LECTURES AND ESSAYS READ AT INSTITUTES. 175 



York to Liverpool must sell for enough to pay for the carriage, and ti business 

 profit over the cost in New York; and the return cargo which really transfers 

 the value must sell in New York at a similar advance. Adverse balances in gen- 

 eral, then, represent the profits of successful commerce. But we have recently 

 enjoyed the so-called "favorable'' balance. Are we, then, carrying on a 

 losing trade? By no means ; our exchanges are in tliis condition to a large 

 extent in consequence of the happy fact that we are rapidly paying oif our 

 debts. In certain other respects our condition is peculiar. The whole matter 

 may be stated in brief terms. 



We are to-day meeting various obligations to foreigners by means of our 

 exports, — (1) as always, we pay in that manner for imports; and (2) we 

 are meeting the interest on the investments of various sorts that foreigners 

 have with us; (3) we have been paying off the principal of some loans, as 

 notably in the case of national bonds sent back for redemption; (4) it is 

 estimated that 1100,000,000 per annum is the cost of carrying commodities to 

 and from the United States, and as that business is mostly in the hands of 

 foreigners, we must pay our share of this charge by increased exports. So, 

 then, our present commanding excess of exports is in part a sign of a national 

 disadvantage. The figures given would be modified considerably if we take 

 into account the exports of precious metals of which this country has for 

 many years had a surplus. The general principle of international balances 

 will bear repeating : "Exports are what we pay to foreigners. Imports are 

 what foreigners pay to us. If our imports were not worth more to us than our 

 exports we should be doing a losing business." 



The statistics of English commerce are instructive upon this point. In the 

 last ten years tlie value of the imports received by England exceeded the value 

 of her exports by nearly $5,000,000,000 ; and at the same time she imported 75 

 millions more of gold and silver than she exported. This enormous "adverse " 

 balance is the sign and proof of England's boundless wealth. What are the 

 items included in the vast excess? They are (1) the profits of successful 

 trade ; (3) the earnings of her ships ; (3) interest upon her investments abroad ; 

 (4) the discounts of lier bankers in settling the transactions of .the whole 

 world. 



C0NCLU8I0X. 



It is evident that trade between nations as between individuals, is founded 

 upon mutual advantage. The American farmer has found a large market 

 abroad and must continue to do so, or else largely restrict his production. 

 And the foreign buyer must make his payment by means of commodities sold 

 to this country. Thus the larger our exports of surplus products, the greater 

 the American dematid for foreign commodities; and the larger the sales of 

 those commodities in our markets, the greater the demand for our surplus, 

 whether of farm products or of manufactures. Our exports of manufactured 

 products i!ow amount to from one-eighth to one-sixth of all values exported ; 

 agriculture, the- mines, and fisheries make up tiie rest. What is more, agricult- 

 ure bids fair, with the opening of new land and the expanding live stock business, 

 to add to the three-fourths of our exports which it now supplies. On the other 

 hand, our manufacturing establishments are reducing wages or entirely shut- 

 ting down, and there is a widespread cry of depression. The available market 

 will not take all our mills can make; the capacity of our iron mills far out- 

 runs the present demand; our cotton mills can till the domestic market by 

 running less than nine months out of tlie twelve on full time; a similar con- 



