The commercial crisis and the high taxes have created great discontent among merchants. Coffee-planters and rubber-gatherers have still further suffered by the rise of the currency. Immigration has practically ceased, and there is little water left in speculative enterprises. The great Bank of the Republic failed in 1900, dragging down many industrial concerns and ruining thousands of small investors, and the government's connection with the bank caused much scandal. Other banks, which had too much extended their agricultural and industrial credits, have also failed, and there is great want of confidence among investors. However, capital is slowly accumulating, and a healthful tendency toward industrious habits and the employment of reasonable and moderate methods in exploiting the great untouched natural resources of the country is evident. Rodrigues Alves, the third civil president of the Republic, was peaceably elected in the spring of 1902, and took his seat on November 15th, the thirteenth anniversary of the Republic. Like both his predecessors he is from Sao Paulo, and was virtually named by his immediate predecessor. His policy is expected to be the same as Campos Salles's--that is, to keep expenses within revenue and to maintain the political _status quo_. Leaving out immigration, the Brazilian people have shown a steady natural increase of nearly two per cent. per annum during this century. The total population has multiplied from less than three to more than eighteen millions. Not a fiftieth part of the territory is cultivated; its resources have never been studied, much less developed; the positive checks hardly exist; the preventive checks are yet indefinitely remote. Modern altruism makes wars of extermination unthinkable; the colonial experiences of the last century have demonstrated that races possessing a reasonably efficient industrial organisation do not tend to disappear, even though nations whose physical force is greater may reduce them to political subordination. The Brazilians have the additional advantage of inheriting directly a European civilisation. They are too firmly established, too numerous and prolific, and possess a too highly organised and deeply rooted civilisation to be in danger of expulsion or political absorption. Immense immigration into South America is inevitable, as soon as the pressure of population is strongly felt in Western Europe and North America. This may transform Brazil economically, but the new conditions will have to fit themselves into the political and social framework already in existence. [Illustration: MAP OF SOUTH AMERICA _SHOWING THE PROGRESS OF SETTLEMENT AND PRESENT POPULATED AREA_] [Illustration] INDEX A Absolutism, of King of Castile in America, 53; of Francia, 192; of Lopez, 199, 201; of John II., 293; of Pombal, 397; of Pedro I., 421, 424; revolt against, 411, 412 "Adelantados," 23, 34, 166 Affonso Celso, 492