-Hun-
gary (1913), and France (1916) reported 61.8 million
cattle, 46.6 million hogs, 60.8 million sheep and goats, and
11.5 million horses and mules, making a total of 180.7 mil-
lion farm animals. These four countries with a population
of about 206 million persons, had less live stock than the
United States with its population (1916) of about 100 mil-
lions.
It would be interesting to compare the amount of farm
machinery and farm equipment of the United States with
that of other countries. Unfortunately no such figures are
available.
The figures showing transportation capital are fairly
complete. (Statistical Abstr. 1918, pp. 844-5.) The total
railroad mileage of the world is 729,845. More than one-
third of this mileage (266,381 miles) is in the United States.
Russia (1916) comes second with 48,950 miles; Germany
(1914) third, with 38,600 miles and Canada (1916) fourth
with 37,437 miles.
The world's total mileage of telegraph wire (Ibid.) is
5,816,219, of which the United States has more than a fourth
(1,627,342 miles). Russia (1916) is second with 537,208
miles; Germany (1914) is third with 475,551 miles; and
France fourth with 452,192 miles.
The Bureau of Railway Economics has published a com-
pilation on “Comparative Railway Statistics" (Bulletin
100, Washington, 1916) from which it appears that the
United States is far ahead of any other country in its rail-
road equipment. The total number of locomotives in the
United States was 64,760; in Germany 29,520; in United
THE AMERICAN EMPIRE
183
e tonnasild be even more than those ut by the fig-
Kingdom 24,718; in Russia (1910) 19,984; and in France
13,828. No other country in the world had as many as ten
thousand locomotives. If these figures also showed the
locomotive tonnage as well as the number, the lead of the
United States would be even more decided as the European
locomotives are generally smaller than those used in the
United States. This fact is clearly brought out by the fig.
ures from the same bulletin showing freight car tonnage
(total carrying capacity of all cars). For the United States
the tonnage was (1913) 86,978,145. The tonnage of Ger-
many was 10.7 million; of France 5.0 millions; of Austria-
Hungary 3.8 millions. The figures for the United Kingdom
were not available.
The United States also takes the lead in postal equip-
ment. (Stat. Abstr., 1918, pp. 844-5.) There are 324,869
post offices in the world; 54,257 or one-sixth in the United
States. The postal routes of the world cover 2,513,997
miles, of which 450,954 miles are in the United States. The
total miles of mail service for the world is 2,061 millions.
Of this number the United States has 601.3 millions.
The most extreme contrast between transportation capital
in the United States and foreign countries is furnished by
the number of automobiles. Facts and Figures, the official
organ of the National Automobile Chamber of Commerce
(April, 1919) estimates the total number of cars in use
on January 1, 1917 as 4,219,246. Of this number almost
six-sevenths (3,500,000) were in use in the United States.
The total number of cars in Europe as estimated by the
Fiat Press Bureau, Italy, was 437,558, or less than one-
seventh of the number in use in the United States. Auto-
mobile distribution is of peculiar significance because the
industry has developed almost entirely since the Spanish-
American War and therefore since the time when the United
States first began to develop into a world power.
The world's cotton spindleage in 1919 is estimated at
149.4 million spindles. (Letter from T. H. Price 10/6/19.)
Of this total Great Britain has 57.0 millions; the United
States 33.7 millions; Germany 11.0 millions; Russia 8.0 mil.
lions, and France and India each 7.0 millions.
184
THE AMERICAN EMPIRE
No effort has been made to cite figures showing the esti-
mated value of various forms of capital, because of the
necessary variations in value standards. Enough material
showing actual quantities of capital has been presented to
prove that in agriculture, in transportation, in certain lines
of manufacturing the United States is either at the head of
capital (particularly automobiles) the lead of the United
States is very great.
If figures were available to show the relative amounts of
capital used in mining, in merchandising, and in financial
transactions they would probably show an equally great
advantage in favor of the United States. In this connection
it might not be irrelevant to note that in 1915 the total
stock of gold money in the world was 8,258 millions of dol-
lars. More than a quarter (2,299 millions) was in the
United States. The total stock of silver money was 2,441
was in the United States.
(Stat. Abstr., 1918, pp. 840-1.)
4. Products of the United States
Figures showing the amounts of the principal commodi-
ties produced in the United States are far more complete
than those covering the resources and capital. They are
perhaps the best index of the present economic position of
the United States in relation to the other countries of the
world.
The wheat crop of the world in 1916 was 3,701.3 million
bushels. Russia, including Siberia, was the leading pro-
ducer with 686.3 million bushels. The United States was
second with 636.7 million bushels or 17 per cent of the
world's output. British India, the third wheat producer,
had a crop in 1916 of 323.0 million bushels. Canada, with
262.8 million bushels, was fourth on the list. Thus Canada
and the United States combined produced almost exactly
one-fourth of the world's wheat crop.
THE AMERICAN EMPIRE
185
Aondon, 1914, Bales (1912000_almost efed a pro
cludinnited fourtestates. Lietatea of the Foremne sal statesanaa
As a producer of corn the United States is without a peer.
The world's corn crop in 1916 was 3,642.1 million bushels.
Two-thirds of this crop (2,566.9 million bushels) was pro-
duced in the United States.
The position of the United States as a producer of corn
is almost duplicated in the case of cotton. The Statistical
Abstract published by the British Government (No. 39,
London, 1914, p. 522) gives the world's cotton production
as 21,659,000 bales (1912). Of this number the United
States produced 14,313,000--almost exactly two-thirds.
British India, which ranks second, reported a production of
3,203,000 bales. Egypt was third with 1,471,000 bales.
About one-tenth of the world's output of wool is produced
in the United States. World production for 1917 is placed
at 2,790,000 pounds. (Bulletin, National Association of
Wool Manufacturers. 1918, p. 162.) Australia heads the
list with a production of 741.8 million pounds. Russia, in-
cluding Siberia, comes second with 380.0 million pounds.
The United States is third with 285,6 million pounds and
Argentina fourth with 258.3 million pounds.
The United States leads the world in timber production.
“Last winter we estimated that the United States has been
cutting about 50 per cent of the total world's supply of
lumber.” (Letter from Chief of Forest Investigation. · U.
S. Forest Service. Oct. 11, 1919.) The same letter gives
the present annual timber cut. The United States 12.5 bil-
lion cubic feet; Russia 7.1 billion cubic feet; Canada 3.0
billion cubic feet; Austria-Hungary 2.7 billion cubic feet.
A third of the iron ore produced in the world in 1912
came from the United States. The world's production in
that year was 154.0 million tons (British Statistical Ab.
stract, No. 39, p. 492). The United States produced 56.1
million tons or 36 per cent of the whole; Germany produced
32.7 million tons; France 19.2 million tons; the United
Kingdom 14.0 million tons. No other country is reported
as producing as much as ten million tons.
The position of the United States as a producer of iron
and steel was greatly enchanced by the war. The Daily
186
THE AMERICAN EMPIRE
An per cent of the In that yesne other throaited States ries.
Consular and Trade Reports (July 9, 1919, p. 155) give a
comparison between the world's steel and iron output in
1914 and 1918. In 1914 the United States produced 23.3
million tons of pig iron; Germany produced 14.4 million
tons; the United Kingdom 8.9 million tons, and France 5.2
million tons. The United States was thus producing 45 per
cent of the pig iron turned out in these four countries.
For 1918 the pig iron production of the United States was
39.1 million tons. That of the other three countries was
22.0 million tons. In that year the United States produced
64 per cent of the pig iron product of these four countries.
An equally great lead is shown in the case of steel produc-
tion. In 1914 the United States produced 23.5 million tons
of steel. Germany, the United Kingdom and France pro-
duced 27.6 million tons. By 1918 the production of the
United States had nearly doubled (45.1 million tons).
The total pig iron output of the world for 1917 was
placed at 66.9 millions of tons. The world's production of
steel in 1916 was placed at 83 million tons. The United
States produced considerably more than half of both com-
modities. ("The Mineral Industry During 1918.” New
York, McGraw Hill Book Co., 1919, pp. 379-80).
The two chief forms of power upon which modern indus-
try depends are petroleum and coal. The United States is
the largest producer of both of these commodities. The
world's production of petroleum in 1917 was 506.7 million
barrels (Mineral Resources, 1917, Part II, p. 867). Of this
amount the United States produced 335.3 million barrels
or 66 per cent of the total. The second largest producer,
Russia, and the third, Mexico, are credited with 69 million
barrels and 55.3 million barrels respectively.
As a coal producer the United States stands far ahead
of all other nations. The United States Geological Survey
(Special Report, No. 118) placed the total coal production
of the world in 1913 at 1,478 million tons. Of this amount
569.9 million tons (38.5 per cent) were produced in the
United States. The production for Great Britain was 321.7
million tons; for Germany 305.7 million tons; for Austria-
THE AMERICAN EMPIRE
187
Afric23.6 milliótates. The old and silver
Hungary 60.6 million tons. No other country reported a
production of as much as fifty million tons. In 1915 the
United States produced 40.5 per cent of the world's coal; in
1917 44.2 per cent; in 1918 26.2 per cent.
Copper has become one of the world's chief metals. Two-
thirds of all the copper is produced in the United States.
Copper production in 1916 totaled 3,107 million pounds
(Mineral Resources in the United States, 1916, part I,
p. 625). The production for the United States was 1,927.9
million pounds (62 per cent of the whole). The second
largest producer, Japan, turned out 179.2 million pounds.
The precious metals, gold and silver, are largely produced
in the United States. The world's gold production for 1917
was 423.6 million dollars (Mineral Resources, 1917, p. 613).
Africa produced half of this amount (214.6 million dollars).
The United States was second with a production of 83.8 mil-
lion dollars (20 per cent of the whole). The same publica-
tion (p. 615) gives the world's silver production in 1917
as 164 million ounces. 77.1 million ounces (43 per cent)
were produced in the United States. The second largest
producer was Mexico, 31.2 million ounces; and the third
Canada, with 22.3 million ounces. These three North
American countries produced 76 per cent of the world's out-
put of silver.
Judge Gary, speaking at the Annual Meeting of the Iron
and Steel Institute (1920) put the situation in this sum-
mary form :-
As frequently stated, notwithstanding the United States
has only 6% of the world's population and 7% of the
world's land, yet we produce:
20% of the world's supply of gold,
25% of the world's supply of wheat,
40% of the world's supply of iron and steel,
40% of the world's supply of lead,
40% of the world's supply of silver,
50% of the world's supply of zinc,
52% of the world's supply of coal,
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THE AMERICAN EMPIRE
60% of the world's supply of aluminum,
60% of the world's supply of copper,
60% of the world's supply of cotton,
66% of the world's supply of oil,
75% of the world's supply of corn,
85% of the world's supply of automobiles.
With the exception of rubber, practically all of the essen-
tial raw materials and food products upon which modern in-
dustrial society depends are produced largely in the United
States. With less than a sixteenth of the world's popula-
tion, the United States produced from a fifth to two-thirds
of most of the world's essential products.
6. Shipping
The rapid increase in the foreign trade of the United
States created a demand for American shipping facilities.
Before the Civil War the United States held a place as a
maritime nation. Between the Civil War and the war with
Spain the energies of the American people were devoted
to internal improvement. With the advent of expansion
that followed the Spanish-American War, came an insistent
demand that the United States develop a merchant marine
adequate to carry its own foreign trade.
The United States Commissioner of Navigation in his
report for 1917 (p. 78) gives the net gross tonnage of
steam and sailing vessels in 1914 as 45 million tons in all.
The tonnage of Great Britain was 19.8 million tons; of
Germany 4.9 million tons; of the United States 3.5 million
tons; of Norway 2.4 million tons; of France 2.2 million
tons; of Japan 1.7 million tons, and of Italy 1.6 million
tons.
The war brought about great changes in the distribution
of the world's shipping. Germany was practically elimi-
nated as a shipping nation. The necessity of recouping the
submarine losses, and of transporting troops and supplies
led the United States to adopt a ship-building program
THE AMERICAN EMPIRE
.189
that made her the second maritime country of the world.
Lloyd's Register of Shipping gives the steam tonnage of the
United Kingdom as 18,111,000 gross tons in June, 1920.
For the same month the tonnage of the United States is
given as 12,406,000 gross tons. Japan comes next with a
tonnage of 2,996,000 gross tons. According to the same
authority the United Kingdom had 41.6 per cent of the
world's tonnage in 1914 and 33.6 per cent in 1920; while the
United States had 4.7 per cent of the world's tonnage in
1914 and 24 per cent in 1920.
7. Wealth and Income
The economic advantages of the United States enumer-
ated in this chapter inevitably are reflected in the figures
of national wealth and national income. While these fig-
ures are estimates rather than conclusive statements' they
are, nevertheless, indicative of a general situation.
During the war a number of attempts were made to
ing nations. Perhaps the most ambitious of these efforts
Chief Powers" read before the Royal Statistical Society.
(See The London Economist, May 24, 1919, pp. 958-9.)
This and other estimates were compiled by L. R. Gottlieb
and printed in the Quarterly Journal of Economics for Nov.
1919. Mr. Gottlieb estimates the pre-war national wealth of
Great Britain, France, Italy, Japan, Russia, Belgium, Ger-
many, Austria-Hungary, Turkey and Bulgaria at 366,100
million dollars. At the same time the wealth of the United
States was estimated at 204,400 million dollars. Thus the
wealth of the United States was equal to about 36 per cent
of the total wealth of the great nations in question.
The same article contains an estimate of pre-war national
incomes for these great powers. The total is placed at
81,100 million dollars. The income for the United States
is placed at 35,300 million dollars, or more than 43 per cent
of the total.
THE AMERICAN EMPIRE
The war has made important changes in the wealth and
income of the principal powers. The wealth and income of
Europe have been reduced, while the wealth and income
of the United States have been greatly increased. This
increase is rendered doubly emphatic by the demoralization
in foreign exchange which gives the American dollar a posi-
tion of unique authority in the financial world.
The latest wealth estimates (Commerce and Finance,
May 26, and July 28, 1920) in terms of dollars at their
purchasing-power value, makes the wealth of the whole
British Empire 230 billions of dollars; of France, 100 bil-
lions; of Russia, 60 billions; of Italy, 40 billions; of Japan,
40 billions; of Germany, 20 billions, and of the United
States, 500 billions. These figures are subject to altera-
S
dicate the immense advantage that is possessed by the busi-
ness men of the United States over the business men of any
or of all of the other nations of the world.
Before the war, the British were the chief lenders in
the international field. In 1913 Great Britain had about
20 billions of dollars of foreign investments, as compared
with 9 billions for France and about 6 billions for Germany.
At the end of 1920, the British foreign investments had
shrunk to a fraction of their former amount, while the
United States, from the position of a debtor nation, had
become the leading investing nation of the world, with over
9 billions of dollars loaned to the Allied governments; with
notice loans estimated at over 10 billions; with foreign in-
vestments of 8 billions, and goods on consignment to the
extent of 2 billions.
The United States therefore began the year 1921 with a
greater financial lead, by several times over, than that which
she held before the war, when she was credited with a
greater wealth and a larger income than that of any other
nation in the world. The extent of the advantage enjoyed
by the United States at the end of 1920 cannot be stated
with any final accuracy, but its proportions are staggering.
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191
8. The Economic Position of the United States
.
Economically the United States is a world power. She
occupies one of the three great geographical areas in the
temperate zone. If she were to include Canada, Mexico
and Central America the territory north of the Canal
Zone-she would have the greatest unified body of economic
advantage anywhere in the world.
The United States is rich in practically all of the im-
portant industrial resources. She has a large, relatively
homogeneous population, a great part of which is directly
descended from the conquering races of the world. Al-
most all of the essential raw materials are produced in the
United States, and in relatively large quantities. The pe-
riod since the Spanish War has witnessed a rapid increase
in wealth production. The war of 1914 resulted in an even
greater increase in shipping. The investable surplus is
greater in the United States than in any other nation, and
in amount as well as in percent the national debt is less
than that in any other important nation except Japan.
Economically the position of the United States is unique.
The masters of her industries hold a position of great ad-
vantage in the capitalist world.
192
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XIV. THE PARTITION OF THE EARTH
1. Economic Power and Political Authority
ECONOMICALLY the United States is a world power. Her
world position in politics follows as a matter of course.
1 While the American people were busy with internal de-
velopment, they played an unimportant part in world af-
fairs. They were not competing for world trade, because
they had relatively little to export; they were not building
a merchant marine because of the smallness of their trad-
ing activities; they were not engaged in the scramble after
undeveloped countries because, with an undeveloped coun-
try of their own, calling continually for enlarged invest-
ments, they had little surplus capital to employ in foreign
enterprises.
