THE LIBRARY OF THE UNIVERSITY OF CALIFORNIA LOS ANGELES . ^? FREE TRADE u. FAIR TRADE. t^v V FREE TRADE versus FAIR TRADE. LORD FARRER, (Some time Pcnnaiuiit Seortayy of the Boaicl of Trade.) NEW EDiriOX WITH NOTES AXP LATEST STATISTICS BY C H. CHOMLEY. TUliLl'SHED BY ' THE FREE TRADE UNION 8, VICTORIA STREET, WESTMINSTER, SAW BY AKKANGF.MKNT WITH THE COBUEN Cl.l'B. 1904. Price 5s. net. - ^VUi^/a^C PREFACE T(3 THIRD EDITION. /^^^f- t^lN the Third Edition I have brought the statistics ^ down to date, and, besides this, I have added, in ^ Chapter II., some observations on the utterances of g the latest champions of Protection — Lord Penzance .^ and Mr. Henry H. Howorth. I have also added a chapter (XXV.) on the effect of Protection on wages and employment ; another (Chapter XXVII.) on Protection to Irish manufactures ; another (Chapter XXXV.) on the foreign trade of Germany ; three more (viz. Chapters XLL, XLIIL, and XLIV.) on the present depression in France, Russia, and Belgium ; o and another (Chapter XLV.) containing remarks on 22 the present commercial depression generally. In ^ writing these chapters I have availed myself largely 2 of the very interesting reports made to the Royal Commission on tlie Depression of Trade by Her Majesty's representatives in foreign countries. Since the previous editions were written many circumstances have changed. The hybrid. Fair Trade, has, by intercrossing with its parent species, largely reverted to the parent stock, and its defenders have almost dropped the mask by which they at first g attempted to conceal the obnoxious features of Pro- gs tection. The feeling for union with the Colonies has * grown in strength. The depression in trade has .•il)l)737 VI PREFACE. ceased to be a mere oscillation, and has assumed some symptoms of a more chronic character. All these circumstances would have led me, if the matter had been res intcgra, to make the book more logical in its arrangement by stating and explaining the principle of Free Exchange in the first instance, and then giving illustrations of the application of that principle to present circumstances and conditions ; to our relations with our Colonies and with foreign coun- tries ; to our supplies of food ; to the present de- pression ; to the present condition of wages, prices, and profits. But, apart from the time and labour wliich such a recasting of the book would cause, 1 doubt if a total change of arrangement would be welcome to those who already know the book in its former shape, and I have therefore limited myself to the additions mentioned above, and to such other additions and alterations as are called for by change of circumstances. For a revision of the figures I am indebted to Mr. G. J. Stanley, of the Commercial Department of the Board of Trade. T. H. FARRER. Ahingci- Hall, Scptcmbcy, 1886. PREFACE TO THE NEW EDITION. When the late Lord Farrer's * " Free Trade v. Fair Trade " was first published by the Cobden Club in 1881, it carried great weight in the fiscal controversy which was then occupying attention, and new editions were called for, the last appearing in 1887 ; while since the present agitation began it has been in great request by the friends of Free Trade, and is described by Mr. Vince in his pamphlet advo- cating Mr. Chamberlain's proposals, as " the most elaborate statistical defence of free imports." In order to show that its defence of free imports is as valid now as when in 1883 it convinced Mr. Chamberlain, the book has been revised and brought uj) to date. In the revision, I have added new figures and facts, and comments suggested by the events of the eighteen years which have elapsed since the last edition was published, but nothing except a little tabular matter has been omitted. Here and there new tables have been substituted for the old ones, but as a rule the old have been reprinted with additions, both because they were frequently necessary to illustrate the arguments of the author in the text, and because, in conjunction with the later statistics, they afford valuable data for com- parisons between that date and this, which are not else- where easily obtainable. The chapters on the commercial depression throughout the world since 1873 have been left without comment. Though their interest is chiefly historical, because there have been ups and downs of trade since then, the argument founded upon the facts of that time is based on principles just as valid now as when the book was written. * Thomas Henry Farrer, fir.-it Baron Farrer, civil servant, was bom 1819, died 1899 ; was educated at Eton and Oxford, appointed Assistant Secrctaiy to the Marine Department 1S50 ; Joint Assistant Secretary to the Board of Trade 1854 ; I'ermanent Secretary 1865 to 1 886 ; was Vice- Cliairman of the London County Council 1891. VUl PREFACE. In mail}' places Lord Farrer illustrated his own reason- ing, or exemplified that of his opponents, by quotations from contemporary magazines and newspapers. It would have been easy to replace or supplement these with similar extracts of to-day, but so essentially the same are the Protectionist or Fair Trade fallacies of 1903 and 1883, that this seemed to me not only unnecessary but undesirable, since every reader of the book who is acquainted with the latest Protectionist writing can scarcely fail to be struck with the fact that the opponents of Free Trade have learnt nothing and forgotten nothing in the last twenty years. All the additions I have made to the book as last published (with the exception of tabular matter, which is simply brought up to date) are printed in a smaller type than the original, in order that the reader may easily dis- tinguish my work from that of the author, and may follow the thread of his argument without difficulty where the matter is broken up by paragraphs containing com- ment or later figures. The careful study of this book necessitated in re-editing has impressed me more than ever with its fairness, its completeness, and its value in the fiscal controversy, and I hope that the new facts and statistics given in the present edition will bring it to the notice of readers who would otherwise regard it as out of date. In the collection of the statistics and the compilation of the numerous tables which involved the more labour, in that the figures were extracted from a great variety of Blue Books before the Board of Trade's late publication on " British and Foreign Trade and Industrial Conditions " was available, I have received the most valuable assistance from Miss V. I. Chomley, M.A., who is resi:)onsible for the many calculations required in following out the late Lord Farrer's methods of summarising the statistical data. C. H. CHOMLEY. London, October, 1903. CONTENTS. PRELIMINARY. CHAPTER I. lAf.E DlKKICULTY OF KNOWING WHAT iO ANSWER .... I Recognised principles of Free Trade — Vagueness of attacks on these principles — Allegations of national decay — Recent Protectionist utterances. CHAPTER II. Recent Protectionist Utterances — Lord Penzance in the "Nineteenth Century." Mr. IIoworth in the "Times " 3 Protectionists' claim to be practical men — Lord Penzance's " Free Trade Idolatry " — His history — His theory con- cerning imports and exports — True theory — Goods paid for by goods, past or present — His arguments from ex- perience — His misrepresentation of economists — His illus- trations of his theory — French pianos — Bradford woollens — His conclusions — Mr. H. Howorth in the Times — Cheapness versus employment — Taxation of idle consum- ers — Protection and wages. CHAPTER HI. Preliminary Considerations Concerning Foreign Competi- tion ANIJ the way to meet IT — ATTITUDE OF OUR Traders in Face of present Difficulties — Statement OF Questions to he Discussed 17 Alleged demoralisation of manufacture by foreign competi- tion — Josiah Wedgwood and Sir Stafford Northcote iipon this point — Present attitude of our traders towards Ger- many and other rivals — Remedies sought in restrictions on others — Real cause of German success — Reaction against Free Trade principles — Pious opinions — Ques- tions deserving an answer. CHAPTER IV. Proposals of the Fair Trade League 22 Programme of League — Mr. Sampson Lloyd's letters — Mr. Farrer Ecroyd's resolution — The vagueness of proposals of Fair Trade League — Two great principles — i. Encour- agement of colonial trade — 2. Retaliation on foreigners — Assumed national decay — These assumptions answered already — Statistics of condition of England since 1840 (Reference to Table XXVI. in Appendix). X CONTENTS. PART I. -NEW COLONIAL POLICY, CHAPTKR V. PAGE General Character of this Policy 28 A great national policy — Imperialism — Suspicious character of this policy — Present feeling about the colonies — Ex- hibition of colonial manufactures — Imperial and colonial ideals. CHAPTER VI. Assumption that our Colonial Trade is more steadily INCREASING AND LESS FLUCTUATING THAN OUR TrADE WITH Foreign Countries 31 Superior growth and steadiness of colonial trade assumed — Fair Trade allegations of superior growth and profit of colonial trade — Absurdity of their reasoning — Their evi- dence of the alleged fact — Customs Report of 1881 — Customs statement incomplete and misused — Mr. For- ster's speech on Colonial Trade — Exports to colonies and foreign countries since 1840 — Trade with colonies and foreign countries in each of the last 30 years, as a whole — Trade with each foreign country and each colony for each of last 19 3'ears — Exports to each foreign country and each colony for 19 years — Observations on our trade with each foreign country and colony — Ger- many and Holland : Effects of French indemnity : Sugar, and how it is paid for — Belgium — France — Italy — Turkey — Egypt — Ignited States — Brazil — Chili and Peru — China — Japan — British North America — West Indies — Australia — South Africa — India : Circuitous trade of England with the East, America and other foreign coun- tries : ICffects of Suez Canal — Tables of colonial imports and exports — Colonial trade does not increase more or fluctuate less than foreign trade ; the two are intimately connected ; are similar ; and are similarly influenced by many local and temporary causes — Reference to Tables in Appendix as to trade of colonies — Conclusions respect- ing comparison between colonial and foreign trade. CHAPTER VII. Protection in Foreign Countries 75 Assumption that colonies have less tendency to Protection than foreign countries — Returns of duties, 1859 and 1879 — Lord Sandon's return — Rates of duty in foreign coun- tries — Russia — Germany — Holland — Belgium — France — Denmark — Sweden and Norway — Italy — Austro- Hungary — Spain — Portugal — United States. CONTENTS. XI CHAPTER VIII. PAGE Protection in the Colonies 85 Colonial tariffs — New South Wales — Victoria — South Austra- lia — Western Australia — Tasmania — New Zealand — Queensland — Canada — Cape — West Indies — Mauritius — Ceylon — India — Conclusion that Protective tendencies are as strong in ctilonies as in foreign countries. CHAPTER IX. Is A Customs Union of the British Empire possible? . . 93 Assumptions of Fair Traders no ground for new colonial policy — But is a new colonial polic}' desirable on other " grounds? — Customs Union of the British Empire a dream — Self-government involves freedom, and therefore diver- sity of taxation. CHAPTER X. Proposals of the Fair Traders for encouraging Colonial Trade ark Proposals to restrict Trade . . .98 Fair Trade proposals for differential duties in favour of colonies — They are proposals to restrict and diminish trade. CHAPTER XI. Proposed Tax on Food ico Differential Tax on food the keystone of the Fair Trade pro- posals — Where does our imported food come from? — Four-fifths from foreign countries and one-fifth from colonies. CHAPTER XII. Why is a Tax on Food Oi'.jf.cti'inai;i.k ' . . . . 103 Tax on food will raise price of food, but this is not all — I'.ffects of a tax on food — It will raise rents — It will also diminish production here and abroad — Fair Trade answers to this — Inconsistency of these answers — A tax on food will raise its price — Cobden quoted as an author- ity for raising price of food ! — Effect of raising price of food on our wcjrkmen at home and on their expenditure. CTIAl'TKR XiU. Fallacy of supposing that Colonial Markets will com- pensate us 107 Dealings with colonists are not more profitable than dealings with foreigners — The price paid in goods for a quarter of corn sold in England is the price in the English market, and it is tlie same wherever the corn conies from — Con- fusion between individual commercial dealings and Inter- national treaties or arrangements. XU CONTENTS. CHAPTER XIV. PACE Effects of an English Tax on American Corn on American COMPETITION WITH ENGLISH MANUFACTURKS . . . I ID Tax on American agriculture would drive America into manu- facturing competition. CHAPTER XV. Ohiection that we are paying for Americ.\n Corn by RECEIYING BACK. PkINCITAL OF INVESTMENTS . . .112 If America owes us money she must repay, or pay interest, whether we buy her corn or not — Absurdity of supposing that interest on foreign investments supplies luxuries to the rich — Interest on foreign investments comes home as food or raw material — The recent depression has hit the rich and spared the poor — Transfer of trade to colonies will not prevent investments abroad. CHAPTER XVI. Tariff Bargains with the Colonies. Are they possible? ii6 To make such bargains we must first impose duties on our- selves, which is out of the question — But if we did, what should we have to give? — ^What should we get in return? — Recent proposals of Imperialist Reformers — Their ab- surdity — What would the colonies get? — What would they give? — What would be the position of the colonies when the bargain is made? — Ultimate results of such bargains — Any forced attempt at union must lead to disunion. CHAPTER XVII. Commercial Treaties with the Colonies. Are thky possible ? 124 Can we make commercial treaties with colonies, such as the French Treaty? — Narrow limits within which such trea- ties would be applicable — No reason against such treaties in existing Imperial relations, for the self-governing colonies are independent — But are there any duties on colonial produce which we could give up? — Statement of the quantities and values of articles exported from India and the colonies upon which customs duties are levied in this country — Wine, the only article that affords any scope for alteration of duty — We have nothing to give — " Most favoured Nation " clause : Difficulty in applying to colonies. Conclusions of Part I. as to new Colonial Policy . . 131 The English Government can do little or nothing to extend colonial trade — Governments can check but cannot create trade. CONTENTS. XIU PART II. -RETALIATION. CHAPTER XVIII. PAGE Retaliation on Manufactured Goods Absurd . . . 133 English Retaliation on foreign manufactures impotent and suicidal. CHAPTER XIX. Proposal to Ta.\ Manutacturers and leave " Raw- Material" Free — Difficulty of the Distinction . 135 Is the received policy of distinguishing between raw materials and manufactures well founded? — Impossibility of distin- guishing between them — Mr. Sampson Lloyd's letters — New definition of raw material as an article which can- not be produced at home ! CHAPTER XX. Other Proposals for Retaliatio.v 138 Arguments in favour of Retaliation — Lord Salisbury at New- castle in 1881 — -His argument derives its strength from commercial treaties — "X." in the Pall Alall Gazette — More reckless advocates of Retaliation — Misrepresenta- tion of the origin of the policy of fighting hostile tariffs by free imports — Debates of 1843 ^^^ 1844 — Our interest is to abolish our own Protective duties, whether other nations reduce theirs or not — Origin of our present policy. CHAPTER XXI. Hostile Tariffs MUST hk met hy Free Imports. Statement OF THE Principle 145 Fallacies in the arguments of Lord Salisbury and others — Protective tariffs impediments, not barriers — Position of a Free Trade country in the midst of Protectionist coun- tries — FIffect of Protective duties as between two countries only — Effect of Protective duties as between three or more countries — Abstract illustration — Concrete illustration — The nation which remains free will get the largest share of the trade. CHAPTER XXII. First Objection to the Principle— Home Taxation . . 153 Are our producers to be compensated for the taxes they pay? — Mr. Sampson Lloyd's taxed bullock — Taxation should be fair as between different classes — ]5ut foreign producer pays direct taxes no less than ours, and is burdened with heavier charges of other kinds— Compensatory taxation impracticable — The suggestion is absurd in principle. XIV CONTENTS. CHAPTER XXlll. PAGE Second Objection to the Princu'LE— Excess of Imports . iS7 Alleged excess of imports — Fair Trade ploughs, gratis ! — Fair Trade notion that imports injure Englishmen as pro- ducers — Fallacy of distinction between producer and consumer — Largest imports cause largest production — The fear of growing imports — Imperfection of statistics as statement of Balance of Trade — Excess of imports in 1880 and 1884 — Estimate of foreign investments — Out- goings on ships — Cobden's illustration of excess of im- ports and drain of gold. CHAPTER XXIV. Third Objection— Investment OF English Capital Abroad . 