cfc_19121130.pdf

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Bank Sc Quotation SectionRailway Earnin7,s Section

INCLUDING

Railway &: Industrial SectionBankers' Convention Section

Finttstm tde

Electric Railway SectionState and City Section

VOL. 95 SATURDAY, NOVEMBER 30 1912 NO. 2475

The Thronicle... PUBLISHED WEEKLY.

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Published every Saturday morning by', WILLIAM B. DANA COMPANY,Jacob Seibert Jr., President and Treas.; George S. Dana and Arnold G. Dana,Vice-Presidents; Arnold G. Dana, Sec. Addresses of all, Office of the Company.

CLEARING-HOUSE R TURNS.The following table, made up by telegra h, Jul., indicates that the

total bank clearings of all clearing houses of th. United States for the weekending Nov. 30 have been $3,226,781,091 a-,ainst $3,600,750,376, lastweek and $3,118,298,464 the corresponding week last year.

Clearings-Returns by Telegraph.Week ending Nov. 30, 1912.

Per1911. Cent.

New York Boston Philadelphia Baltimore Chicago St. Louis New Orleans

Seven cities, five days Other cities, five days

Total all cities five days All cities, one day

$1,414,452,418107,293,646111,469,53227,482,443

213,508,34059,406,48417,312,097

$1,363,346,072115,588,567

I 112,597,80526,166,356l'6,053,90364,600,99416,042,808

+3.8-7.2-1.0+5.0+8.9+8.8+7.9

$1,950,924,960 $1,884,396,595 +3.5575,418,209 452,647,286 +27.1

$2,526,343,169 $2,337,043,881 +8.1700,437,922 781,254,583 -10.3

Total all cities week $3,226,781,091 $3,118,298,464 +3.5The full details for the week covered by the above will be given next .

Saturday. We cannot furnish them to-day, clearings being made by theclearing houses at noon on Saturday, and hence in the above the last day ofthe week has to be in all cases estimated, as we go to press Friday night.We present below detailed figures for the week ending with Sdturday

noon, Nov. 23 for four years.

Clearings at-

New York PhiladelphiaPittsburgh Baltimore Buffalo Albany Washington _Rochester Scranton Syracuse Reading Wilmington Wilkes-BarreWheeling Trenton York Erie Greensburg __Chester Binghamton ___Altoona Lancaster Montclair

Total Middle_ _Boston Providence Hartford New Haven Springfield I'ortland Vorcester Fall River New BedfordLowellHolyoke Bangor

Tot. New Eng.

Week ending November 23.

1912. 1911.I fic . Or

Dec. 1910. 1909.

8 $ % $ 32,015,377,697 1,819,279,401 +10.8 1,547,838,251 1,879,491,105182,110,320 148,314,952 +22.4 130,869,828 129,776,38858,499,387 50,772,588 +15.2 44,297,340 47,233,48641,987,335 38,584,986 +8.8 28,696,291 28,577,09213,041,713 10,806,466 +20.7 8,726,215 8,873,3296,411,828 6,439,848 -0.4 5,296,120 5,430,9477,329,109 6,956,083 +5.4 0,373,144 6,580,5434,713,140 4,153,584 +13.5 3,123,147 3,206,3303,191,576 2,486,293 +38.3 2,429,055 2,215,9292,676,109 2,199,435 +21.7 1,864,362 2,028,1761,779,125 1,728,923 +3.0 1,449,609 1,590,8241,678,941 1,267,795 +32.4 1,318,473 1,116,8101,084,420 1,454,664 +15.8 1,228,643 1,224,7072,307,569 1,800,508 +28.2 1,469,184 1,451,8752,168,666 1,726,403 +25.6 1,491,170 1,305,615964,477 912,143 +5.7 807,688 802,474

1,029,215 871,047 +18.1 715,217 665,051500,000 495,930 +0.8 342,973 396,402701,146 491,273 +42 8 520,015 427,664655,000 493,500 +32.5 557,500 321,500577,088 494,266 +16.8 404,776 420,500

1,551,635 848,529 +82.8 809,851 _

356,353 Not included In total

2,346,944,496 2,102,578,617 +11.6 1,790,629,052 2,124,607,547103,952,065 166,210,640 -1.3 135,073,301 144,870,7389,760,000 7,156,100 +36.4 7,606,900 7,905,6004,453,882 4,063,925 +9.6 3,449,270 3,489,2112,822,243 2,756,140 +2.4 2,164,229 2,147,0312,602,301 2,145,177 +21.3 1,759,211 2,000,0002,245,081 2,071,438 +8.4 1,877,066 1,622,3292,634,215 2,125,888 +23.9 2,150,710 1,482,8111,369,076 1,303,468 +5.0 1,333,123 1,119,0221,061,372 976,636 +8.7 987,574 1,133,637519,968 529,763 -1.8 499,142 409,060660,000 600,000 +10.0 509,470 495,859707,875 521,262 +35.8

109 720 n7u Ion Arm .4,27 .1.17 1A7 Ann one lAK onm gno

Note.-For Canadian Clearings see "Commercial and Miscellaneous News."

Clearings at

Chicago Cincinnati Cleveland Detroit Milwaukee _ _Indianapolis .._ _ _Columbus Toledo Peoria Grand Rapids Dayton Evansville Kalamazoo Springfield, 111....Fort Wayne __Akron Lexington Youngstown _Rockford Canton Quincy Springfield, 0 South Bend Bloomington_ __ _Mansfield Decatur Jackson Danville Lima Lansing Jacksonville, 111_Ann Arbor Adrian Owensboro Tot.Mid,West.

San Francisco-.Los Angeles Seattle Portland Spokane Salt Lake City Tacoma Oakland Sacramento San Diego Fresno Stockton Pasadena San Jose North Yakima_Reno Total Pacific

Kansas City_ __Minneapolis _Omaha St. Paul Denver Duluth St. Joseph Des Moines Sioux City Wichita Topeka Lincoln Davenport Cedar Rapids_ .._Fargo Colorado SpringsPueblo Fremont Hastings Aberdeen Waterloo Helena Billings Tot.Oth :West _

St. Louis New Orleans_ _ _ _Louisville Houston Galveston Memphis Fort Worth Richmond Atlanta Savannah Nashville Norfolk Birmingham _Augusta JacksonvilleKnoxville Little Rock Chattanooga_ _Charleston Mobile Oklahoma Macon Austin Wilmington,N.C.Vicksburg Jackson Muskogee Tulsa

Total Southern

Week ending November 23.

Inc. or1912. 1911. I Dec. 1 1910. 1909.

$ $ % $ $322,273,314 274,215,111 +17.5 229,096,794 238,247,64326,224,700 24,894,300 +5.3 22,317,600 23,279,25023,329,749 18,923,531 +23.3 16,240,066 15,074,67524,875,483 19,614,496 +26.8 16,304,759 14,050,00015,532,590 13,034,691 +19.1 10,959,778 11,119,8698,672,319 8,886,606 -2.4 8,407,958 7,186,2926,754,000 5,596,400 +20.7 5,284,200 5,367,0005,305,314 4,084,188 +29.9 3,658,662 3,138,8123,957,145 3,825,655 +3.4 3,193,353 2,616,5463,554,321 2,974,594 +19.5 2,234,351 2,010,6642,307,750 2,053,816 +12.4 1,651,481 1,484,0902,434,434 2,571,387

-5.3 1,972,000 1,775,580875,142 697,533 +25.5 537,582 591,373

1,142,273 926,398 +23.3 758,529 751,6151,136,172 912,589 +24.6 815,436 804,3852,058,000 1,417,000 +45.2 803,000 797,700954,101 869,320 +9.8 845,893 838,966

1,523,248 1,025,605 +48.6 782,428 715,665896.396 860,562 +4.2 886,811 743,691

1,271,776 1,116,529 +13.9 915,812 670,000769,652 638,962 +20.5 533,115 485,077570,087 406,335 +40.4 487,515 423,342

1,600,000 521,959 +206.7 421,131 350,559618,716 620,453 -0.3 542,607 429,240501,194 398,161 +25.9 326,399 . 302,512464,728 330,383 +40.7 356,607 324,537550,000 500,000 +10 0 334,881 258,500449,236 449,908 -0,1' 376,205 449,244452,236 327,433 +38.2 280,325 277,005450,000 381,072 +18.1' 410,214 255,553 255,015 +0.2 192,846 271,382195,401 147,273 +32.7 131,264 117,70940.000 43,346 -7.7 36,274 26,946

442,170 497,761 -11.0 366,283 350,000462,437,180 394,018,372 +17.4 332,095,876 335,329,86960,464,489 53,513,393 +13.0 42,340,016 36,651,29027,215,349 19,475,055 +39.8 15,328,820 12,841,32512,611,908 9,862,449 +27.9 9,645,427 11,683,41012,315,612 11,439,756 +7.7 9,652,375 7,110,3314,825,378 4,303,803 +12.2 4,314,550 4,091,3468,704,299 9,190,717 -5.3 6,944,115 6,926,3914,467,650 4,389,506 +1.8 3,713,405 5,304,7293,826,323 3,269,434 +17.0 2,684,401 1,939,1962,452,202 1,864,092 +31.5 1,481,154 1,062,7252,875,959 2,000,000 +43.8 1,172,270 874,0381,600,406 1,262,126 +26.8 781,376 619,7621,536,873 1,150,692 -1.3 633,193 498,2261,202,483 817,329 +47.1 611,801 500,000863,612 865,530 -0.2 461,861 528,307472,444 419,272 +12.6 497,618 354,956300,180 300,000 +0.06 229,932 220,638

