132 INTERNATIONAL TRADE 
over which the whole series of operations extends. All that can 
be said is that there is a general off-setting tendency between the 
earlier and the later stages, and a presumption that in the entire 
balance of this account neither country is likely to have any con- 
siderable net gain.! 
Freight charges and passenger fares constitute another important 
item. Of the two, freight charges are the larger, and while in the 
main they raise no new questions, some aspects deserve separate 
attention. 
The item of freight charges appears more particularly in the 
trade between countries separated by large stretches of ocean. 
Here there is a considerable gap between the place where the goods 
leave one country and that where they enter another; anda charge 
arises which does not necessarily form a part of the expenses of 
production within either. It is this circumstance — that the 
expenses may be incurred by residents of either country and that 
payments therefore may become due either way — which is pecul- 
iar to the item of freight charges. In other respects they present 
no peculiar features. They constitute a payment for service ren- 
dered ; and so far as the service is rendered to persons in one coun- 
try by persons living in another, payments must be made to the 
foreigner. The item figures in the international balance sheet like 
any other, with the same effects as a payment for goods. It is 
invisible, too, in the same sense as tourist expenses are; that is, 
no official record is made and the amounts that must be remitted 
are often not easily ascertained. 
There is a distinction, however, between the sum which the 
individual purchaser of foreign goods must pay for them, and the 
amounts which must be remitted to the foreign countriesin payment 
for the goods. The individual purchasers must pay the foreign 
1 If indeed the principal sum is never repaid — if the interest payments by the 
debtor go on indefinitely — there is some likelihood that the barter terms, being 
thus permanently affected to the disadvantage of the borrowing country, will 
cause more loss to it than had been gained in the period (which could hardly be 
permanent) where the new loans had caused the terms to be advantageous. I leave 
the reader to judge, especially after he has considered the qualifying and explana- 
tory chapters that are to come later, whether a consideration of this sort is worth 
mentioning at all,