Fitiida UC-NRLF I $B 2fil bMD OF THK Econonuc Independence OF POLAND GIFT or Digitized by tine Internet Arciiive in 2007 witii funding from IVIicrosoft Corporation littp://www.arcliive.org/details/fundamentalcondiOOfrejrich Fundamental Conditions of the Economic Independence of Poland BY JOSEPH FREILICH. PH. D. f Tranalated from the Frenchj CHICAGO POUSH NATIONAL DEFENSE COMMITTEE 1918 PRES£«V«TION sC ^^ COPY AODED \\^ ^ <^ ORIGiNALTOBE O A ^ RETAINED \ GIFT Copyright 1918 by Polish National Defense Committee. • •• •• •'«' •«•••• • •' ISO Polish Peoples Publishing Co., Chicago, HI. PREFACE The problem of the economic independence of Poland, as the question of economic independence of state organisms, in general, is one of the most complicated problems of political economy. For it is certain that now, in this economic period of the twentieth century, characterized by a world-wide exchange of merchandise, there does not exist a single state organism which is econo- mically independent in the strict sen'se of the word. Even the most powerful contemporary states, from an economic point of view, that possess enormous forces of production and consumption, are not self- sufficient and can barely carry on an isolated econo- mic life. They are obliged to depend to a great extent on the politico-economics of other organisms, either as consumers or as producers but generally as con- sumers and producers at the same time. Only the earth, considered as a whole, constitutes a complete economic organism which is sufficient unto itself^ since naturally, it is forced to be so. .•4 \* But, the different parts of this organism, the 'States and countries that make up its constituent parts, cannot possess absolute, economic independ- ence : they are political organisms endowed only with relative economic independence. So examining, in our study, the conditions and factors of economic independence in Poland, we can have in view only those elements that, deciding the degree of her independence, result chiefly from the favorable situation of the elementary factors that, in the largest sense of the word, determine modern production, that is : natural resources, human work and capital. In addition to these principal factors there are still other important elements that must be considered, namely: the geographical situation of the country, access to the sea, and general means of communication with the world at large, that is to say, with all the other economic organizations of our globe. The Polish lands, at the present divided between the three partitioning States, Prussia, Rus- sia and Austria, condemned for more than one hund- red and forty years to vegetate in political and eco- nomical conditions entirely different, often opposed, considered as a whole, as one political and economical unit, undoubtedly respond to the conditions required by theory and practice, for the existence and development of independent, eco- nomic organisms. All of these conditions and factors, especially the natural wealth of Poland, and her geographical situation, by virtue of which her natu- ral and artificial ways of communication connect western Europe with the Orient, the Baltic Sea with the Black Sea, all these essential and secondary factors show that the Polish lands, as a whole, con- solidated into a state organization, will form a great economic organism, in the center of Europe end- owed with a serious force of expansion, possessing a degree of independence equal, at least, to tliat of the other countries of Europe which have been looked upon as economic organisms eminently in- dependent. The aim of this work is to retrace and to deter- mine the conditions and factors which constitute the basis of the economic independence of Poland. It is proposed to show the industrial evolution of Poland and to place in evidence the principal condi- tions that would considerably accelerate and facilit- ate this evolution. The degree of economic development of every politico-economic organism depends essentially upon its industrial development in quantity as well as in quality. The more a state possesses the character of an industrial organism, the more apt will its in- dustrial production be to meet the competition of the world markets with success ; the more will such an organism be considered as developed, firmly established and as possessing in itself the elements of its future expansion. Although before the European war, Poland did not have a distinctive industrial character, although much of her territory was agricultural, still taken as a whole, she possesses the fundamental conditions necessary to become an immense European in- dustrial workshop. But, in order that this may come to pass, the political and economic causes that have hindered the normal development of industry must be eliminated. The principal cause was the dismem- G berment of the Polish economic organism by the three sharing States. The formation of an independent Polfsh state, including all Polish territories, is a necessary con- dition of the future economic development of Po- land, and therefore, of the political and cultural development of that part of the European continent comprised between the Baltic Sea and the Car- pathians, between the Odra and the Polesie. I. THE INDUSTRIAL POLICY OF THE PO- LAND - SHARING STATES AND THE ECONOMIC INTERESTS OF POLAND The economic life of the country of the Poles, especially the industrial production, has developed under the unequal, and generally unfavorable con- ditions brought about by the economic policies of the three sharing States. These policies are essen- tially different for each part of Poland and take into very little or no account whatever Polish interests and requirements. In the Kingdom of Poland, (the part held by Russia) Which is the part of Poland most developed economically, the foundations of the national in- dustry were established by the local government of the Kingdom formed at the Congress of Vienna in 1815. A wide and methodical movement to im- prove and increas-e the industry of the country was undertaken by the government. All the merit of having brought the manufacturing industry to life and of having assured its progress should go to Prince Xavier Francois Lubecki, Treasurer of the young Kingdom and in charge of the direction of its finances toward the end of the year 1821. 8 Conducted systematically and with great energy by Lubecki, the industrial movement of the King- dom developed in two different directions. First, new industrial centers were protected and others created for the benefit of the Treasury. Then profit- able foreign markets were secured for the national products. The question of opening up outside mar- kets in Russia and the Extreme Orient, for the products of the Kingdom ; in other words, the ques- tions of transit and customs relations between the Kingdom of (Poland and Russia, were regulated through Lubecki in a most satisfactory manner. In fact, after this settlement of the custom relations on the basis of the tariff of 1822-24, the exchange of merchandise between the Kingdom and Russia could be carried on almost without import duty. The commercial policy of Russia at that time was highly prohibitive toward the western States, while the Kingdom of Poland possessed an auto- nomous Polish-Prussian and Polish-Austrian tariff (decisions of the trilateral commission; treaty of 1818 with Prussia, and of 1819 with Austria). This situation had a very favorable influence upon the development of the young and rising industry of Poland. The Kingdom of Poland became in part the finishing shop of foreign half-made products, espe- cially Prussian, which finally reached Russia as Polish products and, because of the Polish-Russian customs conventions, almost without import duty. Besides this system of custom relations, outlined above, between the Kingdom of Poland and the Western countries on the one hand, and Russia on the other, was favorable to a brilliant expansion of Polish industry, especially the woolen cloth industry. The .unfortunate result of the Polish insurrec- tion of 1830-31 was felt not only in the political and cultural life of the Kingdom but in its economical life as well. The Russian government, as soon as the ilames of the revolutionary fires were smothered, made haste to modify the Polish-Russian custom and commercial conventions, which as has been stated, had such a very favorable influence upon the development of the economic life of Poland. At the beginning of the month of November, 1831, new custom tariffs for transit goods were worked out and introduced, that were to regulate the exchange of merchandise between the Kingdom and Russia. These new rates were manifestly dis- advantageous to Polish industry and commerce and were made purposely as reprisals. The result was an important emigration of Polish manufac- turers. Some moved their manufactories into Russia, while others built new factories on the other side of the customs frontiers but still near the Kingdom. Thus, the growth of industry in and about Bialy- stok began. However, notwithstanding the severe Russian custom tariff reprisals, that lasted nearly twenty years, Polish industry did not die out. Only those enterprises that were financially weak and without ■economic vitality were ruined. Instead, the industry of the Kingdom spread out into new lines of produc- tion and began, in larger measure, to take into ac- count the needs of the home markets, and, though less rapidly than in the time of the constitutional Kingdom of the Congress, continued to develop. 