Evening Star Newspaper, August 18, 1929, Page 25

Part 2—8 Pages TARIFF BOOST HELD DEATH TO EXPORT TRADE GROWTH American Consumer Will Pay If Rates Raised, Harrison Says in Citing Adverse Effect on Fore BY SENATOR PAT HARRISON. HILE the country is swelter- ing in heat the finance com- mittee of the Senate has been wrestling with tariff schedules. If the Senate finally adopts the recommendations of that committee, there is every indica- tion that by the time Winter comes the American tonsumer will be forced, through inordinately increased tariff dutles, to wrestle with additional bur- dens entailed by a further increase in the cost of living. It is because of the high rates carried in the House tariff bill that foreign gov- ernments have filed protests with our Government unapproached, in numbers and in significance, in the consideration of any previous tariff proposal. These protests cannot be waved aside by the mere assertion that the tariff question | is a domestic question and that no other government may protest the right of the United States to impose such tariff du- ties as it sees fit. No one doubts our constitutional right to impose tariff du- ties. The increases do not present ?uestlom of right, but questions of pol- cy. of the policy to which I shall address vself, and not to its legality or con- stitutionality. Spirit of Bill Is Outlined. ‘We are confronted with & tariff pro- posal which fulfills the hopes of one of the members of the House ways and means committee who stated on the floor of the House that he would like to see a tariff “so high that the im- porters would break their necks trying to bring in goods over it.” It was in that spirit that the bill was framed and for that reason little wonder can be entertained that foreign govern- ments have voiced their protests. These protests have come from governments in every rt of the world and have been formally presented to our Depart- ment of State through diplomatic channels. It is quite true that in the consid- eration of other tariff bills there have been some protests, but never in the history of the country have the pro- tests been so universal or expressed in such vigorous language. The reasons for these protests are numerous and apparent, so much so that in the de- termination of the rates carried in the pending tariff proposals a most careful consideration must be given to them. Prosperity Hinges on Exports. The prosperity of the United States depends largely upan its ability to sell its surplus abroad. The genius of our people and the unrivaled natural re- sources of our country have resulted in such an output from our fields and factories as not only to supply the home market, but to afford a surplus for the markets of the world. In our early history that surplus came almost en- tirely from agricultural industries, but in recent years it has come in increas- ing proportion from manufacturing in- dustries. Through mass production methods many of our manufacturing industries today dominate the world trade. The cale of our growing surplus can be maintained only by creating a friendly feeling and " cultivating the good will of our foreign customers. In the long run we can sell to foreign countries those products and articles in which we have an advantage only if in turn we make it possible to buy from them those products and articles which we need, and in which they have an advantage. Only with such an interchange can the United States ob- tain the maximum of national pros- perity. Only with such an interchange can the American worker obtain the highest possible standard of living. Policy of U. S. Is Explained. It has long been the established | policy of this Government to assist American producers in finding markets for their surplus products, and in order to do so we have taxed the American people millions of dollars annually in the establishment of governmental agencies, such as consular agents and commercial and agricultural attaches, to study foreign markets and create atmosphere of ~nordial relationship which will promotz the expansion of our international trade and commerce. | Any movement, therefore, that will tend to disrupt or alter that long es-| tablished policy is of vital concern to the American people. { And what is the answer so frequently made by those who would bulld a tariff “so high that the importers would break thelr necks trying to bring in goods over it"? They say that similar argu- ments were employed when the Ford- ney-McCumber tariff law was under consideration in 1922, and they then cite the increase in revenue and in value of importations under the Ford- ney-McC\mber law as compared with the prece\ng law. This argument is ingenious, Nit not sound. An increase or decrease in importations may not be accepted as conclusive of the effect of tariff changes on our foreign trade. ‘We have a rapidly growing population; ‘we