LAND A M J:> W a T E R 
January zo, 1916. 
Danker is essentially an internationalist. .Hip , regards 
all nations with an entiiely' impartial eye. He is 
swayed by one motive only — namely, the detern'.ination 
to win big dividends with the least possible risk. If 
the foreign competitor requires financial accommoda- 
tion and is willing to pay a higher rate of interest than 
the British producer (with the same security) tiie foreigner 
win^ There are dozens of (ierman industries nourishing 
to-dav. built up and supported by British capital. 
It has long been the cry of English lirms that their banks 
offer them little or no support in the development of 
their businesses. 
The Two Banking Systems. 
Tile broad distinction between the British and 
(ierman Banking System is that whilst the former 
deiJv-nds for its rewards upon what the ancients termed 
usurv (that is, ))ayment for use), the latter depends upon 
production. .\nd between these two systems a great gulf 
i< fi.ved. For the one is less concerned with the industrial 
success of its own country than the other. It is not of 
such serious moment to" the London banker whether 
British trade is dull as the decline of (kunian trade is to 
the German banker, for the London banker regards the 
world as his oyster. If the British ]>roduccr tinds trade 
too dull to employ the bank funds profitably, there are 
others. The (ierman. or American, the Canadian or 
Argentine merchant will be glad to employ them. Hence 
the dividends of our banking companies show com- 
paratively little variation regardless of our trade con- 
ditions. But industrial depression of the Fatherland 
nuans financial depression for the German banks, and 
'i>icc-vcrsa. Hence it is entirely to the advantage of the 
German banker to assist to the best of his ability in 
stimulating the industrial prosperity of his own people. 
Our ban'rcing system deserves a chapter to itself. As a 
safe system for earning steady dividends for bank share- 
holders it stands almost unrivalled. For, as was, demon- 
strated in August, i()i4,in times of crisis it has the credit 
of the nation behind it without having any well-defined 
responsibilities thru .t upon it, so that whilst the banks 
are allowed to reap all the profits, the nation is compelled 
to take the risks. There are no obligations on the part 
jf anv of our banks to render aid or facilities to any British 
industries whatsoever. Such help is purely optional. 
As a national institution, our banking system is one 
of the most expensive and harassing that could possibly 
be devised. It taxes the British producer for the benefit 
of the foreigner. It compels him to provide at all times 
a free gold market and a fixed level for gold, chiefly for 
the benefit of foreign merchants. It subjects him to the 
most variable bank rate in the world ! ! It has been 
variously estimated that every advance of i per cent. 
ill the bank rate costs this country from £50,000 to 
£100,000 per week ! 
In addition to all the advantages enumerated and 
possessed by the German producer, there is the further 
one that he is protected to a large extent from foreign 
competition in his home market. Every Government 
dejwrtment in the Fatherland is forbidden to order goods 
from foreign firms where similar goods are purchasable 
in Germany. On the other hand, it has long since been 
the settled policy of our own Governments, Railway 
Companies, Municipalities and (Corporations generally, 
to buv in the cheapest market, regardless of consetjuences. 
Wlicil f>ossib!c chance lhcH\is there lor British firms to 
capture Germun trade ? The ansivcr is that there is no 
chance unless the conditions are completely changed. ■ \ 
Before the War. 
Prior to the war. the man or firm who made such an 
ittempl. soon discovered that he was fighting not 
merely a (ierman competitor but — the entire (ierman 
nation. .\nd just as many of the small shopkeeper- 
have been driven out by the great departmental stores, 
just as the small producer has been wiped out by the 
Trust and Combine, so many of our manufacturer* alid 
merchants have found successful competition with 
(jerman houses — backed as they are by all the strengtl; 
of the Gennan Government — impossible I Since the war 
started, many instances have come tt) our knowledge 
of enemy firms having been guaranteed certain dividend- 
by their Government, provided they used e\ery etlorl 
to o\ist jival nations from loreign markets. These finrii 
were even advised to offer goods below cost, until all 
competitors were driven out, such losses being made 
good by the State. 
Again, the interest of the (ierman authorities in 
every branch of industry is illustrated by their policy of 
furnishing 'gratuitious help to (ierman inventors andjdis- 
coverers. Take, for example, the glass industry. Heat- 
resisting glass is a comparati\ely modern discovery, and 
was practically a German monopoly when the w-aj- started, 
'i'he story of the rise of this industry was told me by a 
(ierman professor of Jena some years ago. Two pro- 
fessors of the' University of that town stumbled upon a 
method of manufacturing glass which could withstand 
both high and low temperatures without breaking. 
Recognising the value of their discovery they applied to 
the (iovernment for financial assistance, and it is said 
the (iov.erument immediately responded with a gift of 
.500,000 marks for the purpose of lompleting their experi- 
ments and starting the industrj^ This industry employed 
at the outbreak of the war many thousands of people, 
and represented some millions of pounds of revenue to 
the German nation. 
Again, compare the German Government's attitude 
towards their dyi: industry, which has become another 
vast monopoly, to the treatment accorded this industry 
by our own. Here was an original British invention made 
the basis for a German monopoly I Is it not a fact that 
hundreds of British inventors have had to go abroad or 
sell their inventions to foreigners in order to get them 
taken up? Have not many of our progressive manu- 
facturers been compelled to import German chemists 
and scientists to assist them in the development of their 
manufactures ? Can we possibly wonder at the enor- 
mously greater progress of (ierman industries when we 
contrast the entirely different attitudes of the two races 
and their Governments ? 
Business Patriotism. 
What advantage — economically speaking — has it 
been to an inventor or manufacturer or business man 
generally speaking, to belong to the British nation? 
What privilege or advantage has his British birth and 
citizenship conferred upon him which the foreigner is not 
equally entitled to ? Except for the purpose of taxing 
him or soliMting his vote, w'hat evidence is there that our 
Governments have been actively interested in the 
success of the average Briton ? 
In conclusion, (German trade can be captured only 
by the nation that can emulate (iermany in her enter- 
prise, her knowledge, her organisation (where the (iovern- 
ment lends its wholehearted support to its producing 
classes), and. finally, in her banking methods, where the 
banks recogr^ise their chief functions to be the support 
and development of this nation's trade and industries. 
The lesson of business patriotism has yet to be learned 
both by our (iovernment and j)eople. No German could 
have written such a letter as that recently published by a 
well-known Earl, who asked if it was conceivable that the 
British jiublic would stand being compelled after the war 
to pay more for certain goods instead of buying them from 
(iermany ? If' we are to win in our future trade w-arfare, 
we must pj-esent a solid front to the enemy. We must 
mobilise all our forcesi of production. We must con- 
solidate our credit. The (iovernment and people mu-^t 
unite to support aiid help each other. Our Ambassadors 
and Consuls must all be British to the core. They should 
, be conversant with trad(^ and commerce in all its branches, 
and constidite the advance guards for opening up new 
fields for conquest by our merchants and manufacturers. 
The Government should nationalise our banking system 
and plaice 'bJiAiking facilities on easy terms within the 
reach of all classes. Inventors, discoverers and scientists 
should obtain social -^ recognition . proportional to, their 
attainmcnts,;and<the conferring of titles on men of wealth 
regardless pf the means by which their wealth has been 
acquired should cease. 
In s'plte' of our many shortcomings, this nation 
possesses" alh'tlie'Hfaterial and resources for leading the 
world industrially, -intellectually and spiritually, to greater 
heights -than. ha,vc^cvtr,y4it been foreshadowed. For the 
accomplishp\t;nt of, this, all we need are leaders who have 
t!)c knowlc'dgc. the wilT and the ability to organise and 
develop these resources. 
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