256 ANNUAL REPORT SMITHSONIAN INSTITUTION, 1918. 



by the accession of foreign capital which it was becoming increas- 

 ingly difficult to attain by peaceful methods. In short, Germany's 

 commercial grip on the world, which had strengthened speedily and 

 yet to a large extent unobserved, had finally reached a point where 

 its future strength was becoming imperiled by the growing realiza- 

 tion of other nations and their consequent restlessness under the 

 yoke. Such an autocratic and ironclad policy can not continue for- 

 ever unchallenged, because there exists in the world that inherent 

 democracy of nations, perchance actuated by fundamental self- 

 interest, which at all costs insists upon maintaining to individual 

 nations the right to exist. 



The Russian opinion of German methods is briefly set forth in 

 a small volume hy Dr. Paul Gourvitch 1 written in English and pub- 

 lished in New York in 1917. It is also a fair and unbiased descrip- 

 tion of German commercial power. It gives due credit to the 

 fact that much of her supremacy was due to her own energy and 

 foresight in the conduct of her exporting business by which she was 

 often enabled to supersede the laxer and more "hit-or-miss" methods 

 of her foreign competitors. Gourvitch describes in detail the im- 

 porting and exporting of credit. While giving due credit to Ger- 

 man skill and enterprise in the manipulation of foreign markets 

 he does not fail to note their dishonest and unscrupulous methods 

 in the matter of imitation and counterfeiting in order to replace the 

 commodities of their competitors by their own goods sold at lower 

 prices. 



GERMAN POSTWAR TRADE. 



The volume by Herr S. Herzog, 2 which was published in trans- 

 lated form about two months ago under the auspices of Herbert 

 Hoover, Vernon Kellogg, and Frederic C. Walcott, called "The 

 Future of German Industrial Exports," represents the ideas of a 

 well-known German engineeer on the subject of reestablishing after 

 the war the same methods of commercial supremacy that led to the 

 recent catastrophe. His avowed aim is to regain by strategic 

 means the former commercial position of Germany. He definitely 

 states that since the par value of treaties is nil, any commercial 

 treaty formulated after the war will be worthless. He contends 

 that the treaty will be but the preliminary to an economic warfare 

 having for its object the mastery over German industry. He states 

 that Germany's industrial exports must go on. In order to do this 

 the essential structure of German industry is to be divided into two 

 classes, the first known as " protective industries," representing both 

 raw and finished products of German origin that arc absolutely 



1 Gourvitch, Paul, " How Germany Does Business," B. W. Iluebsch, New York, 1917. 

 - Herzog, S., "The Future of German Industrial Exports," Doubleday Page & Co., 

 Garden City, New York. 1918. 



