expect the new and greater expansion-that which will take full advantage of the tremendous capacity for springing ahead that was laid at the country's feet now many years ago by the adventurous pioneering of the railway trunk lines. Mexico is, in direct consequence of the silver standard, bare of the working capital she needs for her own development.

In spite of the palpable shutting off of the source of supply of banking funds, it has been claimed, and generally believed here, that the depreciation of the currency in terms of gold has stimulated mining, tropical agriculture and manufactures to such an extent that it is doubtful if the country is not on the whole richer and more prosperous than if the depreciation had never taken place. It can not be doubted that there has been a margin of protection afforded these branches of activity by the currency situation. Either actually or virtually the product of all three is sold in a gold market. The output of the mines and of the hot-country haciendas goes abroad, and that of the factories, being altogether insufficient to supply the home demand, is sold at prices which may be raised from time to time to meet the prices of the imports whose place it takes. The progressive lowering of wages as expressed in terms of gold thus gives a margin of profit so long as silver falls faster than the wage of skilled labor rises, a condition which has generally existed for a number of years, because even in the factories, where competition for skilled hands makes the labor-cost tend to rise as the prices of the manufactured articles go up, it is several years after a severe fall in silver has taken place before any perceptible effect is produced upon wages. The stimulation thus induced has, however, not been a healthy one, even from the standpoint of the industries in question, and it has been most baneful for the rest of the country.

The mines and tropical haciendas that are near established lines of transportation must be conceded to have made greater profits than they otherwise would. Mining and agriculture both, however, need abundant rail facilities. The grade of ore that can be worked depends directly upon freight rates, as does the class of farm product that can be cultivated. Consequently, although the few favored proprietors who already have trans

portation facilities may have been handsomely subsidized, there has been a deadening of the industries at large because of the dull discouragement imposed upon the building of railroads. The high rate of interest and scarcity of available capital has also conduced strongly to the same result, so much so that the selling out of the choice properties to foreigners is the very usual prelude to their real development. Even silver mining itself will probably receive a marked impetus after the abandonment of the silver standard from the increase in railroad facilities.

As to the manufactures, the protection on product received from the falling of the peso applies in equal degree against the machinery, supplies and fuel bought, as well as, in many instances, to the raw material used. Thus the monetary protection is not clean cut like that which could be obtained from a high protective tariff definitely adapted to the specific encouragement it was intended to furnish. The pressure under which the Government has been for funds, coupled with the fact that it is not possible to construct a tariff in silver which shall bear a constant relation to the value of articles priced in gold, has in some degree prevented the superimposing of as sharply protective a tariff upon this currency protection as could have been instituted under other conditions. The fact also that prices of imports and of the articles competing with them have become almost unbearably high to the silver standard purchaser has rendered the establishment of a thoroughly strong differential tariff a matter of extreme difficulty. It is, therefore, likely that the factories are not so well off as they would be if the currency were stable and the Government were free to put an adequate tariff on their products without the assistance of the fall in silver. The monetary protection, which compels the country at large and even the protected industries to pay a tax on twenty articles in order that one may be protected, and that, too, without yielding any revenue to the Government, certainly has its flaws.

From the standpoint of capital, taking the situation as a whole, the great drawback lies in the fact that the depreciation of silver with respect to gold has been very much more rapid than the depreciation of the peso as currency. If the price level and the wage level inside Mexico had kept even pace with the fall of

silver, it would still be possible to send gold there for general investment and expect a profitable return. It is precisely because the depreciation has been with reference to the international exchange rather than with respect to the use of silver as money within the country, that the financial isolation of Mexico, with its train of one-sided and undergrown development, has come into being. The uncertainty of the exchange rates of the future is the one great barrier that shuts out the needed stream of capital from abroad. It makes investments, even in the lines where the income is in gold, nothing more or less than gambling propositions. It means a great deal to a nation not to have its railroads, its industries, its banks, its trade, and its agriculture dependent for their success or failure on the skill of the proprietors in betting on silver futures, and there can be no doubt that stabilization of the exchange will inaugurate an era of swift and strong expansion, both on the part of existing enterprises, which at present stand on the footing furnished by the quagmire of silver speculation, and on the part of new enterprises, backed by the inflow of capital from abroad. The land is rich, it is young and undeveloped, its government is strong and liberal, there is a more progressive spirit abroad among the younger generation, so that development will be aided rather than hindered by the owners of the land. Nothing is lacking but reliable money before a magnificent structure of internal expansion will begin to rear itself on the solid foundation that the past quarter century has laid.