145,335,172 124,123,154 +17.1 100,492,314 91,206,670

61,805,269 52,585,136 +17.5 45,989,356 44,365,69133,230,529 25,841,885 +28.9 21,636,880 24,430,43318,093,105 13,590,121 +33.1 13,623,576 13,129,10116,098,800 13,123,990 +22.7 10,367,864 13,337,11811,872,975 11,058,826 4-7.4 9,606,267 10,073,3529,735,518 6,330,036 +53.8 4,324,243 5,595,1217,188,592 6,916,939 +3.9 5,395,162 5,038,0254,855,247 3,789,218 +28.1 3,132,782 2,941,2142,900,000 2,344,506 +23.7 2,273,732 2,501,2543,540,105 3,364,475 +5.2 2,969,011 2,437,9921,677,894 1,549,862 +8.3 1,404,177 1,215,5421,764,643 1,443,428 +22.2 1,275,711 1,243,6091,515,770 1,463,543 +3.6 1,462,236 1,262,2151,680,424 1,075,900 +56.2 1,200,000 1,104,322534,184 883,613 -39.5 675,708 930,609738,028 630,178 +17.1 602,547 629,343

1,461,177 1,055,263 +38.5 748,496 842,464278,818 276,724 +0.8 204,411 217,862178,066 164,517 +8.2 160,783 375,000 343,076 +9.3 395,032 500,000

1,478,340 1,013,943 +45.9 899,244 1,339,042 1,011,251 +32.4 946,291 851,843440,000 350,000 +25.7 153,444 328,941

182,871,526 150,206,430 -21.7 129,446,953 132,976,051

87,160,318 80,805,209 +7.8 68,626,967 60,221,83827,209,071 24,342,277 +11.8 22,085,938 19,541,98513,668,273 12,633,095 +8.2 11,657,933 11,986,71523,620,074 19,906,629 +18.7 13,294,063 12,800,00012,106,500 12,434,500 -2.6 8,029,000 7,345,00013,222,880 11,167,857 +18.4 9,851,965 6,319,94211,857,071 8,787,846 +34.9 7,759,854 7,799,2539,051,086 7,863,679 +15.1 5,934,041 7,154,62617,085,469 16,809,617 +1.6 12,042,897 10,327,1057,735,514 7,367,403 +5.0 7,061,694 3,939,3427,735,705 4,627,685 +67.2 3,409,137 2,298,4035,073,092 3,957,876 +28.2 3,217,231 2,730,4243,475,288 2,808,003 +23.8 2,748,925 2,334,1363,073,253 2,891,565 +3.1 2,576,568 2,554,8013,283,401 3,100,000 +5.9 2,291,898 1,641,2262,101,588 1,730,376 +21.4 1,600,000 1,562,8213,210,582 2,496,374 +28.7 2,317,549 1,768,5532,591,885 2,399,188 +8.0 1,804,089 1,309,8942,315,105 2,538,447 -8.8 2,253,642 1,666,3881,750,000 1,524,147 +14.8 1,464,490 1,315,7832,083,146 2,375,594 -12.7 2,300,000 1,923,1395,088,262 4,996,948 +1.8 1,200,000 950,0002,322,083 1,905,136 +21.9 1,370,296 865,261750,000 866,036 -13.4 789,712 490,767467,419 391,293 +19.4 479,809 380,873495,644 439,214 +12.8 375,000 429,000

1,079,967 843,287 +28.0 763,248 587,273 +34.6

270,373,924 242,664,554 +11.4 196!542,64-3171;i-47,265 n ono ntn ntn o A00 ,TA0 OAATotal all n nnit orn nonln nnA ACI .AA . 12 .4

Outside N. Y_ 1.585,372,67911,384.772,163 +14.5 1,158,778,638 1,141,581.695

Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1432 THE CHRONICLE [Vol, Lxxxxv.

STATE AND CITY SECTION.With to-day's issue of the "Chronicle" we send to

our subscribers a new number of our "State and CitySection" revised to date.

THE FINANCIAL SITUATION.The award of the Arbitration Commission ap-

pointed to pass upon the demands of the locomotiveengineers on the roads east of Chicago and north ofthe Ohio River for increased wages, is a disappoint-ment, because it partakes of the characteristics ofarbitration decisions in general in being mainly acompromise. But the report on which the awardis based is even more a disappointmentin everyway and from every standpoint. It is impossibleto read this labored document without being reluc-tantly forced to the conclusion that the five memberswho constituted the arbitrators (the other two mem-bers representing the two parties to the controversy)did not know their own minds as to most of the thingsdiscussed. The writer of the report, or at least thebulk of itpresumably the Chairman of the Com-mission, Charles R. Van use, President of the Uni-versity of Wisconsinstrives industriously to main-tain an appearance of impartiality, and signally fails.He dwells upon the "extraordinary complexity of theproblems before the -board," and presents the factsin support of the statement with a degree of direct-ness and force that could hardly be surpassed. Andyet with strange inconsistency he proceeds furtherto complicate the matter by entering into all thehighways and byways, as well as side lanes, of con-troverted questions regarding the railroads, many ofwhich are entirely foreign to the points at issue orelse have only a remote bearing upon the same. Theauthor wobbles from one side to the other, dallieswith this question and that, then takes up others,one after another, only in the end to drop them allas wholly beyond him. One may agree entirelywith the declaration that "in the future the publicutilities of the country should not be permitted to'cut melons' from surplus," but what, in all con-science, has this to do with the wage dispute which theCommission was called upon to decide. Why lugit into such a controversy? Why obscure the mainpoint with irrelevant side issues?Comfort is derived from the circumstance that to

have granted the demands of the engineers in fullwould have added $7,172,546 per year to the ex-penses of the roads, whereas under the award nowmade (which provides for a standardization of wagesby making the pay alike on all roads for the same classof service, the standard on the smaller roads beingraised to that of the larger roads), the yearly additionwill reach only $2,000,000 to $3,000,000 per year.The unfortunate feature, however, is that the extraexpense will fall almost entirely upon the weakerroadsthose least able to bear it. The Commis-sion argues that this is of little consequence, sincethe smaller roads are nearly all controlled by thelarger ones, which will hence have to bear the bruntof the increase in the end. We imagine, however,the minority stockholders in these smaller, or sub-sidiary, roads will not view with entire complacencythe further impairment of the net income of theseproperties.There is also very little comfort in the knowledge

that the Commission does not undertake to decidethe question of the ability of the roads to pay increased

wages. As a matter of fact, though the Commissiondoes not venture to express definite conclusions onthis point, it in effect prejudges the question againstthe roads. The writer of the report does not succeedin concealing his leanings. He has been unable toresist the temptation to make up a case against theroads, and hence deftly weaves in statements andobservations that must inevitably convey the impres-sion that the roads are abundantly able to bear theburden of higher wages. Page after page of the reportis filled with figures and statements intended to showthat the railroads up to the present time have faredextraordinarily well and that the managers ought tocongratulate themselves over the prosperity the roadshave been allowed to enjoy. The figures preparedon behalf of the carriers, and which furnish incon-trovertible proof to the contrary, are waived asideas if they were of no account. Instead, the re-port quotes the unconscionably inaccurate state-ments and figures contained in the opinions of theInter-State Commerce Commission when denyingin February 1911 the petition of the roads for author-ity to advance rates. At the time these opinionswere handed down we took up the various tabularpresentations contained in the same and the obser-vations made in connection therewith, and demon-strated that they were one and all either utterlymisleading or positively erroneous.Yet these worthless figures are again made to do

duty in the present wage controversy. The reporteven quotes Commissioner Lane's statement thatin 1910 "the actual amount paid in dividends (byUnited States railroads) had increased to $405,000,-000, or nearly three times the amount paid in 1900."We have shown over and over again in these columns,and other newspapers have also done so, that the1910 figures as here given involve enormous duplica-tions and triplications, since the same dividend oftencounts twice and even three timesthe Pittsburgh &Lake Erie dividend, for instance, counting in thatof the Lake Shore and that of the Lake Shore in turnin the dividend of the New York Central, as also thedividend of the Michigan Central and many others.Yet the Arbitration Board accepts the figures asgospel truth.At least three of the five arbitrators are men sup-

posed to have an intimate knowledge of public ques-tions, and why they should by this report give ap-proval to efforts to revamp the discredited statementsof the Inter-State Commerce Commission passescomprehension. There is much in the report thathas evidently been conceived in a fair spirit, but theblemishes here pointed out impair the value and use-fulness of the whole document. The importance ofcorrect views on the question of the ability of thecarriers to grant increases in wages will appear whenwe say that the request of the engineers for higherpay is simply the first of a series of demands by dif-ferent classes of employees for additions to their com-pensation. From a pecuniary standpoint, the de-mand of the engineers was really the least importantof the whole series. Next Monday the Managers'Committee of the railroads is to have a conferencewith the adjustment committee of the Brotherhood ofFiremen and Enginemen, to deal with a propositionof these latter, made last May, for increases in paywhich, it was estimated at the time, would add, ifgranted, $28,000,000 to the yearly expenses of theroads. Simultaneously, another brotherhoodtheBrotherhood of Railroad Trainmenis now taking a


Nov. 30 1912.] THE CHRONICLE 1433vote of its members to determine if the officials ofthe union shall be authorized to declare a strike iftheir demands for higher pay shall not be acceded to.Evidently this is no time for trifling with the seriousquestion of the ability of the roads to meet thesemultiplying drains upon their revenues.