163 Fair Trade objections to our foreign investments — Interest of our working men — i. In the imports which are the returns from these investments — 2. In the exports by which the investments are made — Certain advantages to working men — Possible disadvantages to working men — Balance of advantages — Drawbacks to foreign investments. CHAPTER XXV. Fourth Objection— That Free Imports Diminish Home Production and Wages — Can Employment and Wages be Increased by Protection ? 168 Good wages said to be better than cheap goods — Mr. Howorth — Lord Penzance — C'heapness to consumers is not^ as stated, the Free Traders' idol — Theories of wages — High prices do not involve high wages — Presumption that re- striction of production cannot increase wages — Prices may be raised (i) by increasing demand, {2) by diminish- ing supply, which is the Protectionist method. This may raise wages temporarily in one limited trade, but will injure workmen in other trades — Advantage to protected workmen temporary and precarious — Protection cannot stop at one trade. Protection to one article involves Pro- tection to all things made of it. Protection to one class of workmen involves Protection to all other classes — Ex- perience proves this to be true — Illustration from a pro- tected and self-supporting village — Effects on wages and employment of a tax on corn. CHAPTER XXVI. Protection for the Purpose of Checking a Too Exclusive Development oe Agriculture in New Countries . 179 Reasons against Protection in young countries — Special rea- sons against Retaliation in these cases. CONTENTS. XV CHAPTER XXVII. PAGE Protection for the Purpose of Diverting Industry from Agriculture to Manufactures in Ireland . . . i8i Protective duties on English goods proposed — Plausibility of the proposal — What would be the consequences? — Loss to both countries, but especially to Ireland — It would tend to political separation. CHAPTER XXVUI. Illustration of Principle : English Trade uefore i860 . 184 Statistics of English Trade before i860. CHAPTER XXIX. Trade generally since i860 186 Alleged changes of circumstances since i860 — The world not so Protective as it was — Human laws only one factor in the great result. CHAPTl'.R XXX. What Ekee Trade means, and what it cannot do . . 188 Free Trade cannot create ; it can only leave Nature and man free — True test of Free Trade. CHAPTER XXXI. Relation of the Prosperity of other N.\tions to our own 189 Our trade can only grow bj^ making the trade of other nations grow too — Folly of supposing our wealth to consist in the poverty of others — Competition. CHAPTER XXXII. Comparison of Statistics of Trade of Different Nations. 191 Comparison with other nations — Increase of our trade means increase of foreigner's trade — Manufactures the thing for us to compare — Our statistics of export do not include freight — W'e cannot keep all manufactures — We supple- ment trade which we lose bj' new inventions — Distinction between food, raw materials, and manufactures. Its necessary inaccuracy. CHAPTER XXXIII. Foreign Trade of United Kingdom since i860 . . 195 Statistics — Effect of foreign trade in feeding increased popu- lation — Sir J. Caird's estimate — Exports of the United Kingdom in 1870, 1880, and 1884, analysed into food, raw materials, and manufactures. XVI CONTENTS. CHAPTER XXXIV. page Foreign Trade ok France 199 Statistics — Comparison with English trade — Imports and ex- ports from and to France before and since treaty — Exports from France in 1869 and 1879 — Duties imposed by France on articles used in manufacture. CHAPTER XXXV. German Trade in Recent Years . . . . . . 203 Official reports full of interest and warning — History of Ger- man trade — Statistics of German trade — Depression in Germany — Advance of German trade and its causes — What has Protection done for it? — If it has fostered some industries it has impeded others — It has made things dear to consumers in Germany — It has raised prices, but has not raised profits, which are in many cases next to nothing — Goods are sold cheap abroad and dear at home — Agri- culture extremely depressed — Tax on corn — Conclusions concerning German trade. CHAPTER XXXVI. Foreign Trade ov the United States 226 Statistics since 1854 — Exports in 1870 and 1880 analysed — Causes of United States prosperity — Nature of their exports. CHAPTER XXXVII. Trade of Canada and Australia 235 Trade of Canada since new Canadian tariff — Comparison of growth of trade, etc., in Victoria and New South Wales. CHAPTER XXXVIII. Agricultural Depression; Ei-fect ov Bad Harvests . . 241 Sir J. Caird's estimate of the losses of the landed interests — Losses of farmers due to four causes: i, Rise of rents; 2, Rise of wages ; 3, Lowered prices ; 4, Deficient produc- tion — First three a loss to the landed interest, not to the whole community — What is the effect of deficient harvests on entire community? CHAPTER XXXIX. Commercial Depression suhsequent to 1873 .... 245 Burden of proof lies on those who call for change of our policy — Commercial depression subsequent to 1873 — Exaggera- tion of prosperity of 1872-73 — Statistics founded on price misleading — Prices of raw material — Temporary causes of inflation — Large exports and high prices not necessarily tests of prosperity — Appreciation of gold — Change in mode of doing business. CONTENTS. XVU CHAPTER XL. page Depression at the Present Moment at Home . . . 250 Since 1880 there has been revival and subsequent depression — Causes : i, Agricultural depression continued ; 2, Boom and subsequent collapse in shipping ; 3, Boom and col lapse in United States railways; 4, Consequent reviva and subsequent depression in iron trade ; 5, Glut of corn 6, Wars and Protective tariffs — Extent of depression Statistics for 1879 to 1884 of trade — Shipping — Railway — Production of coal and iron — Cotton — Wool — Consump tion of sugar, tea, etc. — Pauperism — Savings Banks. CHAPTER XLI. I'RESENT COMMKKCIAI, DEGRESSION IN FRANCE .... 258 Depression greater in France than in England — Paris trade — Lyons trade — Agriculture — Causes of depression. CHAPTER XLH. Present Commercial Depression in the United States . 261 Depression in the United States — Mr. Forwood — Mr. McCul- loch's Report on the glut in manufactures in the United States — Agriculture in the United States — Railways in the United States — Bankruptcies in the United States and in England — Clearing House business in the United States and in England — Emigration to the United States — Em- ployment of labour in United States — Bradstreefs inquiry and report — General reduction in wages- — Employment of labour — Protected industries have suffered most — Steel and iron have suffered most of all — Report by Sir L. West. CHAPTER XLHL Present Commercial Dfpre.ssion in Russia .... 274 All branches of trade and agriculture much depressed — Her natural wealth is agriculture — She has starved this and fostered sickly manufactures. CHAPTER XLIV. Present Commercial Depression in Belgium .... 276 Report of Mr. Fane — Recent course of trade in Belgium — Production, profits, and wages in coal-mining — Causes of depression — i'rices, profits, and wages in Belgium — No resuscitation of Protection in Belgium — M. Pirmez on Protectionists. CHAPTER XLV. General Remarks on the Present Commercial Depression 280 One general feature of the present depression is over-produc- tion or glut — Effect of Protection in increasing glut — This causes general loss and suffering — This one cause of de- pression is human and preventible — It is probably the XVlll CONTENTS. PAGH effect of trying to. imitate England by non-natural means — General character and causes of depression — Some causes temporary, some more permanent — Temporary causes — More permanent causes. CHAPTKR XLVI. SmrPiNG 286 Shipping of the United Kingdom — French shipping — United States shipping — luirly promise of United States shipping — De Tocqueville's prophecy — I'resent state of American as compared with Hritish shipping — Shipping as com- pared with railway interest — Present depression. ClIAPTKR XT.VIT. Special Instances of the Effects of Free Trade and of Protective Duties on Production — Leather, Salt, Silk, Clocks, Woollens, Steel Rails, Copter, Biscuits, Wire, AND Jute 295 Leather, increase of manufactures of — Free importation of foreign hides— Leather, tanning and manufactures of — Salt, French duty on — Silk ; l'"rench duty on cotton yarns ■ — Clocks in England and United States — Woollens in United States — Steel rails in United States — Copper in United States — Biscuits — Wire — Jute. CHAPTER XLVIIL Sugar 315 Importance of sugar politically and economically — I'-normous and increasing supply — The supply is both of cane and beet sugar — Raised in all countries and climates — l'".ng- land's share as compared with other countries — Share of the United States, France, and Germany — It is food — It gives employment — It is also raw material — These results obtained by free importation — Taxation on sugar — Draw- back on exportation — Difficulties of European Govern- ments — Reduction and final repeal in lingland of sugar duties — Results — German tax and drawback — Austro- Hungary — l'"rance — Belgium — Holland — Russia — United States — Brazil — New Zealand — General action of Foreign Governments — Imports of sugar from, and ex- ports of manufactures to Germany, Holland, and Belgium — Importunities of sugar refiners and West Indian planters — Refiners' case — Case of West Indian planters — Causes of growth of beet sugar — Restriction of the market impossible — Is cane being supplanted by beet? — Planters' interest and colonial interest not identical — West Indian sugar a comparatively small interest — Tliey have no case for change of our fiscal system — Remedies suggested — What are bounties? — What are the Retaliatory duties to be? — "Most favoured Nation" clause — Bad effect of Re- taliation abroad — Effect of duty on price — Conclusion as to sugar. CONTENTS. XIX CHAPTER XLIX. iage CONSEijUENCKS OF RETALIATION, IF PRACTICABLE . . . 339 Englishmen must buy dearer and worse goods — Sale of English goods would be diminished — Materials would be scarcer and dearer — We should lose the stimulus of com- petition — Last state of protected interests worse than the first — Confusion at the Custom House — Expenses of col- lection — Political degradation — I'rotection begun for Re- taliation will not stop there. CHAPTER L. Rrtai.iation on I'REXcii Silks and Frenxii Wines . . 345 Retaliation in the case of silk — Silk would be worse and dearer in England — l-^nglish dressmakers will be injured — Fewer English goods will be made and sold in exchange — Silk manufacture in l-'.ngland will not be stimulated by com- petition — A weak manufacture will be fostered — And this weak interest will hereafter be deserted — The Custom House will have to distinguish the country of origin of all imported silk — Retaliation on wine. CHAPTER I.I. Retaliation doks not only not ei fect its Object, kut has a Contrary Effect 349 Retaliation will provoke Retaliation — It shows mistrust in our own principles — It arouses antagonism — Strength of pro- tected interests — Experience in France — Recent French duties on animals and corn — I^xperience in Germany, Canada, Russia, and the United States — Protectionist countries get no better terms than we do — Failure of early Reciprocity negotiations — Dr. Franklin — I'nited States and Canada Reciprocity Treat)' — Alleged instances of successful Retaliation — Spain and Germany — United States and Cuba and Porto Rico. CHAl'TKR 1. 11. The French Treaty of i860 358 Cobden's Treaty gives no countenance to Retaliation— We did nothing we should not have done without a Treaty — Wine the sole exception, if an exception — Cobden's Treaty not to be judged by economical results alone — " Most favoured Nation " clause — Actual consequences of the Treaties — Result of Treaties on action of foreign nations not altogether successful — Cobden's views — Real objec- tion to the Treaties that they lead to Retaliation. XX CONTENTS. I'AGE Conclusions or 1'art II. .\s to Retaliation .... 362 Retaliation is, i. Impotent. 2. Uncalled for. 3. Mischievous — Summary of Free Trade doctrine — Each man knows how to buy and sell better than his (iovernment — Everj^ one who buys sells at the same time — Buying and selling between different countries do not differ from buying and selling at home. Final Conclusions 363 New Colonial policy. Object may be good : Means are bad — Governments can check but not create trade — Retalia- tion bad in spirit as in effect^IIopeful tendencies. Appendix, with Tables of Statistics ....... 375 For list and description of these Tables see Appendix . . 375 Free Trade u. Fair Trade. PRELIMINARY. CHAPTER I. DIFFICULTY OF KNOWING WHAT TO ANSWER. When I was asked in 1880 by the president of the Cobden p^^°f"'^^'^ Club to write something in defence of Free Trade, it seemed ""'^'P*^^- to me — recollecting as I did the instruction in politics which I had received from the Corn Law Controversy — as if I liad been asked to prove Euclid, or give a reason for the rules of Grammar. That Governments can by protective or pro- hibitory duties prevent and diminish, but cannot create or increase trade ; that every tax on trade is a diminution of the produce of industry, felt most certainly and probably most severely by the country which imposes it ; that it is just as unwise and unrighteous to prevent the number of men who make up a nation from buying their food and their clothes where they can get them iDCst and cheapest as it would be to compel me to buy my bread from the nearest farmer or my coat from the nearest tailor ; that a law which prevents the people of England from buying in France or America is in no essential resjiect different from a law which prevents the people of Middlesex from buying in Surrey or Lancashire ; that every innocent operation of trade is necessarily an advantage to both parties con- cerned in it, and that to stop it by law is necessarily an evil to both ; — all these, with the numerous consequences derived from them, appeared to me to be such elementary truths that I did not know where to begin. B FREE TRADE V. FAIR TRADE. Vagueness ot Attacks on these Principles. Attacks on Free Trade Principles. Allegations of National decay. Recent Protection- ist utter- ances. Nor did I find much help when I looked into the public speeches and articles of Protectionists, Fair Traders, and Reciprocitarians. Loud assertions that the British work- man is disgusted with Free Trade, and a convert to Pro- tection ; appeals to the prejudices and self-interest of special classes ; allegations of national ruin, which everyone knows to be false ; misstatements of historical facts which have happened within my own recollection ; suggestions of the superior wisdom of Prince Bismarck or M. Thiers ; imagin- ations of the grand imperial policy w^hich Mr. Pitt or Mr. Huskisson would have followed had they been in the place of Sir R. Peel and Mr. Cobden ; attacks on Cos- mopolitanism and praise of Imperialism ; denunciations of political economy, in which the ignorance of the writers was as conspicuous as the violence of their language ; and general philippics against Radicals, Philosophers, and members of the Cobden Club ; — in all this I could find little to answer, though much to grieve at. As to evidence of facts, I could find little or none. Appeals indeed there have been — e.g. in the Quarterly* — from the general experience which is conveyed by the National statistics, to special cases, and appeals of this kind have latterly gained strength from the depression which undoubtedly exists at this moment in many important branches of trade. To this depression and its causes I shall refer in subsequent chapters. There has also, since the date of my first edition, been an abundance of writing and speaking — to be found partly in the publications of the Fair Trade League, partly in newspapers and periodicals — in support of Fair Trade principles. One thing is clear from them — viz. that Fair Trade and Protection are the same thing, and that the })olicy and arguments of Fair Traders are those which we fondly hoped had been silenced for ever in 1846. I find in these papers abundant attempts to show in one form or another that Governments can divert trade without restricting it ; that they can forcibly transfer purchases from one country to another without raising prices ; and that they can raise the price paid to the seller without raising the price paid by the buyer. I find, also, a * Quarterly, 7th October, 1881. PRELIMINARY. 