This economic isolation of the United States was reflected
in an equally thoroughgoing political isolation. With the
exception of the Monroe Doctrine, which in its original
form was intended as a measure of defense against foreign
political and military aggression, the United States minded
its own affairs, and allowed the remainder of the world to
go its way. From time to time, as necessity arose, addi-
tional territory was purchased or taken from neighboring
countries--but all of these transactions, up to the annexa-
tion of Hawaii (1898) were confined to the continent of
North America, in which no European nation, with the
exception of Great Britain, had any imperative territorial
interest.
The economic changes which immediately preceded the
Spanish War period commanded for the United States a
place among the nations. The passing of economic aloof-
THE AMERICAN EMPIRE
193
ness marked the passing of political aloofness, and the
United States entered upon a new era of international
relationships. Possessed of abundant natural resources, and
having through a long period of peace developed a large
working capital with which these resources might be ex-
ploited, the United States, at the beginning of the twentieth
century, was in a position to export, to trade and to in-
vest in foreign enterprises.
The advent of the World War gave the United States
a dramatic opportunity to take a position which she must
have assumed in any case in a comparatively short time.
It had, however, one signal, diplomatic advantage,-it en-
abled the capitalist governments of Europe to accept, with
an excellent grace, the newly acquired economic prominence
of the United States and to recognize her without question
as one of the leading political powers. The loan of ten
billions to Europe; the sending of two million men at
double quick time to the battle front; the immense increases
in the production of raw material that followed the declara-
tion of war by the United States; the thoroughness dis-
played by the American people, once they had decided to
enter the war, all played their part in the winning of the
victory. There were feelings, very strongly expressed, that
the United States should have come in sooner; should have
sacrificed more and profiteered less. But once in, there
could be no question either of the spirit of her armies or
of the vast economic power behind them.
When it came to dividing the spoils of victory, the
United States held, not only the purse strings, but the
largest surpluses of food and raw materials as well. Her
diplomacy at the Peace Table was weak. Her representa-
tives, inexperienced in such matters, were no match for
the trained diplomats of Europe, but her economic posi-
tion was unquestioned, as was her right to take her place
as one of the “big five."
194
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12. Dividing the Spoils
The Peace Conference, for purposes of treaty making,
separated the nations of the world into five classes :
1. The great capitalist nations.
2. The lesser capitalist states.
3. Enemy nations.
4. Undeveloped territories.
5. The socialist states.
The great capitalist states were five in number-Great
Britain, France, Italy, Japan and the United States. These
five states dominated the armistice commission and the
Peace Conference and they were expected to dominate the
League of Nations. The position of these five powers was
clearly set forth in the regulations governing procedure at
the Peace Conference. Rule I reads: "The belligerent
powers with general interests the United States of Amer-
Learly set forth in the
Rule I readsited States of Ameri
take part in all meetings and commissions.” (New York
Times, January 20, 1919.) Under this rule the Big Five
were the Peace Conference, and throughout the subsequent
negotiations they continued to act the part.
The same concentration of authority was read into the
revised convenant of the League of Nations. Article 4 pro-
sist of the representatives of the United States of America,
of the British Empire, of France, of Italy and of Japan,
together with four other members of the League.” The
authority of the Big Five was to be maintained by giving
them five votes out of nine on the executive council of
the League, no matter how many other nations might be-
come members.
It was among the Big Five, furthermore, that the spoils
of victory were divided. The Big Five enjoyed a full meal;
the lesser capitalist states had the crumbs. V
THE AMERICAN EMPIRE
195
The enemy nations were stripped bare. Their colonies
were taken, their foreign investments were confiscated, their
merchant ships were appropriated, they were loaded down
with enormous indemnities, they were dismembered. In
short, they were rendered incapable of future economic
competition. The thoroughgoing way in which this strip-
ping was accomplished is discussed in detail by J. M.
Keynes in “The Economic Consequences of the Peace”
(chapters 4 and 5).
The undeveloped territories—the economic opportunities
upon which the Big Five were relying for the disposal of
their surplus products and surplus capital, were carved
and handed about as a butcher carves a carcass. Shantung,
which Germany had taken from China, was turned over
to Japan under circumstances which made it impossible for
China to sign the Treaty-thus leaving her territory open
for further aggression. The Near East was divided be-
tween Great Britain, France and Italy Mexico was not
invited to sign the treaty and her name was omitted from
the list of those eligible to join the League. The German
possessions in Africa and in the Pacific were distributed
in the form of “mandates” to the Great Powers. The
principle underlying this distribution was that all of the
unexploited territory should go to the capitalist victors for
exploitation. The proportions of the division had been es-
tablished, previously, in a series of secret treaties that had
been entered into during the earlier years of the war.
With the Big Five in control, with the lesser capitalist
states silenced; with the border states made or in the mak-
ing; with the enemy reduced to economic impotence, and
the unexploited portions of the world assigned for exploita-
tion, the conference was compelled to face still another
problem—the Socialist Republic of Russia.
Russia, Czar ridden and oppressed, had entered the war
as an ally of France and Great Britain. Russia, un-
shackled and attempting self-government on an economic
basis, was an “enemy of civilization.” The Allies there-
fore supported counter-revolution, organized and encour-
196
THE AMERICAN EMPIRE
aged warfare by the border states, established and main-
tained a blockade, the purpose of which was the starya-
tion of the Russian people into submission, and did all
that money, munitions, supplies, battleships and army di-
visions could do to destroy the results of the Russian Rev-
olution.
The Big Five-assuming to speak for all of the twenty-
three nations that had declared war on Germany--manipu-
lated the geography of Europe, reduced their enemies to
penury, disposed of millions of square miles of territory
and tens of millions of human beings as a gardener dis-
to the task of crushing the only thing approaching self-
government that Russia has had for centuries.
A more shameless exhibition of imperial lust is not re-
corded in history. Never before were five nations in a
position to sit down at one table and decide the political
the statesmen of the world played the old, savage game of
imperial aggression and domination.
This brutal policy of dealing with the world and its peo-
ple was accepted by the United States. Throughout the
Conference her representatives occupied a commanding
position; at any time they would have been able to speak
with a voice of almost conclusive authority; they chose,
nevertheless, to play their part in this imperial spectacle.
To be sure the Senate refused to ratify the Treaty-not
because of its imperial iniquities, but rather because there
was nothing in it for the United States.
3. Italy, France and Japan
The shares of spoil falling to Italy and France as a re-
sult of the treaty are comparatively small although both
countries and particularly France-carried a terrific war
burden. Japan, the least active of any of the leading par-
ticipants in the war, received territory of vast importance
to her future development.
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197
Italy under the secret treaty of London, signed April
26, 1915, by the representatives of Russia, France, Great
Britain and Italy,-was to receive that part of Austria
known as the Trentine, the entire southern Tyrol, the city
and suburbs of Trieste, the Istrian Islands and the province
of Dalmatia with various adjacent islands. Furthermore,
Article IX of the Treaty stipulated that, in the division of
Turkey, Italy should be entitled to an equal share in the
basin of the Mediterranean, and specifically to the province
of Adalia. Under Article XIII, “In the event of the ex-
pansion of French and English colonial domains in Africa
at the expense of Germany, France and Great Britain rec-
ognize in principle the Italian right to demand for her-
self certain compensations in the sense of expansions of
her lands in Erithria, Somaliland, in Lybia and colonial
districts lying on the boundary, with the colonies of France
and England.” Substantially, this plan was followed in
the Peace Treaty.
The territorial claims of France were simple. The se-
cret treaties include a note from the French Minister of
Foreign Affairs to the French Ambassador at Petrograd,
dated February 1-14, 1917, which stated that under the
Peace Treaty:
“(1) Alsace and Lorraine to be returned to France.
“(2) The boundaries will be extended at least to the
limits of the former principality of Lorraine, and
will be fixed under the direction of the French
Government. At the same time strategic demands
must be taken into consideration, so as to include
within the French territory the whole of the in-
dustrial iron basin of Lorraine and the whole of
the industrial coal-basin of the Saar.”
The Peace Treaty confirmed these provisions, with the
exception of the Saar Valley, which is to go to France for
15 years under conditions which will ultimately cause its
annexation to France if she desires it. France also gained
some slight territorial concessions in Africa. Her real ad-
198
THE AMERICAN EMPIRE
of the provin priviless of sec, 1917, Ambassare contin
thes the st to Tolki to the
vantage-as a result of the peace lies in the control of the
three provinces with their valuable mineral deposits.
The territorial ambitions of Japan were confined to the
Far East. The former Russian Ambassador to Tokio, un-
der date of February 8, 1917, makes the statement that
Japan was desirous of securing “the succession to all the
rights and privileges possessed by Germany in the Shan-
tung province and for the acquisition of the islands north
of the Equator.” In a secret treaty with Great Britain,
Japan secured a guarantee covering such a division of the
German holdings in the Pacific.
These concessions are of great importance to Japan. By
the terms of the Treaty one of her rivals for the trade of
the East (Germany) is eliminated, and the territory of
that rival goes to Japan. With the control of Port Arthur
and Korea and Shantung, Japan holds the gateway to the
heart of Northern China. The islands gained by Japan
as a result of the Treaty give her a barrier extending from
the Kurile Islands, near Kamchatka, through the Empire
of Japan proper, to Formosa. Farther out in the Pacific,
there are the Ladrones, the Carolines and the Pelew Is-
lands, which, in combination, make a series of submarine
bases that render attack by sea difficult or impossible, and
that lie, incidentally, between the United States and the
Philippine Islands. Japan came away from the Peace Con-
ference with the key to the East in her pocket.
4. The Lion's Share
The lion's share of the Peace Conference spoil went to
Great Britain. To each of the other participants, certain
concessions, agreed upon beforehand, were made. The re-
mainder of the war-spoil was added to the British Empire.
This "remainder" comprised at least a million and half
square miles of territory, and included some of the most
important resources in the world.
The territorial gains of Great Britain cover four areas-
the Near East, the Far East, Africa, and the South Pacific.
THE AMERICAN EMPIRE
199
the Rosion of virth, the contra in the Near
The gains of Great Britain in the Near East include
Hedjez and Yemen, the control of which gives the British
possession of virtually all of the territory bordering on
the Red Sea. The Persian Gulf is likewise placed under
British control, through her holding of Mesopotamia and
her control over Persia and Oman. The eastern end of the
Mediterranean is held by the British through their control
of Palestine.
Thus the gateway to the East,—both by land and by sea,
the eastern shores of the Mediterranean, the valleys of the
Tigris and the Euphrates and the basin of the Red Sea all
fall into the hands of the British, who now hold the heart
of the Near East. The gains of Great Britain in Africa
include Togoland, German Southwest Africa and German
East Africa. With these accessions of territory, Great
Britain holds a continuous stretch of country from the
Cape to Cairo. A British subject can therefore travel on
British soil from Cape Town via the Isthmus of Suez, to
Siam, covering a distance as the crow flies of something
like 10,000 miles.
The British gains in the South Pacific include Kaiser
Wilhelm Land and the German islands south of the
Equator.
What these territorial gains mean in the way of addi-
tional resources for the industries of the home country,
only the future can decide. Certain it is, that outside of
the Americas, Central Europe, Russia, China and Japan,
Great Britain succeeded in annexing most of the important
territory of the world.
The Chicago Tribune, in one of its charmingly frank edi-
torials, thus describes the gains to the British Empire as
a result of the war. “The British mopped up. They
opened up their highway from Cairo to the Cape. They
reached out from India and took the rich lands of the
Euphrates. They won Mesopotamia and Syria in the war.
They won Persia in diplomacy. They won the east coast
of the Red Sea. They put protecting territory about
200
THE AMERICAN EMPIRE
Egypt and gave India bulwarks. They made the eastern
dream of the Germans a British reality.
“The British never had their trade routes so guarded
as now. They never had their supremacy of the sea so
firmly established. Their naval competitor, Germany, is
gone. No navy threatens them. No empire approximates
their size, power, and influence.
"This is the golden age of the British Empire, its Au-
gustan age. Any imperialistic nation would have fought
any war at any time to obtain such results, and as im-
perialistic nations count costs, the British cost, in spite of
its great sums in men and money was small.” (January
4, 1920.)
5. Half the WorldWithout a Struggle
Two significant facts stand out in this record of spoils
distribution. One is that Great Britain received the lion's
share of them in Asia and Africa. The other, that there
Vis no mention of the Americas. Outside of the Western
Hemisphere, Great Britain is mistress. In the Americas,
with the exception of Canada, the United States is supreme.
There are two reasons for this. One is that Germany's
ambitions and possessions included Asia and Africa pri-
marily—and not America. The other is that the Peace
Conference recognized the right of the United States to
dominate the Western Hemisphere.
The representatives of the United States declared that
their country was asking for nothing from the Peace Con-
ference. Nevertheless, the insistent clamor from across the
water led the American delegation to secure the insertion
in the revised League Covenant of Article XXI which read:
"Nothing in this covenant shall be deemed to affect the
validity of international engagements, such as treaties of
arbitration or regional understandings like the Monroe
Doctrine for securing the maintenance of peace.” This
article coupled with the first portion of Article X, “The
THE AMERICAN EMPIRE
201
members of the League undertake to respect and preserve
as against external aggression the territorial integrity and
existing political independence of all members of the
League,” guarantees to the United States complete author-
ity over Latin America, reserving to her political suzerainty
and economic priority.
The half of the earth reserved to the United States under
these provisions contains some of the richest mineral de-
posits, some of the largest timber areas, and some of the
best agricultural territory in the world. Thus at the open-
ing of the new era, the United States, at the cost of a com-
paratively small outlay in men and money, has guaranteed
to her by all of the leading capitalist powers practically
an exclusive privilege for the exploitation of the Western
Hemisphere.
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XV. PAN-AMERICANISM
1. America for the Americans
In the partition of the earth, one-half was left under
the control of the United States. Among the great nations,
parties to the war and the peace, the United States alone
asked for nothing-save the acceptance by the world of
the Monroe Doctrine. The doctrine, as generally under-
stood, makes her mistress of the Western Hemisphere.
The Monroe Doctrine originated in the efforts of Latin
America to establish its independence of imperial Europe,
and the counter efforts of imperial Europe to fasten its
authority on the newly created Latin American Republics.
President Monroe, aroused by the European crusade against
popular government, wrote a message to Congress (1823)
in which he stated the position of the United States as
follows:
“The American continents, by the free and independent
condition which they have assumed and maintained, are
henceforth not to be considered as subjects for future colo-
nization by any European powers."
Monroe continues by pointing out that the United States
must view any act which aims to establish European au-
thority in the Americas as “dangerous to our peace and
safety.”
“The United States will keep her hands off Europe; she
will expect Europe to keep her hands off America,” was
the essence of the doctrine, which has been popularly ex-
pressed in the phrase "America for the Americans." The
Doctrine was thus a statement of international aloofness---
a declaration of American independence of the remainder
of the world.
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203
The Monroe Doctrine soon lost its political character.
The southern statesmen who were then guiding the destinies
of the United States were looking with longing eyes into
Texas, Mexico, Cuba and other potential slave-holding ter-
ritory. Later, the economic necessities of the northern
capitalists led them in the same direction. Professor Ro-
land G. Usher, in his “Pan-Americanism” (New York, The
Century Company, 1915, pp. 391-392) insists that the Mon-
roe Doctrine stands “First, for our incontrovertible right
of self-defense. In the second place the Monroe Doctrine
has stood for the equally undoubted right of the United
States to champion and protect its primary economic inter-
est against Europe or America.”
Through the course of a century this statement of de-
fensive policy has been converted into a doctrine of eco-
nomic pseudo-sovereignty. It is no longer a case of keep-
ing Europe out of Latin America but of getting the United
States into Latin America.
The United States does not fear political aggression by
Europe against the Western Hemisphere. On the contrary,
the aggression to-day is largely economic, and the struggle
for the markets and the investment opportunities of Latin
America is being waged by the capitalists of every great
industrial nation, including the United States.
2. Latin America
Four of the Latin American countries, viewed from the
standpoint of population and of immediately available as-
sets, rank far ahead of the remainder of Latin America.
Mexico, with a population in 1914-1915 of 15,502,000, had
an annual government revenue of $72,687,000. The popu-
lation of Brazil is 27,474,000. The annual revenue (1919)
is $183,615,000. Argentine, with a population of 8,284,000,
reported annual revenues of $159,000,000 (1918); and
Chile, with a population of 3,870,000, had an annual rev-
enue of $77,964,000 (1917). These four states rank in
political and economic importance close to Canada.
