Segak.— T/te Balance of Trade. 193 



If we are to be able to judge changes in commerce impartially 

 and without panic we must view things as they are, and get rid 

 of the notion that it is possible by any means whatsoever to 

 reserve for all time pre-eminence in the wealth and commerce of 

 the world for one small island. There must be indisputable 

 merit in a system that has kept it there so long. 



Balance of Trade of Germany. 



The line in fig. 3 representing the balance of trade for Ger- 

 many is only given as starting from the year 1880, as no com- 

 parable statistics can be given for previous years owing to the 

 great changes in the methods of compiling the German import 

 and export statistics which took effect in that year. But the 

 fragment that is given is of great interest. It shows a great 

 rise beginning from the year 1886. In 1886 there was an excess 

 of exports of £5,000,000, and this changed by 1898 — i.e., in twelve 

 years — to an excess of imports of over £66,000,000. The total 

 change in the balance of trade was thus £71,000,000, in the 

 direction which is commonly regarded as unfavourable. 



It is worthy of particular notice, too, that this change suc- 

 ceeded the adoption of rather high protection by Germany — 

 which must be of particular interest to such as may still entertain 

 any belief that protection favours exports at the expense of im- 

 ports. 



The far more rapid growth of German imports than of exports 

 in this period tells us that if Germany has been sending her goods 

 abroad to a greater extent than before, she has increased her 

 purchases from the rest of the world to a far greater extent. 

 It will be noticed that the import and export of gold is steadier 

 in the case of Germany than in that of the other countries, and 

 that in no year since 1884 has there been any balance of export 

 of gold. The import of gold necessary on the whole has been 

 sufficiently regular to effect a balance of imports in each of these 

 years. This feature is undoubtedly the result of the policy of 

 the State bank of Germany. This is well described by Mr. 

 George Clare as follows : " As to imports, the Reichsbank ac- 

 celerates them by the simple and legitimate expedient of paying 

 a better rate for foreign gold coin than the tariff price of other 

 State banks, and, in addition, by sometimes bearing the few 

 days' loss of interest incurred in bringing the gold over. To 

 circumvent exporters is doubtless a task of somewhat greater 

 difficulty, but apparently not beyond accomplishment. In the 

 first place the bank immediately parries the demand by putting 

 up its rate, and secondly, in order to gain delay until the increased 

 rate has had time to act, gives the big banking-houses to under- 

 stand, so it is said, that there are sometimes higher issues to be 



13— Trans. 