have intelligence, initiative and organizing ability; we have almost boundless natural resources. Becausa we have these things American .industries and American purchasing power, repre- sented by commodities produced, have naturally increased under every tariff Jaw. It is only normal, therefore, that the trend of imports should be upward even when handicapped by adverse tariff legislation. “Fairer” Method of Comparison. As the Fordney-McCumber tariff law increased duties to unnecessarily high levels, it inevitably affected imports ad- versely. The fact that under it the value of imports increased, as compared with imports of 1921, neither attests the reasonableness of the duties. nor proves ther not to have been injurious to our foreign trade. The year 1921 does not give a fair basis for com- parison. It was a period of depression following the post-war boom of 1919-20. Domestic production, imports and con- sumption were all lower in that year 4nzr in any other year since the end of the World War, It would be fairer to compare the proportion of domestic consumption supplied by imports since 1921 with the | here proportion supplied by them in the years immediately preceding the World War. If the higher level of prices, the wth of population and t.new}arntly gvereued per capita consumption of goods are taken into consideration, it seems improbable that in under the Fordney-McCumber tariff, total importations, free and dutiable, have formed a larger proportion of domestic consumption than they did from 1909 to 1913 under the Payne- Aldrich tariff. However that may be, it is certain that dutiable imports taken alone have formed & much smaller proportion of domestic consumption. As a matter of fact, most of the increase of imports aince 1921 has been in the free impor- tations of raw materials, such as rub- ber and silk_from tropical and Oriental countries. Under the Payne-. from 1909 to 1013, fres im. It is to the wisdom or narrowness | ign Commerce. ports formed 46 to 56 per cent of total |imports; under the present tariff they 1mve formed 58 to 66 per cent. In 11921 they formed 61 per cent; in 1926, | 66 per cent; in 1927, 64 per cent. Changes in Imports Cited. The change in the character and source of imports has had an impor- tant effect on the course of world trade. The best export markets, except in the neighboring countries of Canada, Mexi- co and Cuba, lle not in the regions from which we obtain free raw mate- rials, but in the European countries from which we mainly receive dutiable imports. The inability of those coun- tries to sell enough directly to the United States to pay for imports from | the United States has forced them to | seil to tropical countries, which in turn |sell to the United States. In other words, it has given rise to the triangu- lar trade of which much is frequently | made. Under a more moderate and reasonable tariff policy there is little doubt that to a very much larger ex- tent than now the imports from trop- fcal regions would be paid for by ex- ports to those regions, while to a much greater extent than now exports to Eu- ropean countries would be paid by direct imports from those countries. ‘The fact is that the growth of im- ports since 1921 has occurred despite and not because of the high duties im- posed by the act of 1922. Notwith- |standing their greater total value, dutiable imports now supply a smaller proportion of domestic consumption than they did in normal pre-war years, even in the years under the Payne- | Aldrich tariff law of unhappy memory. Increase in Purchasing Power. ‘The increase in value of imports which has occurred has been due to the increased purchasing power of the American people. which in turn has been due to the many factors which go to make American labor the most pro- ductive in the world. This productive- ness has given the United States a world dominance in many commodities despite a hampering tariff policy. The automobile industry is a fine example. It is estimated that American-made automobiles form 90 per cent of the automobiles of the world and 43 per cent of those in use outside of the United States and Canada. We domi- nate the world trade in automobiles. And this is true even though the tariff on automobiles is almost inoperative. 