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weeks ago in what is known as the “Mobile Declaration," when he states that "interests do not tie nations togethersometimes separate them—but sympathy and understanding do bind them together.” Ipsissima verba.
Sympathy and understanding are admittedly essential to binding nations together, but I cannot apprehend how sympathy and understanding can be developed without that intimate intercourse which best results from commercial relations.
The suggestion is certainly idealistic, but I believe that sentimental ties that do not result from community of interests are far too tenuous to withstand the strain of inherent racial and religious antipathies.
What is more idealistic-sublime than the conception that “marriages are made in heaven;" and yet even the closest philosopher, married or unmarried, knows that that sympathy and understanding which is essential to happy marriages, despite their divine origin, can be developed only by intimate intercourse and by community of interests.
It is community of interests upon which we must depend to maintain the world's peace.
THE PROBABLE EFFECT OF THE OPENING OF THE PANAMA CANAL ON OUR ECONOMIC RELATIONS WITH THE PEOPLE OF THE
WEST COAST OF SOUTH AMERICA
By Hiram Bingham, Ph.D. Assistant Professor of Latin
American History, Yale University
With the actual opening of the Panama Canal so near at hand, it may seem to some that the consideration of this subject had better be postponed for a decade or so until the actual effect rather than the probable effect can be the topic for discussion. To such minds the proper time for considering this subject has long since passed. It might have been worth discussing when the question as to the advisability of our digging the canal was in the air, but at present, they say, it is simply a waste of time.
To this it may be replied that the American people dug the Panama Canal for military expediency and because it suited them to do so, chiefly to knit our own country closer together, and without regard to its good or bad effects on the west coast of South America. Consequently there was no particular object in discussing this subject in connection with the advisability of digging the canal. Furthermore, while there is no question that a study of the actual effect of the canal on the west coast will prove to be both interesting and instructive if undertaken during the course of the next decade, there are also good reasons why it is expedient to consider this subject now, even while we are on the threshold of the new era.
The chief of these reasons is the keen optimism which prevails in some circles in the United States and to a greater extent on the West Coast, that the opening of the canal is going to usher in an era of great prosperity; is in fact, going to effect a veritable economic revolution. If this is true, we must prepare for it; if not, we must be on our guard against it. In either case the very existence of this optimism is a sufficient cause
THE JOURNAL OF RACE DEVELOPMENT, VOL. 5, no. 1, 1914
for the most careful consideration of the possibilities. Forewarned is forearmed. No man starteth to build a house without counting the cost thereof, lest when his work is but half completed he find that he cannot continue, and his halfbuilt edifice remaineth as evidence of his folly. In other words, it is the policy of wisdom both for us and for South America to look ahead as far and as carefully as possible.
Now that we have mentioned this optimism, it may as well be admitted in the beginning that the probable effects due to this very optimism are among the most difficult things which we have to estimate. Psychology is, I suppose, a science, although some people still classify it under philosophy, and regard it as extremely empirical, The day may come when the masters of psychology will be able to give us as accurate a prediction regarding the probable force of any given set of beliefs or opinions as the economic geologists give today in regard to the probable value of any given mineral deposit. No one denies that geology is a science, even though we all know that the reports of economic geologists with regard to the probable success of a mine are not always infallible!
But at present, psychologists have not got to that point where they can even approximate the positive effects of widely disseminated beliefs. Consequently, it is extremely difficult, if not absolutely impossible, to say to how great an extent the psychological side of the opening of the Panama Canal is going to affect our trade with the west coast and our relations with the people of Ecuador, Peru and Chile. Yet this part of the problem cannot be lightly dismissed, for it appears to be one of considerable magnitude.
Nearly every intelligent Peruvian and Ecuadorian with whom one talks believes firmly and enthusiastically that, with the opening of the Panama Canal, his country is going to start out on an era of great commercial prosperity. To his sensitive and imaginative mind, the defenses to a rich and great city are about to be pierced. The opening of the waterway is to him the unlocking of the gates permitting him to enter and enjoy the results of a long and arduous siege. With the inrush of the waters into the canal will come an inrush of
capital, immigration and trade, which will raise his country out of its present despondent condition and place it in the forefront of the world's progress. Veritably it is a miracle which is about to happen.
The Chilian is somewhat less optimistic. He is sure the the canal will benefit Chile, but just how much is another question. He is keenly conscious of the fact that heretofore Chile has been nearer Europe on the ocean waterway than any other west coast country, while the opening of the canal will reverse this position and make Chile the farthest away. At the same time, the Chilian is doing what he can to take advantage of any new opportunities by actively building new docks and new railroads. A large section of the longitudinal railway which parallels the coast has recently been completed, and plans are already being considered for large extensions. By reasion of its wealth of nitrates Chile is prosperous. Export duties on this valuable product give her an abundant revenue. Her climate is more temperate; what agricultural land she has is more available. The Indian stock in the south of Chile is more vigorous than that of her northern neighbors.
Owing to adverse economic conditions the ardent optimism of the Peruvians and Ecuadorians has not enabled them to do as much as they would like in preparation for the opening of the canal. Furthermore, there is the well-known tendency which prevails in so many tropical countries of believing that things are going to happen without actually doing very much to make them happen. Consequently, much as I feel that the west coast people are going to be disappointed in the extent of the prosperity which is about to come to their shores, I have not found any evidence to show that this disappointment, if it comes, will mean great financial loss, accompanied by the hardships incident to the collapse of a boom, unless this boom is engineered by outside capital. Even in that case, the hardest blow will fall on the investor, and there are relatively few capitalists on the west coast.
The psychologic effect on the minds and actions of the business men of the United States is far more difficult to estimate, and is likely to be followed by graver consequences. If a considerable number of American manufacturers and capitalists get carried away with the idea that the opening of the Panama Canal means a great boom on the west coast of South America, if they believe that the completion of that waterway is of equal significance with the completion of the first transcontinental railway across the United States, or with one of the great industrial discoveries such as the practical application of steam to navigation or the replacement of iron for wood in the construction of ocean vessels, if they catch any part of the tremendous optimism and enthusiasm of the average Peruvian, for instance, something very serious is going to happen. American energy and initiative, backed by American capital, will be directed to new projects, and enterprises involving great risks will be undertaken.
It is possible to conceive of a great increase in our trade with the west coast of South America, due solely to the fact that American manufacturers believe that the opening of the canal has opened to them a new market, and made it possible for them to secure trade in regions where they have supposed this was heretofor impossible. It is entirely within the bounds of possibility that American capitalists, looking for larger returns on their investments, and believing that the opening of the Panama Canal is equivalent to opening the doors of tremendous opportunity on the west coast, will place large sums of money in enterprises which they would not otherwise have thought of considering.
We have no means of estimating precisely the extent of this optmism in this country. It varies in different sections and varies largely with the temperament of the people with whom one talks. If we could only tell exactly the force of it, we should be able to predict with reasonable accuracy the size of the approaching boom.
Before any such boom gets started it behooves us to observe as accurately as possible the foundation on which it will have to rest. If the economic and geographical foundations exist for such an extension of trade and capital as would follow any such optimism on our part as exists on the west coast, then the future has indeed in store for us many won