to prevent it will call for the nicest kind of diplomacy if the peace of Europe is to be preserved. As matters stand at present the Franco-phile attitude of Russia may act as a check on German designs; though the vacillations of Muscovite diplomacy stand in of any definite settlement of the difficulty.

the way

The United States has remained an interested but passive spectator of the situation in Europe. To be sure, the strength of our navy-which still ranks second only to that of Great Britain and our immense wealth would make us a highly desirable ally for one faction or the other; and, recognizing this, the Kaiser has long been doing everything in his power to win our friendship. He has showered favors upon Americans both here and in Germany; in 1902 he invited the President's daughter to christen his American-built yacht; he sent his brother, Prince Henry, on a visit to the United States; instituted exchange professorships between American and Prussian universities-has done everything, in fact, that he could do to earn our good will, and perhaps also to alienate our national affection for England. Yet he can scarcely be said to have succeeded; for though he has been most courteous and friendly in little things, his official representatives have ever opposed ours in matters of political and economic importance. In questions affecting such vital interests. as the tariff, the potash dispute, arbitration, disarmament, the Open Door in China, the rights of neutrals at sea, Germany and America have taken positions diametrically opposed to one another; whereas in all such discussions our representatives have worked along substantially the same lines as the English. And now, as if to put the finishing touch upon the Kaiser's discomfiture, we seem to be in a fair way to erecting the most colossal monument to international peace ever attempted-a categorical and binding arbitration treaty with England. This agreement will league together in sympathetic union all the English-speaking people of this earth, who control the destinies of one-third of the population of the world, and who have stood shoulder to shoulder for liberty and progress for the past one-hundred years.

The state of equilibrium in which the great Powers now find themselves will, in all probability, remain stable until 1915, when it will be disturbed, if not completely destroyed, by the

opening of the Panama Canal and the expiration by limitation of the Anglo-Japanese Treaty of Offence and Defence. The forces that will then tend to disturb the status quo will emanate from two sources, Japan and Germany. Furthermore, the altered position of the United States as a World Power must of necessity change her hitherto passive attitude toward her fellownations and compel her, however unwillingly, to assume the rôle of active participant in the political and economic struggle for

supremacy.

In the first place the Canal, by giving passage to our fleet from the Atlantic to the Pacific, will make us the dominant Power in the greatest of oceans. While our fleet is now, and probably for a long time will be, materially stronger than that of Japan, it is not great enough to admit of our maintaining a part of it in either ocean. Our reasons for keeping it constantly in the Atlantic are many, chief among them being the fact that we have neither the docking nor the coaling facilities on our western coast adequate for the proper maintenance of a large fleet of modern battleships. By the time the Canal is finished we hope to have brought the dockyard at Pearl Harbor, Hawaii, to such a state of efficiency that, in conjunction with the Mare Island and Bremerton Navy Yards (and to a lesser extent those at Cavite and Olongapo) we may be able to keep our fightingships in either sea, as the exigencies of the moment demand.

The question of fortifying the Canal, which lately promised to cause endless trouble and dispute, has fortunately been settled in Congress, and the work of erecting suitable forts and batteries at each end will soon begin. It is absolutely essential that these should be of such extent and completeness that they may effectually guard the Canal against any possible attack by a hostile fleet; further, the fixed works must be supplemented by a mobile force of soldiers adequate to protect both Canal and fortifications from a land attack. This will undoubtedly cost a great deal of money, but we dare not consider expense when such enormous interests are at stake; and the mere thought of the seizure of the waterway by a foreign Power, with the resultant crippling of our sea-strength, ought of itself to silence any opposition to the appropriations.

As auxiliaries to the defences of the Canal itself we must look to the protection of Hawaii, and the naval arsenal already mentioned; and on the Atlantic side we must develop Guantanamo, at the eastern end of Cuba, about 660 miles north of Colon. Guantanamo is the logical strategic outpost for the naval defence of the Canal. It is admirably suited by its location to guard all the approaches to the eastern end of the Isthmus, and it is imperative that we eventually convert it into a strong base for our fleet. Its topographical peculiarities are such that fortification would be easy, and its roadstead is more than ample for our needs. A great and efficient dockyard and repair-station should be erected there able to take care of several ships at a time, for Hawaii is too far away, and the nearest first-class navy yard on the Atlantic Coast (Norfolk) is about 2,000 miles from Colon.

