GREAT INCREASE OF TRADE UNDER THE TREATY,

The Cuban reciprocity treaty has been in operation practically since January 1, 1904, and the official figures of the commerce and trade between the two countries this year thus far prove very satisfactory to the friends of the reciprocity proposition and to those who argued and prophesied that the results of the new arrangement would be of much benefit to the people of both communities and would injure no industry in either country. According to statistics compiled by the Department of Commerce and Labor through its Bureau of Statistics the United States exports to Cuba during the first three months of this year amounted in value to $6,495,149, as against $5,211,063 during the first three months of 1903. This is an increase of nearly 25 per cent. The percentage of increase of the imports into the United States from Cuba for the same period is still greater, amounting to nearly 100 per cent, and the increase in the whole trade amounts to more than 70 per cent. The figures show, moreover, that while there has been a gradual increase in our trade with Cuba during the whole of the fiscal year ending June 30, 1904, as compared with the previous fiscal year, the increase was far greater during the last half of the year (the reciprocity period) than during the first half.

The bulk of the United States imports from Cuba during the first three months of 1904 consisted of sugar. The very large total of imports for the period ($23,217,180, as compared with $11,948,597 for the first three months of 1903) was caused, to a great extent, of course, by the action of the Cuban sugar exporters in holding back shipments during the latter part of 1903 so as to take advantage of the expected tariff reductions offered by the reciprocity treaty. It is noteworthy that the recent very large imports of cane sugar have not had a tendency to lower the price of sugar in this country, so that our beetsugar interests have not suffered, while the Cuban producers have reaped a great benefit from the reduction of our tariff rate on their sugar. (The question of the effect on our beetsugar industry of this and other reductions is discussed on another page. See index.)

The 25 per cent. increase in our exports to Cuba during the first three months of 1904, as compared with the first three months of 1903, applied principally to agricultural implements, wheat flour, cotton cloths, sewing machines, leather, naval stores, oils, lumber, and furniture. In some of these articles the recent increase of our exports to Cuba has been 50 per cent, and in some even 100 per cent, as compared with corresponding periods of 1903. The treaty is published in full in the document "Pages from the Congressional Record."

The mints will not furnish the farmer with more consumers. The only market that he can rely upon every day of the year is the American market.-Maj. McKinley to Indiana delegation, at Canton, September 29, 1896.

We believe in reciprocity with foreign nations on the terms outlined in President McKinley's last speech, which urged the extension of our foreign markets by reciprocal agreements whenever they could be made without injury to American industry and labor. -President Roosevelt's speech accepting 1904 nomination,

We each and all owe a duty to the community and to the State. It is a positive duty, and that is to aid in securing good laws and their faithful enforcement. We are not menaced by foreign foes. We have no fear of alien attack. We have nothing within to dread except the indifference of the intelligent citizen to the discharge of his civic obligations.-Hon. C. W. Fairbanks, at Freehold, N. J., June 27, 1903.

I am a protectionist because I can see very clearly that the political independence which every patriot would sacrifice his life to preserve to his country can only be safely assured when we are industrially independent, and I am glad, if it requires that lesser sacrifice, to forego a few pennies of my savings to do my part to secure that assurance.-Prof. R. H. Thurston, of Cornell University, in the American Economist.

G

THE PACIFIC.

The Republican Policy of Development of its Commerce.

One distinctive feature of the Republican policy in recent years has been the enlargement of our trade with the Orient and a strengthening of our relations with the Pacific. This policy

was clearly developed during the administration of President Harrison, who in his speeches on the Pacific coast, in his urgency for the construction of an isthmian canal, and in his favorable action on the application of the Hawaiian Islands for annexation to the United States, indicated a desire for the development of our Pacific and Oriental trade.

The contrast between Republican and Democratic policies with reference to the Pacific is shown in the fact that the treaty of annexation of the Hawaiian Islands which President Harrison had sent to Congress during the closing period of his administration was immediately withdrawn by President Cleveland and an order given to haul down the American flag which had been hoisted in those islands. A still further evidence of the contrast between the policies of the two parties is found in the fact that immediately upon the inauguration of President McKinley the application of Hawaii for admission to the Union was renewed, favorable action recommended by President McKinley, and an act admitting Hawaii passed a Republican Congress.

