Mr. Roosevelt immediately took the oath of office, and promised to continue "absolutely unbroken" the policy of his predecessor. FOOTNOTES: [43] J. B. Moore, _Four Phases of American Development_, p. 195. [44] In 1899, the tripartite arrangement was dissolved and the United States obtained outright possession of Tutuila. [45] The Hawaiian Islands are ruled by a governor appointed by the President and Senate and by a legislature of two houses elected by popular vote. [46] Croly, _Life of Marcus Hanna_, p. 307. CHAPTER IX THE DEVELOPMENT OF CAPITALISM The years immediately following the War with Spain were marked by extraordinary prosperity in business. The country recovered from the collapse of the nineties and entered with full swing into another era of inflation and promotion. The Dingley tariff law, enacted July 24, 1897, had incidentally aided in the process by raising the protection principle to its highest point since the Civil War, but the causes of the upward movement lay deeper. The Spanish War, of course, stimulated trade, for destruction on such a large scale always creates a heavy demand for commodities and capital--a demand which was partially met, as usual, by huge drafts on the future in the form of an increased national debt. But the real cause lay in the nature of the economic processes which had produced the periodical cycles of inflation and collapse during the nineteenth century. Having recovered from a collapse previous to the War, inflation and capitalization on a gigantic scale set in and did not run their course until a debacle in 1907. The formation of trusts and the consolidation of older combinations in this period were commensurate in scale with the gigantic financial power created by capitalist accumulations. The period of the later seventies and eighties, as has been shown, was a period of hot competition followed by pools, combinations, and trusts. The era which followed the Spanish War differed in degree rather than in kind, but it was marked by financial operations on a scale which would have staggered earlier promoters. Perhaps it would be best to say that the older school merely found its real strength at the close of the century, for the new financing was done by the Vanderbilt, Astor, Gould, Morgan, and Rockefeller interests, the basis of which had been laid earlier. There was, in fact, no break in the process, save that which was made by the contraction of the early nineties. But the operations of the new era were truly grand in their conception and execution.