IMPERIAL FEDERATION.

Auckland Star, Volume XXXIII, Issue 112, 13 May 1902, Page 2

IMPERIAL FEDERATION.

THE SILEEX THKEAD AND THK

COMMERCIAL CABLE,

(From Our London Correspondent)

LONDON, April 4

The growth of the Zollverein idea in public favour is shown by the fact that men of eminence are beginning to formulate schemes of a practical nature for an Imperial tariff. Sir Vincent Caillard, who has had exceptional opportunities for investigating the subject, contributes to the April "National Review" some suggestions towards the tariff. Not content with stating his own ideas, he has taken the unusual course of getting his statistical tables and figures audited by a well-known, accountant. The results are very valuable and highly interesting. The article is founded on the now generally admitted fact that the normal expenditure of the Mother Country in future years cannot be put at a* less sum than one hundred and fifty million pounds, including the cost of maintaining a garrison in South Africa. , Sir Egbert Giffen puts the amount at about six millions more. On the other hand, our revenue on the present.basis.may be put at one hundred and fortythree million pounds. Consequently on the existing taxation there m usl be a deficit of between seven and thirteen millions to meet in the future. How to meet it is the question. There is a very general feeling that the income tax, with its many objectionable features, ought not to be increased, and the fact that the excise returns show a diminution of a million and a half on last year, indicates that the limit has been reached in that direction, while the recent increase in Customs has been entirely derived from the new duties on sugar and coal. Turning, then, ro the proposals for reforming our system of indirect taxation, on a broader basis, Sir Vincent Caillard gives a careful analysis of the. position. Taking as his basis that a Customs Union for the Empire should be formed, and that the new scheme must favour trade with the colonies, certain limitations are at the same, time imposed. The new import duties must be levied on articles of general consumption, and preferably, to begin with, on food and raw materials. They should not be so high as to compel a compensating excise nor to increase the cost of living. But, subject to this, Sir Vincent Gaillard shows that we can perfectly well produce all that is required within the Empire itself. The ideai j position might thus be attained, Great Britain being the manufacturing centre, and the colonies supplying her with1 food and raw materials, while foreign imports, under the regulation of import duties, supply "the gentle .stimulus of competition." As to food, Sir Vincent proves that Australasia and Canada—to say nothing of India and South Africa— could perfectly supply all our requirements. Schedules are supplied of suggested duties on all foreign food, raw materials, and manufactures, but these are designed simply as illustrations to be submitted to the criticism of experts. These fig- i ures are most carefully drawn xiv from the British point of view. Sir Vincent Caillard does not attempt, to indicate the line of1 colonial action, but recent events have shown thai the colonies will be very ready to give effect to any practical exposition of the Zollverein idea. The article is a very welcome contribution to the literature of Imperial Federa tion, and is well worth study by all who are interested in the closer knitting-tog-ether of the Empire. Sentiment is, we know, a powerful factor in the cohesion of communities, but Imperial Federation^to be anything more than a name, must have a commercial basis. The silken thread of kinship is strong enough for our present needs, but the clay will come when the "backing" of the cable of commerce will be required to assist in bearing the strain of Empire. SIR ROBERT GIFFEN AS DOUBTING THOMAS. Sir Robert Gift'en does not see eye to eye with those who believe in the practicability of an Imperial Zollerein. He argues that a Zollervein presupposes the geographical contiguity of the countries forming it, so that by making one ring fence round the aggregate Customs barriers between one country and another may be abolished. The British Empire, he therefore argues, cannot become a Zollverein because its. constituent parts are widely separated, communicating only by ships which must always be supervised at the different ports by the Customs authorities. Even with a common tariff, if that were possible, f?ays Sir Robert, the Customs barriers and the" delays and obstructions incident thereto would remain between the different, parts of the Empire, and, he continues, "There would be great difficulties in a common tariff, since the different countries of the Empire consume different things and want to tax different things; and the things one country wants to tax are very often mainly the products of another. Our selfgoverning colonies impose, duties for revenue purposes on the manufactures imported mainly from the Mother Country. India taxes at least one article— salt —which is untaxed in the United Iving-cloru, if not throughout the rest of the Empire. The Mother Country in turn taxes wine, tea, and sugar, which some of the colonies produce, as well as other articles which they would probably send to us if we allowed them to pass our Customs bari"ier freely. A Zollverein between uncontiguous countries with such differing interests as regards revenue would thus appear a material impossibilitj'."

Whether there can be a commercial union on some sort of reciprocity basis is, Sir llobert says, a different question, but he doubts whether any scheme can be proposed which will bear even a brief discussion. He concludes: "When it comes to any smch scheme the question will at once be raised whether our self -gcntem Ing colonies would not act wisely ior themselves in adopting- free trade nxid so promoting- their own advantage »ti well as our own.Hthoiit stirring rp any such difficulties as question*; of reciprocity always do."