mercial trickery is characteristic of all Japanese business men. There are business houses in Japan- many of them that meet their obligations as punctiliously, that maintain as high a standard of commercial honor, as the most reputable firms in the United States. But, unfortunately, these form only a small minority. It seems a thousand pities that the honest and farsighted business men of Japan, and the Japanese chambers of commerce and similar business organizations do not take energetic steps to discourage dishonesty in dealings with foreigners, if for no other reason than the effect that it would have on American public opinion. The series of conferences held last year in Tokyo, between a self-constituted delegation of American bankers and business men and a number of representative Japanese, offered a splendid opportunity for a candid discussion of this delicate and irritating question. If the Americans, instead of confining themselves to patriotic platitudes and hands-across-the-sea sentiments, had had the courage to tell the high-minded Japanese who were their hosts how objectionable such methods are to Americans, and what incalculable harm they are causing to JapaneseAmerican relations, it would have worked wonders in promoting a better mutual understanding.

Now, in spite of what I have said about the methods of a large section of the Japanese commercial class, I am convinced that the Japanese are, as a race, honest. Though pocket-picking is said to be on the increase in Japan, burglary and highway robbery are extremely rare, while the murders, shooting affrays, daylight robberies, and hold-ups which have become commonplaces in American cities are virtually unknown. I should feel as safe at midnight in the meanest street of a Japanese city as I should on Common

wealth Avenue in Boston - considerably safer, indeed, than I should on certain New York thoroughfares after nightfall. I asked an American woman who has lived for many years in Japan if she considered the Japanese dishonest. 'In Yokohama,' she replied, 'I never think of locking the doors or windows of my house, yet I have never had anything stolen. But when I was staying last winter at a fashionable hotel in New York, I was robbed of money, jewels, and clothing the night of my arrival.'

Nor could I discover any substantiation of the oft-repeated assertion that positions of trust in Japanese banks are held by Chinese. Certainly this is not true of Japanese-controlled institutions, such as the Yokohama Specie Bank, the Bank of Japan, and the Dai Ichi Ginko, as I can attest from personal observation. It is true that Chinese are employed in considerable numbers in fiduciary positions in the Japanese branches of foreign banks, such as the Hong Kong & Shanghai Banking Corporation and the Bank of India, Australia & New Zealand; but these have generally come over from China with the banks' European officials, their employment denoting no lack of faith in Japanese integrity. Yet such stories, spread broadcast by superficial and usually prejudiced observers, have helped to give Americans a totally erroneous impression of the Japanese.

My personal opinion is that commercial dishonesty in Japan is directly traceable to the contempt in which merchants were long held in that country. Until quite recent years the position of the merchant in Japan was analogous to that of the Jew in the Europe of the Middle Ages. He was at the bottom of the social scale. At the top was the noble; then came the samurai, or professional fighting man; followed in turn the farmer and the

artisan; and last of all came the merchant. The farmer and the artisan have always held a higher place than the merchant because they are producers, whereas the merchant has been looked upon as a huckster, a haggler, a bargainer, who made his living by his wits. The Japanese merchant, moreover, has had barely half a century in which to learn the game of business as it is played in the West. Coming from a despised and down-trodden class, is it any wonder that in that brief span he has not wholly eradicated his ancient methods, that he has not yet acquired all our Western virtues and ideals? Let us be fair in judging him. The Jew has been under the influence of the West for two thousand years, yet his business ethics are not always beyond reproach.

There is yet another reason for the doubtful business methods practised by many Japanese merchants. And that reason, curiously enough, was provided by ourselves. It was Kei Hara, Prime Minister of Japan, - himself a business man and the first commoner to hold the position of premier,-who brought this to my attention.

"You should not forget that my people learned what they know of modern business methods from you Americans,' he reminded me. 'It was your Commodore Perry who, in the face of Japanese opposition, opened Japan to American commerce. It was from the American traders who followed him that the Japanese received their first lessons in the business ethics of the West. The early American traders, in the methods they practised, provided the Japanese with anything but a laudable example. If they could cheat a Japanese, they considered it highly creditable; they took advantage of his ignorance by giving him inferior goods and by driving sharp bargains; they constantly bamboozled him. Is it any wonder, then, that the Japanese

merchant, patterning his methods on those pursued by the Americans, adopted American commercial trickery along with other things? But, mind you,' he added, 'I am not condoning commercial trickery among my people. I am only explaining it.'

IV

We now come to a consideration of the political factor in Japanese-American relations. In order to estimate this factor at its true importance, it is necessary to envisage the trying political situation in which Japan finds herself. Since their victory over the Russians in 1904 the Japanese have seen themselves gradually encircled by a ring of unsympathetic and suspicious, if not openly hostile peoples. Overshadowing the Island Empire on the north is the great bulk of Bolshevist Russia, still smarting from the memories of the Yalu River and Port Arthur, and bitterly resentful of Japan's military occupation of Eastern Siberia and Northern Sakhalin. Every patriotic Russian feels that Japan, in occupying these territories, has taken unfair advantage of Russia's temporary helplessness; he listens cynically to the protestations of the Japanese Government that it has occupied them merely in order to keep at arm's length the menace of Bolshevism, and that it will withdraw its troops as soon as a stable and friendly government is established in Russia.