1t is merely a paper tariff. It is too recent for us to forget that because of certain inordinately high in- creases on certain goods and products from France that France only a few years ago increased her tariff against the importation of American automo- biles into that country. It presented a serious situation and only through the exercise of real diplomacy and statesmanship was a trade war with France averted. In the consideration of the question of increased imports since 1921 it can- not be forgotten that during the post- war years, owing to the economic domi- nance gained in the World War period, the purchasing power of the United States was and is now greater than that of any other country at any other riod of history. Its strong position been in marked contrast to the weak economic position of many of the European countries. Those countries not only have found it difficult to buy here the goods necessary for the well- being of their people and for the con- duct of their industries, but they have found it even more difficult to_fu!fill their financial obligations to the United States and its citizens. For this situ- ation our high tariff policy is largely responsible. Two Factors Held Main Reasons. If, despite this policy, European na- tions have continued to take our ex- ports in slightly larger volume, it is due largely to two factors. One is that our general economic condition not only has enabled us to import European goods notwithstanding the high prices entailed by exorbitant tariff duties, but has also enabled American tourists to spend millions of dollars annually in Europe. ‘The other factor is that we have continued to increase our foreign loans and finvestments. We have placed abroad some of the capital which under a tariff policy more favorable to foreign trade might have found use in our own export industries, for every dollar's worth of imports kept out by excessive duties makes it that much harder to expand those industries. - Because of such duties we have not gained the foreign markets which we might other- wise have gained. In consequence our export trade since 1921 does not appear to have kept pace with increasing domestic production. Capital which under other conditions might have remained here has been spent in building branch factories in foreign countries to supply markets for- merly supplied by the parent factories country. imposition of high tariff duties, with the curtailment of foreign trade which inevitably fol- lows, forcing American capital to go into foreign countries to manufacture and sell its products, is of vital concern to the American people and presents a problem which in time will invoke much discussion. The opportunity of enlarged foreign markets has been ours. It has captured the imagination of our holdest business spirits, and they have been prevented from taking full ad- vantage of it by the hobbling tariff policy of our Government. Rate Raises Called Selfish. One of the circumstances that have aroused the world against the pending tariff proposal is that the proposed in- | creases in dutles are not the result of |an impartial determination of facts or {of an intelligent consideration of the |efferts of the proposed rates on the buying capacity of the best customers and the chief debtors of the United | States. Instead the rates have been | granted at the behest in most instances |of selfish interests without regard to {the larger national and international interests involved. If the changes in rates had been determined upon the basis of equalizing of production and abroad, with due regard to that any foreign government would h‘snuumeg D plubly the most important example o!vtr:z way facts such as these have been ignored. We produce in the United States about one-fifth of our consum . For about half of our supply we are dependent uj Cuba, 'mwo “:Jm Wmm: of pmdu‘ cfi o oo el MRS an eported by a majority vote that a duty of only 1.23 cents a pound on Cthan e e e Zountsy B0 In Oa. produc G | Evén the two members of the commis- sion who did not mended suf | In the insular T EDITORIAL SECTION The Saunday Star, WASHINGTON, D. C, Disarmament and Peace More Talk of Friendship, Less of Arms, Will Unite English and American Viewpoints, Is Claim. BY VISCOUNTESS ASTOR, M. P. As Told to Meurig Evans. AM convinced that if peace is to come to the world it can be only by the Brit- ish Empire and America working to- gether. I do not see any other way out. Sometimes I get a little discouraged because it seems to me there are enough foolish people on both sides of the Atlantiz who are making quarrels. ‘When I hear some people in England talking about Amer!cg, lpll I can hope is that their talk will not be reported in that country, and when, on the other hand, I hear the way in which some Americans talk about Eng- land, I am equally sure their talk should not be reported here. The newspapers have an unfortunate habit of cabling from one country to an- other speeches of persons of no_ impor- Some one in the British House of Commons who is practically unknown in England will make a speech about America and it is immediately given a prominence in the American press entirely out of pro- tance. portion to its importance; and thing happens on the other side. got to remember that good news for the press is generally bad news for the public. That is the people’s own fault, for they would rather read about the misdemean- ors of their neighbors than of their vir- Our ears prick up immediately