CHAMBERLAIN AND THE FISCAL QUESTION

Otago Witness, Issue 2600, 13 January 1904, Page 13

CHAMBERLAIN AND THE FISCAL QUESTION

Ex Peect C. Haeeis. NO. 11. It baa been argued that a rise in the price of food would be followed by a rise. ia wages. Even granted thie would be so, though all evidence goes to prove the contrary, where would be the gain to the working man if the purchasing power of the money would be less. While the loss to the manufacturer dees not even require argument. What is England going to get in return for this sacrifice? Preference over foreign countries in our colonies for our exports to them I In most of our colonies the tariffs have been framed and are framed against us, and against us only. Their manufactures are in most oases similar to ours. The .colonists are mostly of Brit : eh birth and dcoeeni. They therefore naturally tend and manufacture what we can make here. It is in the trades that they start that they ask to get Protection from tiheir Governments. Pdhaps the most striking proof of this is the case of Canada. Sinco the inuch-talked-of preference her imports from the United States have increased at a greater ratio than her imports from the United Kingdom. The tariff was originally framed to protect native induetri&s, most of which lire staples in this country. Besides, the United States is Canada's nearest market, which brings u3 to another point. The colonies are not our natural markets ; foreign countries — France, Germany, Portugal — being closest to ue, are. The enormous distance that, for instance, New Zealand is away from us is equal to a bonus, in many ca»3es, to local manufacturers cf 40 per cent. If, however, we had anything to complain of in the share we get of the colonial import trade we might stand to gain something. What are the actual facts? The colonies at preeent import from the United Kingdom, together with Britisth possessions, very nearly, double what they import from all foreign countries ; while, leaving out British posseeeions, 116 millions against 80 milliono. I think thia shows we already have a very fair share of the trad« or the colonies. So long as -we have Froetrade wo iis-ed not be afraid of holding our own with foreign countries in any market of the world. Wo have hoard a let of late about tihe competition of foreign countries. We would imagine from all the talk there has boen about it that our trade had been steadily decreasing instead .of, as actually is the fact, increasing. Our export trade per bead remains larger than any country in the. world. It is true that other nations have been making great headway. Forty years ago nearly every country on the Continent had been the oeene of either a war or a revolution. There was no feeling cf stability or security; people were not Agoing to invest their money in industrial enterprises when any day the constitution might bo upset or their territories invaded. A proof of this was the almost total absence of banks. Great Britain from its situation was the only country which felt quite safe from foreign invasion, and where the people could sink their money in trade without any fear of losing it from political reasons. All this has bec-n changed during the last 40 years. There have' been no great European wars; even France has bean free from revolution; and the nations of the world have been ablo to devote themselves to industrial development. It is this that to a great extent accounts for the expansion of Germany, So long as she was tl*e veritable battlefield of Europe, and a mere conglomeration of email weak States, there was no encouragomont to thrift and business enterprise Now her people feel safe and secure, and aore forging ahead. Forty years ago the turbulent state Europe had been in gave us an advantage over Continental countries; now that their peoples feel secure this advantage has gone. There are other things that have helped foreign countries. Education i 3 belter abroad. In Germany and the United States tb&y are far ahead of us in secondary and technical education. In both these countries, too, they are more ready to adapt themselves to the n&ado of the different markets. Perhaps, also, the German and American principals are less inc-ined to neglect their business for grouse shooting or cricket. Not that I blame the British manufacturer for caring for other things bosidco Lis trade ; on the contrary, it is better, when he has made his fortune, to abandon the art of money-making for other pursuits. But do not kit him complain of foreign competition when it is really hia own neglect. If we ai*e to have an " inquiry," don't lot it be into our fiscal system, but into our education, our methods of doing business, end our dummy directors. I havo shown that there is no obligation on us to give preference to the colonies; that we have nothing to gain by it; and that in spite of hostile tariffs our export trade is steadily increasing, and remains the largest per head of the population in tho .world. Our Freetrade system has not been unkind to us. Yet there axe many who contend that we should protect by import duties our industries from foreign competition, and that, ait least, if foreign countries tax our goods we should retaliate. It is uselesf for va to argue that it has

