Mises Daily Articles
The Fallacy of Territorial Extension
The traditional belief is that a state aggrandizes itself by territorial extension, so that winning new land is gaining in wealth and prosperity, just as an individual would gain if he increased his land possessions. It is undoubtedly true that a state may be so small in territory and population that it cannot serve the true purposes of a state for its citizens, especially in international relations with neighboring states which control a large aggregate of men and capital.
There is, therefore, under given circumstances, a size of territory and population which is at the maximum of advantage for the civil unit. The unification of Germany and Italy was apparently advantageous for the people affected. In the nineteenth century there has been a tendency to create national states, and nationality has been advocated as the true basis of state unity.
The cases show, however, that the national unit does not necessarily coincide with the most advantageous state unit, and that the principle of nationality cannot override the historical accidents which have made the states. Sweden and Norway, possessing unity, threaten to separate. Austro-Hungary, a conglomerate of nationalities largely hostile to each other, will probably be held together by political necessity.
The question of expedient size will always be one for the judgment and good sense of statesmen. The opinion may be risked that Russia has carried out a policy of territorial extension which has been harmful to its internal integration. For three hundred years it has been reaching out after more territory and has sought the grandeur and glory of conquest and size. To this it has sacrificed the elements of social and industrial strength. The autocracy has been confirmed and established because it is the only institution which symbolizes and maintains the unity of the great mass, and the military and tax burdens have distorted the growth of the society to such an extent as to produce disease and weakness.
Territorial aggrandizement enhances the glory and personal importance of the man who is the head of a dynastic state. The fallacy of confusing this with the greatness and strength of the state itself is an open pitfall close at hand. It might seem that a republic, one of whose chief claims to superiority over a monarchy lies in avoiding the danger of confusing the king with the state, ought to be free from this fallacy of national greatness, but we have plenty of examples to prove that the traditional notions are not cut off by changing names and forms.
The notion that gain of territory is gain of wealth and strength for the state, after the expedient size has been won, is a delusion. In the Middle Ages the beneficial interest in land and the jurisdiction over the people who lived on it were united in one person. The modern great states, upon their formation, took to themselves the jurisdiction, and the beneficial interest turned into full property in land. The confusion of the two often reappears now, and it is one of the most fruitful causes of fallacy in public questions.
It is often said that the United States owns silver mines, and it is inferred that the policy of the state in regard to money and currency ought to be controlled in some way by this fact. The "United States," as a subject of property rights and of monetary claims and obligations, may be best defined by calling it the "Fiscus." This legal person owns no silver mines. If it did, it could operate them by farming them or by royalties. The revenue thus received would lower taxes. The gain would inure to all the people in the United States.
The body politic named the United States has nothing to do with the silver mines except that it exercises jurisdiction over the territory in which they lie. If it levies taxes on them it also incurs expenses for them, and as it wins no profits on its total income and outgo, these must be taken to be equal. It renders services for which it exacts only the cost thereof. The beneficial and property interest in the mines belongs to individuals, and they win profits only by conducting the exploitation of the mines with an expenditure of labor and capital. These individuals are of many nationalities. They alone own the product and have the use and enjoyment of it.
No other individuals, American or others, have any interest, right, duty, or responsibility in the matter. The United States has simply provided the protection of its laws and institutions for the miners while they were carrying on their enterprise. Its jurisdiction was only a burden to it, not a profitable good. Its jurisdiction was a boon to the miners and certainly did not entail further obligation.
It is said that the boundary between Alaska and British America runs through a gold field, and some people are in great anxiety as to who will "grab it." If an American can go over to the English side and mine gold there for his profit, under English laws and jurisdiction, and an Englishman can come over to the American side and mine gold there for his profit, under American laws and jurisdiction, what difference does it make where the line falls? The only case in which it would make any difference is where the laws and institutions of the two states were not on equal stages of enlightenment.
This case serves to bring out distinctly a reason for the old notion of territorial extension which is no longer valid. In the old colonial system, states conquered territories or founded colonies in order to shut them against all other states and to exploit them on principles of subjugation and monopoly. It is only under this system that the jurisdiction is anything but a burden.
If the United States should admit Hawaii to the Union, the Fiscus of the former state would collect more taxes and incur more expenses. The circumstances are such that the latter would probably be the greater. The United States would not acquire a square foot of land in property unless it paid for it. Individual Americans would get no land to till without paying for it and would win no products from it except by wisely expending their labor and capital on it. All that they can do now.
So long as there is a government on the islands, native or other, which is competent to guarantee peace, order, and security, no more is necessary, and for any outside power to seize the jurisdiction is an unjustifiable aggression. That jurisdiction would be the best founded which was the most liberal and enlightened, and would give the best security to all persons who sought the islands upon their lawful occasions. The jurisdiction would, in any case, be a burden, and any state might be glad to see any other state assume the burden, provided that it was one which could be relied upon to execute the charge on enlightened principles for the good of all. The best case is, therefore, always that in which the resident population produce their own state by the institutions of self-government.
What private individuals want is free access, under order and security, to any part of the earth's surface, in order that they may avail themselves of its natural resources for their use, either by investment or commerce. If, therefore, we could have free trade with Hawaii while somebody else had the jurisdiction, we should gain all the advantages and escape all the burdens.
The Constitution of the United States establishes absolute free trade between all parts of the territory under its jurisdiction. A large part of our population was thrown into indignant passion because the administration rejected the annexation of Hawaii, regarding it like the act of a man who refuses the gift of a farm. These persons were generally those who are thrown into excitement by any proposition of free trade. They will not, therefore, accept free trade with the islands while somebody else has the trouble and burden of the jurisdiction, but they would accept free trade with the islands eagerly if they could get the burden of the jurisdiction too.
