The American Empire Part 21

The wheat crop of the world in 1916 was 3,701.3 million bushels. Russia, including Siberia, was the leading producer with 686.3 million bushels.

The United States was second with 636.7 million bushels or 17 per cent of the world's output. British India, the third wheat producer, had a crop in 1916 of 323.0 million bushels. Canada, with 262.8 million bushels, was fourth on the list. Thus Canada and the United States combined produced almost exactly one-fourth of the world's wheat crop.

As a producer of corn the United States is without a peer. The world's corn crop in 1916 was 3,642.1 million bushels. Two-thirds of this crop (2,566.9 million bushels) was produced in the United States.

The position of the United States as a producer of corn is almost duplicated in the case of cotton. The _Statistical Abstract_ published by the British Government (No. 39, London, 1914, p. 522) gives the world's cotton production as 21,659,000 bales (1912). Of this number the United States produced 14,313,000--almost exactly two-thirds. British India, which ranks second, reported a production of 3,203,000 bales.

Egypt was third with 1,471,000 bales.

About one-tenth of the world's output of wool is produced in the United States. World production for 1917 is placed at 2,790,000 pounds.

(_Bulletin_, National a.s.sociation of Wool Manufacturers. 1918, p. 162.) Australia heads the list with a production of 741.8 million pounds.

Russia, including Siberia, comes second with 380.0 million pounds. The United States is third with 285.6 million pounds and Argentina fourth with 258.3 million pounds.

The United States leads the world in timber production. "Last winter we estimated that the United States has been cutting about 50 per cent of the total world's supply of lumber." (Letter from Chief of Forest Investigation. U. S. Forest Service. Oct. 11, 1919.) The same letter gives the present annual timber cut. The United States 12.5 billion cubic feet; Russia 7.1 billion cubic feet; Canada 3.0 billion cubic feet; Austria-Hungary 2.7 billion cubic feet.

A third of the iron ore produced in the world in 1912 came from the United States. The world's production in that year was 154.0 million tons (_British Statistical Abstract_, No. 39, p. 492). The United States produced 56.1 million tons or 36 per cent of the whole; Germany produced 32.7 million tons; France 19.2 million tons; the United Kingdom 14.0 million tons. No other country is reported as producing as much as ten million tons.

The position of the United States as a producer of iron and steel was greatly enhanced by the war. _The Daily Consular and Trade Reports_ (July 9, 1919, p. 155) give a comparison between the world's steel and iron output in 1914 and 1918. In 1914 the United States produced 23.3 million tons of pig iron; Germany produced 14.4 million tons; the United Kingdom 8.9 million tons, and France 5.2 million tons. The United States was thus producing 45 per cent of the pig iron turned out in these four countries. For 1918 the pig iron production of the United States was 39.1 million tons. That of the other three countries was 22.0 million tons. In that year the United States produced 64 per cent of the pig iron product of these four countries. An equally great lead is shown in the case of steel production. In 1914 the United States produced 23.5 million tons of steel. Germany, the United Kingdom and France produced 27.6 million tons. By 1918 the production of the United States had nearly doubled (45.1 million tons).

The total pig iron output of the world for 1917 was placed at 66.9 millions of tons. The world's production of steel in 1916 was placed at 83 million tons. The United States produced considerably more than half of both commodities. ("The Mineral Industry During 1918." New York, McGraw Hill Book Co., 1919, pp. 379-80).

The two chief forms of power upon which modern industry depends are petroleum and coal. The United States is the largest producer of both of these commodities. The world's production of petroleum in 1917 was 506.7 million barrels (_Mineral Resources_, 1917, Part II, p. 867). Of this amount the United States produced 335.3 million barrels or 66 per cent of the total. The second largest producer, Russia, and the third, Mexico, are credited with 69 million barrels and 55.3 million barrels respectively.

As a coal producer the United States stands far ahead of all other nations. The United States Geological Survey (_Special Report_, No. 118) placed the total coal production of the world in 1913 at 1,478 million tons. Of this amount 569.9 million tons (38.5 per cent) were produced in the United States. The production for Great Britain was 321.7 million tons; for Germany 305.7 million tons; for Austria-Hungary 60.6 million tons. No other country reported a production of as much as fifty million tons. In 1915 the United States produced 40.5 per cent of the world's coal; in 1917 44.2 per cent; in 1918 46.2 per cent.

Copper has become one of the world's chief metals. Two-thirds of all the copper is produced in the United States. Copper production in 1916 totaled 3,107 million pounds (_Mineral Resources in the United States_, 1916, part I, p. 625). The production for the United States was 1,927.9 million pounds (62 per cent of the whole). The second largest producer, j.a.pan, turned out 179.2 million pounds.