It is the simple truth to say that the ArbitrationBoard, in this matter of the engineers' wages, hasfailed to deal with the very, crux of the situation.The question upon which the disputants dividedone side affirming a position which the other halfdenied but found more convenient to pass overwas and is one of numbers. It may be concededthat the engineers "ought to" have more pay andthat the roads desire to grant more; the problem isnot one of morals, or of social uplift, or of humani-tarian or economic willingness; the problem is oneof arithmetic. Can the roads pay more wagesor not?Yet these arbitrators say they "were unable to

arrive at a conclusion regarding the ability of theroads to pay an increased compensation;" so theypassed by "the claim of the railroads that they wereunable to bear an increase" - (though prejudgingthe case against them, as already stated), but they"agreed to the principle (never denied by anybody)that the engineers should be paid a fair wage." Itis not a question of fairness, or of deserts, of "should"or "ought"; it is a question of "can." Howevercomplex and difficult, somebody must meet and de-cide that. The roads did not make unspecified andunsupported declarations of their inability to grantwhat they would like to grant; all their figures wereopen and available, and in putting the real questionby, on the non possumus plea, the referees seem tohave yielded, probably unconsciously, to the in-fluence of that old delusion of the senses under whichrailroads are imagined able, because they are phys-ically big, to work what would be miracles for indi-vidual men, and somehow or other get around theprimary arithmetic. There is an ancient fable of aman who lifted his growing calf, every morning; asthe animal increased in girth and weight the manheaved himself a little harder and kept lifting, untilit became an ox. The railroads will manage to doit, somehow (though we are unable to see how),especially if they have to. Is not this a fair para-phrase?But the referees suggest that the roads can ask

leave to raise rates. Suppose the referees had re-plied to the complaining engineers: "We are unableto see how any wage increase, as an arithmeticalmatter, can be brought under present rate schedules,but it is open to you to appeal to the commission andask removal of the obstacle by authorizing an in-crease in rates." Is it not clear that this wouldhave been more logical, less susceptible of confusion,more cogent towards securing such an advance, and(unhappily) better adapted to fit the past attitudeof the Commission upon the subject of rates?

What the Arbitration Board says concerningtransportation and the public is of course unanswer-ably true. It might be put in this form: the rail-roads must be operated, and regularly and efficientlyoperated, in order that the whole community mayexist; therefore, no strikes can be tolerated; there-fore, engineers and other essential employees mustreceive wages sufficient to keep their places volun-

tarily filled. Thus far, with the possible exceptionof the clause regarding strikes, all are agreed, in-cluding labor unions; but there is one more clause,without which all the rest will at last break down-as an operative matter. That final link is this:therefore, the public, to serve whose very life the rail-road must keep going, must supply the funds to pay thewages to hire the men to keep it going. The road diesor goes crippled, if starved, as surely as does a man.The burden cannot be thrown on the financial ownersof the property. The whole public, deriving thebenefit, must divide and contribute the support.No language, no reports, and no evasions or defer-rings can change this arithmetical ultimatum. Con-ceivably, we might try forcibly keeping railroadworkers at work after they once begin; or we mightrush to the phantasm of public ownership; but eitheror both would merely alter the factors without soften-ing the rigor of the case.

Passing on to the public, by increased rates, theburden of what has been aptly called the "spiralstaircase" of the high cost of living, requiring increasedwages and the increased wages producing more in-crease in living cost, and so on, is inevitable, beingforced by irresistible causes. Meanwhile, this ar-bitration award satisfies no party, and is short-livedby its own terms. As for the proposition, offeredtentatively in hope of permanence, that we trygovernmental control of wages in public utilities,this opens widening difficulties to view. Commoncarriers have their practices and charges supervisedand regulated for them already, and the generalpublic placidly approves; when the same method issuggested for application to their employees anotherox will be gored, and will not organized labor dis-cover a last ditch for resistance? Uniformity andstandardizing in wages has a speciously pleasingsound, but even such a suggestion as comes from Pres-ident Harrison of the Monon road, to base the pay-rolls on their ratio to operating revenue in an aver-age term of past years, thereby making wages riseor fall automatically with revenue, is not likely toplease employees, especially unionized employees.It would conform to sound principle in promotinga community of interest and sharing either prosperityor. adversity; but human nature wants what it wantsand when it wants it, and it tries to corral the ad-vantages and leave the disadvantages and difficultiesto the other side.Come back to a dispassionate view which does not

cling to a specific conclusion, and may it not he thatwe have been trying to substitute man-made lawsfor those of the universe? Ownership and controlhaving been naturally joined together, have we notundertaken an unnatural, and therefore an unstableand unworkable, condition in divorcing them andtrying to have one set of persons own property whileanother set holds absolute control over it? Havewe not been unintentionally teaching transportationemployees that if they only act like children and cryloud .and long for what they want, they shall get it(in the name of peace) without regard to anythingelse? Public concern in and some right over trans-portation is conceded; but have we not pushed thattoo far? Legal differences between natural personsand corporations are admitted; but corporations arecomposed of natural persons, and in respect to finan-cial rules and limitations, there is no distinctionwhatever between one natural person and a hundredthousand of them joined under corporate figment.


1434 THE CHRONICLE [VoL. Lxxxxv.

May not the whole trouble be rooted in the errorthat we have been pursuing fundamentally unsoundlines, constantly magnifying regulative control in-stead of keeping it at the minimum?

It is probable that renewed attempts will be madein the coming legislative session at Albany to breakdown by a constitutional amendment the force ofthe decision of the Court of Appeals in the Ives case,a celebrated case, the facts of which, as well as thedecision itself, have been persistently misstated bythe most vociferant peripapetic orator of the times.That some attempts towards what is called automaticcompensation for injuries will be made appears clearlyfrom the conference on the subject by the NationalCivic Federation on Tuesday, of which one journalsays the general opinion favored an amendmentmaking compensation mandatory, compelling em-ployers to pay without regard to fault or lack of fault,and at the same time depriving the hurt employeeof the right to sue for negligence compensation.The labor representatives argued that if the Statetakes away this right of action it should guarantypayment of compensation and this, of course, leadsstraight to some scheme of a State fund.A speaker, who claimed to directly represent the

State Federation of Labor, illustrated organizedlabor's habit of insistence on what it wants and dis-regard of everything else; he demanded such a Statescheme; indulged in the familiar unspecified de-nunciation of insurance companies and affirmed thatthe workingmen in the State do not desire anythingto do with them.Without discussing this phase of the subject now,

we note, with some surprise as well as approval, theheadline of the "Sun's" report of the conference,"Workers ask safety, not compensation." Lookingover the text to find what justifies this, we discoverthat Thomas J. Curtis, head of the New York JointCompensation Board and President of the Tunnel-Workers' Union, used that expression, and said hedoes not believe the workman should be taxed topay for his own accident. He inevitably is thustaxed, under any scheme or absence of scheme, butthat is an aside. Mr. Curtis took the position thatthe workman could not afford to pay, declaring that"we'll be working for nothing when we begin tobe taxed for accidents when we're killing ten menin two weeks." Here he referred to tunneling, andhe made some rather gruesome statements aboutthe lack of competent supervision over the hazardsof blasts and of "the bends" which follow improperexposure to air pressure. "We don't want compen-sation," he said; "we want accident prevention."

These words should be written large and he per-sistently impressed upon all legislative bodies andreformers; they state the fundamental principle whichought to prevail, yet is forgotten and is indirectlyopposed by all schemes that exclude negligence as afactor of responsibility. Insurance of every classought to be conservative, protective, preventive,and should confine itself to indemnifying for in-jurious happenings which cannot be prevented orlonger deferred; only in doing this can its highestfunction be fulfilled. If any scheme of trans-ferring his liability to some other party leads theemployer to think "compensation" cheaper for himthan prevention, he is influenced toward negligentpractice; in just the degree that an automatic "com-pensation" without questions asked is offered the

employee his pecuniary inducement to use care forhimself and his fellow tends to be impaired. This isin human nature and to dispute it or overlook it isa sin against humanity and good policy.The principle that precaution should be taught by

punishing carelessness is recognized somewhat; in afew European cities, man can insure only against fireoriginating outside their own premises and are liablefor consequential losses by one which starts at homethrough any fault of theirs. The principle is sound.Vicarious suffering is an unalterable law of life; yetas we approach, in our mistaken humanitarianism,the condition of offering men liberty to be as carelessor as immoral as they choose, and with the pecuniarypenalty passed along to the whole public, we invitethe neglect and wrongdoing which it ought to beour first study to prevent.

Cotton-manufacturing interests at Fall River areat a loss to understand the agitation of the wage ques-tion that was set on foot last week by labor unionofficials. In the face of the quite generally poorexhibits made by the various corporations at therecently-held annual meetings, the net results of theyear's operations having been in almost all casesvery meagre profits or actual losses, they considerhighly inopportune the starting of a movement thatapparently has for its ultimate object the securingof an increase in wages. Aside from the small profitsbeing realized, additional argument against anyagitation of wage matters is to be found in the uncer-tainty as to what will be the outcome of tariff legisla-tion at the coming session of Congress. With thereduction of the duties on cotton goods, whetheralong the lines of the bill passed by the House Aug. 2last or of some new measure, the manufacturers willhave a more or less difficult problem to solve, anduntil that solution is reached, the wage questionshould be held in abeyance.There are many, it is said, who believe that the

union leaders are either not serious in the wage mat-ter or have become imbued with the socialistic spiritof the Industrial Workers of the World. Referringat quite some length to this present agitation, a newsitem in the "Journal of Commerce and CommercialBulletin" of this city says:

The fact of the matter is that the underlying feel-ing in the textile unions of Fall River, New Bedfordand other centres is not thoroughly understood out-side of the union ranks. What the unions are aim-ing at is not so much a wage advance at this or anyother particular time as it is confidential relationswith the manufacturers, whereby they can be as-sured, by trade facts made clear to them, that themills are distributing to the operatives what the lat-ter consider to be a fair share of what the industryyields."The unions have got to the point where they in-

sist on being shown," said one prominent unionofficial. "They are not going to take as sufficientthe simple statement of one or two mill men that theyare not making a new dollar for an old one. Thatstatement has been made repeatedly in the pastwhen subsequent events have shown that the millscould have well afforded to raise wages. We have of-ficials who can understand what the trade situationis as well as the manufacturers, and if the latter arewilling to go over it frankly with us and show usthat they absolutely cannot afford to raise wages,that will be sufficient. But before we take that tobe the fact, we want something more than a bare as-sertion."