10 The year 1850 was a turning-point in the history of the politico-economics of Russian-Poland. Under the influence of different important factors, the Russian government decided, towards the end of the forties of the last century, to break off from the prohibitive system and to replace it by a more lib- eral tariff. At the same time, in St. Petersburg, (for purely political reasons), the question of the unifica- tion of the Polish-Russian customs and of extending the new Russian tariff to the western frontiers of the Kingdom of Poland was brought up. After long deliberations and preparatory work, the project of the unification was realized in April, 1850. It was then towards the end of 1850 that the independent position of the Kingdom of Poland (in its commer- cial policies) was suppressed. Since then this part of Poland has remained incorporated in the econo- mic organism of Russia, and as a result of this, the industry of the Kingdom has developed within the limits of conditions created by the Russian tariff policy and, in general, by the Russian economic po- licy. The suppression of the Polish-Russian custom frontier was of great importance to Polish industry. The Russian markets opened to Polish industrial products, and transit commerce with the markets of Oriental Asia again sprang into life. Moreover, the new Russian customs tariffs, without giving com- mercial liberty, allowed a certain liberalism. They were favorable to the interests of the Kingdom of Poland by their relatively low import duties on raw materials and textile half-products. Then too, they hindered the foreign importation of certain productvS (sugar, alcohol, beer) and favored the development 11 of the principal agricultural branches of industry of the country. The utter change brought about in 1850 in Po- lish-Russian tariff and commercial relations, and in the tariff policy of Russia itself, contributed to the progressive transformation of industry. A series of secondary causes (the blockade of Russian ports during the Crimean War, construction of railroads in Poland and Russia and the economic conse- quences of the next to the last Russian-Turkish war) also helped to change the small industries and manufacturing establishments that existed before 1850 into a great capitalistic industry. The strong protectionist tariff of Russia, begun in the seventies of the last century, although originally brought out for fiscal motives, accelerated industrial concentra- tion in the Kingdom and favored the growth of new establishments and new centers of production. So^ during this period of rigorous protectionism, that lasted from 1887 up to the beginning of the Europe- an war, Polish industry gained strength, acquired all the attributes of a great capitalistic production and showed a marked tendency toward concentra- tion. Poland lost, during this period, the character of an agricultural country and (became, side by side with Upper Silesia, a fundamentally industrial re- gion. Although Polish industry has expanded prin- cipally during the last forty or fifty years, that is to say, during the period of the protectionist policies in Russia, it would be wrong to conclude that it was only because of state protection that it developed, or that the Russian customs policies had only a favor- able influence upon it. 12 In fact the aim of the protectionist customs po- licy, as well as of all the industrial policies of Russia, was above all, for the protection of the industries in the Russian Empire properly speaking, in those provinces only, which were actually Russian. Likewise in transports, tariffs and in the whole fiscal question generally, the needs of the Russians were first taken into consideration and these very often clashed with the needs and interests of Polish industry. This partial attitude has become signally obvious during the last twenty or twenty-five years. The Russian customs policy, that for forty years had been extremely protectionist, first from purely fiscal motives, reached its culminating point in 1894, after the conclusion of the treaty with Germany. Until then the Russian government had protected, by an adapted system of customs tariffs, the manu- facture of finished products ; after that they under- took to protect the half-products and raw material. The principal object that led the government to take this course was to accelerate or even to create Rus- sian production of raw materials or half-products such as metal ores, coal and coke, and especially cotton, pig-iron, etc. (Polish industry suffered from this extension of the Russian protectionist customs tariffs be- cause it was based in large measure on the im- portation of raw materials from abroad. In fact, there are no cotton (plantations in Poland or in Europe and the coal mined in the district of Dombrowa (that part of the Silesian-Polish coal district that is in Russian Poland) is unfit for the production of metallurgical coke which is indis- 13 pensable in modern iron industry; the Polish iron-ore which contains only 30 or 40% of metal, is only used together with richer ores that must be imported. Then too, the relatively high import duties on foreign cotton (from America and Egypt), on coke (from Upper Silesia and Karwi- na-Ostrowa) and on the ores (from Sweden and France), established by the Russian government to protect the cotton production in the Caucasus and Turkestan and the coal and coke industry, as well as the metallurgical products of South Russia, have burdened considerably the industrial pro- duction of the Kingdom. The very high import duties on cotton and the different kinds of thread had a most unfavor- able effect on the cotton industry of Russian Po- land. For although the increase in the cost of pro-^ duction has not hindered the powerful develop- ment of the Polish textile industry, still it has had a harmful influence by making competition with the Russian textile industries on the Russian home markets still more difficult. Moreover, it is only because of this high import duty on foreign cotton that the use of cotton from Turkestan, and the Caucasus has grown so extensively during the last twenty-five years. In 1890, 135,000 tons of raw cot- ton were used in the Kingdom of Poland, of which about 32,000 tons were Russian. In 1900, 270,000 tons, of which 100,000 were Russian, and in 19110, 355,000 tons, of which about 180,000 were Russian. Thus, Russian cotton of an inferior quality and more expensive, is being used more and more because of the protective tariff on imported cotton. During the years preceding the war the amount of Russian 14 cotton reached at least 55% off the entire quantity used. The import duties on coal and coke, as well as on iron, imported from western and northwest- ern countries of Europe, have also been the cause of much loss to Polish industry. Because of the lack of coke production in the Kingdom of Poland, the Polish metallurgical industry has been ob- liged to import coke from Upper Silesia, Siksia of Cieszyn and Opawa. But the Russian government, to protect the coke production and the metal- lurgical industry of southern Russia, fixed high import duties on coke ($0.50 a ton). Considering the relatively large quantities of coke imported (55 to 60 thousand car loads a year) for the metal- lurgical factories and the other industrial establish- ments, these import duties have burdened, without any compensation, the Polish metallurgical pro- duction, and in consequence, increased the price of pig iron and of all metal products, machines, utensils, etc. Thus, the Russian tariff policy, guided exclusively by the interests and needs of Russian industry, systematically caused great losses to the metallurgical industry of Russian Po- land. The same thing may be said of many other branches of Polish industry. The high duties on coal, pig-iron and other raw materials have been directly prejudicial to many other branches of Polish in- dustry, as well. The Russian transportation system, especially in its tariffs, also shows the indifference and even the ill-will of the Russian government toward the needs and interests of Polish industry. The lack of lines of communication on land and 15 water, especially the inadequate railroad system, together with the absolute subordination of the most vital economic interests of the country to strategical considerations, has had a very harmful influence on industrial production by holding up the transporta- tion of raw materials and fuel to factories, by hin- dering the transportation of manufactured mer- chandise and by decreasing the extent of the home market. Besides which, in certain parts of the count-- ry, near the borders, for example, the national pro- ducts could not withstand the competition of foreign products because of the irrational configuration of the system of railroads that had been built for mili- tary purposes. A striking example of this abnormal situation was the increase in the use of coal from Upi>er Silesia (that is to say, according to the fron- tiers existing before the war, foreign coal) in those parts of the country that could not be reached except in a roundabout and therefore more expensive way from the mines of Dombrowa. The Russian railroad tariff policy favored chiefly the importation of Rus- sian grain, raw material and textile products into the Kingdom and abroad and at the same time limited the exportation from the Kingdom toward the interior of Russia or .abroad. The Russian industrial tax policy was also unfavorable to the development of Polish industry, as, in a general way, all the tax policies of Russia were. Competition was made easy for industries that were really Russian and they showed great force of expansion. In a word, the industrial as well a*s the economic policy of Russia, taken in a general sense, was marked by indifference and ill-will towards the real 16 economic needs of Polish industry and towards the entire economic life of Poland. In the old conflict between the industries of the Kingdom of Poland and those of Russia proper, that reached its height in the competition between the textile industries of the two countries — in the struggle between Lodz and Moscow, the Russian government openly took the part of Moscow. This government protection given to Russian industries made competition, on the markets of Russia and the Extreme Orient, much more difficult for Polish industries. Still more sig- nificant, the consequence of this was an increase during recent years in the importation of Russian merchandise, onto the markets of the Kingdom. This importation included not only raw material such as iron ore, pig-iron and cotton, but more especially the manufactured textile products. The Oriental markets that served as bases for these false and erroneous political notions, showed, as Russian industry favored by the government developed, an unexpected instability. The isituation of Polish in- dustry on the markets of the Orient, not only became from year to year more difficult and disadvanta- geous, but further, Russian industry began to win over the western markets, that is, Polish markets, to the evident detriment of the industrial interests of the Kingdom. * * * The general development of industrial produc- tion in the Polish provinces forming Prussian Po- l(tand, (the Grand Duchy of Posnania, Western or Royal Prussia, Eastern or Ducal Prussia, and Upper Silesia or Silesia