FISCAL POLICY

New Zealand Mail, Issue 1732, 10 May 1905, Page 72 (Supplement)

FISCAL POLICY

TALKS WITH COLONISTS.

(From O'ur Special Correspondent.) LONDON, March 24.

Sir W. R. Russell, M.H.R., who is on a pleasure trip to the Old Country, expects to return to New Zealand, in time for the opening of Parliament in June. His visit is in the nature of a holiday, and he has at present no fixed p.ano; biu no doubt he will take the opportunity to look into public matters of Anglo-Colonial interest during his stay in this country. In conversation with Sir William Russell, I found him an interested observer of the fiscal controversy which now divides puDlio opinion in this country. Like most New Zealanders, he sees in the continuance of the present fiscal policy the seeds of disintegration. He has always been a free-trader by conviction; but when he sees foreign countries subsidising their own shipping and manufactures and levying heavy duties on British goods, "when lie sees them dumping tlieir wares into England at prices against which English makers cannot compete, and at the same time raising tar ff walls to shut out British wares—then it seems to him that England’s socalled free trade is a very one-sided arrangement, under which the British manufacturer is very unfairly handicapped. Under the present system, too, American and foreign trade with the colonies is advancing at an astonishing rate, showing in the. past decade an increase out of all proportion to tho growth of British exports” to the colonies in the same period. Colonial merchants who would prefer to trade with British firms are sometimes compelled by business considerations to order their wares in America, simply because they would be losing money by passing over the cheaper article in favour of the dearer British one. Thus mutual interests between Motherland and colonies tend to become weakened by the growth of new trade relationship and as sentiment is largely the outcome of mutual interest, the change does not make for a strengthening of the sentimental bond of Imperial union. ‘Tt seems to me,” said Sir William “that unless something is done to improve the fiscal policy of the Empire disintegration must sooner or later take place.” Ho pointed to Australia as an illustration of the way things were tending. There was no question as to the loyalty of Australia, but the feeling of affection for the Motherland was admittedly less strong there than it was in New Zealand. Why was that? Simply because Australia is fifty years further away from England than New Zealand is. Forty or fifty per cent, of the New Zealanders are British born, but the percentage in Australia is far less, and the preponderance of nativeborn Antipodeans made a marked difference in tho feeling towards the Mother Country. As the percentage of Britishborn colonials decreased with the lapse

of time, tho tendency would be for the to lose touch with and drift away from the Motherland unless the sentimental bond was strengthened by mutual trade interests. To the Britishborn colonial such a prospect was far from alluring. “I don’t like to think.” said Sir William, “that my descendants will nob ba British.” MR D. J. NATHAN INTERVIEWED. Mr D. J. Nathan, president of the combined Chambers of Commerce of New Zealand, is given the picturesque role of Macaulay’s far-famed New Zealander in an interview which appeared in the “Pall Mali Gazette” last Monday. The subject of his monologue was England’s fiscal policy. “If not actually upon London Bridge, it was very near to it that I met Mr Nathan,” says the interviewer, “and lie looked far beyond St. Paul’s when pointing out the very plain evidences of British decay.” The New Zealander disclaimed any hostility to free trade, provided it was the genuine article. What he and others objected to was the spurious free trade which tied England’s hands in the unfair competition against tariff-protected rivals. “What we believe in,” be said, “is the interchange of products at natural prices, and that, we say, you do not have at all.” He went on to point out that New Zealand had prospered exceedingly in the last decade under a small tariff spread over as large an area as possible. “I question,” he said, “whether, with our so-called protective tariff, we are paying more per head than you do for Customs and excise.”

Mr Nathan proceeded to demolish some free-import fallacies. “There is,” he said, “a great deal of nonsense talked in England about low-priced labour producing the cheapest goods. This is put forward as an argument for not putting on a tariff. Any student of the question knows that cheap labour is useless under modern industrial conditions, and statistical bureaux everywhere prove that, on the contrary, the cheapest goods are made by the highest priced labour. That seems paradoxical, but go into the question and see if it is not so. Apply the test to Glasgow and Lancashire cotton, to the cloth industry of the West of England, or to the nail industries of America and Staffordshire. In America a nailer will make £6 a week in his nail mill by turning out two and a half tons a iveek, while the Dudley nailer, earning 15s a w'eek, works" on his old method and only produces 2cwt. Thus the earnings are eight-fold greater in the case of T the American workman, w r hile the labour cost is on!®- one-third that of the nail produced by the English workman. This is only illustrative of a principle which runs through all industries, and sljpws the fallacy of laying so much stress on cheap food if the workman is not getting enough to buy it.” Mr Nathan, for another illustration, showed how Canada had increased her sugar trade since a preferential duty was imposed, and at the same time pointed the moral with regard to Hie sugar-growing islands of the Pacific, which, he said, would have served as valuable additions to the Empire had the bounty of two years since been out on a generation or two ago, and a little less attention liad been paid to the noisy Manchester school.” With Mr Nathan, as with so many Britishers in the dominions beyond the seas, the question of preferential trade is largely bound up with the larger question of the fed oration, of the Eng-lish-speaking races. “ This is no new tiling with us,” Mr Nathan points out.

“ Before ever Mr Chamberlain mentioned it, men like Sir George Grey, Sir Julius Vogel, Sir Henry Parkes, Sir Charles Tupper, Mr Cecil Rhodes, and Mr Seddon had been advocating it; in fact, it has been before the in one shape or another since 1857. Colonials, or, as I should prefer to call them, ‘Britishers,’ have long preferred to take the larger view of this matter, and, in claiming their birthright, to claim with it the right of a say and a vote on all Imperial questions. We claim, and have proved our right to claim, our interest in maintaining the Empire and the Slag. “ The capital that England has formed for foreigners,” continued Mr Nathan, “has created a wealth which is noiv used against us, and one of the effects is to be seen in the money Englishmen have to spend to keep up the navy.

“ir tha stream of people and investments could _be diverted from foreign lands, the increased cost of defence cornu bo spread over a larger area, and w'oro w r e, the children of the Empire, admitted as junior partners in the management of the Empire, do you think wo should shirk from paying our just proportion ? I say we should willingly pay our share. We are not doing so now, but admit us to your counsels and we shall not shirk our responsibilities. There can ba no tax without representation, and the latter must come if we assume the former. The sooner the better, I say. “Why should you drive us to trade with foreigners,” was Mr Nathan’s pertinent remark at the close of the interview, “when we are so anxious to trade with, you ? There is nothing that tha Empire could not supply within its own borders, and nothing it could not do if it would take the time and trouble to establish an equitable preferential trade.”