It was also under President McKinley that the island of Tutuila, a part of the Samoan group, in which is located the most valuable harbor in the entire South Pacific, was annexed to the United States.

President McKinley also recommended the construction of a Pacific cable, and a Republican Congress subsequently enacted a law under which a cable was constructed across the Pacific by private enterprise, but assuring a marked reduction in rates, and a Republican President, Roosevelt, inaugurated it for business with his opening message to the Philippines, sent thither and around the world on July 4, 1903.

COMMERCIAL PROGRESS IN THE EAST.

The various steps taken in behalf of improved commercial relations with the Orient and especially with China are detailed in the chapter discussing the work of the State Department. These include the insistence upon the "open door" for trade, the negotiation of a new commercial treaty with China, the establishment of new treaty ports in China and Japan, the active work of our consuls in those countries in behalf of commerce, and in addition to these the annexation of the Philippine Islands, an important strategic point commercially as well as otherwise in the Orient. Regarding this important step and its relation to our commerce in the Orient, Archibald Colquhoun, that distinguished British student and traveler, whose writings on trade conditions in the Orient mark him as an authority, says in his "Mastery of the Pacific:" "The presence of America in the Philippines opens a grave possibility, since it is obvious that Hongkong will in the future be out of the direct trade routes between Australasia and the Malay Archipelago and the great markets of America. * * * There are evident signs that the United States mean to make an important center of the capital of the Philippines. Among the most significant factors in the Pacific situation is the advent of Russia coming overland to the Pacific littoral and the sudden appearance of the United States coming over-sea and establishing herself in a large, populous and important archipelago on our borders of Asia. * * * The United States, in the opinion of the writer, will be the dominant factor in the mastery of the Pacific. She has all the advantages, qualifications, and some of the ambitions necessary for the role, and her unrivaled resources and vast, increasing population provide the material for future greatness."

The last step in the work in behalf of the development of American commerce on the Pacific and with the Orient is found in the developments of the past year with reference to the Panama Canal, fully discussed elsewhere, which have resulted in the absolute ownership by the United States of that canal cession and the perpetual control of strip of land five miles wide on each side of the canal route, an area nearly one-half that of the State of Rhode Island, and giving assurance of the right to construct and operate that canal. All of this work with reference to the Panama Canal, as well as all the other work above outlined with reference to the Pacific, has been accomplished under Republican Presidents and in the face of continuous criticism and opposition by the Democratic party in and out of Congress. Not a single one of the measures and steps above outlined has escaped criticism and opposition by that party.

IMPORTANCE OF THE COMMERCE OF THE ORIENT.

That the commerce of the Orient is of sufficient value to justify the efforts which have been made to obtain our proper share in it is evidenced not alone by the continuous efforts which the European nations are making for its control, but by the fact that the annual importations of the semicircle of countries of which Manila forms a central point aggregate about 1,250 million dollars, or an average of 100 million dollars per month, a sum nearly equal to the total value of our present domestic exports. That the United States has made a marked gain in the share which products from the United States form in the total imports of the countries in question-Japan, China, India, Ceylon, Dutch and French East Indies, Australasia, the Hawaiian Islands, etc.-is shown by the fact that such shipments from the United States to Asia and Oceania amounted in 1896 to but about 6 per cent. of the total imports of those countries, while to-day they amount to about 10 per cent of their imports. A table on page ... shows the growth in exports of the United States to each of the grand divisions of the world in each year from 1896 to 1903. It will be seen that while our exports to South America increased only 10.6 per cent., those to Europe 52.9 per cent. and those to North America 84.8 per cent., those to Asia and Oceania, including shipments from the United States to the Hawaiian Islands, increased 149 per cent. The increase in total exports to all parts of the world during the period from 1896 to 1903 was, in round terms, 61 per cent., while that in exports to Asia and Oceania, as above indicated, was 149 per cent., the percentage of increase to Asia and Oceania therefore being more than twice as great as the increase in total exports, and greater than to any other section of the world except Africa, while the actual increase was far greater than that in exports to Africa or South America. To Asia and Oceania the actual increase in the seven years from 1896 to 1903 was practically 64 million dollars, while in the seven years immediately preceding 1896 the increase in exports to Asia and Oceania had been but eight million dollars. Our total exports to Asia and Oceania in 1889 were $34,679,029, and in 1896 $42,827,258, an increase of $8,148,229 during a seven-year period in most of which a Democratic administration was discouraging commerce with the Pacific countries through its attitude regarding Hawaii and other questions of that character. In the seven years following 1896, however, under the encouragement of Republican Presidents, the increase in our shipments to Asia and Oceania was from $42,827,258 in 1896 to $106,770,591 in 1903, a gain of $63,918,333, or nearly eight times as much as in the seven years from 1889 to 1896. Shipments of merchandise from the United States to Hawaii, which have not been included in the official statements of our exports to foreign countries since their annexation in 1900, are included in the above statements of exports to Asia and Oceania in order to furnish a proper basis of comparison of growth in that commerce, in view of the fact that they were so included in 1900.