of Opole), taken as a territorial and economic whole, has been, up to the present 17 time, comparatively small. This vast territory, hav- ing an area of about 10.000 square kilometers with a population of 8}^ millions, is pre-eminently an agricultural country, with the exception of the south-eastern part situated between the Odra and its tributary, the Malapane, that forms the rich and very extensive coal fields of Upper Silesia. The absence of well developed industry in the Prussian part of the Polish lands (except in Upper Silesia) is explained by several important causes and factors. First, all of this western and north- western part of Poland is lacking in minerals. In the Grand Duchy of Posen, in Western Prussia and in Eastern Prussia, there are no coal fields or metal ores of any value. It is well-known that such de- posits form one of the principal factors of industrial development. The great extent of this fertile land and the agricultural and protectionist policies of Germany which are favorable to agriculture, have directed • the efforts of almost all the population of these provinces to the tillage and cultivation of the soil. Other secondary causes were: the German transportation policy that was largely governed by strategical motives and concerned with the Interests of German industrial production ; insufficient canal- ization of the Vistula and Niemen rivers inside the Russian boundaries that was unfavorable to the speed and cost of transportation and importation of raw materials from the Kingdom of Poland and Lithua- nia to factories and industrial establishments situat- ed in Prussian Poland ; and lastly the constant emigration of competent workingmen to the western provinces of Germany, where, for different reasons, conditions were more favorable for the working 18 clasis. The result of all this was a very small indus- trial development in the Grand Duchy of Posen and in Western and Eastern Prussia. But on the contrary, the fourth province of Prussian Poland — Upper Silesia — possessing im- mense mineral wealth in coal, zinc-ore, iron and lead, has become, in the last forty or fifty years, a powerful center of production, one of the largest in Poland and one of the most important m Europe. In the southern and isouth-eastern parts of Upper Silesia (in the centers of Katowice, of Bytom, of Zabrze, of Huta-Krolewska, of Tarnowskie Gory, of Gliwice, of Pszczyn, of Rybnik and of Opole) other industries besides the mining of coal and mine- rals have developed, such as metallurgical coke, steel, chemical, cement and mechanical industries. Thus, of all the provinces of Prussian Poland Upper Silesia alone, has developed into a great center of industry and is the most industrial region itn all Po- liand. Industrial production is new in the other pro- vinces of Prussian Poland, especially in the Grand Duchy of Posen and in Western and Eastern Prus- sia and has no rich or instructive past. But the min- ing and metallurgical industries of Upper Silesia with its immense coal basin are already old and have a history full of interest. It is sufficient to call to mind that it was here, in Upper Silesia, in the lead mine Frederick, that the first steam engine ever built on German territory was erected in 1788; it was here also in 1795, in the metallurgical factory of Gliwice, that the first blast furnace was built. Quite as interesting as the history of the techni- cal development of this industry in Upper Silesia is 1^ its politico-economic history, comprising all the transient periods that led from a production, inisign- ificant and purely local, to the present powerful one, of European importance ; comprising all the tragic episodes for Polonism, and above all, the con- fiscation of Polish domains in the reign of Frederick The Great, that were then delivered up, soil and sub- soil, to foreigners, enemies of Poland. In general, as far as the ownership of industry was concerned, the situation in Prussian Poland developed unfavorably for the Poles. Industrial production was neglected by the Polish nation, chiefly because of the peculiar social economic or- ganization of the population in this region of the ancient Republic. Be/sides, working conditions were exceptionally difficult, brought about not only by the natural difficulties but also by the hostile atti- tude of the Prussian government in regard to Polish industry. These obstacles, until quite recently, have hindered the development of Polish industrial labor organizations, they have weakened the development of concentration and hindered the creation of new industrial establishments, directed and worked by Poles. On the other hand, the Prussian government hais spared neither energy nor money to accelerate, facilitate, and support the foundation and develop- ment of German industrial enterprises. In doing this, the government and its representatives have been guided exclusively by anti-Polish political motives. In its determination to Germanize Prussian Poland, the Prussian government has attached great importance to this economic struggle against the Polish population. Thus, they tried systematically 20 to create a well-to-do German middle class in the cities of Prussian Poland by protecting German tradesmen and by favoring the development of small German industries. But in this economic struggle, the artificially protected German middle class could not hold out against the energetic competition of the young Polish bourgeois, tradesmen, merchants and small manufacturers and were obliged, little by little, to yield their places to the Poles. Thus, those in Prussian governmental circles were led to the conviction that in the field of small production the German immigrants, who had been encouraged to settle in the towns and villiages of Prussian Poland, could never assert themselves; that only a capital- istic production would do away with Polish com- petition. Among the partisans of this ^system for the Germanization of Prussian Poland, was Dr. Gosler who for many years occupied the position of Super- President of Western Prussia. In 1898, after having made a study of the western and central industrial centers of Germany, Gosler began to establish new German industrial enterprises in Prussian Poland. At Danzig in 1890, with the co-operation of the German banks and the Super-Presidents of the Grand Duchy of Posen and of West Prussia, Dr. Gosler established a special institution for the pro- tection of German industrial enterprises in the eastern provinces, (Centralstelle zur Foerderung industrieller Unternehmungen in den oestlichen Provinzen). This institution took part in the creation of several large German industrial enterprises in Prussian Poland, especially in East and West Prus- sia. But many of these enterprises that had been 21 founded to fill political rather than economic needs lacked vitality and soon failed. However, the Gosler movement, supported by the great German bankers and profiting by state protection, certainly strength- ened German industry, especially capitalistic in- dustry in Prussian Poland. The highly protectionist system applied by the German government to German industry in Prus- sian Poland, was clearly shown by the personal and official actions of the highest government officials in the different Polish provinces. Besides this, the hostility of the Prussian government towards Polish industry was shown in a striking manner by the government boycott of Polish enterprises. In fact no Polish industrial establishment and no fac- tory or manufactory, belonging to Poles ever receiv- ed a State order, though it is a well kmown fact that the Ministers of the Army and Navy, of Railroads and Government Mines are the chief clients of Ger- man industry. In Prussian Poland, German enter- prises received all government orders while Polish enterprises were, on principle, set aside. Thus, the policy of absolute boycott against Polish industrial enterprises that has been rigor- ously practiced for many years by the Prussian go- vernment and the state organizatians of the German Empire, has hindered the expansion of industry in Prussian Poland. Especially .so, since only a rational protective attitude taken by the State, as a con- sumer, could have contributed to the development of Polish industry, because of the small capacity of the local markets and the total impossibility of with- standing the competition of the (powerful west aind central markets of the great German industries. It 22 must be added that this absolute boycott of Polish industrial enterprises, practised by all the central and local organizations of the German and Prussian governments, was continued by the autonomous authoritie's and public institutions such as the Provi- sional government, County Supervisors, Councils and City Administrations. The latter, by a selective, electoral form of government, are mostly in German hainds although in many of the towns of Prussian Poland the majority of the population is Polish. German banks in the cities of the Grand Duch) of Posen, of Western and Eastern Prussia and Upper Silesia have also been of great service to German industry. These banks have always consi- dered their principal task to be the protection of German commerce and industry in Prussian Poland and as they were cloisely connected with the great- est banking industries of Germany, the advantages thus gained were considerable. The Polish in- dustrial enterprises in the meanwhile were obliged to rely almost entirely on the Polish credit organi- zations, fortunately well developed, though of course much less powerful than the German organi- zations supported by the great Berlin banks. It was then, the anti-Polish policy of the Prus- sian government that retarded the development of industry in Prussian Poland by the boycott of Polish enterprises and also by dispossessing Polish land- owners and establishing German colonies on the land taken forcibly, for themselves, from the Poles. All this Prussian policy hindered the expansion of the productive forces of the country and weighed down the production with too heavy burdens. The productive forces of the country, mainly agricul- 23 tural, suffered from the high prices of land caused for one thing by the colonization policy of the Prus- sian government, that lowered the rates of income and thus brought about a decrease in the capacity of the home markets in Prussian Poland. This situation was beneficial to a small number of German manu- facturers and Prussian bankers. By threatening to sell their property, involved in debt, to the Poles, they always succeeded having it bought, very advantag-eously for themselves, by the Prussian co- lonization committee. In Austrian Poland, in Galicia and In Silesia of Cieszyn, conditions have also been very unfavorable to economic life and industrial production. Aside from Silesia of Cieszyn (that includes a part of the coal district of Karwina-Ostrawa where, near the town of Bielsk, the coal and textile indus- tries developed) in the rest of Austrian Poland, that is to say, in Galicia, which makes up the greater part of it, industrial production has developed very little. Yet Galicia has immense natural wealth, — magni- ficent coal beds in the district of Cracow ; petroleum fields, perhaps the largest aind richest in Europe ; the celebrated salt mines ; besides beds of all kinds of clay, which are the raw products used in the manufacture of pottery. Still, in spite of all this wealth, until recent years, Galicia has been from the industrial point of view the moist backward region of Poland and the part having the least industrial development. 