FEES TRADE AND PROTECTION

Lyttelton Times, Volume LI, Issue 5611, 18 February 1879, Page 6

FEES TRADE AND PROTECTION

ThbYbbdict of the Fbbnch Senatoeiae Commission op Imquiey.

The Paris Correspondent of the Alia California writes: — On Nov. 29, 1877, the French Senate adopted a resolution providing for the appointment of a Commission of eighteen members, to investigate “ the causes to which may be attributed tne sufferings of commerce and industry, and to suggest remedies.” The first meeting was held on Dec. 4 following, and the inquiries weresontinued until the 2nd of last April, when the testimony taken for publication was closed.

I have obtained a copy of the reports of the meetings, including the letters from the various Chambers of Commerce of France, and the report of the Commissioners, based upon the evidence before them.

The general impression which is to he gathered from the results of this investigation is, that before long the great commercial nations of Europe will be obliged to put up a wall of protection against American imports, instead of pushing free trade doctrines. What they fear most is the competition of our exportations in the markets which they have heretofore controlled} but they are concerned also very seriously in protecting their home markets. I will, as soon as I have time, furnish extended translations and extracts from French and British reports on this subject, all of which will turn on the question oi the alarm created by the industry of the United States ; but in this letter I will only attempt to collect brief extracts, to illustrate what I have already written. , The cotton industries receive the attention, for in this branch there is me greatest competition. The delegates of tfi‘ Industrial Committee of Flers, Department o Ome, submitted to the Senatorial uommisgo a deposition in which they said that the number of workmen employed in cotton factor! of Flew, in 1860, was 29,000; in 1876 it ™ reduced to 12,000, and in 1877 there wafurther diminution. They gave a detan picture of their distress, and say: “Such, is, gentlemen, the situation P duoed by treaties of commerce for the ina try of Flew, so active and so flourishing F to 1860. It is now on the point of the struggle—crashed by the mass of to t importations. * * * * . ars "Other industrial centres have pe™A suffered less than ours up to this time! how can they struggle against P° we „, mIS dnstrios which have assumed an eno *, ffl i development, such as those of Eogla na -“ the. United States ? The latter rapidly, and inspires a feeling of anxiety in England. Our industries will certamff succumb. j .iU “Before 1860, British industry «?PP“fr d # Asia, all Africa, almost all America, neat part of Europe. Since that tun o ; . . Baa established a great, number of and ifeaving-fuotoxms to use the cotton. . is raised there. It tends to satisfy X United States, thanks to tariffs, have developed all the t j pD especially that of cotton. Their prod L e j i» in excess of local consumption. . «®o*fe a part, and sell even i» LnuTheir efforts are incessant toward tne frusture by themselves of all the cotto - nce they produce, and we know by exp 0 j how prompt and powerful are their m* action. ’ n ttoO ‘‘ln Russia, Spain and Italy, promdustry progresses under the shelter tection. Austria and Germany pero, are need of protecting their industries, preparing themselves for it. the? Switzerland, which produce more e fend need and export, are preparing * pro tcc' themselves ‘against importations oy r . jo tion. • • S * Is it not evident Consequence of the disproportionate i ,^ n 0 t production of England, of the diim -plies* the number of countries which ? and of the" development which i