Nov. ?,0 rz I THE CHRONICLE 1435While the foregoing is in better temper than have

been many recent representations of labor's side ofwage controversies, it is to be noted, nevertheless,that the operatives reserve to themselves the judgingof what shall be their "fair share" of what the indus-try yields," and practically accuse the manufacturersof having hoodwinked them in past times. Opinionis expressed that no trouble is likely to develop if itcan be demonstrated to the labor leaders that a wageincrease is out of the question at this time. It isunfortunate, however, to say the least, that an indus-try which has been far from reasonably profitable thelast year or two, and will soon have to face the un-certainties that tariff changes involve, should haveto take up the wage question before that industrycan know how it will be affected by the lowering oftariff imposts against the importation of foreign goods.

The war in Southeastern Europe still seems to beslowly but surely drawing to a close. The negotia-tions that are being held by plenipotentiaries ofTurkey and the allied Balkan States at Baghtche areostensibly for an armistice. But latest dispatchesclearly suggest that, when concluded, it is not likelythat they will be found to cover the question of apermanent peace, which will only require officialratification. This, at any rate, is the desire of theTurkish delegates. In the negotiations Turkey isshowing a distinct firmness that has been undoubt-edly aided by its successful resistance to the approachof the Bulgarian columns along the Chatalja lineof fortifications that defend Constantinople and bythe opportunity that has thus been afforded ofstrongly fortifying the territory between these linesof fortifications and the Turkish capital itself.Active hostilities are in abeyance, however, and anarmistice may, therefore, be regarded as already inexistence. The Turks are demanding that the newfrontier shall be south of a line drawn from KirkKilisseh to a point in the neighborhood of Salonica.This will permit Adrianople, which has not yetfallen, to remain in Turkish territory. There is amovement among the Powers to have Salonica de-clared a free port in the interests of all commercialnations. The Bulgarian delegates are striving fora frontier to take in the line from Mustafa Pachato Dedeagatch, along the river Maritza. This wouldbring the port of Kavala in Bulgarian territory.The point of chief contention appears to be whetherAdrianople shall or shall not be retained by Turkey.The war, so far as the original participants are

concerned, having been virtually terminated, thenext question will be the agreement among the Pow-ers in endorsing the re-distribution of territory thatmay be included in the terms of peace. Servia haspersistently refused to respect the wishes of Austriathat it shall not obtain a seaport on the Adriatic.The distinct issue has now finally been raised betweenthe two countries on this question. On Thursdaythe Servian troops occupied without resistance thePort of Durazzo, which has been the objective pointof the Servian campaign. Austria-Hungary is mak-ing spectacular preparations in the way of mobiliza-tion of its full military forces and its Ministers de-clare they are determined to be fully prepared forany development of whatever character in the Balkancrisis. Advices from Vienna state that the Parlia-mentary leaders at a meeting on Thursday eveningdecided to permit the Premier's three bills dealingwith matters connected with military mobilization

to go to committee without the customary firstreading.

Sir Edward Grey, the British Foreign Secretary,has proposed that a conference of the Ambassadorsof the Six Great Powers be held at Paris or any oneof the Continental capitals with a view of agreementupon concerted action to prevent Europe being in-volved in a conflict over the distribution of the prizesof the Balkan war. Austria-Hungary, without reject-ing the pr nciple of the conference, has expressed anunwillingness to participate until the essential pointsrelating to Servia's demand for a port on the Adriaticare settled. Meanwhile, the Austrian Foreign Officehas received word from Uskub, Albania, announc-ing the safe arrival there on Tuesday of the Aus-trian Consu Prochaska, who had been missing sinceServians captured Prisrend from the Turks, and thereport of whose death or in.;ury promised last week tobe made by Austria the basis of a confi ct with Serv:a.The German Emperor early in the week suggested toAustria that it .was desirable for the latter to submitits differences with Servia to a conference of thePowers. This suggestion was firmly refused. Newscomes by way of Vienna that the Turkish Cabinethas adopted a resolution declaring that "inasmuchas four years' test has proved constitutional govern-ment is neither suitable nor effective in the OttomanEmpire, the Government has decided on the abroga-tion of the constitution," thus ending the regimeof the "Young Turks." Albania has proclaimed itsindependence, and the Powers, according to reportsin diplomatic circles in London, are inclined to recog-nize its independence.

Russia has been actively mobilizing its troops, andAustria refuses to accept the Russian explanationthat the military operations are for internal purposes.The Fourth Russian Duma assembled on Thursdayfor the first session since the election, which beganin September. M. Rodzianko, the Octobrist Deputyof Yekaterinoslav, who was President of the ThirdDuma, was re-elected President by a vote of 251 to159. He was re-elected by the vote of the Consti-tutional Centre with the aid of the Left. In hisaddress of acceptance, he spoke of the public interestsin the Balkans and the necessity of sacrifices inmoney, and, if necessary, men, on the part of Russia.The Fourth Duma declared itself a progressive body,but according to press advices from St. Petersburg,it cannot from that be inferred that a majority of thedelegates will be found to favor the American con-tention in the passport controversy. There are onlythree Jews in the new House, the member from Lodzbeing the only one of these elected by Jewish votes.The Extreme Nationalists are evidently in theminority, but the majority of the members, it wassaid, are not prepared to give American Jews orAmerican goods preferential treatment. If pressdispatches are to be relied upon, the policy of theGovernment will be to render the Russian marketindependent of American cotton and American agri-cultural machinerya policy which, it is supposed,the Duma is fairly certain to support. The Odessacorrespondent of the London "Post" claims to haveinformation that the Russo-American Treaty ofCommerce will be renewed in amended form onJan. 1 next, the United States having waived thepassport question. This report, of course, is obvi-ously incorrect, and it was yesterday officially con-tradicted in Washington.


1436 THE CHRONICLE [VoL. Lxxxxv.The British Parliamentary situation seems to

have improved somewhat during the week, to theextent at least that no additional outbreaks havetaken place. The Unionist defeat of the Govern-ment's financial clauses of the Irish Home Rule bill,with the subsequent developments, has made itimpossible for the Government, even if the Christ-mas recess be shortened, to carry out its programin full. The recent defeat, is is figured, has cost theGovernment a full Parliamentary week. The Gov-ernment's program is to pass the Home Rule, WelshDisestablishment and the Franchise bills under theoperation of the Parliamentary Act within the limitsof the current session, thus enabling the Liberals,ifthey remain in power, to place all three measureson the statute books without regard to any actionof the House of Lords. If the session is finished bythe second or third week in March, so as to enablethe usual appropriation Act at the beginning of anew session to be passed before the close of the finan-cial year on March 31, not a day must be lost. TheGovernment believes that with the drastic useof closure, and if there is no hitch of any kind, theprogram can still be carried out. The Home Rulebill must still have its allotted twenty days and theWelsh Disestablishment bill must have seventeendays. These two measures will use up the time inthe House of Commons well into January. Mean-while the Unionists assert that a bill of such import-ance as the Franchise measure, in view of the im-mense addition it will make to the electorate, mustat least be allotted fifteen days; and all three billsmust be sent to the House of Lords by the second orthird week in February in order to fulfill the require-ments of the Parliamentary Act. There is, however,a disposition to regard the election at Bolton thisweek as a favorable reaction to the Government,since it indicates that Lancashire is strongly opposedto tariff protection

'China is again considering the resumption of boy-cotts which may be regarded a sign that the revo-lution is passing from the public mind. Severalmeetings have been held at Chifu, China, accordingto advices received at St. Petersburg, to organizea boycott of Rusian goods. The Chinese are en-deavoring to collect a war fund amounting to $5,-000,000 and to enlist 2,000 volunteers among theinhabitants. The basis of the antagonism to Russiais evidently the so-called Russo-Mongolian agree-ment, by which Russia recognized the independenceof Northern Mongolia. Sir Edward Grey, BritishForeign Secretary, in the House of Commons onThursday declared that Great Britain was in no wayparty to the agreement just referred to. His state-ment was called forth by an intimation in the formof a question put by Laurence Ginnell, an IrishNationalist, that the mission of J. J. Korostovetz,Foreign Russian Minister at Peking, to Urga,Mongolia, and the treaty with the Khan of Mongoliawere the first fruits of the recent visit to London ofSergius Sazonoff, Russian Foreign Minister.Dr. W. Roest of Batavia, Dutch East Indies, is, ac-

cording to cable dispatches from Peking, to be ap-pointed adviser of the Chinese Government for ther dorm of the currency of the Republic. G. Vissering,who was originally proposed for the position, will beappointed honorary adviser. Mr. Vissering is goingto Amsterdam from Peking as President of the Neth-erlands Bank. A special cablegram from Canton,

China, to the Chicago "Daily News" announces thatthe Chinese Government will seek additional loansin the United States. Under date Nov. 25 the dis-patch says that Professor Yuen Ching of the Provin-cial Higher Normal School, was to leave Hong Kongthe next day for Honolulu, where he will be joined bythe Provisional Treasurer, Liu Ching Soi, and R. 0.Johnson, Superintendent of Public Works. Theywill proceed together to the United States to nego-tiate for further loans. Liu and Johnson have beenin Peking consulting the officials in the Ministry ofFinance. Prof. Yuen represents a private bankingassociation, while Liu and Johnson represent theGovernment. Prof. Yuen is a graduate of the Uni-versity of Chicago. The contract for a $5,000,000American loan finally has been approved in Peking,where the sewerage tax was substituted as security,instead of the land tax as was at first proposed.The representatives of the Canton Government andthe American bankers are now in Peking, but theAmerican agent, M. S. Paget, will soon return tothe United States.

