Hawke's Bay Herald. SATURDAY, JULY 2, 1887. FREE TRADE IS FAIR TRADE.

Hawke's Bay Herald, Volume XXII, Issue 7785, 2 July 1887, Page 2

Hawke's Bay Herald. SATURDAY, JULY 2, 1887. FREE TRADE IS FAIR TRADE.

IX further considering the question of how Protection robs tlieco.isumer we will devote a little space tn Victoria, that colony I'i'ing usually regarded by New Zealand Protectionists as an example of the blessings which How from adopting tliK Pived. Uefniv tlii^ article is concluded we will exhibit tlio-,p " bles^ings" in their true li-iht. To make onv subsequent remarks more pointed a few observations on the question of imports generally will be of service. The iirot tnith that Protectionists need to ponder over is that no country which is adding to its wealth can shut o;it import*, no matter how high the duties that may be imposed. In making this assertion there is no reference, to sniujjiiling, which is the natural result of high duties, all that is said being stated

in regaril to transactions as lawful as tlmy arc inevitable. The position needs but little illustration. A country that is rtoins; more than barely exist, and that is therefore adding to its wealth, produces each year a Mir|ilu« of commodities. These must be exported, and conseque.ntly Victoria exports. Tho question now arises, what will she take hack in return ? Not gold, for several reasons, the chief of which is that she exports it. Further, if Victoria did desire gold and could get it, it would be worth nothing to her except as representing commodities, and in that form its exchange value would be lowered as soon as it reached hershores, owing to her ditties making commodities artificially dear. Rut this will-o-tlie-wisp of exchanging for gold is out of the question, and we have only referred to it at all because Protectionists as a body have such hazy ideas about money, its value and its functions. What Victoria renlly receives in exchange for her exports, which are chiefly raw material, are manufactured articles nf various kinds. She must take them, do wkat she will in tho way of imposing duties to keep them out, or else cease exporting. As no Protectionist is foolish enough to suppose that exporting should cease he must admit the correctness of the contention, and a consideration of what necessarily follows from the admission, when supplemented by o few facts, will show him that Protection is logically absurd and commercially unprofitable. Victoria's imports have been growing larger each year. In ISBI she imported £4,472,000 worth of manufactured goods in excess of the value of manufactured articles exported, and in 18S4 this excess had grown to £3,953,000. Further, in spite of a duty of 20 per cent., the imports of woollen and cotton manufactures increased 16 per cent, from ISBI to 1885, and the importation of metal goods, in spite of a duty of "25 per cent., increased 43 per cent, in the same period. So much for the proof that imports cannot cease while exports go on, a contention shown a priori to be necessarily true, and the argument being clenched by facts supplied by Victorian statistics. To find the amount of duties paid upon the manufactured goods it is necessary to add 10 per cent, to the actual value, i that being the method adopted both in Victoria and in New Zealand. That will bring up the sum upon which duty will be paid from £5,953,000 to £0,548,300. The duties payable range from 20 per cent, to 25 per cent., and to keep well within the mark we will take the lower ratio, giving the Protectionist a slight advantage in the matter of figures. Now 20 per cent upon the sum stated amounts to £1,309,600, and that sum added to the first cost of the goods increases thenprice after passing through the bonded stores to £7,262,600. But for the duties the exchange value of those imports in regard to Victorian productions would have been snly £5,953,000, the clear loss being £1,309,660. But now the cost of storage and distribution has to be reckoned (merchants' and retailers' profits), which cannot be set down at less than 15 per cent, by the time the goods reach the consumer. To give the Protectionist every possible advantage we will assume that these charges only amonnt to 10 per cent. That impost upon £5,953,000 would only make a total of £({,548,300, but would bring the larger sum up to £7,958,926, the difference (and loss) being £1 ,440,626. The result, startling as it is, does not nearly come up to the truth, as will be seen when it is stated that although we only set down the duties paid at £1,309,660, the actual Customs duties paid in Victoria in ISSS amounted in round numbers to £1,800,000. Wo have thus practically relieved the Protectionist of the necessity for accounting for an additional half million pounds sterling. The Freetrade side of the question is so impregnable, however, that we can afford to ignore such a " trirle " as £500,000 in our favor, as the final result will be quite startling enough. Besides, the half million may go to represent what might fairly have been levied for revenue, supposing that no " protective " swindle were in existence to |rob the working classes. We now introduce another factor that at once doubles the loss. In ISBS there were in Victoria 49,000 persons engaged in " protected '' trades, that number including nearly 20,001 i women and boys and a number of Chinese adults who have practically monopolised the cabinet-making trade. Now 49,000 persons working at trades in England would produce in a year goods worth to sell there over £8,000,000. As we have no desire to press too heavily upon colonial Protectionists we will not saddle them with the loss which would follow from assuming that Victorian " protected " industries produce on a similar scale, but to be well within the mark we will suppose that they produce goods equal in value, in an open market, to the £5,953,000 worth of goods imported. But the imported goods determine market prices, and as we have seen that £5,053,000 arc made by duties to sell for £7,988,926, the locally-made goods will cost the consumer an equal sum, and the figures last given must be doubled. Now the whole of the goods consumed might have been imported foi£ll,90(i,000, | and, after adding 10 per cent, for distributors' profits, could have been exchanged j to Victorian producers for £13,096,600 worth of their commodities, instead of which Protection makes those people give £15,977,842 worth, a clear loss to the colony in one year of £2,881,232. This loss represents the " beneficial " result of Protection in Victoria during 18S.J, and shows how the general consumer is taxed for the benefit of a small minoiity, the "protected" workpeople being only 1 in 23 of the population. Thus, in order that one " protected " person may work at a naturally unprofitable occupation, and that rings and limited liability companies may make large prolits and pay big dividends, 22 persons who are not "protected" are made to pay over 20 per cent, more for manufactured goods than they are worth. The result is that the Victorian consumer is forced to pay a subsidy towards the wages of the "protected" employes amounting to an average of nearly £1 10s per week per head for each person employed. If that colony were to agree to pay those " protected" persons 10s a week each for life, on conditionthat the duties were abolished, there would be a profit made on the transaction of nearly £2,000,000 a year, besides the increased prosperity which would result from a large number of tho 49,000 persons at present employed unprolitably turning to occupations more Jilted to the circumstances of the colony. The best proof that Victoria is suffering severely from her suicidal policy is found in a comparison between her and New South Wales, which is practically, though not absolutely, a Fisetrade colony, and in Unit respect politically ahead of New Zealand. In order that our figures may not be questioned we take them from the " Annual" published by the Aye, the champion of Protection in Victoria, We have later ligures from other sources, and in accepting the Ayr. statistics we shall have to go back to 1884 (those being the latest at our disposal), but although in one way we weaken our argument as to the total loss, we gain by our figures be-