204
THE AMERICAN EMPIRE
[1918-19). The population ,000,000. Tartes combined
crited Federacar Tee bris
Great Britain holds a number of strategic positions in
the West Indies. Other nations have minor possessions in
Latin America. None of these possessions, however, is of
considerable economic or political importance. There re-
main Bolivia, Uruguay, Colombia, Ecuador, Paraguay,
Peru, Venezuela, and the Central American states. The
most populous of these countries is Peru (5,800,000 per-
sons). All of the Central American states combined have
a population of less than 6,000,000. The annual revenues
of Uruguay (population 1,407,000) are $30,453,000
(1918-19). The combined government revenues of all
Central America are less than twenty-five millions. (Sta.
tistical Abstract of the U.S., 1919, p. 826ff.)
Compared with the hundred million population of the
United States; its estimated wealth (1918) of 250 billions;
and its federal revenues of a billion and a half in 1916, the
Latin American republics cut a very small figure indeed.
The United States, bristling with economic surplus and
armed with the Monroe Doctrine, as accepted and inter-
preted in the League Covenant, is free to turn her attention
to the rich opportunities offered by the undeveloped terri.
tory stretching from the Rio Grande to Cape Horn. What
is there to hinder her movements in this direction? Noth-
ing but the limitation on her own needs and the adherence
to her own public policies. This vast area, containing ap-
proximately nine million square miles (three times the area
of continental United States), has a population of only a
little over seventy millions. The entire government rev-
enues of the territory are in the neighborhood of six hun-
dred million, but so widely scattered are the people, so
sharp are their nationalistic differences, and so completely
have they failed to build up anything like an effective
league to protect their common interests, that skillful ma-
neuvering on the part of American economic and political
interests should meet with no effectual or thoroughgoing
opposition.
The "hands off America” doctrine which the United
States has enunciated, and which Europe has accepted,
THE AMERICAN EMPIRE
1205
means first that none of the Latin American Republics is
permitted to enter into any entangling alliances without
the approval of the United States. In the second place it
means that the United States is free to treat all Latin
American countries in the same way that she has treated
Cuba, Hayti and Nicaragua during the past twenty years.
3. Economic “Latin America”
The United States is the chief producer-in the Western
Hemisphere-of the manufactured supplies needed by the
relatively undeveloped countries of Latin America. At
the same time, the undeveloped countries of Latin America
contain great supplies of ores, minerals, timber and other
raw materials that are needed by the expanding manu-
facturing interests of the United States. The United States
is a country with an investible surplus. Latin America
offers ample opportunity for the investment of that sur-
plus. Surrounding the entire territory is a Chinese wall
in the form of the Monroe Doctrine-intangible but none
the less effective.
Before the outbreak of the Great War, European capi.
talists dominated the Latin American investment market.
The five years of struggle did much to eliminate European
influence in Latin America.
The situation was reviewed at length in a publication
of the United States Department of Commerce "Invest-
ments in Latin America and the British West Indies," by
Frederick M. Halsey (Washington Government Printing
Office, 1918):
“Concerning the undeveloped wealth of various South
American countries,” writes Mr. Halsey, "it may be said
that minerals exist in all the Republics, that the forest re-
sources of all (except possibly Uruguay) are very exten-
sive, that oil deposits have been found in almost every
country and are worked commercially in Argentine, Colom-
bia, Chile, Ecuador, Peru and Venezuela, and that there
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THE AMERICAN EMPIRE
are lands available for the raising of live stock and for
agricultural purposes” (p. 20).
As to the pre-war investments, Mr. Halsey points out
that “Great Britain has long been the largest investor in
Latin America" (p. 20). The total of British invest-
ments he places at 5,250 millions of dollars. A third of
this was invested in Argentine, a fifth in Brazil and nearly
a sixth in Mexico. French investments are placed at about
one and a half billions of dollars. The German investments
were extensive, particularly in financial and trading in-
stitutions. United States investments in Latin America
investments in the mining industry and in the packing
business.
Just how much of a shift the war has occasioned in the
ownership of Latin American railways, public utilities,
mines, etc., it is impossible to say. Some such change has
occurred, however, and it is wholly in the interest of the
United States.
Generalizations which apply to Latin America have no
force in respect to Canada. The capitalism of Canada is
closely akin to the capitalism of the United States.
Canada possesses certain important resources which are
highly essential to the United States. Chief among them
are agricultural land and timber. There are two methods
by which the industrial interests of the United States
might normally proceed with relations to the Canadian re-
sources. One is to attack the situation politically, the other
is to absorb it economically. The latter method is being
pursued at the present time. To be sure there is a large
annual emigration from the United States into Canada (ap-
proximately 50,000 in 1919) but capital is migrating faster
than human beings.
The Canadian Bureau of Statistics reports (letter of May
20, 1920) on “Stocks, Bonds and other Securities held by
incorporated and joint stock Companies engaged in manu-
facturing industries in Canada, 1918," as owned by 8,130,-
THE AMERICAN EMPIRE
207

368 individual holders, distributed geographically as fol-
lows: Canada, $945,444,000; Great Britain, $153,758,000;
United States, $555,943,000, and other countries, $17,221,-
322. Thus one-third of this form of Canadian investment
is held in the United States.
4. American Protectorates
fridas. As the busineco they are state Dep
The close economic inter-relations that are developing in
the Americas, naturally have their counter-part in the po-
litical field. As the business interests reach southward for
oil, iron, sugar, and tobacco they are accompanied or fol-
lowed by the protecting arm of the State Department in
Washington. Few citizens of the United States realize
how thoroughly the conduct of the government, particularly
in the Caribbean, reflects the conduct of the bankers and
the traders.
Professor Hart in his “New American History” (Ameri-
can Book Co., 1917, p. 634) writes, “In addition the United
States between 1906 and 1916 obtained a protectorate over
the neighboring Latin American States of Cuba, Hayti,
Panama, Santo Domingo and Nicaragua. All together
these five states include 157,000 square miles and 6,000,000
people.” Professor Hart makes this statement under the
general topic, “What America Has Done for the World.”
The Monroe Doctrine, logically applied to Latin America,
can have but one possible outcome. Professor Chester
Lloyd Jones characterizes that outcome in the following
words, “Steadily, quietly, almost unconsciously the exten-
sion of international responsibility southward has become
practically a fixed policy with the State Department. It
is a policy which the record of the last sixteen years shows
is followed, not without protest from influential factions,
it is true, but none the less followed, by administrations of
both parties and decidedly different shades within one of
the parties. ... Protests will continue but the logic of
events is too strong to be overthrown by traditional argu-
208
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ment or prejudice.” (“Caribbean Interests." New York,
Appleton, 1916, p. 125.)
Latin America is in the grip of the Monroe Doctrine.
Whether the individual states wish it or not they are the
victims of a principle that has already shorn them of po-
litical sovereignty by making their foreign policy subject
to veto by the United States, and that will eventually de-
prive them of control over their own internal affairs by
placing the management of their economic activities under
the direction of business interests centering in the United
States. The protectorate which the United States will ulti-
mately establish over Latin America was forecast in the
treaty which "liberated” Cuba. The resolution declaring
war upon Spain was prefaced by a preamble which de-
manded the independence of Cuba. Presumably this inde-
pendence meant the right of self-government. Actually
the sovereignty of Cuba is annihilated by the treaty of July
1, 1904, which provides :
“Article I. The Government of Cuba shall never enter
into any treaty or compact with any foreign power or
powers which will impair or tend to impair the inde-
pendence of Cuba, nor in any matter authorize or permit
any foreign power or powers to obtain by colonization or
for military or naval purposes, or otherwise, lodgement in,
or control over any portion of said island.”
The most drastic limitations upon Cuba's sovereignty are
contained in Article 3 which reads, “the Government of
Cuba consents that the United States may exercise the
right to intervene for the preservation of Cuban independ-
ence, the maintenance of a government adequate for the
protection of life, property and individual liberty, and for
discharging the obligation with respect to Cuba imposed by
the Treaty of Paris on the United States now to be assumed
and undertaken by the Government of Cuba.” Under this
article, the United States, at her discretion, may intervene
in Cuba's internal affairs.
Under these treaty provisions the Cuban Government is
not only prevented from exercising normal governmental
charging of Paris the
THE AMERICAN EMPIRE
209
functions in international matters, but if a change of in-
ternal government should take place which in the opinion
of the United States jeopardized "life, property and in-
dividual liberty” such a government could be suppressed
by the armed forces of the United States and a government
established in conformity with her wishes. Theoretically,
Cuba is an independent nation. Practically, Cuba has
signed away in her treaty with the United States every
important attribute of sovereignty.
The fact that Cuba was a war-prize of the United States
might be advanced as an explanation of her anomalous po-
sition, were it not for the relations now existing between
the Dominican Republic, Hayti and Nicaragua on the one
hand and the United States on the other. The United
States has never been at war with any of these countries,
yet her authority over them is complete.
The Convention between the United States and the Do-
minican Republic, proclaimed July 25, 1907, gave the
United States the right to appoint a receiver of Dominican
customs in order that the financial affairs of the Republic
might be placed on a sound basis. This appointment was
followed in 1916 by the landing of the armed forces of the
United States in the territory of the Dominican Republic.
On November 29, 1916, a military government was set up
by the United States Marine Corps under a proclamation
approved by the President. “This military government at
present conducts the administration of the government'
(Letter from State Department, September 29, 1919).
The proclamation issued by the Commander of the United
States Marine Corps and approved by the President, cited
the failure of the Dominican government to live up to its
treaty obligations because of internal dissensions and stated
that the Republic is made subject to military government
and to the exercise of military law applicable to such occu-
pation. Dominican statutes "will continue in effect inso-
far as they do not conflict with the objects of the Occupa-
tion or necessary relations established thereunder, and their
lawful administration will continue in the hands of such
210
:
duly authorized Dominican officials as may be necessary,
all under the oversight and control of the United States
forces exercising Military Government." The proclama-
tion further announces that the Military Government will
collect the revenues and hold them in trust for the Republic.
Following this proclamation Captain H. S. Knapp issued
a drastic order providing for a press censorship. “Any
of the United States Government, or upon anything con-
nected with the Occupation and Military Government of
Santo Domingo must first be submitted to the local censor
for approval. In case of any violation of this rule the
publication of any newspaper or periodical will be sus-
pended; and responsible persons, owners, editors, or others
-Will further be liable to punishment by the Military Gov-
ernment. The printing and distribution of posters, hand-
bills, or similar means of propaganda in order to dissemi-
nate views unfavorable to the United States Government or
to the Military Government in Santo Domingo is forbid-
den.” (Order secured from the Navy Department and
published by The American Union against Militarism, Dec.
13, 1916.)
A similar situation exists in Hayti. The treaty of May
3, 1916, provides that “The Government of the United
States will, by its good officers, aid the Haitian Govern-
ment in the proper and efficient development of its agricul-
tural, mineral and commercial resources and in the estab-
lishment of the finances of Hayti on a firm and solid basis.”
(Article I) “The President of Hayti shall appoint upon
nomination by the President of the United States a general
receiver and such aids and employees as may be necessary
to manage the customs. The President of Hayti shall also
appoint a nominee of the President of the United States as
'financial adviser' who shall 'devise an adequate system
of public accounting, aid in increasing revenues' and take
such other steps 'as may be deemed necessary for the
welfare and prosperity of Hayti.'" (Article II.) Article
III guarantees "aid and protection of both countries to
THE AMERICAN EMPIRE
211.
the General Receiver and the Financial Adviser." Under
Article X "The Haitian Government obligates itself ...
to create without delay an efficient constabulary, urban and
rural, composed of native Haitians. This constabulary shall
be organized and officered by Americans.” The Haitian
Government under Article XI, agrees not to “surrender
any of the territory of the Republic by sale, lease or other-
wise, or jurisdiction over such territory, to any foreign gov-
ernment or power” nor to enter into any treaty or con-
tract that “will impair or tend to impair the independence
of Hayti.” Finally, to complete the subjugation of the
Republic, Article XIV provides that should the neces-
sity occur, the United States will lend an efficient aid for
the preservation of Haitian independence and the mainte-
nance of a government adequate for the protection of life,
property and individual liberty.”
A year later, on August 20, 1917, the New York Globe
carried the following advertisement:-
FORTUNE IN SUGAR
“The price of labor in practically all the cane sugar
growing countries has gone steadily up for years, except
in Hayti, where costs are lowest in the world.
"Hayti now is under U.S. Control.
“The Haitian-American corporation owns the best sugar
lands in Hayti, owns railroads, wharf, light and power-
plants, and is building sugar mills of the most modern de-
sign. There is assured income in the public utilities and
large profits in the sugar business. We recommend the
purchase of the stock of this corporation. Proceedings are
being taken to list this stock on the New York Stock Ex-
change.
"Interesting story "Sugar in Hayti’ mailed on request.
"P. W. Chapman & Co., 53 William St., N. Y. C.”
212
THE AMERICAN EMPIRE
acceptation, to perforcompelled, when it w
Barnettoriminate shocbers of shorte five by the of OCCP26
Hayti remained "under United States control" until
the revelations of the summer of 1920 (see The Nation,
July 10 and August 28, 1920), when it was shown that the
natives were being compelled, by the American forces of
occupation, to perform enforced labor on the roads and to
accept a rule so tyrannous that thousands had refused to
obey the orders of the military authorities, and had been
shot for their pains. On October 14, 1920, the New York
Times printed a statement from Brigadier General George
Barnett, formerly Commandant General of the Marine
Corps, covering the conditions in Hayti between the time
the marines landed (July, 1915) and June, 1920. General
Barnett alleges in his report that there was evidence of
"indiscriminate” killing of the natives by the American
Marines; that "shocking conditions” had been revealed in
the trial of two members of the army of occupation, and that
the enforced labor system should be abolished forthwith.
The report shows that, during the five years of the occupa-
tion, 3,250 Haytians had been killed by the Americans.
During the same period, the losses to the army of occupation
were 1 officer and 12 men killed and 2 officers and 26 men
wounded.
The attitude of the United States authorities toward the
Haytians is well illustrated by the following telegram which
the United States Acting Secretary of the Navy sent on
October 2, 1915, to Admiral Caperton, in charge of the
forces in Hayti: “Whenever the Haytians wish, you may
permit the election of a president to take place. The elec- .
tion of Dartiguenave is preferred by the United States."
The Cuban Treaty established the precedent; the Great
War provided the occasion, and while Great Britain was
clinching her hold in Persia, and Japan was strengthening
her grip on Korea, the United States was engaged in estab-
lishing protectorates over the smaller and weaker Latin-
| American peoples, who have been subjected, one after an-
other, to the omnipotence of their “Sister Republic” of
the North.
..
.
THE AMERICAN EMPIRE
213
... 5. The Appropriation of Territory,
Protectorates have been established by the United States,
where such action seemed necessary, over some of the
weaker· Latin-American states. Their customs have been
seized, their governments supplanted by military law and
the preservation of law and order” has been delegated
to the Army and Navy of the United States. The United
States has gone farther, and in Porto Rico and Panama
has appropriated particular pieces of territory.
The Porto Ricans, during the Spanish-American War,
welcomed the Americans as deliverers. The Americans,
once in possession, held the Island of Porto Rico as securely
as Great Britain holds India or Japan holds Korea. The
Porto Ricans were not consulted. They had no opportu-
nity for “self-determination.” They were spoils of war
and are held to-day as a part of the United States.
The Panama episode furnishes an even more striking
instance of the policy that the United States has adopted
toward Latin-American properties that seemed particularly
necessary to her welfare.
Efforts to build a Panama Canal had covered centuries.
When President Roosevelt took the matter in hand he found
that the Government of Colombia was not inclined to grant
the United States sovereignty over any portion of its terri-
tory. The treaty signed in 1846 and ratified in 1848 placed
the good faith of the United States behind the guarantee
that Colombia should enjoy her sovereign rights over the
Isthmus. During November 1902 the United States ejected
the representatives of Colombia from what is now the
Panama Canal Zone and recognized a revolutionary gov-
ernment which immediately made the concessions necessary
to enable the United States to begin its work of construct-
ing the canal.
The issue is made clear by a statement of Mr. Roosevelt
frequently reiterated by him (see The Outlook, October 7,
1911) and appearing in the Washington Post of March 24,
214
THE AMERICAN EMPIRE
.
1911, as follows:-"I am interested in the Panama Canal
because I started it. If I had followed the traditional con-
servative methods I would have submitted a dignified state
paper of probably two hundred pages to the Congress and
the debate would have been going on yet. But I took the
Canal Zone and let the Congress debate, and while the
debate goes on, the Canal does also.”
Article 35 of the Treaty of 1846 between the United
States and Colombia (then New Grenada) reads as follows,
--"The United States guarantees, positively and efficaci-
ously to New Grenada, by the present stipulation, the per-
fect neutrality of the before mentioned Isthmus . .. and
the rights of sovereignty which New Grenada has and
possesses over said territory.”