The London Stock Exchange and the Continentalbourses do not appear to have taken a particularlyserious view of the delay in the progress towardspeace between Turkey and the allied Balkan States,or the severe strain, which seemed so close at onetime to the breaking point, in the relations of Austriaand Servia. British Consols closed last evening at75 5-16, which compares with 75 3-16 a week ago, whileFrench Rentes (in Paris) were 89.70 francs, asagainst 89.873/i francs a week ago. The Continentwas a heavy seller of Canadian Pacific on the Londonmarket. The London settlement was concludedwithout difficulty and showed a relatively smallaccount in American shares, for which the carry-overrates were 6@6%, which compares with 6% at themid-month settlement, and also at the settlement amonth ago. There were no American bids at theoffering of Cape gold on Monday. India secured150,000, and the remainder, 850,000, was securedby the Bank of England. On Wednesday, however,200,000 in gold was purchased for New York ac-count and was shipped on the Cedric sailing for NewYork on Thursday. State funds, especially ofcountries directly or remotely connected with thesettlement of the war, continued irregular. Russian4s on the London Stock Exchange, for instance,closed at 90, against 91 on Friday of last week;German Imperial 3s at 7732 showed an advance of Mpoint. Money in London closed at 3%@4%%, com-paring with 33@33'% a week ago.Discount rates at the official European banks were

without change, and private market rates were, as arule, irregular. The Bank of Bengal on Thurs-day advanced its rate from 6% to 7%, and onthe same day the Bank of Bombay's rate was ad-vanced to 6% from 5%. In Lombard Street at theclose yesterday short bills as quoted by cable were47/84 15-16% and long bills were 4 11-16@4%%for both spot and to arrive. A week ago the quota-tions were 47A@4 15-16% for 60-day bankers' ac-ceptances and 4%@,4 13-16% for 90 days spot,with bills to arrive 1-16% below these figures. InParis the open market rate, which was 3%% for bothspot bills and those to arrive last week, was quotedby cable last evening as unchanged for spot and at3Y1@3%% for bills to arrive. In Berlin moneyclosed at 6@7% and the private discount rate was


Nov. 30 1912.] THE CHRONICLE 143759% for spot 60-day bills and 5M(0)6% for 60-daybills to arrive, while 90-day acceptances were 5V%for spot and 5 8% to arrive. A week ago all ma-turities were 5/% for spot and 534% for bills toarrive. Brussels closed unchanged for the weekat 4%@4%%; Amsterdam still remains un-changed at 37A%, and Vienna is also with-out alteration at 5%. The official Bank ratesat the leading foreign centres are: London, 5%;Paris, 4%; Berlin, 6%; Vienna, 6%; Brussels, 5%;Amsterdam, 4%; Bombay, 6%, and Bank of Ben-gal, 7%.The weekly statement of the Bank of England

on Thursday presented a strong showing. It regis-tered an increase of 321,116 in gold and bullionholdings and an improvement of 286,000 in the re-serve which made the proportion to liability 50.81%,comparing with 50.67% a week ago and 51.31%a year ago. The market increased its borrowingat the Bank 90,000, while 704,000 in publicdeposits were released. Other deposits increased1,118,000. The bullion holdings now amount to37,786,270, which compares with 37,465,154 aweek ago and 37,357,243 a year ago. The loans(other securities) aggregate 31,760,000, whichcompares with 31,670,000 one week ago and 28,-911,031 one year ago. Our special correspondentfurnished the following details of the gold movementinto and out of the Bank for the Bank week: Imports,417,000 (of which 24,000 from South America,60,000 from Bucharest and 333,000 bought inthe open market); exports, 50,000 to Antwerp andshipments of 46,000 net to the interior of GreatBritain.

The Bank of France reported on Thursday adecrease of 2,467,000 francs in gold and of 9,942,000francs in silver. There was an increase of 14,-960,000 francs in discounts but a decrease of 18,-225,000 francs in the Bank's advances. Notes incirculation increased 20,625,000 francs, treasurydeposits increased 6,900,000 francs and generaldeposits showed the large expansion of 129,225,000francs. Comparing with the figures of last yearthe gold item showed an increase to 3,220,324,000francs from 3,210,550,000 francs, while silver in-dicates a reduction to 741,335,000 francs from 806,-175,000 francs. Note circulation in the same timeincreased to 5,687,750,000 francs from 5,449,729,810francs and discounts to 1,586,364,000 francs from1,592,785,225 francs. General deposits are largelyahead of last year's figures, amounting to 808,-971,000 francs, comparing with 550,686,362 francsin 1911 and 612,161,747 francs in 1910.

The weekly statement of the Imperial GermanBank issued on Tuesday was favorable in all itsprincipal items. The gold stock registered an in-crease of 12,280,000 marks and gold and silver com-bined an increase of 25,248,000 marks. Meanwhilethere was a curtailment in note circulation of 69,-009,000 marks, of 19,565,000 marks in loans and ofthe large sum of 98,240,000 marks in discounts.Treasury bills showed a reduction from the precedingweek's total of 20,902,000 marks, and deposits werereduced 17,297,000 marks. The Bank, however,is still in a more extended position than a year ago,its cash being but slightly higher, while loans, dis-counts and circulation are much greater. Thus thestock of gold and silver combined is 1,162,898,000

marks. In 1911 it was 1,147,500,000 marks and in1910 1,059,880,000 marks. Loans and discountsnow aggregate 1,365,300,000 marks, against 1,168,-840,000 marks in 1911 and 1,083,120,000 marks in1910. The outstanding circulation is 1,795,730,000marks, comparing with 1,653,700,000 marks at thisdate a year ago and 1,513,500,000 marks in 1910.

The closing week of November has witnessed adistinct flurry in the 'oca" money situation, the ratefor demand loans yesterday (Friday) reaching 20%.No confirmat'on has become avai'able of the reportcurrent a week ago that $1,250,000 in gokl had beenengaged in Germany for sh pment to this country.However, $1,000,000 additiona' to the $1,250,000 ingo d which was engaged in London last week has beenpurchased for New York account and was shippedon the White Star Line steamer Cedric, which sailedon Thursday. New York was not a bidder at theweekly auction of Cape gold in London on Monday.On the other hand, $2,250,000 in gold has left NewYork for Montreal this week. The extent of theflurry will be appreciated when it is stated that aconsiderable part of the call loans on Stock Exchangebusiness on Monday was made at 12%, and that thisfigure was the renewal basis for all outstanding callloans on Tuesday; and after a rather easier tone onWednesday, a 20% rate, as a ready noted, wasreached on Friday. The money situation in New Yorkhas been affected by quite an unusual combinationof influences. In the first place, Canadian bankshave been calling home their funds very freely andthe $2,250,000 in gold shipments already referredto represents but a partial indication of the move-ment to the Dominion. New York exchange inMontreal during the earlier days of the week com-manded a premium of 783/8e. per $1,000, which is anunusually high figure. The recent statement of theCanadian banks shows that there has been a steadydecline the last few months in their bank balancesand call loans held in London and New York. Theirdemand loans held abroad on June 30 amounted to$120,569,812. On Sept. 30 this amount had beenreduced to $112,767,036 and on Oct. 31 to $101,-186,983, representing a contraction of $19,382,829in four months. During the same periodJune 30to Oct. 31the balances carried "in banks else-where than Canada and the United Kingdom"meaning almost exclusively New Yorkshowed areduction of $6,547,847. The high money ratesabroad have not unnaturally retarded the movementof funds from London to Canada, and have caused theDominion banks to call upon New York for probablynot far from $25,000,000, of which less than $7,500,-000 has gone forward in gold, including shipments inJuly and August of about $5,000,000 and the addi-tional $2,250,000 that has gone forward this week.The remainder of the transfer has been accomplishedby means of routine sterling exchange transactionsand of the transfer of funds by New York banks onbehalf of Canadian banks to the accounts of Americanmanufacturers and exporters who have been sendinggoods into Canada. The Canadian banks have beenpurchasing sterling exchange in New York duringthe last few months, paying for the same from theirNew York bank balances.Aside from the Canadian demand New York

banks have this week been compelled to remit largesums to interior institutions. In addition, they havebeen called upon to make preparations for the De-



cember dividend and interest disbursements and havealso been obliged to prepare for the final paymentsof New York City taxes for the second half of the year.as all tax payments must be made before the close ofbusiness at noon to-day, or the owner will incur penaltyin the form of interest charges. There have beenrevivals this week of the report that the TreasuryDepartment was contemplating coming to the reliefof the market with deposits of Government funds atthe national banks of New York and the interior.Secretary MacVeagh has denied, however, that hecontemplates taking such a step. The immediatestrain in the local situation should show some degreeof relaxation as soon as the new month opens. The$1,250,000 in gold that was engaged in London lastweek will be available in bank reserves on Monday,and it is possible that the $1,000,000 in gold that iscoming by the Cedric may reach the banks nextFriday. Meanwhile the December dividend andcoupon money will not unlikely be promptly returnedto circulation under the stimulus of the current highrates, and the stock market seems to have enteredsuch a deep rut of dulness that its demands are notat all probable to become excessive. However, itis certainly not time to expect any return to reallycheap money. Preparations for the new year pay-ments will have to be promptly made, and this alsoinvolves remittances about the middle of Decemberfor the payment of dividends and interest on Ameri-can securities that are specifically payable on Jan. 1in sterling, francs and marks.

