capital as so much money it is
really goods and property. In England money consists chiefly of credit
in the books of banks, which can only be created because there is
property on which the banks can make advances, or because there is
property expressed in securities in which the banks can invest or
against which they can lend. Because our forefathers did not spend all
their incomes on their own personal comfort and amusement but put a
large part of them into railways and factories, and shipbuilding yards,
our country is now reasonably well supplied with the machinery of
production and the means of transport. Whether it might not be much
better so equipped is a question with which we are not at present
concerned. At least it may be said that it is more fully provided in
these respects than new countries like our colonies, America and
Argentina, or old countries like Russia and China in which industrial
development is a comparatively late growth, so that there has been less
time for the storing up, by saving, of the necessary machinery.

So it comes about that new countries are in greater need of capital than
old ones and consequently are ready to pay a higher rate of interest for
it to lenders or to tempt shareholders with a higher rate of profit. And
so the opportunity is given to investors in England to develop the
agricultural or industrial resources of all the countries under the sun
to their own profit and to that of the countries that it supplies. When,
for example, the Government of one of the Australian colonies came to
London to borrow money for a railway, it said in effect to English
investors, "Your railways at home have covered your country with such a
network that there are no more profitable lines to be built. The return
that you get from investing in them is not too attractive in view of all
the trade risks to which they are subject. Do not put your money into
them, but lend it to us. We will take it and build a railway in a
country which wants them, and, whether the railway pays or no, you will
be creditors of a Colonial Government with the whole wealth of the
colony pledged to pay you interest and pay back your money when the loan
falls due for repayment." For in Australia the railways have all been
built by the Colonial Governments, partly because they wished, by
pledging their collective credit, to get the money as cheaply as
possible, and keep the profits from them in their own hands, and partly
pro