24 This unfavorable situation in Galicia has been caused chiefly by the retrograde industrial and eco- nomic policy of Austria. "The concepts of industry and those of Austria", isaid Mr. M. P. Morawitz, Director General of the Anglo - Austrian Bank of Vienna, in March, 1908, at a meeting of Austrian economists, "are not the same. Industry is the expression for the highest progress while Au- stria in many respects, still lives on in the epoch be- fore 1848. This is why the juxtaposition of these two terms is in a way a contradiction. It is as if one spoke of the sunny skies of London". This true characteristic has been confirmed in the backward industrial and harmful custom policies of Austria; a policy that has delivered Galicia up to the power- ful Austrian industrial trusts and to the Austrian government that have treated this part of Poland as a colony to be exploited to the utmost. The import duties on industrial products are such that the trusts of western Austria, that is to . say, the manufacturers of Vienna, Bohemia, Mora- via and of Styria can force high prices in the Gali- cian markets on the most necessary industrial artic- les. Supported by the central authorities at Vienna, their influence is such that no industrial establish- ment can be founded in Galicia without the consent of the trusts of that branch of industry. Needless to say, the trusts have obstinately opposed the estab- lishment of new centers of production in Galicia. Long yeai^s of experience and observation of the policies of the trusts have proven that Galicia has been treated as a market and not as a center of pro- duction. The government is entirely indifferent to this policy of the trusts that is so harmful to the in- terests of Galicia. But what is worse, they often in- directly uphold the hostile actions of the trusts of W«stern and Central Austria, and it is only in ex- ceptional cases that the government will give way to the Polish representatives in the Viemma Parlia- ment. The Austrian policy has acted as a check to the industrial development of Galicia through taxes levied on industry. The comparison that has been made so many times between the rates of the pro- fessional taxes of Austria and those of other states shows a difference prejudicial to Galician industry. This state of things was made worse by a system of supplementary taxes in autonomous lands ; provin- cial, district and township taxes. In Galicia these supplementary taxes that were most harmful to the expansion of industry greatly exceeded the taxes in other parts of Austria. This was the consequence of certain peculiarities of the Austrian fiscal legislation and also because of the precarious situation of the Galician finances. Austria's indifference to the industrial and eco- nomic interests of Galicia is shown also In a striking manner by her transportation policy. This policy was distinguished from the first by the two follow- ing characteristics : first, the Austrian government estimated each new line of railroad in Galicia from a strategical point of view and then, methodically neglected the economic needs of the country and, as has already been said, this neglect was the result of the fact that Galicia was considered merely as a near by and convenient market for the industry of the western provinces of Austria. The system of Gali- cian railroads, like those in Russian and Prussian 26 Poland, were not only insufficient but irrational and responded in no way to the economic interests of the country. The government has been just as inactive in the conistruction of highways. It was only through the energetic efforts of the autonomous govern- mental bodies that, during the last fifteen years, roads have finally been constructed, and again the Vierwia government brought pressure to bear to have strategical highways built. The State policy in regard to the interior waterways of Galicia, showed the same neglect, the canal question became almost a scandal. Work was held up for nearly eight years on the canal from the Vistula to the Odra. This work that had been prescribed by law, voted and sanctioned by the Parliament, was hindered by the malicious policies of the government. It was only in 3911, under pressure of the Polish representatives in Parliament, that the government decided to un- dertake this work and that finally construction was begun. In a word, in Austrian Poland as well as in the other parts of Poland, although perhaps in another form, economic life, especially the development of industrial production, was hindered by the peculiar and unfriendly policies of the government, that were manifest in all branches of economic activity. So, the economic policy of Austria, together with her organic and social defects, was the cause of the lack of industrial development in Galicia and thus, in spite of her enormouis wealth and great reserve of man-power, Galicia became the country that, unable to export her industrial products, was compelled to export human beings. Galicia of all the 27 Polish provinces had the gireatest emigration — to her inational and material detriment. In the foregoing pages we have retraced the principal factors that have combined in the three parts of Poland to hinder the development and growth of economic and industrial life. Neither in- dustry nor commerce and to a certain degree, not even the agricultural production, has had the real protection of the state. In the western countries of Europe, experience has shown the great importance of the protection of the state as a factor in develop- ment, when rationally and sincerely applied. With- out this friendly protection, industry, commerce and rural economy have been unable to make full use, for production and exchange, of all the natural wealth that abounds in the Polish countries ; have been uiniable to benefit fully by the favorable geographical situation, and have been unable to use the immense reserve of man-power of which Poland disposes. The attitude of the sharing governments in regard to the economic needs of the different parts of Poland has been the typical attitude taken by foreigm conquerors towards the country con- quered. II. DESCRIPTION OF THE DEVELOPMENT OF THE INDUSTRIAL PRODUCTIVE FORCE OF THE POLISH COUNTRIES. Industrial life in the Polish countries has deve- loped under generally unfavorable conditions. There has never been a loyal state protection of industrial production, on the contrary, the economic policies of the sharing States adapted to their own fiscal needs, taking into account first of all the industrial inte- rests of Rusisia, Germany or Austria, often hindered the industrial development of Poland. Yet in spite of all these unfavorable conditions, industrial pro- duction in Poland — because of the great natural wealth of the country, its geographical situation, and great reserve of manual labor — developed con- siderably. From the point of view of industrial develop- ment, Poland, taken as a territorial and economic whole, certainly occupies an important place among the European states. In fact, in the Kingdom of Poland, in Prussian Poland (Upper Silesia, the Grand Duchy of Posen and Western Prussia) and in Galicia there were according to the statistics of 1907-1910, from twenty- two to twenty-five thousand industrial establish- ments (not including the small artisan shops) em- ploying more than nine hundred thousand men, and liaving an annual production of 5 billion francs. '2'.} Table I. gives the detailed distribution of work- ingmen according to different branches of industry in different parts of Poland. Table I. — Number of workingmen employ-ed. Kingdom Prussian Industry of Poland Poland Galicia Totals Textile 150,000 8,000 5,000 163,000 Food industry 43,000 60.000 21,000 124,000 Metals 62,000 60,000 11,000 133,000 Mines & metallurgy 46.000 150.000 18,000 214,000 Garments 25,000 20,000 1,000 46,000 Mineral 23,000 40,000 20,000 83,000 Chemical 9,000 9,000 5,000 23,000 Animal products ... 7,000 3,000 1,000 11,000 Paper & printing... 