OBSTRUCTIONS TO TRADE RECOVERY.

Otago Witness, Issue 3775, 20 July 1926, Page 4

OBSTRUCTIONS TO TRADE RECOVERY.

INTERNATIONAL COMMERCE A NECESSITY. FALLACY OF THE SELFCONTAINED COUNTRY.

By Hartley Withers.

All the nations are keenly interested in the recovery of international trade, on which they all, in varying degrees, depend for their own prosperity and growth, and yet all have been busy in the last few years in putting obstructions in the way of it. Prohibitions of imports and exports, new tariffs in countries where they did not formerly exist, higher tariffs in those which have always used this method of collecting revenue, vexatious Customs regulations whicn make the effect of tariffs still more obstructive to the movement of goods across frontiers, endless changes in classification which make the merchant uncertain under what heading his goods are going to oe taxed when they reach their market—all these things mske foreign trade such a nightmare of uncertainty and difficulty that it is really marvellous that its volume should flow as fully as it does. That under such conditions the exchange of goods between the nations has not been more seriousy checked is due to the fact that it is so essential to the life and comfort of all of us that it forces its way on in spite of official obstructions. The sound instinct of the average man is to secure for himself and his dependents such comforts and necessaries as make life-in this queer world possible and pleasant and to increase his command of them as much as he can. The world’s economic activity depends on satisfying this healthy instinct and in older to do so is bound to distribute to all markets, in which a buyer can be found, the products of all the climates and capacities that are found throughout the world. The freer the distribution the more easily and effectively this task is done. Anyone who ivas told that his prosperity was being furthered by prohibitions and obstructions which obliged him to confine all his purchases to shops in his own street or in his own town, when he knew that there were better and cheaper goods to be got round the corner or a f ew miles away, would laugh the suggestion to scorn. And yet we find many of the citizens of all countries not only passive, but quite pleased when their Governments impose restrictions on foreign trade which are only an extension of this principle. Why should this be so? Everybody knows that when he or she starts out for a morning’s shopping he will spend liis money to the best advantage if he is least restricted in choice as to where he buy 8 any articles that he wants. Nevertheless many of us are content to have choice restricted by obstructions to international trade and to be confined, either alt. Tether or more or less, to goods produced in our own country. It is supposed to be a question of patriotism. No instinct is more lofty and laudable than patriotism when it is properly directed; and if the sacrifice to which people submit by being restricted in their purchases of foreign goods did their countries any real and lasting good one would take off one’s hat to the readiness with" which they make it. But if it be true —and it seems to be self-evident—that all countries depend for their prosperity on foreign trade, it is surely a great mistake to submit to these obstructions out of a mistaken belief that we are helping che prosperity of our country, when in fact we are hindering it. In England we are constantly being told to buy British goods, and many wellmeaning people make most conscientious efforts to do so as exclusively as is possibly, because they believe that it is a patriotic thing to do. But is it? England above all other countries depends for prosperity on her own export trade, and on the free movement of goods between other nations, because she is one of the world’s greatest exporters and her industry is equipped for that purpose and also because she is the great ship owner and shipbuilder, and her ships can not flourish if foreign trade is slack, and if ships do not flourish, shipbuilders will not get many orders. But at present her export industries are with few special exceptions slack* and her shipping and shipbuilding are depressed, chiefly because foreign purchasers cannot afford to buy her goods or to deal as freely as they used in the commodities produced by one another. This inability of foreigners to buy is evidently increased every time that an English man of woman refuses, from patriotic motives, to buy anything that comes from abroad, and so the effect of mistaken patriotism is simply this, to increase the industrial difficulties of England, at a time when she surely has'enough, of them to meet without the assistance of patriotic fallacies. If only neople would remember that every time they buy goods from abroad they are giving an order, to their country’s export trade, because goods do not come in for nothing, but have to be paid for by some form of export, they would clear their minda of a delusion which is at present working incalculable harm all over the world.

In countries at an earlier stage of development, the same sort of patriotic delusion makes the average citizen ready to buy dear and inferior goods, because he thinks that he is thereby furthering his country’s industrial development and helping to make it as far as possible selfsufficient. Under the influence of this ambition countries with enormous possibilities for growing crops and produce that the world needs warp their own growth by trade 'obstructions which keep out manufactured goods and keep their in the town producing, under artificial conditions, goods that can be made much more cheaply and well in the old industrial countries. The result is that the obstructing country has a nice new industry, which flourishes safely behind the obstruction, while the consuming citizens pay a high jprice for an inferior article { the export industries in the old countries languish, the capital and energy

that is needed for the agrciultural develop-, ment of the new country has been turned into a channel in which it can only prosper by means of an expensive obstruction, and so all the world is deprived of an addition to its supply of food and raw materials. For everybody except those who wax fat on the profits of the artificially fostered industry, the los and dislocation produced by this patriotic fallacy of self-sufficiency is evident. And why should any country want to be self-suffi-cient? An individual who had such an ambition, and wanted to make his own boots and clothes, and rebuild his own house, and grow, his own food, would hardly be an economic success.