Vol. XXII

Number One

A

NEW sense of responsibility has been stamped upon the minds of all loyal Americans by the grim spectacle of twentieth century warfare which treats solemn international pledges with contempt and grinds underfoot the most sacred treaty relations. It has perhaps dawned upon us that, as a people, we have lost contact with the rugged, inspiriting ideals which nerved the hearts of those patriots who laid the foundation of American independence. The events of the past year, even if viewed from a distance, have given us a better understanding of their sacrifices and heroism for the sake of principle. Before another twelve months pass by we shall know if these traditions and heritages are to be preserved. If we fail to win back the spirit which animated the founders of this republic, then we shall merit universal reproach; we shall be hailed as a nation of "money-grubbers," quick to seize the fleeting profits of complacent neutrality, but unwilling to exert ourselves in the readjustment of human society to civilized standards.

In the light of what has transpired in Europe during the last year and a half, there is but one safe formula. That is to clothe "Americanism," not for offensive purposes but as a guarantee of peaceful rights-with that authority which can only be derived from a state of naval and military "preparedness." With prophetic vision Washington foresaw this need

when he said to Congress: I cannot recommend to your notice measures for the fulfillment of our duties to the rest of the world without again pressing upon you the necessity of placing ourselves in a condition of complete defense and of exacting from them the fulfillment of their duties toward us." In another message, he said: "To secure respect to a neutral flag requires a naval force organized and ready to vindicate it from insult or aggression."

The alternative of establishing efficient naval and military forces is brought home to this country by the rude awakening which we have experienced; by numerous affronts to our neutral rights and repeated humiliations upon land and sea. The archives at Washington are overflowing with copies of fine-phrased diplomatic notes which apparently carry no weight with European belligerents because we are not prepared to enforce our just demands for the protection of American lives and commerce. Our citizens are murdered and the flag is insulted along the Mexican borders as the fruits of a "watchful waiting" policy and because we have not taken the admonitions of wise leaders to heart. Truly, the day has arrived when the resolute soul of a Washington should live again and cast out the white-plumed knights who would bend a servile back and make peace at any price. Surely, we must realize as never before that our security can no longer rest upon faith in political and geographical isolation—an armor which has proven fragile as tissue.

WHY BANKERS STAND FOR

"PREPAREDNESS"

As trustees of the savings and a large share of the wealth of the nation, the bankers have special cause to lend the weight of their influence for the adoption of national defense policies. There is proof of their earnestness and patriotic loyalty in the resolution adopted at the last annual convention of the American Bankers Association at Seattle, pledging "support to our several State Governments as well as to our National Government in all efforts to secure practical preparedness along the lines of National defense." At the recent banquet of New York City bankers the most enthusiastic endorsement was expressed to the plea of Secretary of War Garrison for the support of President Wilson's program. In fact, the bankers had taken an advanced position for "preparedness," long before the shadow of the European conflict brought us face to face with the vulnerable character of our defensive system.

The American banker realizes that these are times that strike deep into the vitals of every nation. It is impossible at this stage to conceive how far-reaching will be the influence of the war upon social, political and economic relations. So far as this country is concerned, the possibility of being drawn into actual hostilities is very remote. It is from the standpoint of future security, the protection and free exercise of American enterprise in foreign trade and finance, that we must take present conditions into strict account. Our newly-assumed and widely heralded role as a world power in finance and trade will be short-lived if Congress does not agree upon a program for an adequate navy and army. The opportunity to make our voice heard in the councils of the nations and to maintain a permanent foothold in the open markets of the world will pass away if the voters are remiss in pledging their hearty support to national defense at the coming presidential election. For the first time this country holds the blue ribbon in foreign trade and British economists are gravely discussing the possibility of the transfer of financial and commercial primacy to these shores. But there can be no permanent basis for our oversea expansion without a mercantile marine proportionate to our size and trade possibilities. Certainly, the nations now at war will redouble their efforts to

this connection that bankers are alive to the necessity of a larger army and navy if we aspire to hold strategic markets; if our newly established foreign credit and banking enterprise is to endure and prosper. If the American flag does not command due respect, our hopes of becoming a creditor instead of a debtor nation must be abandoned; our productive capacity and resources will be stultified, and the "American Dollar" will again have to yield to sterling or other mediums of exchange. As keen students of human nature, the bankers are not deluded by roseate dreams of universal disarmament or "world-peace" after the present conflict is decided. Whether the Allies or Teutons win it is easy to conceive that bitter hatreds and feuds will be nursed for generations to come, and that there may be even greater military and naval establishments than in the past.

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THE PECULIAR PSYCHOLOGY OF

AMERICAN BUSINESS AND

FINANCE

This country has become almost habituated to the thought that recurring periods of prosperity and depression, like the biblical seven fat and seven lean years, are unavoidable as phenomena of natural economic laws. Just now, on the threshold of another year, the armchair economists are engaged in wordy war as to whether the tide of our present prosperity has reached its crest. There is much talk as to "inflation" and the lack of permanent quality in

IS TO BE DETERMINED.