15,000 10,000 6,000 31,000 Wood 17,000 40,000 12,000 69,000 Various 3,000 3,000 Totals: 400,000 400,000 100,000 900,000 There were in round numbers, nine hundred thousand workingmen engaged in industrial enter- prises in all parts of Poland, four-ninths in the Kingdom of Poland, four-ninths in Prussian Poland and only one-ninth in Galicia together with the Grand Duchy of Cracow. To this important figure must be added the one hundred thousand laborers working in the mining and industrial establishments of Silesia of Cieszyn, and in the manufactories of the district of Bielsk. This gives a positive figure of at least one million industrial workingmen employed in the Polish countries just before the outbreak of the war. This is a minimum figure because the five years preceding the war were a period of great in- dustrial activity in the Kingdom of Poland and in Upper Silesia. During this period a large number of important industrial establishments were founded in the Kingdom of Poland, which increased the 30 number of factory laborers. During this same period also the mining and metallurgical industries of Upper Silesia developed rapidly. Table II. brings out bettter the intensity of in- dustrial production. This table shows in francs the value of the production of different branches of in- dustry in the three parts of Poland. The total value of industrial production in the Polish countries, included in this table according to calculations for 1910, are about 4,900,000,000 francs. Considering that the value of production in Silesia of Cieszyn and in the district of Bialystok was at least 300,000,000 francs, it can be approximately estimated that the total value of the industrial pro- duction in the Polish countries was b% billion francs, since during the last five years preceding the war, industrial production in Upper Silesia and in the Kingdom of Pola)nd had a very vigorous and rapid growth. The statistical data in these two tables, giving the number of workingmen occupied in industrial establishments and the value of the production of different branches of industry, show likewise the interior structure of Polish industry. Thus Polish industry is characterized in general by two principal features: first, by a great develop- ment in mining and metallurgical production, amounting to a billion francs a year, (including the production of Silesia of Cieszyn) then, an important development in manufacturing industries, such as the textile, garment and metal industries. During the years 1907-10, the total value of the production of the different branches of these manufacturing industries amounted to 1 billion 800 million francs 31 c o (J :3 o 5 '^ el 5 o ^ o o o o o o o o o (^ o o o o o o o o o o o o^ o o o o o^ o_ o o o o o o* o o" o o o o o o o o o o o o^ o o_ o o o o to o o oo" t-^ o © a> OS CO 00 -^ to £0 *1 M* CO C>J tH CO ec W CO « M N ©O©© ©©©©©©©o ©©©© ©O©©©©©© ©©©©_^ o©©©©©©© CM T»< lo t» cvj 00* 00* oi' eo* «o" la •V NeCWtH ©rllCOOOO.-loO-*' t--coi-)«oc0 © © o o © © © © o o f~y ^ © o o o © o o o eo uo in r- o 00 o o> t- t- OS «c Ol CM t- t- 00 iH © o> o © iO fO ia «' CM ©^ -^r M CM -^r C5^ t>._^ T-< 00 ^. '^^ 00 00 00 OS OS ^ ©©©©©©©©©oo©© ©©©©©©©©©©oo© ©©©©©© ©_^o©__ ooo© ^^^ © ©* eo ©* ©* © © ©* ©" ©" ©" ©* ooookn©oifl©©coirtiococM t-^OWCMTHt^©00«000'*>-l'* 00 OS © ■^ eo os" lo i-T m" t-J' oo co V CM»-(cococoeomt-«e«o«Di-«) CMCMCMCMCMCMCMCMCMCMCMCMCM ©i-HeMco^ia«ot^ooo5©f^ ©©00©©©©©©r-<^ osososososososososososos 45 A more significant fact is that, during the per- iod from 1900 up to the war, the production of the Silesian-Polish coal fields showed the greatest acceleration of productivity in Europe, excepting only Russia. In fact, the output of coal in Poland during this period increased about 70% ; in England only from 16 to 20% ; in Germa^Ky 50 to 60% ; in France 22 to 25% ; in Austria only 15% ; while in Belgium it remained about stationary. Only in Rus- sia was the increase greater, being 81%. Besides, the Silesian-Polish coal fields are still far from having ireached their culminating point and can, un- der economic and political conditions favorable to Poland, accelerate even more the already remark- able rapidity of their development. These coal fields then, from the unmistakable evidence of the figures in table IV, make a powerful foundation for the whole organism of Polish industrial production. The Silesian-Polish coal basin that contains in the districts of Upper Silesia and Karwina-Ostra- wa much valuable soft coal is one of the most im- portant centers of coke production in Europe. Soft coal is found in Upper Silesia (district of Upper Sil- esia) and in Silesia of Cieszyn (district of Karwina- Ostrawa). In Russian Poland beds of soft coal, fit for coke distillation, have not yet been found, but in Galicia (district of Cracow) there are beds of soft coal that have not yet been worked. This is one of the reasons for the small development in the output of fuel in this large and rich part of the Polish-Silesian basin, and yet, although the rich deposits of soft coal are insufficiently exploited, still coke production in the Polish countries, that is to say, in the Silesian-Polish basin, has become 46 most important. During the last twenty-five years, especially during the last fourteen years from 1900- 1913 inclusive, the coke production in the Silesian- Polish coal fields was as follows. Table V. , — Production of coke (metric tons). District District Year of of Totals Upper Silesia Karwina-Ostrawa 1890 987,950 587,313 1,575,263 1895 1,029,485 650,873 1,680,368 1900 1,306,557 1,145,222 2,451,779 1901 1,168,472 1,208,768 2,377.240 1902 1.095,468 1.100,320 2,195,788 1903 1,139,160 1,108,544 2,247,704 1904 1,270,793 1,219,435 2,490,228 1905 1,327,335 1,331,807 2,659,142 1906 1,471,530 1,605,832 3,077,362 1907 1,514,062 1,772,736 3,286,798 1908 1,564,798 1,780,576 3,345,374 1909 1,493,170 1,896,924 3,390.094 1910 1,523,966 1,913,285 3,437,251 1911 1,723,226 1,975,243 3,698,469 1912 1,939,619 2.225,335 4,164,954 1913 2,055,582 2,500,000 4,555,582 This table shows that during the last twenty- five years, (especially 1900-13) the coke production of the Silesian-Polish coal fields increased greatly. The most rapid increase was in the district of Kar- wina-Ostrawa, where, during this given period, the output of the coke furnaces increased 32i5%. During the same period the increase in the output of the Upper Silesian furnaces was only 108%, while for the same period the total coke production of the entire Silesian-Polish basin increased 190%. The development of the coke production in the Silesian-Polish basin has been retarded partly by 47 the prohilbitive Russian tariffs, that hindered by high custom duties, the importation of coke into the Kingdom of Poland, and partly by the policies (protected by the government) of the Austrian trusts that prevented the establishment of iron and steel works in Galicia. There is no doubt, however, that the reserve of soft coal in the Polis'h-Silesian basin, as well as the producing capacity of the coke factories there, will not only be enough for the needs of the iron and steel works already existing in the country but that there will also be enough to meet the demands of Polish manufacturers even in the remote future. Thus the steel and iron production which plays such a role in all producing and in- dustrial organisms is not only assured in Poland but disposes of a very important factor of develop- ment. To sum up, the Silesian-Polish coal basin, being one of the richest in all Europe, constitutes a reserve of heat energy from which the economic and in- dustrial organisms of Poland and of all the adjacent countries will draw their strength. It constitutes one of the principal conditions of existence for the progressing industry of the country. It is also one of the principal factors of the future growth of Polish industrial production and one of the most important guarantees that Poland as a state, politi- cally independent, will also be economically in- dependent, at least to the same degree as the States of western Europe which have reached a high level of economic development. IV. THE NATURAL WEALTH OF POLAND. Beside the immensely rich Silesian-Polish coal fields, there is other important mineral wealth in Poland that will add to the development of her future industries and to her economic independence. The second place in the mineral wealth of Po- land is occupied by lead and zinc, also very impor- tant in economic life, that are not only connected by their origin but very often appear together. The richest beds of lead and zinc are found in Upper Silesia (the carbonate of zinc and the sulfide of zinc) where the output is 90% of the whole produc- tion of Poland. Other mines of these metals are found in the Kingdom of Poland near Olkusz, and also in Galicia near Cracow. In Austrian Silesia the output of lead and zinc, up to the present time, has been insignificant. It must be noted here that a more exact valuation of the zinc and lead ore is impossible but it is certain that there is a consider- able amoumt. Table VI gives the output of zinc and lead in the Polish countries for the period of twenty-five years from 1890 until the outbreak of the war, (especially for the period 1910-13). This table shows that the output of zinc and lead during this period fluctuated between 650 and 700 thousand tons. Thus in the production of lead 49 Table VI. — Oi res of zinc and of lead extracted (metric tons). Upper Kingdom Year Silesia of Galicia Poland Totals 1890 676,150 " " 17,658 693,808 1895 582.987 56,160 10,494 649,631 1900 576,305 49.441 10,070 635,816 1901 573,240 57,315 8,130 638,685 1902 629,927 67,261 7,548 704,736 1903 614,966 74,969 12,073 702.008 1904 653,159 101,588 10,325 765,072 1905 666.144 99,437 9,381 774,962 1906 633,593 68,919 5,863 708.375 1907 633,610 62.040 9,032 704,682 1908 646,524 63,532 7,951 718,007 1909 664,202 52,165 7,386 723,702*) 1910 591,475 58,980 8,161 658,616*) 1911 552.449 55,051 6,811 614,311*) 1912 583,503 59,568 8,873 651,944*) and zinc, the Polish countries occupied the first place in Europe, being only surpassed in the whole world by the United States of America. The rel- ation of the output of zinc to that of lead was as eight to two; in other words, for this given period, 520 to 560 thousand tons of zinc ore and 1^0 to 140 thousand tons of lead ore per year. As a result of the 'relatively important produc- tion of zinc and lead iin the Polish countries, the metallurgical industry has been greatly developed ; before the war there were factories in Upper Silesia, in the Kingdom of Poland near Olkusiz and Ben- dzin and also in Galicia near Cracow. The output of lead ore from Olkusz and the mines near Cracow *) In the Silesian district of Cieszyn the numbers of tons of «lnc and lead ores extracted during the years 1909 to 1912 were respectively: 50, 15, 60 and 70. $0 was sefnt as raw material to the factories in Upper Silesia where it was melted into lead. Thus the production of raw zinc and lead, espec- ially zinc, in the Polish countries, equaled that of Belgium which, before the war, occupied the first place in Europe and the second place in the world after the United States. In table VII and VIII the figures show the development of the production of zinc and lead in Poland during the last twenty-five years. Table VII. — Production of zinc (metric tons). Upper Kingdom Year Silesia of Poland Galicia Totals 1890 88,699 3,776 2,173 99,648 1895 95,430 5,034 2.526 102,990 1900 102,213 5,967 3.365 111,545 1901 107,967 6,109 3,683 117,759 1902 116,979 8,271 4,898 130,148 1903 118,522 9,902 5,518 133,942 1904 126,493 10.612 5,770 142.875 1905 129,013 7,638 6.550 143.201 1906 135,970 9,380 7.526 152.876 1907 137,736 9,392 8,302 155.430 1908 141,461 8,841 9.721 160,023 1909 139,255 7,947 