we hear some one has done something really disreputable, but we are less ready to be interested in the good work some one else tues. has done. Always Fatal to Talk Arms. The whole trouble in Anglo-American relations in the last few years has arisen from the fact that the two peoples, instead of talking about world problems, have talked about armaments. It is almost al- ways fatal to talk about armaments, be- cause when you talk about armaments you sinevitably talk about what is to Why Some Banks Crash Whole Financial Structure of Country Stronger Than Ever, Despite Troubles Here and There. BY CHARLES W. COLLINS, Former Deputy Controller of the Currency; Bratter "of the Nationai Budset Act al nd the McFadden Bank Act. OW does it happen that nearly | six thousand banks have failed in the United States during the last eight years? These have been years of great prosperity and business expansion throughout the | country. There have been no panics | and no lack of credit for business enter- | prises. Our factories have been produc- ing in greater capacity than ever before. | In fact. it is within this period that | we have witnessed the amazing de- velopement of what is known as mass production of and commodities. | ‘We shall look back upon these years as the beginning of the era of our| world-wide entry into the field of foreign commerce, alongside of an un- precedented domestic consumption of manufactured goods. The general stan- dard of living of the rank and file of sur people has been raised to the highest point in our history. It would there- fore be the normal expectation that our banks in general reflect this high level of business prosperity and social com- fort. That such is not the case is an indication that something is fundamen- tally wrong with our system of 8. 1t should be pointed out at the out- set that there has not been in recent ears a single failure of a large city k of the ty&e known as metropolitan banks. (The City Trust Co. and Clarke Bros., & private bank, are not classed as metropolitan banks.) We must, therefore, direct our attention to the banks operating with smaller capital funds and situated outside of the prin- cipal commercial centers. There were in the\United States in 192] about 31,000 banks—8,000 national banks and 23,000 State banks. This number has been reduced today to less than 26,000 —about 7,500 national banks and about 18,400 State banks. About one-fifth of the banks in existence in 1921 have faileC, this being at the rate of nearly three failures for every working day during the last eight years. Bank Failure’s Meaning. ‘What is the meaning of a bank fail- ure? Under our traditional system of banking every local community had one or more banks to serve that community. A natfonal bank can be organized upon $25,000 capital, and in many States banks can’ be upon capital as low as $15,000. Comparing the purchas ing power of the dollar with the pre- war standard we have, in effect, banks capital of less than Our people have been educated to think that the banks are the strongest business institutions. In the old doubt was true, and a bank comm! was something happen if and when come. Great Britain. the t; the same give it the victo: We have remember that even neighbor! In fact, VISCOUNTESS ASTOR. each side begins to assume that war will No sane person, either in the United States or in Great Britain, thinks that war is possible or conceivable at present_bctween the United States and Yet directly the navy comes into discussicn, each side begins to think what its position would be should break out, and therefore demands ypes of guns or ships which would in the event of the war. I feel intensely that if the people of various countries would stop talking about disarmament there would be more chance of a lasting peace, for when you are talk- ing about disarmament you are talking in terms of war. There would be no need at all for armaments if you did not think there was a likelihood of war. defense for yourself they are also an offense to your neighbor; but, while you may be playing for security yourself, yon are putting terror into other people's hearts. The whole world is suffering from the complex of security, yet it is perfectly obvious that if you try to get security by means of armaments you can get it not merely by big armaments, but only by having bigger armaments than your secure. inevitable I do not know whether men will always go on talking about armaments, but I am perfectly convinced that women going to do so and are not going their menfolk to do so, either. a secure empire and a secure world, and we are going to get it. see ever more clearly that patriotism to- ward one We have war comes. And s0 { war oowerful is in the And so it can only during th You must if armaments are a for Great about all about If they of guns, no nation can be secure except by making its