388 TEE POPULAR SCIENCE MONTHLY 



otherwise meet the trade conditions of different countries. Growing 

 out of this will be a stimulus to exporting business. Firms can hold 

 goods for an indefinite period without the payment of customs taxes, 

 often equal to the cost of the article itself. 



3. Such ports will upbuild our banking and financial relations with 

 other countries. It will shift to America an increasing share of inter- 

 national exchange. It will make America what, by reason of its size and 

 natural resources it should be, the clearing-house as well as the financial 

 reservoir of the world. 



This is an opportune time for the development of the free port, 

 even though only one or two experiments are made. A large part of 

 the shipping of the world has been driven from the seas. English, 

 German and Belgian bottoms are in danger of capture. Old trade 

 routes and commercial connections have been destroyed. 



In addition the opening of the Panama Canal will still further dis- 

 locate trade routes, just as did the opening of the Suez Canal. It places 

 New York, New Orleans and San Francisco in a far different relation 

 from that which they previously occupied. 



The recently inaugurated Federal Reserve Bill makes pos- 

 sible the development of branch banks and the working out of inter- 

 national credit, which will go hand in hand with the upbuilding of 

 over-seas traffic and the merchandise and consignment business that 

 exists in countries where free trade prevails. 



Finally, America is the natural country to be the counter or clear- 

 ing-house of the world. Our seacoasts face every other continent. 

 This country is the greatest of all reservoirs of raw material and food 

 supplies. It has unlimited iron, coal, copper and other mineral re- 

 sources. In the iron and steel business and in other industries that are 

 easy to standardize we are in position to compete with the world. But 

 these advantages are of limited value to us so long as means of cheap 

 and expeditious transportation are denied, or so long as it is necessary 

 for our products to pass through foreign hands. And these conditions, 

 the upbuilding of our marine, the development of our foreign trade, 

 the extension of international financing depend upon means of clearing 

 away the obstacles which now place America at a disadvantage in com- 

 parison with the free ports of Great Britain and Germany, which are 

 the present clearing-houses of the world. 



ECONOMIC IMPORTANCE OF AMERICAN NEUTRALITY 



By Peofessoe GORDON E. SHERMAN 



YAT.m UNIVEESITT 



"^TEUTRALITY, regarded as a conception of international law, 

 -L^ " consists in abstinence from any participation in a public, pri- 

 vate or civil war, and in impartiality of conduct toward both parties 



j'l 



