If Not Silver, What? Part 6

The western mind has long looked upon China as given over to hopeless inertia and stagnation, but China has awakened at last. In one year the importation of illuminating oil rose 50 per cent., of window gla.s.s 58 per cent., of matches 23 per cent., and needles 20 per cent. In six years the tonnage of vessels discharging in Chinese ports rose by one-third. While these lines are going through the press Li Hung Chang is in Europe negotiating for a loan of 400,000,000 francs to be expended in internal improvements, and he gives the weight of his very high authority to the statement that China is no longer opposed to the introduction of railways.

Consul-General Jernigan reports to the Department of State that the prospectus of a new industry is now before the public at his station, Shanghai. It is called the Shanghai Oil Mill Company, and purposes to manufacture oil from cotton seed. It is the logical result of the cotton mills at Shanghai, and the consequent stimulus given to the cultivation of cotton in China. Since 1890 there have been forty-five new manufacturing plants established in Shanghai. They are all in successful operation, especially the cotton factories, in which large capital is invested. He adds:

"The area suitable for cultivation of cotton in China is almost as limitless as the supply of labor, and labor being very cheap, there can be no doubt that China will soon be one of the great cotton-producing countries of the world, and that this product, produced and manufactured in China, will command serious consideration in all calculations with reference to the cotton market. It will not be safe to discount the cotton of China because it now grades low, for it is certain to improve. At present it is estimated there are 3,000,000 tons of cotton seed, equal to 90,000,000 gallons of oil, now yearly lost to commerce which would find a ready market. The company will start with a capital of 250,000 Mexican dollars. One company has already ordered its machinery from the United States."

The population of the Chinese Empire is estimated at 400,000,000, but Li Hung Chang declares, and experienced western observers confirm it, that the country with modern improvements could sustain more than twice its present population in a very high state of comfort.

Of all the popular errors, however, the greatest is that of regarding India as an overpopulated, stagnant, and unprogressive land. Suffice it to say here that the population has trebled under British rule, and that the country is abundantly able to sustain in great comfort twice its present numbers by agriculture alone; that the extension of the railway system has recently been rapid, and along with this has gone on a growth of manufactures that is simply amazing. Only recently Burmah borrowed in London $15,000,000 for railway construction, a sum that was subscribed in that market five times over. In these vast fertile regions, which in comparison with what they are destined to be might be called new and undeveloped, live 290,000,000 of people, who are increasing at the rate of something like 2,000,000 per year. And these are but a few of the facts I might present to show that the early development of the Orient is the great fact America must take into account, and that it is almost a certainty that the world's greatest possible production of gold in the future may be absorbed in the East, leaving the West to struggle with an increasing scarcity. Indeed, Prof. Eduard Suess, the great German authority, after giving reasons for his belief that the larger part of the gold product is used in the arts, and that all of it will soon be, points out that Asia will soon, in all probability, absorb almost the entire silver product, and that we shall then have a "crisis" indeed.

In my travels through India and the Orient generally I took notice of her enormous capacity to export wheat. As a result, I predicted that the export, then but fairly begun, would soon menace our supremacy in the British market. I began at the same time to study the social and industrial condition of Russia, and was soon satisfied that she was in the dawn of a great day. I predicted the eastern extension of her enterprises, and increased political influence, especially with China, and the consequent absorption of western gold and capital generally. It appears from the latest summary of the United States Bureau of Statistics that Russia had, on the first of January, 1892, $324,828,300 in gold in her banks, and on the last of last May $424,193,700. If she carries out her present policy, this is less than half of the amount she will require. On a strictly gold basis we must allow her at least $10 per capita, which would make for the empire $1,200,000,000. But if we greatly reduce the per capita, in view of the undeveloped condition of her subjects, the amount still to be required will be enormous. During the same four years and five months the Bank of France has increased its holdings of gold from $260,888,299 to $391,519,658; the Austrian-Hungarian Bank from $26,634,400 to $133,006,312, and the Bank of England from $109,342,800 to $232,791,709, while the Banks of Germany, Belgium, Spain, Italy, and the Netherlands have also increased their holdings some $30,000,000. Thus we see that in these few years the leading nations have added nearly $500,000,000 to their previous h.o.a.rds of gold, which shows too plainly that they are looking forward to a gold famine. How much more will Asia demand? In my opinion, India, notwithstanding British rule and influence there, has developed less rapidly than China will when she once comes into as intimate contact with western nations as has India, for the rigid system of caste which prevails in India and which does not exist in China has been and will be the cause of greater immobility. It is not possible to say how long it will operate as an impediment to a high industrial development, but from the lessons taught in other countries where race and religion create similar castes, we may believe in its long continuance. I take pleasure at this point in referring to the late able work of Prof.

Charles H. Pierson, of Oxford, who pa.s.sed twenty years in the Orient. In his "National Life and Character" he points out that China in 1844 had doubled her population in eighty years, and there since has been a great increase; that Russia has doubled since 1849, very largely by natural increase, the Russian peasant being the most prolific of human beings; and the Hindoos, who had doubled in eighty years, have recently gained 20,000,000 in ten years.

Professor Pierson also points out the great error of a.s.suming that the black and yellow races will fade away before the white, and shows it to be far more likely that with the increased security afforded by British and Russian rule they will increase so rapidly as to industrially force the white race back to the higher lat.i.tudes of the north temperate zone.