neighbor in- Drawn for The Sunday Star by J. Scott Willlams. the par value of the stock but also for 100 per cent additional lability. In other words, the owner of $1,000 worth (at par value) of national bank stoek is liable to the depositors, in case of a failure of the bank, for the sum of $2,000. This is known as the double liability. When, therefore, a bank fails in a local ccmmunity, not only do the depositors suffer, but the additional burden upon the stockholders is often staggering. As an 1illustration of this aspect of bank failures, the case may be taken of a certain widow living on a small farm in Georgia who saw an advertise- ment that some stock of a nearby na- tional bank was for sale. She had, by virtue of years of self-denial, accumu- lated about $1,100, which constituted her sole fortune. She drove 11 miles through the country to the bank and invested her entire sum in 10 shares of the stock of that bank. Not many days later the bank failed. She made a frantic appeal to the United States Government to help her ™ get_her money back. She received the reply—and it was the ol that could be given—that lose the amount of money invested by her in the stock but also that she was liable for an additional $1,000. $2,000,000,000 Tied Up. And what about the itor who, of small banks in the rural communities is itself an indication that this tre- mendous total is made up of small de- posits. On the economic side it is rep- resented by the winding up of failed in- stitutions by receivers. But on the hu- man side—a side which cannot be shown in the Government statistics— there are tens of thousands of wrecked fortunes, thwarted business ambitions and broken heakts. No one can reduce to statistical form the social setback, the lawsuits, the suicides and the gen- eral loss of confidence in banking in those communities which have suffered bank failures. In most discussions of our banking system, including the question of bank failures, the primary question has been one of profit and loss on the part of the local bank. It has bean a discussion be- tween bankers for bankers. It has bzen an expression of banking opinion. This is natural because bankers are organ- ized and have the means of giving voice ns. The public, which is nnougu bank failures, nly reply not only would she | 1 18, ¢ ot | tems, To try to get security by arma- ments, therefore, is simply to make war greater and better than. that. peace depends on each country seeing what is best in its neighbors. People Dislike Rich Neighbors. ‘There is no getting away from the fact that America is going to be the richest and one of the most powerful countries in the world. People do not love rich and that people will love America much. She Britain was in during the nineteenth cen- tury, when all the world regarded Great Britain as the richest and most powerful country, but the world did not love her. The common-scnse thing, therefore, is to think less about armaments and more about friendship. They are really agreed world, about liberty, peace. things and less about the size and number that, instead of there being reason for quarreling, there was every reason for co- operating in world affairs. Another e science and ;nven'thlgn. which has made SUNDAY MORNING, AUGUST 18, 1929. e noy allow We want As I grow older I 's country is not nearly enough. got to have something far Werld neighbors, so I do not expect same position now that Great is with America today. If she keep her head as Britain did e last century the world is safe. Britain and the United States the important things in the about democracy, would think more about these they would very soon discover (Copyright. 1929.) ago the blame was placed upon the | three years' drought and upon ‘the de- | cline in the market value of live stock. ! When the same thing happened a little | later in the corn belt and in the wheat | belt again there were droughts, high | winds and declines in the market value of wheat, corn and land. Failures of a Jarge number of banks in the cotton [ belt have been attributed to the boll weevil and droughts. The failure-of a number of banks in Florida just a few weeks ago was attributed to the rav- ages of the Mediterranean fruit fly. | Scattered through all sections of the country, isolated failures have been a tributed to the criminal acts of bank officers, such as forgeries, defalcations, abstractions and embezzlements. There are known to science two | classes of causes, namely, proximate | causes and ultimate causes. The proxi- | mate ause is known as the immedia cause and the ultimate cause is known as the basic cause. For example, if several persons are shot as a result of chuc‘en playing with firearms in the street, the proximate cause of the in- jury is a gunshot wound, and that would be as far as the medical diagnosis would go. But the ultimate cause of the injury is a defect in