3 constant use of statistics, which, from one cause or another, is insufficient, incomplete, or misleading. To quote or reply to all these statements in detail would be tedious, if prac- ticable, but I trust that I shall be found to have omitted no argument which is of real or general importance. In no essential do the facts of to-day differ from those of 1 88 1, when Lord Farrer wrote. The commercial depression which he treated in detail has long since passed away, but disorganisation of business and a certain amount of temporary distress caused by the late Boer War are doubtless factors which have their weight in enabling Mr. Chamberlain and other Protectionists to find listeners when they revive once more the old cjuack fiscal remedies. And yet Germany, where Protection is in full force, has just passed through four years of the most acute depression, accompanied by an increase of ;^5o,ooo,ooo per year in the value of its exports. It is true that imperial necessities are urged by Mr. Chamberlain as reasons for his campaign. He declares that unless England taxes herself for the benefit of the Colonies the Empire must break up. But for this statement he produces no evidence, and it is practically disregarded by his followers, who write and speak the old fallacies, and misuse the latest statistics in precisely the same fashion as those to whom " Free Trade v. Fair Trade " Veferred in the 'eighties. CHAPTER 11. RECENT PROTECTIONIST UTTERANCES — LORD PENZANCE IN THE " NINETEENTH CENTURY " — MR. HOWORTH IN THE " TIMES." Lord Penzance. It may be worth while, however, to notice one or two Protection- recent Protectionist utterances, if for the mere purpose of ists claim to showing how little new can be said on that side of the ticai nien.'^'" question. Indeed, the gentlemen who now assume to instruct the public in Protectionist doctrines make a very curious impression on those of us who remember how this controversy was sifted out in the old Peel times. Their FREE TRADE 7'. FAIR TRADE. Lord Pen- zance's " Free Trade Idolatry." favourite jilan is to set up some luaxini or generalisation of the economists — often incorrectly or incomi)letely stated — without mastering either the reasons on which it was founded or the history of its adoption in practice. They then attack the writers and statesmen who have advocated and adopted Free Trade, as slaves to a formula, as upholders of theories and contemners of facts, as beating the " ever- lasting tom-tom of Free Trade." etc., and they claim to themselves the credit of being wise, j^ractical men, whose mission it is to set right all this theoretical nonsense. They remind one of a clever schoolboy who, on being in- structed for the first time in the law of gravitation, should say : "Is this really so ? May not Sir Isaac Newton have been mistaken ? Can one material body act at a distance on another material body ? Do not trees grow upwards ? Does not water rise in a sponge ? Can it be possible that all bodies attract one another in this specific way ? May not the whole doctrine be a delusion ? " To all of which the teacher's answer would be : " Don't be quite so clever, and take a little more pains. Learn what Sir Isaac Newton really said and what he proved before you show your cleverness by taking objections. Be the more careful since what is with you only perverse ingenuity may become mischievous in the hands of self-interest and pre- judice." For instance, there are two articles of some pretence by a distinguished lawyer in the Nineteenth Century of March and April last, the title of which — viz. "The Free Trade Idolatry" — is a sufficient intimation of the point of view from which they are written. In these articles Lord Penzance begins by saying that he refers throughout to the Cobdcn Club pamphlets. He can scarcely have read mine ; or, if he has, he has not understood it — which may be mj^ fault. He has certainly not answered it. But I am consoled, for he has paid at least as little attention to a much more important source of knowledge — viz. the history of the great controversies from 1844 to 1849, ^y which the Free Trade policy was established. He starts his argument with the assertion that the promoters of Free Trade were more sangume of its general adoption by all nations than the event has justified. This assertion is true. But when PKELIMINARY. 5 he goes on to state that " upon this conviction the whole fabric of the new system rested : " and that " our present system of Free Imports is not the thing the national judg- ment approved when the Corn Laws were repealed," he is stating what is not the fact, and what he might have known not to be the fact if he had read the controversies of 1844 and the following years, and especially the great debates of 1843, 1844, and 1849.* ^ rieed. not anticipate what I shall have to say on this point in Chapters XX. and LI. of this work. It is sufficient here to state that the principle on which the economists and statesmen of those days acted and professed to act was the principle that " whether foreign nations maintain their own duties or not, it is for our interest to abolish ours." So much for Lord Penzance's history ; now for his theory. He opens this with the well-worn allegation that in con- Lord suming foreign goods the people of this country withdraw l^^eo^rTdz! their demand for goods of English origin and thus injure that ini- the home producer, whilst the home consumer, he admits, V°'^^f ^""^ and the home consumer alone, is benefited by increased dem^or'ex- cheapness. m ■•••>) pons! The doctrine of Free Imports, he says, settles the question in favour of the consumer, and against the pro- ducer, and he then notices, for the purpose of confuting it, the Free Trade argument, that imports necessitate exports, and thus benefit some class of home producers, as well as consumers. And the following is what he supposes to be a confutation. First of all he says that the purchases of each nation from the other are caused not by any calculation of the balance of goods exported and imported, but by the desires of the individuals of each nation for the goods of the other nation. This statement is true so far as it goes, but it is nihil ad rem, and it requires to be completed by adding the words " and such purchases are limited by their ability to pay for them " — an addition which might possibly have led Lord Penzance to sounder conclusions. He then makes the new and wonderful discovery that our im])orts exceed our exports, and after quoting Mr. Mongredien, to show that this excess arises from the interest * See Hansiinl, vol. 68 of 1843, v^'- 73 °^ '844, anil vol. io5 of 1849. b FREE TRADE V. FAIR TRADE. due to us on our foreign investments, and other similar causes, thinks that he has scored a point by showing that, in addition to payments for goods exported in this 3'ear, we are also receiving in our imports payment for goods ex- ported years ago, in the shape of interest on the money due for those goods. He thinks he has scored a further point in showing that, taking a series of years, there is a con- siderable fluctuation in the relation between imports and exports, so that the goods exported in any one year bear no fixed relation to the imports of that j-ear. He then makes the further notable discovery that there are large and complicated balances between different nations, which are settled in some unexplained manner by the transfer of securities and in other ways. He asserts that the foreigner is paid for the goods that he sells us in money ; but is apparently puzzled to know how it is that the foreigner gets his money, since we do not export money. In fact, he leaves the whole subject of international clearance of accounts in a dense haze. Out of this haze, however, he extracts the conclusion that we do not pay for our imports with exports, but in some other manner ; and that the process, whilst it gives our consumers cheap goods, leaves our poor producers to be victimised by the foreign importer, and on the balance makes us poorer. Let us try and clear up Lord Penzance's haze. In the first place I will make him a present of the opinion that, if we are paying for our excess of imports by undertaking obligations to pay for them in the future — i.e. by running into debt — or if we are paying for them by re-transferring or cancelling the obligations under which the foreigner has now to pay interest to us, we are impoverishing ourselves and living on our capital. But it is notorious that the con- trary is the case. We are lending to foreign nations and to our Colonies ; we are extending our shij^ping and our in- visible exports ; we are, in the long run, 3'car b}? year increasing our excess of imports ; we are laying the world under tribute to us. We are clearly not running into debt for our imports, and we are not losing our capital. Under these circumstances I will ask Lord Penzance to consider a little more carefully how our imports are really paid for — how only they can be paid for. When he says that the PRELIMINARY. foreign importer is paid in the first instance in monej', he is stating a half-truth, which leads to a complete misappre- hension, and which conceals the real nature of the trans- action. No money passes. The foreigner who sells goods to us is paid in an order for money, which he never con- verts into money. He uses it as an order for further com- modities, and exchanges it accordingly. Whether he buys goods to be consumed by himself, or labour or services to be converted into commodities, or invests it, it is equally an order for certain goods and services ; and it is these goods or services for which he really exchanges the goods which he sells to us. Whether what he buys are goods in the present, or in the future ; whether they are goods made in our country, or goods made elsewhere to be exchanged for goods made in our country, or to be otherwise more circuitously exchanged, makes no difference. The real transaction is an exchange of goods or services, for goods or services. What is true of the single trader is true of the aggregate imports of the country. They are not given to us. How then are they paid for ? How alone can they be paid for ? Not with gold, for we do not export gold. Not by a trans- fer of securities, for, as we shall see below, we are on this balance investing abroad largely. They can only be paid and accounted for in two ways. First, by the goods which we now export to pay for them ; or, secondly, as a means of receiving and settling the interest due to us on foreign debts. But how were these foreign debts incurred ? By the export of British goods or services in past years, and in no other way. Therefore goods imported to pay in- terest are really imported in exchange for goods or services which have been exported, and which constituted the material form in which the loans were made. Every tyro in economics knows that export and import statistics are very rough and imperfect forms of account, and that they can never be made to balance accurately. But so far as fluctuations in them are due to sending capital abroad for investment, and to receiving interest on that capital, these fluctuations are mere matters of account which would puzzle no business man, though they have left the acute- minded lawyer in a state of complete mystification. But it may be said, and is said by some Fair Traders, Goods are paid for by goods, past or present. 8 FREE TRADE V. FAIR TRADE. " These exports for investment, of which you speak, arc things of the past ; we have had the benefit of them : all that is happening now is the receipt of interest upon them. This comes in the shape of imports, which are, so to speak, gratuitous, and are therefore, so far as our producers ai"e concerned, a pure evil." In fact, so runs this precious argument, we are the less well off because the world owes a large debt to us, which it pays principally in the form of food and raw materials. We are, then, the poorer be- cause we get corn from America, India, and Australia in payment of debts which have been created by past exports of our own manufactures ! I do not attribute any such folly as this to Lord Pen- zance, but it seems to me the logical consequence of the doctrine that imports not immediately paid for by exports are an evil to the country. But are our foreign investments things of the past ? Are we not still continuing to lend and to export our loans in the form of British goods and British services ? Let us see in the rough how, according to the best statisticians, the account stands. The present excess of our imports over exports, as shown in the Board of Trade statistics, was £125,000,000 in 1880 and ;^g4,ooo,ooo in 1884. Of this not less than £50,000,000 is probably pay- ment for what Mr. Giffen calls " invisible exports," viz. freights and profits earned by British shipping, which, though they do not appear in the official trade statistics, are just as much the produce of British industr}^ as our cottons or our hardware. This would leave £75,000,000 in 1880, or £44,000,000 in 1884, to pay for interest on foreign investments. But this interest, no doubt, amounts to a much larger sum — probably to 100 or 125 millions ; and consequently not only is our excess of imports accounted for, but there is, after allowing for the excess of our imports over our exports, a large surplus of the produce of British labour which we export as the material representative of the loans we are still making to foreign countries, and for which those countries will hereafter have to jmy us interest in the form of imi)orts. The excess of imports over exports for 1902 was ;^ 1 7 9, 000, 000, Init the contention that in spite of receiving tliis very large surplus the PKliLlMlNAKY. 9 United Kingdom is entitled to a greater excess .-.till which is re- invested abroad, finds striking confirmation from the Protectionist, economist of the Daily Telegraph, who submits the following : — National Balance SifEET for 190J. Exports of Home Produce ;{;283, 000,003 Re-exports of Foreign and Coluiiial Produce .. .. .. .. ;{^66,ooo,ooo Invisible Exports (freights and income from investments) .. .. ;Ci9o,ooo,coo Total ;{;539,ooo,ooo Deduct total imports ;{;528,8o;,ood Balance ^10,200,000 This is the balance as shown in the Telegraph publication, " Imperial Reciprocity." It was ;^5, 000,000 larger a few weeks previously, when the articles — of which this book is a reprint — appeared ; but since that time the writer has probably discovered that the balance shown by him cannot possibly be anything else than annual profit made by England in her foreign trade — a balance annually owing to us, though not received, but re-invested abroad. Hence his anxiety to lake /^5, 000,000 off" it is not unnatural. The ;f 190,000,000 of invisible exports sh iwn in this balance sheet is made up of /^i20,ooo,ooo estimated income on foreign investments and /^ 70,000,000 the earnings of IJritish shipping. According to the latest Board of Trade return the earnings of British shipping probably amount to ^90,000, 000, in which case the annual balance re-invested abroad would amount to ^^30,000,000. And yet, such is the hopeless confusion of thought to which Protectionists are subject, the very article in which this balance sheet appears expresses the fear that we are spending all the interest on our savings of the past and living on our capital, though the writer has clearly demonstrated that, assuming his own figures to be correct, we are annually adding a large sum to our savings instead of drawing upon them. Taking these facts into consideration, there is nothing whatever in the fluctuations of statistics to disprove the elementary proposition that trade is exchange, and that our imi)orts are jKiid for by our exports ; that imports involve exports, and vice versa ; and that anything which limits im]wrts must also limit exports. It is surely the " bottom " of Lord Penzance's argument, and not the bottom of the Free Trade argument, which tumbles out. Having disposed, as he thinks, of this theory of Free Traders, Lord Penzance proceeds to demolish their 10 FREE TRADE V. FAIR TRADE. Lord Penzance's argument from expe- rience. Lord Penzance's misrepre- sentations of Econo- mists' views. argument from experience, by attempting to show that our recent prosperity is due in a great measure to other causes, and that nations which have not adopted Free Trade have mado as great progress as we have. Into this I do not care to follow him, especially since I have dealt with these questions in subsequent chapters. The question is not whether Free Trade is the sole cause of commercial prosperity, but whether we in England do better with it or without it ; and I believe that, if Lord Penzance will but pursue the economical studies he has so happily commenced, he will find that the ablest Free Traders — such as Mr. Fawcett and Mr. Gladstone — are as decided as he can be in condemning the short-sighted fanaticism which has too often treated our Free Trade policy as the sole factor of our commercial prosperity. Having thus satisfied himself that, in theory and ex- perience, the Free Trade argument fails, Lord Penzance recurs to his notion that cheapness to the consumer is the sole benefit to be derived from Free Imports ; that cheap- ness is important in some cases, such as food and raw materials, but not in others, such as goods consumed by the wealthy ; that employment is more important than cheapness ; that cheapness may destroy employment, and that the Legislature ought to set itself the task of con- sidering in the case of each particular article whether the community gains more by the cheapness of the foreign article than it loses by ousting the home producer from its market, and that it should fix its Custom Duties accord- ingly. A nice task for the Legislature ! and a pleasant substitute for the self-acting rule which, if the Free Traders are rght, produces not only cheapness to the consumer, but the maximum of profitable employment to the producer ! In the course of this argument Lord Penzance, having in the previous paragraph upheld the supreme importance of cheap food, proceeds in the next to upbraid the Free Traders for asserting that the distress of the earlier part of this century was owing to dear bread, and throws in their teeth that the comparative prosperity of subsequent years was due, not to cheaper corn, but to more remuner- ative employment. But this is exactly what Cobden pre- dicted as the result of rei)ealing the Corn Laws, and the PRELIMINARY. 