whereas there was no protection of Great Britain or France or America in this treaty, there was for the mainland of Japan. It was intimated that the treaty might be construed to give to Japan such a guaranty of security against foreign aggression as the American Senate had refused to sanction with regard to France. There was at once conjured up the picture of American boys being sent to fight in any quarrel that Japan might choose to get into with some other Power.

At once a great body of press correspondents started off on the new scent.

If Senator Lodge in his speech which accompanied the presentation of the treaty had thought to mention the islands of Japan as he pictured the scattered islands of the Pacific ranging "from Australia, continental in magnitude, to atolls where there are no dwellers but the builders of the coral reefs or lonely rocks marking the peaks of mountains which rise up from the ocean's floor through miles of water before they touch the air," possibly this diversion might have been avoided; for in his speech Senator Lodge made perfectly plain that there could be no guaranty to the mainland of Japan, for the simple reason that there was no guaranty in the treaty whatever.

What started many of the press correspondents off to follow the red herring can perhaps be understood after a consideration of the circumstances under which press correspondence is prepared and despatched. Each day the correspondents of the daily newspapers seek for some special news which will command attention and be worthy of display. It is impossible for such a conference as this to reach critical decisions every day. Consequently there are days when the progress of the Conference, though important, is without sensational features. Anything that promises to be picturesque or sensational on such off days is naturally welcome. With the best intent in the world, every daily newspaper correspondent is under pressure to make the most of anything that seems rather out of the ordinary. Watching this Conference, moreover, are men who have been long trained in following the tortuous ways of the traditional kind of diplomacy, and they naturally believe that any course that goes off to one side is likely to be the true trail. There are also newspapers that have partisan ends to serve, and they are not always above misrepresentations which are likely to occasion trouble to the party in power. Unfortunately, too, many of the men representing the so-called liberal thought are bitter, suspicious, and over-fearful of being thought credulous. Some of them are so habituated to revolt against social conditions that they see intrigue and false pretense in everything about them. Some of them, professed pacifists, are suffering apparently from what they like to call a complex, in this case

suppressed pugnacity, and, being determined to do all they can to prevent war, find relief in a war of words against everybody not of their own faction. Naturally, too, in the course of such a Conference as this dealing with complicated questions there is bound to be a certain by-product of bewilderment, and this is particularly to be expected to make its appearance in the minds of those who have been thinking for weeks or months in the terms of international guaranties and then find themselves in a Conference which ignores guaranties altogether and builds its plans upon national self-restraint and international

understanding.

Here, then, were two "stories" of a sort that could be put into headlinesthe story of an alleged pledge of armed security for Japan, and the story of alleged concealment and furtiveness. Then came the opportunity for another "story"-disagreement between the President and the Secretary of State. In answer to the inquiry of a correspondent President Harding was reported to have said that he understood that the scope of the treaty did not include the homeland of Japan. Within a few hours of the publication of this report, which was correct, the President issued the following statement:

When the President was responding to press inquiries at the afternoon interview to-day, he expressed the opinion that the homeland of Japan did not come within the words "insular possessions and insular dominions" under the four-party agreement, except as territory proper of any other nation which is a party to the agreement. This expression has been emphasized as a division between the President and the delegates to the Conference in construing the four-party agreement.

The President announced to-night

that the difference in view in nowise will be permitted to embarrass the Conference or the ratification of the agreement. He had assumed all along that the spirit of the Conference contemplates a confidence which pledges respect of territory in every way which tends to promote lasting peace.

He has learned from the United States delegation to the Conference that they have agreed to the construction which includes the homeland of Japan in the term "insular possessions and insular dominions," and has no objection to that construction.

What this proved was not disagreement as to anything vital, but it did show that the American delegates were acting with so free a hand that the President was not even following from day to day the details of their work. At Paris the Commissioners were evidently not kept informed of the decisions which the President was daily making. At the Washington Conference the President is keeping himself so much to one side that he gives an interpretation of the delegates' work which the delegates themselves do not share. It seems to me that Mr. Harding's method in this respect is better than Mr. Wilson's. When he selected the plenipotentiaries to act for the Executive, he first made sure that the men he selected believed in the object he had in view and were competent, and then he left them to act as free agents. If any proof were needed that the Conference was free from Executive dictation, it is supplied in this incident.

As a matter of fact, the point upon which the varied interpretation centers is of no significance. No question can arise which would be materially affected by including or excluding the homeland islands of Japan within the scope of the

Keystone

treaty. Any question arising in the Pacific, if it is serious enough, will bring these four Powers together for common counsel if the treaty is observed, and that is all that the treaty requires. It is not a question of waiting until some military attack is made and then coming to a common defense. That is the method of an alliance. That is a method that has been tried many times. That is so common that some people seem to imagine that no nations can come to a common agreement without involving themselves in an alliance. That is a method that contemplates war and provides for a course of action in case of war. This Four Power Treaty does nothing of the sort. This does not contemplate war. This makes no provision for military or naval action. What this contemplates is the possibility of differences of opinion and policy, and it provides for doing under such a condition exactly what the nine nations assembled at Washington have been doing for the past six weeks.