To the west, the Koreans, though now officially Japanese subjects, are in a state of incipient revolt, to which they have been driven by the excesses of the Japanese military and the harshness of Japanese rule. To the southeast, China, huge and inert, loathes and fears her island neighbor, their common hatred of Japan being the one tie which binds the diverse elements of the Republic together. As a protest against

THERE is probably nothing related to government that is advocated more and practised less than economy. It is a theme that lends itself easily to discourse which rarely, if ever, materializes in action. The party that is out is always bewailing the extravagance and criminal wastefulness of the party that is in. And when the people show themselves credulous enough to entrust the critics with power, the only difference likely to be seen is in an increased extravagance and waste. The fervor of the promise is usually found to be in inverse ratio to the amount of performance that is vouchsafed.

There has never at any period been a greater demand, or a more alluring opportunity, for economy in government than in that period which began when the World War came to an end, November 11, 1918. Expenditure had never attained a higher peak. Our great wealth and the tremendous stake involved, which was nothing less than the freedom of nations and the continuance of civilization, had justified an expenditure colossal beyond all precedent.

It was not merely that all money that might be needed should be expended, but all money that might seem to be needed, even if in the end it should appear that it was wasted. A prudent government could take no chances of losing the war by spending too little, if any of the money that was saved might do good. Subject to the imperative demand for honesty, the resources of the country were all to be employed,

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if only they might be of use, even if, like so many shells that were fairly fired at the enemy and did not reach him, much of what was expended did not appear to have any influence upon the result.

The need of such vast expenditure came abruptly to an end on the day of the Armistice. It became then at once necessary that all the energy previously employed in spending should be devoted to saving. And when Congress was in session the following spring, and our soldiers had returned to this country and been disbanded; when our munition factories had ceased their operation, and employment was dwindling, and the mass of our people was beginning to feel the first keen pinches of excessive taxation, it became the paramount duty of Congress ruthlessly to cut expenditure to the bone. But to pass over the debatable transition period when deficiencies were to be met, and to make no exalted demand upon the first Congress after the war, surely 'normalcy' in expenditure must be indeed a coy creature if she cannot be prevailed upon to show herself by the Congress that emerged from the throes of the last presidential campaign, and convened nearly two years and a half after fighting had ceased. The expenditure of the present fiscal year should be little greater than the normal expenditure of the government, with the exceptions to which I shall hereafter refer. Not to show results at this time would be wholly without justification, and those results should not be

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expressed in a few coppers saved here and there, a paltry reward for so much eloquence about extravagance,

but should reach into billions.

At the end of the Civil War the South was impoverished and was an unfruitful field for the tax-gatherer. A fifth of the present population of the country was at the moment staggering under a burden of expenditure as great, when the difference in wealth is considered, as that which rested upon us after the World War. And yet the statesmen of that period resolutely cut down expenditure and taxation, attacked our enormous debt, and put it in process of extinction. We should do well now to imitate the spirit they then displayed.

At the beginning of the World War the operation of all the machinery of our government cost, in a round sum, a billion dollars. That this amount was not generally regarded as representing an economical basis may be inferred from what the leaders of each party said about the other when each party had in turn expended substantially a like sum. But as against this billion, we are told that, for the fiscal year which runs through the winter and well into the summer of the fourth year after the Armistice, four and a half billions are needed. There would appear to be little need of our having more government now than before the war; but granting that fifty per cent more government is necessary, an additional five hundred million dollars would be required, which is more than the total annual cost of the government under Cleveland. We should add to that the billion dollars necessary to pay the interest upon the war-debt; and then, to be generous, if not, indeed, extravagant, five hundred millions more may be added, to cover contingencies. We should then have a cool three billions, or three times the amount required just

before we entered the war. What need

- or, indeed, excuse is there for spending more than three billion dollars during the present fiscal year? But when four and a half billions are demanded, one may fairly ask whether the resources of statesmanship have been seriously employed, much less, exhausted.

Useless expenditure will attempt to fasten itself upon the treasury, and the life of the emergencies which make it necessary will be protracted by every art. But if it is attacked with resolution, it will yield.

An instance of this is shown in the reduction of our army. It was proposed to cut the army to 150,000 men, and a variety of objections was urged against the proposal. The one seeming to have the most merit was that contracts of enlistment had already been made, and the government would need to repudiate many of its contracts with its soldiers in order to make the reduction. But Congress, to its credit, insisted upon cutting down the army; and, almost before the bill had passed, the reduction was effected. The men were very willing to be released from their contracts.

To cut off a billion and a half of expenditure more than is now proposed would go far toward emancipating the productive energies of the country, and toward that revival of industry which is so necessary to the restoration of prosperity, and especially to the reëmployment of labor.

There is an intimate relation between the expenditure of government and what is called disarmament, in which Mr. Borah has so nobly led. A great saving of public money would undoubtedly result from putting in force an international agreement making a radical reduction in armaments; and no harm could come to any nation if the reduction were made proportional and world-wide. Very great items in mili