ioo CHARLES R. FLINT 



particular industry, have proved their ability and judgment 

 to assume the responsibilities of leadership, and owing to 

 the higher evolution of our industrial organizations, these 

 men are developing greater intelligence and superior ability 

 to those who have preceded them. Thus the fittest survive. 



In life nothing is stationary; contraction or expansion 

 goes on continuously, and if you do not expand, you contract. 

 It is so with nations, and it is so with industry. There are 

 periods of expansion when the mills are running full, and 

 there are periods of contraction when the number of unem- 

 ployed is large. Confidence is at the foundation of expanding 

 business activity. The amount of business transacted on 

 credit is over two thousand times that transacted in exchange 

 for gold or silver. If there is confidence, the manufacturer 

 employs many hands, the laborers purchase more, the retailer 

 buys more goods, the jobber orders more from the manu- 

 facturer, the manufacturer, to still further increase his output, 

 employs more hands, and every man who wants work can 

 find it. This is prosperity. Lack of confidence causes con- 

 traction — the manufacturer is afraid to make many goods; 

 discharges some of his laborers; they purchase less; the jobber 

 cancels his orders ; the manufacturer must still further reduce 

 his payroll. The result is "hard times." 



In view of the fact that the maintenance of high wages 

 in the United States is largely dependent upon our increasing 

 exports, the question is asked whether we could sustain them 

 in competition with the cheap labor of China, were China to 

 become a manufacturing country. The best answer is that 

 among our other exports, we have shipped 200,000,000 yards 

 of cotton cloth to the Chinese. The average rate of wages 

 paid by us in its manufacture was seven times the average 

 rate of wages prevailing in China. The Chinese, like the peo- 

 ple in our own country who have a Chinese cast of mind, do 

 not recognize the advantages of combination. Industrially, 

 they are living in the land of yesterday, instead of in America, 

 the land of to-day and to-morrow. Notwithstanding her 

 great agricultural and mineral wealth, notwithstanding the 

 fact that she has the largest body of cheap labor in the world, 

 China is not an efficient competing factor in the field of pro- 



