lions. There
is a large balance left over unconsumed. What is done with this balance?
What can be done with it? Labor cannot consume any of it, for labor
has already spent all its wages. Capital will not consume this balance,
because, already, according to its nature, it has consumed all it can.
And still remains the balance. What can be done with it? What is done
with it?"

"It is sold abroad," Mr. Kowalt volunteered.

"The very thing," Ernest agreed. "Because of this balance arises our
need for a foreign market. This is sold abroad. It has to be sold
abroad. There is no other way of getting rid of it. And that unconsumed
surplus, sold abroad, becomes what we call our favorable balance of
trade. Are we all agreed so far?"

"Surely it is a waste of time to elaborate these A B C's of commerce,"
Mr. Calvin said tartly. "We all understand them."

"And it is by these A B C's I have so carefully elaborated that I shall
confound you," Ernest retorted. "There's the beauty of it. And I'm going
to confound you with them right now. Here goes.

"The United States is a capitalist country that has developed its
resources. According to its capitalist system of industry, it has an
unconsumed surplus that must be got rid of, and that must be got rid
of abroad.* What is true of the United States is true of every other
capitalist country with developed resources. Every one of such countries
has an unconsumed surplus. Don't forget that they have already traded
with one another, and that these surpluses yet remain. Labor in all
these countries has spent it wages, and cannot buy any of the surpluses.
Capital in all these countries has already consumed all it is able
according to its nature. And still remain the surpluses. They cannot
dispose of these surpluses to one another. How are they going to get rid
of them?"

* Theodore Roosevelt, President of the United States a few
years prior to this time, made the following public
declaration: "A more liberal and extensive reciprocity in
the purchase and sale of commodities is necessary, so that
the overproduction of the United States can be
satisfactorily disposed of to foreign countries." Of
course, this overproduction he mentions was the profits of
the capitalist system over and beyond the consuming power of
the capitalists. It was at this time that Senator Mark
Hanna said: "The production of wealth in the United States
is one-t