8,358 155,560 1910 139,733 8.638 8,866 157,237 1911 155.628 9,937 11,878 177,443 1912 168,496 8.764 13,222 190,482 1913 169,439 7.608 13.850 190,897 These figures show that there was an immense development in the production of zinc ore in Poland. After the Belgian production, that of Poland is the most important in Europe and third in importance in the world, furnishing more than 21% of the entire production of the world. From the point of view of lead production, the Polish countries also occupied an important though not predominant 51 place among the world producers of lead. The position of the Polish lead metallurgical industry is prominent. In the production of lead in Europe before the war, Poland was only surpassed by Spain, Germany and Belgium. Thus, the wealth of zinc and lead in Poland is yet another important factor in the economic independence and industrial development of Poland. In economic value, iron-ore is known to occupy the second place after coal. Iron-ore is found in dif- ferent parts of the Polish countries and over large areas. A valuation of the reserve of iron-ore, even approximate, is difficult, because of the lack of suf- Table VIII. - — Production of lead (metric tons). Year Totals Year Totals 1890 19,622 1906 38,372 1895 20.017 1907 32,937 1900 24,925 1908 38,381 1901 22,733 1909 37,360 1902 30,209 1910 41,261 1903 42,191 1911 41,811 1904 39,795 1912 41,313 1905 50,973 1913 39,922 ficient data, but it is estimated that the reserve of iron-ore in the Kingdom of Poland is from 300 to 350 million tons, containing from 120 to 140 million tons of iron metal. There is about the same quantity of iron-ore in Upper Silesia. There is none at all in Silesia of Cieszyn and very little in Galicia, but as there has never been a thorough geological survey made of the Kingdom of Poland and Galicia, it is probable that the approximate estimation of be- tween 700 and 800 million tons is far too low. 52 There are four principal centers where iron-ore is found in Poland: 1st in Upper Silesia, in the Si- ksian-Polish coal basin ; 2nd to the south and north- west of Czenstochowa, 3rd in the government of Radom, in the neighborhood of the Holy Cross Mountains, 4th south of Kalisz where, during recent years, important beds have been found. Table IX. — Iron ores extracted (metric tons). Year Upper Silesia Kingdom of Gallcia Poland Totals 1890 1900 1905 1910 1912 758,000 407,000 315,000 234,000 165.000 229,000 9,500 484,000 300,000 8,100 173,000 4.200 120,000 16,000 996,500 891,000 623,100 411,200 S01,000 Table IX gives the relative figures of the out- put of iron-ore in Poland. This table shows that during the course of the last twenty-five years, before the war, the output of iron-ore steadly diminished. There were several reasons for this. In Upper Silesia, the decrease in the output was caused by the exhaustion of the seams. In the King- dom of Poland, by the growing competition of the rich metallic ore from southern Russia, while in Kalisz and other districts the exploitation of the mines was hindered by the inadequate system of railroads. In spite of the decrease in the output of the iron-ore mines; in spite of the fact that Polish ore only contains, (on an average 15 to 30%), at most 53 40% of pure metal, the production of pig-iron in Poland developed considerably during the last twenty-five years because Poland possessed the soft coal so important in the manufacture of iron. As there was not enough native ore to supply the demands of the iron and steel manufacturers established in Poland, great quantities were import- ed from Sweden, Hungary and Central Russia. During the last twelve years the metallurgical in- dustry of Poland was based on the importation of rich foreign ore. But, before the war, Germany, Belgium and England also, used great quantities of rich imported ore in their metallurgical industries. Thus the situation of the iron industry in Poland was no worse than in the States of Western Europe having the greatest industrial development. The production of pig-iron in the Polish countries developed greatly, especially in Upper Silesia and in the Kingdom of Poland. But this in- dustry is not yet established in Galicia, principally because of the strong opposition of the powerful Austrian iron trusts. In Silesia of Cieszyn there is only one factory, near the town of Cieszyn, which has an unimportant yearly output. Table X. shows the development of the pro- duction of pig-iron during the last twenty-five years. During this given period the production of pig- iron in the Polish countries increased from 100 to 125%. In the Kingdom of Poland there was a remark- able increase in the number of blast furnaces, and for this given period the increase in iron production was 230%. The increase in Upper Silesia for this period was less — 100 to 110%. 54 The development of the Polish production of pig-iron was subject to a series of harmful, economic and political influences; protection by the Russian government of the importation of iron-ores from southern Russia to the market of the Kingdom of Poland, duties levied on coke imported to the metal- lurgical factories of Russian Poland from Upper Silesia of Cieszym ; government boycott of the products of Polish iron and steel works ; the opposi- Table X. — Production of iron (metric tons). Kingdom Tear Upper of Totals Silesia Poland 1890 507,000 127,000 634,000 1895 532,000 190,000 722,000 1900 744,000 301,000 1,045,000 1901 641,000 324,000 965,000 1902 685.000 283,000 968.000 1903 748,000 306.000 1,054,000 1904 826,000 374,000 1,200,000 1906 861,000 252,000 1.113,000 1906 901,000 303,000 1,204,000 1907 939,000 283,CO0 1,222.000 1908 928,000 210,000 1,138.000 1909 850,000 216,000 1,066,000 1910 901,000 251,000 1,152.000 1911 963,000 347,000 1.310.000 1912 1,048,000 393,000 1,441,000 1913 995,000 419.000 1,414,000 tion of the powerful iron and steel trusts of Austria to the establishment of manufactories in Galicia; the absolute closing of this important market to the products of the steel and iron works of the other parts of Poland; lastly, the small consumption of pig-iron in the Polish home market, which is one of the results of the economic policy of the sharing States that do not take into account the economic 55 needs or interests of the Polish countries. However, notwithstanding all these unfavorable influences, the development in the production of pig-iron in the Polish countries has been serious. Before the war, Poland occupied an average place among the Euro- pean producers of this metal, so necessary to econ- omic life. If a fundamental change in the political and economical conditions of Poland could take place, the metallurgical industry based upon a larger home market would certainly develop greatly. This has had up to the present time a relatively small capa- city (the annual use of iron per head in the Polish countries has been unimportant, only about 20 kilograms). A modification in the general situation would surely accelerate the consumption of iron, while the capacity of the home market would be increased and would contribute to the intense development of the production. Iron, it must be remembered is found in Poland under conditions quite as favorable for development, (especially that, which concerns the elements of the production it- self) as in the most favored countries of Western Europe. Petroleum occupies an important place in the mineral wealth of the Polish countries. It is found only in Galicia, and up to the present time has been the principal mineral utilized there. The Galician oil-wells extend almost the whole length of the northern Sub-Carpathian Zone, from Gorlice (Western Galicia) to the Bukowina boundary. The principal centre of the production of petro- leum in Galicia was in the neighborhood of Bory- elaw (Eastern Galicia) where there is am enormous 56 reserve of oil and where, before the war, the produc- tion was 95% of the whole Galician crude-oil output. Another big centre, though far less important, is at Krosno where the output has recently been about 5% of the total production in Galicia. The production of petroleum in Galicia is com- paratively -a new branch of the mining industry. Its origin goes back to the fifties of the last century. It was then that small quantities of petroleum began to be Qibtained in the neighborhood of Gorlice, (in the west) and around Kolomea (in the east). The industry did not develop to any extent until the rich fields around Boryslaw were discovered and the Canadian system of sinking wells was adopted (1884). Later the system was perfected (called the Galician system) and it became possible to sink wells to the depth of 1,500 and even 2,000 meters. Galicia has become one of the greatest and most important producers of petroleum in the world. Al- though less important than the great American and Russian (Caucasus) productions, still her role is considerable, especially in Europe as Table XI shows. These figures show that the Polish petroleum productioin concentrated in Galicia occupies an hon- orable place in the European market. The import- ance of the Polish oil industry is increased by the close proximity of Galicia (in the very center of Europe we may say) to the great economically developed continental States that consume such quantities of refined petroleum and other hydrocar- bons mixed with petroleum such as benzine, heavy oils, naphtha and the heavy oil by-products. 57 It is difficult to estimate the reserve of the Galician oil-wells but there is no doubt that it is very important, as the petroleum zone is several hundred kilometers in length, and, before the war, new springs were continually discovered. Upon Table XI. — Production of petroleum (metric tons). United Dutch Year States Russia Indies Poland Roumania India 1890 6.003,000 3.631,000 92,000 42,000 15.000 1895 6,929,000 6,509,000 133,000 215,000 76,000 49,000 1900 8,334,000 9,927,000 425.000 326,000 250,000 141,000 1901 9,090,000 11,157,000 652.000 452,000 270,000 187,000 1902 11,629.000 10.551.000 800.000 576,000 310,000 212,000 1903 13,160,000 9.902,000 870.000 727.000 384,000 829.000 1904 16,085.000 10,742,000 1.036.000 827.000 504,000 473,000 1905 18,647,000 7,499.000 1.158,000 801,000 639,000 579,000 1906 17,416,000 8.036.000 1,188,000 760,000 890,000 562,000 1907 22,845,000 8.443,000 1.178,000 1,170,000 1,151,000 608.000 1908 24,575,000 8,582,000 1,143,000 1,718,000 1,150,000 706,000 1909 25,093,000 9.112,000 1,736,000 2,086.000 1,293,000 934,000 1910 28,969.000 9.367,000 1,881,000 1.761,000 1.345,000 859,000 1911 28.977.000 9,147,000 1,670,000 1,462,000 1.545,000 902,000 1912 29.664.000 9.263.000 1.520,000 1,187,000 1,806,000 900.000 the authority of the Polish geologist Szajnocha, professor at the University of Cracow, a very conservative estimate would allow a reserve of 300 million tons of crude-oil. It is also estimated that the Polish petroleum production will not only remain for many years to come at the present high level, but that it will become even greater, reaching a higher place on the world market and increasing its value as a powerful factor, in the independent eco- nomic development of Poland. 