11 complete fulfilment of that prediction is one of the strongest proofs of the truth of Cobden's theories. It is perhaps not surprising that so young a student of economy as Lord Penzance should have imagined that " cheapness to the consumer " is the one end and aim which Free Traders have proposed to themselves. But I can assure him that, when he has read a little more, and more carefully, he will find that this is a vain imagination. What the earlier economists aimed at, what modern Free Traders desire, is not cheapness, but abundance — abund- ance of production, abundance of employment, abundance of consumption. Abundance is often shown by cheapness, but not necessarily so. Abundance may be consistent with high prices, full employment, and high wages. What Free Traders contend is, that the maximum of production, and of employment which is necessary to production, is to be obtained by allowing everyone to produce, sell, and buy as his own interest dictates ; that any interference with this freedom is a restriction not only on consumption, but on production ; and that any such restriction must diminish the aggregate production and employment, as well as the consumption, of the country. But there is no test of an argument so good as the cases Lord by which the author himself illustrates his position. Let nUisiraUons us take the two illustrations which Lord Penzance gives us. of his His first is the case of a piano. He assumes that it can theory, be made in England at £30, and in France for ^27. " The French gain," he says, " to the consumer by buying the foreign piano, article would be ;^3." But assum'ng one-half the price to be wages, " there would," he says, " be £1^ or £14 lost to the British workman against the £3 gained by the con- sumer," and he leaves us to conclude that England loses £10 by the transaction. Now, will Lord Penzance be kind enough to inform us whether the French pianoforte maker makes us a present of his piano, and if not, in what way he is paid ? " In money or in securities," Lord Penzance will say. But we do not on the balance export either money or securities, and it cannot, therefore, be in that fo m that we pay for foreign goods. The French piano can only be paid for in goods — in something which some Frenchman wants more 12 FREE TliADE I'. FAIR TRADE. than the piano — and which he can get cheaper by ini{)oi"t- ing it into France, just as the Enghshman gets the piano cheaper by importing it into England. This something may be an article made in England, or an article made in India, and exchanged in the course of trade for an article made in England and exported to India ; or the process may be more circuitous still. But in the end it resolves itself into an English want for a French article, satisfied by a corresponding foreign want, direct or indirect, for an English article. And the beneficent laws of trade, if let alone by human folly, provide that in satisfying these wants, each man. Frenchman, Englishman, Indian, or other, makes that thing which he can make best and cheapest. Bradford Lord Pcnzance's second case is that of woollen goods, Woollens. ^^ which, as is well known, a change of taste or fashion some years since caused a transfer of custom from Bradford to the French manufacturers — and Lord Penzance thinks it might well have been discussed whether it was not well to raise a part of the public revenue by a tax on these French goods. " The worst," he said emphatically, " that could be said against it would have been that the French goods would have been increased to tliis consumer by the extent of the duty." — No ; that is not the worst which could be said against it. The desire of the English ladies for the French woollen goods could only be satisfied by sending something from England to France which the French desired more than their woollen goods, and which ex hypothesi England could make more successfully than she could then make woollen goods ; and this manufacture as well as the French manufacture would have been stopped or restricted by this tax. As a matter of fact, I believe that what happened under a free regime was that the Bradford manufacturers improved their machinery and thereby re-established their trade, a result which would probably not have happened if they had been protected. I join with Loi^d Penzance in dejnecating foolish changes of fashion and the evils they inflict on trade ; but if the Government is to undertake the task of regulating human desires by checking the caprices of fashion, it will have a hard time of it. PRELIMINARY. I3 I tliink I liave now disposed of Lord Penzance's history, i^o'd his theory, and his ilhistrations. Let us now consider his condu^ioifs conclusions, which are somewhat hazy. He seems to in- cHne to the Fair Trade programme which I discuss below, but the final result of his lucubrations is formulated by him in the following five propositions, viz. : — " I. That the question of duly or no duty on any import is a separate question for each import and cannot he determined by any general rule. " 2. That no duty should be imposed save for purpose of revenue. "3. That in selecting the articles on which duties should be imposed, it is advantageous to the community, cceleris paribus, that the duty should fall on any article in which the foreigner competes with the labuur and skill of our own people. "4. That it may be desirable, if practicable, so to regulate our tariff as to favour the productions of our Colonies and Dependencies in comparison with those of foreign countries. "5. That the rule prohibiting the imposition of a duty on any foreign article, the like of which is produced at home, which now goes by the name of Free Trade, has no good reason for its support, was only adopted by this country as one part of that system of free and unfettered interchange of commodities which it offered to the rest of the world ; an offer which, after the lapse of forty years, has never been accepted, and a system in con- sequence which never existed." Considering the interest Lord Penzance has taken in a subject with which he is obviously unfamiliar, I am not without hopes that, if he continues his studies with the same zeal with which he has commenced them, he will eventually agree with mc in coming to the following con- clusions concerning his five propositions, viz. : — The first of them, which deprecates any rule, is inconsistent with the .second, third, and fourth, which propose rules. The second, which makes revenue the sole object, is inconsistent with the third, which makes Protection the object. In proportion as a duty succeeds in I'rotection, it destroys revenue. The third is simple Protection, and if adopted for manufactures, cannot be withheld from food and other articles. The fourth is impracticable, as I have shown below. The tilth is wrong in point of argument, and as a matter of fact and history is incorrect.* * LorJ Penz.ince's reply to Mr. Medley, in the September number of the Xinetecnth Century, is rather disappoiiuing. His lordship's progress in his economical studies would prob.ably be grciter if his tone and temper were less confident and more judicial. He seems now to have got the length of understanding that we do pay value for our imports, and to think that we do so by exiiorting securities, and thus cancebing debts which our Colonies and foreign countries owe us. Further study will probably teach him that this cannot be the case, because we are increasing our investments abro.id, and our imports coi.tinuc to increase. Rut it is something for so young a student to have found cut th it foreigners and Colonists do not give us their produce for nothing. In time, no doubt, he will realise the fact that we have paid, or are paying, them with produce of our own, and that the more they send, and the less we pay, the better the bargain for us. 14 FREE TKADE V. FAIR TRADE. Mr. Henry Howorth in the Times. Cheapness Mr. Hoivorth. Then comes Mr. Henry H. Howorth, who writes as the present Coryphasus of Protection, in the town which was formerly the cradle of Free Trade. The most remarkable fact about his lively chatter ("a flood of inconsequent rhetoric," is the term he uses himself concerning his most distinguished oj)ponent) is that it has been allowed to fill nearly twelve feet in length of the valuable columns of the Times. His great discovery (I quote his owni corrected versus Em- statement of his argument from the Times of January 7th, pojment. -j-gg^j jg^ "that dear commodities with employment are better than cheap ones with no wages to buy them with ; and that commodities may be too cheap when they are cheaper than our people can make them profitably." If this means that a workman who now earns 5s. a day, and who spends that sum on necessaries, will be worse off if his wages are reduced to 2s. and the cost of what he buys is reduced to 3s., it did not need six columns of close print in the Times to prove so self-evident a proposition. But for the purposes of Mr. Howorth's conclusions, which appear to be that we ought to exclude from this country all foreign goods which can be produced at a greater cost at home, the proposition is as worthless as it is self-evident. To make his argument of any value, he would have to prove that by creating an artificial scarcity it is possible to create not only a general rise in prices, but a general demand for labour, a general increase of employment, and a general rise in wages still greater than the rise in prices. To state such an argument plainly is to prove its absurdity. General plenty cannot be caused by general scarcity. It is in the power of a Government to create scarcity. But to produce plenty by creating scarcity is beyond the power of any Government. Mr. Howorth does not condescend to tell us what are the foreign articles he would exclude, but his principle, if good for anything, extends to all things which are, or can be, produced at home, but which are produced cheaper abroad. Food is one of these articles. Create a scarcity by excluding foreign food, and, says Mr. Howorth, the general demand for labour and real wages will rise in a PRELIMINARY. I5 still higher proportion than the price of food. Such is the result of Mr. Howorth's six columns in the Times. I once used to visit a remote rural village in the Mid- lands in which the general shop was kept by an old retired servant. For years she played a useful part in supplying the villagers with necessaries and little luxuries. She kept herself, and she employed a girl or two to attend to the business. In the course of time the shopkeepers in the neighbouring to^vns discovered that there was a vein of custom to be tapped in the surrounding villages ; they sent round their carts and supplied the villagers with necessaries and luxuries, better, fresher, cheaper, and more varied than could be got at the poor old woman's shop. Her custom declined ; her girls were dismissed ; and at last her shop was shut up. Loud were her laments when- ever we went to see her. The world was going wrong — and it was " all along of them 'orrid carts." Mr. Howorth and his friends do little more than repeat, with varied emphasis, " Out on them 'orrid carts ! " I need not follow Mr. Howorth into the distinction Taxation which he draws between producers, who sell, and con- of^i'econ- sequently desire to have things dear ; and consumers, who buy, and consequently desire to have things cheap ; as if we were not all of us, except the purely idle, both con- sumers and producers, and as if producers as well as con- sumers were not benefited by being able to buy and to sell when and where we find it most profitable. Nor need I follow him in his attack on capitalists, who, as he says, live on what they have got and who wash to buy cheap ; as if capital were not, as Sir L. Mallet has pointed out, the fruit of past labour, and as if the owner of invested capital was not as eager for high prices and large profits as the poorest labourer he emi)loys. If, however, Mr. Howorth wishes to tax capital because it is idle, and be- cause its earnings are spent on luxuries, I would suggest to him that there is a way in which he can accomplish his object far more effectually and universally than by interfering with imported manufactures. Let him join the Radicals in imi)osing a graduated income tax, or some other similar form of direct taxation, and he will tap capital at the fountain-head. l6 FREE TRADE V. FAIR TRADE. Nor need 1 make a detailed examination of Mr. Howorth's wonderful doctrines on the subject of foreign investments. " English capital," he says, " is well and patriotically invested abroad when it is employed in pro- ducing there what we do not produce at home, and especially when it gains for its English owner ])rotits arising from foreign protection. But it is badly and unpatriotically employed when it pays for the making or providing of goods abroad which might be made— at greater cost — at home." English capital may be used to grow French wine, but not to make French silks ! A shareholder in the Pennsyl- vania or Illinois Railway is doing good to his own country when the railway carries raw cotton, but not when it carries corn or cattle ! Looking to the whole of his letters it is clear that Mr. Howorth, like Lord Penzance, has never mastered the most elementary principle of the whole question, viz. that trade is exchange ; and that if we buy something abroad \ve must pay for it with something we make at home better or cheaper than the thing we buy abroad. But, Mr. Howorth may ask, How do you explain the support we have received ? Why is it that not only foreigners, but some, at any rate, of our own Lancashire workmen have been led or misled by Protectionist leaders into approval of Protectionist doctrines ? To answer this question has been one object of this book ; and I have added to this edition a separate chapter on the particular point on which, so far as I can understand him, Mr. Howorth principally relies — viz. the relation between high prices and wages.