The precious metals, gold and silver, are largely produced in the United States. The world's gold production for 1917 was 423.6 million dollars (_Mineral Resources_, 1917, p. 613). Africa produced half of this amount (214.6 million dollars). The United States was second with a production of 83.8 million dollars (20 per cent of the whole). The same publication (p. 615) gives the world's silver production in 1917 as 164 million ounces. 77.1 million ounces (43 per cent) were produced in the United States. The second largest producer was Mexico, 31.2 million ounces; and the third Canada, with 22.3 million ounces. These three North American countries produced 76 per cent of the world's output of silver.

Judge Gary, speaking at the Annual Meeting of the Iron and Steel Inst.i.tute (1920) put the situation in this summary form:--

As frequently stated, notwithstanding the United States has only 6% of the world's population and 7% of the world's land, yet we produce:

20% of the world's supply of gold, 25% of the world's supply of wheat, 40% of the world's supply of iron and steel, 40% of the world's supply of lead, 40% of the world's supply of silver, 50% of the world's supply of zinc, 52% of the world's supply of coal, 60% of the world's supply of aluminum, 60% of the world's supply of copper, 60% of the world's supply of cotton, 66% of the world's supply of oil, 75% of the world's supply of corn, 85% of the world's supply of automobiles.

With the exception of rubber, practically all of the essential raw materials and food products upon which modern industrial society depends are produced largely in the United States. With less than a sixteenth of the world's population, the United States produced from a fifth to two-thirds of most of the world's essential products.

5. _s.h.i.+pping_

The rapid increase in the foreign trade of the United States created a demand for American s.h.i.+pping facilities. Before the Civil War the United States held a place as a maritime nation. Between the Civil War and the war with Spain the energies of the American people were devoted to internal improvement. With the advent of expansion that followed the Spanish-American War, came an insistent demand that the United States develop a merchant marine adequate to carry its own foreign trade.

The United States Commissioner of Navigation in his report for 1917 (p.

78) gives the net gross tonnage of steam and sailing vessels in 1914 as 45 million tons in all. The tonnage of Great Britain was 19.8 million tons; of Germany 4.9 million tons; of the United States 3.5 million tons; of Norway 2.4 million tons; of France 2.2 million tons; of j.a.pan 1.7 million tons, and of Italy 1.6 million tons.

The war brought about great changes in the distribution of the world's s.h.i.+pping. Germany was practically eliminated as a s.h.i.+pping nation. The necessity of recouping the submarine losses, and of transporting troops and supplies led the United States to adopt a s.h.i.+p-building program that made her the second maritime country of the world. Lloyd's Register of s.h.i.+pping gives the steam tonnage of the United Kingdom as 18,111,000 gross tons in June, 1920. For the same month the tonnage of the United States is given as 12,406,000 gross tons. j.a.pan comes next with a tonnage of 2,996,000 gross tons. According to the same authority the United Kingdom had 41.6 per cent of the world's tonnage in 1914 and 33.6 per cent in 1920; while the United States had 4.7 per cent of the world's tonnage in 1914 and 24 per cent in 1920.

6. _Wealth and Income_

The economic advantages of the United States enumerated in this chapter inevitably are reflected in the figures of national wealth and national income. While these figures are estimates rather than conclusive statements they are, nevertheless, indicative of a general situation.

During the war a number of attempts were made to approximate the pre-war wealth and income of the leading nations. Perhaps the most ambitious of these efforts was contained in a paper on "Wealth and Income of the Chief Powers" read before the Royal Statistical Society. (See _The London Economist_, May 24, 1919, pp. 958-9.) This and other estimates were compiled by L. R. Gottlieb and printed in the _Quarterly Journal of Economics_ for Nov. 1919. Mr. Gottlieb estimates the pre-war national wealth of Great Britain, France, Italy, j.a.pan, Russia, Belgium, Germany, Austria-Hungary, Turkey and Bulgaria at 366,100 million dollars. At the same time the wealth of the United States was estimated at 204,400 million dollars. Thus the wealth of the United States was equal to about 36 per cent of the total wealth of the great nations in question.

The same article contains an estimate of pre-war national incomes for these great powers. The total is placed at 81,100 million dollars. The income for the United States is placed at 35,300 million dollars, or more than 43 per cent of the total.

The war has made important changes in the wealth and income of the princ.i.p.al powers. The wealth and income of Europe have been reduced, while the wealth and income of the United States have been greatly increased. This increase is rendered doubly emphatic by the demoralization in foreign exchange which gives the American dollar a position of unique authority in the financial world.

