STEMMING THE TIDE

Evening Post, Volume CXXIV, Issue 107, 2 November 1937, Page 15

STEMMING THE TIDE

THE MIRAGE OF RESTRICTION

Price-cuuiiig in Porangahau has reactions in Paris. moments reflection is enough to show thai this statement is not such a gross exaggeia'Jon as, may at first appear. So long as Western ideas of civilisation persist a disturbance on one side of the world may have reverberations on the other side. A drought in America may mean a good wheat year in Australia. A coal strike iri England may bring relief to Poland. A change in public taste can spell ruin for a Lancashire industry and wealth for an industry in Japan. A single national policy may cause a general modification in the international structure of the world, :

Similarly an Act ■ of Parliament in New ■• Z «nland may. have results infinitely more far-reaching than were-ever contemplated when it-was placed on the Statute Book. Legislative action in one or more countries can, and sometimes does, have the effect of producing profound changes in the world st large. The'repeal of the Corn Laws in England brought about changes that w«re world wide.

During the eighteenth, nineteenth, and early years of the twentieth centuries countries such as America, Australia; Canada, and New Zealand were absorbing annually large numbers of European emigrants. But with the dislocation of some part of the, international commercial; system there came an almost complete suppression of immigration in all those countries which hftd previously, been ;receiving the bulk of European emigrants. ' ■ 'Our present inadequate knowledge of the science.'Of population affords some■.■■■ Justification 'for; the action then taken. Trie righ^tff any. nation to refuse, to become1 the';.dumping ground for the unemployed bt:*rioth9if.:fis'.'un' questi6.niab'le;.'.--'-".G?neral appreciation of this inaliehablitight. allowed the world to acquiesce'v lh-th^-'restrictive measures adopted in ■thbse:'countries \vhich had become the, principal immigrant nations. ■~-'"■ '■'. ''"; vv.. '■^.•- * Enough time has" now. elapsed since those restrictions .were first' imposed for their';effects to be examined inthe light of actual experience. We qan now judge of their wisdom; The reason generally stated as justification for their enactment'is the"'fear' of becoming; the receptacle for another country's unemployed. 'They were imposed then ostensibly1 'to protect. what are commonly assumed to be, and still more commonly ; mistaken for, national interests. The measure of their wisdom will therefore, be the extent to which they have benefited, the international structure of the world. If the effect of those restrictions has been detrimental to the world at large, then they, have failed of their original purpose, and,, instead of protecting national interests, they have endangered them.. ADVANTAGES BOTH WAYB. The principal advantage of migration to the emigrant country is that by increasing 'the population, and consequently the output of materials of some under-populated nation the market for the products of the emigrant state is enlarged.' The advantage to the immigrant country is that" the additional population help? to improve the standard of living by spreading the cost of capital equipment and social services, increasing the total, production arid ■■strengthening the consumer value of the national market. From the world point of.View the better distribution of population tends to more even employment and a greater volume, of international commerce. The world advantage is equally, the national advantage since the only reason for international trade is that it permits of a more . intensive division of labour over a. greater areai and consequently leads to better efficiency in all forms of economic activity, thereby improving the standard of life in the world as a whole. .. . ' In the economic sense the period of greatest'international stability was the quarter century ending with the year 1913. puring that period something like 2.250,000 Europeans were emigrat-ing-annually. This period, was also the greatest for overseas investment of capital. Men and capital were being converted into markets at a rate, greater, than ever- before. With the outbreak of war migration was temporarily suspended. - At • the same time production was forced in order to meet the insatiable demands of, the belligerent nations. New industries were started in many countries to-.make available goods arid material which had been diverted for war/purposes.1 The important thing to remember, however, is that the war did: not start this movement of. industrial devolution; it merely hastened it. .- .- : In the subsequent economic dislocation: an entirely different viewpoint was adopted : towards .migration. A viewpoint in which: an appreciation of the real value of the free .movement of people was lost in the .confusion of a general - economic- derangement. What had been a temporary suspension now became a deliberate stoppage. America, by a series of enactments, reduced the number ; of immigrants admitted annually from over a .million to under 150,000. Canada and Australia reduced the stream of immigrants to a mere trickle, and New Zealand by 1931 had actually become an emigrant country. EFFECT ON BRITAIN. England can be taken as a typical example of an emigrant Power. She has for centuries sent men and money to all parts of the world, and by so doing has increased the market for her products. In turn she has becomte the greatest single trading unit in the world. Since the almost universal stoppage of migration she has been receiving back more pebpls than she has been sending out. The • effect of the various restrictions has been serious to her economy, and consequently to world economy. One of the results Of these restrictions is that in British factories alone in 1928 there were 165,000 more people employed than there were in all the factories of Great Britain and Ireland in 1914. At the same time unemployment has increased considerably. It is important to remember that this addition to factory employment has been achieved at a time when increasing mechanisation is tending to reduce the number of operatives required in industrial production. Since the volume of international trade is still well below the 1929 level the production of British factories cannot be entirely, nor even largely, for the export trade., This is again borne out by the fact that of the 551 new factories established in 1936 and employing 53,000 people only 121 are interested in the export trade; 430 look to the home market as their normal ■outlet. Thus the policy of protection elsewhere, together with the restrictions placed on migration, has resulted inevitably in, a growth of industries supplying goods previously imported. A definite industrial change has been taking place in .the economic.structure of the greatest trading nation in the world. . Production is being diverted from the exporting, to the domestic industries. This is by no means the same thing as an expansion of the domestic market. Linked with the decline in the ex-