* * See Chapter XXV. 17 CHAPTER 111. PRELIMINARY CONSIDERATIONS CONCERNING FOREIGN COM- PETITION AND THE WAY TO MEET IT — ATTITUDE OF OUR TRADERS IN FACE OF PRESENT DIFFICULTIES — STATEMENT OF QUESTIONS TO BE DISCUSSED. Before stating the questions which 1 propose to discuss, let me refer to one allegation which has been made in this controversy — to the effect that "it is the race for cheap- ness caused by foreign competition which has demoralised so many of our own industries, and brought English goods into disrepute in once valuable markets." I need scarcely say that proofs or facts to substantiate this charge arc, as usual, wholly wanting. Nor will I pause to ask whether the evil, if it exists, is to be remedied by making English goods dear, which would l)e the inevitable effect of Pro- tection here, as it is now the effect of Protection in foreign countries ; but I will quote a passage 1 have come across in a letter from Josiah Wedgwood, dated 2ist April, 1771, more than a hundred years ago :— " The potters seem sensible of their situation, and are quite in a panic for their trade, and indeed with great reason, for low prices must beget a low quality in the manufacture, which will beget contem])t, which will beget neglect and disuse, and there is an end of the trade. But if any one warehouse distinguished from the rest will con- tinue to keep up the quality of the manufacture, or improve it, that house may perhaps keep up its prices, and the general evil will work a particular good, and they may continue to sell ware at the usual prices when the rest of the trade can scarcely give it away." We may see from this that the apprehension of com- petition begetting cheapness, of cheapness begetting bad- ness, and badness destruction of our trade, is not confined to the present generation, and existed when there was no foreign com})etition and abundant protection. We may also see what the clear-headed, stout-hearted Josiah Wedgwood thought to be the true way of meeting such c Demorali- sation of Manufac- ture by Foreign , Competi- tion. losiah Wedg- wood. i8 FREE TRADE V. FAIR TRADE. Sir Stafford Northcote. Present at- titude of ur Traders towards German and other rivals. competition ; and we may judge from the subsequent history of the potteries what the ultimate effects of his mode of meeting it have been — results wider, probably, than he ever contemplated. Let me support this view by an extract from a more modern authority. " We ought, I think, to put legislative remedies last, instead of first, in our system of inquiry. Of course, the great thing is to get the correct facts ; then to ask whether the depression in any particular industry is temporary or chronic ; and, if chronic, whether it is due to causes within our control. Sometimes we find ourselves face to face with impediments ivhich are absolutely insuperable, and which it is but waste of time and strength to contend against. But more commonly I think there are remedies to be found in the exercise of greater skill, the employment of more capital, the opening up of new fields of enterprise. Anything seems to me better than en- deavouring to get out of a difficulty by inferior work, which is what we are always tempted to try. If a farmer starves his land, if a manufacturer puts shoddy for cloth, and so on, he increases the permanent difficulties of his case, for the land becomes less productive, and the cloth loses its character and so loses its market. Foreign competition is, of course, one of the difficulties our working classes have to contend with ; hut that is a condition of our existence, and we must meet it in the best way we can."* If our traders act in the spirit of self-reliance advocated in the last century by Josiah Wedgwood, and more re- cently by Lord Iddesleigh, there is no fear of the result. But there are some indications of a different spirit, which alarm me more than foreign competition. From the reports given to the Royal Commission on the depression of trade, it is clear that many English manufactures are being displaced in civilised countries by home productions, and that English manufacturers are successfully competed with in neutral markets by those of other countries, and especially by those of Germany. This is only what might be expected, even if demand and supply were allowed to run their course unimpeded. We cannot expect to keep the * Extract from a letter written by Lord Iddesleigh, then Sir Stafford Noithtote to Mr. George Potter, dated 30th November, 1884, and published in the Times. PRELIMINARY. 19 manufactures of this world to ourselves, and over many causes which lead to this result we have no control. But throughout these reports there is one feature which is calculated to cause alarm, and which is not beyond control. From all sides, from neutral markets as well as from compet- ing countries, our Ministers and Consuls report that our foreign competitors — and especially the Germans — take far more trouble to ascertain the needs of the local market than we do ; that they have everywhere as agents countrymen of their own who can speak the native language, and who learn the native wants ; and that they take infinite pains so to manage and alter their manufacture as to meet these wants. If this is true, it is a thing which English traders have in their own hands, which they can set right if they will. If they do not do so they have only themselves to blame. It sometimes strikes me that the evils our traders now complain of, and the remedies they seek, differ from the evils and the remedies of which we used to hear in the early part of this century, in the palmy days of English trade. The complaints they then made were of obstructions to their own action, and the remedy they sought was the removal of those obstructions. They complained of apprentice laws ; of guild restrictions and monopolies ; of customs duties ; and of local exactions. What they now complain of is the action of their rivals, and what they seek are restrictions on competition. They desire more stringent patent laws ; they complain of the injury done by wrongful use of trade-marks ; they seek to prevent their competitors in business from getting lower railway rates than they themselves pay. The English farmer who finds foreign butter preferred to his own seeks to put re- strictions on the sale of butterine. The Sheffield manu- facturer seeks remedies against the German who sells his goods in England with English marks, and would carry his remedy to the extent of preventing the importation into England of any goods bearing English names. The English watchmaker, beaten in price by the Swiss and Americans, wishes to prevent the sale of hall-marked cases with foreign works. Adulteration and imitation are at- tacked, not because they are injurious to the consuming Remedies sought in restriction on others. 20 I'KKE TKADL; V. FAIR TKADE. public, but in order to prevent eoniitetition with the honest manufacturer. In many of these cases the complaints may l)e well founded and legal remedies may be desira])le. But all these efforts have one common feature — they all ])ro})ose to re- strict the action of rivals, and they are calculated therefore to raise a suspicion that English traders may be attri- buting their want of success to the wrong cause. Prac- tices such as those com])lained of may have soanc effect in diverting business from its proper channels. But they are not the chief or real causes of the success of the Germans or other competitors, and if they were \)\xi a stoj) to alto- gether that success would remain, and would inol)ably remain unimpaired so long as they show the industry, the ingenuity, and the versatility to which I have referred above. If Englishmen can, as Josiah Wedgwood said a hundred years ago, keep up the quality of their manu- factures ; if they take pains to consult the wants of their customers ; if, in a word, they rely on their own efforts, and not on restrictions to be imi)osed on their rivals, then there is no fear for the future of British trade. But since the time of the Corn Law controversy there has no doubt arisen a new generation, to whom much that was burnt into the minds of their fathers by a mortal struggle has become mei'ely an accepted tradition. There have been downs as well as ups in trade, and these have — not without fault on the part of Free Trade advocates — been attributed to our Free Trade policy. There has been a wave of National, as opposed to Cosmopolitan, sentiment passing over the world, which, if it has produced its good effects in the consolidation of a Free American Union, and the unification of Italy and Germany (effects, it must be remembered, odious to many of our own Imperialists), has also produced its bad effects in the Franco-German war, in the Pan-Slavonic movement against Turkey, in the tide of Imjierialism which has been sweeping over ourselves, in our Afghan and Egyptian troubles, in the French troubles in Africa, Madagascar, and Tonquin, in the adoption of a protective policy by the United States, and in the relapse into a similar jiolicy evinced by some of the nations of Europe and by some of our own Colonies. PRELIMINARY. 21 It is not amiss, under sncli circumstances, that we Hous should he reminded that there is no such thing in jwhtics ^P'n'on^^- as an " infalhhle dogma " ; that everyone has a right to a " pious o])inion " ; that a great political party and its leaders have a perfect right to advocate Retaliation or Reciprocity or Fair Trade, or whatever other name or form a reversal of our existing policy may assume ; and that that policy cannot exist, and ought not to exist, unless it is able to justify itself. There are, moreover, certain questions emerging out Questions of the chaos of wild assertions, to which sensible and dis- a^'^^nswer interested people, even though they may be resolute Free Traders, may justly require an answer, and which, per- haps, have not been as completely answered as they ought to be ; such, for instance, as the following, viz. : — How is it that a period of excessive export — such as 1870-1875— is a period of undoubted prosperity, whilst a period of excessive import — like the subsequent period — has been a period of comparative depression ? If the French Treaty was right, and was followed by enormous increase of trade, is it not right to put ourselves in a }:)Osition to make similar bargains by putting on duties which we can afterwards take off ? How is it that the trade of Protectionist or half- Protectionist nations — such as America, France, and Ger- many — has advanced as quickly as or more quickly than that of Free Trade England ? Does not the present attitude of the world towards Free Trade prove that the anticijmtions, and consequently the reasoning, of the Free Traders were wrong ? Can we do anything to promote trade with our colonies ? Questions such as these, taken by themselves, form detached parts of a great subject, and do not afford a satisfactory opportunity of dealing with the merits of Free Trade or of the objections which have been made to it. I was, therefore, very glad when an association was formed, comprising most of the persons who have been putting forward such objections, and when that association issued a iMogramme in which its authors not only professed to state in short tiM'ms their reasons for departing from Free Trade, but placed before tli*' world an oiithne ot the new 22 FREE TRADE V. FAIR TRADE. policy which they would have us substitute for the com- mercial policy of the last forty years. Such a programme, however worthless in itself, affords a definite subject for discussion, in the course of which we have the great advan- tage of considering not only whether our present policy is absolutely good, a question which in this incomplete world it is seldom possible to answer with perfect satisfaction, but whether it is or is not better than other possible policies. I propose, then, first to state the effect of the programme of the Fair Trade League ; to point out shortly the as- sumptions on which their proposal for a change of policy is founded ; to show the groundlessness of those assump- tions ; and then to criticise at some greater length the two main propositions contained in their programme. In doing this, we shall have the opportunity of treating the incidental questions which I have mentioned above. CHAPTER IV. PROPOSALS OF THE FAIR TRADE LEAGUE. Programme The programme of the Fair Trade League is not definite of League, jn its particulars, but its principal features are as follows : — 1. Raw materials of manufacture to be admitted free. 2. Food to be taxed when coming from foreign coun- tries ; to be admitted free when coming from our colonies and possessions. This taxation to be maintained for a considerable term, in order to give the colonies time to develop their jn'oducts. 3. Tea, coffee, fruit, tobacco, wine and spirits to be taxed 10 per cent, higher when coming from foreign countries than from our own colonies. It is not clear whether it is intended that they or some of them are to be free from taxation altogether, when coming from the colonies. 4. Imjiort duties to be levied upon the manufactures of foreign countries which now impose prohibitory PRELIMINARY. 23 Mr. Farrer Ecroyd's resolution. or protective duties on our manufactures ; such duties are to be removed in the case of any nation which will agree to take our manufactures duty free. I am not aware that this programme has been altered since the date of my first edition. The subsequent publi- cations of the League support, but do not materially vary, these proposals. Mr. Sampson Lloyd, in his letters published in 1882, Mr. Samp- would have us impose a differential tax on all foreign pro- son Lloyd's ducts in favour of all our colonies, with the threat that ^"^'^• if any one of them will not reduce their duties on our goods, we will withdraw the privilege from that colony, and tax their products as foreign. Mr. Farrer Ecroyd has embodied his proposals in the following resolution, which has at any rate the merit of being more definite : — " That, in view of the growing injury inflicted upon our industries by foreign tariffs, and the consequent import- ance of more rapidly developing the resources of India and the colonies, it is expedient to free ourselves as early as possible from the restraints of commercial treaties ; to abolish duties upon tea, coffee, cocoa, and dried fruits imported from British possessions ; to levy specific duties (in no case equal to more than 10 per cent, upon ordinary average values) upon the like articles, as well as upon wheat, flour, and sugar imported from foreign countries ; and also to impose an import duty upon foreign manu- factures, with the notification that it should cease to operate, as against each nation, from the day on w^hich such nation should admit British manufactures duty free." The recent agitation on the subject of the Colonies and Colonial Federation has given emphasis to the Colonial Policy of the Fair Trade League, and we hear in various quarters proposals embodying certain features of that policy. All the Protectionist or Fair Trade proposals mentioned in these pages have their supporters at the present time, except, perhaps, the very logical one (speaking from a Protectionist standpoint) that the colonies which refuse to reduce their duties on British goods shall have their own goods taxed as though they were foreign produce. Any 24 FREE TRADE FAIR TRADE. idea of retalialiny; against a colony, tliough in tariff matters it slujuld be as actively hostile to the United Kinj^dom as any foreign country, has been piously repudiated by the Balfour (Government. It has also ex- cluded from its ofticial programme any proposals to tax food, and Mr. r>alfour asks no more at present than liberty to enter into tariff negotiations with other countries on the understanding that their failure to grant tariff concessions may be met by retaliatory duties in the United Kingdom. He has, however, declared his sympathy with Mr. Chamberlain in the latter's unofficial Protectionist campaign, of which the declared objects are to impose a lo per cent. iluty on manufactured goods imported into this country ; to tax foreign corn — -with the exception of maize — at 6d. per cwt. ; and foreign meat — with the exception of bacon — and foreign dairy produce at 5 per cent, ad valorem, all these articles when imported from any part of the British Dominion being allowed to enter the United Kingdom free of duty. The Before dealing with the Fair Trade programme as a offiiese^^ practical proposal, several questions would have to be proposals, asked and answered, e.g. : — 1. What is meant by raw materials, and what is meant by manufactures, and what is the economical distinction between the two ? This is a question which has not always received the attention it deserves, even at the hands of economists, 2. What would be the effect on the revenue of the practical abolition of the duties on tea and coffee and fruit ? As a measure of economical and social reform, it would, of course, if the revenue admits of it. be welcome to every Free Trader. 3. Is it intended that food shall be admitted free from all our colonies, even where they levy pro- tective or prohibitory duties on the produce and manufactures of the United Kingdom ? And if not. is there to be a tariff bargain in each case ? 4. Are the manufactures of the colonies to be admitted free, even where they ])lace a i)rotective or pro- hibitive duty on the manufactures of the United Kingdom ? Two great Thcsc questions raise serious questions of principle and Principles, practice, the discussion of wliich might i)rove awkward PRELIMINARY. 