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The Commoner
VOL. 14, NO. 2
Our Trade Relations in the Far East
Addresses at the Banquet of the American-Asiatic Ass'n, New York, Jan. 26, 1914
Address dclivorod by Mr. Willard Straight,
prosidont of tho aosocintlon:
Mr. Secretary, Mr. AmbaHHador, Mr. Minister
and gentlemen, on behalf of tho Amorican
ABiatic association, 1 bid you welcome.
To you Mr. Ambassador and to your fellow
countrymen, on behalf of this association, I wish
to oxtond tho heartfelt sympathy which wo feel
for you all in tho face of tho great disaster
which ban befallen your countrymen and to as
Burd you that wo share your grief at the terrible
losses you have sustained. Wo are particularly
gratified that you Mr. Socrqtary should have
found it possible to honor us by your presence
this ovening, and Mr. Minister and M. lo Charge
d'Affairs, without you our evening would have
been incomplete.
Wo are gathered hero tonight, gentlemen, as
bUBinosn men interested in trado with tho far
oast, to do you honor. Wo hope that you will
honor us with your conlldonco and frankly dis
cuss some, at least, of those Questions which are
of mutual interest, as woll as tho problems
whoso successful solution must depend very
largely upon our common understanding and
our continued cooperation.
No dinner of this association has over been
hold, I imagine without some reference to Wil
liam A. Seward's prophetic words regarding our
future on tho pacillc. Tho Pacific era which ho
foresaw is no longer a dream. This day has
dawned. It extends its promiso and imposes its
responsibilities, and this annual dinner of the
American-Asiatic association is, therefore, more
significant perhaps than any that has preceded it.
Within a few months the Panama canal will
bo opened, a great highway for tho trado of the
world. Has it occurred to you that we in the
Unitod States, while wo are conscious certainly
of the magnitude of tho task now Hearing com
pletion, may havo failed to grasp the full import
of its influenco on tho development of interna
tional commerce and havo neglected porhaps the
vory necosaary preparations for realizing oppor
tunities which wo have created and which our
foreign friends havo for some years eagerly
anticipated?
The past year, moreover, has witnessed one
of tho most remarkable achievements in our
political history. President Wilson unabashed
by criticism undeterred by opposition between
March and December, has secured the passage,
first, of tho tariff, and, second, of the currency
bill. Whether or not wo be entirely in sympathy
with tho measures now enacted, makes little dif
ference. Wo cannot, no matter what our politi
cal creed, withhold an admiration border'ng al
most upon wonder for the force and singleness
of purpose of our chief executive who, with the
loyal and active assistance of tho premier of his
cabinet, has wrought a legislative miracle by so
nearly squaring promise and performance.
Tho opening of the Panama canal, by remov
ing geographical barriers, must stimulate
foreign commerce. Tho currency bill just passed
permits the establishment of branches of Ameri
can banking institutions abroad and should free
vast sums for use in an international discount
market and for the purchase of desirable foreign
securities. Thus, with added transportation
facilities and with opportunity for the extension
of both banking and investment, we are in a
bettor position than at any time in our history
aggressively to undertake the development of
our export trade.
Not only this, but the tariff bill, facilitating
as it does the importation of foreign goods, im
poses upon our manufacturers the necessity of
carrying the war into the enemy's camp and com
peting abroad with those who will now invade
our own market.
Tho era of discovery, the era of conquest, are
passed. The world's boundaries disputes are
rapidly being settled. Opportunities for na
tional, as well as for individual exploitation are
everywhere curtailed, and nations, like indi
viduals, must earn their living.
The era upon which we are entering is not
only that of the Pacific ocean, it must be one of
Pacific development as well. The barriers of in
dustrial exclusivoness are fast disappearing.
World peace, of which our honored guest is such
an active and sincere advocate, it becoming a
practical, as well as a highly desirable, possibil
ity. It is as essential to the development of in
ternational trade as internal tranquillity is to
national progress. It is doubtless true that we
may not for many years to come be able to sub
stitute tho reaping hook for the sabre and the
sewing machine for the gattling gun but, some
recont events to tho contrary notwithstanding,
it is impossible to deny that the armies of today
aro becoming factors for peace great police
forces imposing perhaps a heavy financial bur
den upon the peoples which support them but at
the same time guaranteeing them- against ag
gression and bringing to them, through compul
sory military service a conception of discipline
and a feeling of nationalism which would other
wiso bo unobtainable.
The true armies of world peace today, how
ever, are the merchants engaged in international
trade. In this army the secretary of state is a
chief of staff and the ambassador a corps com
mander. We of this association are the rank
and file. We are always in active service in the
world-wide struggle for daily bread. We are
constantly fighting our business war and we are
the points of contact with the real living organ
isms of foreign peoples. Religion has inspired
great movements. Education has brought
mutual understanding to different peoples. I do
not wish to appear even to minimize their value
or to belittle their influence, both past and pres
ent. But international harmony, like connubial
bliss, depends not only upon reciprocal apprecia
tion of high principles and recognition of com
mon ideals, but upon the satisfactory solution
and adjustment of the problems of every day
life. In the family, it is the little things that
count, and, between nations, mutual confidence
and esteem is founded most permanently and
truly upon fair and mutually profitable diplo
matic and business dealings. The greater our
foreign commerce the better will be our rela
tions with foreign peoples and the less chance
there will be for trouble.
