the
undeveloped country, manufacture them and sell them back as finished
material (the British policy in India), or else they desire to secure
possession of the resources, franchises and other special privileges in
the undeveloped country which they can exploit for their own profit (the
British policy in South America).

The Indians, under the British policy, are thus in relatively the same
position as the workers in one of the industrial countries. They are
paid for their raw material a fraction of the value of the finished
product. They are expected to buy back the finished product, which is a
manifest impossibility. There is thus a drastic limitation on the
exploitation of undeveloped countries, just as there is a limitation on
the exploitation of domestic labor. In both cases the people as
consumers can buy back less in value than the exploiters have to sell.
Obviously the time must come when all the undeveloped sections of the
world have been exploited to the limit. Then surplus will go a-begging.

Some of the investors in the great exploiting nations have abandoned the
idea of making huge returns by way of the English policy in India.
Instead the investors in every nation are buying up resources,
franchises and concessions and other special privileges in the
undeveloped countries and treating them in exactly the same way that
they would treat a domestic investment. In this case the resources and
labor of the undeveloped country are exploited for the profit of the
foreign investor.

The Roman conquerors subjugated the people politically and then exacted
an economic return in the form of tribute. The modern imperialists do
not bother about the political machinery, so long as it remains in
abeyance, but content themselves with securing possession of the
economic resources of a region and exacting a return in interest and
dividends on the investment. Political tribute is largely a thing of the
past. In its place there is a new form--economic tribute--which is
safer, cheaper, and on the whole far superior to the Roman method of
exploiting undeveloped regions.

5. _The American Home Field_

A hundred years ago the United States was an undeveloped country. Its
resources were virgin. Its wealth possibilities were immense. Both
domestic and foreign capitalists invested large sums in the canals, the
railroads and other American commercial and industrial enterprises. The
rapid economic expansion of recent years has i