In 1869 another treaty was negotiated between the United
States and Colombia which provided for the building of a
ship canal across the Isthmus. This treaty was signed by
the presidents of both republics and ratified by the Colom-
bian Congress. The United States Senate refused its assent
to the treaty. Another treaty negotiated early in 1902 was
ratified by the United States Senate but rejected by the
Colombian Congress. The Congress of the United States
had passed an act (June 28, 1902) "To provide for the
construction of a canal connecting the waters of the Atlan-
tic and the Pacific Oceans." Under this act the President
was authorized to negotiate for the building of the canal
across the Isthmus of Panama. If that proved impossible
within a reasonable time, the President was to turn to the
Nicaragua route. The treaty prepared in accordance with
this act provided that the United States would pay Colom-
bia ten millions of dollars in exchange for the sovereignty
over the Canal Zone. The Colombian Congress after a
lengthy debate rejected the treaty and adjourned on the
last day of October, 1902.
Rumor had been general that if the treaty was not ratified
by the Colombian Government, the State of Panama would
secede from Colombia, sign the treaty, and thus secure the
ten millions. In consequence of these rumors, which
THE AMERICAN EMPIRE
215
threatened transportation across the Isthmus, American
war vessels were dispatched to Panama and to Colon.
On November 3, 1902, the Republic of Panama was estab-
lished. On November 13 it was recognized by the United
States. Immediately thereafter a treaty was prepared and
ratified by both governments and the ten millions were paid
to the Government of Panama.
: Early in the day of November 3, the Department of
State was informed that an uprising had occurred. Mr.
Loomis wired, “Uprising on Isthmus reported. Keep De-
partment promptly and fully informed.” In reply to this
the American consul replied, “The uprising has not oc-
curred yet; it is announced that it will take place this
evening. The situation is critical.” Later the same official
advised the Department that in the words of the Presi.
dential message, 1904) “the uprising had occurred and had
been successful with no bloodshed.”
The Colombian Government had sent troops to put down
the insurrection but the Commander of the United States
forces, acting under instructions sent from Washington on
November 2, prevented the transportation of the troops.
His instructions were as follows,-"Maintain free and un-
interrupted transit if interruption is threatened by armed
force with hostile intent, either governmental or insurgent,
at any point within fifty miles of Panama. Government
forces reported approaching the Isthmus in vessels. Pre-
vent their landing, if, in your judgment, the landing
would precipitate a conflict.”
Thus a revolution was consummated under the watchful
eye of the United States forces; the home government at
Bogota was prevented from taking any steps to secure the
return of the seceding state of Panama to her lawful sover-
eignty, and within ten days of the revolution, the new
Republic was recognized by the United States Government.1
1 For further details see "The Panama Canal” Papers presented to
the Senate by Mr. Lodge, Senate Document 471, 63rd Congress, 2nd
Session,
216
THE AMERICAN EMPIRE
(Ten days was the length of time necessary to transmit
a letter from Panama to Washington. Greater speed would
have been impossible unless the new state had been recog-
nized by telegraph.)
6. The Logical Exploiters
of the Westermorld. They e Mexico, th, the sugar he way
The people of the United States are the logical exploiters
of the Western Hemisphere--the children of destiny for
one half the world. They are pressed by economic neces-
sity. They need the oil of Mexico, the coffee of Brazil,
the beef of Argentine, the iron of Chile, the sugar of Cuba,
the tobacco of Porto Rico, the hemp of Yucatan, the wheat
and timber of Canada. In exchange for these commodities
the United States is prepared to ship manufactured prod-
ucts. Furthermore, the masters of the United States have
an immense and growing surplus that must be invested in
some paying field, such as that provided by the mines,
agricultural projects, timber, oil deposits, railroad and
other industrial activities of Latin-America.
The rulers of the United States are the victims of an
econòmic necessity that compels them to seek and to find
raw materials, markets and investment opportunities. They
are also the possessors of sufficient economic, financial, mili-
tary and naval power to make these needs good at their
discretion.
The rapidly increasing funds of United States capital
invested in Latin-America and Canada, will demand more
and more protection. There is but one way for the United
States to afford that protection—that is to see that these
countries preserve law and order, respect property, and
follow the wishes of United States diplomacy. Wherever
a government fails in this respect, it will be necessary
for the State Department in coöperation with the Navy, to
see that a government is established that will 'make good.”
Under the Monroe Doctrine, as it has long been inter-
preted, no Latin-American Government will be permitted
THE AMERICAN EMPIRE
217
to enter into entangling alliances with Europe or Asia.
Under the Monroe Doctrine, as it is now being interpreted,
no Latin-American people will be permitted to organize a
revolutionary government that abolishes the right of private
interests to own the oil, coal, timber and other resources.
The mere threat of such action by the Carranza Govern-
ment was enough to show what the policy of the United
States must be in such an emergency.
The United States need not dominate politically her
weaker sister republics. It is not necessary for her to in-
terfere with their "independence.” So long as their re-
sources may be exploited by American capitalists; so long
as the investments are reasonably safe; so long as markets
are open, and so long as the other necessities of United
States capitalism are fulfilled, the smaller states of the
Western Hemisphere will be left free to pursue their va-
rious ways in prosperity and peace.
218
THE AMERICAN EMPIRE
XVI. THE AMERICAN CAPITALISTS AND WORLD
EMPIRE
1. The Plutocrats Must Carry on
oulder the ne to rule.ey are to obiety must" their
THE American plutocrats—those who by force of their
wealth share in the direction of public policy-must carry
on. They have no choice. If they are to continue as pluto-
crats, they must continue to rule. If they continue to rule,
they must shoulder the duties of rulership. They may not
relish the responsibility which their economic position has
thrust upon them any more than the sojourners in New-
foundland relish the savage winters. Nevertheless, those
who own the wealth of a capitalist nation must accept the
results of that ownership just as those who remain in New-
foundland must accept the winter storms.
The owners of American timber, mines, factories, rail-
roads, banks and newspapers may dislike the connotations
of imperialism; may believe firmly in the principles of com-
petition and individualism; may yearn for the nineteenth
century isolation which was so intimate a feature of Amer-
ican economic life. But their longings are in vain. The
old world has passed forever; the sun has risen on a new
day-a day of world contacts for the United States.
Henry Cabot Lodge of Massachusetts stated the matter
with rare accuracy in a speech which he made during the
discussion over the conquest of the Philippines. After ex-
plaining that wars come, “never ostensibly, but actually
from economic causes,” Senator Lodge said (Congressional
Record, 56th Congress, 2nd Session, p. 637. January 7,
1901):
"We occupy a great position economically. We are
marching on to a still greater one. You may impede it,
THE AMERICAN EMPIRE
219
you may check it, but you cannot stop the work of eco-
nomic forces. You cannot stop the advance of the United
which underlie all are carrying us forward to the economic
supremacy of the world.”
Senator Lodge spoke the economic truth in 1901. Wil. ;
liam C. Redfield reënforced it in an address before the
American Manufacturers Export Association (Weekly Bul-
Çetin, April 26, 1920, p. 7): “We cannot be foreign mer-
chants very much longer in this country excepting on a
diminishing and diminishing scale-we have got to become
foreign constructors; we have got to build with American
money-foreign enterprises, railroads, utilities, factories,
mills, I know not what, in order that by large ownership
in them we may command the trade that normally flows
from their operation.” That is sound capitalist doctrine.
Equally sound is the exhortation that follows: "In so do-
ing we shall be doing nothing new-only new for us. That
is the way in which Germany and Great Britain have built
up their foreign trade.”
New it is for America—but it is the course of empire,
familiar to every statesman. The lesson which Bismarck,
Palmerston and Gray learned in the last century is now
being taught by economic pressure to the ruling class of
the United States.
The elder generation of American business men was not
trained for world domination. To them the lesson comes
hard. The business men of the younger generation are
picking it up, however, with a quickness born of paramount
necessity.
2. Training Imperialists
Every great imperial structure has had simple begin-
nings. Each imperial ruling class has doubtless felt mis-
givings, during the early years of its authority. Hesitat-
ing, uncertain, they have cast glances over their shoulders
220
THE AMERICAN EMPIRE
towards that which was, but even while they were looking
backward the forces that had made them rulers were thrust-
ing them still farther forward along the path of imperial
power. Then as generation succeeded generation, the rul-
ers learned their lesson, buildinę, a tradition of rulership
and authority that was handed down from father to son;
acquiring a vision of world organization and world power
that gave them confidence to go forward to their own un-
doing. The masters of public life in Rome were such peo-
ple; the present masters of British economic and political
affairs are such people.
American imperialists still are in the making. Until
1900 their eyes were set almost exclusively upon empire
within the United States. Those who, before 1860, dreamed
of a slave power surrounding the Gulf of Mexico, wero
thrust down and their places taken by builders of railroads
and organizers of trusts. To-day the sons and grandsons
of that generation of exploiters who confined their attention
to continental territory, are compelled, by virtue of the or-
ganization which their sires and grandsires established, to
seek Empire outside the boundaries of North America.
During the years when the leaders of American business
life were spending the major part of their time in "getting
rich,” the sweep of social and economic forces was driving
the United States toward its present imperial position.
Now the position has been attained, those in authority have
no choice but to accept the responsibilities which accom-
pany it.
Economically the United States is a world power. The
war and the subsequent developments have forced the coun-
try suddenly into a position of leadership among the capi-
talist nations. The law of capitalism is: Struggle to dis-
pose of your surplus, otherwise you cannot survive. This
law has laid its heavy hand upon Great Britain, upon
France, upon Germany, and now it has struck with full
force into the isolated, provincial life of the United States.
It is the law-immutable as the system of gravitation.
THE AMERICAN EMPIRE
221
.
While the present system of economic life exists, this law
will continue to operate. Therefore the masters of Ameri-
can life have no alternative. If they would survive, they
must dispose of their surplus.
Politically the United States is recognized as one of the
leaders of the world. Despite its tradition of isolation,
despite the unwillingness of its statesmen to enter new
paths, despite the indifference of its people to international
affairs, the resources and raw materials required by the
industrial nations of Europe, the rapidly growing surplus
and the newly acquired foreign markets and investments
make the United States an integral part of the life of the
world.
The ruling class in the United States has no more choice
than the rulers of a growing city whose boundaries are ex-
tending with each increment of population. If it is to con.
tinue as a ruling class, it must accept conditions as they are.
The first of these conditions is that the United States is a
world power neither because of its virtue nor because of its
intelligence in the delicacies of the world politics, but be-
cause of the sheer might of its economic organization.
Economic necessity has forced the United States into the
front rank among the nations of the world. Economic
necessity is forcing the ruling class of the United States to
occupy the position of world leadership, to strengthen it,
to consolidate it, and to extend it at every opportunity.
The forces that played beside the yellow Tiber and the
sluggish Nile are very much the same as those which led
Napoleon across the wheat fields of Europe and that are
to-day operating in Paris, London, and in New York. The
forces that pushed the Roman Empire into its position of
authority and led to the organization of Imperial Britain
are to-day operating with accelerated pace in the United
States. The sooner the American people, and particularly
those who are directing public policy, wake up to this sim-
ple but essential fact, the sooner will doubt and misunder-
standing be removed, the sooner will the issues be drawn
and the nation's course be charted.
222
THE AMERICAN EMPIRE
3. The Logical Goal
The logical goal of the American plutocracy is the eco-
nomic and incidentally the political control of the world.
The rulers of Macedon and Assyria, Rome and Carthage,
of Britain and France labored for similar reasons to reach
this same goal. It is economic fate. Kings and generals
were its playthings, obeying and following the call of its
destiny.
The rulers of antiquity were limited by a lack of trans-
portation facilities; their “world” was small, including
the basin of the Mediterranean and the land surrounding the
Persian Gulf and the Indian Ocean, nevertheless, they set
out, one after another, to conquer it. To-day the rapid ac-
cumulation of surplus and the speed and ease of communi-
cation, the spread of world knowledge and the larger
means of organization make it even more necessary than it
was of old for the rulers of an empire to find a larger and
ever larger place in the sun. The forces are more pressing
than ever before. The times call more loudly for a genius
with imagination, foresight and courage who will use the
power at his disposal to write into political history the
gains that have already been made a part of economic life.
Let such a one arise in the United States, in the present
chaos of public thought, and he could not only himself dic-
tate American public policy for the remainder of his life,
but in addition, he could, within a decade, have the whole
territory from the Canadian border to the Panama Canal
under the American Flag, either as conquered or subject
territory; he could establish a Chinese wall around South
American trade and opportunities by a very slight exten-
sion of the Monroe Doctrine; he could have in hand the
problem of an economic if not a political union with Can-
ada, and could be prepared to measure swords with the
nearest economic rival, either on the high seas or in any
portion of the world where it might prove necessary to
join battle.
THE AMERICAN EMPIRE
223
Such a program would be a departure from the tradi-
a nation of farmers, have already lost their significance.
They are historic, with no contemporary justification. The
economic life that has grown up since 1870 of necessity
will create new public policies.
The success of such a program would depend upon four
things:
1. A coördination of American economic life.
2. A fast grip on the agencies for shaping public opin-
ion.
3. A body of citizens, martial, confident, restless, am-
bitious.
4. A ruling class with sufficient imagination to paint, in
warm sympathetic colors, the advantages of world domin-
ion; and with sufficient courage to follow out imperial pol-
icy, regardless of ethical niceties, to its logical goal of world
conquest.
All four of these requisites exist in the United States
to-day, awaiting the master hand that shall unite them.
Many of the leaders of American public life know this.
Some shrink from the issue, because they are unaccustomed
to dream great dreams, and are terrified by the immensity
of large thoughts. Others lack the courage to face the
new issues. Still others are steadily maneuvering them-
selves into a position where they may take advantage of a
crisis to establish their authority and work their imperial
will. The situation grows daily more inviting; the oppor-
tunity daily more alluring. The war-horse, saddled and
bridled, is pawing the earth and neighing. How soon will
the rider come?
4. Eat or Be Eaten
The American ruling class has been thrown into a posi-
tion of authority under a system of international economic
competition that calls for initiative and courage. Under
this system, there are two possibilities,-eat or be eaten!
224
THE AMERICAN EMPIRE
There is no middle ground, no half way measure. It is
impossible to stop or to turn back. Like men engaged on
a field of battle, the contestants in this international eco-
nomic struggle must remain with their faces toward the
enemy, fighting for every inch that they gain, and holding
these gains with their bodies and their blood, or else they
must turn their backs, throw away their weapons, run for
their lives, and then, hiding on the neighboring hills, watch
while the enemy despoils the camp, and then applies a
torch to the ruins.
The events of the great war prove, beyond peradventure,
that in the wolf struggle among the capitalist nations, no
rules are respected and no quarter given. Again and again
the leaders among the allied statesmen-particularly Mr.
Lloyd George and Mr. Wilson-appealed to the German
people over the heads of their masters with assurances that
the war was being fought against German autocracy, not
against Germans. "When will the German people throw
off their yoke?” asked one Allied diplomat. The answer
came in November, 1918. A revolution was contrived, the
Kaiser fled the country, the autocracy was overthrown.
Germans ceased to fight with the understanding that Mr.
Wilson's Fourteen Points should be made the foundation of
the Peace. The armistice terms violated the spirit if not
the letter of the fourteen points; the Peace Treaty scattered
them to the winds. Under its provisions Germany was
stripped of her colonies; her investments in the allied pos-
sessions were confiscated; her ships were taken; three-
quarters of her iron ore and a third of her coal supply
were turned over to other powers; motor trucks, locomo-
tives, and other essential parts of her economic mechanism
were appropriated. Austria suffered an even worse fate,
being “drawn and quartered” in the fullest sense of the
term. After stripping the defeated enemies of all avail-
able booty, levying an indeterminate indemnity, and dis-
membering the German and Austrian Empires, the Allies
established for thirty years a Reparation Commission, which
is virtually the economic dictator of Europe. Thus for a
generation to come, the economic life of the vanquished
UN
THE AMERICAN EMPIRE
225
Empires will be under the active supervision and con-
trol of the victors. Never did a farmer's wife plucka
goose barer than the Allies plucked the Central Powers.
(See the Treaty, also “The Economic Consequences of the
Peace," J. M. Keynes. New York, Harcourt, Brace &
Howe, 1920.)
Under the armistice terms and the Peace Treaty the Al-
lies did to Germany and Austria exactly what Germany
and Austria would have done to France and Great Britain
had the war turned out differently. The Allied statesmen
talked much about democracy, but when their turn came
they plundered and despoiled with, a practiced imperial
hand. France and Britain, as well as Germany and Aus-
tria, were capitalist Empires. The Peace embodies the
essential economic morality of capitalist imperialism, the
morality of “Eat or be eaten.'