Referring to call money rates in detail, the rangeon Monday was 6@12%, with the lower figure therenewal basis; on Tuesday 12% was again the highestand 3% was the lowest, though very little businesswas transacted at this figure, and the ruling ratewas 11%; Wednesday's highest and ruling rate was9%, with 3% again the lowest; Thursday was a holi-day; on Friday the range was 6@20%, with renewalsat 7%. Time money sympathized with the firmnessin demand loans. Closing quotations were 6% for60 days and 90 days, 5%@6% for four and fivemonths and 532% for six months. Mercantile paperis not offered freely and is on a 6% basis for 60 and 90-day endorsed bills receivable and also for choice fourto six months' singe names; names not so well knownstill require 63/2%.

With call money showing such strength at homeand time money also distinctly firmer, it is not sur-prising that sterling exchange should have respondedwith a sharp break. Rates have this week gone toa new low level for the year and engagements havebeen made in London of $1,000,000 in gold for NewYork, the metal being shipped on the White Starsteamer Cedric, which sailed on Thursday. Thenews of the sh pment of $1,000,000 is contained inLondon cable advices; however, only $500,000 seemsto be defin tely acknowledged here. This $500,-000 comes to the Guaranty Trust Co. Amer:canbankers, as already stated, were not bidders atMonday's weekly auction of Cape gold in London.The gold that was engaged was obtained in the openmarket and not from the Bank of England. Londonhas been a buyer this week net in the arbitragedealings in securities between the New York andLondon markets. There seems no present promiseof much easier money in the British centre or, forthat matter, in any of the world's markets for someconsiderable time. Cable advices from London

state that a large mass of underwritings has beenwithheld from that market as a result of the warin Southeastern Europe. This is a feature that hastied up resources which bankers will endeavor torelease by distributing their commitments by formalofferings of securities. In addition, Turkey andall the Balkan States will undoubtedly become urgentborrowers as soon as peace is declared. Italy alreadyis sounding London bankers with a view of raisinga large loan. If, therefore, money is to be held athigh rates abroad, it is quite natural to expect thatcorrespondingly profitable returns on capital mustbe available on this side if we are to draw a consider-able volume of gold to this market. Our bankersare still paying off maturing drafts held abroad, andthe immediate future of the sterling exchange marketwill be governed largely by money rates at home.The supply of commercial bills is large. On theother hand, large remittances will be necessary in thecourse of the next few weeks to pay not only the divi-dends and interest on American securities thatare specifically payable in the foreign markets,but also the large amounts that are payable in NewYork on American securities held abroad, and areremitted when collected. These latter require aconsiderable annual supply of exchange at this centre.Foreign exchange houses here are rather expectinga reduced movement of merchandise imports as thedate approaches for tariff legislation, though thereis no present indication of a reduction in exports.This is a prospect that, of course, is in favor of NewYork.Compared with Friday of last week, sterling ex-

change on Saturday moved up quite sharply onapprehensions of fresh complications abroad and theexpectation of gold imports here; demand advancedto 4 8505@4 8515, cable transfers to 4 8550@4 8560and 60 days to 4 8075@4 8085. There was a breakof about 20 points in rates on Monday, due in partto the rise in call money (which went as high as 12%)and a good supply of commercial bills; the declinewas to 4 8485@4 8495 for demand, 4 8530@4 8540for cable transfers and 4 8060@4 8070 for 60 days.On Tuesday sterling touched the lowest level for theyear, when demand dropped to 4 8455 and cabletransfers to 4 8510 on the continued flurry in callmoney; later there was a partial rally and demandclosed at 4 8465@4 8475, cable transfers to 4 85154 8525 and 60 days to 4 8050@4 8060. The marketruled weak on Wednesday and extremely dull; rateswere practically unchanged from Tuesday's lowfigures at 4 8455@4 8465 for demand, 4 8515@4 8525for cable, transfers and 4 8050@4 8060 for 60 days.Thursday was a holiday. On Friday the market wasnervous and closed without important change.C os'ng quotations were 4 8045@4 8055 for 60 days,4 84550,4 8465 for demand and 4 8515@4 8525 forcable transfers. Commercial on banks closed at4 7854@4 80% and documents for payment at4 7974@4 8034. Cotton for payment ranged from4 80 to 4 803.; grain for payment from 4 803% to 4 81.

The New York Clearing-House banks, in theiroperations with interior banking institutions, havelost $837,000 net in cash as a result of the cur-rency movements for the week ending Nov. 29,Their receipts from the interior have aggregated$9,055,000, while the shipments have reached$9,892,000. Adding the Sub-Treasury operationsand the gold shipments to Canada, which together oc-casioned a loss of $9,100,000, the combined result:


Nov. 30 1912] THE CHRONICLE 1439of the flow of money into and out of the New Yorkbanks for the week appears to have been a loss of$9,937,000, as follows:-

Week ending Nov. 29 1912. IntoBanks.

Out ofBanks.

Na Change inBank Holdings.

Banks' interior movement $9,055,000 $0,892,000 Loss $837,000Sub-Treasury operations 15,300,000 24,400,000 Loss 9,100,000

, Tntstl $24.355.000 $34,292,000 Loss 0,937,000

The following table indicates the amount of bullionin the principal European banks.

Nov. 28 1912.

Siker. I Total. Gold.

Nov. 30 1911.

Sliver. Total.

IEngland__ 37,786,27 I 37,46,270 37,357,243France _ _ 128,812,5601 29,653,120 158,465,680 128,421,640Germany. 41.799,00i 15,400,000 57,199,0001 42,490,6Russia _ 157,518,000 6,459,000 163,977,0001142,072.000Aus.-Hun_ 51,725,00 10,868,000 62,593,000 53,737,000Spain ___ 17,382,000 29,602,0001 46,984,0001 16,702,00Italy _ 42,673,000 3,550,000 46,223,0001 40,702,000Netherl'd 13,872,000 591,200 14,483,2001 11,534,000Nat .Beig_ 7,588,000 3,794,000 11,382,0001 6,680,667

5,583,000 4,734,000Sweden _ 5,583,000Switzerl'd . 7,125,000

7,125,0001 6,466,000Norway_ 2,281,000 2,281,000 2,276,000_

37,357,24332,247,240 160,668,88014,884,650 57,375,2506,044,000148,116,00011,729,000 65,466,00030,308,000, 47,010,0003,579,000 44,281,0001,173,300 12,707,3003,340,333 10,021,000

4,734,000

6,466,000

2,276,000Tot. week. 514,144,8301 99,917,320 614,062,150 493,173,1501103,305,523 596,478,673Prev.week. 513,309.5441 99,932,660 613,242,204 491,164,2481102,586,2171593,750,465

THE ELEMENTS OF OUR INDUSTRIALACTIVITY.

The psychology underlying the present industrialsituation of the United States will no doubt puzzlethe future historian. We see everything in aroseate hue. All through the calendar year tradeactivity has been proceeding on a steadily ascendingscale. Orders in the iron and steel industry havebeen pouring in at such a rate that what is calledthe "leading interest" in the trade, namely theUnited States Steel Corporation, reports 95% ofits capacity employed. Its books are so filled withbusiness that in execution of contracts now on handthe mills and furnaces of the Corporation will be em-ployed for a very large part of 1913. The wonder-ful expansion of the steel industry is neverthelessnot difficult to understand. It is readily explainedby the concurrent presence of several circumstances.For the origin of the revival in the iron trade we

must go back to the great break in prices whichoccurred in the middle of last year. Up to thattime it had been the policy of all the producers notto permit any serious collapse in prices, notwithstand-ing the growing trade reaction which had becomeso evident during the first half of 1911. That thispolicy appealed to the weaker sisters in the tradewill be perfectly plain when it is realized that itmeant the staving off of financial difficulties thatmight result from the dropping of prices below costlevels. The plan had, however, a distinct disad-vantage, as it gave to quoted values an artificial char-acter and served to raise doubts as to whether theseprices could be or would be maintained. The resultwas that intending consumers refrained from makingcontracts to supply their needs. In such a situationtrade reaction became steadily more pronounced.When, however, chiefly out of political considera-

tions, efforts to maintain price stability for theproducts of iron and steel were abandoned andvalues were allowed to take a normal course, eventhough that involved in some instances the acceptanceof figures that did not repay cost, it quickly developedthat the change did not harbor the serious consequen-ces that had been apprehended. Not alone that, butthe drop had offsetting advantages of great import.At the new price levels, confidence at once returned,buying orders were now placed with the utmost free-dom, and depression gave way to steadily widening

activity. From that day on, progress in the ironand steel trade has been uninterrupted. The move-ment was later accelerated by the fact that the rail-roads, which, owing to political repression, have fora number of years suffered great trials, and beenobliged to curtail purchases of equipment and mo-tive power and omit the spending of much money forincreasing their facilities in other directions, nowfound that further delay was out of the question,and the managers accordingly began giving liberalorders. While the railroads were thus undertakingto provide additional equipment and facilities, theagricultural yield, by reason of its bounteous char-acter, came in as an additional stimulating agency.This clinched the need for more rolling stock andequipment, and also furnished assurance of generaltrade activity in which every industry in the land wassure to share.At the bottom, therefore, existing trade revival,