Industrial commonwealths will not dispense with great armies--at least not for a long time--but China has pa.s.sed the militant age, and reached the purely industrial. It may be said that work is a pleasure to the Chinese, as active sports are to Western people. Continuous toil is looked upon as a matter of course. To them it does not seem a hards.h.i.+p that men should work. As a measure of the possibilities of the Orient, consider what has been done in the western world within half a century, where the population is much less than one-half of that of the far East. Over four hundred thousand miles of railroad have been constructed, together with a vast, almost incalculable system of telegraphs, to say nothing of the great cities and common roads, or the enormous ma.s.s of productive machinery, which has even outrun the increase of population.

In round numbers, some forty thousand millions in capital have been absorbed in railroads alone. Add the amount absorbed in telegraphs, telephones, steams.h.i.+ps, and electric plants, and a thousand and one appliances of civilization, and the total is beyond comprehension. And all these things have yet to be created and adopted in the Oriental countries.

How rapidly the development may go on there, and what an enormous ma.s.s of capital will be absorbed, is clearly indicated by what has been done in a very few recent years. And so far we have left Africa entirely out of the account, a country with a vast population and richly dowered with natural resources and with a capacity for rapid development.

Possibly the Orientals will not suddenly become progressive to the degree here antic.i.p.ated, though Russia's eastern march has fairly rivalled our western march; and it must be borne in mind that to develop the appliances of western civilization we had all the experiments to make, all the crude preliminary work to do in creating the system, which the Orient will receive from us in its present perfected form, and be able to go on without any mistakes, and thus enable them to adopt within a very brief time that which we gave the labors of several generations to discover, develop, and apply.

How enormous, then, will be their absorption of western capital and gold.

Is it still maintained that the Orientals lack the capacity for such development? Then look at their achievements in every country to which they have emigrated, and especially in this. Their progress here in the industrial arts, even while they were but a handful, was so rapid that the government was called on to restrict them. Even now the papers contain alarming statements to the effect that j.a.pan is invading our markets with those specialties in the making of which we, but a little while ago, considered ourselves superior to all the rest of the world. And no tariff is high enough to keep them out. It is observed by all travellers in China and other Oriental countries that there exists in as great a degree as in the West a desire for indulgence in those things cla.s.sed as mere luxuries which, in all nations, absorb so great a share of its total wealth. Every one who travels through the eastern countries marvels at the extraordinary richness and delicacy of those things adopted by them for ornamentation, luxury, and convenience. And they are of such a character as, far more than in the western world, involves the consumption of the precious metals. Along with the national desire to adopt that which is useful and ornamental, a highly mimetic nature prompts them to seize upon and adapt with singular readiness that which is brought to their notice as being useful and const.i.tuting a salient feature of western civilization.

To sum it all up, we have in Asia somewhere near 800,000,000 of people, who are certainly increasing by 10,000,000 a year, probably many more, and these people pressed on by Russia on the north and west, by Great Britain and France on the south, as well as by the wonderful energy of the j.a.panese on the east. How much gold will all these people absorb in the future? And it should not be forgotten that not only is the present population to be supplied, but an increase of population is to be allowed for, which at ten dollars per capita would alone absorb the entire annual gold production above the amount used in the arts. If any one thinks this forecast fanciful, I only ask him to consider what has been done in the last thirty years, and then make his estimate. For what the possible absorption of the precious metals by the Asiatic people may be, we need only to refer to what has been done by India. By reason of the development of her industries and resources caused by her intercourse with western nations she has imported in net excess of exports, from the years 1835 to 1893, $750,000,000 of gold and $1,750,000,000 of silver, or about one-seventh of the entire world's output of gold and about one-half of the world's output of silver during that time. Professor Shaw is authority for the statement that her demand for the precious metals is yet unabated and great as ever. When we remember that the average population of India during this time was only about 200,000,000, and that there are about three times as many people yet in Asia who have even greater latent powers to absorb the precious metals, one can form some feeble estimate of what an exhaustive drain upon the gold and silver supply of the world will ensue when these nations awaken and develop their resources and energies through the stimulating influences of western ideas and example.

Having considered the possible momentous absorption of the precious metals by the Asiatics, it may be well to consider what Europe itself is likely soon to do in the same line. England, France, and Germany are the three most substantial and commercial nations of Europe, and their experience may be taken as an index. We find that these three use on an average $16.40 per capita of gold. To give the same to the rest of Europe, including Russia and Turkey, will require, in addition to their present stock, $3,780,000,000 in gold, or nearly as much as the entire world's present stock of gold coin.

If the example of France and the Netherlands--two of the soundest and most conservative nations in the world--be similarly taken as an index to the probable use of silver, it appears that these two nations average $12.50 per capita. To supply the rest of Europe to the same extent will require an addition of $3,563,000,000 to her present stock of silver, or about three-fourths as much as the present coined silver of the world. In view of these facts, is not the real question, not whether there is gold enough, but whether there is both gold and silver enough for the future monetary requirements of the world? Does it not seem that the nations are soon to be confronted with this dilemma: that the product of the precious metals must be greatly increased--and is that possible?--or that for the want of gold and silver there must be a serious check to the progress of civilization?