5. The Capitalists and War
people anis internatied with cont face to face Thes
The people and even the masters of America are inex-
perienced in this international struggle. Among them-
selves they have experimented with competitive industrial-
ism on a national scale. Now, brought face to face with
the world struggle, many of them revolt against it. They
deplore the necessities that lead nations to make war on
one another. They supported the late war "to end war."
They gave, suffered and sacrificed with a keen, idealistic
desire to make the world safe for democracy.” They
might as well have sought to scatter light and sunshine
from a cloudbank.
The masters of Europe, who have learned their trade
in long years of intrigue, diplomacy and war, feel no such
repugnance. They play the game. The American people
are of the same race-stocks as the leading contestants in the
European struggle. They are not a whit less ingenious,
not a whit less courageous, not a whit less determined.
When practice has made them perfect they too will play
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the game just as well as their European cousins and their
play will count for more because of the vast economic re-
sources and surpluses which they possess.
American statesmen in the field of international diplo-
macy are like babies, taking their first few steps. Later
the steps come easier and easier, until a child, who but
a few months ago could not walk, has learned to romp and
sport about. The masters of the United States are un-
trained in the arts of international intrigue. They showed
their inferiority in the most painful way during the nego-
tiations over the Paris Treaty. They are as yet inschooled
in international trade, banking and finance. They are also
inexperienced in war, yet, having only raw troops, and
little or no equipment, within two years they made a no-
table showing on the battlefields of Europe. Now they are
busy learning their financial lessons with an equal facility.
A generation of contact with world politics will bring to the
fore diplomats capable of meeting Europe's best on their
own ground. What Europe has learned, America can
learn; what Europe has practiced, America can practice,
and in the end she may excel her teachers.
To-day economic forces are driving relentlessly. Surplus
is accumulating in a geometric ratio-surplus piling on sur-
plus. This surplus must be disposed of. While the re-
mainder of the world—except Japan--is staggering under
intolerable burdens of debt and disorganization, the United
States emerges almost unscathed from the war, and pre-
pares in dead earnest to enter the international struggle,
to play at the master game of “eat or be eaten.”
Pride, ambition and love of gain and of power are pull-
ing the American plutocrats forward. The world seems
to be within their grasp. If they will reach out their
hands they may possess it! They have assumed a great
responsibility. As good Americans worthy of the tradition
of their ancestors, they must see this thing through to the
end! They must win, or die in the attempt; and it is in
this spirit that they are going forward.
The American capitalists do not want war with Great
intoleren of the world Lust be disposedurplus pili
THE AMERICAN EMPIRE
227
Britain or with any other country. They are not seeking
war. They will regret war when it comes.
War is expensive, troublesome and dangerous. The ex-
periences of Europe in the War of 1914 have taught some
America have visited Europe. They have seen the old in-
stitutions destroyed, the old customs uprooted, the old
faiths overturned. They have seen the economic order in
which they were vitally concerned hurled to the earth and
shattered. They have seen the red flag of revolution wave
where they had expected nothing but the banner of victory.
They have seen whole populations, weary of the old order,
throw it aside with an impatient gesture and bring a new
order into being. They have good reasons to understand
and fear the disturbing influences of war. They have felt
them even in the United States-three thousand miles away
from the European conflict. How much more pressing
might this unrest be if the United States had fought all
through the war, instead of coming in when it was prac-
tically at an end !
such a loss would mean for the United States what it has
meant for Germany-economic slavery.
Presented with an opportunity to choose between the
hazards of war and the certainties of peace most of the
capitalist interests in the United States would without
question choose peace. There are exceptions. The manu-
facturers of munitions and of some of the implements and
supplies that are needed only for war purposes, un-
doubtedly have more to gain through war than through
peace, but they are only a small element in a capitalist
world which has more to gain through peace than through
war.
But the capitalists cannot choose. They are embedded
in an economic system which has driven them-whether
they liked it or not-along a path of imperialism. Once
having entered upon this path, they are compelled to fol.
low it into the sodden mire of international strife,
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THE AMERICAN EMPIRE
6. The Imperial Task
The American ruling class—the plutocracy-must plan
to dominate the earth; to exploit it, to exact tribute from
it. Rome did as much for the basin of the Mediterranean.
Great Britain has done it for Africa and Australia, for
half of Asia, for four million square miles in North Amer-
ica. If the people of one small island, poorly equipped with
resources, can achieve such a result, what may not the peo-
ple of the United States hope to accomplish ?
That is the imperial task.
1. American economic life must be unified. Already
much of this work has been done.
2. The agencies for shaping public opinion must be se-
cured. Little has been left for accomplishment in
this direction.
3. A martial, confident, restless, ambitious spirit must
be generated among the people. Such a result is be-
ing achieved by the combination of economic and so-
cial forces that inhere in the present social system.
4. The ruling class must be schooled in the art of ruler-
ship. The next two generations will accomplish that
result.
The American plutocracy must carry on. It must con-
solidate its gains and move forward to greater achieve-
ments, with the goal clearly in mind and the necessities of
imperial power thoroughly mastered and understood.
THE AMERICAN EMPIRE
229
XVIL. THE NEW IMPERIAL ALIGNMENT
1. A Survey of the Evidence
THROUGH the centuries empires have come and gone. In
each age some nation or people has emerged-stronger,
better organized, more aggressive, more powerful than its
neighbors and has conquered territory, subjugated popu.
lations, and through its ruling class has exploited the work-
ers at home and abroad.
Europe has been for a thousand years the center of the
imperial struggle, the struggle which called into being
the militarism so hated by the European peoples. It was
from that struggle that millions fled to America, where
they hoped for liberty and peace.
The eighteenth century witnessed the rise of Great
Britain to a position of world authority. During the nine-
teenth century she held her place against all rivals. With
the assistance of Prussia, she overthrew Napoleon at Water-
loo. In the Crimean War and the Russo-Japanese War
she halted the power of the Czar. Half a century after
Waterloo Germany, under the leadership of Prussia won
the Franco-Prussian War, and by that act became the lead-
ing rival of the British Empire. Following the war, which
gave Germany control of the important resources included
in Alsace and Lorraine, there was a steady increase in her
industrial efficiency; the success of her trade was as pro-
nounced as the success of her industries, and by 1913 the
Germans had a merchant fleet and a navy second only to
those of Great Britain.
Germany's economic successes, and her threat to build a
railroad from Berlin to Bagdad and tap the riches of the
East, led the British to form alliances with their traditional
enemies the French and the Russians. Russia, after the
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THE AMERICAN EMPIRE
breakdown of Czarism in 1917, dropped out of the Entente,
and the United States took her place among the Allies of
the British Empire. During the struggle France was re-
duced to a mere shell of her former power. The War of
1914 bled her white, loaded her with debt, disorganized her
industries, demoralized her finances, and although it re-
stored to her important mineral resources, it left her too
weak and broken to take real advantage of them.
The War of 1914 decided the right of Great Britain to
rule the Near East as well as Southern Asia and the strategic
points of Africa. In the stripping of the vanquished and
in the division of the spoils of war the British lion proved
to be the lion indeed. But the same forces that gave the
British the run of the Old World called into existence a rival
in the New.
People from Britain, Germany and the other countries of
Northern Europe, speaking the English language and fired
with the conquering spirit of the motherland, had been, for
three centuries, taming the wilderness of North America.
They had found the task immense, but the rewards equally
great. When the forces of nature were once brought into
subjection, and the wilderness was inventoried, it proved to
contain exactly those stores that are needed for the success
of modern civilization. With the Indians brushed aside,
and the Southwest conquered from Mexico, the new ruling
class of successful business men established itself, and the
matter of safeguarding property rights, of building indus-
trial empires and of laying up vast stores of capital and
surplus followed as a matter of course.
Europe, busy with her own affairs, paid little heed to the
New World, except to send to it some of her most rugged
stock and much of her surplus wealth. The New World,
left to itself, pursued its way-in isolation, and with an in.
tensity proportioned to the size of the task in hand and the
richness of the reward.
The Spanish War in 1898 and the performance of the
Canadians in the Boer War of 1899 astounded the world,
THE AMERICAN EMPIRE
231
but it was the War of 1914 that really waked the Europeans
to the possibilities of the Western peoples. The Canadians
proved their worth to the British armies. The Americans
showed that they could produce prodigious amounts of the
necessaries of war, and when they did go in, they inaugu-
rated a shipping program, raised and dispatched troops,
furnished supplies and provided funds to an extent which,
up to that time, was considered impossible. The years from
1914 to 1918 established the fact that there was, in the
West, a colossus of economic power.
2. The New International Line-Up
line-up. The first is Russia; the second is the Japanese
the American Empire. Italy has neither the resources, the
wealth nor the population necessary to make her a factor
of large importance in the near future. France is too weak
economically, too overloaded with debt and too depleted in
population to play a leading rôle in world affairs.
The Russian menace is immediate. Bolshevism is not
only the antithesis of Capitalism but its mortal enemy. If
Bolshevism persists and spreads through Central Europe,
India and China, capitalism will be wiped from the earth.
A federation of Russia, the Baltic states, the new border
provinces, and the Central Empires on a socialist basis
would give the socialist states of central and northern Eu-
rope most of the European food area, a large portion of the
European raw material area and all of the technical skill
and machinery necessary to make a self-supporting eco-
nomic unit. The two hundred and fifty millions of people
in Russia and Germany combined in such a socialist federa-
tion would be as irresistible economically as they would be
from a military point of view.
Such a Central European federation, developing as it
must along the logical lines that lead into India and China
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THE AMERICAN EMPIRE
would be the strongest single unit in the world, viewed
from the standpoint of resources, of population, of produc-
tive power or of military strength. The only possible
rivals to such a combination would be the widely scattered
forces of the British Empire and the United States, sepa-
rated from it by the stretches of the Atlantic Ocean.
Against such a grouping Japan would be powerless be-
cause it would deprive her of the source of raw materials
upon which she must rely for her economic development.
Great Britain with her relatively small population and her
rapidly diminishing resources could make no head against
such a combination even with the assistance of her colonial
empire. Northern India is as logical a home for Bolshe-
vism as Central China or South-eastern Russia. Connect
India and China with bonds that make effective coöperation
possible and these countries-containing nearly two-thirds
of the population of the world, and possessed of the re-
sources necessary to maintain a modern civilization--could
laugh at outside interference.
Two primary difficulties confront the organizers of the
Federated Socialist Republics of Europe and Asia. One
is nationality, language, custom and tradition, together
with the ancient antagonisms which have been so carefully
nurtured through the centuries. The other is the fright-
ful economic disorganization prevalent throughout Central
Europe, –a disorganization which would be increased
rather than diminished by the establishment of new forms
of economic life. Even if such an organization were per-
fected, it must remain, for a long time to come, on a de-
fensive basis.
1
The "yellow peril” thus far is little more than the
Japanese menace to British and American trade in the Far
East. The Japanese Archipelago is woefully deficient in
coal, iron, petroleum, water power and agricultural land.
The country is over-populated and must depend for its
THE AMERICAN EMPIRE
233
supplies of food and raw materials upon continental Asia.
There seems to be no probability that Japan and China
can make any effective working agreement in the near
future that will constitute an active menace to the su-
premacy of the white race. Alone Japan is too weak in
resources and too sparse in population. Combined with
China she would be formidable, but her military policy in
Korea and in the Shantung Province have made any effec-
tive coöperation with China at least temporarily impossible.
Furthermore, the Japanese are not seeking world con-
quest. On the contrary, they are bent upon maintaining
their traditional aloofness by having a Monroe Doctrine
for the East. This doctrine will be summed up in the
phrase, “The East for the Easterners,'—the easterners be-
ing the Japanese. Such a policy would prove a serious
menace to the trade of the United States and of Great
Britain. It would prove still more of a hindrance to the
investment of American and British capital in the very
promising Eastern enterprises, and would close the door on
the Western efforts to develop the immense industrial re-
sources of China. The recent “Chinese Consortium,” in
which Japan joined with great reluctance, suggests that the
major capitalist powers have refused to recognize the ex-
clusive right of Japan to the economic advantages of the
Far East. How seriously this situation will be taken by
the United States and Great Britain depends in part upon
the vigor with which Japan prosecutes her claims and
in part upon the preoccupation of these two great powers
with Bolshevism in Europe and with their own competitive
activities in ship building, trade, finance and armament.
4. The British and the American Empires
The two remaining major forces in world economics and
politics are the British Empire and the American Empire,
-the mistress of the world, and her latest rival in the
competition for world power. Between them, to-day, most
of the world is divided. The British Empire includes the
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THE AMERICAN EMPIRE
nited States mozas she goes to the Germany,
Near East, Southern Asia, Africa, Australia and half of
North America. Dogging her are Germany, France,
Russia and Italy, and, as she goes to the Far East,Japan.
The United States holds the Western Hemisphere, where
she is supreme, with no enemy worthy the name.
The British power was shaken by the War of 1914.
Never, in modern times, had the British themselves, been
compelled to do so much of the actual fighting. The war
debt and the disorganization of trade incident to the war
period proved serious factors in the curtailment of British
economic supremacy. At the same time, the territorial
gains of the British were enormous, particularly in the
Near East.
The Americans secured real advantages from the war.
They grew immensely rich in profiteering during the first
three years, they emerged with a relatively small debt,
with no great loss of life, and with the greatest economic
surpluses and the greatest immediate economic advantages
possessed by any nation of the world.
The British Empire was the acknowledged mistress of
the world in 1913. Her nearest rival (Germany) had one
battleship to her two; one ton of merchant shipping to her
three, and two dollars of foreign investments to her five.
This rivalry was punished as the successive rivals of the
British Empire have been punished for three hundred
years.
The war was won by the British Empire and her Allies,
but in the hour of victory a new rival appeared. By 1920
that rival had a naval program which promised a fleet
larger than the British fleet in 1924 or 1925; within three
years she had increased her merchant tonnage to two-thirds
of the British tonnage, and her foreign investments were
three times the foreign investments of Great Britain. This
new rival was the American Empire-whose immense eco-
nomic strength constituted an immediate threat to the
world power of Great Britain,
THE AMERICAN EMPIRE
235
, 5. The Next Incident in the Great War
Some nation, or some group of nations has always been
in control of the known world or else in active competi-
tion for the right to exercise such a control. The present
is an era of competition.
Capitalism has revolutionized the world's economic life.
By 1875 the capitalist nations were in a mad race to de-
termine which one should dominate the capitalist world and
have first choice among the undeveloped portions of the
earth. The competitors were Great Britain, Germany,
France, Russia and Italy Japan and the United States
did not really enter the field for another generation.
The War of 1914 decided this much :that France and
Italy were too weak to play the big game in a big way,
that Germany could not compete effectively for some time
to come; that the Russians would no longer play the old
game at all. There remained Japan, Great Britain and
the United States and it is among these three nations that
the capitalist world is now divided. Japan is in control
of the Far East. Great Britain holds the Near East,
Africa and Australia; the United States dominates the
Western Hemisphere.
The Great War began in 1914. It will end when the
question is decided as to which of these three empires will
control the Earth.
Great Britain has been the dominant factor in the world
for a century. She gained her position after a terrific
struggle, and she has maintained it by vanquishing Hol-
land, Spain, France and Germany.
The United States is out to capture the economic su-
premacy of the earth. Her business men say so frankly.
Her politicians fear that their constituents are not as yet
ready to take such a step. They have been reassured, how-
ever, by the presidential vote of November, 1920. Ameri-
236
THE AMERICAN EMPIRE
can business life already is imperial, and political senti-
ment is moving rapidly in the same direction.
Great Britain holds title to the pickings of the world.
America wants some or all of them. The two countries
are headed straight for a conflict, which is as inevitable
as morning sunrise, unless the menace of Bolshevism grows
so strong, and remains so threatening that the great capi-
talist rivals will be compelled to join forces for the sal-
vation of capitalist society.
As economic rivalries increase, competition in military
and naval preparation will come as a matter of course.
Following these will be the efforts to make political al-
liances in the East and elsewhere.
These two countries are old time enemies. The roots
of that enmity lie deep. Two wars, the white hot feeling
during the Civil War, the anti-British propaganda, carried,
within a few years, through the American schools, the
traditions among the officers in the American navy, the
presence of 1,352,251 Irish born persons in the United
States (1910), the immense plunder seized by the British
during the War of 1914,—these and many other factors
will make it easy to whip the American people into a
war-frenzy against the British Empire.
Were there no economic rivalries, such antagonisms
might slumber for decades, but with the economic struggle
so active, these other matters will be kept continually in
the foreground.