NEW BLOOD IN NEW COUNTRIES

I port trade is the resuscitation of British agriculture. .• Obviously, if Britain cannot maintain the. previous volume i of exports she, cannot continue to're-J the same volume of imports.!. Fo-idstiiffs had been a major item of I the import trade; by reviving the longneglected agricultural. industries Eng-1 land will.be able to economise on her] overseas expenses and bring them more into line with her diminished export' credits. LOWEIUNG THE STANDARD. I What has happened in England has happened in other emigrant countries. Germany, for instance, is haying to adopt a number of import restrictions and concentrate upon the development of synthetic production \yith the result that the standard of living in Germany today, in spite of Nazi propaganda, is distinctly lower than it was before the war. Practically through-' out Europe '-the effects are the same, and are culminating in a gradual deterioration of the standard of life resulting in the slow impoverishment of the continent.. It is not claimed that migration restrictions are solely responsible for the present unhappy stati? of Europe, but it should be borne in mind that the emigrant countries of yesterday were also the principal importing nations of the world. Behind all this there is the significant fact that the restrictions imposed on migration by .the, former immigrant States have produced the effect of overcrowding in the ex-emigrant nations which in turn is tending to obscure the true state of affairs, 'namely that the population is in reality declining at a serious rate. Because the normal outlets of population have been stopped there is a greater concentration of people-in certain countries than would have been the case If immigration were still allowed. In»a series of interesting experiments with mice Professor F. A. E. Crew has confirmed previous experiments by other investigators that the death-rate, reproductive rate, and fecundity of a population are' affected by population density. Thus while it is not suggested that, immigration restriction is wholly responsible for the tendency of European population, it- is suggested that those restrictions may have the effect of hastening the rate of decline. • America is a "typical example of an immigrant nation: What has happened there? It is slowly becoming apparent to thinking Americans that the whole structure of American industry has been founded on the expectation of a much larger population and that any slowing up of,the rate of population increase will tend to make industries less profitable and unless greater exports are possible the economic fabric of the United States may be facing a serious collapse. America, as the greatest creditor nation, cannot exipect to export if she does not permit imports and is also prepared to enter the internationalloan market in a big way. America, in short; is on the horns of a dilemma and is facing the unpleasant likelihood of having to, accept a lower standard of living because her industrial equipment has been planned! to meet the requirements of a popula- i tion which apart from natural increase, was expected to become greater by a half to a million immigrants yearly. ' In Canada and Australia it is the same story. A generous expenditure on railways, roads, and industry in the, past in the confident belief that there would be a'much; greater population than is the cage at present is weighing' down the economic life of those two Dominions. Unless these countries find larger export opportunities for { their industries they cannot retain their present economic standards. Their populations are increasing at a slower •rate than was anticipated. Manufac-, turing in both those -Dominions Is re- ( latively costly because the deadweight of capital expenditure is being carried' by a smaller population than it was de-1 signed to serve. This relatively high, cbst of production is a severe handicap, when those industries are competing with European and Asiatic production. The ultimate success of Canadian and! Australian industry will depend large-! ly, if not wholly, on the- growth of the | home market, which in turn means the growth of population. - ", THE CASE OF NEW ZEALAND. New Zealand is a long way behind her sister Dominions in industrial development, and with the smallest popu-1 lation of all is finding tremendous dif-l ficulties in-the way of further develop-1 ment. Australia is today.using the. New Zealand market to supplement; the deficiencies of her home market.] If, as may well happen, New Zealand | raises her tariffs against Australia thej effect will be most serious, to Australian industry, and of doubtful benefit to New Zealand.' Canada and Austr?-I lia are finding costs of production a| severe handicap with populations of, ten and eight millions respectively and | have to make up the deficiency of the, home market by export New Zealand | with but a million and a half faces a I similar problem, but magnified. to the power or ten. The devolution of industry and urbanisation of population are related. phenomena. They are movements that j will continue in the future. The wider | international balance of the pre-war | period is a passed phase. The new world structure is one in which national economy will show a ; much closer balance 'than heretofor. The volume of world trade will doubtless, increase, but it is unlikely that it will ever reach its' previous record. Until birth control or natural decrease reduce population in the former emigrant States they will carry a high percentage of unemployed which will lead to a greater protection of their own industries, and increasing attention being paid to their domestic markets. | The legislative restrictions, placed, upon migration were, imposed for the purpose of protecting national interests. If they are retained very mucn longer their effects will, be considerably more harmful to the nations which have imposed them than to those against whom they are aimed. They have been created as emergency measures that savour not a little of hysteria. Sufficient thought was not given to their possible reaction on world trends with the result that .the. immigrant nations have, been caught shoit at a most critical time in their development. Because of these restrictions immigrant 'States have placed themselves in the awkward position of having an industrial structure which they must maintain- and which is greater than can be sustained by their own- internal markets. Their natural rate of increase is not rapid enough to.correct the deficiency, and with decreasing world trade and intensified competition the likelihood of relief *°und^" export is extremely doubtful. The ultimate effect of these measures has been to contribute to world impoverishment, to place an additional strain on international relations, and put the immigrant countries.in a distinctly inferior position in the struggle.to improve the standard of life. If they are to survive in the new* world structure, the immigrant countries will, have to augment their populations by means of immigration., Restriction is not protecting national interest; it is undermining it- ■ : ■