With the passing of centuries-old ways of employing money will come the gradual disuse of centuries-old ways of employing men. In a country where initial investments are perforce of niggardly proportions, direct manual labor must take the place of the indirect utilities of the outlay of capital. Men here are the draught animals, the beasts of burden, the machinery and fuel, even the implements of toil. Muscle is used in lieu of brain. The peon does not need to think in order to perform his task. He represents so much physical energy alone. The change of direction of the demand for labor, together with the increase of that demand, will have a strong tendency to set in motion a process of natural selection, and of growth by use as well, which will, with the lapse of time, bring the masses up to a higher

NOTES.

British Legislation in 1903. Forty-seven Acts of Parliament found their way on to the Statute Book as a result of the work of the session of Parliament which came to an end on the 14th of August. Of these acts, those of most interest to a wider public than that immediately affected are the Irish Land Act and the Education Act for London. Others of less interest, and yet not wholly local or particular in character, are the Sugar Convention Act, giving force to the recommendations of the Convention on Sugar Bounties, the Employment of Children Act, the Housing of the Working Classes Act, the Act for the Defence of Poor Prisoners, and the Motor Car Act. As a result of the war in South Africa, acts were passed providing for a Naval Reserve Force and Naval Volunteers, in order to increase the efficiency of the navy in case of war; to reorganize the Patriotic Fund, and to legalize the South African Loan and War Contribution. The budget, or Finance Act, also presented two interesting features, the remission of the corn duty, imposed as a war tax during the war with South Africa, and the reduction of the income tax from one shilling and threepence to elevenpence in the pound.

Among all these acts, the one which stands out as a permanent contribution to British statesmanship is the Irish Land Act. If the hopes centred on this act are realized, the Irish problem is a decisive step nearer solution, and in the future the political questions affecting Ireland may be dissociated from the unrest resulting from agrarian discontent.

An Irish Land Act is by no means a novelty. Mr. Wyndham told the House of Commons when he introduced his bill on the 26th of March, that there were already 40 or 42 on the Statute Books, beginning with Mr. Gladstone's famous act of 1881. These acts, however, fall into two classes-first those, headed by the act of 1881, fixing rents-determining the respective shares in the soil of landlord and of tenant; and second, those providing for purchase, which up to the present have been partial and tentative. The new act belongs to the second category, but is intended to be general and as far as possible exhaustive.

The first class of Irish Land Acts attempted the impossible, and have resulted in endless litigation and in the starving of the land.

Under the acts an Irish tenant may apply to have his rent fixed once in a term of fifteen years. There has been a second revision of many rents and these are known as second-term rents. Rents which have been judicially fixed only once are known as first-term rents. During the latter part of the term when a tenant is looking forward to revision, the temptation is to allow the holding to run down. Why should a man improve his land and bring out its full capabilities when his chief object is to get a reduction of his rent? In Ireland a landlord puts no capital into the land; all that he owns is the land itself. A tenant can easily make the intrinsic value of the land appear small in cases where, were the land his own, he could by a judicious expenditure vastly increase its productive power. The result of this partnership and this legal fixing of rents has been that agriculture-the staple industry, in most parts the only industry of Ireland has languished, and the country has been deprived of much potential wealth.

Another objection to the first series of Land Acts is the enormous expense which has been entailed on landlords and tenants by the legal proceedings necessary for the fixing of rents, and the friction. induced between classes by the necessary position of antagonism into which they have been forced. To the country, also, the cost has been heavy. The taxpayers of Great Britain and Ireland have paid £140,000 a year for the expenses of the Land Commission, which administers the acts and £1,400,000 as the cost of the police-police occupied almost exclusively with illegalities born of agrarian unrest. The second class of Land Acts includes the Land Purchase Acts. These acts have authorized the state to lend its credit to enable tenants to become owners of their holdings. Before the passage of the Act of 1903, 80,000 tenants had purchased under these Acts, and 73,000 had completed their purchases. Through these purchases the state has scarcely lost a penny. There have been but two irrecoverable debts, and these of inconsiderable amounts. In the first place the purchase money is secured on the value of the holdings, and secondly, what is more important as regards the prospect of success attending the new act, public opinion supports the punctual repayment of the purchase money and shows no sympathy towards the man who, having become the owner of his holding, fails through idleness or incompetence. The tenant having become the owner, has no further interest in starving the land, or depreciating its apparent value, but all his interest is in favor of improving it and getting the best and most permanent results from it.