7. Defects of democratic government the world over. (Bryce, _Modern Democracies_, vol. ii, pages 452-454.)

8. The background of the problems of American democracy. (Merriam, _American Political Ideas_, chapter i.)

9. The hindrances to good citizenship. (Bryce, _Hindrances to Good Citizenship_.)

10. The promise of American life. (Croly, _The Promise of American Life,_ chapter i.)

11. Att.i.tude of the individual in a democracy. (Hughes, _Conditions of Progress in Democratic Government_.)

12. The power of ideals in American history. (Adams, _The Power of Ideals in American History_.)

13. Ideals of citizenship. (Woodburn and Moran, _The Citizen and the Republic_, chapter xx.)

14. The future of democracy. (Bryce, _Modern Democracies_, vol. ii, chapter lx.x.x.)

PART II--AMERICAN ECONOMIC PROBLEMS

A. ECONOMICS OF AMERICAN INDUSTRY

CHAPTER VI

THE NATURE OF AMERICAN INDUSTRY

52. MAGNITUDE OF AMERICAN INDUSTRY.--In colonial times the major part of American industry was concentrated along the Atlantic seaboard; to- day it extends over a large part of the continent. A century and a half ago our industrial system was still a relatively simple one, giving rise to few pressing problems of national importance; at the present time it is a vast and complicated affair, closely bound up with many of the most vital problems which confront American democracy. The activities which are commonly grouped under the head of "American industry" are so numerous and so varied that a description of all of them would carry us beyond the limits of this chapter.

Nevertheless, it is important that we secure some understanding of these activities. A few pages may profitably be spent, therefore, in discussing certain basic facts of American industry.

53. FAVORABLE LOCATION OF THE UNITED STATES.--Let us commence by noting that the location of the United States is favorable to the development of industry. Of the two American continents, the northern has the greater natural advantages. Each continent is roughly in the form of a triangle with the apex or smaller end pointing southward, but whereas the larger end of the South American triangle is within the tropic zone and only the tapering end is within the more favorable temperate zone, the greater part of the North American triangle is within the temperate zone. With regard to location for world trade the northern continent again has the advantage: the ports of South America face a relatively empty ocean on the west and the little-developed continent of Africa on the east; the ports of North America, in addition to being more numerous and more suitable for commerce than those of the southern continent, face the teeming Orient on the west, and the great markets of Europe on the east. Moreover, the United States occupies the choicest portions of the North American continent.

Our neighbor Canada has a cold and snow-bound frontier on her north, while on our south Mexico and the Central American countries lie near the tropics. The heart of temperate America, on the other hand, is included within the territory of the United States.

54. POPULATION.--Scarcely less important than the favorable location of the United States is the character of the people occupying the country. From less than four million in 1790, our population has increased so rapidly that in 1920 there were 105,710,620 people within the bounds of continental United States. As the population has increased, it has spread over the Appalachians, into the great Mississippi basin, and westward to the Pacific Ocean. Accompanying the increase and westward spread of the population has come a greater variety of racial types. Although our population was varied in colonial times, the great majority of the settlers were from the British Isles and northwestern Europe. In the latter part of the nineteenth century immigration from northern Europe declined and more and more immigrants began to come from southern and southeastern Europe. So universal has been the attraction of America, that our present population includes elements from every important country in the world. From the industrial standpoint, the dominant Characteristics of this composite American people are energy and versatility.

55. NATIONAL WEALTH.--Generations of industrious people have helped to make the United States the wealthiest nation in the world. It has been estimated that in 1850 our national wealth amounted to $8,000,000,000.

By 1900 the remarkable progress of American industry had increased this figure to more than $88,000,000,000. In 1912 our wealth was probably in excess of $180,000,000,000. Industrial and financial disturbances during the period of the World War make later estimates hazardous, nevertheless it is interesting to note that in 1921 the wealth of the United States was estimated as being between $350,000,000,000 and $400,000,000,000. According to this estimate, the wealth of this country exceeded, in 1921, the combined wealth of Great Britain, France, Germany, Italy, and Belgium. In weighing the value of this comparison, however, we must take into consideration the heavy destruction of wealth in western Europe because of the World War.

56. WHAT THE AMERICAN PEOPLE ARE DOING.--A large percentage of the inhabitants of the United States are engaged in some form of productive work. According to the most recent estimates there are approximately fifty million persons, male and female, over ten years of age, engaged in gainful occupations in this country. Of these about fourteen million are engaged in agriculture and allied industries, while more than eleven million are busy in manufacturing pursuits.

Almost four million are found in some form of trade, and another four million are employed in domestic and personal service. Transportation, clerical work, and professional callings utilize the services of several additional million. The great majority of those employed in American industry are men, although the number of women in industry is steadily increasing. Children have been found in industrial pursuits since colonial times, but of recent years there is a growing movement to restrict or prohibit the employment of children in gainful occupations.

57. FORESTS AND MINERALS.--The natural resources of the United States play a large part in our industrial life. One fourth of the territory of the United States is still covered with timber. We are abundantly supplied with coal and iron, the two most important industrial minerals. Our coal deposits outrank, both in quant.i.ty and in quality, those of any other country. Iron is found in most of the states in the Union, the high-grade deposits of the Lake Superior area being of special importance. We produce more than half of the world's supply of copper, which, after coal and iron, is the most important industrial mineral. Our supply of petroleum and natural gas is large, and in spite of the waste which has characterized our use of these important commodities, our production of both is still great. Gold, silver, zinc, lead and phosphates are produced in the United States in large quant.i.ties. Indeed, we have ample supplies of practically all of the minerals of importance to industry, except platinum, tin, and nickel.

