for estimating duties on merchandise imported into the United States, in respect to which the original cost. shall be exhibited in a depreciated currency, issued and circulated under authority of any foreign Government.

Acting under the authority conferred by this section, it has been decreed by Executive Order of November 13, 1919, that if the currency specified in the invoice is exchanged for United States currency in the country of exportation at a rate which is lower than the value proclaimed by the Secretary of the Treasury, the consul shall attach to the invoice a currency certificate showing the percentages of depreciation as compared with the corresponding standard coin currency and the value in such standard coin currency of the total amount of the depreciated currency stated in the invoice. The British pound sterling being quoted at an exchange value of $3.80 (approximately 20 per cent below its par value), such fact has been. held to constitute a depreciation within the meaning of Section 2903, R. S., and the Executive Order of November 13, 1919, and duties are now assessed on the basis of this depreciated value, thus accounting for the second decrease. Thus it will be observed that while it cost $6.566 per pound sterling to land British woolen clothing in the United States in 1913 it now costs only $5.13 per pound sterling to land like goods here.

This is not only true as to British woolen clothing, but is equally ap

plicable to goods imported from other countries having an adverse rate of exchange, and establishes the rule that the lower the foreign rate of exchange the cheaper can goods purchased at such rates be landed in the United States in competition with like goods of home production, thus decreasing to that extent the measure of protection originally carried by the tariff act.

The development here described is the more noteworthy in view of the novel competition which American textiles are beginning to experience, as witness the advertisements of British and French fabrics in the daily newspapers.

The Executive Order of November 13, 1919, operates in two ways to favor the importer. Before it was issued it was necessary for him to pay the duties on the par of exchange, and to recover the difference through the long process of making and proving a claim. This necessity has been removed; and this, it must be presumed, was the primary purpose of the order. But the fact cannot be blinked that, in view of the unparalleled depreciation in the rate of exchange, the order assists materially in lowering the actual protection provided in the Tariff Act. haps under the present abnormal conditions this sacrifice of protection may be regarded with equanimity, unless with respect to dyestuffs; but it cannot be so regarded indefinitely.

Per

Germany's elaborate plans to dominate the world's trade are the most important revelations of the war. The systematic plans of Germany to completely dominate the industry and trade of the world are significant and alarming. They will explain in part the arrogance toward the world outside of the constituted domain of the Imperial Government. This is the inevitable result of the doctrine expressed by Dernburg when he declared the Germans the "most scholarly and wise of all men."

Germany was a system, built as per rule of the architect. The purpose was world domination. Its chief plan was through commerce, by propaganda enforced by the military power. The world was slow to be convinced, only war could compel it. Commerce was looked upon as business to be commended, propaganda as legitimate, not to be condemned, and only the great military strides suggested possible dangers. This compact Empire, which entered upon a new life back in the forties of the last century and stepped out on a platform of dangerous make in the seventies, attracted much favorable comment for its wonderful growth. A population of 36,000,000 in 1870 nearly doubled itself in forty years. To its intensive system of agriculture it added an achievement in organized. industry second to no nation. "Made in Germany" became a label which was not only met in every country,

but which was looked upon as an assurance of efficiency and thoroughness in workmanship.

The country which heretofore saw a stream of emigration leaving its borders for foreign parts, by a wellworked policy now saw the current turned toward rather than away from Germany. Immigration rather than emigration became the order. There was still a flow outward, but not by those who bade farewell to the fatherland, but rather German scholars, industrialists, and expert agents who left home as Germans to remain away as Germans, and thereby extend the influence of the fatherland beyond. the borders of the national domain.

This will account for the more than 200,000 Germans in 1914 in Paris, and the great numbers of Germans in every country in both Europe and America. In Russia alone there were nearly 2,000,000 of them assidulously developing a Germany within the borders of the late Czar. It will be recalled that the foreign secretary warned Gerard that in the United States there were 500,000 German citizens who held primary allegiance to the fatherland, and who could and would make it impossible for America to war against Germany. It was on this occasion that our ambassador reminded reminded the secretary that there were also 500,000 lamp posts in America. This reaching out beyond the borders will also be noted in the development of German industry in

all countries, including those of North and South America. It will account for the great ship lines, immense dock systems, and wonderful transportation facilities to be found in every seaport open to her commerce, which comprehends most of the world. Witness the presence of not only German citizens but German industry in cities like Antwerp, Rotterdam, Genoa, which are but representative of European centers, and even in our own country, which had become in localities a transplanted people from the fatherland.

Germany came to this stage not by accident, but by elaborated plan. Her population has grown wonderfully, which has ever been favored by German philosophy, as well as governmental policy. Internally those in charge fostered the habits of industry among the people. Legislation looking to building up a powerful nation, independent of the outside world in such degree as is possible and seeking dominance outside in matters upon which she must look beyond her borders, was foremost in the minds of the autocracy. To this end her laws restricting expatriation and forbidding emigration, as well as those favoring immigration, were speedily enacted and rigidly enforced. The foremost need of this growing country was a system of industry which would find employment for the various elements of the Empire. The upbuilding of great industries to utilize the resources was necessary. Expansion, not so much in territory but in operations of industry, was requisite.