A very large proportion of the commerce of the islands and Alaska is with the United States. The total merchandise entering Porto Rico from all countries, including the United States, in the year ending December 31, 1903, was $13,939,218, of which $11,

819,695 was from the United States. The total merchandise sent out of Porto Rico in the year ending December 31, 1903, was $14,548,765, of which $10,152,923 went to the United States. The total merchandise entering the Hawaiian Islands in the 12 months ending June 30, 1903, was $13,982,485, of which $10,840,472 was from the United States. The total value of merchandise leaving the Hawaiian Islands in the same period was $26,274,938, of which $26,242,869 was sent to the United States.

In the case of the Philippine Islands the proportion of imports drawn from the United States is naturally much smaller, owing to the fact that much of the materials which they require are drawn from contiguous countries-China, the British East Indies, the French East Indies, and Hongkong-and that much of their former trade with the United Kingdom, Spain, Germany, and France is still retained by those countries in the absence of any reduction on imports from the United States, which cannot be made, as above explained, during the ten years covered by the agreement with Spain bearing upon this subject.

With reference to the commerce of Alaska, it may be said that practically all of it is with the United States. The commerce of Guam, which was taken possession of during the war with Spain, is small and practically all of it with the United States. That of the island of Tutuila, one of the Samoan Islands which was annexed at the termination of the protectorate which the United States in conjunction with the United Kingdom and Germany exercised over the Samoan Islands, is small, but chiefly with the United States. The importance of this island lies not in its commerce, but in the splendid harbor which its possession gives to the United States, being by far the best harbor in the South Pacific. This, with the control of the harbors in the Hawaiian and Philippine Islands, gives the United States the control of the best and chief island harbors of the Pacific Ocean.

COMMERCIAL RELATIONS WITH OUR ISLAND POSSESSIONS.

The class of articles forming the commerce between the United States and its island possessions are, in the case of merchandise coming from those islands, almost exclusively tropical products. Of the merchandise received from Porto Rico in the calendar year 1903, amounting in value to $10,152,923, sugar amounted to $6,813,854; cigars, $1,441,196; coffee, $610,982, and fruits, $378,210. The domestic merchandise shipped from the United States to Porto Rico during the same period, amounting to $11,424,313, included practically all classes of goods; breadstuffs, $1,199,052; cotton manufactures, $1,950,803; iron and steel / manufactures, $1,156,273; provisions, $1,403,634, and rice, $2,213,031. Of the merchandise received in the United States from the Hawaiian Islands during the year ending June 30, 1903, amounting to $26,242,869, $25,310,684 was sugar. The domestic merchandise sent from the United States to the Hawaiian Islands in the same period, amounting to $10,787,666, included practically all classes of articles; breadstuffs, $1,466,571; cotton manufactures, $1,022,116; iron and steel manufactures, $1,149,505; manufactures of wood, $815,290; mineral oils, $580,823; provisions, $579,334, and fertilizers, $495,724. The merchandise received in the United States from the Philippine Islands in the year ending June 30, 1903, amounting to $11,372,584, consisted chiefly of manila hemp, $10,931,186, and sugar, $270,729. Of the shipments to the Philippine Islands from the United States in the same year, amounting to $4,028,677, manufactures of iron and steel formed the largest single item, $657,354; wood and its manufactures, $499,563; cotton manufactures, $316,570; breadstuffs, $278,891; malt liquors, $310,495; spirits, $124,875, and wines, $8,397.