iny acceptable to Protectionists. In that yum-, although the i>o t -.ul;ition of New South Wale* was only 895,533 as against 045,703 in Victoria, the exports of the former colony amounted to £23 lls 7«l per pcail against dSIT 17s 7il per head in Victoria, anil (lie imports were respectively £24 17s Id ami £1!) (is lOd per head, the toial trade of New South Wales being £40,840,170 while the total of Victoria's trade was only £34,142,709. Victoria- has everything in her favor, a better climate and a larger population, and yet is outstripped liy her Freetrade neighbor. Moreover, New South Wales linds that slip does not need Protection to keep manufactories going, having 45,000 of her population engaged in manufacturing establishments. The proportion of revenue raised in Victoria by taxation is 4160 per cent., while in Freetrade New South Wales it is only 29"24 per cent. Here in New Zealand we can boast of nearly GO per cent., and yet a "Liberal" Ministry want to make it higher ! To cap the comparison in favor of New South Wales we will go to Mullia.ll, the celebrated statistician, who in lis " Dictionary of Statistics " gives the iverage wealth per head in New South Wales at £241, -while the average for Victoria is only £IDB, or £43 per head less. Surely even Protectionist?, must see that the only fair trade is trade free from artificial restrictions ! When trade is hampered to suit interested persons the sufferers are working people, the minority of " protected" workpeople only getting bare living wages, and the profits arising from fiscal swindles going to capitalist owners of factories and to shareholders in manufacturing companies.