The capitalists of Great Britain have faced dark days
and have surmounted huge obstacles. They are not to be
turned back by the threat of rivalry. The American capi-
talists are backed by the greatest available surpluses in the
world; they are ambitious, full of enthusiasm and energy,
they are flushed with their recent victory in the world war,
and overwhelmed by the unexpected stores of wealth that
have come to them as a result of the conflict. They are im-
bued with a boundless faith in the possibilities of their
country. Neither Great Britain nor the United States is
THE AMERICAN EMPIRE
237
in a frame of mind to make concessions. Each is confident
-the British with the traditional confidence of centuries
of world leadership; the Americans with the buoyant,
idealistic confidence of youth. It is one against the other
until the future supremacy of the world is decided.
6. The Imperial Task
American business interests are engaged in the work of
building an international business structure. American
industry, directed from the United States, exploiting
foreign resources for American profit, and financed by
American institutions, is gaining a footing in Latin
America, in Europe and Asia.
The business men of Rome built such a structure two
thousand years ago. They competed with and finally s
crushed their rivals in Tyre, Corinth and Carthage. In
the early days of the Empire, they were the economic
masters, as well as the political masters of the known world.
Within two centuries the business men of Great Britain
have built an international business structure that has
known no equal since the days of the Cæsars. Perhaps
it is greater, even, than the economic empire of the Romans.
At any rate, for a century that British empire of com-
merce and industry has gone unchallenged, save by Ger-
many. Germany has been crushed. But there is an in-
dustrial empire rising in the West. It is new. Its
strength is as yet undetermined. It is uncoördinated. A
new era has dawned, however, and the business men of the
United States have made up their minds to win the eco-
nomic supremacy of the earth.
Already the war is on between Great Britain and the
United States. The two countries are just as much at
war to-day as Great Britain and Germany were at war
during the twenty years that preceded 1914. The issues
are essentially the same in both cases,-commercial and
economic in character, and it is these economic and com-
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THE AMERICAN EMPIRE
mercial issues that are the chief causes of modern mili.
tary wars—that are in themselves economic wars which
may at any moment be transferred to the military arena.
British capitalists are jealously guarding the privileges
that they have collected through centuries of business and
military conflict. The American capitalists are out to se-
cure these privileges for themselves. On neither side
would a military settlement of the issue be welcomed. On
both sides it would be regarded as a painful necessity.
War is an incident in imperialist policy. Yet the position
of the imperialist as an international exploiter depends
upon his ability to make war, successfully. War is a part
of the price that the imperialist must pay for his oppor-
tunity to exploit and control the earth.
After Sedan, it was Germany versus Great Britain for
the control of Europe. After Versailles it is the United
States versus Great Britain for the control of the capital-
ist earth. Both nations must spend the next few years in
active preparation for the conflict. ,
The governments of Great Britain and the United States
are to-day on terms of greatest intimacy. Soon an issue
will arise-perhaps over Mexico, perhaps over Persia, per-
haps over Ireland, perhaps over the extension of American
control in the Caribbean. There is no difficulty of finding
a pretext.
Then there will follow the time-honored method of arous-
ing the people on either side to wrath against those across
the border. Great Britain will point to the race-riots and
negro-lynchings in America as a proof that the people of
the United States are barbarians. British editors will cite
the wanton taking of the Canal Zone as an indication of
the willingness of American statesmen to go to any lengths
in their effort to extend their dominion over the earth.
The newspapers of the United States will play up the
Irishmen more than ready to lend a hand in such an enter-
prise; tyranny in India will come in for a generous share
of comment; then there are the relations between Great
THE AMERICAN EMPIRE
239
Britain and the Turks, and above all, there are the evi-
dences in the Paris Treaty of the way in which Great
Britain is gradually absorbing the earth. Unless the
power of labor is strong enough to turn the blow, or un-
less the capitalists decide that the safety of the capitalist
world depends upon their getting together and dividing
the plunder, the result is inevitable.
The United States is a world Empire in her own right.
She dominates the Western Hemisphere. Young and in-
experienced, she nevertheless possesses the economic ad-
vantages and political authority that give her a voice in
all international controversies. Only twenty years have
passed since the organizing genius of America turned its
attention from exclusively domestic problems to the prob-
lems of financial imperialism that have been agitating
Europe for a half a century. The Great War showed
that American men make good soldiers, and it also showed
that American wealth commands world power.
With the aid of Russia, France, Japan and the United
States Great Britain crushed her most dangerous rival-
Germany. The struggle which destroyed Germany's eco-
nomic and military power erected in her stead a more
menacing economic and military power-the United States.
Untrained and inexperienced in world affairs, the master
class of the United States has been placed suddenly in the
title rôle. America over night has become a world em-
pire and over night her rulers have been called upon to
think and act like world emperors. Partly they succeeded,
partly they bungled, but they learned much. Their appe-
tites were whetted, their imaginations stirred by the vision
of world authority. To-day they are talking and writing,
to-morrow they will act no longer as novices, but as
masters of the ruling class in a nation which feels herself
destined to rule the earth.
The imperial struggle is to continue. The Japanese
Empire dominates the Far East; the British Empire
dominates Southern Asia, the Near East, Africa and
Australia; the American Empire dominates the Western
cet bunga, thetto-day
lone tion
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THE AMERICAN EMPIRE
Hemisphere. It is impossible for these three great em-
pires to remain in rivalry and at peace. Economic struggle
is a form of war, and the economic struggle between them
is now in progress.
7. Continuing the Imperial Struggle
The War of 1914 was no war for democracy in spite of
the fact that millions of the men who died in the trenches
believed that they were fighting for freedom. Rather it
was a war to make the world safe for the British Empire.
Only in part was the war successful. The old world was
made safe by the elimination of Britain's two dangerous
rivals Germany and Russia; but out of the conflict
emerged a new rival-unexpectedly strong, well equipped
and eager for the conflict.
The war did not destroy imperialism. It was fought
between five great empires to determine which one should
be supreme. In its result, it gave to Great Britain rather
than to Germany the right to exploit the undeveloped por-
tions of Asia and of Africa.
The Peace-under the form of "mandates''-makes the
process of exploitation easier and more legal than it ever
has been in the past. The guarantees of territorial in-
tegrity, under the League Covenant, do more than has
ever been done heretofore to preserve for the imperial
masters of the earth their imperial prerogatives.
New names are being used but it is the old struggle.
Egypt and India helped to win the war, and by that very
process, they fastened the shackles of servitude more firmly
upon their own hands and feet. The imperialists of the
world never had less intention than they have to-day of
quitting the game of empire building. Quite the con-
trary a wholly new group of empire builders has been
quickened into life by the experiences of the past five
years.
The present struggle for the possession of the oil fields
of the world is typical of the economic conflicts that are
involved in imperial struggles. For years the capitalists
imperial serve form ore
process, and India'being
THE AMERICAN EMPIRE
241
of the great investing nations have been fighting to con-
trol the oil fields of Mexico. They have hired brigands,
bought governors, corrupted executives. The war settled
the Mexican question in favor of the United States.
Mexico, considered internationally, is to-day a province of
the American Empire.
During the blackest days of the war, when Paris seemed
doomed, the British divided their forces. One army was
operating across the deserts of the Near East. For what
purpose ? When the Peace was signed, Great Britain held
two vantage points--the oil fields of the Near East and
the road from Berlin to Bagdad.
The late war was not a war to end war, nor was it a
war for disarmament. German militarism is not de-
stroyed; the appropriations for military and naval pur-
poses, made by the great nations during the last two years,
are greater than they have ever been in any peace years
that are known to history.
• The world is preparing for war to-day as actively as
it was in the years preceding the War of 1914. The years
from 1914 to 1918 were the opening episodes; the first
engagements of the Great War.
There is no question, among those who have taken the
trouble to inform themselves, but that the War of 1914
was fought for economic and commercial advantage. The
same rivalries that preceded 1914 are more active in the
world to-day than ever before. Hence the possibilities of
war are greater by exactly that amount. The imperial
struggle is being continued and a part of the imperial
struggle is war.
8. Again!
This monstrous thing called war will occur again! Not
because any considerable number of people want it, not
even because an active minority wills it, but because the
present system of competitive capitalism makes war in-
evitable. Economic rivalries are the basis of modern wars
and economic rivalries are the warp and woof of capitalism.
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To-day the rivalries are economic-in the fields of com.
merce and industry and finance. To-morrow they will be
Already the nations have begun the competition in the
building of tanks, battleships and airplanes. These in-
struments of destruction are built for use, and when the
time comes, they will be used as they were between 1914
and 1918.
Again there will be the war propaganda-subtle at first,
then more and more open. There will be stories of atroc-
ities; threats of world conquest. “Preparedness" will be
the cry.
Again there will be the talk of “My country, right or
wrong”; “Stand behind the President”; “Fall in line";
“Go over the top!”
Again fear will stalk through the land, while hate and
war lust are whipped into a frenzy.
Again there will be conscription, and the straightest
and strongest of the young men will leave their homes and
join the colors.
Again the most stalwart men of the nations will "dig
themselves in” and slaughter one another for years on end.
Again the truth-tellers will be mobbed and jailed and
lynched, while those who champion the cause of the
workers will be served with injunctions if they refuse to
sell out to the masters.
Again the profiteers will stop at home and reap their
harvests out of the agony and the blood of the nation.
Again, when the killing is over, a few old men, sitting
around a table, will carve the world-stripping the
vanquished while they reward the victors.
Again the preparations will begin for the next war.
They will pay and they will die for the benefit of their
masters, and thus the terrible tragedy of imperialism will
continue to bathe the world in tears and in blood.
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243
XVIII. THE CHALLENGE TO IMPERIALISM
1. Revolutionary Protest
SINCE the Franco-Prussian War the people of Europe
have been waking up to the failure of imperialism. The
period has been marked by a rapid growth of Socialism
on the continent and of trade-unionism in Great Britain.
Both movements are expressions of an increasing working-
class solidarity; both voice the sentiments of international-
ism that were sounded so loudly during the revolutionary
period of the eighteenth century.
The rapid growth of the European labor movement
worried the autocrats and imperialists. Bismarck sup-
pressed it; the Russian police tortured it. Despite all of
the efforts to check it or to crush it, the revolutionary
movement in Europe gained force. The speeches and writ-
ings of the leaders were directed against the capitalist
system, and the rank and file of the workers, rendered
sharply class conscious by the traditions of class rule, re-
sponded to the appeal by organizing new forms of protest.
The first revolutionary wave of the twentieth century
broke in Russia in 1905. The Russian Revolution of 1917
destroyed the old régime and replaced it first by a moderate
or liberal and then by a radical communist control. Like
all of the proletarian movements in Europe the Russian
revolutionary movement was directed against "capitalism"
and “imperialism” and despite the fact that there was
no considerable development of the capitalist system in
Russia, its imperial organization was so thoroughgoing,
and the imperial attitude toward the working class had
been so brutally revealed during the revolutionary demon-
strations in 1905, that the people reacted with a true
Slavic intensity against the despotism that they knew,
which was that of an autocratic, feudal master-class.
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The international doctrines of the new Russian régime
were expressed in the phrase "no forcible annexations,
no punitive indemnities, the free development of all peo-
ples.” The keynote of its internal policy is contained in
Section 16 of the Russian Constitution, which makes work
the duty of every citizen of the Republic and proclaims
as the motto of the new government the doctrine, "He that
will not work neither shall he eat." The franchise is re-
stricted. Only workers (including housekeepers) are per-
mitted to vote. Profiteers and exploiters are specifically
denied the right to vote or to hold office. Resources are
nationalized together with the financial and industrial
machinery of Russia. The Bill of Rights contained in the
first section of the Russion Constitution is a pronounce-
ment in favor of the liberty of the workers from every
form of exploitation and economic oppression.
The Russian revolution was directed against capitalism
in Russia and against imperialism everywhere. This
dramatic assault upon capitalist imperialism centered the
eyes of the world upon Russia, making her experiment
the outstanding feature of a period during which the
workers were striving to realize the possibilities of a more
abundant life for the masses of mankind.
the world cupure of a phe possi
2. Outlawing Bolshevisni
***
Capitalist diplomats were wary of the Kerensky régime
because they did not feel certain how far the Russian peo-
ple intended to go. The triumph of the Bolsheviki made
the issue unmistakably clear. There could be no peace be-
tween Bolshevism and capitalism. From that day forward
it was a struggle to determine which of the two economic
systems should survive.
: During the years 1918 and 1919 the capitalist world
organized one of the most effective advertising campaigns
that has ever been staged. Every shred of evidence that,
by any stretch of the imagination, could be distorted into
an attack upon the Bolshevist régime, was scattered broad-
THE AMERICAN EMPIRE
245
cast over the world. Where evidence was lacking, rumor
and innuendo were employed. The leading newspapers
and magazines, prominent statesmen, educators, clergymen,
scientists and public men in every walk of life went out
of their way to denounce the Russian experiment in very
much the same manner that the propertied interests of
Europe had denounced the French experiment during the
years that followed 1789.
All of the great imperialist governments had at their dis-
posal a vast machinery for the purveying of information-
false or true as the case might demand. This public ma-
chinery like the machinery of private capitalism was
turned against Bolshevism. The capitalist governments
went farther by backing with money and supplies the
counter revolutionary forces under Yudenich, Denekine,
Seminoff, and Kolchak. Allied expeditions were landed
on the soil of European and Asiatic Russia "to free the
Russian people from the clutches of the Bolsheviki.” A
blockade was declared in which the Germans were in.
vited to join (after the signing of the armistice), and
the whole capitalist world united to starve into submission
the men, women and children of revolutionary Russia.
No event of recent times, not even the holy war against
the autocracy of militarist Germany, had created such a
unanimity of action among the Western nations. Bolshe-
vism threatened the very existence of capitalism and as
such its destruction became the first task of the capitalist
world.
The collapse of the capitalist efforts to destroy socialist
Russia reflects the power of a new idea over the ancient
form. The Allied expeditions into Russia met with hos-
tility instead of welcome. The counter-revolutionary
forces were overwhelmed by the red army. The buffer
states made peace. The Allied soldiers mutinied when
called upon to take part in a war against the forces of
revolutionary Russia. “Holy Russia” became holy Russia
indeed-recognized and respected by the proletarian forces
throughout Europe.

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3. The New Europe
Russia is the dramatic center of the European movement
against capitalist imperialism, but the movement is not
confined to Russia. Its activities are extended into every
important country on the continent.
Since March, 1917, when the first revolution occurred
in Russia, absolute monarchy and divine, kingly rights
have practically disappeared from Europe. Before the
Russian Revolution, four-fifths of the people of Europe
were under the sway of monarchs who exercised dictatorial
power over the domestic and foreign affairs of their re-
spective nations. Within two years, the Hohenzollerns, the
Hapsburgs and the Romanoffs were driven from the
thrones of Germany, of Austria and of Russia. Other
rulers of lesser importance followed in their wake, until
to-day, the old feudal power that held the political control
over most of Europe in 1914 has practically disappeared.
This is the obvious thing a revolution in the form of
the Romwo years, the fairs of th
history usually deals.
But there is another revolution proceeding in Europe,
far more important because more fundamental--the eco-
nomic and social revolution; the change in the form of
breadwinning; the change in the relation between a man
and the tools that he uses to earn his livelihood.
Every one knows, now, that Czars and Kaisers and Em-
perors did not really control Europe before 1914, except
in so far as they yielded to bankers and to business men.
The crown and the scepter gave the appearance of power,
but behind them were concessions, monopolies, economic
preferments, and special privilege. The European revolu-
tion that began in 1917 with the Czar, did not stop with
kings. It began with them because they were in such plain
sight, but when it had finished with them it went right on
to the bankers and the business men.
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247
War is destruction, organized and directed by the best
brains available. It is merry sport for the organizers and
for some of the directors, but like any other destructive
agent, it may get out of hand. The War of 1914 was to
last for six weeks. It dragged on for five years, and the
wars that have grown out of it are still continuing. In
the course of those five years, the war destroyed the capi-
talist system of continental Europe. Patches and shreds
of it remained, but they were like the topless, shattered
trees on the scarred battle-fields. They were remnants-
nothing more. In the first place, the war destroyed the
confidence of the people in the capitalist system; in the
second place, it smashed up the political machinery of
capitalism; in the third place, it weakened or destroyed
the economic machinery of capitalism.
Each government, to win the war, lied to its people.
They were told that their country was invaded. They were
assured that the war would be a short affair. Besides that,
there were various reasons given for the struggle it was a
war to end war; it was a war to break the iron ring that
was crushing a people; it was a war for liberty; it was a
struggle to make the world safe for democracy.