The difference can be shown perhaps by a supposititious case such as was propounded to me. Let us suppose, said in substance a press correspondent in the course of a discussion on the subject, that Japan should send a submarine across the Pacific into the Panama Canal and there set off a mine and block the passage; that would be an attack upon one of the possessions of the United States, but it would not be an island possession in the Pacific. Would that involve this treaty? Such an instance is of exactly the sort that is contemplated in a treaty of alliance. If this were a treaty of alliance and such an act came within the scope of it, our allies would have to come to our

defense. But this is not a treaty of alliance, and such an act as that is not contemplated as an incident requiring its application. Such an act would be an act of war, and when war begins the time is past for conferences and consultation. What this treaty undertakes to do is to establish such relations that such an act on the part of any one of the four Powers would be inconceivable.

So far as the objection to including the homeland islands of Japan has any effect at all it plays into the hands of the militarists of Japan. It provides them with what advertisers call "a talking point." It enables them to say that Americans are not willing to pledge themselves not to make an aggressive attack upon Japan. It enables them to argue that, while pretending to promote mutual confidence, the Americans are, after all, suspicious. Indeed, if any country has a reason for sentimental objection to the inclusion of the islands of Japan in the scope of the treaty it is Japan itself, for it may be argued that it tends to set Japan apart as a country whose homeland is dependent for safety upon the promises of other nations. Of course all these arguments pro and con have no bearing upon the real purpose of the treaty or its operation in practice. This is made clear by the following statement issued from the White House on December 23:

The President will offer no comment on the disputes which attempt to magnify the differing constructions on the four-party treaty. To him these are unimportant. The big things aimed at are understandings for peace and an agreement to meet and discuss the preservation of peace whenever it is threatened. No alliance or entanglement is thought of,

none will be negotiated. It would be better to rejoice over things accomplished than to dwell on different views which can be of no great consequence.

The President is unwilling that the unjustified charge that the United States delegates are withholding information shall go unchallenged. He has full confidence, else he had not chosen them, and he has full confidence now and is more than gratified over their efforts, because they are working out the greatest contribution to peace and good will which has ever marked the Christmas time in all the Christian era.

It is one thing to talk about the ideals of peace, but the bigger thing is to seek the actuality. This the Conference is doing, in harmony with overwhelming American sentiment, and a world sentiment, too, and in full accord with cherished American traditions.

an

When this statement was issued, President Harding was asked by a correspondent whether he thought that during 1921 there had been progress in peace and good will, and he answered:

I think I made some such reply to a similar question at the last interview. I do think so. I believe it with all my heart. I do not say that with the thought of arrogating to the United States of America any greater part of the contribution than that which has been made by other nations of like importance and like civilization. But it seems to me that in 1921, as we have come to know more fully the aftermath of the war, as we have come to appraise the unspeakable cost of it all, there is a new conviction in the hearts of men that that sort of appeal-the appeal to arms-to settle the international questions is a futile thing, and that we are unworthy of our position and unworthy of the blessings which fall to a righteous civilization if we do not find some means for a righteous adjustment without appeal to slaughter and waste and all the distresses that attend. I think that conviction has rooted itself throughout the world, and there must come some helpful, progressive expression of it. I think that expression is being given at this Conference. I have no thought to preach on this subject to-day, but make your own applications, please.

When men sit about the Conference table and look each other in the face and look upon the problems deliberately, without passion, they find the way to come to an agreement. And after all there has never been a conflict in the world that has not been settled in the end in that way. You have a war; you destroy thousands or millions of men and measureless treasure, and then you gather about a table and settle it. I have a feeling that mankind has become wise enough to sit down before the war and try to settle it. And that is the object of the four-party treaty. That is why I say the small lack of agreement in construing it is not significant.

Why, if there was a menace of peace in Japan, what objection could there be for the United States to sit down with her friend in the Orient

and with the other Great Powers and discuss how the matter could be adjusted? If some one had done that when Austria was threatening Serbia, there would have been no European War. The whole purpose of this Conference is to provide some means where just, thoughtful, righteous peoples, who are not seeking to seize something which does not belong to them, can live peaceably together and eliminate causes of conflict. This is in the American heart and it is in the British heart and it is in the Japanese heart, in the French heart, in the Italian heart-it is everywhere in

HERE is a bill now before Congress which is the first necessary step in an important change of public policy. It is S.-2749, on longrange planning of public works, introduced by Senator Kenyon on November 21, on the recommendation of the President's Conference on Unemployment.

