298
INTERNATIONAL TRADE
excess, which on first examination seems surprisingly great and
continuous, appears, on consideration of the entire range of foreign
transactions, quite such as is to be expected. So far theoretical
reasoning appears to be verified.
When we proceed to probe the matter further, however, we are
confronted by troublesome questions. They relate partly to the
machinery by which this nicely adjusted balance of payments was
brought about, and partly to the consequences for the barter terms
of trade.
First as regards the machinery, and especially the distribution of
cold between the United States and other countries. During the
fifteen years 1900-1914 the same absorption of the domestic pro-
duction went on as in the two decades immediately following the
resumption of specie payments in 1879. In the later period (after
1900) the net result of the oscillating international movement —
an inflow in some years, an outflow in others — was that the coun-
try neither got gold from foreign countries nor received it. The
total imports of gold for the fifteen years exceeded the exports by
50 millions ; a sum negligible for so considerable a period and for
a country so rich and populous. During the same time, however,
the United States was accumulating the gold yielded by her own
mines. The domestic output of gold was (in dollars) from 80 to
95 millions a year. While a substantial part was used in the arts,
the increase of monetary stock was still (in round numbers) 800
millions. Tho hardly any gold flowed in from foreign sources,
an enormous amount was added to the circulating medium from
domestic production.
The United States thus happened to receive, as the country’s
distributive share of the world’s monetary stock of gold, the total
of her own contribution to that stock. One might reason about
the case thus. If the United States had produced no gold ; if the
country had not been growing in population and wealth more
rapidly than other countries; if then the problem had been simply
that of distributing the world’s stock of gold (either constant, or
erowing very slowly from other sources) — the metal would have