Canada has to deal with a race war and a religious war, each of great virulence, which render governmental jurisdiction in the Dominion difficult and hazardous. If we could go to Canada and trade there our products for those of that country, we could win all for our private interests which that country is able to contribute to the welfare of mankind, and we should have nothing to do with the civil and political difficulties which harass the government.
We refuse to have free trade with Canada. Our newspaper and congressional economists prove to their own satisfaction that it would be a great harm to us to have free trade with her now, while she is outside the jurisdiction under which we live; but, within a few months, we have seen an eager impulse of public opinion toward a war of conquest against Canada. If, then, we could force her to come under the same jurisdiction, by a cruel and unprovoked war, thus bringing on ourselves the responsibility for all her civil discords and problems, it appears to be believed that free trade with her would be a good thing.
The case of Cuba is somewhat different. If we could go to the island and trade with the same freedom with which we can go to Louisiana, we could make all the gains, by investment and commerce, which the island offers to industry and enterprise, provided that either Spain or a local government would give the necessary security, and we should have no share in political struggles there. It may be that the proviso is not satisfied, or soon will not be. Here is a case, then, which illustrates the fact that states are often forced to extend their jurisdiction whether they want to do so or not.
Civilized states are forced to supersede the local jurisdiction of uncivilized or half-civilized states, in order to police the territory and establish the necessary guarantees of industry and commerce. It is idle to set up absolute doctrines of national ownership in the soil which would justify a group of population in spoiling a part of the earth's surface for themselves and everybody else. The island of Cuba may fall into anarchy. If it does, the civilized world may look to the United States to take the jurisdiction and establish order and security there. We might be compelled to do it. It would, however, be a great burden, and possibly a fatal calamity to us.
Probably any proposition that England should take it would call out a burst of jingo passion against which all reasoning would be powerless. We ought to pray that England would take it. She would govern it well, and everybody would have free access to it for the purposes of private interest, while our Government would be free from all complications with the politics of the island.
If we take the jurisdiction of the island, we shall find ourselves in a political dilemma, each horn of which is as disastrous as the other: either we must govern it as a subject province, or we must admit it into the Union as a state or group of states. Our system is unfit for the government of subject provinces. They have no place in it. They would become seats of corruption, which would react on our own body politic.
If we admitted the island as a state or group of states, we should have to let it help govern us. The prospect of adding to the present senate a number of Cuban senators, either native or carpetbag, is one whose terrors it is not necessary to unfold. Nevertheless it appears that there is a large party which would not listen to free trade with the island while any other nation has the jurisdiction of it, but who are ready to grab it at any cost and to take free trade with it, provided that they can get the political burdens too.
This confederated state of ours was never planned for indefinite expansion or for an imperial policy. We boast of it a great deal, but we must know that its advantages are won at the cost of limitations, as is the case with most things in this world. The fathers of the Republic planned a confederation of free and peaceful industrial commonwealths, shielded by their geographical position from the jealousies, rivalries, and traditional policies of the Old World and bringing all the resources of civilization to bear for the domestic happiness of the population only. They meant to have no grand statecraft or "high politics," no "balance of power" or "reasons of state," which had cost the human race so much. They meant to offer no field for what Benjamin Franklin called the "pest of glory."
It is the limitation of this scheme of the state that the state created under it must forego a great number of the grand functions of European states; especially that it contains no methods and apparatus of conquest, extension, domination, and imperialism. The plan of the fathers would have no controlling authority for us if it had been proved by experience that that plan was narrow, inadequate, and mistaken. Are we prepared to vote that it has proved so? For our territorial extension has reached limits which are complete for all purposes and leave no necessity for "rectification of boundaries."
Any extension will open questions, not close them. Any extension will not make us more secure where we are, but will force us to take new measures to secure our new acquisitions. The preservation of acquisitions will force us to reorganize our internal resources, so as to make it possible to prepare them in advance and to mobilize them with promptitude. This will lessen liberty and require discipline. It will increase taxation and all the pressure of government. It will divert the national energy from the provision of self-maintenance and comfort for the people, and will necessitate stronger and more elaborate governmental machinery.
All this will be disastrous to republican institutions and to democracy. Moreover, all extension puts a new strain on the internal cohesion of the preexisting mass, threatening a new cleavage within. If we had never taken Texas and Northern Mexico we should never have had secession.
The sum of the matter is that colonization and territorial extension are burdens, not gains. Great civilized states cannot avoid these burdens. They are the penalty of greatness because they are the duties of it. No state can successfully undertake to extend its jurisdiction unless its internal vitality is high, so that it has surplus energy to dispose of.
Russia, as already mentioned, is a state which has taken upon itself tasks of this kind beyond its strength, and for which it is in no way competent. Italy offers at this moment the strongest instance of a state which is imperiling its domestic welfare for a colonial policy which is beyond its strength, is undertaken arbitrarily, and has no proper motive.
Germany has taken up a colonial policy with great eagerness, apparently from a notion that it is one of the attributes of a great state. To maintain it she must add a great navy to her great military establishment and increase the burdens of a population which is poor and heavily taxed and which has not in its territory any great natural resources from which to draw the strength to bear its burdens.
Spain is exhausting her last strength to keep Cuba, which can never repay the cost unless it is treated on the old colonial plan as a subject province to be exploited for the benefit of the mother country. If that is done, however, the only consequence will be another rebellion and greater expenditure.
England, as a penalty of her greatness, finds herself in all parts of the world face-to-face with the necessity of maintaining her jurisdiction and of extending it in order to maintain it. When she does so she finds herself only extending law and order for the benefit of everybody. It is only in circumstances like hers that the burdens have any compensation.