"What about the South American penetration? The records were rather vague or perhaps I had gotten out of my depth."

"Some historians call it rape rather than penetration. Up until 1970 the United States had been steadily losing ground in South America. During the reign of Edward Europe grew steadily more industrialized and found her greatest market in South America. The Asiatic market had been worthless since the 1930's and South America with its raw materials was in a position to reciprocate. On the other hand the United States was an agricultural export nation, and this annoyed several South American states, especially Argentina. But the Forty Years War changed all this. The United States had undergone an economic improvement as a result of the Banking Act which had decreased the spread between production and consumption by lowering the percentage of the cost charges, in a commercial article, unavailable for purchasing power."

"I don't follow you."

"I suggest that you note it down and wait until you study the current economic system. You were probably educated in the conventional economic theories of your period which were magnificent and most ingenious, but—if you will pardon me saying so—all wrong. But to return to our muttons; the improved economic condition produced the usual political reaction and a conservative administration was elected after LaGuardia. There still remained however considerable spread between production and consumption. It had always been the conventional point of view, especially in the economic beliefs of the Conservative Party, that a prosperous nation required a favorable trade balance or gold balance as it was formerly called. In simple language that means that a country is best off when it exports more than it imports. Phrased in that way it sounds silly, for it is surely evident that a country that ships out more than it takes in gets poorer every year in terms of real wealth. Nevertheless there was an element of truth in it, a very practical truth at that time. The economic life was organized in such a comical fashion that each year the country produced goods of greater value than the people of the country were able to buy back and use up. This was known as over-production and many were the esoteric nonsensical things said about it. But the situation was that simple. The system of necessity produced more than it consumed. Of necessity. You can go into the mathematics of it later. Being an engineer you are bound to see the truth of it, and will probably be vastly amused by it."

"Do you mean to say that that was all there was wrong with business in the United States in my day?"

"That was all. And all of your labor troubles, and poverty, and physical suffering were as unnecessary as they were tragic."

"That seems preposterous. If it was as simple as that it could have been fixed. I could work out some scheme to fix it myself, half a dozen schemes. Why in the navy we wouldn't have put up with any such damn nonsense. Why didn't somebody see it?"

"Some people did, C.H. Douglas, Goulds Gainesborough, Bronson Cutting and a few others, but it was almost as difficult to convince people of the fact as it had been to convince an earlier generation that the world was round. In each case the fact was true and the fact was simple but the sturdy common sense of the man who had been brought up to believe in a flat earth or a 'favorable trade balance', rejected the truth. The socialists understood this truth of course, but they insisted that there was only one solution. There were many good solutions for so simple a problem. We believe nowadays that we have a solution more suited to the United States than socialism. But come, we are getting a long way off from South America.

"From 1970 to the turn of the century a partial solution was found. Our excess wealth was poured into our sister continent and it was developed as a new frontier. Gold mined from the Chilean Andes helped for a while to preserve the fiction of a favorable trade balance. After that and in addition to it, almost any sort of wildcat financing was acceptable that would keep up the flow of goods to the south. The private bankers turned to this rich field of exploitation and convinced the public that the new El Dorado lay under the Southern Cross. The whole shaky business piled up until practically the entire continent was mortgaged to the skies in return for goods that we couldn't use ourselves and would have poisoned us if we had kept them. But the Latin temperament had a simple solution. I sometimes wonder whether it was planned or was the inevitable result of the circumstances. But when the due day came each government folded up and a new government calmly repudiated the commitments of its predecessor.

"The first incident of the A.-B.-C. War occurred in 2002 April. The Argentine government had refused to recognize its debts to us both public and private, and several stiff notes had been exchanged. Our South American squadron was ordered to Buenos Aires. Chile and Brazil each informed the United States that any display of force in Argentina would be regarded as an unfriendly act.

"Nevertheless the squadron was not recalled. It steamed into the harbor and had no more than anchored, two old aircraft carriers and an odd dozen of minor craft, when it was attacked from the air and sunk to the last man, before a plane could rise. We don't know yet who did it, but we do know that both the Chilean and Brazilian navies and air fleets had made a rendezvous some two hundred kilometers off Buenos Aires."

"How did the war work out? I found the record account a bit sketchy for my professional taste."

"Why, Perry, you aren't really interested in killing, are you?" Diana was perturbed and incredulous.

He patted her hand. "No Dian', not at all. But the matters of the strategy and the tactics involved and the weapons used are of intellectual interest to me, just as you might be interested in the ceremonial dances that accompanied the Aztecs' Blood sacrifices.

The wrinkles smoothed out from her brow. "Yes, I suppose so. But it does seem barbaric."

"I imagine the weapons would have been largely familiar to you, Perry. The United States had not been at war for many years and it is a matter of history that few weapons are developed in peacetime. The military mind clings tenaciously to its accustomed ways—if you will pardon me. The strategic principle of exterior lines determined the war. Neither side was equipped to deal any telling blow on the other. They were too far apart and there was too much terrain involved. There was no commerce to raid as practically all the shipping had been between the United States and South America. Each side was able to raid the cities of the other, but armies of occupation would have necessitated extended lines of communication to protect at a serious strategic disadvantage. The most startling single incident in the war was the raid on Manhattan."

"Tell me about that."

"One would think that Manhattan would have been evacuated early in the war, but it was extremely inconvenient to do so and the public had been assured that no enemy force could possibly get that far north. As a matter of fact, practically all the fighting had been below the equator. Except for two raids in the Gulf and one on Palm Beach, none of which did much damage, the United States was untouched. But in 2003 December two aircraft carriers, the Santa Maria and the Reina Borealis raided Manhattan. They had proceeded to New York by a route that took them far east in the Atlantic and by luck and partly by foresight they reached the North Atlantic without discovery. They were aided by the weather for the last thousand kilometers had to be made in a thick fog. They attacked at noon, dropping out of a cloudy sky with a ceiling of less than two hundred meters and in some places lower. The attack must have been worked out with great precision, for each ship seemed to know exactly where to go. The bridges were destroyed first, and the landing platforms. It must have been a terrifying sight to see those great helicopters settling out of the clouds and proceeding leisurely to destroy their objectives while the more agile fighting planes that escorted them buzzed around like hornets. The tubes under the rivers were bombed also. A helicopter would settle at the last station, its crew would gas the bystanders while a working party commandeered a train and loaded aboard the explosives. Then with controls and time bomb on board the train would make its last run."