all been tried before and proved a failure* ; that instead of helping induotry it handi- , capped it; that Sir Robert Pool, after years of experience, came to the definite conclusion that it was useless to attempt to use cur tariff to extort better te-rms from other nations, and that the only way to manage out fiscal systsm. was to frame it to euifc j our revenue requirements. Protectionists have never and will never listen to either history or political economy; they did not in 1840, and they will not in 1903. Take their outcry of the German invasion of our market. (See Board of Trade returns.) What are tho actual facts? By far the largest item of imports from Germany is bounty-fed sugar, about seven millions of which we have been getting under cost, and which by an Act of Parliament we are prevented from imposing a further duty on. The next meet important goods are '" wool! en a," which come to a little over one million oterling, of which article we export from Great Britain just -about 15^ millions' worth per annum, to say nothing of the much greater quantity produced for local consumption. As for cotton manufactures we import I ■from Germany a quantity valued at about ' £300,000 sterling, while we export from tria country something like 58 millions' worth per annum. The other items of importance ! consist of such articles as toye, glassware, j and musical instruments, in which Germany j is acknowledged to be far ahead of us in skill. With the cole exception of sugar, her exports to us cannot be said to have di>> 1-laced Irtish labour; while the very cheapness cf that bounty-fed article has brought into being in this country a number of trades which are giving more employment ' than would have been otherwise tho case, j Besides, of late our exports to Germany have been increasing at a greater ratio than our imports from her. Perhaps the most popular statement with the Protectionists is that our imports are larger than our exports. Of course they are, and so thoy have bee-n for the la^t 30 years. There is I an impression that the balance is made up of gold. If that was so in a- very short time we would be denuded of it. We don't pro- ' duce gold in this country; we have no gokf I mines; we can only buy it from the countries and pay for it with our manufactures. The reason our imports are greater than our experts is becauce we, when ether nations wore distracted by wars and revolutions were at peace, and able to accumulate wealth, much of which we lent them, and for which they have new to pay wi interest. The only way they can meet their engagements with us is to export to us goods which make up the exce-ss of our imports over our exports. Foreigners don't send us goods for fun ; the only way to get paid fcr them is to take back other goods in return. If other countries like to sell us articles under cost by all means let them do so. It pays us better to devote our energies to produce goods which we can make at a profit and buy with them goods under th© cost of production abroad. This is how the so-called " dumping " works out. Those who do it usually only rceort to ifc^when trade is bad in their own country. They soon get tired of it: before long it will mcfin and has meant the bankruptcy for the trade that has practised it. Perhaps the maddest Protectionist arguments of all is that which suggests that imports displace British labour; that high duties on foreign goods will mean more employment. As if other nations present us with commodities! They want payment, and as Great Britain cannot send in return food or raw material, ehe pays in other manufactures, which give just as much employment as if she made tho " imports " herself, only that the labour is more profitably used. By adhering to the principal of buying in the oheapest market we get the fullest reward for our labour. The difficulties of framing a Protectionist tariff are, so we>ll known and generally acknowledged that I need not dwell on it much. How to settle which industries are to bo especially favoured, where to draw the line, what aro to be the amount of duties, how these trades left out are to be compensated for the rise in prieo in their instruments of production — all the.se questions are a source of never-ending worry to the Protectionist financier, and can be seen annually troubling the Parliaments of our neighbours. Nor need I say much on the consequent corruption and oonstant "lobbying" •nhich it entails. If you feel Protection ii 3 going to do half what its exponents claim for it no doubt you would put up with httle disadvantages of this sort. From all the talk there has been on our export tiade one would think we only made goods to ship them at once out of our country. As a matter of fact, ar> any manufacturer and any statistics will tell you, our home trade is very much more important. This is steadily on the increase, and the consumptive capacity of the nation gets greater every year. Owing to cheap food and i'reetrade the housewife has more to spend on Homo manufactures. As ehe gets her glass cheaply from Germany, her silks from France, and her food from America, where they can beet be produced, she has more to spend on Irish linen, on Manchester cottons, on Scotch woollens, and British jams. If we had Protection we would be waiting our energies in making glass, instead of buying it with woollens and cottons, and our housewife, Laving to pay moro for it, would have less to spend on othe-r articles. The fact is Great Britain is not declining in prosperity; but we are not in a state of Elysium yet — far from it. There is much to be done to improve the condition of the people. But there has boen steady and healthy progrees. The population has increased during tue laet 60 jcais bj some 10

millions ; pauperism and crime are both on tho decrease, ac all statistics show (30 years ago paupers numbered 12,000 ; the- latest figures cihow that in spite of 10 millions increase in tho population the number of paupars remain the same). No little of this state of affairs, I maintain, is duo to Frc-e trade. In spite, ibf the Gmallness of our territory compared with tho fiscal units, in spite of the fact that we cannot produce c-nou&h food to feed ourselves, in spite of the enormous strides other nations have mad© of late- years, in spite of hostile tariffs and the jealousy of our rivals and their superior advantages in education, we steadily advance in national prcspcritj'. If there is any fault to bo foimd in our material progress it is in the distribution of wealth, not in the increase of it. It is certainly not likely to improve mattei'3 by taxing food — by taxing the necessaries of life. There are many who consider that there is no necessity to defend Frcetrade; that ths nation has such implicit confidence in • the soundness of the policy that the argu- , mc-nts in Us favour arc so strong that it can '. never be in danger. But you have arrayed against it all the forces of ignoranoe, prejudioo, and commercial selfi^hne-rs. There are , pome who, though knowing that it will ' injure the nation at largo, hope to got ' advantages for their own particular trade'; ' there are landlords who expect to get higher rents for their land ; there is that dangerous eia^G that is always arrayed against log;c . and reason, and is ever ready to champion everything reactionary. Do not let us underestimate cur enemy : we are going to win, but we must fight him, then we will ' come out of the battle stronger than ever, and vith " Free trade " so thoroughly proved I and tested that it will be never in dangsr again. 8 Southwick plaoo, London.