Trade and the Flag 3 



berment of China by the western powers. Spain is a declining 

 colonial power, yet she still controls about 80,000 square miles — 

 enough territory to make half a dozen Formosas. Turkey, too, 

 through misrule, sees its possessions slipping away entirely or 

 retained only nominally. Since Bulgaria declared independence 

 there remain but Egypt, Samos, Crete, and Anglo-Egyptian 

 Soudan. Austria-Hungary took the occasion of the recent 

 Balkan troubles to declare her occupation of Bosnia and Herze- 

 govina permanent, a move which did not occasion great surprise, 

 however. Since the decline of the Danish West Indies, Den- 

 mark's most prosperous colony is Iceland. The Dutch, by their 

 work in Java, have attracted much criticism both adverse and 

 favorable. Portugal, like some of the other colonizing nations, 

 seems to be more successful as a colonial exploiter than as a 

 developer of colonies. 



The fact that the colonizing nations expect to reap some eco- 

 nomic gain, especially in the line of trade, from their possessions, 

 makes the question "Does trade follow the flag?" ever a timely 

 one. But in order to determine whether any part of the com- 

 merce between the mother country and its colony, aside from 

 tariff-controlled trade, is due to their political relations, a con- 

 sideration in some detail of the main factors influencing the 

 movements of goods is necessary. Some general propositions 

 regarding trade are, therefore, presented. 



Trade, if not interfered with, follows the price list. 41 Efficiency 

 and economy of industrial production are more and more recog- 

 nized as the chief factors in expanding trade. An English writer 

 gives as his view of the causes of American success in trade the 

 fact that, in the first place, an American is not content with one 

 thriving business but will speculate in another enterprise or even 

 twenty, and greater risks mean greater opportunities for gain. 

 An English firm has been known to refuse to book orders because 

 it had enough work for two years ahead ; an American firm would 

 have risked an extension of plant and continued taking orders. 

 In the second place, an American will sell at a loss to create a 



4 Cf. Farrer, "Does Trade Follow the Flag?" in Contemporary Review, 

 74 ■■ 832. 



179 