so broadly based, must be regarded as fundamentallysound. Perhaps in the same circumstance is to befound the explanation of the apparently inexplicablephenomenon, that trade in its onward march hasbeen proceeding in entire disregard of certain draw-backs which on past occasions have exerted a de-cided retarding effect. It has been said, with muchtruth, that such is the indifference to unfavorabledevelopments and unfavorable probabilities, that war,politics, the possibilities involved in tariff revisionand the prospects of other disturbing legislationare all alike without influence. So far as sur-face indications go, no one, apparently, is re-straining his operations on account of any of thesethings, though doubtless if we could penetrate theminds of those who direct our great enterprises, itwould be found that these matters are at lengtharousing some thought. As far as the mass of the pub-lic is concerned, we are riding on a wave of optimismand buoyancy, where every one feels entirely satis-fied with prevailing conditions and evil forebodingsare not entertained by any large number of persons.No doubt most men, if they could be induced to

reflect, would admit that the situation embodiesa number of influences which may have importantbearing of an unsettling character upon the nearerand remote future. But when the country is onthe crest of a wave of business activity, it is notthe fashion to peep very deeply into underlyingmovements whose influence for the time being mayremain hidden. We are all being carried along onthe upward tide and no one wants to think of thepossibility of having to turn back. It is at just sucha period, however, that most occasion exists foran inward study of things.One of our readers recalls to our attention an article

on Speculative Optimism, published in these columnsjust about three years ago (Nov. 13 1909) and seesmany points of analogy between the situation thenexisting and that now prevailing. Before the end ofthat year the rise in the stock market had culminated,while the zenith of the trade revival of that periodwas reached not a very long time after. That articlewas written with a view to restraining speculativeoperations that seemed likely to do much harm ifallowed to continue unchecked. There is no suchspeculation at the present time, and that, of course,constitutes an additional element of strength. Thereare, however, other elements in the situation which

I suggest caution on the present occasion as they didthree years ago. In the stock market, while specula.


1440 THE CHRONICLE

tion is absent, prices are substantially higher thanthey were earlier in 1912 or twelve months ago.And it is a suggestion worthy the consideration ofstock market leaders (who are carrying the stocks,the general public having shown no disposition totake the shares off their hands) whether it will notbe well to rest content with the present range of valuesuntil it becomes possible to determine what is likelyto be the effect of some prominent prevailing tend-encies in the economic and industrial world.Taking the industrial and economic situation as a

whole, it may well be doubted whether certain eventsand certain movements, which during the last twelvemonths of industrial recuperation have been treatedas of no account, can be wholly ignored in the future.It is a most remarkable circumstance that a Presi-dential campaign of unusual moment has exertedno retarding effect whatever upon trade, though inthe past it has been an almost invariable rule forbusiness to slacken in Presidential years. Tariffdiscussions and tariff legislation in a session of Con-gress prolonged until unusually late in the yearhave been entirely disregarded, though this may havebeen because it was felt (and was proved true) thatwith the President and the lower branch of Congressat loggerheads there was no chance of the completionof any piece of tariff revision. But now that thePresidential contest has been settled, and it is knownthat there is to be a complete change of governmentand a new political element is to be in absolute con-trol, it would appear to be the height of folly to goahead, with the instinct of a fatalist, and chasedoubts away by pretending to believe that the coun-try is going to come out all right, no matter whathappens, no matter what is done.The Democratic party is pledged to tariff revision

and to many other doctrines by its platform and bythe utterances of the President-elect, and in threemonths more will succeed to the control of thegovernment. In less than five months it will pro-ceed to carry out its legislative program, for Mr.Wilson has already announced that he will call thenew Congress together not later than April 15. It isquite within the bounds of probabilities that the newCongress will legislate wisely, and, in the matterof tariff legislation at least, will move cautiously.But in any event there will be change of some kind,radical or moderate, in a tariff policy under which thecountry has lived for half a century. This change,whatever its nature, will involve a process of re-adjustment, and durng the period of readjustment itwill be more than ordinarily risky to conduct businessin a reckless fashion. Every consideration of pru-dence suggests going slow and proceeding with greatcaution and deliberation. It is quite common tohear it urged by those who advocate the loweringof tariff duties that in this country we are no longerdealing with infant industries, that these industriesare now full grown and hence able to cope withforeign competition of any sort; accordingly, thatthe effect of lowering or eliminating tariff dutieswill be absolutely nil. But it. must not be forgottenthat the single object of tariff legislation is to reduceprices. If that is not the purpose, then it is a fraudand a sham. And if prices are to be reduced, who isto bear the burden of the reductionthe owners ofthe factories or the wage-earners, or both?As regards the ownership of our mills and factories,

there has been much talk about the supposed benefitsconferred by the tariff upon "special interests" and

"privileged classes," and no one has had the courage,even in the party committed to a protective tariff,to rise and deny the allegations. Now, however,that we are face to face with the new tariff policy, itbehooves our legislators to probe carefully into thematter and see if there is any basis of truth in theassertions so freely made in that respect. As far asthe facts are known, or can be ascertained, there seemsto be no good ground for the theory advanced in thatregard. Carnegie's millions testify to the fact thatat one time in the past history of the country profitsin the iron and steel trade were large, if not excessive,the high tariff duties imposed being an importantcontributing element; but even in the steel tradeproducers are now obliged to content themselveswith relatively small margins of profits.In more recent years the real beneficiaries of the

tariff have been the farmers who, through a failureto increase the fertility of the soil, have kept produc-tion unchanged in face of a tremendous growth inpopulation, and thus have been able to bring aboutan advance in the prices of the agricultural products(and in the cost of living) of 50 to 60%. Tariffrevision that would remove the duties from foodstuffswould be entirely justified and could be effectedwithout harm to the farmers, bcause these couldeasily and with little exertion increase their productper acre and thus make up for the loss in price. Butthe tariff revision, of which we hear so much, doesnot concern itself with the agricultural schedule,except that it speaks of abolishing the duty on sugar,the one article of general consumption on which dutiescould justifiably be retained because of the largerevenue derived from the same, the uniform applica-tion of the same, and the fact that the tax imposedthereby on consumers is relatively so slight per headof population. What those arguing in favor of tariffrevision lay much stress on is the need of loweringduties on cottons, on woolens, &c., &c. As to theprofits in cotton manufacturing, we gave somefigures last week which should prove an eye-openerto those who declaim against the large benefitssupposed to be conferred on that trade by the tariff.We showed that, owing to the enactment of the fifty-four-hour law in Massachusetts and the grantingof increased wages, stockholders in the cotton millsat Fall River for the calendar year 1912 would receiveaggregate dividends averaging only 4.07% on theirshares, an average below that of all but four of thepreceding twenty-five years; and even this smallreturn of 4% per annum was possible only in a num-ber of cases by encroaching on surplus. It there-fore seems pertinent to ask again if lower prices bethe aim and object of tariff revision, how the reduc-tion is to be brought aboutby lowering wages orby cutting further into profits already so meagre?It cannot be denied that general tariff revision

could not be undertaken under more favorable aus-pices than those at present existing. In the twoleading manufacturing countries of Europe, namelyGreat Britain and Germany, business activity is aspronounced as it is in this country. Moreover,the level of prices there is high, just as it is in thiscountry. If European manufacturers were encoun-tering business depression and were receiving onlylow prices for their goods, the first effect of the lower-.ing of the tariff wall in the United States might be tocause an influx of foreign goods, the American marketbeing used as a dumping-ground for the surplus ofEurope, with the effect of precipitating an almost


Nov. 30 1912,] THE CHRONICLE 1441immediate decline in American prices. No suchdanger seems likely to confront the country in anytariff revision that may be undertaken in the imme-diate future. As a consequence the disturbanceslikely to result from tariff changes will be reducedto a minimum, especially if the revision is carriedon in a conservative way. That, however, does notalter the fact that, whatever the changes or theirnature, allowance for the same will have to be madein all calculations bearing upon the future. It is alsoto be remembered that all tariff changes will have tobe considered in their relation to the longer future.Duty reductions that might not be at all radicalunder present conditions, when the demand for goodsand wares is urgent in both Europe and the UnitedStates, might assume a wholly different aspect whenthe trade situation was reversed. Therefore, untilthe effects of any new tariff law can be more orless accurately gauged by the test of experience, itwill be the part of prudence for business men togo slow, awaiting the outcome as shown by the actualdevelopments.And as bearing upon the possibilities involved, it is

to be remembered that Europe is just now passingthrough an unusually critical period by reason of thecomplications resultng from the war between theBalkan allies and Turkey. Supposing the war local-ized within its present area, the loss of lives and thewaste of capital incurred, with the demands upon theEuropean money markets for funds to repair thewaste, might easily bring on general business de-pression in Europe. On the other hand, should thearea of conflict be widened and one or more of thelarger European Powers become involved, the result-ing withdrawal of enormous numbers of able-bodiedmen from reproductive enterprises might cause agreatly increased demand upon the manufacturingcapacity of the United States. Here, again, there isgreat uncertainty, and uncertainty always suggestsgoing slow. There are some other influences andconditions which impose caution against overconfi-dence. To these we shall hope to refer anotherweek.

PENSIONS FOR EX-PRESIDENTS.