The Conference on Unemployment pointed out the need for long-range thinking and long-range planning in public affairs. This bill will help to make that thinking and planning an actuality.

The Kenyon Bill advocates, as a definite policy, the expansion and contraction of Federal public works to accord with the periods of fall and rise in private industry and employment. Such a policy is a right-about-face on the part of the Federal Government. In the past it has been much more likely to expand its public works in boom times and to contract them in dull times. What this bill does is to call upon the various public works agencies of the Federal Government to be prepared in advance with engineering plans for proposed undertakings, so that when an appropriation is made in a time of depression the work an go forward immediately, rather than wait months or years until plans have been prepared and approved. Before the Kenyon legislation there has been no incentive for Federal public works agencies to keep ahead of the game. After this legislation it will be a breach of auty on the part of public works officials if they are not ready to proceed whenever called on to do so.

Many Government projects contain intricate problems which will require years to solve. For instance, the Boulder Canyon Dam in Arizona would develop more power than Niagara Falls, would light southern California, and would run the railways and many factories. But before it can be built agreements must be had from various States not to divert the head-waters into other watersheds; the Government policy must be determined, involving Federal, State, city, and private corporations; and engineering work planned over hundreds of

miles, not to mention irrigation subsidiaries for hundreds of thousands of acres of land. Again, post offices and Federal buildings are needed in hundreds of towns. The Federal Government rents many cramped and inadequate quarters. There is constant pressure on members of Congress to fill Federal needs locally. These buildings will be built. The only question is when. The Kenyon Bill proposes that plans for these undertakings be ready wherever possible, and the bulk of them executed during bad times rather than during boom times.

Vast areas are sure to be reclaimed through irrigation and drainage. The territory of the United States will eventually be increased, not by wars of conquest, but by the pick, the shovel, the dam, and the ditch. These great undertakings usually linger in Congress because there is no impetus to action. The Kenyon Bill would assist, not only in having ready the plans for such projects, but in giving the final impetus at a time when general industry and employment are in need of stabilization.

How can Congress know the proper time to go ahead? The Kenyon Bill provides that the Department of Commerce shall publish monthly statements of the rise and fall in cyclical waves of business expansion and depression as a guide in preparing in advance for the expansion of public works. A few large corporations have kept such statistics and have been able to predict the peaks of the waves of expansion. By making few purchases of raw materials at such times, by keeping their stores low, they have been able to make profits by refraining from buying at the top and having the resources to buy and manufacture as the wave falls. Each corporation which follows this policy takes a little off the top and fills in a little of the trough of the wave of depression. The barometer of business proposed by this bill would enable more business men and corporations, as well as the Government, to obtain this information and protect themselves accordingly.

The Kenyon Bill has value as an educational measure with respect to the public works policy of cities and States, the volume of whose public works is over five times that of the Federal Government. When Washington takes the lead, the cities and States will gradually follow. To-day advance planning of public works by American cities hardly exists. City plans over a period of years would enable a city to carry out some of its major improvements during periods of depression, when men and materials are plentiful. Municipal bonds are often in greatest demand when capital is timid about investment in industrial enterprises. Consequently the cities are able to go ahead during bad times when private industry is checked. Only a small part of the ordinary necessary public works needs to be deferred each year, in order to iron out an appreciable part of the inequalities of employment.

In a growing country like the United States the amount of public works of Federal, State, and municipal governments is so great that if this policy were followed and the resulting accumulation, plus the normal, executed in a year of depression like the present, the actual wages paid in public works would be equal to a large percentage of the loss in wages in private industry during the period of depression. But the wages received in public works are only a small part of the total stimulus to industry. Orders for the necessary materials provide an additional wage payment. The wages received by direct workers and workers in production of materials create by their expenditure a demand for commodities and set new groups of workers to making garments, shoes, and textiles, and so liquefy the frozen credits in raw and finished materials.

A concentrated public works programme is like dropping a pebble into a pond. The waves extend to the farthest shores of industry. But before the pebble is dropped there must be forethought, there must be planning, and these the Kenyon Bill is intended to stimulate.

W

ITH the election of Mr. Harding it became obvious that one of the first duties of the incoming Administration would be to take stock in that branch office of American democracy which we know as the Philippines. That particular branch of our Governmental concern has always been a source of anxiety. It provided Mr. Bryan with one of the best-selling articles in his sample book. It moved William Vaughan Moody to passionate poetry. It has figured in the National platforms of the major parties ever since Admiral Dewey remarked to a gentleman by the name of Gridley, "You may fire when ready."

With the accession of President Harding the country voted to give its affairs again into the hands of the same board of directors (or the political heirs of that board) which was responsible for the original Oriental investment in American Preferred.