TROPICAL PRODUCTS IN GREAT DEMAND.

It will be noted that tropical products form the bulk of the merchandise received into the United States from its tropical possessions. This is an important feature of the contributions of those islands to the United States and suggestive of their power to supply the tropical requirements of this country. The total value of tropical and subtropical products brought into the United States from various parts of the world now averages more than 400 million dollars per annum. The total value of

tropical and subtropical products brought into the United States during the fiscal year 1903 from foreign countries amounted to 372 million dollars, and to this was added over 25 millions from the Hawaiian Islands and 11 millions from Porto Rico, thus making the grand total of tropical and subtropical products brought into the United States during that year over 400 million dollars. Of this grand total of over 400 million dollars, sugar formed 100 millions; coffee, 60 millions; silk, 50 millions; fibers, 31 millions; India rubber, 30 millions; fruits and nuts, 23 millions; tobacco, 20 millions; cotton, vegetable oils, and gums, 11 millions each, and cocoa and chocolate, 8 millions. The fact that practically all of these articles can be produced in the islands in question and that large cultivable areas still exist in the Philippines which may be utilized in supplying this enormous demand of the United States for tropical products suggests that they may become extremely valuable in supplying our rapidly growing requirements for tropical products. The value of tropical products brought into the United States has increased from 141 million dollars in 1870 to over 400 millions at the present time, and is still growing. Our experience with the Hawaiian Islands shows that following a reduction of tariff rates on merchandise passing between those islands and the United States, they increased their purchases of our products at about the same rate that we increased our purchases from them. Should this follow in the case of the Philippine Islands, and should those islands prove capable of supplying a large part of the 400 million dollars' worth of tropical products which we now purchase in foreign countries, they would in turn supply to our producers and manufacturers very large markets for our products, just as Porto Rico and Hawaii have done following the increase in our purchases from those islands. Tables showing the shipments of merchandise from these islands into the United States and from the United States into these islands during a term of years are shown elsewhere, also a table showing the imports into the United States of tropical productions during a term of years, and the principal articles included therein.

Another advantage in the new relations of the United States to these islands is developed in the large investments which are already being made in those islands by citizens of the United States and the benefits resulting both to the islands, to the investors themselves, and to the people of the United States whose sales to the islands are stimulated by the development caused by such investments. In the case of the Hawaiian Islands the total amount of American capital there invested at the present time is about 100 million dollars. This statement is based upon figures supplied to the Bureau of Statistics from a reliable authority in those islands. In the case of Porto Rico about 10 millions of American capital has been there invested up to this time. In the case of the Philippines, the investments up to the present time amount to several millions, and it is expected will rapidly increase now that order and stability are assured.

Details of conditions in those islands and of the benefit which government by the United States has been to their people are discussed elsewhere in the chapters especially devoted to those islands. The above discussion is intended to relate only to the commercial aspect of the control of the islands and their relation to our commerce.

The Pacific Cable.

The credit of rendering practicable the construction of a Pacific cable is due to the policy of the Republican party. As already pointed out in the discussion of conditions in the Orient and the Pacific, the policy of the Democratic party has been constantly averse to the development of trade with the Orient and to the control of islands in the Pacific. True, President Pierce and his Secretary of State did attempt to annex the Hawaiian Islands, but a later Democratic President, Grover Cleveland, not only opposed annexation, but prevented it during his administration, in spite of the fact that the people of the islands were anxious for such relationship. So long as the islands which are now utilized for the landing places of the cable were controlled by various nations with varied interests, nobody was willing to construct a trans-Pacific cable. Cables can only be worked over the compara