58 Another source of mineral wealth in Poland is Salt. The great salt mines of Poland have been celebrated for centuries. Beds of rock salt are found in western Galicia, in the neighborhood of Wieliczka and Bochnia and in the Grand Duchy of Posen near Inowroclaw. In recent years extensive new beds of rock salt have been discovered in the southern part of Upper Silesia near Pszczyna. Besides these rich beds of kitchen salt there are many salt springs in the Polish countries from which the salt is extracted in factories. Before the war, there were nine of these salt factories in Galicia, mostly in the eastern part. At Ciechocinek in the Kingdom of Poland, there was one medium-sized salt factory. In Prussian Poland at Inowroclaw there was a factory and a mine, but of little importance. Potasium salts, so im- portant to agriculture as artificial fertilizers, were also exploited to a small extent, before the war. Table XII gives the relative figures of the prod- uction of rock and factory salt ini Poland during the last twenty-four years. Table XII. — Production of salt (metric tons). Grand Duchy Kingdom Year Galicia of Posen of Poland Totals 1890 128,000 40,000 3,000 171,000 1900 135,000 53,000 3,000 191,000 1905 176,000 30,000 3,500 209,500 1910 156,000 33,000 3,000 192,000 1912 170,000 32,000 4.000 206,000 Thus, during recent years, the production of salt only amoufnted to about 200,000 tons a year. ^ This small output, considering the great amount of salt in Poland, was due to the fact that from Galicia the salt could not be sent into the Kingdom of Pol- and because of the prohibitive tariffs. Thus chemical industry could not develop in the Kingdom of Pol- and because of the lack of salt which is one of the important raw materials, while in Galicia the chemical industry was checked by the same causes that hindered the general industrial development of that province. The great salt wealth of Galicia, Upper Silesia and Posnania (it must be remembered that from the point of view of their mineral wealth the Polish countries have not yet been sufficiently studied) can become one of the foundations for a 'brilliant devel- opment of the chemical industry and must be con- sidered as one of the important factors of the inde- pendent economic existence of Poland. There are also somewhat important beds of raw-material minerals of secondary order that have great value, either for the pottery industry (differ- ent clays, refractory and common) ; for the chemical industry (phosphorite, sulphur and mineral wax) or for building stone, without speaking of the great wealth of turf and lignite that also have an economic value. Besides the great mineral wealth, the Polish countries have other natural wealth of immense importance for industrial development; the im- mense forests that already before the war served as a basis for the wood industry and provided for its future ; great tracts of land adapted to the cultiv- ation of beets favored the development of the Pol- ish sugar industry, which as has been remarked. 60 occupied one of the principal places in Europe before the war ; also great tracts of land suitable for the cultivation of flax and hemp constituted an im- portant factor in the future development of the tex- tile industry, based on these raw materials. To sum up, the great natural wealth with which the Polish countries have been so generously endowed, both in quantity and quality, constitute one of the decisive factors of the economic independ- ence of Poland. The economic territory of Poland equals, in this regard, the countries of Europe that, before the war, were considered economically independent and that really were independent, with- in the limits assigned by the world standard of economic life in the states and countries of Europe. 61 THE POLISH COUNTRIES AS A RESERVOIR OF LABOR. The Polish countries, before the war, were a huge reservoir of human energy. The reserve and constant growth of this energy considerably ex- ceeded the demand for labor. The result was that each year great numbers of Poles emigrated from their native land. Some of them going for short per- iods into western Europe, especially Germany, for- med the great Polish seasonal emigration. Others going for a longer time, often forever when they crossed the seas. During the last twelve years the Polish emigration to America reached the ener- mous figure of almost four million. These Poles are employed chiefly in industry in North America and in agriculture in South America. This one fact, that Polaind occupies one of the first places among the countries of great peasant and labor emigration, proves that the economic development of the country is insufficient. Economic industry could not prosper, notwithstanding the great natural wealth and the favorable geographical situation of the country in the center of Europe, because of the unfavorable conditions caused by the economic and political policies of the sharing States. It also proves indisputably that the Polish count- ries have a great reserve of human force, wtiich un- der favorable conditions — to be explicit — in a Poland politically and economically independent, 62 could be utilized at home, and would contribute to the growth of industry, commerce and agriculture, in a word, to the entire producing organism of the country. The Polish countries are among the most dense- ly populated countries of Europe. In certain districts of Poland, the population is perhaps as dense as anywhere in Europe. Figures derived from the Austrian and Ger- man census for 1910 and from calculations made to reduce to the same date the older Russian data, of the population of ethnographical Poland and of the territories belonging economically to it, are given in Table XIIP). Table XIII. — Area and population. Area Inhabitants Provinces sq. kilom. Population p. sq. kilom. Russian Poland: Kingdom of Poland 123,326 12,476,000 101 Lithuania & White Russia 304,356 12,709,000 42 Ukraina 165,000 12,337,000 75 Austrian Poland: Galicia 78,497 8,026,000 102 Silesia of Cieszyn 2,222 435,000 196 Prussian Poland: Upper Silesia 13,230 2,208,000 167 •Grand Duchy of Posen... 28,989 2,100,000 72 West Prussia 25,553 1,703,000 67 East Prussia 38,724 2,064,000 53 1) Of the provinces included in table Xin, that were parts of the ancient Polish Republic, the parts that are ethnographic- ally Polish, are made up of the Kingdom of Poland. Western Galicia and the greater part of Central Galicia, Silesia of Cie- szyn and by almost all of Prussian Poland, except the narrow districts near to Pomerania, Prussian Silesia and the north- eastern part of East Prussia. But that which is decisive here is the fact that with the exception of a part of Whlta Russia and Ruthenia, all the terri- tory included in this table is economically Polish. The bound- aries though ethnographically weak, are solidly joined to the central mass and form with It economic Poland. According to this table the economic territory of Poland includes, grosso-modo, besides all of Prussian Poland, Austrian Poland, and the King- dom of Poland, the provinces of Wilno, Kowno, Volhynia and almost all of Podolia, that is to say, a territory covering an area of 545,00 square kilo- meters, peopled by 42 million- inhabitants — being 77 people to a square kilometer. So, by the extent of territory within her econ- omic boundaries, Poland is larger than the German Empire before the war, larger than France and only exceeded by European Russia and Austria- Hungary. The population was exceeded only by that of Russia, the German Empire, Austria-Hun- gary and England. For density of population she follows after Belgium, England, Italy and Germany. The place of the Polish countrieij, taken within their economic boundaries, among the principal European States for area, number and density of population is shown in table XIV. Table XIV. Area and population. Area Inhabitants Countries sq. kilom. Population p. sq. kilom. European Russia 4,816,000 93,400,000 20 Germany 540,000 65,000,000 120 Austria-Hungary 676,000 51,000,000 78 Great Britain .. 314,000 45,000,000 144 Poland 545,000 42,000,000 77 France 536,000 40,000,000 73 Italy 287,000 35,000,000 121 Belgium 29,455 3,700,000 252 The density of the population in the Polish countries (77 inhabitants per square kilometer) is high, because a great part of Poland is agricultural. 