For eight years the management of this investment had been in the hands of men who because of party pledge and personal predilection had fought the venture from the start and who were eager to wipe the whole affair off the books at the earliest possible moment.

It was in this attitude of mind that President Wilson sent a Message to Congress in December, 1920, in which he said:

Allow me to call your attention to the fact that the people of the Philippine Islands have succeeded in maintaining a stable government since the last action of the Congress in their behalf, and have thus fulfilled the condition set by the Congress as precedent to a consideration of granting independence to the islands. I respectfully submit that this condition precedent having been fulfilled, it is now our liberty and our duty to keep our promise to the people of those islands by granting them the independence which they so honorably covet.

When President Harding came into office, he quoted this Message in a letter to Secretary Weeks, pointing out the fact that Congress had not acted upon this recommendation and saying:

Undoubtedly that non-action was due to the fact that all of the evidence available to Congress was not of this same tenor. Based, however, as it was, on official reports from the highest authority in the Philippine Islands, as well as on current reports from lesser authorities given the widest circulation in the United States, as well as in the islands, it cannot, with propriety, be ignored, nor yet can it, in the face of conflicting evidence from many sources, be accepted as the final word on so important a subject.

In the same letter President Harding said that he had selected Major-General Leonard Wood and W. Cameron Forbes,

In his instruction to General Wood Secretary Weeks quoted the original instructions issued by McKinley for the guidance of the Commissioners sent to 1900. the Philippines in President McKinley wrote:

In all the forms of government and administrative provisions which they are authorized to prescribe, the commission should bear in mind that the government which they are establishing is designed not for our satisfaction, or for the expression of our theoretical views, but for the happiness, peace, and prosperity of the people of the Philippine Islands, and the measures adopted should be made to conform to their customs, their habits, and even their prejudices, the fullest extent consistent with the accomplishment of the indispensable requisites of just and effective government.

Secretary Weeks declared to General Wood that no better guide for judgment of the adequacy of the Philippine Government as it now exists could be found than this statement of President McKinley.

The conclusions reached by General Wood and Mr. Forbes have now been made public in one of the most illuminating governmental reports which we have ever read. It is marked throughout by breadth of vision and tolerance of spirit. It is the fruit of a truly judicial attempt to investigate the situation in the Philippines with scientific thoroughness and to derive from this investigation conclusions of the most constructive character.

The report begins with a summary of the task confronting the Commission. This is followed by an outline history of the Philippines and of the American occupation of the islands. The study of the present condition of the islands covers the state of the public order, administration of justice, the question of land titles, the conduct of public institutions, such as prisons, hospitals, and the Bureau of Science, the development of the school system, economic conditions, and finances.

It is in the administration of the schools that the Commission finds its best cause for congratulating the islands. Of their attitude towards education the Commission states:

"The whole people have a consuming thirst for education," and again: "The

Filipinos are deeply interested in public
education. Their enthusiasm, their
keenness to secure education for their
children, is beyond praise.
The pro-
gressive development of the school sys-
tem has been phenomenal."

This high praise is modified only by the following condition: "Indeed, enthusiasm has at times outrun prudence, and expansion has taken place so rapidly that efficiency has not been able to keep pace. However, such mistakes as have been made have resulted from enthusiasm in a noble cause-the education of the youth of the islands."

In the field of finance the darkest chapter.in the effort to Philippinize the Philippine Government is to be found. The Commission states:

The story of the Philippine National Bank is one of the most unfortunate and darkest pages in Philippine history. This bank was started in 1916, and a law was passed compelling all provincial and municipal governments to deposit all their funds in it; and at the same time arrangements were made to transfer from other banks all government funds there deposited, except trust funds, which were held on deposit in the United States; later the bank was put into a position to get control of these moneys and reserve funds. The sum of $41,500,000, held for the conversion of currency, was transferred to the Philippine Islands, the bank making a large profit in exchange in doing so. Much of it was then loaned out to speculative concerns under circumstances which have led to grave doubt as to the good faith of the transactions. . . .

A partner of Messrs. Haskins & Sells, certified public accountants of New York, after a careful examination of the bank, makes the following comment:

"Our examination thus far reveals the fact that the bank has been operated during almost the entire period of its existence prior to the appointment of Mr. Wilson as manager in violation of every principle which prudence, intelligence, or even honesty, dictate."

The losses of the bank, the Commission points out, have involved the Philippine Government to a very grave extent:

The currency resources have been depleted, the silver on deposit to redeem the currency has been pledged and used for other purposes. The fund for the maintenance of the parity of gold and silver is involved in these losses, with the result that instead of a metallic and cash basis for the currency, its principal support now is the pledge of the Philippine Government and the confidence on the part of the public that the United States will not permit these things to happen again. The currency is now practically a fiat currency.

In view of good earnings, moderate