Not a single important promise of the war was fulfilled,
save only the promise of victory. Hundreds of millions,
aroused to the heights of an exalted idealism, came back to
earth only to find themselves betrayed. Wilh less promise
and more fulfillment; with at least an appearance of states-
manship; with some respect for the simple moralities of
truth-telling, fair-dealing, and common honor, there might
have been some chance for the capitalist system to retain
the confidence of the peoples of war-torn Europe, even in
the face of the Russian Revolution; but each of these
things was lacking, and as one worker put it: “I don't
know what Bolshevism is, but it couldn't be any worse than
what we have now, so I'm for it!”
Such a loss of public confidence would have proved a
serious blow to any social system, even were it capable of
immediately reëstablishing normal conditions of living
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among the people. In this case, the same events that de-
stroyed public confidence in the capitalist system, destroyed
the system itself.
Į The old political forms of Europe--the czars, emperors
and kaisers, who stood as the visible symbols of established
The economic forces--the banks and business men—had
used these forms for the promotion of their business enter-
prises. Capitalism depended on czars and kaisers as a
blacksmith depends on his hammer. They were among the
tools with which business forged the chains of its power.
They were the political side of the capitalist system.
While the people accepted them and believed in them, the
business interests were able to use these political tools at
will. The tools were destroyed in the fierce pressure of
war and revolution, and with them went one of the chief
assets of the European capitalists.
There was a third breakdown-far more important than
--and that was the annihilation of the old economic life.
Economic life is, in its elements, very simple. Raw ma-
terials-iron ore, copper, cotton, petroleum, coal and wheat
are converted, by some process of labor, into things that
feed, clothe and house people. There are four stages in
this process raw materials; manufacturing; transporta-
tion; marketing. If there is a failure in one of the four,
all of the rest go wrong, as is very clearly illustrated when-
ever there is a great miners' or railroad workers' strike,
or when there is a failure of a particular crop. During
the war, all four of these economic stages went wrong.
Between the years 1914 and 1918 the people of Europe
busied themselves with a war that put their economic ma-
chine out of the running.
For a hundred years the European nations had been busy
building a finely adjusted economic mechanism; popula-
tion, finance, commerce-all were knit into the same system.
This system the war demolished, and the years that have
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249
followed the Armistice have not seen it rebuilt in any es-
sential particular, save in Great Britain and in some of the
neutral countries.
Not only were the European nations unable to give com-
modities in exchange for the things they needed but the
machinery of finance, by means of which these transactions
were formerly facilitated, was crippled almost beyond re-
pair. Under the old system buying and selling were
carried on by the use of money, and money ceased to be
a stable medium of exchange in Europe. It would be more
correct to say that money was no longer taken seriously in
many parts of Europe. During the war the European
governments printed 75 billions of dollars' worth of paper
money. This paper depreciated to a ridiculous extent.
Before the war, the franc, the lira, the mark and the crown
had about the same value-20 to 23 cents, or about five to
a dollar. By 1920 the dollar bought 15 francs; 23 liras;
40 marks, and 250 Austrian crowns. In some of the ready-
made countries, constituted under the Treaty or set up by
the Allies as a cordon about Russia, hundreds and thou-
sands of crowns could be had for a dollar. Even the
pound sterling, which kept its value better than the money
of any of the other European combatants, was thirty per
cent. below par, when measured in terms of dollars. This
situation made it impossible for the nations whose money
was at such a heavy discount to purchase supplies from
the more fortunate countries. But to make matters even
worse, the rate of exchange fluctuated from day to day
and from hour to hour so that business transactions could
only be negotiated on an immense margin of safety.
Add to this financial dissolution the mountains of debt,
the huge interest charges and the oppressive taxes, and the
picture of economic ruin is complete.
The old capitalist world, organized on the theory of
competition between the business men within each nation,
and between the business men of one nation and those of
another nation, reached a point where it would no longer
work.
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In Russia the old system had disappeared, and a new
system had been set up in its place. In Germany, and
throughout central Europe, the old system was shattered,
and the new had not yet emerged. In France, Italy and
Great Britain the old system was in process of disintegra-
tion-rapid in France and Italy; slower in Great Britain.
But in all of these countries intelligent men and women
were asking the only question that statesmanship could ask
--the question, “What next?”
The capitalist system was stronger in Great Britain than
in any of the other warring countries of Europe. Before !
the war, it rested on a surer foundation. During the war,
it withstood better than any other the financial and indus-
trial demands. Since the war, it has made the best re-
covery.
Great Britain is the most successful of the capitalist
states. The other capitalist nations of Europe regard her
as the inner citadel of European capitalism. The British
Labor Movement is seeking to take this citadel from within.
The British Labor Movement is a formidable affair.
There are not more than a hundred thousand members in
all of the Socialist parties, in the Independent Labor Party
and in the Communist Party combined. There are between
six and seven millions of members in the trade unions.
Perhaps the best test of the strength of the British Labor
Movement came in the summer of 1920, over the prospec-
tive war with Russia. Warsaw was threatened. Its fall
seemed imminent, and both Millerand and Lloyd-George
made it clear that the fall of Warsaw meant war. The
situation developed with extraordinary rapidity. It was
reported that the British Government had dispatched an
ultimatum. The Labor Movement acted with a strength
and precision that swept the Government off its feet and
compelled an immediate reversal of policy.
Over night, the workers of Great Britain were united in
the Council of Action. As originally constituted, the
"Labor and Russia Council of Action” consisted of five
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251
corner af the organizaree hundred special condon
representatives each from the Parliamentary Committee of
the Trades Union Congress, the Executive Committee of the
Labor Party and the Parliamentary Labor Party. To
these fifteen were added eight others, among whom were
representatives of every element in the British Labor
Movement. This Council of Action did three thingsmit
notified the Government that there must be no war with
Russia; it organized meetings and demonstrations in every
corner of the United Kingdom to formulate public opinion;
it began the organization of local councils of action, of
which there were three hundred within four weeks. The
Council of Action also called a special conference of the
British Labor Movement which met in London on August
13. There were over a thousand delegates at this confer-
ence, which opened and closed with the singing of the
"Internationale.” When the principal resolution of en-
dorsement was passed, approving the formation of the
Council of Action, the delegates rose to their feet, cheered
the move to the echo, and sang the “Internationale" and
“The Red Flag.” The closing resolution authorized the
Council of Action to take “any steps that may be necessary
to give effect to the decisions of the Conference and the
declared policy of the Trade Union and Labor Movement.”
Such was the position in the “Citadel of European
Capitalism." The Government was forced to deal with a
body that, for all practical purposes, was determining the
foreign policy of the Empire. Behind that Council was an
organized group of between six and seven millions of
workers who were out to get the control of industry into
their own hands, and to do it as speedily and as effectually
as circumstances would permit.
Meanwhile, the mantle of revolutionary activity de-
scended upon Italy, where the red flag was run up over
some the largest factories and some of the finest estates.
Throughout the war, the revolutionary movement was
strong in Italy. The Socialist Party remained consistently
an anti-war party, with a radical and vigorous propaganda.
The Armistice found the Socialist and Labor Movements
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strong in the North, with a growing movement in the South
for the organization of Agricultural Leagues.
The Socialist propaganda in Italy was very consistent
and telling. The paper “Avanti,” circulating in all parts
of the country, was an agency of immense importance.
The war, the Treaty, the rising cost of living, the growing
taxation—all had prepared the ground for the work that
the propagandists were doing. Their message was:
"Make ready for the taking over of the industries! Learn
what you can, so that, when the day comes, each will play
his part. When you get the word, take over the works!
There must be no violence that only helps the other side.
Do not linger on the streets, you will be shot. Remain at
home or stay in the factories and work as you never worked
before!"
That, in essence, was the Italian Socialist propaganda-
simple, clear and direct, and that was, in effect, what the
workers did.
The returned soldiers were a factor of large importance
in the Italian Revolution. They were radicals throughout
the war. The peace made them revolutionists. “The Pro-
letarian League of the Great War" was affiliated with “The
International of Former Soldiers,” which comprised the .
radical elements among the ex-service men of Great Britain,
Germany, France, Austria, Italy and a number of the
smaller countries. There were over a million dues-paying
members in this International, and their avowed object was
propaganda against war and in favor of an economic system
in which the workers control the industries. It was this
group in Italy-particularly in the South-that carried
through the project of occupying the estates.
The workers are in control of the whole social fabric
in Russia where the revolution has gone the farthest. In
Great Britain, where the labor movement is perhaps more
conservative than in any of the other countries of Europe,
the Government is compelled to deal with a labor move-
ment that is strong enough to consider and to decide im-
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253
portant matters of foreign policy. The workers of Italy
have the upper hand. In Czecho-Slovakia, in Bulgaria, in
Germany and in the smaller and neutral countries the
workers are making their voices heard in opposition to any
restoration of the capitalist system ; while they busy them-
selves with the task of creating the framework of a new
society.
4. The Challenge
LA
DVUC
This is the challenge of the workers of Europe to the
capitalist system. The workers are not satisfied; they are
questioning. They mean to have the best that life has to
give, and they are convinced that the capitalist system has
denied it to them.
The world has had more than a century of capitalism.
The workers have had ample opportunity to see the system
at work. The people of all the great capitalist countries—
the common people have borne the burdens and felt the
crushing weight of capitalism-in its enslavement of little
children; in its underpaying of women; in long hours of
unremitting, monotonous toil; in the dreadful housing;
in the starvation wages; in unemployment; in misery. The
capitalist system has had a trial and it is upon the workers
that the system has been tried out.
During this experiment, the workers of the world have
been compelled to accept poverty, unemployment and war.
These terrible scourges have afflicted the capitalist world,
and it is the workers and their families that have borne
them in their own persons. In those countries where the
capitalist system is the oldest, the workers have suffered
the longest. The essence of capitalism is the exploitation
of one man by another man, and the longer this exploita-
tion is practiced the more skillful and effective does the
master class become in its manipulation.
The workers look before them along the path of capi.
talist imperialism that is now being followed by the na-
tions that are in the lead of the capitalist world. There
the Tonlist system un persand the inflicted the
254
THE AMERICAN EMPIRE
they see no promise save the same exploitation, the same
poverty, the same inequality and the same wars over the
commercial rivalries of the imperial nations.
The workers of Europe have come to the conclusion that
the world should belong to those who build it; that the
good things of life should be the property of those who
produce them. They see only one course open before them
to declare that those who will not work, shall not eat.
The right of self-determination is the international ex-
pression of this challenge. The ownership of the job is its
the program of the more advanced workers in all of the
great imperial countries of the world. These ideas did not
originate in Russia, and they are not confined to Russia
any more than capitalism is confined to Great Britain.
They are the doctrines of the new order that is coming
rapidly into its own.
Capitalism has been summed up, heretofore, in the one
word "profit.” The capitalist cannot abandon that stand-
ard. The world has lived beyond it, however, and with-
out it, capitalism, as a system, is meaningless. If the capi-
talists abandon profit, they abandon capitalism.
Without profit the capitalist system falls to pieces, be-
cause it is the profit incentive that has always been consid-
ered as the binder that holds the capitalist world together.
Hence the abandonment of the profit incentive is the sur-
exploitation persists, and while there is exploitation of one
man by another, no human being can call himself free.
The capitalists are caught in a beleaguered fortress in
which they are defending their economic lives. Profit is
the key to this fortress, and if they surrender the key, they
are lost.
5. The Real Struggle
This is the real struggle for the possession of the earth.
Shall the few own and the many labor for the few, or the
many own, and labor upon jobs that they themselves pos-
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255
sess? The struggle between the capitalist nations is inci-
dental. The struggle between the owners of the world and
the workers of the world is fundamental.
If Great Britain wins in her conflict with the United
States, her capitalists will continue to exploit the workers
of Lancashire and Delhi. Her imperialists will continue
their policy of world domination, subjugating peoples and
utilizing their resources and their labor for the enrichment
If the United States wins in her struggle with Great
of the bankers and traders of London.
Britain, her capitalists will continue to exploit the workers
of Pittsburg and San Juan. Her imperialists will continue
their policy of world domination, subjugating the peoples
of Latin American first, and then reaching out for the con-
trol over other parts of the earth.
No matter what imperial nation may triumph in this
struggle between the great nations for the right to exploit
the weaker peoples and the choice resources, the struggle
between capitalism and Socialism must be fought to a fin-
ish. If the capitalists win, the world will see the introduc-
tion of a new form of serfdom, more complete and more
effective than the serfdom of Feudal Europe. If the So-
cialists win, the world enters upon a new cycle of develop-
ment.

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XIX. THE AMERICAN WORKER AND WORLD
EMPIRE
1. Gains and Losses
THE American worker is a citizen of the richest country
of the world. Resources are abundant. There is ample
machinery to convert these gifts of nature into the things
that men need for their food and clothing, their shelter,
their education and their recreation. There is enough for
all, and to spare, in the United States.
But the American worker is not master of his own des-
tinies. He must go to the owners of American capital-to
the plutocrats—and from them he must secure the permis-
sion to earn a living; he must get a job. Therefore it is the
capitalists and not the workers of the United States that
are deciding its public policy at the present moment.
The American capitalist is a member of one of the most
powerful exploiting groups in the world. Behind him are
the resources, productive machinery and surplus of the
American Empire. Before him are the undeveloped re-
sources of the backward countries. He has gained wealth
and power by exploitation at home. He is destined to
grow still richer and more powerful as he extends his or-
ganization for the purposes of exploitation abroad.
The prospects of world empire are as alluring to the
American capitalist as have been similar prospects to other
exploiting classes throughout history. Empire has always
been meat and drink to the rulers.
The master class has much to gain through imperialism.
The workers have even more to lose.
The workers make up the great bulk of the American
people. Fully seven-eighths (perhaps nine-tenths) of the
adult inhabitants of the United States are wage earners,
THE AMERICAN EMPIRE
257
.
clerks and working farmers. All of the proprietors, offi-
cials, managers, directors, merchants (big and little), law-
yers, doctors, preachers, teachers, and the remainder of the
business and professional classes constitute not over 10 or
12 percent of the total adult population. The workers are
the “plain people” who do not build empires any more
than they make wars. If they were left to themselves,
they would continue the pursuit of their daily affairs which
takes most of their thought and energy-and be content to
let their neighbors alone.
2. The Workers' Business
The mere fact that the workers are so busy with the
routine of daily life is in itself a guarantee that they will
mind their own business. The average worker is engaged,
outside of working hours, with the duties of a family. His
wife, if she has children, is thus employed for the greater
portion of her time. Both are far too preoccupied to in-
terfere with the like acts of other workers in some other
portion of the world. Furthermore, their preoccupation
with these necessary tasks gives them sympathy with those
similarly at work elsewhere.
The plain people of any country are ready to exercise
even more than an ordinary amount of forbearance and
patience rather than to be involved in warfare, which wipes
out in a fortnight the advantages gained through years
of patient industry.
The workers have no more to gain from empire building
than they have from war making, but they pay the price
of both. Empire building and war making are Siamese
twins. They are so intimately bound together that they
cannot live apart. The empire builder-engaged in con-
quering and appropriating territory and in subjugating
peoples-must have not only the force necessary to set up
the empire, but also the force requisite to maintain it.
Battleships and army corps are as essential to empires as
nadgram Tir
minus.
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THE AMERICAN EMPIRE
mortar is to a brick wall. They are the expression of the
organized might by which the empire is held together.
The plain people are the bricks which the imperial class
uses to build into a wall about the empire. They are the
mortar also, for they man the ships and fill up the gaps
in the infantry ranks and the losses in the machine gun
corps. They are the body of the empire as the rulers are
its guiding spirit.
When ships are required to carry the surplus wealth of
the ruling class into foreign markets, the workers build
them. When surplus is needed to be utilized in taking ad-
vantage of some particularly attractive investment oppor-
tunity the workers create it. They lay down the keels of
the fighting ships, and their sons aim and fire the guns.
They are drafted into the army in time of war and their
bodies are fed to the cannon which other workers in other
countries, or perhaps in the same country, have made for
just such purposes. The workers are the warp and woof
of empire, yet they are not the gainers by it. Quite the
contrary, they are merely the means by which their mas-
ters extend their dominion over other workers who have
not yet been scientifically exploited.
The work of empire building falls to the lot of the work-
ers. The profits of empire building go to the exploiting
class.
3. The British Workers
What advantage came to the workers of Rome from the
Empire which their hands shaped and which their blood
cemented together? Their masters took their farms, con-
verted the small fields into great, slave-worked estates, and
drove the husbandmen into the alleys and tenements of the
city where they might eke out an existence as best they
could. The rank-and-file Roman derived the same advan-
tage from the Roman Empire that the rank-and-file Briton
has derived from the British Empire.