the social sys- tem which permits children to play with firearms in the street. Now let us apply this doctrine to the banking situation. - The receiver of a failed bank, in making his report of the cause of failure, confines himself to the prox- llen in the cattle country & few years causes. - ing to study the ultimate or the besic cause of failure. ¥ 75 Per Cent Rural. Outside of a few isolated cases of bank failures in the large cities, such 2s the recent failure of a trust com- pany and of a private bank in New York City, the bank failure question is related almost entirely to the rural communities. Of the nearly 6,000 bank failures previously referred to, it is safe to say that 75 per cent were sit- uated in towns of less than 5,000 pop- ulation. Some of these banks were old institutions intimately associated- with the history and development of the local community. Around the founders of these banks many of these com- munities grew up. The banker became the most prominent citizen and his in- stitution was vitally interested in every type of local business enterprise. The basic cause for the failure of the small banks outside of the great commercial, metrogolitan cities is the fact that rural 1if€ in America within the past three decades has a social and economic revolution h has made our system of banking a t in the nization of our n: misfit in orgal fatots with world currents. factor may be attributed fo it possible for average . country home to emjoy the comforts and con- veniences which in past years could be tric lights, electric power. water sys. telephones, the radio, and, ,Purpue of the in same local iron works and the local carriage had only by the city dwellers. nee-"me MAGYAR MINORITY ISSUE ' KEEPS EUROPE IN TURMOIL Barbed Wire Fences on Frontiers In- crease Troubles Blamed Upon Hungarians, b e 4 P e e BY FRANK H. STMONDS. RECENT frontier incident be- tween Czechoslovakia and Hun- gary, following rather closely upon formal protests of the mininsters Entente nations at Budapest—protests mvouu by the speech of the Magyar | 'mier, Count Bethlen—has served to emphasize once more the unchanging arians to regain at least a portion -of territory lost in the treaty of Trianon and the menace this resolution constitutes for the tran- quillity, #f not the peace, of South- eastern Europe. Indeed looking to -the future, one can fairly say that the two apparently insoluble problems of peace in Europe are supplied by the Polizh c&nlmr and the Magyar minority ques- | tions. | The question of the Magyar minori- ties naturally falls into two divisions. ‘There is, first, the extreme nationalistic and almost mystic faith of a portion of | the Hungarian population in the even- | tual restoration of the old frontiers of | 1914, and thus the reintegration of the Crown of St. Stephen and of the state that had celebrated the thousandth an- | neversary of its attainment of national unity before the nineteenth century closed. By contrast there is the uni- versal demand of the whole people that | the existing boundaries shall be modi fled to permit the inclusion of rela-| tively large groups of Magyars living | Jjust across the new frontiers. One is bound to recognize that the | possibility of the realization of the first | of these aspirations is slight. The | Hungary of 1914 was a state of some 22,000,000 people, and in this number | the 10,000.000 Magyars were an abso- lute minority. That any violent, much | less any peaceful, transformation could | bring back the millions of Rumanians, Slovaks, Croats and Serbs to their for- | mer status as subject races is actually incredible. And responsibility for this | impossibility must be charged primarily against the Hungarians themselves, who in their period of ascendancy endeav- ored by a process of violent assimila- tion to Magyarize their minorities. Justice in Program. When, however, one examines the | second of the programs it is clear that | it is founded uron Justice, and were it possible to realize it peacefully would certainly contribute to improving con- ditions in the Danubian area. Thus, | while the peace settlement deprived | Hungary of not less than a third of its | Magyar population, at least half of the 3,000,000 and more of the old ruling | race could be brought back to the sov- creignty they prefer at the cost of no | more than relatively slight boundary | rectifications. It is, too. beyond any doubt that Hungary, mutilated in the name of self- determination, was alike the victim of her own domestic political conditions and of the extreme and unwarranted cleims of her neighbors. While the Eerbs and Rumanians, as allies of the opponents of the central powers, were able even during the war to establish political claims to Hungarian territory to which their ethnic title was invalid, Me Czechoslovaks through the skillful diplomacy of Masaryk and Benes in al- lied