A THREATENED TARIFF WAR.

Press, Volume LXVI, Issue 13683, 17 March 1910, Page 6

A THREATENED TARIFF WAR.

The tariff dispute between the United States snd Canada threatens to develop into a bloodless war. The Payne Tariff Act of last year enacts that after the 31st of thia month there shall bo levied on all articles imported into the United States, certain duties as per schedule, and in addition there.to a surtax of 25 per cent. These rates shall constitute the general or maximum tariff of the United States. But if the President is satisfied that a foreign country does riot m its tariff "unduly discriminate" against American goods, he may apply to the goods of that .country tho minimum tariff—the schedule duties without the surtax. The difficulty of Canada's ,p_sition can easily be understood. ' The Dominion has for years given Great Britain preference, and by a recent commercial convention she gave France preference in respect to about a hundred articles. Canada, therefore, is clearly in the position of discriminating against the United States. There is some reason to believe that the preference to Great Britain -is ■ not a cause for complaint, for a recent mossage mentions only the arrangement with France as an obstacle to the application of the minimum tariff. Everything apparently depends on the construction placed en the word '•unduly." ■Mr Taft can hardly expect Canada to forego her preferential arrangements; no doubt what he wants is some modification of them. It is said that if the maximum tariff is imposed, Canada will retaliate with a surtax on American goods of 83i per cent., and prohibit ..the exports of wood for the manufacture of paper.

' A ' tariff war between the two countries would hurt both of them, but the United States would probably suffer more than her neighbour. In 1903 the Unite- States sent 'into Canada goods valued at over S.IL,Z~J,OOO, while Canada's exports intc the United States amounted to but £23,000,000, But a tariff war might hit Canada fairly hard. So far as most of her exports to the United States are concerned, the schedule duties under the" new American tariff are not materially increased, but :t the maximum ■tariff is applied an increase of 25 per cent, will have to be faced. The duty on lumber his been cut down from two dollars to a dollar and a quarter, but under the maximum tariff a good deal of the benefit of the reduction would be lost Seeing that the lumber exported last year was rallied at over £3,000,000, the "minimum tariff would "be very welcome to the industry. The ooal duty has been reduced by 18 cents. a ton, and that on iron»i>rc by 25 cents. The coal trade was worth nearly a million sterling in 1908, and tho reduction in iron ore is welcomed because it may lead to the development of minora! areas by American capitalists. It is, therefore, much to Canada's interests to secure the benefits of the minimum tariff if she can. In the past Canadian trade with tho United States in somo lines has been practically "killed by tariff changes. For instance, prior to the McKinley tariff Canada exported to her neighbour fifteen million dozen eggp. In 1908, thanks to the duty of 5 cents a dozen, the number was little more than two thousand dozen. But, whatever may happen to tho French agreement as the result of these negotiations, we may take it as certain that preference to Great Britain will not be abandoned—at least not just yet. Tho danger to the Empire of a tariff

war between the two countries is the growth of a feeling in Canada that it would pay better to negotiate with tlie United States than with England.