PART ONE.

THE MERCANTILE PERIOD AND THE ABSOLUTE MONARCHY THE CANAL PROJECT A ROYAL

MONOPOLY. 1492-1815.

B

CHAPTER I.

THE DISCOVERY OF AMERICA.

§ 2. The Movement

of the World's Commerce.

ISHOP BERKELEY'S oft-quoted lines"Westward the course of Empires takes its way"-would seem to tell but half the story. From Asia successive waves of Aryan migra tion have, indeed, broken over the shores of both Europe and America, but just as each ocean breaker is followed immediately by an undertow movement sweeping back toward the centre of disturbance; so too have these waves of Western civilization been succeeded in each case by a return current of trade and commerce setting in toward the lands of the East. Thus, on the one hand, our advance has been steadily westward, through the European peninsulas to the Atlantic, over the seas to the New World, and across the American continent toward the countries

of the Orient; while, on the other hand, our easterly trade lines with Asia have all the while been multiplying in number and gaining in stability.

In our day the circle of the globe is all but completed. On the western shores of America, Canada and the United States now stand covetously regarding the neighboring islands of the Pacific. In the opposite direction the Suez canal has already brought the Europeans in close touch with their Asiatic colonies and dependencies, Africa has at last become circum-colonized, and Russia is even now busily engaged in establishing commercial connections with the Pacific through Siberia. The Oriental nations themselves, surrounded thus on every side, have begun to feel the impetus of this twofold movement of Western civilization, and are waking up at last to the demands of its economic life.

The construction of an interoceanic canal joining the waters of the Atlantic directly with those of the Pacific must, therefore, owing to the sphericity of the earth, merge these two great channels of trade into one. The course of the world's commerce will thus in the end assume a rotary motion, and commercial advance can then no longer be likened to the breakers of a rising tide with their back-rushing undertow currents, but rather to the waves of the deep-flowing sea itself, where no shore obstructs its

course.

Speaking generally it may be true enough to say that production is carried on in order to satisfy the ever-increasing wants of man. Since the institution

§ 12. The Forces

Back of this

Movement.

of reproductive capital, however, the immediate cause of western economic advance is rather to be found in that insatiable desire of gain that has ever since actuated those in control of the means of production. Such is the force which has gradually extended the zone of our commercial activity ever farther westward, and at the same time, bound the trade of Europe more and more closely to the lands of the East. This selfsame sociological factor has also long been operating upon the solution of the isthmian transit problem, whose history we have here to record and whose ultimate fulfilment we may confidently look for ward to.

of the Movement.

The owning classes of Greece and Rome secured their profits from the land by directing the labors of slaves. As the slave system is technically § 13. An far from productive, however, it could not Historical be relied upon to afford an indefinitely Retrospect increasing return, unless applied to an ever expanding area of land. Thus after the southern peninsulas of Europe had been more or less superficially exploited in this way, the rich countries of the East had perforce to be conquered and made to give up their wealth. With Rome as its centre, this twofold movement of trade and commerce came thus to include the British Isles on its westward advance, and the furthermost confines of Persia within its eastern connections. Competition among the several owners of Rome for the largest share in these profits of conquest, resulted at the same time

in the downfall of the smaller proprietors and the concentration of all the wealth thus acquired in the hands of the few. Individual initiative had no further outlet in consequence, and, after all available land had been taken up, the labor of rebellious slaves and the tribute of conquered peoples no longer sufficed to satisfy the growing demands of the Roman monopolists and support their idle clients. Diminishing returns set in, and not being able to support itself financially, the Empire was bound in the end to fall.

The barbarians of Northern Europe thereupon assumed control of the economic advance of the West. Still more strenuous conditions confronted them, however, and, in order to acquire any profits at all from such an environment, some more efficient system of production than slavery had necessarily to be evolved. Now the Roman proprietor owned not only the land but also the laborer himself, and was thus in a position to absorb the entire surplus value of industry. What was gained thus in profits was ultimately lost, however, in the energy of the actual producers. The feudal owners of the Middle Ages were obliged, therefore, to content themselves with control of the land alone, binding their serfs to the soil, it is true, but leaving them for the time, masters of their own personality. Additional productive energy was thus acquired, and from the land element at least, profits were still assured to the proprietary classes.

The continent now became the centre of economic

activity, and on the basis of serfdom the agricultural lands of Western Europe began to be redeemed. Coincident with this western advance, a back-draft also set in again toward the Orient. In order to gratify a growing demand for luxuries among the feudal lords, efforts came to be made at this time through the arms of the crusaders and their mercantile allies to reestablish trade connections with India; while travellers and Christian missionaries also penetrated into the very heart of the lands of the far East, where the liberal and magnificent Mongols now held sway. These first attempts were not altogether successful; for, by the time the proprietors of the West had really begun to feel the need of Oriental products, the ports of Asia Minor began one by one to be closed upon them by the Ottoman Turks, while the Tartar hordes of China, less hospitable than the Mongols whom they had overthrown, now shut them off by land. The merchants of Venice and Genoa, nevertheless, still managed to maintain an indirect and precarious trade with the East;-just enough, in fact, to keep the European appetite whetted for Oriental treasure.

As a result of this partial failure, articles of luxury had now for the most part to be produced at home. This was now possible, as the growth of her mediaval towns had already raised handicraft in Europe to the dignity of an independent calling. Serfdom soon proved itself utterly inadequate for work of this kind, as a high degree of individual initiative was here essential to immediate success. Feudal