64 having great landed estates which, as is well known, always have an unfavorable influence on the pro- gress of the density of population. This relatively high density of population is due chiefly to the extraordinary density of the population in the industrially developed parts of Poland. Thus, the average population of the King- dom of Poland, during recent years, was more than 101 inhabitants per square kilometer. In Piotr- kow, the most industrial government, there were 171, in the governnuent of Warsaw 151, in Kalisz 113, in Kielce 103, in Silesia of Cieszyn 196 and in Upper Silesia 167 inhabitants per square kilometer. Thus the density of population in the industrial dis- tricts of Poland compares favorably with the most developed industrial countries of Europe. The great strength of Poland, as a reservoir of human force, is shown by the fact that up to the present, she has had the highest natural increase in population (higher birth than death rate). Accord- ing to Dr. Josef Busek, Professor at the University of Lwow, the annual excess of births per 10,000 in- habitants during the period 1900 — 1911, in the government of Volhynia was 199, in the Grand Duchy of Posen and in Upper Silesia 197, in West Prussia 181, in Silesia of Cieszyn 149, in the govern- ment of Podolia 180, in the Kingdom of Poland 147, in Galicia 146, in East Prussia 123. In the govern- ment of Kowno the figure is 73. This is the only district where the figure falls below 100 — the lowest figure for Europe. Poland thus leads in the increase in population. T'he average figure of the natural increase in population in Europe, during the last ten years, is 65 at)out 150 per 10,000 inhabitants. Researches made on the influence of social, economic, cultural and confessional factors that determine this great in- crease in population, make it possible to state with- out exaggeration that during the next ten years Poland will have a greater increase than any other country in Europe, excepting, perhaps, Russia. Thus, the Polish countries, within their econ- omic boundaries, constitute a powerful reservoir of human energy that differs from the other labor reservoirs of Europe by its much more rapid and important growth. The continued growth of the population and the yearly increase of available labor, has, unfortunately not been accompanied by a like expansion of produc- ing enterprises. The development of industry cf agricultural products, progressed much less rapidly and as a result the work market was always over- stocked. Offers considerably exceeding the demand forced the continual emigration of the workingmen. The result was that the Polish economic emigra- tion into the countries of the old and new world grew more and more extensively. The economic emigration of the Polish count- ries took two forms: the continental seasonal emigration which was composed almost entirely of farm laborers ; and the permanent overseas emigra- tion composed of mechanics and industial working- men together with great numbers of men without special training who took with them to North or South America only their health and their strength. The Polish emigration, both seasonal and perman- ent, increased greatly during recent years. 66 The seasonal emigration included a great num- ber of workingmen who went into western Europe — Germany especially — for a certain period, usually the farming season. During the la;st ten years this emigration has grown steadily greater until in the years just before the war, there were ever increas- ing numbers of Polish workingmen to be found in Belgium, France, Sweden, Denmark, Norway and Switzerland. However, the principal seasonal emigration was always toward Germany, where each spring crowds of workingmen and girls went in search of work. It is impossible to have an accurate figure con- cerning this emigration but according to the figures .of the central Prussian office of farm laborers^) the following table gives the number of workingmen having passed the frontier bureaus. Years Kingdom of Poland Galicia Total 1907-8 210,045 139,953 349,998 1908-9 212,239 149,676 361,915 1909-10 239.879 165,403 405.282 1910-11 253,143 160,285 413.428 1911-12 281,813 153,762 435.575 1912-13 285,829 166.474 452.303 1) The German -Central office for farm laborers (Deutsche Feldarbeiterzentralstelle) with the central office at Berlin, was founded about eleven years ago by a group of German Political Associations in agreement with certain German agricultural circles, for the purpose of economically fighting the Poles. Lrfiter this Association became an Official Institution of the Prussian government and most of the other Federated States. It was given control of the seasonal laborers at the frontiers and authorized to deliver certificates to them, which gave then* the right to look for work on German tprritory. It is impossible here to give all the activities, so harmful to the Polish emigra- tion, of this Central Office and its branches on the frontiers. It is sufficient to note that the Prussian ministerial ordinances, as well as those (of most of the other German States, gave over this immn energy from Poland and again the development of this industry was the magnet that drew the Polish emigration toward those countries. Thus, before the war, there were several million Polish industrial and agricultural laborers working in the countries of Europe, in North and South America. Poland, possessing together with Russia the greatest increase of population, was unfor- tuna,tely so little developed economically that it could not furnish work for the mass of its people. This is Why, together with Italy, she has become the principal source of emigration. The expansion of national production alone will stop this abnormal phenomenon. The development of industry, of commerce, of ways of communication, the intensive utilizing of the country's great natural wealth, has for a condition the reconstruction of the Polish countries into a State organism : the estab- lishment of a State, united and independent. This is the condition, sine qua non, of the development of the economic organism of Poland, of the enlarging of her national workshops, giving work to millions of her population who have until now been forced to search the world over for work and bread. VI. THE RESERVES OF CAPITAL IN THE POLISH COUNTRIES. Together with natural wealth and reserve of man-power, capital constitutes one of the funda- mental factors of modern production. While dis- cussing the conditions and elements of the economic independence of the Polish countries, the question of the reserve of capital to be found in Poland must not be neglected. The question of whether the in- dispensable capital needed for the extension of its economic organism is to be found in Poland must not be passed over in silence ; of whether the work of past generations is condensed into a capital sufficient to utilize all of the natural wealth of the country. It is an undeniable fact that the political, social and economic conditions under which the whole population of economic Poland, (no matter what nationality they were) has lived, during the whole of the nineteenth century and up to the beginning of the war, has been unfavorable to the accumulation of capital. The Polish countries, since the time of the partitions, have been systematically ruined, either by wars or by the policies of the sharing govern- ments, in regard to them. The national wealth, that at the end of the eighteenth and the first half of the nineteenth century, was represented alone by the tillable land and by great landed estates, was ruined K 70 by the Kings of Prussia, by the Emperors of Austria and Russia. Frederick the Great, Frederic-William III, Joseph and Ferdinand of Austria, Catherine II, Paul, but more that all the others, Nicholas I ruined, although by different methods, the Polish in- heritance. Each revolutionary movement, each dis- covered conspiracy brought new confiscations of immense wealth, most of it lost to Poland forever. Although the destruction of Polish property by violence has ceased during the last fifty or sixty years, still the sharing Governments have hindered fhe growth of capital in the Polish countries by their peculiar economic policies. The principal object of their policies has been to accelerate the accumul- ation of capital in the thoroughly German or thor- oughly Russian parts, of Germany, of Austria or of Russia: Polish interests were either neglected or voluntarily sacrificed. It is clear that under such particularly unfavor- able conditions the growth of capital progressed slowly, that it remained far below what it would have been, if the collective life of Poland had developed normally, in the western and European sense of the word. Thus we see that the situation of Poland, regarding capital, was far less favorable than that of the western countries of Europe which had possessed, during long years, a well developed economic life, having all the advantages of the pro- tection of their States, of their own governmental organizations. Still one must not imagine that the Polish countries are entirely without that capital which is the result of the work of past generations. For even though it is impossible to calculate the exact amount 71 of the reserve of capital, -still some idea can be given of tlie development and state of Polish savings be- fore the war, enough at least to partially judge the progress of its accumulation. The largest and economically the most import- ant result of the accumulation of savings in Poland is the evolution of the co-operative credit. The first distinctly co-operative societies were founded fifty or sixty years ago. It is only since 1900 however, that they have contributed in such a decisive way to the growth of savings, that their development has become important. That is to say, since they have included the population of 'the country as well as that of the cities^). During the period between lOOO and the begin- ning of the war, the system of co-operative credit and savings societies in the Polish countries was greatly extended and an important capital added to their treasuries. The figures in table XVII give a summary of 1) Before the war, the organization of savings in the Polish countries had no uniform character because in each part of Poland there were entirely different political, economic and judicial conditions. Thus in the Kingdom Poland, in Lithuania and in Ukraina there are besides the States savings bank, societies of mutual credit and of small credit societies and in the large industrial towns of the Kingdom of Poland manufac- turers industrial credit associations. In Austrian Poland, In Galicia and in Silesia of Cieszyn, there are, besides the savings banks, a system of credit societies (system Schultze-Delitsch) and rural savings and credit societies, banks of the Raeffeisen system, patronized by the autonomous authorities. The system of co-operative credit societies, based exclusively on the Schul- tze-Delitsch system shows the greatest uniformity in Prussian Poland. Lack of space prevents my retracing the home develop- ment of the credit co-operatives in Poland. The most ample details of the Polish situation are found in a pamphlet published in French, in 1914, at the time of the International Agricultural Exposition at Lyon: "Les Socletes co-operatives polonaises de Credit, leur developpement et leur etat actual dans los trols parties de la Poloqne. Leopol, 1914". 72 ^3 u o -a a, > X o c ft ce o ■* «o o o» eo 1-1 ■^ 1^- (M <3J OS iH o" i>r OS t- lO O eg (M o> la t- o T»r o* iO CO M lO (M cc t- t- 00 CQ t- 00 «D CO t, «S_ U3 o_ ec «r «c •>*•" OS IM «> 00 T-4^ to »H os_ eg lo e«s" o eg ec CO eo 00 o» O il o ^ to «c t- ,-r ^* o a . ^ i;| o : cd o f^ o H "S i^^ S ' 5 2 ^^ ■O 7? oj bo .H « •s-s g {400. J CO OS o o ^ t-_^ <» eg 00 eg «o i-H eg lO *1 CO **. 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