■the United Stages assumes, French industry •9 destined to perish, if the tariff is nothinpressed, and if, according to the example of other countries of Europe, it is not protected hr sufficient taxes ? ~ . * jf 0 belief in Free Trade; this is the refrain which comes up from nearly all the industrial centres of France. A few only preach free. trade in the form of special treaties of commerce, in the hope of breaking down some of the threatened competition, , and ,to keep markets open to them, which protection reserves for the benefit of local industries. France is beginning to feel that she has already suffered too much disadvantage from special treaties with England. She is learning what the United States should know, that great rival industrial nations cannot indulge in free trade with eaoh other, without witnessing the destruction' of those vkhbse energies or advantages prove the weakest. [The field for the competition of rival industrial nations is in the countries which do not excel in industry. That is why England is so great j she _ seizes upon the undeveloped colonial, semi-barbarous and barbarous trade. It is in that field that the United States must compete for markets—South America, Africa, the Orient) China. Italy may be a better market for us than France, because we are not rivals. Rivals will surely protect their home markets as soon as they are seriously threatened, and that is what France will do, and what she now threatens, notwithstanding the insane talk of a few enthusiasts, who imagine that the United States can be humbugged into abandoning all rivalry. After all, however, the first necessity is the protection of home industry, so that a nation may be as nearly self-supporting as possible j the rivalry in exports is of secondary importance, and omen dangerous. The Flers delegates said: “Wherever industries have been established and have prospered, they have produced the greatest possible advantages for their workmen. The ruin of these industries would be, therefore, very prejudicial to workmen and to agriculture. Why suppress the work of these workmen to give it to American workmen, or others. Will foreign workmen ever bo consumers of the products of pur: soil and of our. diverse industries, as the French workmen are ? * * •' "When the Treaties of 1860 were made, they were not; intended to destroy Industries. It was hoped, on the that great prosperity would follow in the near future. * * * Ten years afterwards these promiees were not fulfilled. Industry, far from being prosperous, was very unfortunate, and, on the occasion of the investigation which took place at the end of 1869, Mr Forcade, ofLa Boquette, a strong partisan for free trade, and one of the originators of the Treaty of 1860, agreed that the cotton industry was not sufficiently protected, and that there was something to do.” These remarks are precisely apropos to the UmtedStates, with slight alterations, in case. , the proposed treaty with France should be seriously considered. We are asked to' abandon our silk, leather, wine, glass bottle, and other industries in favour of French workmen, and to take, in exchange for our goods, wheat, beef, and crude petroleum, rotgut spirits, adulterated wine, and French silks. We had better produce our own pure wines, manufacture our silks, and give our wheat and beef to nourish the American workmen, who produce them, and our petro- 1 leurn to light their homes. This is the true ' principle of national domestic commerce, and is the sole means of national strength. Other 1 nations, when the current of trade begins to run against them, will protect themselves j against foreign attacks. We have done this, and must maintain the position taken, or relapse into distress, such as France is now ' suffering. j The letter of the Chamber of Commerce of St Etienne says, on its first page : “Indeed, s the United States of America, having imposed prohibitive tariffs upon all European ' products, American industry itself manu- \ factures to-day the iron, cotton goods, . -woollen stuffs, silks and ribbons, which that j country used to demand formerly from 1 France arid England.” St Etienne is inter- ■ ested in the silk trade; hence, is in favour of ; supporting existing treaties. The letter adds: “ We demand, with all our force, the prompt conclusion of treaties of commerce • with all the European nations, and, if pos- ( sible, with the United States of America.” \ The letter of the Committee of Normanby, dated at Rouen, shows that other nations are ! rapidly becoming protectionists, and will . force France to imitate them. Here, however, it should be remarked that the notion of free trade in France is very confused. They have no real free trade worth speaking of. Certain countries have been granted special privileges; but there are many things which are absolutely prohibited from importation, and the internal system of octroi taxation is only another form for a high tariff, which injures domestic as well as foreign trade. Each city is walled in, as 1 have before remarked, by a special tariff, which renders free circulation in France impossible, even for her own products. The Bouen letter is very exhaustive and interesting. Under the • third heading, ( “ England Grappled with by the Industry of , the United States,” it says:—“England has j come to swords’-points, during the last four or five years —that is, since the enquiiy of 1870—with a most redoubtable industrial rival, the United States, built up under the shelter of protection, and which becomes more and more formidable. AH is henceforward transformed, and the hour is not distant, if it has not yet been sounded, when England will regret having developed beyond measure her manufactur- : iug production. Europe, excepting France, 1 shuts the door against her. Let us see what the United States are doing.” The letter then reviews the report of the British Consul at Now York, in which is set forth that American exports of cotton goods to and Scotland increase each year, and imports from England decrease. The Manchester Courier is quoted, showing that “ the reports of our (British) Consuls from many other countries are similar. The Americans drive ns ont of their markets, and come to compete with us in our own. They are not content with sending their products to Liverpool, but they compete with us also in our Colonies and dependencies.” The article quoted enumerates statistics of our cotton exports, and adds:—"American competition affects us everywhere, and will finish by beating us, considering that their exportations of cotton products have increased regularly since 1872. The result of this competition with •England in her own possessions is no longer a chimera, it is an established fact.” The letter also shows that our exports of cotton goods were in 1872 valued at 2,304,830d015., and increased, rapidly to 14,000,000d01f1. in 1876. It argues that the result of this cqmpetition will be to throw the excess of British goods upon the French market, and that the only safety for the French is in raising their Concerning wines, the Houen letter says t— * “We do not contest the fact that the wine merchants are making active movements m favour of free trade. ■* . * * * * yet what can viticulture expect from England in respect to its exportations P ” It is shown, than that the reduction of the English tariff on wines no great advantage to France for during the most favourable year the export to England has not surpassed 7 800 000 gallons, much less than the annual consumption of a French city of 200,000 inhabitants. “ The end pursued by the viticulturists,” says the Bouen Committee, “is therefore chimerical. France is their best customer, and especially industrial France. Viticulture Vonla have good cause to complain if this customer should cease to work.” Tfow powerful the last remark is when applied to .American agriculture, which sometimes complins against the protection which enables American workmen to consume American products ! - . ••• These remarks on viticulture illustrate the position of this industry in France, as I have before pictured it. French consumption, constantly increasing, renders it impracticable as well as chimerical, to increase largely the exportation of pure naturalrwines. The demand for treaties, however, comes more from a desire to maintain the commerce in, cargo, wines and to restrain viticulture in oun country, which must inevitably 'educate our people to prefer pure natural pro-

