cans are wasteful and extravagant; that a certain restlessness absorbs too much of our energy; that our sense of discipline is weak; that we neither respect nor reward political leadership; that outside a few industries we have little highly skilled labor; that despite the activities of the Shipping Board we have not yet worked out any plan for an American merchant marine to enter into competition with other commercial nations for carrying the world's trade; that the administration of government, however admirable this system of government may be in theory, has, especially in these last few years of chaotic upheaval, become slipshod and incompetent; that our system of education, much as it has been improved of late years, is still inadequately responsive to the needs of the country; and that our immigration laws have allowed Europe to send us, together with millions of excellent citizens, altogether too large a proportion of its own undesirables.

Approaching the question of what we must do to utilize to the utmost our advantages and to overcome our surmountable disadvantages, our first objective is to reach a clear understanding of the fundamental facts which underlie the conditions with which we have to contend abroad. Foremost among them is the great difference between the standard of living in the United States and in Europe. We must maintain our standard of living in order thereby to maintain the high standard of our citizenship-this is a supreme political necessity.

The general standard of living in Europe is distinctly lower than that in the United States owing to various reasons, and this lower standard produces some striking results. The high standard in this country comes naturally from our vast natural resources with a relatively small population which possesses a relatively high indus

trial intelligence. Our farmers almost invariably comment on the difficulty, not to say impossibility, of securing immigrant laborers who can handle horses or especially who can use farm machinery to any advantage as compared with our American-born workmen; and note our farms compared with Europe's small peasant holdings. The low standards of Europe and the accompanying low purchasing power of the consumers-mainly wage earners—result much sooner than with us in surplus production in many lines which must be exported to meet the imperative need for goods, largely raw materials, not produced in sufficient quantities at home. This early necessity for foreign markets brings about keen competition from other nations in those markets, which holds prices down and is a powerful factor in keeping down wages and standards of living.

Against these handicaps, the standards of living in Europe before the war had steadily risen; but even in Germany, with her highly intelligent vocational training and government favors to exporters which enabled her to enter many British markets, the improvement in standards did not equal that in the United States. The intensity of this drive for their foreign trade as compared with our great advantage in our unrivalled home market and superior resources and industrial skill have always kept Europe's need for cheap production cost so intense that it has always compelled relatively low wages, and has held their standards of living, though improving, still far below ours and not keeping pace with ours.

The situation in Europe has called for two methods of action: first, each country has been forced to find markets for its goods in countries of higher purchasing power than its own; and second, each country has had to develop markets in foreign countries of low purchasing power.

The former represents a qualitative expansion of business in the more costly products, the latter a quantitative expansion of business in the cheaper goods. These elements-cheap labor, low standard of living, surplus production, the search for markets, coupled with the vaulting ambitions of a domineering autocracy, have engendered bitter commercial rivalry.

This leads to another important consideration. The chance of keeping the world at peace for any considerable period depends ultimately upon whether or not the nations are willing and able to improve the living conditions of their people. It is not too much to say that the surest guarantee of peace is general prosperity, and that the discontent of extreme poverty at times breeds a state of desperation in which any prospect of change, even through the agency of war, can be made to bear the aspect of hope. Where this desperation is firmly controlled by statesmen it sometimes leads to a foreign war,-where it is uncontrolled it leads to revolution. If Europe is still to practise the old industrialism, which provided luxury and ease for the few and toil and penury for the many, the new extension of popular government will soon be recognized by the masses as little more than a new name for an ancient evil; and we shall witness a violent disruption of society-a Bolshevist régime, somewhat modified by the better education of Western Europe.

It is unfortunate that there should have been so much exaggeration as to the importance of the part which the mere form of government plays in the life of the average man. Few men have, in fact, any great interest in this matter; what the majority are concerned with is not the form but the substance of their institutions, not how they function but what they give. When the first enthusiasm of new democracies has waned, the enfranchised millions

will be eagerly examining the tree of political freedom for the hoped-for fruit of social betterment. The real task before the world to-day is to see that the fruit is both sound and plentiful, that it is not a crop of Dead Sea apples.

We in the United States are as much concerned as the rest of the world in every project directed toward securing everywhere a more even distribution of the world's goods, narrowing the gulf which separates the rich from the poor, and increasing greatly the numbers of the measurably well-to-do. Our contribution to this work can be made of the greatest value to humanity, if we base it upon our example and not merely on our precepts or preachments. By carrying out among ourselves the reforms we would prescribe for others, our sincerity can be made plain and our experience made valuable.

At every step we must be guided by two broad principles: that Democracy is not the expression of the equality of all men, but of their equal right to develop, to exercise, and to profit by their individual qualities; and that no program of social justice can ever realize its object if it seeks to interpret equal opportunity in terms of an equal reward for unequal service.

It need not, therefore, surprise the reader that the problems to be discussed here are primarily national problems, and that world problems hold only the second place. America's place in the world will depend not upon what America claims, but upon what America is. We are told to-day that we should have a world outlook, but just as the affairs of a community can only prosper when each citizen follows assiduously and intelligently his own business, so the affairs of the community of nations can only prosper as each nation proves itself capable of managing intelligently its own affairs. One cannot dissociate the

welfare of a nation from that of its citizens. If we cannot help ourselves we cannot help others.

The happiness of the individual depends upon contentment, activity and intelligence. He cannot be content when he labors under a sense of injustice, when he feels that he is oppressed by privilege and is not accorded a fair opportunity. Hence the problems of government are given first place in our thesis. The primary function of government is to establish equality of opportunity, and if, through the indifference of its citizens, forms and procedure which restrict this opportunity are allowed to gain the upper hand, the government itself becomes in that degree a menace to the public welfare. Without expounding any exaggerated theory that government alone can make men happy and contented, it must be recognized that government possesses in a high degree the power to make them unhappy and discontented. It may, indeed, go far towards engendering a spirit of revolt. It is from this point of view that we shall endeavor to review some of the vital problems of government.

Again, the individual depends for his happiness upon his activity. He loses his spur to activity if industrial conditions fail to insure him the opportunity to exercise his gifts and to obtain a just reward for the effort which he makes. The second phase of the problems of the day, therefore, concerns the problems of labor. We shall see here how much depends upon the maintenance and continual development of the standard of living: we shall discuss the requirements of that standard, the struggles to advance it and the obstacles which beset its upward

movement.

Moreover, the happiness of an individual depends not only upon his opportunity and his activity but upon the skill and wisdom with which he uses them. Nor is it