the empire lasted until 1879. It placed Ger many in a very dangerous position, both for her agricultural production (in the free com petition with American agriculture), and in her industrial production (in free competition with the technically highly developed British indus tries). The fundamental change for a protective policy was marked by the Tariff Law of 1879. The free trade policy of 1892 aimed at a Con tinental European economic union, with Ger many as the leading industrial country, thus procuring profitable labor for her increasing population. That policy, however, failed in the main aim owing to national jealousies among the European nations, but led to the The problem of international exchange is made very difficult for Germany by the fact that the figures of export and import with the most important countries differ widely and that countries exporting raw materials and food stuffs most needed by Germany are, generally, not the countries needing most and in adequate quantities the products of German industries. This is especially true of the United States.
The trade of Germany with the Entente Powers of Europe (Great Britain, France, Rus sia, Italy, Belgium, Rumania, Portugal, Serbia, Montenegro, and their non-European political dependencies) constituted in 1913 almost one half of the total German foreign trade and more than one-half of the imports alone, amounting to about $1,280,000,000 in the im ports and about $1,210,000,000 in the exports. The trade with the British Empire amounted to about $550,000,000 in the imports, or 20 per cent of all imports, and about $470,000, 000 in the exports, or 19 per cent of all exports. The trade with Sweden, Norway, Denmark, Switzerland, Holland, Spain and Greece and their non-European political de pendenciei amounted to $370,000,000 in im ports and $540,000,000 in exports, or 17 per cent of the total German trade. The trade with the countries united in the Confederation of the Central Powers (Austria-Hungary, Tur key, Bulgaria) was, with a total of $560,000,000 —$240,000,000 in imports and $320,000,000 in exports — only about 10 per cent of the total Getman trade and only about one-half of the total German trade with Pan-America which amounted to $1,100,000,000, of which $730,000, 000 was on the import side and $370,000,000 on the export side.
Commercial Policy.—The free trade policy already inaugurated before the foundation of establishment of a system of commercial treaties binding together the European states for periods of 12 years (the first ending 1904, the second so far as not terminated by the out break of the war, 1914-18). The tariff of 1902 (the basis of the tariff treaties of 1904-05) was again highly protective, especially for the agri cultural interests, partly as a result of the growing conviction that a large raw production in agriculture and in mining was necessary to preserve the political independence of the na tion. But it was only during the last few years before the war that the question of raising all the necessary foodstuffs in Germany proper was discussed.
Customs Duties.—The gross amount of cus toms duties collected in 1913 was $181,000,000. There is in Germany a system of export cer tificates on some dutiable products like rye which allow for free imports of a correspond ing amount of dutiable foodstuffs and which are used for the payments of import duties. The amount of duties paid by those export certificates (in 1913 about $40,000,000) is not included in the figures above. By far the greater part of the customs duties ($138,500,000) is derived from foodstuffs. The German con sumer had to pay in the price of the foodstuffs imported on the average one-fifth more, and of grain particularly one-third more than the price would have been if free imports were granted_ The German farmer, especially the larger one, enjoys the benefit from the higher price level being stabilized in this position by the system of export certificates if Germany's own produc tion should exceed the amount that she wants for her own consumption. By agreement be tween the government and the parties the re ceipts from the raising of the grain duties in the Tariff Law of 1902 had to be reserved for the establishment of a national insurance for widows and orphans (introduced by the Insur ance Law of 1911). That clearly indicates the close connection between the protective and the social policy of the German Empire.
Germany's Commerce with the United In 1913 the United States occupied the first place in imports to, but only the fifth place in exports from, Germany, according to German statistics, and Germany held the sec ond place in imports to, and the third place in exports from, the United States, according to American statistics. Of the total exports from the United States 14.5 per cent went to Ger many, of the total imports 10 per cent came from Germany. Of the total imports into Ger many 16 per cent came from the United States, while of the total exports only 7 per cent went to the United States. The trade balance be tween the United States and Germany is over whelmingly in favor of the United States. Ger the last 25 years. In 1890 the trade balance was slightly in favor of Germany. Since 1890 the exports from the United States to Ger many have increased more than 300 per cent, while the exports from Germany to the United States did not increase 100 per cent. That development is due to the growing industrial ization of Germany with growing needs of im ports in raw materials and foodstuffs, cotton, fats, wheat, copper, and to the growing indus trialization of the United States, backed by a strong protective tariff policy which tends to exclude foreign manufactures from the Ameri can market. While Germany needs urgently some of the products in which the United States abound, there is no corresponding de mand in the United. States for goods produced in Germany.