capitals were equally successful. At the Pans peace conference allied fesling still ran high against both thc German and Magyar elements, which | had been the ruling races in the old| Hapsburg monarchy and as such were | held responsible for the war. But to this cause for anger Hungary added a new offense when, during the actual sitting - of the Paris conference, the Carolyi government surrendered to Bela Kun, who was himself an agent and follower of Moscow. At that moment the statesmen who were in control at Paris were fearful of Soviet triumph everywhere east of the Rhine and north of the Alps and the Hungarian episode bulked large in their eyes. Hungary Is Deprived. *As & consequence the Rumanian army was permitted to occupy Budapest and the treaty of Trianon paid scant heed not merely to the aneient boun- daries of the Hungarian state, but also to an exact application of the principle of self-determination in mazing the new frontiers. Hungary was thus deprived. to the profit of Czechoslovakia, Jugo- slavia and Rumania, of very considera- ble areas in which the population was unmistakably Magyar. And today it must be agreed that any equitable divi- sion would have reduced the Magyar minorities abroad by substantially half. As to Transylvania proper, Croatia and the districts south of the Drav, there can be no real debate. Although in all there are considerable Magyar minorities, as there are also influential German factions in the first named, Latin or Slav majorities are decisive. On the other hand, all' around the periphery of contemporary Hungary are regions not only purely Magyar in pop- ulation but others in which there is a mixture of races. Since any possible line was bound to establish minorities it was a counsel not of perfecpion but of ordinary justice that the attempt should be made to establish a balance between the two minorities. Harsh Separations. . Instead, Rumania, Serbia and Czecho- slovakia were first permitted to extend their frontiers to and even beyond the outermost limit of their several linguis- tic areas and then to take still more territory, where it was desirable, because of strategic reasons or because of lines of communication both by river and by rail. Thus while more than 3,000,000 Magyars were cut off from Hungary, the new Hungarian state contained less than half a million Serbs, Rumanians and Slovaks. From the purely economic point of view this transformation of Hungary tances and made the cities themselves available to those who formerly lived in rural isolation. Alongside of these developments there has been a steady and widespread movement toward the concentration of business into larger and s groups, resulting in an increased out- put at a lower cost and & better qual- ity to the consumer. This is true now of nearly et ness and usually takes the form of & strong central management with branches’ or offices scattéred gh- out the world. ‘The local gas plant, the local electric plant, the local ice plant, the local tele- }’h““ company and many other such ocal _enterprises have: about disap- peared. The local drug store, the local store, the local cigar store, the to_be maker now express themselves through the great automoblile industries and the modern steél companies. ‘The economic effect of this develop- ment upon the smaller cities and towns has been of tremendous ce. but more important than all ers, the automobile, have al the oth- | trol bolished dis- form of general busi- | d vas unforfunate, since It constftutz2 = natural unit, but the actual wholesale | mutilation ‘was equally _inconsistent | with the principle of self-determination | professed in the fourteen points and the of all three Little Ordinary requirements of a common sense economic adjustment. All along the new frontier, but just across it, were the considerable cities of the old king- dom, cities which like Komaron, al- though wholly Magyar in population, were cut in half by the new frontier and isolated by barbed wire entangle- ments. Not infrequently men desiring to go from their home to their places of work were obliged to have ports and subjected to endless delay. The re- sult has been double, great suffering among all and eventual emigration by many. which has raised a serious prob- lem within Hungary. Extent of Blunder. Slowly the western nations have be- come aware of the extent of the Hun- garian blunder. This process of educa- tion has becn hampered and delayed by the intransigeance of the extreme na- tionalist in Hungary itself and by the clear perception in all capitals that for the present at least no revision of fron- tlers was possible save as a consequence of a new war, which would inevitably ravage the whole Danubian area and might extend west and north. Even the possibi'ity that the Czechs might make concessions in accordance with the known wish of Masaryk were de- stroyed when a Slovak = spokesman, Osusky, the Czechoslovak Minister at Paris, pronounced against the surren- der of a single inch of territory. It is clear. however, that Europe cannot afford to have Hungary become & permanent peril to peace and the center of any future intrigue in Eastern Europe. Nor is it less plain that at the | bottom there is no question as to the justice of a portion of the Magyar de- mands and a total unlikelihood that this proud people will permanently ac- cept its present status. Already the temporary success of Mussolini, in making Budapest a stepping stone in his anti-French system in the Danublan and Balkan areas, has awakened anxi- ety in Paris, while in London there sur- vives the old pre-war sympathy for a people which has always admired, iiked and imitated British customs. Again it is becoming more and more clear that Germany purposes both in the League and out to champion the cause of the minorities, as it plans eventually to achieve the union of Austria with the Reich. Thus, while the Hungarians have never liked the | Germans and today hold them respon- sible for the present misfortunes of Hungary, the German association may |again appear to Magyar statesmanship the sole means of escape from a situa- tion at once intolerable and beyond the resources of Hungary alone to modify. Effect of New Alliance. But a new ailiance of Germany, Aus- tria and Hungary, with the practical certainty that such an alliance would | again enlist the support of the Bul- garians, equally determined to obtain a revision of their frontiers, would mean the restoration of the old con- dition in Central Europe and ‘would in fact threaten the revival of the peril of Mitteleuropa, conjured only by allied victory. Relatively small as Hungary is, it nevertheless occupies a strategic posi- tion and must command a hearing in Europe. That a considerable part of its program is founded on justice and can be maintained in reason, however inconvenient and even dangerous, adds to the gravity of the situation. Like Germany, Hungary is today powerless, and, unlike Germany, it can never hope to achieve its ends by its own resources. But until it is reconciled to some sys- tem of order, it can, as it now does, block any definitive pacification of the Danube area and any restoration of economic_as well as political peace. And while Hungarian patriots have in the past been notoriously unreason- able, there are clear signs of the de- velopment of a more reasonable spirit. There is a mounting feeling of hope, based on an exaggerated ccnviction that the world is beginning to see the justice of the Magyar case. Unhap- pily, while there is & growing appre=- ciation of the Hungarian facts and a similarly increasing perception of the need of a modification of the Treaty of ‘Trianon among all the great powers, the determination of all the states that hold Hungarian minorities to resist change is also hardening. And these states are not only closely allied but are possessed of great military re- sources and strengthened by the fact that their support is necessary to the success of French policy in Europs and the maintenance of French influence in the League of Nations. (Copyright, 1920.) Wales’ Speech Inspires British Trade Tours Business tours in the dominions and the United States are becoming quite & popular way of combining slghtseeing with the cultivation of commercial “contacts.” There is a special interest in the visit to Canada which a party of members of the British Sales Man- agers’ Association have arranged for September. This seems to be the direct outcome of the Prince of Wales' famous Guildhall speech, in which he talked some sound sense about the need of im- proving our salesmanship. This expert body of salesmen has taken his words to heart and they intend to visit Mon- treal, Toronto, Winnipeg and other centers, making “a real, vigorous, in- tensive study of conditions and oppor- tunities in Canada.” They will confer on the technique of salesmanship with the heads of the large distributing firms and representatives of big business in- terests generally. Sir Arthur Balfour, who was chairman of the committee on industry which produced in its reports & whole library of valuable information and rews, has just returned from Canada. He has expressed the lon that the personal touch which such lelegations make possible is really of the utmost importance in the channels of British export trade. Photo of Wfim—on Popular in Canada Most popular of the British and hise torical portraits being placed in Cans adian schools by the Imperial Order Daughters of the Empire are those of the royal family and especially of the Pnnceolw‘;nle:ii:dwummdnlglhzre- on na he order’s convention. Great progress was made throughout the Dominion with the order’s policy of pl these pletures, library seis of varying d e ine, el o 2 e s n e s ‘where they are needed most.