[Footnote E:  We obtained from abroad in 1907, for instance, 476,400 tons of cotton, 185,300 tons of wool, 8,500,000 tons of iron, 124,000 tons of copper, etc.]

If the State can thus contribute directly to the increase of national productions, it can equally raise its own credit by looking after the reduction of the national debt, and thus improving its financial position.  But payment of debts is, in times of high political tension, a two-edged sword, if it is carried out at the cost of necessary outlays.  The gain in respect of credit on the one side of the account may very easily be lost again on the other.  Even from the financial aspect it is a bad fault to economize in outlay on the army and navy in order to improve the financial position.  The experiences of history leave no doubt on that point.  Military power is the strongest pillar of a nation’s credit.  If it is weakened, financial security at once is shaken.  A disastrous war involves such pecuniary loss that the State creditors may easily become losers by it.  But a State whose army holds out prospects of carrying the war to a victorious conclusion offers its creditors far better security than a weaker military power.  If our credit at the present day cannot be termed very good, our threatened political position is chiefly to blame.  If we chose to neglect our army and navy our credit would sink still lower, in spite of all possible liquidation of our debt.  We have a twofold duty before us:  first to improve our armament; secondly, to promote the national industry, and to keep in mind the liquidation of our debts so far as our means go.

The question arises whether it is possible to perform this twofold task.

It is inconceivable that the German people has reached the limits of possible taxation.  The taxes of Prussia have indeed, between 1893-94 and 1910-11, increased by 56 per cent, per head of the population—­from 20.62 marks to 32.25 marks (taxes and customs together)—­and the same proportion may hold in the rest of Germany.  On the other hand, there is a huge increase in the national wealth.  This amounts, in the German Empire now, to 330 to 360 milliard marks, or 5,000 to 6,000 marks per head of the population.  In France the wealth, calculated on the same basis, is no higher, and yet in France annually 20 marks, in Germany only 16 marks, per head of the population are expended on the army and navy.  In England, on the contrary, where the average wealth of the individual is some 1,000 marks higher than in Germany and France, the outlay for the army and navy comes to 29 marks per head.  Thus our most probable opponents make appreciably greater sacrifices for their armaments than we do, although they are far from being in equal danger politically.

Attention must at the same time be called to the fact that the increase of wealth in Germany continues to be on an ascending scale.  Trades and industries have prospered vastly, and although the year 1908 saw a setback, yet the upward tendency has beyond doubt set in again.