25 to the Fair Traders, and which in general are, i)robal)ly from this reason, purposely left obscure. But there is sufficient intimation of two general i)rincii)les, viz. : — First, that we should depart from our present principle of neutrality, and that our trade with our own colonies and ])ossessions should be artificially encouraged by means of an artificial discouragement of our trade with foreign nations. Secondly, that we should place retaliatory duties on the manufactures of all countries which ])lace duties on our manufactures. These principles I proj^ose to discuss. There is one preliminary difftculty : The advocates of this new policy, like the other writers and speakers to whom I have referred above, instead of prefacing and sup- porting their proposals for so great a change by an appeal to evidence which it might he possible to sift, content them- selves with general assumptions, which may be denied by those who disbelieve them, but which it is difficult to dis- prove without a wearisome array of facts and figures. Thus it is assumed that our industries are permanently depressed and decaying ; that the excess of imports above exports is a sign of this decay ; and that we are losing our position as manufacturers in the markets of the world. These assumptions have been dealt with already in speeches by Mr. (iladstone, Mr. Chamberlain, Mr. Cross, and Mr. Siagg ; in Mr. Whittaker's article in the October nuniber of the Nineteenth Century of 1880 ; in Mr. Mundella's speech on Mr. Mac Tver's motion on November 1st, 1884 ; in Lord Granville's reply to Lord Dunraven on November 7th, 1884 ; in Mr. Williamson's article in the January number of the Fortnightly, 1884 ; in the publications of the Cobden Club ; in Mr. Giffen's published pai)ers ; in many articles of the Times, in the Statist, Economist, and other newsiiajiers, and have been conclusively disproved. The most important as well as the most recent information on this subject will be found in the tables given to the Royal Commission on the depression of trade by Mr. (iihen and Mr. West, and i)rinte(l in the Ajipendix to their First Rei>ort, 1885. It lias hccu siiowii tli;it. takinsj all the usual tests of I. Encour- agement of Colonial Trade. 2. Retalia- tion on Foreigners. Assumed National decay. These As- sumptions answered already. 26 FREE TRADE V. FAIR TRADE. national prosperity — the returns of trade, of shipping, of the income tax, of banking, of pauperism, of crime, of the genera' consumption of articles of food and luxury — the progress of the country as a whole has been, beyond doubt, great and continuous ; that recent depressions and fluctuations are such as have taken place at all times, and as can be explained by special causes, to some of which I shall have to recur below ; and that if there is anything exceptional in the present depression it is due to a general cause which operates on all nations, without regard to the question whether they are Free Traders or Protectionist. No answer has been given to these figures, except state- ments concerning the well-known depressions in certain businesses, and appeals from general experience to the particular evidence of special observers in particular cases. For convenience of reference, I have added in the Appendix a table, No. XXVI., containing a summary of the statistics of the population of the United Kingdom, and of facts relating to their condition, so far as the same can be obtained, from 1840 to the present time. It com- prises the following items, viz. : — Number of population, national revenue, national debt, local taxation, income tax, education, emigration, pauperism, crime, foreign trade, shipping, railways, clearing house and Bank of England re- turns, savings banks, production of coa' and iron, price of wheat, consumption per head of spirits, tea, sugar, and imported flour, and letters delivered. It is scarcely neces- sary to observe that such statistics are always more or less incomplete ; that they must be read with care ; and that particular conclusions must be drawn with caution. But they present a synoptic view which is sufficiently accurate for general purposes, and which leads with certainty to the general conclusion that the industries of our people are not failing, that their condition is not deteriorating, and that the nation is not in a state of decay. Beyond this I will not attempt to enter upon any general examination of the state of the country, and wc may proceed at once to examine on their merits the two leading principles of the Fair Traders — viz. a new Colonial Policy, and Retaliation upon Foreign Nations. In doing so I shall have occasion to touch^again on some of the PRELIMINARY. 27 above topics. In discussing these principles, I shall not confine myself to the actual proposals of the Fair Trade League, but shall endeavour to see whether the principles they advocate, which are not devo'd of a certain superficial plausibility, are capable of any practical application, even though that application is not contained in the Fair Trade programme. 28 PART 1. NEW COLONIAL POLICY. CHAPTER V. GENERAL CHARACTER OF THIS POLICY. The Fair Trade League ])roposc their new jwlicy not only as a measure of economical reform, by which, as they say, Freedom of Trade would be in substance promoted, and our production and wealth increased, but as a " Great national policy which, while stimulating trade at home and promoting the prosperity of all classes, would bind together more closely by the ties of a common interest the mother country and her scattered populations, strengthen- ing the foundations and consolidating the power and greatness of the em])ire." To some of us these words may appear not a little suspicious. They are not ill calculated to attract those who think that the glory of England consists in the extent of territory subject to her imperial sway, in domination over subject peoples, in superiority of strength, and in her ])ower to inspire fear in the other nations of the world. But they arc capable of a more innocent construction ; they may mean only that whilst free and j'yeaceful inter- course is to be desired amongst all mankind, it is especially to be desired and promoted amongst those who have S])rung from the same origin, who have the same history, who speak the same language, whose lives are ordered by the same laws and customs, and who are subject to the same form of government. If this is their true meaning, it is not for the Cobden Club — whose motto is " Free Trade, j)eace, good-will amongst nations " — to object to such a ])olicy, nor would I say onc> word against it. To imi)rove and render more corchal the relations between the United I'AKT I. — Ni;W COLONIAL i*OLICY. 29 Kingxlwm and our great Englisli-sj)eaking and self-governing colonies would, indeed, be a labour worthy of a statesman, or of a generation of statesmen. But the British Emj^ire is made up of very different elements. To deal with Canada or Australia, on the one hand, and with India or Ceylon on the other, as united with us by the same re- lation, and capable of being dealt with in the same manner, is to confound things which are really distinct. Even in our purely commercial relations with these different coun- tries there are, as will be seen below, great differences ; and in all the political relations by and through which the proposed new conuuercial policy is to becarried out thediffer- ences are still greater. There is, therefore, great reason to view with suspicion any plan which proposes to apply one and the same policy, and that an entirely new and ex- perimental policy, to all these different communities, and it is, at any rate, necessary to subject it to the strictest examination. If, upon such examination, it can be shown that the policy in question is founded on a misapprehension of existing facts, that its economical consequences to the colonists and to the mother country will not only not be what its advocates anticipate, but will be injurious to them both, and that, so far from strengthening the friendly relations of the colonies to the mother country, such a l)ol cy is calculated to cause ill-will and to precipitate dis- ruption, then we may, without hesitation, discard this latest product of Protection and Imperialism, as we have discarded other follies of the kind. At the present moment, when all England is crowding to the Colonial show at South Kensington, and ringing with the cheers given to our Colonial visitors, and with their enthusiastic expressions of loyalty, it may be un- welcome, and may seem ungracious, to say one word that appears to throw cold water on the generous and j^atriotic feelings thus evinced. But two reflections are aroused by these demonstrations which may not be out of place here. My first reflection is jiurely commercial. To an econ- omist, or to a man of business, and I think also to any person of average intelligence, the real interest of the Colonial Exhibition lies in the articles which can be Suspicious character of this policy. Present feeling about the Colonies. E.xhibiiion of Colonial manufac- turji 30 FREE TRADE V. FAIR TRADE. produced in the Colonies, and which cannot be produced, or cannot be equally well produced, here. It was with some- thing like a feeling of melancholy that I walked through bazaars of articles rivalling Oxford Street or the Palais Royal in finish, in fashion, sometimes in ugliness, and re- flected that many of them, and other articles of more importance, exhibited at South Kensington, have been forced into unnatural existence by foolish Colonial tariffs, to the detriment of many other useful and natural pro- ducts of the Colonies— products which Europe cannot produce herself, and which she would gladly buy from Asia, Africa, and America. It is to be hoped that, if the Colonial Exhibition is made perpetual, its managers will bear this in mind. It will be always interesting to see what the Colonies can do for us which we cannot do better for om'selves. But we do not want an everlasting Colonial Regent Street or Cheapside at South Kensington. My second reflection was a wider and a more serious one. I asked myself what this ebullition of Imperial feeling really means. Does it mean that the whole Anglo- Saxon race — I use the word advisedly — shall endeavour to live, act, and feel as if they were one people ; that they shall join in spreading free institutions — freedom in thought, treedom in speech, freedom in government, freedom in trade — over the face of the world ; and that they shall be prepared, when such interests as these are imperilled, to stand shoulder to shoulder in defence of them ? If so, God speed the cause ! Or does it mean that England and her Colonies are to enter into a League for the purpose of excluding, brow- beating, over-awing, or fighting the rest of mankind ? Does it mean that England is to cease to buy her food and raw materials, and our Colonies their manufactured goods, under any flag but our owti ; that English artisans are to be taxed in order to sweep United States fishermen out of the Bay of Fundy, German colonists out of South Africa, or French or German settlements out of the Islands of the Pacific ; and that, on the other hand, the blood of Canadians, of Australians, and of Hindoos shall be poured out to help England in filibustering or muddling in Turkey, in Egypt, or in Afghanistan ? If this is the object, we PART I. — NEW COLONIAL POLICY. 3I shall have need of a new Cobden ! The alternative is one of the most important which has ever been presented for our choice. It will not, of course, be presented in the bald form in which I have stated it. But the question is one which will undoubtedly, in some form or another, per- vade our future policy, and it is most important that we should make u]) our minds what is our ideal, and to which of the two tendencies we incline. Recent events have at the same time thrown light on the ideal which the present day Protectionists set before them, and have shown the utter falsity of the pretence that it needs tariff bargains to unite all parts of the Empire in any common cause. Mr. Chamberlain is deliberately appealing to prejudice against, and dislike of, foreigners in order to forward his tariff schemes where he finds them economically unacceptable, although the late war has conclusively shown that all her Colonies are ready to rally to England's side when, for good or evil, she is involved in war. The tightening of imperial bonds which is involved in the preferential tariff, and which is put forward as com- pensation for dear bread, is demonstrably totally unnecessary to unite the Empire for defence, and its object, therefore, seems to be its more effective organisation for the purpose of aggression. CHAPTER VI. ASSUMPTION THAT OUR COLONIAL TRADE IS MORE STEADILY INCREASING AND LESS FLUCTUATING THAN OUR TRADE WITH FOREIGN COUNTRIES. At the bottom of the new Colonial Policy lie two assump- Superior tions, which, though stated with the vagueness which s^owth characterises all the Fair Trade arguments, are no doubt steadiness to be implied from their programme. These are, first, of Colonial that whilst our profitable trade with foreign countries is J^tm^.^d both unsteady and declining, our profitable trade with our own Colonies is steadily increasing ; and, secondly, that 32 FREE TRADE V. EAIR TKADK. our own Colonics arc more and more ready and willing to receive our goods, whilst loreign nations are more and more disposed to reject them. I propose to deal with these two assumptions suc- cessively, and shah he ahlc to show that neither of them can be accejHed as true. Those who are satisfied already that these assumptions are unfounded ; that our trade with foreign countries is as valuable to us as our trade with our Colonies ; and that the trade of all countries is so bound up together that to limit one branch is to limit others also, may pass over the long array of facts and figures contained in this and the two following chapters, and go on to Chapter IX. Let us see what the Fair Trade League say in favour of the first of these assumptions. They give, in this i)ro- gramme, as the chief reason for the })ro})osal to tax foreign food, and admit Colonial food free, that it will " transfer the great food-growing industries we employ from Pro- tective foreign nations, who refuse to give us their custom in return, to our own Colonies and dependencies, where our goods will l)e taken, if not duty free, yet subject only to revenue duties almost unavoidable in newly-settled countries, and probably not equal to one-third of the Protective duties levied by the United States, Spain, Russia, etc." ; and to this is appended the following amazing note : — " Even at the present time every quarter of wheat imported from Australia affords us in return sixteen times as much trade and employment as a quarter of wheat imported from the United States, and every quarter of wheat imported from Canada thirty-five times as much as one imported from Russia " ! ! Mr. Farrer Ecroyd, again, who, in his article in the October number of the Nineteenth Century, 1881, made himself the expositor of the Fair Trade programme, says : — " Had it (viz. the ;^30,ooo,ooo of produce which he assumes to have been lost by our bad harvests) been })urchased from our own Colonists, the money would have come round again, and have given em])loyment to all our industries, as an immensely increased exi)ort of our manufactures would have paid the bill." And again : — " Our experience teaches us that in buying food from our Colonies we enjoy PART I. — NEW COLONIAL POLICY. 33 a return trade in our manufactures at least twenty times larger per head than with the Americans and Russians." And again : — ■" Assuming that we shall purchase food pro- duced in our own dominions as cheaply as it now is pur- chased in the United States or in Russia, experience assures us that we shall obtain in exchange for the pur- chase of it a dozen or twenty times more employment for home industries than we now do." It is really difficult to get at what is in the brains of Absurdity men who make such statements. It would seem that of their they think that the simple export of British goods without '■^^^°""'S- payment is per se a good to this country ; that Australia gets (say) sixteen or twenty times as much of our manu- factures in. payment for a quarter of wheat as Russia or the United States get ; and that, therefore, it is of the utmost importance to us to transfer our custom from Russia and the United States, to whom we pay so little, to Australia, to whom we pay so much. But it is the facts, not the reasoning, of these passages with which I have now to do. Mr. Farrer Ecroyd continues : — " In con- nection with this subject, let anyone carefully study not only the very large value of British manufactures pur- chased annually per head by the inhabitants of our Colonies as compared with the Americans, but also the remarkable steadiness of the Colonial demand as compared with the violent fluctuations in that of the United States. And, further, let him examine the expansion during the past twenty-five years of the outlet for our manufactures in India and our Colonies, compared with the stunted growth, or positive decline, of the trade to foreign high-tariff markets. He will then be able to form some idea of the demand upon our industries that would accompany the gradual transference to India and the Colonies of the grow- ing of fifty million pounds' worth of food, now annuall}- imported from the United States and Russia ; and, bearing in mind that the economic gain from that increase of employment, however great, would probably be of far less value than the moral and social results of its superior steadiness, he will begin to appreciate more fully the importance of this great question to our labouring population." 