The latest wealth estimates (_Commerce and Finance_, May 26, and July 28, 1920) in terms of dollars at their purchasing-power value, makes the wealth of the whole British Empire 230 billions of dollars; of France, 100 billions; of Russia, 60 billions; of Italy, 40 billions; of j.a.pan, 40 billions; of Germany, 20 billions, and of the United States, 500 billions. These figures are subject to alteration with the alteration of the exchange rates, but they indicate the immense advantage that is possessed by the business men of the United States over the business men of any or of all of the other nations of the world.

Before the war, the British were the chief lenders in the international field. In 1913 Great Britain had about 20 billions of dollars of foreign investments, as compared with 9 billions for France and about 6 billions for Germany. At the end of 1920, the British foreign investments had shrunk to a fraction of their former amount, while the United States, from the position of a debtor nation, had become the leading investing nation of the world, with over 9 billions of dollars loaned to the Allied governments; with notice loans estimated at over 10 billions; with foreign investments of 8 billions, and goods on consignment to the extent of 2 billions.

The United States therefore began the year 1921 with a greater financial lead, by several times over, than that which she held before the war, when she was credited with a greater wealth and a larger income than that of any other nation in the world. The extent of the advantage enjoyed by the United States at the end of 1920 cannot be stated with any final accuracy, but its proportions are staggering.

7. _The Economic Position of the United States_

Economically the United States is a world power. She occupies one of the three great geographical areas in the temperate zone. If she were to include Canada, Mexico and Central America--the territory north of the Ca.n.a.l Zone--she would have the greatest unified body of economic advantage anywhere in the world.

The United States is rich in practically all of the important industrial resources. She has a large, relatively h.o.m.ogeneous population, a great part of which is directly descended from the conquering races of the world. Almost all of the essential raw materials are produced in the United States, and in relatively large quant.i.ties. The period since the Spanish War has witnessed a rapid increase in wealth production. The war of 1914 resulted in an even greater increase in s.h.i.+pping. The investable surplus is greater in the United States than in any other nation, and in amount as well as in percent the national debt is less than that in any other important nation except j.a.pan. Economically the position of the United States is unique. The masters of her industries hold a position of great advantage in the capitalist world.

XIV. THE PARt.i.tION OF THE EARTH

1. _Economic Power and Political Authority_

Economically the United States is a world power. Her world position in politics follows as a matter of course.

While the American people were busy with internal development, they played an unimportant part in world affairs. They were not competing for world trade, because they had relatively little to export; they were not building a merchant marine because of the smallness of their trading activities; they were not engaged in the scramble after undeveloped countries because, with an undeveloped country of their own, calling continually for enlarged investments, they had little surplus capital to employ in foreign enterprises.

This economic isolation of the United States was reflected in an equally thoroughgoing political isolation. With the exception of the Monroe Doctrine, which in its original form was intended as a measure of defense against foreign political and military aggression, the United States minded its own affairs, and allowed the remainder of the world to go its way. From time to time, as necessity arose, additional territory was purchased or taken from neighboring countries--but all of these transactions, up to the annexation of Hawaii (1898) were confined to the continent of North America, in which no European nation, with the exception of Great Britain, had any imperative territorial interest.

The economic changes which immediately preceded the Spanish War period commanded for the United States a place among the nations. The pa.s.sing of economic aloofness marked the pa.s.sing of political aloofness, and the United States entered upon a new era of international relations.h.i.+ps.

Possessed of abundant natural resources, and having through a long period of peace developed a large working capital with which these resources might be exploited, the United States, at the beginning of the twentieth century, was in a position to export, to trade and to invest in foreign enterprises.

The advent of the World War gave the United States a dramatic opportunity to take a position which she must have a.s.sumed in any case in a comparatively short time. It had, however, one signal, diplomatic advantage,--it enabled the capitalist governments of Europe to accept, with an excellent grace, the newly acquired economic prominence of the United States and to recognize her without question as one of the leading political powers. The loan of ten billions to Europe; the sending of two million men at double quick time to the battle front; the immense increases in the production of raw material that followed the declaration of war by the United States; the thoroughness displayed by the American people, once they had decided to enter the war, all played their part in the winning of the victory. There were feelings, very strongly expressed, that the United States should have come in sooner; should have sacrificed more and profiteered less. But once in, there could be no question either of the spirit of her armies or of the vast economic power behind them.

When it came to dividing the spoils of victory, the United States held, not only the purse strings, but the largest surpluses of food and raw materials as well. Her diplomacy at the Peace Table was weak. Her representatives, inexperienced in such matters, were no match for the trained diplomats of Europe, but her economic position was unquestioned, as was her right to take her place as one of the "big five."

2. _Dividing the Spoils_

The Peace Conference, for purposes of treaty making, separated the nations of the world into five cla.s.ses:

1. The great capitalist nations.