In articles of foreign and colonial merchandise exported to the United States, in 1897, from the United Kingdom, increases are chiefly observable in Number and net tonnage of iron, steel, and wooden sailing and steam vessels built in the United Kingdom for foreigners. Total number and tonnage of vessels registered under the merchant shipping acts belonging to the United Kingdom. Since the last report, made in 1897, a new railway running into London from the midlands has been opened to mineral traffic. This is the Great Central Railway, which, as its name implies, will form, when fully opened, another and a more direct link between the midland towns and the metropolis. No other lines of railway of importance have been completed. In regard to the postal rates, the only notable change is that on Christmas Day (December 25, 1898), penny (2 cents) postage will be introduced throughout the British Empire, with the exception of Australia. It is anticipated that this change will result in a considerable loss to the revenue for some time to come, but the enormous increase in communication that will follow will, it is expected, ultimately add to the revenue. It is announced that the Canadian Steamship Company, of Gracechurch street, London, is about to provide a fast steamship service between Milford Haven and Paspebiac, an ice-free port on Chaleurs Bay, Canada. It is stated that the venture has been organized by the Great Western Railway Company, of England, which has for years been endeavoring to establish a trans-Atlantic connection with Milford Haven (Pembrokeshire, Wales). The new service, it is claimed, will mean a saving, in distance at sea, of 150 miles, as compared with the Liverpool route, and in time, of two days. The first vessel, the Gaspesia, will leave Milford Haven on December 7, 1898, to be followed by the Paspebiac, on December 15, 1898. It is also announced that Messrs. Elder Dempster & Co., of Liverpool, are building six steamers for a biweekly service between Montreal and Bristol next summer. LONDON, November, 1898. WM. M. OSBORNE, BIRMINGHAM.1 The commercial relations of the United States with Great Britain and other great trading nations are changing so rapidly, and the changes are so much in favor of every home interest, that one hesitates when giving even the simple facts for fear of seeming to indulge in exaggeration. I shall therefore limit myself to the statements, first, that in my opinion there is hardly a single line of American manufacture of articles, used also in other countries, as well as many novel things not known elsewhere, but could be profitably exported if proper steps for its introduction were taken, and if careful, slow, reasonable, and common-sense methods of sale were adopted; second, I must add that, while I believe we are the best manufacturers in the world, I am also convinced that we are the poorest traders, and this is impressed upon me over and over again every day in my correspondence with American merchants and manufacturers and in my observations of the way they are handling the new export trade and of their endeavors to get into it; third, it is my idea that American export trade is rolling up like a snowball because of a 50 per cent superiority in manufacturing knowledge and natural resources, and despite a 15 to 30 per cent inferiority in trading knowledge, a heavy percentage of unwillingness to learn foreign trading customs, and a still greater percentage of lack of foreign merchant facilities and organization. If a small portion of the vast sum of money in the United States now seeking investment could be employed in some form of export scheme to handle American goods, we would soon be able to record a greater export of American goods than of the raw products of the soil, though to-day we are boasting of an excess of manufactured exports over the manufactured imports. Instead of summarizing the conditions I see here, I 1 In reply to circular of August 5, 1898, offer the following clippings from British publications, selected somewhat at random from many in my possession, and illustrating the keen appreciation here of what our competition means and may mean: [From the Birmingham Daily Mail.] By cheaper methods of production, America is overtaking us in more than one department of manufacture. Startling to the Midlands are the figures published to-day concerning nails. Statistics show that the exportation of wire nails from the United States has grown from 1,547.078 pounds in the fiscal year 1888 to 22,894.099 pounds in the fiscal year 1898. The growth, which has been phenomenal ever since the beginning, has been especially so in the last two or three years. In 1895, the exportations were 4,367,267 pounds; in 1896, 8,031,927 pounds, thus practically doubling in one year; and in 1898, 22,894,099 pounds, showing a similar gain in the last two years, the exports of 1898 being five times more than in 1895. This is not very pleasant, when one puts it side by side with the fate of the nail trade in the Midlands. Moreover, Chicago has become the seat of an iron-bedstead industry that threatens to defy competition, the United States generally is knocking even Germany out in the manufacture of cheap boots, and, besides this, American steel rails are being sent to Ireland and Bombay, while the estimates sent in for the supply of plates for the construction of a 6,000-ton ship show that in accepting an American contract there will be an economy of $10,000, as compared with the lowest English tender. [From the British Iron and Coal Trades Review.] The wonderful achievements of the United States in the way of reducing the costs of the production of iron and steel form the subject of one of several articles that have been written for the Review by a high authority. These figures supply the most obvious answer to the now almost daily question, as to how the United States has succeeded in bringing costs of production down to such a low level with nominally high labor costs and long transportation still a part of its daily lot. It appears that the labor cost of producing the crucible steel that was manufactured in the United States between 1860 and 1865 was about £15 ($72.99) per ton, against probably not more than 10s. ($2.43) per ton at the present time, and that between 1880 and 1890, the labor cost of producing a ton of pig iron, speaking generally, had been reduced more than one-half, while in some States the average annual output of pig iron per employee at the furnaces had more than trebled. All this, however, is not any more wonderful than the revolution that has been brought about in the cost of raw materials. It seems but yesterday when Lake Superior ores, delivered at works in Pennsylvania, cost 30s. to 358. ($7.29 to $8.51) per ton, whereas the same ores cost to-day about 15s. ($3.65), more or less. Most of us can remember when coke cost 30s. ($7.29) per ton delivered at Chicago, while the same fuel at present costs 12s. to 15s. ($2.92 to $3.65) similarly delivered. The wage cost of producing a ton of pig iron at the furnaces at Pittsburg or Chicago was equal to 20s. ($4.86) less than a quarter of a century ago, whereas to-day in the best regulated works it costs 2s. to 3s. (49 to 73 cents). In most other items of cost, similar economies and reductions have been effected. It has been the union of more efficient labor, more economical transport, and increased competition among mine owners that has enabled this remarkable change to be effected. Twenty years ago, mine owners were hardly satisfied with less than 10s. ($2.43) per ton profit on the highest grades of ore. To-day, they will gratefully accept less than a shilling (24 cents). The business is nevertheless a prosperous one, because the mine owner has substituted small profits on a large output for large profits on a small output, and is doing a sounder and more healthy business. The same remarks apply to the pig-iron maker, the coke manufacturer, and the producer of finished descriptions of iron and steel. This tendency to look to larger yields and smaller profit has not reached finality. It has been manifested in a marked manner in the recent combinations of works and mines, and in the growing disposition to get rid of all extraneous sources of expenditure. In all branches of business alike it is a fundamental axiom that the larger the scale of operations, the cheaper the possible costs of production. The United States has given practical expression to this principle on the largest possible scale, and thus, and thus only, has it been able to place itself in the front rank of iron-producing nations. The success of our American friends has been due to their vigorous and persistent attention to elements of business administration, which have been less effectively developed at home. The first of these has been a more complete control of the conditions of labor, based upon a generous recognition of the principle that nominally |