German industry was unlike anything of its kind elsewhere. It was

ity is not a trait of this people. Not even teamwork is prominent, since in teamwork the individual is something more than a mere cog, as he must act his part as an individual as well as a part of the team. But concentration in Germany leads to disintegration the moment the individual is left alone, a fact exemplified in the German lines at the front.

The first striking fact in Germany's great industrial strides toward commercial dominancy is her utilization of the expert-the research research man. There is no country which has placed such emphasis on the value of the university and its products. No country in the world has approached Germany in the number of research institutions, as well as the number of research men. That country placed the stamp of dignity upon her scholars. To wear the title of doctor or even professor in Germany at once designates rank. In Germany, unlike our own country, the university was an institution of the Government. The professors or doctors were therefore in a way governmental officials. Their duties were assigned with reference to the Government. Teaching or directing research in the university was not always their entire duty. They were loaned for part time duty to various great industries for counsel and research. In one famous dye industry there are employed nearly 150 chemists, of whom at least 70 are employed in research exclusively, at an annual expense of at least $70,000,

while the others have the direction of the business as a growing concern. Most frequently in the office of director in any German industry can be found a university professor, with no further connection than councillor or expert adviser, loaned to the industry. by the Government. This working connection between the industry and the laboratory was established in almost every great industry where expert advice and research are of value. The result of such a policy was not only vast increase of product due to invention or discovery or both, but also in a lowering of cost of the article. In the case of the 70 research men one man might make a discovery, like our own Dr. Rittman, which would result in an increase of product that would more than pay for the entire expert force of the business for the balance of their lives. The chief item here is the connection of the industry with the Government in production, which in Germany was the autocracy directing all industry.

This will produce, if not forestalled, a problem of a possible overproduction, which in turn would be shown in vast unemployment and necessarily great suffering among labor. Hence the effort by the Government to regulate production on the one hand and increase consumption on the other. The cartel system so well and long established in Germany is the chief item in the method. Unlike our own country, which by law makes it a crime to regulate production and control prices, Germany by governmental decree created the cartel for that very purpose. In this way, since the business is looked upon

as of the fatherland, it will be permitted to sell in one country at one price, in another at a different price, and at home at still a different price. It has been the policy of the cartel system permitted by the German Government to sell in a foreign country way below the price at home in order not only to develop a foreign. market for the surplus product, but to drive out of existence in the foreign country the competing industry. This has been done in many various lines, especially in lines of chemistry, dyes, and so forth.

This is what Germany terms the system of dumping. In every country doing business with Germany the deleterious effects of dumping are experienced. It extended to agriculture as well as manufacturing. This underselling was made possible by several agencies at work in the export trade of Germany.

railroads, while others combined their interests. Another feature of these banks was the enormous issues of capital in short periods for development purposes, a practice not countenanced by our country. As the cartel system was permitted in industrial production, so a system of grouping of banks for financial purposes was not only allowed but favored by the Government. In this way the mother institution was located in the home country and branches were established throughout the world, and, in addition, branches of these branches were permitted, so they might be mentioned as mother banks, daughter banks, and granddaughter banks. In Buenos Aires, for example, is a branch or daughter bank, of which there are no less than eleven sub-branches throughout the countries of South America. Each of these will have direct connection with the home country and operate as a powerful agency for spreading German influence.

The German banking system would not be regarded by any English or French speaking country as sound, and consequently these countries are not willing to enter into competition on that plane, and must therefore necessarily suffer loss of trade when in the business of rival development, whether at home or abroad.

This consideration viewed in connection with her dumping system will explain how Germany first kills the preparatory industries in any country which attempt to compete with her. As was recently said by a prominent French economist, "German industry thus shatters all the forces which

can compete with it in such a way as to reign over the ruins."

Still another great arm of this com mercial monster was her transportation system, especially her ship lines, both inland and overseas, and all necessary appurtenances, such as docks, wharves, cranes, and all that enter into the value of ports. It is well known that Germany operated her rail system most largely by government agency. It is not so well known that her water systems, rivers and canals, had been brought to their maximum possibilities. I will not enter upon that phase of the problem. except to say no other country in the world has made such use of her waterways system. All her rivers were highways and the cities upon the rivers were veritable hives of industry. Her canal system was only a part of a completed plan of transportation. Her mercantile business lined the shores of the river and canal, whether it be in Hamburg or Antwerp, Rotterdam or Genoa. The three latter were as distinctively German as if located in Germany.

There was a close relationship between rail and ship transportation. It so arranged the system of forwarding that discrimination of rates were so allowed that countries like Italy were made commercially dependent upon Germany. Germany devoted great effort to building her overseas trade. In 1901 Germany saw 52,000 vessels, aggregating 9,000,000 tons, leave her ports, while eight years later she saw 65,000 vessels, aggregating 13.000.000 tons, in motion, which indicates that at least 70 per cent of her trade was carried on the water. Germany