By becoming commercially self-supporting is meant bringing in the products of the soil from other countries, selling to those countries in return the products of the mines and the indoor industries. The products of the indoor industries may themselves be made from imported raw materials. In this case we bring in raw materials, work them up into finished products, and sell them again to outside people, living ourselves upon the profits of the transaction. We virtually sell our labor to other nations. This method of building up a great population has such vast possibilities, provided we are so situated as to be able to do it, as to appeal powerfully to the imaginations of statesmen and nation builders If outside markets fail, then we must turn to the development of our own soil, for in that case we must become physically self-supporting. The pent-up versus the expanding type of civilization. Even though we aim to become physically self-supporting, we have two distinct lines of development open to us: one is to develop an oriental, or pent-up, type of civilization; the other is to develop an occidental, or expanding, type of civilization. By an oriental, or pent-up, type of civilization is meant a civilization in which we try to live on our existing area of land, and to support a growing population, without adding to our productive area. This leads to a gradually increasing intensity of cultivation and a gradual lowering of the standard of living of those who work on the soil, and eventually of the masses of the people. By an occidental, or expanding, type of civilization is meant a civilization in which the effort is made to maintain the standard of living and the product per man in a growing population by widening our cultivated area rather than by cultivating the original area more and more intensively. If we had been developing a pent-up civilization, we should never have spread, say, outside of the original thirteen states, but should have tried to support our increasing numbers by cultivating the soil more and more intensively. Indeed, we should probably not have left Europe in the first place, unless it were to escape persecution. We have preferred to expand over more land rather than to try to live on the original area, whatever that original area may have been. It is difficult to see where this tendency will lead us, but it is a rather striking fact that, from the Greeks down to the nations of the present, every great European nation has been a colonizing nation. Thus people have preferred to go where land was abundant rather than to stay where population was dense. Unless we change our habit very decidedly, we shall probably continue to do the same in the future; that is, we shall try to maintain our standard of living. When this cannot be achieved by intensive cultivation, we shall swarm, or send out colonists; that is, some people will emigrate. The only alternative would be the maintenance of a stationary population through birth control. The table on the following page shows, roughly, the area of land which it takes to produce, under fairly good agriculture, the food of a soldier for a year. This does not take into consideration the land necessary to clothe him or to feed the horses which are used to cultivate the land. If we assume that an average family of five persons will consume as much as three soldiers, we shall conclude that it takes nine acres to produce the food for a family. Under ordinary conditions it takes approximately five acres to produce the feed for a horse. According to the United States Census, in the great farming area of the upper Mississippi Valley there is one farm horse for every thirteen acres under cultivation. If, to be fairly liberal, one horse is sufficient to cultivate on the average fourteen acres, we might conclude that one horse could furnish the power necessary to cultivate enough land to grow the food for one family (nine acres) and for himself besides (five acres). The yields assumed in the above table are not unusually large, being about the same as those in England and other well-cultivated countries, but they are about twice the average yields in this and other new countries. One very important part of the problem of economizing land is that of preserving and improving its present fertility. This is to be done mainly by careful management of the soil. Crop rotation, a proper balance between plant growing and animal husbandry in order to supply natural manure, and an increased use of chemical fertilizers are the main parts of a policy of soil conservation. How important an item natural manure is in our national economy may be shown by the following facts: It has been conservatively estimated 2 that the value of the animal manure of the country exceeds two billion dollars ($2,225,700,000). This is greater than the combined value of all the mineral output and the entire timber cut of the country at the time the 1 Cf. "United States Army Regulations, 1913" (corrected to April 15, 1917), paragraph 1205, p. 240. Government Printing Office, Washington, 1917. 2 Farmers' Bulletin 192, p. 5, United States Department of Agriculture. estimate was made. If one third of this is wasted, it amounts to a sum much greater than the value of the entire timber cut of the country. Clearly the conservation of our animal manure is one of our greatest conservation problems.1 The increasing use of chemical fertilizers, however, is necessary if we are to make increasing drafts upon the soil in order to feed our increasing population. 1 "The Organization of a Rural Community," Yearbook of the United States Department of Agriculture, 1914. CHAPTER XIII CAPITAL What is capital? Capital has come to play a very important part in modern industry. This increase in importance has been so great as to lead to the impression that capital has come into existence only in recent times. That which is essentially capital has been in existence as long as tools have been in existence, but it has taken on a new and very distinct importance since the rise of machine production. As a factor in the modern economic system, capital may be defined as wealth, other than land, which is used by its owner to secure an income rather than for direct enjoyment. Land and other natural agents are usually treated as though they were in a class by themselves, and are carefully distinguished from the products of human industry and enterprise. These products of man's effort are subdivided, according to the uses to which they are put, into producers' goods and consumers' goods. Producers' goods include all tools, machines, buildings, appliances, and other forms of equipment which are used for the production of other goods; while consumers' goods, on the other hand, include only such goods as are used for direct enjoyment rather than for the purpose of producing other goods. Capital includes all producers' goods and some consumers' goods. It includes all producers' goods, because they are used for the purpose of increasing the owner's income. It also includes some consumers' goods, because some of these are used by their owners for the purpose of securing an income. A pleasure automobile, for example, which is let for hire is a consumers' good from the standpoint of society; that is, it is not used to produce other goods, but is used for direct enjoyment |