While to some people it would look as if all this were an exorbitant price to pay for a Canal across the Isthmus joining North and South America, we must not lose sight of two salient facts. Firstly, the Canal will prove of inestimable value in the development of the Pacific Coast of both continents; and secondly, it would prove utterly ruinous to our growth and safety should it fall into the hands of some foreign Power. With a hostile flag flying over the Canal Zone and an enemy's fleet concentrated either at Colon or Panama (the cities at the termini of the waterway) our Gulf Coast and our western seaboard could not possibly be properly protected in the event of a state of war existing between us and any other Power. The Panama Strip is strategically as well as politically an integral part of our coastline, and, except perhaps economically, quite as important a part as New York or San Francisco.

It is by no means difficult to foresee what the effect will be on our Pacific States of the opening of the Canal to traffic. The expected great influx of immigrants from Europe into the sparsely-settled sections of California, Oregon and Washington will effect tremendous changes in economic conditions there; and it is perhaps not too much to hope that the present overcrowding of our Atlantic seaboard cities due to the huge tide of immigration from overpopulated Europe may be ar

rested by the diversion of the stream through the Canal to the Far West.

Another aspect of the changed conditions will lie in the commercial traffic which will be brought into being by the newlyopened trade route. Already a Japanese steamship company has signified its intention of establishing a line to New York. The Hamburg-Amerika Line not long ago acquired the Kosmos Line, a German Company operating steamships on the west coast of South America. These new enterprises will surely be followed by others, and if we Americans do not wish to see all the business monopolized by the alert merchants of aggressive Germany and Japan, we must bestir ourselves and urge upon Congress the necessity of affording relief from the intolerable conditions which at present hamper our deep-sea shipping trade and the growth of our merchant marine.

Both Germany and Japan use the same methods of fostering trade-cheap goods and cheap freights in subsidized ships; and England and the United States, unless they adopt similar methods, are likely to see what share they now possess in South American business taken from them by these two commercially militant nations. The trade of the northern half of the Pacific is already strongly dominated by the powerful steamship lines of the Mikado's subjects, and we may in all reasonableness expect to see the splendid new turbine liners of the Nippon Yusen Kaisha and the Toyo Kisen Kaisha invading the South Atlantic as soon as they can have access thereto without making the long detour around the Horn. And on the western coast the English and Americans will soon have to compete with the North German Lloyd and Hamburg-Amerika Lines, the two largest and among the best-managed ship-owning companies of the world. Successful competition will not be easy, for the wages paid to their crews by the Germans and Japanese are vastly lower than those paid on English vessels, and only from one-quarter to onehalf as much as American owners are compelled to pay to the complements of ships flying the Stars and Stripes.

So unless we come to our senses and by increased Government aid take steps to meet this impending competition, we may as well abandon the idea of holding our share of the fast-growing

trade of South America. And if it be in any wise true that trade follows the flag, just so surely will the flag tend to follow on the heels of trade. Both Japan and Germany feel the need of an outlet for their surplus population, and what were more natural than that they should try to found colonies in the temperate latitudes of South America? We have had plenty of warning examples of what would happen in a mercantile way should Japan and Germany succeed in forcing their sovereignty upon alien territory. Just as Korea, parts of Manchuria and the Kiao Tschiao Peninsula are shut to our trade by the stringent laws of Japanese and German rule, so also should we find those parts of South America closed to our exports and imports. The subjects of the Kaiser and the Mikado do not invite outside competition as do Englishmen, for they are not rich enough to be able to afford the luxury of free-for-all competition, and so are not in a position to do away with the selfish policy of exploiting newly-acquired possessions for the sole benefit of their own countrymen.

Of course there is one very serious obstacle in the way of Germany and Japan-the Monroe Doctrine, which states clearly that the United States cannot and will not allow any further acquisition of American territory by any European (or other foreign) Power. For years now the British Government has lent its approval to this dictum, and we may certainly expect a continuation of this line of conduct on her part. But such a doctrine is of no validity unless backed up by armed force-like a blockade, it will not be recognized by others unless it is unqualifiedly efficient. Now, in the absence of a strong navy we could not expect foreigners to respect the Monroe Doctrine, and so we must decide promptly and definitely whether we wish to withdraw ignominiously from a position we have held for ninety years or face the issue squarely and increase our navy to such dimensions as will make aggression on the part of others at least unprofitable, if not impossible. Again the question of expense; but we must either go forward, shouldering new responsibilities, or wither and die-such is the law of nations. Germany, infinitely poorer in population and wealth than ourselves, has chosen to spend immense sums on her navy, and we