Only in two ways, it is said: by establishing Manila as a free port; or by manufacturing for Asia on an Asiatic basis.

Make Manila a free port, it is said, and the United States will be in a position to claim its share in Asia's trade. How can this be? The example in mind is clearly Hong Kong, but the history of that island shows how it was favored by conditions not likely to be repeated. The striking fact about Hong Kong is that it was not China but the Chinese that made it possible and have made it what it is. For a long time it was a morgue spot: "the White Man's Grave," and an Alsatia, a place of refuge for the lawless or criminal, and its future was in doubt as late as 1848. Then came a series of events: the discovery of gold in Australia and California made the coolie trade profitable; the Taiping rebellion which drove men of property to the island for protection; the Suez canal and its effect on Eastern commerce; and the opportunities for work offered in the Malay Peninsula. From a struggling town no better than a mining camp in morals, it has become one of the great shipping centres of the world. "In the colony of Hong Kong," says Colquhoun, "most of the wealth is in the hands of the Chinese, and in all the chief business houses and financial institutions the Chinese hold positions of great responsibility."* For some years the commerce of Europe at Hong Kong has shown a tendency to decrease, a fact that can be explained only by the change in the direction of Asiatic commerce, by which the transactions are more and more among the peoples of Asia and less with the countries of Europe and America. Further, the over-sea commerce tends to become more direct, and the need of a port of deposit or for transshipments is less felt.

Nor geographically can it be said Manila offers any advantage to Asia's trade. There is already a great shipping station at Singapore, for the Indian commerce, and it is quite as convenient to steam from Singapore to Hong Kong, as it

*China in Transformation, 316.

would be to go to Manila and thence to Hong Kong, or any port of Asia. If the advantage of a free port is not to be had, the only alternative is to use the Philippines as a manufacturing base, for supplying the continent with certain manufactures, like low grade cotton cloths. Native labor, if available, and native cotton would be used, after the manner proposed by the French in Tonking. In that event the question of labor would again come to the front. Would an attempt be made to use the natives, or to bring coolies from China? The success of either would be problematical, against the establishment of mills in China itself.

As an agricultural colony the Philippines have their possibilities, for there is a natural monopoly in Manila hemp, and a capacity for all tropical growths. But the labor for the plantations, where is that to be had? Spain used the natives, but only under a system that ruined the planter and drove the laborer into rebellion. The methods purported to be in imitation of those adopted by the Dutch in Java. "The [Spanish] law prescribed that every native might plant tobacco, but might only sell it to the government. In the tobacco districts every native had to grow a certain number of plants and devote all his attention to them.” Here all similarity ended. The tobacco was sorted by the officials and the unfit burned. "For valuing the tobacco the officials used a scale, according to which the planter received some 20 to 30 per cent of the real value. But he was not paid in cash. He received a certificate, a kind of treasury bond. Had the people had security for the payment of these bonds at an early date, the latter would soon, no doubt, have come into currency as paper money. But, far from this being so, no one would have them, knowing that five or six years might pass before they were redeemed. The tobacco planters lived under more miserable conditions than the worse kept slaves, and were glad if some noble philanthropist would give them half the value of their certificates, for who could say whether the purchaser was

not risking his 50 per cent. Frequently the bonds were practically given away."*

Tobacco, hemp and sugar, these are the three leading products of the island, and all paid export duties under the Spanish rule. The tobacco finds no market in the United States; the sugar will be at a disadvantage with the Cuban and Hawaiian products, and must a find market in China; and hemp can not find an indefinitely increasing demand. There are minerals. The coal is of a quality that unfits it for transportation and must confine it to local use. Gold is reported, and copper is known to exist. Iron ore is abundant, but the lignites of the archipelago are said to be unsuitable for blast furnaces, and charcoal pig is the method suggested. The copper deposits were worked for a time, but were abandoned for want of labor. It is too sanguine a view to accept Mr. Tornow's view: "It is certain that the Philippines, whose future is already assured by their mineral wealth, will play a part in the industry of the coming years equal to, if not surpassing, that of Japan." Even if we accept his view it leads us to the conclusion that the commerce must be for Asia, not for the United States.

