Lord Rosebery said, in a recent speech before the Wolverhampton Chamber of Commerce: "The Americans, with their vast and almost incalculable resources, their acuteness and enterprise, and their huge population, which will probably be 100,000,000 in twenty years, together with the plan they have adopted for putting accumulated wealth into great cooperative syndicates or trusts for the purpose of carrying on this great commercial warfare, are the most formidable...rivals to be feared."The London Times says: "It is useless to disguise the fact that Great Britain is being outdistanced.The competition does not come from the glut caused by miscalculation as to the home demand.Our own steel-makers know better and are alarmed.The threatened competition in markets hitherto our own comes from efficiency in production such as never before has been seen." Even the British naval supremacy is in danger, continues the same paper, "for, if we lose our engineering supremacy, our naval supremacy will follow, unless held on sufferance by our successful rivals."And the Edinburgh Evening News says, with editorial gloom: "The iron and steel trades have gone from us.When the fictitious prosperity caused by the expenditure of our own Government and that of European nations on armaments ceases, half of the men employed in these industries will be turned into the streets.The outlook is appalling.What suffering will have to be endured before the workers realize that there is nothing left for them but emigration!"That there must be a limit to the accumulation of capital is obvious.The downward course of the rate of interest, notwithstanding that many new employments have been made possible for capital, indicates how large is the increase of surplus value.
This decline of the interest rate is in accord with Bohm-Bawerk's law of "diminishing returns." That is, when capital, like anything else, has become over-plentiful, less lucrative use can only be found for the excess.This excess, not being able to earn so much as when capital was less plentiful, competes for safe investments and forces down the interest rate on all capital.Mr.Charles A.
Conant has well described the keenness of the scramble for safe investments, even at the prevailing low rates of interest.At the close of the war with Turkey, the Greek loan, guaranteed by Great Britain, France, and Russia, was floated with striking ease.
Regardless of the small return, the amount offered at Paris, (41,000,000 francs), was subscribed for twenty-three times over.
Great Britain, France, Germany, Holland, and the Scandinavian States, of recent years, have all engaged in converting their securities from 5 per cents to 4 per cents, from 4.5 per cents to 3.5 per cents, and the 3.5 per cents into 3 per cents.
Great Britain, France, Germany, and Austria-Hungary, according to the calculation taken in 1895 by the International Statistical Institute, hold forty-six billions of capital invested in negotiable securities alone.Yet Paris subscribed for her portion of the Greek loan twenty-three times over! In short, money is cheap.Andrew Carnegie and his brother bourgeois kings give away millions annually, but still the tide wells up.These vast accumulations have made possible "wild-catting," fraudulent combinations, fake enterprises, Hooleyism; but such stealings, great though they be, have little or no effect in reducing the volume.The time is past when startling inventions, or revolutions in the method of production, can break up the growing congestion; yet this saved capital demands an outlet, somewhere, somehow.
When a great nation has equipped itself to produce far more than it can, under the present division of the product, consume, it seeks other markets for its surplus products.When a second nation finds itself similarly circumstanced, competition for these other markets naturally follows.With the advent of a third, a fourth, a fifth, and of divers other nations, the question of the disposal of surplus products grows serious.And with each of these nations possessing, over and beyond its active capital, great and growing masses of idle capital, and when the very foreign markets for which they are competing are beginning to produce similar wares for themselves, the question passes the serious stage and becomes critical.
Never has the struggle for foreign markets been sharper than at the present.They are the one great outlet for congested accumulations.
Predatory capital wanders the world over, seeking where it may establish itself.This urgent need for foreign markets is forcing upon the world-stage an era of great colonial empire.But this does not stand, as in the past, for the subjugation of peoples and countries for the sake of gaining their products, but for the privilege of selling them products.The theory once was, that the colony owed its existence and prosperity to the mother country; but today it is the mother country that owes its existence and prosperity to the colony.And in the future, when that supporting colony becomes wise in the way of producing surplus value and sends its goods back to sell to the mother country, what then? Then the world will have been exploited, and capitalistic production will have attained its maximum development.
