government.

With the conversion of Japan from war to peace, the process of fiscal
recuperation and industrial development has been observed by students of
Eastern affairs with the keenest interest. The debt of the nation at the
close of the war in 1905 was approximately $870,000,000, which sum,
apportioned among Nippon's 47,000,000 inhabitants, was $18.71 per
capita. The amount properly chargeable to the campaign was $600,000,000,
or thereabouts. A characteristic of the war commanding widespread
attention was that the Japanese side was conducted from start to finish
on the soundest financial principles, with her credit abroad scarcely
lessened by successive bond issues. It was the criticism of students of
finance that Japan conducted her campaign throughout on a gold basis, as
if exploiting a vast commercial program, without subjecting herself to
usurious commissions, and without resorting to the issuance of fiat or
negligible currency. The financing of the Asiatic side of the great
Russo-Japanese conflict was certainly as businesslike as anything ever
done by a European power compelled to raise funds by foreign bond sales.

[Illustration: BRONZE DAIBUTSU AT KAMAKURA, JAPAN]

When a candid history of the war is penned, the writer must perforce
acknowledge the "luck" attaching to Japan when Russia expelled the Jews,
and when thousands of that faith were ruthlessly slaughtered at
Kishineff. Whether the purse-strings of the world are controlled by
Hebrew bankers may be a moot question, but it was a fact distinctly
clear that Japan could place her bonds in any money-lending country in
the world, while Russia could scarcely raise a rouble upon her foreign
credit. Even Germany, the sentimental ally of Russia, almost begged for
the privilege of lending to Japan. There was no disputing that the great
Hebraic banking houses of London, New York and Frankfort found it an
easy task to supply the Mikado's country with every needed sinew of war,
and the massacres of Kishineff may have been avenged in a measure at
Port Arthur and Mukden.

The ambitious and sturdy people of Japan are indisposed to regard the
war debt as an excessive burden, and it is their determination to treat
their bonded obligations as a spur to active industry. It must be
confessed that Japan's debt is but a trifle less than that of the United
States, and is carried at double the interest rates of the American
debt; and further, that Japan's total area is smal