Another straw indicating the direction of trade winds. When Japan obtained possession of Formosa, a tariff of ten per cent ad valorem on imports went into operation. This increase, applying as it did to all imports from foreign countries fell as much on Chinese as on British cottons. Some compensation was expected from the privilege of free circulation of goods throughout the island. In the event Japanese and Chinese cloths have excluded all grades of foreign cloth coming in competition, leaving a much restricted demand for finer grades to be satisfied by Great Britain.

In Japan there are a million spindles now in operation, producing, 650,000 bales of cotton yarn of 400 lbs. each, of which more than 200,000 bales will be sent to China. In the needs of no other textile industry in Japan can the United States have

*Tornow, "The Philippine Islands."

George F. Becker of the U. S. Geological Survey.

a share either in the raw material or manufactured product. Silk is out of the question, wool is obtained from Australia and China, while woolens are cheaper in France, Germany or Great Britain than here. Flax and hemp are to be had from the Philippines, China and British India. Is it too much to look for an imitation of Russia's policy, which has sought to make that country independent of our fibre by developing the culture in Asia?

Is not this Asiatic commerce beset by a new difficulty offering a new problem of no little moment? Every port of size on the coast is in the hands or under the control of some European nation. We have set an example by declaring the Philippines open for ten years, and Mr. Reid assures us they will never be closed. What assurance have we that Continental Europe will maintain open ports in Asia? France in Tonking has been exclusive, and her coming policy is foreshadowed by her measures taken in Madagascar within a year. A decree gave a monopoly of the coasting trade to French vessels; it was promptly recalled, only because it was found the vessels flying the French flag were insufficient in number and tonnage for the needs of commerce. The application of the home tariff to the island, in itself a hardship to foreign merchants, was followed by a commercial campaign on the part of the "General Commander-in-Chief of the Corps of Occupation and the Governor-General of Madagascar and dependencies." "I have also to request you to instruct the native authorities," ran his circular, "to exert all their influence in favor of the objects at which we are aiming [to introduce French products]. It will be easy for them from the point of view now before us, to represent to persons living under their jurisdiction, that tissues of French manufacture are as good as similar articles manufactured abroad; that it is only fitting that the Malagasy, who have now become French subjects, should conform to our national customs by using our products; that their clothing thus becomes a distinctive mark of their new position, and that it should be made of

French tissues. But they must bear in mind that no obstacles should be placed in the way of the sale and circulation of foreign merchandise. Your part, as well as that of your native subordinates, consists simply in making clear to our new subjects the benefit to be derived by them from the purchase of French products, which will henceforward be more suitable to their habits and wants, which have been modified in the last two years by the introduction of French laws and customs. Such a course is absolutely within our right, and no one has any right to take exception to it." Further, the columns of the Malagasy journal (the Vaovao) were open to advertisements of French products, free of cost to the advertiser.* This found an echo in the French parliament. Introducing the debate on the colonies, March 6, 1899, M. Etienne said: "Surely France did not colonize for the benefit of foreign nations." As a result of this policy the exports of French cotton piece goods of all kinds to Madagascar rose from 690,400 francs value in 1897 to 5,512,000 francs in 1898. What reason to expect more liberal ideas in Tonking?

Another point must be considered. In order to raise the money necessary to pay the war indemnity to Japan, China mortgaged to the lenders the greater part of the receipts from customs revenue. It is generally known that the financial methods of China are not elastic, and favor a host of officials in the provinces rather than supply the imperial treasury. The land tax, which is the chief item in each provincial budget, is immutably fixed by law, and any attempt to increase it would lead to rebellion. As a monopoly the impost on salt has reached its limit, and it would be dangerous to make it heavier. Trade is, and has been the most reliable source of income, under the administration of a foreigner; but what is to happen when each port is under a different head, and competing with one another after the fashion peculiar to five rival governments? The "cohesive power of public plunder " makes itself felt under the *Circular No. 346, printed in the Journal Officiel, twenty-third April, 1898.