At a time when China's negotiations with
foreign financiers were much in the public eye,
1 noticed reference to a newspaper headline en
titled "Ship pursued through Indian ocean by
Chinese ghost." The editorial comment was
that "The ghost probably wanted a loan." I
have no desire to call forth spirits of any kind.
Least of all, the ghost of a Chinese loan. The
withdrawal of the American banking group
from China is a closed incident, but the question
of our diminishing China trade is to the mem
bers of this association a very pressing one and
of the most vital importance. This is the
ghost that bothers us. It is, if I may say so, the
skeleton not in our closet but in our counting
house.
I cannot refrain, therefore, from stating that
many merchants, members of the American
Asiatic association, while not directly affected
by the withdrawal of the American banking
group, have interpreted the announcement
made by President Wilson in March last to
mean that the American government would not
extend to our bankers the support which those
familiar with trade conditions in China con
sider necessary. They are today frankly dis
couraged at our prospects for future business
for in China more than in almost any other
country perhaps trade follows the loan.
I personally feel assured that this impression
referred to is not justified, for President Wilson
even in the announcement mentioned specifically
expressed his determination to aid the extension
of our American trade abroad. He said
"The present administration will urge and
support the legislative measures necessary to
give American merchants, manufacturers con
tractors and engineers the banking and other
financial facilities which they now lack, and
without which they are at a serious disadvantage
as compared with their industrial and commer
cial rivals. This is its duty. This is the main
material interest of its citizens in the develop
ment of China. Our interests are those of tho
open door a door of friendship and mutual ad
vantage. This is the only door we care to
China's growing foreign trade promises great
returns to those engaged therein. To secure
our share we must depend primarily upon the
energy and farsightedness of American mer
chants and manufacturers, but if they are to
take full advantage of these oportunities, they
must, as President Wilson has said, be assured
adequate banking and other financial facilities.
Our merchants now secure the necessary accom
modation chiefly through British, Japanese and
German banks, as well as the one American
bank in the east. The service rendered by
these institutions is adequate perhaps for pres
ent needs. We cannot rely, however, upon
these very good foreign friends of ours to push
American interests as they do their own. This
certainly is not as it should be. Moreover, while
our ordinary merchandising may be financed to
a greater or less extent by foreign bankers,
there is absolutely no chance for American man
ufacturers to sell their goods to railvay or other
government or industrial undertakings, which
are constructed or operated with foreign money.
This after all is but natural. China herself is
not in a position to build railroads or herself to
finance public improvements. She must secure
money from abroad. We cannot hope, therefore,
to share in railway construction in China; we
cannot hope that our manufacturers may install
government arsenals, electric light works, water
works and other public utilities, or that our
engineers can contract for harbor works and
conservancy schemes, until American bankers
can be found willing to purchase the bonds
which China must issue to secure funds to
finance these operations. Reputable American
bankers cannot afford to purchase Chinese bonds
unless their ability to sell them is reasonably
certain, and the American investor is not will
ing to buy Chinese bonds unless he believes the
American government will protect him by all
possible diplomatic means in case the Chinese
government, through difficulties of its own,
should fail for a time to meet its obligations
obligations not to the bankers who underwrite
a bond issue but to the investors who depend
for their income upon a regular return from
these securities. Investors do not want bonds
if there is any chance that the interest thereon
must be collected by war. Such bonds are not
good investments money can be placed much
more safely at home. Investors in foreign
securities do however desire some assurance of
the support of their own government. In, China
it has never been necessary to collect interest by
gunboats and there is little likelihood that it
will be necessary in the future because China
for years to come must finance her necessary de
velopment by foreign loans. No matter what
party may be in power it must borrow from
abroad. It is therefore essential that the pres
ent government of China, or any that may suc
ceed it, should pay interest when due in order
that it may have continued and ready access to
the money markets of the world.
Americans cannot expect, nor can they legiti
mately desire, exclusive support for certain indi
viduals but, if the principle of support for mer
chants, contractors and engineers abroad be
enunciated, assistance must be accorded those
who already have had the courage and enter
prise to engage in foreign trade. If we are to
build up our interests abroad, moreover, firms
which have not as yet established foreign con
nections must be encouraged to do so They
must be regarded as national assets not" as
special interests and whatever our differences
may be at home we must all, diplomats and
consuls, missionaries and teachers, merchants
and bankers, stand together, as Americans. We
must assist each other in the work which we are
doing abroad, be it diplomacy or education or
trade, for once we have seen the dock lights die
we become representatives of our country
trustees for its trade and of its reputation. For
tins reason governmental support, if given, must
be accorded only to those who by their perform
ance will justify the confidence of foreigners' in
the representations of our government and-the
confidence of our own government in them We
must apply eugenics to international trade
I have ventured to speak at some lencth of
certain phases of our trade with China because
the unsettled conditions which still prevail in
that country, despite the masterly administra
tion of President Yuan Shih Kai, give to ? com
mercial problems a political importance 'and
necessitate a degree of diplomatic attention
VrSTQly W0Uld be "uperfluoua" I h?i
been bold to do so, moreover, because all of our
guests this evening are, I do not doubt, thor
oughly familiar with Chinese conditions and are
today dealing with the very problems which III
holding our own attention.
Our guests will, I am confident, agree' that
current diplomatic nrnhi i i,Ib '" ,' iai
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pol tical in character, nevertheless usually have-,
their origin in some matter" either directly or
directly affecting trade. The ambassador or
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