ducts.' There is something of jealousy as well as interest involved in the movement. The sixth paragraph of the “Eesnm£” of the conclusions in the Rouen letter is as follows:

“That England is everywhere at war with tlm com petition of the cotton industry of the United States; that she sees her markets diminished throughout the whole world; and that, throwing herself more and more ujjon France, she will ~ succeed rapidly in ruining our national production if some! remedy is not adopted quickly.” f The seventh paragraph is: " That French agriculture and viticulture, cannot boast, of the results of the treaties of commerce, and that they are interested really in providing that industrial labour should facilitate the consumption of their products to Franco.’* The letter from the Bordeaux Chamber bf Commerce, inspired by the able President, Mons A. Lalande, of whom I have heretofore written, "is full of sophistries in the interest; of the Bordeaux manufacturers of bottles,' false labels, and vins de eargdison,- It begins, as all communications do, with attributing the principal cause of the disturbance in Europe to the United States, which offers no longeri a Colonial market for the poorest qualities of European _ manufactures, - Then, in the face of this snowing, it calls the prosperity of the United States an “ artificial” one, and repeats the stale argument, which Mons Lalande offered to me while I was in Bordeaux, that the United States is essentially an agricultural country, and should open her markets to European, and especially French, workmen. In other words, the desire is that the United States should consent to remain in the Colonial condition, and depend upon Europe for supplies of manufactured goods. It, however, naively suggests that the United States 1 is beginning to see the error of her ways, and is considering a change of tariffs to suit the demands of France!

I will not pursue these questions, raised oh the evidence taken by the French Commission, further, but will come to the report itself. It is sufficient to say that all the refrain of trouble turns upon the United States which has offended the great nations by emerging from the colonial condition into a position of dangerous rivalry. The report itself, accompanying the evidence taken, bristles on almost every. page with the words Mats Tims (United States). I find in rapid succession in the report, passages which I translate literally, as follows: — Relating in brief the unusual progress :of manufactures in Europe up to 1873, it adds: “ This abnormal increase was necessarily followed by deceptions, as much more cruel in Europe as, in the same time, that the production developed them to excess, a veritable economic revolution was taking place in the United States of America. Under a system almost prohibitive, since the duties reach to 50, 60, and even 90 per cent., the United States, until then a country of consumption, organised a powerful industry, the products 'of which can now rival in cheapness those of England herself. “ Called before our Commission the 10th of last December, Mr Ozenne, then Minister of Commerce, showed that the cotton goods of the United States were competing vrith English manufactures in London and Manchester. American metallurgy has reduced to nothing the importations of English metallurgists, vast establishments produce and work in iron, and our colleague, Mr Arbel, has seen at Philadelphia factories which construct up to four hundred and fifty locomotives per annum, or more than one locomotive per day. The American tanneries, watch factories, in a word, all the industries suffice, not only for the wants of domestic commerce, but also take part in the markets of South America, Canada, China, and Japan. From importer, the United States have become exporter. “ Thus, therefore, it is, at the very moment when Europe was pushing to excess her means of production, that a country of consumers was not only shut to her, but even transformed itself into a redoubtable competitor abd disputed with her a part of her outlets.

“In such conditions, a crisis was inevitable in Europe, and it would have happened even without the political complications, which have intensified it.

“Deprived of her outlets in certain markets, and encountering competition in all the other, England, who was prepared to supply the whole world, threw herself with more earnestness upon her rivals of the Continent. Condemned to produce without ceasing—for the closing, even temporarily, of her workshops would cause more trouble than working at a loss—she has reduced her prices to the lowest limits, so as hot to be stopped by the Customs’ duties of her neighbours. The result has been a general depreciation of manufactured products, a depreciation which must increase, because there exist enormous stocks, which, even with a pacific settlement of the Eastern Question, cannot find a normal outlet. “Production is, therefore, no longer in accord with consumption, and it is difficult to believe that the equilibrium can be re-estab-lished, for, in the future we must always count upon the industry of the United States, of India, that which is springing, which propose to protect their domestic trade and export in their turn.”