34 FKEH TRADE V. TAIR TRADE. Their evi- Thcsc Statements are very vague ; but the impression aUeged^'^^ whicli they convey concerning the facts of the Colonial f;ict. trade is shared by many persons who are not members of the Fair Trade League, and there is some evidence which may be fairly quoted in favour of it. There is, especially, one passage much quoted and relied on, which is both specific and accurate, and which, therefore, it is worth while to give at length. It is from an official report of the Board of Customs,* and is as follows : — " Exports." " Produce and Manufactures of the United Kinedoni." Customs ' ' ^ f^^po'"' of " The value of the produce and manufactures of the United Kingdom exported to foreign countries and British possessions in the year 1880 was as follows, namely : — £ Foreign Countries 147,806,267 British Possessions 75,254,179 Total 223,060,446 showing an increase of £31,528,688 upon the value of similar exports in the year 1879, or 16J- per cent., and by assigning to each of those divisions its proportion of the increase, we find that the value of the goods exported to foreign countries exceeded that of 1879 ^Y £17,276,620, or 13 J per cent., and that the value of goods sent to our Colonies and dependencies was greater by £14,252,068, or 23^ per cent., than in 1879. " The following table shows the percentage of difference in a series of ten years between the value of the export trade in goods of home manufacture to foreign countries and British possessions respectively, on a comjmrison of the figures of a given year, with those of the year preceding, namely : — * Parliamentary Paper, No. c, 2953, 188 1, p. 19. Observations having a similar tendency occur in the Reports of the Customs for subsequent years, but I will not occupy space by quoting them. PART I. — NEW COLONIAL POLICY. 35 Value of Value of Proportion Proportion Year. Total Value of Exports to Exports to of foreign of British Exports. P'orei^n British Countries Possessions Countries. Possessions. to Total. to TotaL I C £. Per Cent. Per Cent 1871 223,066,162 171,815,949 51,250,213 77 -o 23 'O 1872 256,257,347 195,701,350 60,555,997 76-4 23 '6 1873 255,164,603 188,836,132 66,328,471 74 'O 26 1874 239.558,121 167,278,029 72,280,092 69-8 30-2 1875 223,465,963 152,373,800 71,092,163 68-2 31-8 1876 200,639,204 i35'779,98o 64,859,224 677 32-3 1877 198,893,065 128,969,715 69.923,350 64-8 35-2 1878 192,848,914 126,611,428 66,237,486 657 34*3 1879 191,531,758 130,529,647 61,002, 111 68-2 31-8 i8i>o 223,060,446 147,806,267 75.254,179 66-3 337 Taking the extreme limits embraced by the table, we find that in 1871, when the total export value was almost identical with that of 1880, the i)roportion of the goods that found their way to our Colonies was represented in value by £51,250,213, or 23 per cent, of the total sum of £223,066,162, whilst in 1880 the proportion was £75,254,179, out of a total of £223,060,446, or 337 per cent." Articles. Apparel and slops Anns, aninuinition, and mili- tary stores Beer and ale Coals, cinders, and patent fuel Coppei, unwrought and wrought Cotton yarn Cotton manufactures . . . . Iron and steel, unwrought and wrought Leather, unwrouglit and wrought Machinery and mill work Paper of all kinds Silk manufactures Woollen manufactures . . . Other articles 'l\.tal . Value in the Year 1871. 1,538,370 356,845 1,195,663 881,418 817,063 2,258,368 19,166,944 4.591.917 1,133.988 999,401 486,084 320,787 3,172,110 14.331,255 Value in the Year 1880. 2,675,766 565,904 1,209,733 1,224,315 1, 206,888 3,789.685 27,349.975 8,222,146 1,362,581 2,065,995 959,378 878,089 4414-763 19,328,961 75.254,179 Increase in 188 as compared with 1871. 1,137,396 209,059 14,070 342,897 389,825 1,531,317 8,183,031 3,630,229 228,593 1,066,594 473,294 557,302 1,242,653 4,997,706 24,003,966 36 FREE TRADE V. FAIR TRADE. Customs Report of Customs Statement as to Colo- nial Trade incomplete and mis- used. " Exports to British Colonies." ' " We give [above] a list of the principal articles, with their values, that make up the aggregate of our trade with the Colonies, with the view of showing in what respect the increase Oi twenty-four millions, which has accrued in the same period of ten years, is chiefly exhibited. " The above-mentioned twenty-four millions represent an increase of nearly 47 per cent, in ten years in regard to our trade with the Colonies, but, on the other hand, the value of our trade with foreign countries has decreased in the same period f om ;^i7i,8i5,949 to ;f 147, 806,267, or 14 per cent., the total export trade for 1871 and 1880 being, as we have said, almost identical in amount, although showing such wide differences when classified under * Foreign Countries ' and ' British Possessions ' respectively." Now, this passage is, as I have said, perfectly accurate as regards the facts to which it is confined ; the misfortune is that it does not contain all the facts, or give a complete account of the case ; that it consequently conveys a wrong impression, and that it is capable of being misused, and has been misused accordingly. In the first place, ten years is far too short a time by which to measure the progress and value of different branches of trade. In the second place, this table only professes to give the exports of British produce from the United Kingdom ; it does not give the imports, and without this it is useless as an index to he comparative values of the foreign and Colonial trades, except, indeed, in the opinion of those who think that the value of our trade depends solely on what we give, and not also on what we get. In the third place, by lumping all foreign countries on the one side, and all the different British possessions on the other, an impression is produced that there is some general law governing each class, which produces results differing for the two classes, but identical for all the cases within each class ; and this imjnession is made use of with great effect by those who contend that the whole object of Trade is to export, and that, since the Colonies PART I. — NEW COLONIAL POLICY. 37 take a growing proportion of our exports, it is our business to encourage trade with our Colonies, at the expense of our trade with foreign countries. I have already pointed out how different are the circumstances of the different parts of the British Empire, and how much our relations to our self-governing Colonies differ from our relations to India. Now, it is not a little remarkable that if we analyse customs the above comparison of 1880 with 1871 we shall find report as that the greatest increase in exports to the Colonies, on Trade 'in-'' which the Customs report lays stress, is due to India, complete Our exports of British produce to India were : — and mis- used. III 1 87 1 ,, iSSo ,, 1890 ,, 1900 ;^i8,o53,478, or 8'1 per cent, of the total. 30.45', 314. or 137 „ 33,641,001, or I2'8 „ ,, 30,115,752, or 10-3 „ „ The exports to the Australian Colonies were In 1871 „ 1880 ,, 1890 ,, 1900 ^'10,051,982, or 4"5 per cent, of the total. 16,930,935,0^7-6 ,, „ 23,006,004, or 87 ,, „ 27,093,153, oi"9"3 >, „ The exports to British North America were In 1871 ,, 1880 „ 1890 „ 1900 ;,^8,2S7, 126, or 37 per cent, of the total. 7,708,870, or 3*5 ,, ,, 7,225,911, or 31 „ „ 8,126,710, or 2-1 ,, „ Exports of 1900 include the value of ships and boats (new) with their machinery. The value of these exports is not included in the returns of former years. Further, in 1880 the exports to British India were ;r9,ooo,ooo more than in 1879, thus accounting for three- fifths of the increased Colonial export for that year ; so that, whilst the exjwrts to India and to Australia very largely increased in the decade, those to British North America diminished. Similar differences might be pointed out in the exports to foreign countries. When investigated, they are often very instructive as I hope to show below. I mention this now only to prove, even within the narrow limits of the Customs table, how fallacious it is to draw from figures 38 FREE TRADE V. FAIR TRADE. of this description any such general results as the Fair Traders have done. It would be useless to cjuote or answer all the erroneous statistics, or erroneous conclusions from statistics, which have appeared on this subject ; but when so great an authority as Mr. W. E. Forster, in advocating Imperial Federation, is said to have quoted figures concerning the comparative value of our foreign and Colonial trade, some of which are inaccurate and others incomplete, it is wo th while to call attention to the fact. I need not say that Mr. Forster never indorsed the views of the Fair Traders, but, on the contrary, if I remember right, he expressly repudiated them. Mr. In a speech at Bradford, as reported in the Times of Forster's February 26th, 1885, are the following statements : — Colonial" " The annual trade of the British dominions beyond the Trade. seas with the United Kingdom was — exi:)orts and imports, £190,000,000 ; and with other countries £170,000,000 ; a total of £360,000,000, or six times what it was at the beginning of this century." These figures of the trade are, after deducting bullion, and deducting also Malta trade, in accordance with the official returns of the trade for 1882 ; but as regards the trade at the beginning of the century, I cannot find that there are any figures which can be quoted with confidence. Mr. Forster's speech, as reported, goes on to state that " the trade of the United Kingdom with foreign countries in 1872 was more than £248,000,000, and in 1882 was £214,000,000 — a decrease in ten years of £34.000,000 ; and that the trade of the United Kingdom with British posses- sions, which in 1872 was £66,000,000, had increased in 1882 to £99,000,000." The figures, no doubt, relate to the export trade only ; and if so, they are not quite correct. The actual figures are : — 1S72. To Forcitjn Countries . . . . • . ;^249, 000,000 To British Possessions .. .. .. /o6,ooo,ooo 1SS2. To Foreign Countries .. .. .. /"2i4,ooo,ooo To British Possessions . . . , . . ;^92,ooo,ooo PART I. — NEW COLONIAL POLICY. 39 But to take any single year as the test of the course of trade, without examining the circumstances, is very apt to mislead, and does so in this instance. It so happens that 1872 was a year in which our exports to the Continent were much swollen by the results of the Franco-German war, and the payment of the French indemnity,* and, probably, also swollen by errors in our own export figures. While our exports to foreign countries have not since quite equalled those of 1872, when they were stimulated by special causes, they have nearly regained that level, and our total trade, import and export, is much greater now than then. In 1872 our trade with the Colonies was in a very depressed state, and has since largely increased with their development and growth of population. Our exports to foreign countries and to Britiah possessions for 1892 and 1902 were as follows : — 1892. To Foreign Countries .. .. ... ;if 2 10,000,000 To British Possessions .. .. .. 81,000,000 1902. To Foreign Countries .. .. .. ;i^232,ooo,ooo To British Possessions .. .. .. 117,000,000 In 1872 our export trade had received an abnormal stimulus from the effects of the Franco-German war, causing a great demand for our goods and from loans made to America and other foreign countries, which were received in the form of merchandise. Even so, it was only owing to the extraordinarily high prices ruling at that time that the money value of our exports has not since been so large, for the quantity of goods exported is now very much larger. While the war of 1870 was a factor in stimulating foreign trade, the Lite war with the Boer Republics had a similar effect on trade with the Colonies, the exports from the United Kingdom to the Cape and Natal rising from ;^I7, 154,000 in 1S9S to ;^24,437,ooo in 1902— a rise which well exemplifies the necessity of considering special conditions, and of drawing conclusions as to the course of trade, only after following its ups and downs over a long series of years. It is also, for reasons given at length elsewhere,! misleading to take our exports alone, or our exports to * See below, pp. 49 and 50. + See below, pp. 49 to 70. 40 I'REK TKAUl': V. TAIK TRADIi. })articular countries, as tests of the \alue oi trade. Imports are as valuable as exports, and exports to a Colony may be, and probably are, only one link in a chain in a circuitous trade which binds England, the Colonies, and foreign countries together. The figures which I have given below and in the Appendix embrace the whole of our trade for many years ; and it is to these taken as a whole, and not to the reports for a l)articular year, that we must look if we mean to draw accurate conclusions. Mr. Forster is further reported to have said that the " total trade of imports and exports of the United Kingdom with the world outside British possessions had increased from 1854 to 1882 more than 77 per cent., but that the total trade, import and export, of the United Kingdom with British possessions had increased more than 170 per cent." If Mr. Forster said this, he must have been grossly mis^.ed. The official figures are as follows : — 1854 1882 cent. Foreign Countries. • ;^I 97,000,000 • ;^528,000,000 . ;^33 1, 000,000 168 British Possessions. .^"71,000.000 ;^ 1 92, 000, 000 Total. ^'268,000,000 ;^7 20,000, 000 Increase . . Increase per ;i^ 1 2 1, 000, 000 170 j^452,OOO,OO0 169 So that our trade with the Colonies, instead of in- creasing more than twice as fast as our trade with foreign countries, did in fact just keep pace with it. More com- plete figures on this point will be found below. It is no doubt difficult to give— except in figures so long and minute as to V;e unreadable — any general view of the comj)arative results of our trade with the different countries of the world, but I will try to do so as briefly as I can, relegating the more cumbrous tables to an Ap})endix. First, assuming the position held by the Fair Traders, that what we give, and not what we get, is the standard ])y which to judge of the profits of trade, let us see what our exports of British produce have beep since 1840. PART 1.— NEW COLONIAL POLICY. > s 41 ^- ^ kV "I 'O X 't T»; LTi t^ ^ q' -' o o o' a> uooo ,A ►^ CJ 1^ 1^ 1^ — rhw c>'^ 000 N "^ On N roo O LT-, I^ g^fl r?0 -^vo OvCT; d JT^ ^ :?- ON ON £> On "^ ly-i f^ u-lv^" On On N ON On t^-qo On ,S - " 5^^ — 10 CO NO nO_ CNl tJ- P) ^ I/- NO ONO->r M irj "^ Q. « i 1 O D 1> O CI I. 3 P5 U, c/3 ^ r-< O Exports to Colonies and Foreign Countries since 1840. 42 FREE TRADE V. FAIR TRADE. Putting these figures in the form of percentages, they are as follows : — To Colonies. To India 1840 23-0 10 i860 195 12-5 1872 . 16-5 7-0 I8S0 200 I3'S I8S4 21 5 13-0 1890 20*4 12-8 1900 22'I IO-3 1902 27-0 "•5 To Foreign Countries. 67-0 100 680 100 76-5 100 66-5 100 65-5 100 66-8 100 67-6 100 6i-5 100 There is here no symptom of any permanent increase in the percentage of the Colonial exports, but rather the reverse. The percentage of the foreign exports, which rose rapidly with the loans and inflation of 1872, has other- wise remained steady, and there have been great fluctuations in the percentage of the Indian trade. There is certainly nothing in these figures to lead one to suppose that we should sacrifice the trade with foreign countries in order to nurse the Colonial trade. The later figures added to Lord Farrer's tables bear out his con- tention that there is no symptom of permanent increase in the percent- age of exports to the Colonies and possessions. Not until 1902 did the percentage to the former reach the level of 1840, though Canada and Australia have greatly increased their population in the mean- time, and have their people distributed over .such a vast amount of territory that they are naturally better customers for manufactured goods than the more densely populated countries of Europe and America, which are in a better position to manufacture for tliemselves. As to the increase in 1902 to a percentage of 27 against 22*i in 1900, the great proportion of it is accounted for by the war in South Africa, which necessitated the sending of vast quantities of provisions and military stores to Natal and the Cape. The total exports of British produce to the Colonial possessions, exclusive of India, were in 1900 ^{^64, 263,000 and in 1902 ;^76,346,ooo, while the corresponding figures for Natal and the Cape were ;i^i 2,757,000 and ;^24,436,ooo. If British trade with the Colonies had not therefore been stimulated by the destruction of a vast amount of Briti.sh goods in South Africa, there would have been but a very small increase in its percentage to the whole export trade since 1900 ; 96 "6 per cent, of the increase was, in fact, directly due to the war. Another lesson to be learnt from the tables above is that any PART I. — NEW COLONIAL POLICY. 