The Waikato Times with which is incorporated The Waikato Argus. TUESDAY, APRIL 15, 1930. AUSTRALIAN PROTECTION.

Waikato Times, Volume 107, Issue 17996, 15 April 1930, Page 6

The Waikato Times with which is incorporated The Waikato Argus. TUESDAY, APRIL 15, 1930. AUSTRALIAN PROTECTION.

The recent action of Australia in greatly stiffehing her Customs tariff h'as led to some discussion in various countries of the general question of protection or free trade. ■ Air Baldwin, whose party is divided on, the question, has succumbed to the protectionist wing, and has been making some statements in Manchester which seem to argue a very imperfect knowledge of the facts. He says that safeguarding for the first time gave Britain a weapon with which to negotiate. This is an opinion which is commonly held, although an ex-Prime Minister would hardly he expected to say so. The truth is that in all cases Britain enjoys the most favoured nation clause. Any advantage which one country gives' to another is automatically given to Britain. This is not wonderful, for Britain is still the largest free market in the world, and no country cares to run the risk of being cut off from it. Air Baldwin should make more enquiry before giving utterance to statements so incorrect. The fact that safeguarding is a '‘Conservative invention apparently leads Jiim to claim great .virtues for it. It is a system by which protection is granted to a number of small industries of very slight importance. Some of them have done a little better; some a little worse. It is doubtful whether any have increased their export trade, while many have decreased it. As an economic movement safeguarding is hardly worth considering. It may have done a little good hr a little harm. In any case its effect is small except in the particular that ft weakens Britain’s argument for lower tariffs. Air Baldwin promises that no. food taxes shall be imposed without a referendum, which is equivalent to saying that they will not he imposed at all; but he says nothing about wool, which is of some importance, and does he propose to tax raw cotton from' America? That would seem to Lancashire very much like hitting a man when hr is down. Air Bafdwin has already had a lesson on the unwisdom of going to the constituencies with protectionist proposals. Apparently he has forgotten It. In America the New York Times has been commenting on the Australian action, and recognises/that it 21211 affect the United States as well as Britain. It finds what comfort is possible in the thought that Australia’s action will put an end to preference for Britain, which is certainly likely to happen. The strange thing Is that Australia, which has imposed, a tariff to make her self-supporting should have so utterly failed in her intention. She has now decided to try a stronger dose of the policy which has so far failed. America, uf course, cannot complain, because! they have for many years been exponents of the same policy, and now realise why Canadians and South Americans show such resentment at her constant increases in tariff. A recent item of Australian news shows how futile is the idea that protection can create trade. The Australian Iron and Steel Company Lave closed their blast furnace at AVoollongong and thrown 1500 men out of work. Other Australian factories are anticipating increased trade because of higher duties, and do not st-op to enquire where their customers are to come from. The agitation respecting customs duties is of less importance than is commonly supposed. As far as Britain is concerned she cannot afford to impose duties on food or on raw materials, and, her imports outside these arc small. America’s prosperity is not due lo Protection, and the free trade which prevails within her borders lias more to do with it. Protection does not permanently prevent imports. It raises the price of goods in (he protected country to such an extent that imports can pay the duties and yet compe-te. What Protection does do is to disorganise trade for a time until it settles again at the higher prices. For some

time America lias been revising her tariff and increasing the duties so often that trade is disorganised much of the lime. The constant demands for higher duties aro tho clearest proof that protection docs not keep the trade in tho country which imposes the duties. Economically protection is a failure; politically it is much worse. It is in essence selfishness, and the sight of any country endeavouring to keep its good things to itself and refusing. to share them with its neighbours is the chief prelude to the resentment that is the forerunner of war. It is true that protection does not actually benefit the country that imposes it, but other countries think it does, so that it acts as an incitement to bad feeling. Great Britain has been successful in the development of Empire because she left each part to develop its own trade policy. If she departs from this and shows favour to one Dominion and none to another; if she grants preference to Canadian timber and none to Australian wool or New Zealand dairy products, we shall cease to be the happy family we have been. If bad feeling is created by devotion to the hoary old superstition of Protection, the people who permit it will have themselves to thank. In this country we indulge in some of the most weird and wonderful pieces of protection that can be found anywhere. Our duty on wheat is a monument of unwisdom, and that on cement is equally wonderful, yet while farmers and manufacturers complain of high costs no one challenges these follies. The protected Interests are well organised, extremely vocal and have to do with politicians and public equally Ignorant and prejudiced.