A question somewhat new for aggressive generaldiscussion was suddenly brought up by Mr. AndrewCarnegie's proposal, on Thursday of last week, tooffer a pension of $25,000 a year to each future ex-President of the United States, and to his widowso long as she should remain unmarried. It wasprescribed in this announcement, which was madeat the second annual meeting of the trustees of theCarnegie Corporation, that the pension should beoffered promptly to an ex

-President without awaitingsolicitation by him, but that it should only be offeredso long as no such pension was provided by the nation.It is not impossible that Mr. Carnegie's offer wassuggested by the semi-humorous speech of PresidentTaft at the Lotus Club, two weeks ago, in which hereferred to the possible expedient of chloroformingour ex

-Presidents, after the fashion supposed to havebeen suggested by Dr. Osler.On the part of the general public, Mr. Carnegie'splan has been received with virtually unanimousdisapproval. The consensus of opinion, promptly

and vigorously expressed, was that it would be in thehighest degree undignified for an ex-President of theUnited States to accept such private bounty, even

when proffered with a view to legitimate public

purposes. Furthermore, there was a plain under-lying sentiment that it would be improper on thepart of Congress to countenance an ex-President inaccepting it. But this second consideration bringsup at once the question whether Congress itselfought not to do something in this same matter, andif so, what it ought to do. It is possible that Mr.Carnegie had in view the stimulating of our nationallegislators to action on the question; otherwise hemust have known the reception which his proposalwould encounter.The plan for pensioning ex-Presidents through -a

general Act of Congress is not new. We believethat a measure to that purpose is even now pendingon the calendar of Congress. As a rule, the pro-posal has taken the shape of assuming that the Presi-dent, as Commander-in-Chief of the Army and Navy,is entitled ipso facto to a pension on the same linesas regular officers of the army. At times anothernotion has come into vogue in Congressional discus-sion, to the effect that ex-Presidents might profitablybe allowed a permanent seat in the United StatesSenate, presumably with a Senatorial salary. Nofavor, so far as we are aware, has ever been shown tothe latter proposition. In the nature of the case,with the Senate distinctly representing the Statesfrom which its members come, and with Senatorialmajorities determined by that fact, a complimentarymembership thus allowed to ex-Presidents couldscarcely involve the right to vote. He might takea hand in Senatorial debate, and on this idea thevague proposal seems somehow to have been founded.We think, however, that Mr. Taft, in the speechalready referred to, disposed of this particular argu-ment in his good-natured remark that he could notsee the necessity for "adding to the discussions inthe Senate the lucubrations of ex-Presidents." "Icannot conceive for any reform in the Senate." tPresident added, "which does not lead to a Emit)of debate."The chief objection to the plan of formally pension-

ing ex-Presidents seems to arise from the old Jeffer-sonian idea that our Executive rulers come from thepeople to their high office and should return againto the people. It is frequently pointed out, when thematter is seriously discussed, that in the past ourPresidents have generally ended their lives, afterretirement from public affairs, in ease and comfort.They have sometimes resumed active business, as inthe case of the law practice of Mr. Harrison, Mr.Cleveland and Mr. Arthur. General Grant madesomething of a fortune for his family through hismemoirs; Mr. Roosevelt is winning a handsomeprivate income through his activities in journalism.Why, therefore, it is intimated, should we disturbthis happy and democratic position of affairs?We cannot say that we have much sympathy

with this argument. In the first place, it will notdo to judge a question of this sort by the most'favored cases. It is the least favorable case inpoint which must be considered in saying what isright and necessary. Otherwise the whole argumentfalls to the ground; for actual need and poverty onthe part of a man who had occupied the Presidencyof the United States would be a disgrace to the na-tion, and a pension granted by special Act, in directacknowledgment of such poverty, would be publicannouncement of his indigence, and therefore a left-handed insult. If it be asked whether such a situa-tion may arise, it is, we believe, a matter of history



That ex-President John Tyler did die in somethinglike want. General Grant's position, after his un-fortunate makeshifts to earn a competency in Wall,Street, will scarcely have been forgotten. Neither ofthese two incidents was creditable to the country,.and neither ought to be possible of repetition.

On general principles, the argument is forciblethat our ex-Presidents are in most cases well on inyears, and, therefore, not suited for engaging againin the struggle to earn a living. The ordinary ageof retirement from that office is the age at whichmost men who have lived a busy and exacting lifewish for the comfort of retirement. Often, as inthe case of President McKinley, the American ChiefExecutive will be a man who has spent his activelife in politics and has saved practically nothing fromhis salary. Mr. McKinley, it will be remembered,had to be helped in a pecuniary way when he ranfor Governor of Ohio in 1894simply because hismeagre private fortune had been swept away in thepanic of the preceding year. It is no final answer tosay that an ex-President may resume his businessor his law practice after four or eight years in theWhite House. The experience of the average manis that connections of that sort are not readily re-sumed after so long an interruption; and even if thiswere not a conclusive argument, an ex-President,especially if a lawyer, would constantly be em-barrassed, through the peculiar delicacy of his posi-tion, from accepting certain kinds of business.The very fact that clients might want to retain anex-President simply in order to bolster up their casewith his official prestige, is something which the na-tion must keep in mind as well as the ex-President.Under the present law the President receives a

salary of $75,000. From this he may possibly savesomething, though the expenses of his office are neces-sarily very.:heavy, and we greatly doubt if the peopleas a whole would approve anything which looked likea policy of personal parsimony and economy. Thecase of an English Prime Minister is very different.It is true that the separate Cabinet offices, one ofwhich the Premier himself always holds, yield only$25,000 apiece to their occupants. We believe,however, that a Premier may hold two of such officessimultaneouslyMr. Gladstone, for instance, if weare not mistaken, occupied at once the positions ofChancellor of the Exchequer and First Lord of theTreasury. But quite aside from this, the positionof things in England is that both the chief of a partyand his principal associates, when they go out ofoffice, expect, in the natural order of events, again tohold the same or similar offices within a relativelyshort space of time, when their party returns topower. Whatever may be said as to the generaltradition regarding a third term for our Presidents,it is plain that our system differs radically from Eng-land's, and that the difference has a decided bearingon the question which we are discussing. In the caseof the President of France, a salary of $120,000 perannum is allowed him, in addition to which he re-ceives $120,000 more for the general expenses of hisoffice. Here, it will be observed, is a plain andobvious provision for the future of the incumbent.But to our mind the final and conclusive consid-

eration is that which affects the dignity of the Re-public. We have no sympathy whatever with suchargumentseven when urged in favor of a pensionfor ex-Presidentsas the plea that it would rarelyin:the past have cost our Treasury more than $100,000

per annum. There is something humiliating evenin the presentation of an argument of the sort. Stillless sympathy do we entertain with such commentsas those which Mr. Roosevelt made this week on theCarnegie proposition, to the effect that pensions forGovernment bureau employees, and old-age pensionsfor citizens in general, should be attended to beforeprovision is made for the Chief Executive. Thisstrikes us not only as a bit of cheap demagogy, but aswholly outside the question, since provision forthose other cases, if they are to stand at all, muststand on their own merits.The real question is whether the United States

shall permit its Chief Executive, after giving to hiscountry years in which the average man of standingand position in private life is amassing a compe-tency to provide for his ease in his subsequent re-tirement, to go empty-handed and unprovided for,out of the public service; that it should, in otherwords, refuse to its highest public servant the recog-nition which it grants as a matter of right to itsarmy officers, and which a well-ordered city bestowseven on its retired policemen. The argument againstsuch a policy is, in our view, overwhelming. If, asis probable enough, Mr. Carnegie's plan turns outto have stirred up a sluggish Congress to action,through stimulus of the public conscience, it willhave performed a public service.

THE CONTRIBUTION OF SOCIALISM."Socialism seems to me like all other interesting and im-

portant thingsdestined to help something else. Christi-anity begins with the poor and division of goodsit becomesthe great bulwark of property and the feudal State. TheCrusades, they set out to recover the tomb of the Lordwhat they did was to increase trade and knowledge. And sowith Socialism. It talks of a new orderwhat it willdo is to help to make the old sound."Mrs. Humphrey Ward.

The characteristic of conservatism is its sobriety.The typical American is a man of sound mind.He is excitable and capable of enthusiasm. Hetakes up fads for a time with interest, but he is verysure not to be permanently carried away by unsoundtheories, however attractive. Socialism is not likelyto flourish long with us. It is an alien product, andit is undergoing changes which already indicateits dissolution. The older Socialism of Marx andLasalle has not only been greatly modified in recenttimes, but new truths which it has had to face andwhich, in one way or another, it has been compelledto take into itself, are, like the strange bug which,burrowing under the bark, is destroying our chestnuttrees, attacking its vitals and fast sapping itsstrength.

It no longer teaches that labor is the sole sourceof property, and it is finding radical difficulty indiscovering any theory of distribution of earningswhich will escape the inevitable development ofCapitalism; while it has awakened to the discoverythat the concentration of all property in the handsofi;the State means the creation of a monopoly moreresistless .:anc:Loppressive than any from which theSocialists now hope to escape. A recent contributorto_an.,English Socialistic journal has declared that"Lifeunder State Socialism would be hell."

Thel;Socialist thinkers have also awakened to thediscovery:that they have no definite scheme by whichproduction under their system of economic adminis-tration could be maintained. A theory of distri-bution, however perfect and benevolent it may ap-ar, is of small value if there be little or nothing


Nov. 30 1912.] THE CHRONICLE 1443

to distribute. When the familiar motives for indi-vidual activity and enterprise are removed, it isinevitable that these sources of wealth will fail. Asa consequence, the leaders of the movement have cometo a practical impasse. They have committed them-selves to a theory which has no practical applicationto any existing or possible constitution of humanaffairs. They find themselves crowded into a newposition in which they would have us believe thatevery man is a creature of his own heredity and sur-roundings, and that, therefore, whatever differencesexist in the individual capacity are due not to any-thing in the man himself but to those things whichhave come to him out of the community as a whole,so that he should demand no larger share of anygiven product than any one else, because equitablyhe deserves no more. He may be more productivethan another, but it is only because he has receivedmore than another, and therefore he is not properlyentitled to any larger share of the product. Thisis a theory which will not only invalidate individualgifts but would destroy individuality itself. It issinking the one in the alla conclusion so absurdas to be everywhere recogniied as futile. Furthermore, Syndicalism, although it is being

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