58. AGRICULTURE.--Until very recently, at least, agriculture has been by far our most important industry. Of the two billion acres comprising continental United States, approximately half are under cultivation. In most sections of the country the quality of the soil is good, and rainfall is ample. We have long led the world in the value of farm crops grown. Our production of wheat, corn, oats, barley, rye, and dairy products totals an enormous figure. The steady enclosure of lands formerly used for grazing stock is restricting our production of food animals, but we are still important as a producer of meats. Most of the world's tobacco is grown in this country. The world's supply of cotton is derived mainly from southern United States. Finally, our soil is of such variety, and our climate so diversified, that the danger of a general crop failure is slight. A loss in one part of the country is almost certain to be offset by good crops in another.

59. MANUFACTURING.--In colonial times American manufactures were subjected to more or less restraint by Great Britain, but after the Revolution these industries entered upon a period of free and rapid development. Modern machinery was introduced rapidly after 1800, large scale production was developed, transportation was fostered, and larger and larger markets were supplied with the products of American manufacturers. Particularly since the Civil War has the importance of our manufactures increased. This increase has been due chiefly to the large scale production of foodstuffs, including meats and flour; textiles; iron and steel products; shoes; chemicals; and agricultural machinery. According to recent census figures it would appear that we are pa.s.sing from a predominantly agricultural life to a stage in which manufacturing is of relatively greater importance.

60. TRANSPORTATION AND COMMUNICATION.--The physical geography of the United States encourages the development of adequate means of transportation and communication. The St. Lawrence-Great Lakes system gives easy access to the most fertile section of the continent. The Mississippi and its tributaries drain a million square miles of farm land. We have, in addition to 18,000 miles of navigable rivers, a greater coast line available for commerce than has the whole of Europe. New York is the world's greatest seaport.

Few mountain ranges hamper the development of transcontinental railroads in this country, and of these only one, the Rockies, is a serious obstacle to effective transportation. Our railroad mileage is enormous, a half dozen transcontinental lines being supplemented by numerous smaller roads and feeding lines. We have more than 2000 miles of ca.n.a.ls in operation. Cheap and rapid transportation between the different parts of the country, supplemented by adequate means of communication by telephone, telegraph, and the postal service, undoubtedly has been one of the greatest factors in our national prosperity.

61. DOMESTIC AND FOREIGN TRADE.--The great majority of our products are not shipped to foreign markets, but are utilized within the country. We are still so young and so undeveloped a country that our manufacturers have been kept busy supplying the domestic market. This fact, together with the American manufacturer's lack of knowledge concerning the possibilities of foreign trade, explains our neglect of foreign markets. In proportion as our manufacturers catch up with the domestic market, and in proportion as their knowledge of foreign markets increases, it is likely that they will give more and more attention to customers in other countries.

But though a very small proportion of our products are sent abroad, the foreign trade of the United States exceeds in value the foreign trade of any other country. This predominance is due, not so much to our search for foreign markets, as to the steady demand in other countries for three cla.s.ses of goods in the production of which we have a distinct advantage. These three cla.s.ses of goods are, first, raw materials of which we have a great abundance, such as cotton and copper; second, specialties invented and patented by Americans, such as inexpensive automobiles, typewriters, and phonographs; and, third, commodities which may be advantageously produced by large-scale methods, such as agricultural machinery and the cheaper grades of textiles.

62. SUMMARY AND FORECAST.--We have very briefly surveyed some of the basic facts of American industry. On the one hand, the favorable location and the rich natural resources of the United States have furnished a substantial basis for industrial progress. On the other hand, we must note that the American people are energetic and versatile,--combining, to a happy degree, the qualities of initiative and originality, perseverance and adaptability. The great wealth and prosperity of the country as a whole have been the result of the combination of a favorable land and an able people.

This is not the whole of the story, of course. It must be admitted that, with all of our wealth, we continue to face serious charges of poverty and industrial maladjustment. These charges are of great importance, but it should be remembered that no problem can be solved, or even intelligently attacked, until the essential facts are well in hand. We have briefly described the nature of American industry. What we have now to do, as a preliminary to considering the problem of poverty and industrial reform, is to a.n.a.lyze the economic laws in accordance with which American industry has developed. The essential facts of the next four chapters cannot be weighed too carefully.

QUESTIONS ON THE TEXT

1. To what extent has the character of American industry changed in the last century and a half?

2. Compare North America with South America with respect to natural advantages.

3. Outline the changes which have occurred in the population of the United States since 1790.

4. Trace briefly the increase in our national wealth since 1850.

5. What are the chief occupations of the American people?

6. Name three important industrial minerals, and comment on our supply of each.

7. What are the chief characteristics of American agriculture?

8. Outline the growth of our manufacturing industries.

9. How are transportation and communication encouraged by the physical geography of the United States?

10. Why is our domestic trade of relatively greater importance than our foreign trade?

11. To what three types of goods is our predominance in foreign markets due?

12. What qualities of the American people have contributed to their industrial success?

REQUIRED READINGS

1. Williamson, _Readings in American Democracy,_ chapter vi.

Or all of the following:

2. Bishop and Keller, _Industry and Trade,_ chapters i and ii.

3. Bogart, _Economic History of the United States,_ chapter i.