EMPIRE ECONOMIC UNIT.

Putaruru Press, Volume VI, Issue 231, 5 April 1928, Page 4

EMPIRE ECONOMIC UNIT.

READERS who take an interest in Empire affairs will have noted the various movements towards Empire Free Trade. Taking a long and broad view, there is little doubt that this policy will be pursued unto fruition, however long that the end may take to be achieved. Apart from .sentiment—which after all may be the better quality of life—the cold logic of economic events is slowly but surely driving the British Empire into Empire Free Trade. The United States, although a protectionist country to the outer world, is really, on account of her vast geographical extent, and her huge population, the greatest Free Trade country on earth. There are no tariff barriers between the various states, the unity of which forms the United States; neither should there be any such

hindrances to trade between the states which together comprise the British Commonwealth of Nations, or the British Empire. Further on in this article it will become apparent how the Empire tariff policy affects us in this dairying district of the Waikato.

The writing of this further article upon the subject above-named has been prompted by the receipt of a very able, closely - reasoned letter from an English authority, Mr. A. E. Tomlinson, entitled “ The Rationalisation of Industry: What it will mean to the Empire.” Very appositely, Mr. Tomlinson says, inter alia:—

“ Looking at the world to-day we find a new re-grouping and reorientation of forces taking place. On one side of the Atlantic is a rich and enterprising country with immense natural resources, no lack of brains and vitality, intensely materialistic and highly efficient. Though almost the size of a continent it has free trading within its borders and has the whole of a vast home market sheltered behind mountainous tariffs. Already one of the Dominions, Canada, does a greater volume of trade with that country than with Britain, and there will always be a force of trade gravity drawing them to a closer rapprochement. “ The United States is one great economic group. On the other side of the Atlantic we have gradually forming another economic group, the projected European Customs Union. Faced by severe competition from the United States, the various countries and nations are being driven to sink their prejudices and animosities and merge their interests in an economic alliance. This second world grouping, the European Customs Union, has become almost a fetish with business men on the Continent.

“ Amid all these contending forces what is to be the position of Britain? On the one hand she is being urged and cajoled to join the European complex; on the other is the possible policy of isolation. Either of those alternatives would mean sacrificing all that. we gained and all that we bled for in the Great War. “ There is only one policy for Britain and that is the policy of Empire. Standing alone she would be swamped by the other world groups. Joining any one of them she would fatally weaken the ties of Empire and throw away the trump card in her hand. As a component part of the British Commonwealth of Nations, however, she could face world competition without a qualm.” The author’s reasoning can be all the better grasped when we realise that the United States has an area of 3,000,000 square miles and over 100,000,000 population; Europe less than 4,000,000 square miles, and a population of 420,000,000; while Great Braitain has an area of only SB,OOO square miles, and a population of less than 50,000,000. But—and here is the point—the Empire as a whole has an area twice that of Europe and the United States put together, and a population greater than that of Europe! With our vast and varied resources the Empire would be in an impregnable position if we would only combine—and, as the eminent economist, Mr. J. M. Keynes, says “it is only lunatics that never combine.” From the above it is not difficult to perceive that if there was Free Trade within the Empire the dairy produce, pork, mutton and other staples from New Zealand would be far more solid on the London market than is the case now, when Denmark and the world in general has free access, on an equality with ourselves as regards tariff, and the advantage of contiguity against our 13,000 miles of sea transport.

Mr. Tomlinson points the way also in regard to industries that have sprung up under tariff protection and could not live without such cover: “ AH that is needed is full economic co-operation. How that can be secured is for the business men and industrialists of the Empire to work out. We cannot expect those countries, like Canada and Australia, which have fostered young industries behind tariff walls, to sacrifice them and be content with farming in all its branches. All those problems would have to be solved by means of quotas of production and allocated markets together with an Imperial compensating pool for such industries as suffer under the new arrangement. All these devices are familiar to anyone versed in the direction of great industries and could easily be put into operation. Finally, the whole Empire economic unit would have to be protected by tariffs, but with complete freedom of trading within its own borders.” As time goes on this question of Imperial Free Trade will become more and more pressing, and Mr. Tomlinson’s article constitutes a notable contribution towards the realisation of the dream of an Empire economic unit.