THE AMERICAN EMPIRE
259
Great Britain has exercised more world mastery during
the past hundred years than any other nation. All that
Germany hoped to achieve Great Britain has realized. Her
traders carry the world's commerce, her financiers clip
profits from international business transactions, her manu-
facturers sell to the people of every country, the sun never
sets on the British flag.
Great Britain is the foremost exponent and practitioner
of capitalist imperialism. The British Empire is the great-
est that the world has known since the Empire of Rome
fell to pieces. Whatever benefits modern imperialism
brings either for capitalists or for workers should be en-
joyed by the capitalists and workers of Great Britain.
Until the Great World War the capitalists of Great
Britain were the most powerful on earth with a larger
foreign trade and a larger foreign investment than any
other. At the same time the British workers were amongst
the worst exploited of those in any capitalist country in
Europe.
The entire nineteenth century is one long and terrible
record of master-class exploitation inside the British Isles.
The miseries of modern India have been paralleled in the
lives of the workers of Ireland, Scotland, Wales and Eng.
land. Gibbins, in his description of the conditions of the
child workers in the early years of the nineteenth century
ends with the remark, “One dares not trust oneself to try
and set down calmly all that might be told of this awful
page of the history of industrial England.” 1
Even more revolting are the descriptions of the condi-
tions which surrounded the lives of the mine workers in
the early part of the nineteenth century. Women as well
as men were taken into the mines and in some cases, as the
reports of the Parliamentary investigation show, the
women dragged cars through passage-ways that were too
low to admit the use of ponies or mules.
1 "Industry in England,” H. deB. Gibbins. New York, Scribner's,
1897, p. 390.
260
THE AMERICAN EMPIRE
England, mistress of the seas, proud carrier of the traf-
fic of the world, the center of international finance, the
richest among all the investing nations-England was reek-
ing with poverty. Beside her factories and warehouses
were vile slums in which people huddled as Ruskin said,
"so many brace to a garret." There in the back alleys
of civilization babies were born and babies died, while.
those who survived grew to the impotent manhood of the
street hooligan..
The British Empire girdled the world. For a century
its power had grown, practically unchallenged. Super-
ficially it had every appearance of strength and permanence
but behind it and beneath it were the hundreds of thou-
sands of exploited factory workers, the underpaid miners,
the Cannon Gate of Edinburgh and the Waterloo Junc-
tion of London.mperialism has the rise of the the stalw
Capitalist imperialism has not benefited the British
workers. Quite the contrary, the rise of the Empire has
been accompanied by the disappearance of the stalwart
English yeoman; by the disappearance of the agricultural
population; by the concentration of the people in huge in-
dustrial towns where the workers, no longer the masters of
their own destinies, must earn their living by working at
machines owned by the capitalist imperialists. The sur-
plus derived from this exploited labor is utilized by the
capitalists as the means of further extending their power
in foreign lands.
Imperialism has brought not prosperity, but poverty to
the plain people of England.
There is another aspect of the matter. If these degraded
conditions attach to the workers in the center of the em-
* pire, what must be the situation among the workers in
the dependencies that are the objects of imperial exploita-
tion?. Let the workers of India answer for Great Britain;
the workers of Korea answer for Japan, and the workers
of Porto Rico answer for the United States. Their lot is
worse than is the lot of the workers at the center of imperial
power.
THE AMERICAN EMPIRE
261
Empires yield profits to the masters and victory and
glory to the workers. Let any one who does not believe this
compare the lives of the workers in small countries like
Holland, Norway, Denmark and Switzerland, with the lives
of the workers in the neighboring empiresRussia, Ger-
many, France and Great Britain. The advantage is all on
the side of those who live in the smaller countries that are
minding their own affairs and letting their neighbors alone.
4. The Long Trail
The workers of the United States are to-day following
the lead of the most powerful group of financial im-
perialists in the world. The trail is a long one leading
to world conquest, unimagined dizzying heights of world
power, riches beyond the ken of the present generation,
and then, the slow and terrible decay and dissolution that
sooner or later overtake those peoples that follow the paths
of empire. The rulers will wield the power and enjoy the
riches. The people will struggle and suffer and pay the
price.
The American plutocracy is out to conquer the earth be-
cause it is to their interest to do so. The will-o'-the-wisp
of world empire has captured their imaginations and they
are following it blindly.
The American people, on November 2, 1920, gave the
American imperialists a blanket authority to go about their
imperial businessman authority that the rulers will not be
slow to follow. First they will clean house at home-
that housecleaning will be called “the campaign for the es-
tablishment of the open shop.” Then they will go into
Mexico, Central America, China, and Europe in search of
markets, trade and investment opportunities.
Behind the investment will come the flag, carried by
battle-ships and army divisions. That flag will be brought
front to front with other flags, high words will be spoken,
blood will flow, life will ebb, and the imperialists will win
their point and pocket their profit.
262
THE AMERICAN EMPIRE
Behind them, in November, and at all other times of the
year, there will be the will, expressed or implied, of the
working people of the United States, who will produce the
surplus for foreign investment; will make the ships and
man them; will dig the coal and bore for the oil; will shape
the machines. Their hands and the hands of their sons
will be the force upon which the ruling class must depend
for its power. They will produce. while the ruling class
consumes and destroys.
the trail is a long one, but it leads none the less cer-
tainly to isolation and death. No people can follow the
imperial trail and live. Their liberties go first and then
their lives pay the penalty of their rulers' imperial ambi-
tion. It was so in the German Empire. It is so to-day
in the British Empire. To-morrow, if the present course
is followed, it will be equally true in the American Empire.
5. The New Germany
One of the chief charges against the Germans, in 1914,
was that they were not willing to leave their neighbors in
peace. They were out to conquer the world, and they
did not care who knew it. It was not the German people
who held these plans for world conquest, it was the Ger-
man ruling class. The German people were quite willing
to stay at home and attend to their own affairs. Their
rulers, pushed by the need for markets and investment op-
portunities, and lured by the possibilities of a world em-
pire, were willing to stake the lives and the happiness of
the whole nation on the outcome of these ambitious schemes.
They threw their dice in the great world game of interna-
tional rivalries—threw and lost; but in their losing, they
carried not only their own fortunes, but the lives and the
homes and the happiness of millions of their fellows whose
only desire was to remain at home and at peace.
Germany's offense was her ambition to gain at the ex-
pense of her neighbors. Lacking a place in the sun, she
proposed to take it by the strength of her good right arm.
THE AMERICAN EMPIRE
263
cans, a broken in the han the United State, point. The
This is the method by which all of the great empires have
been built and it is the method that the builders of the
American Empire have followed up to this point. The
land which the ruling class of the United States has needed
has heretofore been in the hands of weak peoples-Indians,
Mexicans, a broken Spanish Empire. Now, however, the
time has come when the rulers of the United States, with
the greatest wealth and the greatest available resources of
any of the nations, are preparing to take what they want
from the great nations, and that imperial purpose can be en-
forced in only one way—by a resort to arms. The rulers
of the United States must take what they would have by
force, from those who now possess it. They did not hesi-
tate to take Panama from Colombia; they did not hesitate
to take possession of Hayti and of Santo Domingo, and
they do not propose to stop there.
The people of the world know these things. The in-
habitants of Latin America know them by bitter experience.
The inhabitants of Europe and of Asia know them by
hearsay. Both in the West and in the East, the United
States is known as “The New Germany.” .
That means that the peoples of these countries look upon
the United States and her foreign policies in exactly the
same way that the people of the United States were taught
to regard Germany and her foreign policies. To them the
United States is a great, rich, brutal Empire, setting her
heel and laying her fist where necessity calls. Men and
women inside the United States think of themselves and of
their fellow citizens as human beings. The people in the
other countries read the records of the lynchings, the rob- ,
beries and the murders inside the United States; of the
imperial aggression toward Latin America, and they are
learning to believe that the United States is made up of
ruthless conquerors who work their will on those that cross
their path.
The plain American men and women, living quietly in
their simple homes, are none the less citizens of an ag- .
gressive, conquering Empire. They may not have a
264
THE AMERICAN EMPIRE
thought directed against the well-being of a single human
creature, but they pay their taxes into the public treasury;
they vote for imperialism on each election day; they read
imperialism in their papers and hear it preached in their
churches, and when the call comes, their sons will go to
the front and shed their blood in the interest of the imperial
class.
The plain people of the German Empire did not desire
to harm their fellows, nevertheless, they furnished the
cannon-fodder for the Great War. America's plain folks,
by merely following the doctrine, “My country, right or
wrong-America first!” will find themselves, at no very
distant date, exactly where the German people found them-
selves in 1914.
6. The Price
The historic record, in the matter of empire, is uniform.
The masters gain; the workers pay.
The workers of the United States will not be exempt
from these inexorable necessities of imperialism. On the
contrary they will be called upon to pay the same price
for empire that the workers in Britain have paid ; that the
workers in the other empires have paid. What is the price ?
What will world empire cost the American workers ?
1. It will cost them their liberties. An empire cannot
be run by a debating society. Empires must act. In order
to make this action mobile and efficacious, authority must
be centered in the hands of a small group—the ruling
class, whose will shall determine imperial policy. Self-
government is inconsistent with imperialism.
2. The workers will not only lose their own liberties,
but they will be compelled to take liberties away from the
peoples that are brought under the domination of the Em-
pire. Self-determination is the direct opposite of im-
perialism.
3. The American workers, as a part of the price of
empire, will be compelled to produce surplus wealth-
THE AMERICAN EMPIRE
265
wealth which they can never consume; wealth the control
of which passes into the hands of the imperial ruling class,
to be invested by them in the organization of the Empire
and the exploitation of the resources and other economic
opportunities of the dependent territory.
4. The American workers must be prepared to create
and maintain an imperial class, whose function it is to de-
termine the policies and direct the activities of the Empire.
This class owes its existence to the existence of empire,
without which such a ruling class would be wholly un-
necessary.
5. The American workers must be prepared, in peace
time as well as in war time, to provide the “sinews of war”:
the fortifications, the battle fleet, the standing army and the
vast naval and military equipment that invariably accom-
pany empire.
6. The American workers must furthermore be ready,
at a moment's call, to turn from their occupations, drop
their useful pursuits, accept service in the army or in the
navy and fight for the preservation of the Empire-against
those who attack from without, against those who seek the
right of self-determination within.
7. The American workers, in return for these sacrifices,
must be prepared to accept the poverty of a subsistence
wage; to give the best of their energies in war and in peace,
and to stand aside while the imperial class enjoys the fat
of the land.:
7. A Way Out
If the United States follows the course of empire, the
workers of the United States have no choice but to pay the
price of Empire-pay it in wealth, in misery, and in blood.
But there is an alternative. Instead of going on with the
old system of the masters, the workers may establish a
new economic system--a system belonging to the workers,
and managed by them for their benefit.
266
THE AMERICAN EMPIRE
The workers of Europe have tried out imperialism and
they have come to the conclusion that the cost is too high,
Now they are seeking, through their own movement-the
labor movement to control and direct the economic life of -
Europe in the interest of those who produce the wealth
and thus make the economic life of Europe possible.
The American workers have the same opportunity. Will
they avail themselves of it? The choice is in their hands.
Thus far the workers of the United States have been,
for the most part, content to live under the old system, so
long as it paid them a living wage and offered them a job.
The European workers felt that too in the pre-war days,
but they have been compelled by the terrible experiences
of the past few years to change their minds. It was no
longer a question of wages or a job in Europe. It was a
question of life or death.
Can the American worker profit by that experience ?
Can he realize that he is living in a country whose rulers
have adopted an imperial policy that threatens the peace
of the world? Can he see that the pursuit of this policy
means war, famine, disease, misery and death to millions
in other countries as well as to the millions at home? The
workers of Europe have learned the lesson by bitter ex-
perience. Is not the American worker wise enough to
profit by their example?
THE END
INDEX.
Advertising imperialism, 169
America, conquest of, 27
America first, 170
America for Americans, 202
American capitalists, 218
66
or program of, 226
empire, costs of, 160
course of, 158
66 development of, 15
16 economic basis of, 74
growth of, 161
imperialism, 23
Indian, 29
industries, growth of, 178
people, ancestry, 159
protectorates, 207
Republic, disappearance of, 72
tradition, failure of, 12
co worker and empire, 256
Anti-imperialism, 68
Appropriation of territory, 213
Automobile distribution, 183
Bankers, unity of, 150
Bethlehem Steel Co., 132
British Empire, gains of, 198
66 position of, 234
a Labor, position of, 250
Business control, 148
Canada, investments in, 206
Capitalism and Bolshevism, 244
" war, 225
breakdown of, 248
law of, 223
Cherokees, dealings with, 33
no
Class government, 10
s struggle, in Europe, 254
Coal reserves, 180
Cohesion of wealth, 86, 118
Competition, ferocity of, 223
Competitive industry, 75
Conquering peoples, 26
Conquest of the West, 49
Council of Action, organization, 250
66 " National Defense, 148
Culan independence, 66
or treaty, 208
Dictatorship, possibility of, 222
Dominican Republic, relations with, 209
Education for imperialism, 169
Empire and British workers, 258
characteristics of, 15
definition of, 16
evolution of, 22
prevalence of, 17
price of, 20, 264
stages in, 19
workers and, 262
Empires, the Big Four, 231
Europe, financial breakdowu, 249
66 revolution in, 246
Financial imperialism, 135
Foreign investments, 131
France, gains of, 197
Government and business, 99
Great Peace, 36
Great War, 143
66 " advantages of, to the United States, 157
66 66 next incidents of, 235
66 66 results of, 240
Guaranty Trust Company, 136
Hawaii, annexation of, 62
revolution in, 63
Hayti, conditions in, 210
Immigrants, race of, 160
16
Imperial alignment, 229
goal, 222
purpose, 165
sentiments, 166
task, 237
" " nature of, 228
Imperialism, advantages of, 256
beginnings of, 65
challenge to, 243
cost of, 261
establishment of, 72
failure of, 243
psychology of, 170
Imperialists, training of, 219
Incomes, in the United States, 115
Industrial combination, 81
" organization, 78
" revolution, 76
International exploitation, 128
66 finance, 135
66 Harvester Co., 133
Investing nations, 127
Investment bankers, 86
Investments in the United States, 130
Italy, gains of, 197
Job ownership, 94
Labor, colonial shortage of, 38
Landlordism, 105
Land ownership, 103
" policy, 104
Latin America, 203
Liberty, desire for, 8
Manifest destiny, 171
Mastery, avenues of, 92
Mexican War, provocation of, 55
6 or success of, 56
Mexico, conquest of, 54
Monroe Doctrine, 202
66 logic of, 207
National City Bank, 138
Navy League, 146
Negró civilization, in Africa, 40
ir slaves, values of,' 47
Negroes, numbers enslaved, 43
New Europe, 246
Next War, contestants in, 236
" or preparations for, 241
66 66 pretexts for, 238
New Orleans, struggle for, 50
Ownership, advantages of, 114
Panama, relations with, 213
or revolution in, 215
seizure of, 214
Patriotism, 147
Peace Treaty, provisions of, 224
" " results of, 194
Personal incomes, sources of, 116
Philippines, conquest of, 69
Plutocracy, 117
control of, 148
dictatorship of, 92
domestic power of, 153
economic gains of, 151
so growing power of, 143
Popular government, I
Population, increase of, 50
Preparedness, 145
Press censorship, 210
Product ownership, 96
Profiteering, 151
Property, Indian ideas of, 30
ownership, security of, 107
rights, and civilization, 113
rights of, 103
safeguards to, 108
Public opinion, control of, 98
Resources of the United States, 179
Revolution in Europe, 246
Russia, Allied attack on, 245
" world position of, 231
66
no
Slave Coast, 39
16
power, defeat of, 61
or trade, America's part in, 44
" beginnings of, 39
os o conditions of, 43
development of, 42
Slavery, and expansion, 60
or beginnings of, 39
ut in the United States, 45
Slaves, early demand for, 41
Southwest, conquest of, 51, 57
Sovereignty, source of, 11
Spanish War, 65
Standard Oil Co., 134
Surplus, disposal of, 123
pressure of, 121
Teutonic peoples, 26
Texas, annexation of, 52
Timber reserves, 180
Transportation facilities, 183
Undeveloped countries, 124
United States, capital of, 181
financial power of, 154
past isolation, 192
position of, 221
products of, 184
resources of, 179
66 66
shipping, 188
wealth and income, 189
co 66 world attitude to, 263
world power of, 177
Wealth and income, 189
of the United States, 89
ownership, 90
Western Hemisphere, and the United States, 200
World conquest, 218
Workers' business, 257
Yellow peril, 232
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