43 attempt to increase our trade with the British possessions by means of tariffs is either futile or unnecessary. Over India the United Kingdom has absolute tariff control, Canada gives a slight preference to Ikilish goods, while Australia has protective duties equal in their severity to those of many foreign countries, and levied upon British as well as foreign goods without preference. And yet in 1902 India took ^'32, 682,000 worth of British goods, Canada /■io,720,oco worth, while Australia and New Zealand took ^25, 207,000 worth. But no view of trade is complete which deals with Trade with exports alone, nor is a comparison of one single year at Colonies one period with another single year at another sufficient to j." reign show the general course of trade. I have therefore annexed* Countries four tables, showing for each of the last twenty-nine years '" ^^^^^ °^ the amount and proportions of our trade with foreign countries and with our own Co\"^nies and possessions re- spectively. The first of these tables gives the exports of produce of the United Kingdom ; the second gives the total exports, including re-exports of foreign and Colonial produce ; the third gives the total imports ; and the fourth gives the total of the imports and exports. For each year is given the percentage of the foreign and Colonial trades respectively. From these tables it is clear that whether we take, as the Fair Traders do, the exports of British produce only, or the total exports, or the total imports, or — which is the fairest test — the whole of the trade ex- ports and imports together, there is not the least gi"ound for the assertion that the whole of our trade with our own possessions has grown faster than our trade with foreign nations, or that it is subject to fewer fluctuations. Taking the exports of the produce of the United Kingdom, the exports to the Colonies were 33 millions in 1856, rose to nearly 54 millions in 1866, sank to 48 milhons in 1869, rose to 72 millions in 1874, fell to 61 millions in 1879, ^^^^ to nearly 85 millions in 1882, and fell to 81 millions in 1884, whilst the provisional figures for 1885 are 78 millions only. Of the imports, the Colonial share is smaller, but equally fluctwating. It was 43 millions in 1856, 38 millions in 1858, 93 millions in 1864, since which time it declined, being as low as 73 millions in 1871, and * See Tables I., II., III., and IV., in Appendix. 44 FKlil': TRADli V. FAIR TKADli. Trade with 78 millions ill 1878, rising again to ()2 millions in 1880, and to 99 millions in 1882, but falling again to 96 millions in 1884, whilst according to the provisional figures for 1885 there was a further decrease in that year to 88 millions. The imports from British Colonies and possessions were in 1S90 96 millions, in 1900 no millions, and 107 millions in 1902. Taking the whole of the trade of the United King- dom—imports and exports together — which is by far the fairest test, the Colonial share of the trade was 80 millions in 1856, 149 millions in 1864, 114 millions in 1867, 165 milhons in 1877, 145 millions in 1879, ^74 millions in 1880, 191 millions in 1882, and 184 millions in 1884. If we turn to the tables, we shall see that these fluctuations are as great as those which have taken place in the trade with foreign countries. The proportion which our Colonial trade bears to our whole trade has varied between 31-3 per cent., at which it stood in 1863, to 20*9 per cent., at which it stood in 1871 ; it stood at 25'6 per cent, in 1856, at 24-9 per cent, in 1880, at 267 per cent, in 1882, and at 25-8 per cent, in 1883. It has kept })ace with our whole foreign trade, and is in amount about a quarter of it. But it fluctuates as much as our foreign trade, and forms a smaller proportion of our whole trade now than it did twenty years ago. The later percentages are as follow : 1890, 25*5 per cent. ; 1900, 24"i per cent. ; 1902, 25"6 per cent. It still forms a smaller percent- age of our total trade than it did twenty years ago, i.e. in 1882. But even these figures, whilst amply sufficient to show that there is no ground whatever for suj)])osing that our foreign trade, as a whole, is either more precarious or less profitable than our Colonial trade, lump all foreign coun- tries and all Colonies together, and fail to show how different has been the course of trade with different Colonies and different countries, and how fallacious it is to include in one and the same class either the one or the other. I have therefore added to the Appendi.x some tables,* showing what has been the course of trade with each foreign country, and with each Colony or group of Colonies, for the last * See Tables V. and V'l. in Apiiendix. PART I. — NEW COLONIAL POLICY. 45 S3IJJU 3 o fo 1 T^ 1 t^ M 1 c^ 1 ■* 1 CO ro 1 ■^ •n r'1 't >+ VO ■^ ^ 1 VO I^ t^ t^ l^ r^ t^ t^ t^t>% I'-'JOX O, S3UJU, 3 J3430 u M 1 00 ■* CO ?*■ 1 p 00 O VO £ M fo " 1 't t •<*- VO - n ro 1 1 "1 "^ O t^ „ 1 - 00 vO UBdcf £ O o o O o o - - o o ") O 00 00 ^ 00 1 1 o- „ «"!MD £ fO N N N - " « I-I N u o ' 1 1^ 1 00 lO -^ i r., 1 ro ro VO nJM £ " 1 o O b O o O O O u N »^ 5° 00 00 1 O 00 OvO\ Cv !I!13 i-i i-i o o O 1 o O O O O a. 1 6 LT) 1 00 r^ t^ ro 1 CO ^ 00 lizujg u CU N ft 1 - ~ " "" n I-I ^ ;*j t^ VO ■-0 IT) CO 1 00 VO rf t 0, r^ u-l 00 00 " 1 ON Ov O Ov P) -" I^ idXSg C) »o OS o 00 vO On ° i " ro f ■* « I-I M 1-1 ■1 N N N c^ d, 1 :*) ^ (T. t^ vO VO lO VOIO 00 Xajijnx £ N N " . " - M 1- w -• ON 00 VO ^ VO ^ CO COfO t^ XiB^i ;^ M » H M N 00 O u-l N 1 O lO VO -"t Ov ?3UCJ_,1 a. z o O CN C\ Ov ON 00 00 Ov n N k^ 00 N N P» .o CO VO ro (uniSpg £ fO ^ ro ^ ^ ■5h ■* ■* ■+ rl- c" "»• to 00 ON o O lO rj- lO !>. P"«ll°H li-> u^ u-> lO \o vb lO io VO VO ■Xui-'iu Q, Ci o 00 N a\ 9^ O N t^ VO N -ja;) cu CTv 00 C>0 r-^ r^ 00 00 i^ r^ 00 (1 rO o N t^ p) VO M VO VO i;jssn>j Oh w-1 u^ ^ ro ■* ^ Tf 't Tt Tt . TJ T) 73 -a "O 'O . -o ^"^ S 6 S- So £ >o S 6 ?xA S d *c SR (/) CO W CO w 00 7)00 a) 00 OJ M iJ M .£ >.£ >.s >".= >.s >.£ ^.S 1/-I 1/-, U-) >n >o "-> lO 46 FREE TRADE V. FAIR TRADE. nineteen years, giving for each country and for each year the exports and imports separately, and the percentage which they constitute of the aggregate imports and exports. I have a^so added a table* giving a summary of the whole, showing, in the form of percentages, w^hat has been the proportion which our trade with each country and each Colony in each year, and in each completed period of five years, has borne to our whole trade. The following summary shows at a glance what pro- portion of our whole trade has been carried on with each foreign country and each Colony for each of the three periods of five years, ending with 1880, and for the subse- quent four years. Colonies and British Possessions. Statement of the proportion Per Cent, of oitr whole Foreign Trade carried on with each Colony. British British North West America Indies Australian Colonies India South .A.frica Other British Possessions Total 5 Years end- '( ing 1870. ) Pr. Ct. 27 Pr. Ct. 17 Per Cent. 4-8 Pr. Ct. 97 Pr. Ct 0-9 Per Cent. 32 Per Cent. 230 5 Years end- ) ing 1875. \ 3-1 IS 5-3 81 1-2 35 227 5 Years end- | ing 1880. i 2-9 1-5 6-6 8-S 1-6 35 24 6 5 Years end- | ing 1885. ) 3-0 I "2 76 97 1-6 32 263 5 Years end- ) ing 1S90. j 29 09 7-5 9'5 1-8 32 25-8 5 Years end- | ing 1895. \ 30 08 7-4 8-3 21 3-5 25-1 5 Years end- ) ing 1900. ] 3-6 0-6 7-2 72 24 2-8 37 3-6 246 1901 1902 3-5 41 06 0-6 7 4 67 7-2 71 37 3-4 252 256 Average for \ Whole Period 1 3-1 I I 67 8-6 I 7 3-4 24 6 See 'lable VII. in Appcndi.x. PART I. — NEW COLONIAL POLICY. 47 In order that I may not appear to overlook the facts reHed on by the Fair Traders, I give the following summary, in a similar form, of the course of our export trade to each country. The following percentages are the percentages of the total exports, including re-exports of foreign and Colonial produce. But the percentages are much the same as they would be if the exports of the produce of the United Kingdom alone were included, and in the tables appended the figures for both kinds of export are given fully. But, whilst I give these figures in deference to the weaknesses of the Fair Traders, I protest against the notion that exports are more important than imports, and also against the notion that the direct trade to or from each country and Colony shows the whole character of the transaction. Trade is circuitous, and the debt which accrues to us in consequence of an export to a Colony is often repaid to us by our imports from some foreign country. Moreover, as we shall see below, temporary causes have an immense effect both on our exports and imports ; and although in the long run trade balances itself, the exports to any one country for any given year, or short term of years, or even the exports and imports together, are often a most imperfect index of the nature of our whole trade with that country. It would take more time and more knowledge than I Observa- iwssess to explain in detail the figures contained in the ^'°"1,°" appended tables. Each foreign country and each Colony with each shows its own fluctuations, both of imports and exports, Foreign and these fluctuations have been as great in the Colonial and""^^ as in the foreign trade. It would be most instructive to Colony, trace these fluctuations to their real causes. Protectionist tariffs have, no doubt, in some cases, and to some extent, been causes of these fluctuations ; but other causes — such as the cotton famine, the Franco-German war, the French in- demnity, English investments abroad, bad harvests in Europe and good ones in America, the wars in South Africa and in Egypt — have probably been still more potent factors. To trace the effect of these causes would throw light on many a delusion, and it is to be wished that some competent person would undertake to do this completely. 48 FREE TRADE V. FAIR TRADE. %i U On t>. vf> o •.L vb \b b b M b i^vb N '> I-^ *- 1 «^ ; I--. t-. r^ •^ VOVO i^ sauiu,3 '3 00 "P op Tl- P CO o. I p p m Vj k. ^ (^ PI r^ ^ in N in Vf in Q ^ J-MiO A " "" " J 1 1 urrdEf '•J r^ r^ 7" 00 n ro P :*y^ N •a 1 A^ _i^ b 1 " b 1 " 1 N N ii ! 1 ^ cu.HO U \o pN p\ f^ IH p\ pN p « P 1 u N ^ ■-1 M <4 ^ ^4 N N N ■<5 1 PLi 1 1 ^ .^ ^ luaj 00 b 1 b o b b m ° b b [ b <: •^ !1!'13 u p b b <>3 b ON o p 00 b O ON » b op b ft< 1 ^ 2 1.5 iF'^-'a o J^ N 00 2" ■p\p ^ N D O u (U 1 S31CJS ^ t^ P ■* P P fO ON 00 m On ■5J -^ paj.un A "" d\ " b b N " Iz; „■ 5dt3a u t p P p in QO 00 NO Ci „• o 1"^ X3>jjnx o N V^ 00 T^ M N O r ^ yn £ r^ N N M N N N " N ^ o ^1 XiEii 00 1^ M 1 NO H O u » o 1/^ t^ - m 0\ 00 ■* 00 ^1 SDUBJ^ fa b b b^ K. K \o vp f^ \o ■* m o o m ■'^ u ro ro ro N N fO ■"* ^'■"l- r') ft. _^._^ -^ ■ - '■»^ -3 -a T) TS -a t: -o isl ^ go S lA I) d S »n Ul V bi lU ^ ^ <-.£ >.S ^.S > .B ^ .5 ><.£ >.S ^1 <^ in li-i in 1/1 ""' 'n in ^ I'AKT I. — NEW COLONIAL POLICY. 49 Colonies anu Bkitish Possessions. Exports to Staleinent of the proportion Per Cent, of Exports from United Kingdom, ^^ inducing A'e-exports, to each of the undermentioned Colonics. j Hritihh 1 Nortli America West Indies Australia India South Africa Pr. Ct. 07 Others Total 5 Years end- ) ing 1870. ] Pr. Ct. 2-9 Pr. Ct. 1-2 Percent , Pr. Ct. 5-4 ' 8-9 Pr. Ct. Per Cent. 40 23-1 5 Years end- ing 1875. 3-3 1-2 5-9 77 i 7-5 i I '4 40 23-3 5 Years end- \ ing 1880. ] 2-9 I-2 lo-i 2-2 2-0 4-3 i 284 5 Years end- | ing 1885. I 32 29 II 91 ^ 107 3 9 30-0 5 Years end- ) ing i8qo. \ I-I 85 ii-i 1 2-4 3-6 29-6 5 Years end- \ ing 1895. \ 27 11 7-2 10-4 ! 3-2 37 28-3 5 Years end- ) ing 1900. ( 2-5 0-9 8-0 1 97 4-4 4-1 296 1901 1902 2-8 3-6 0-8 08 8-5 7-6 103 5-4 47 32-5 9*9 7-5 42 33-6 Average for } Whole Period \ 29 ri 7-4 9-9 25 4-0 27-8 ' oreign Country and each Colony for 19 years. At present I can only call attention to one or two facts connected with the different trades. Our Trade with Germany and Holland. These two countries may be taken together, since Germany much German trade goes through Holland. Their pro- and portion of our whole trade, including imports and exports, J^o"''^"^- has remained steady during the last eighteen years. The exports increased in the five years ending 1875, especially in the years 187 1 and 1872, and decreased in the five years ending with 1880, and have since slightly increased. The exports of British produce to German\' were in 1870 50 FREE TRADE I'. FAIR TRADE. Effects of French Indemnity. 20 millions ; in 1872, 31^ millions, of which considerably more than one-half consisted of cotton and woollen manu- factm"es ; in 1880, 17 millions, and in 1884, nearly 19 millions. The German tariff may have been one cause of the diminution in 1880, and a real decline in the demand for English woollen manufactures may have been another. But in comparing the figures of cotton and woollen manu- factures of different periods, there are several circumstances to be taken into consideration. There were probably con- siderable errors in our Trade statistics up to 1872-73, making the value of woollen exports appear larger than it really was. Further, the price of the raw material con- stitutes a large part of the price of the manufactured article ; the whole of the raw cotton and much of the raw- wool come to us from abroad, and have to be paid for ; and the prices of both have fallen since 1872, that of raw cotton more than 30 per cent. The apparent loss on ex- ports has, therefore, to be diminished by the difference. But there was another temporary cause, independent of tariffs and of prices, which, no doubt, increased our exports to Germany in 1871 and 1872. The French indemnity of 200 millions was paid to Germany partly in French cash, partly in French exports, but partly also through England, so that a part — and probably no inconsiderable part — of the large English exports of merchandise to Germany in the period from 1871 to 1875 consisted, in fact, of advances to Germany on French account, to be repaid to England by France. This is confirmed by finding that the im]')orts into Germany from the principal European countries — viz. France, Belgium, United Kingdom and India, Italy, and also from the United States — during the last five j-ears 1871 to 1875, exceeded her exports to those countries by 23 millions a year, an excess which was reduced to eight millions in 1877.* It is also confirmed by the French statistics,! which, after showing a large excess of imports in 1871, probably to make up losses caused by the war * See Table VIII., giving the Exports and Imports of Germany from 1868 to 1877. These figures are tairitish and Irish produce to France were i8 millions in 1871, 14 millions in 1877, and nearly 17J millions in 1882 and 1883 ; so that, although there was a slight decrease in 1884 to about i6| millions, France is now taking more of our own produce than she did a few years ago. Her exports to England, in common with her exports to other European countries, increased still more largely, giving, as above stated, a surplus of exports over imports to these countries for the five years ending 1875 of 18 millions a year, a surplus probably due to the pay- ment of the German indemnity. Since then French imports into the United Kingdom have diminished from 46 millions in 1875 to 37^- millions in 1884. Since the last edition of this book there have lieen considerable variations in British trade with France, but, on the average, both exports and imports have increased. In 1890 tlic total exports were 24*7 millions ; from 1893 to 1899 they fell away considerably, ranging from 20 to 23 millions ; they rose to nearly 26 millions in 1900, and were 22 '3 millions in 1902. The exports of British produce, which were i6"6 millions in 1890, fell to 137 millions in 1898, attained hi<;h-water mark with 20 millions in 1900, and fell to I5'6 millions again in 1902. TJie large export of British produce in 1900 was chiefly due to purchases by France of specially large (|uantities of coal at very high prices. In 1890 British imports from France were 44*8 millions, between 1893 3"*^ 1899 they rose from 43 to 53 millions, in 1900 they were 53"6 millions, and in 1902 had fallen to 506 millions. The large increase in imports is chiefly accounted for by a very considerable addition to the amount of silk manufactures purchased from France, and smaller increases in our imports of sugar, wine, and woollen manufactures. From this increase in imports and the decline in exports of British origin (up to the year 1900, beyond which it gives no figures) a Board of Trade memorandum, 1902, on the commerce, etc., of the United Kingdom and foreign countries, draws the somewhat pessimistic conclu- sion that " there is no fpa-stion of the displacement of home manufactures in the United Kingdom through increased exports from France," while "our exports to France show a sensible decline.'" To this it may be answered, first, that the years 1900, 1901, and 1902 show a greater export of articles of British origin to France than any other three 54 FREE TRADE V. FAIR TRADE. consecutive years of our history, and, second, that an increase in our imports from France, in so far as it does not consist of goods sent in payment of interest on money borrowed, must be paid for by exports from the United Kingdom. Therefore, though French silks and woollens may to some extent have displaced British silks and woollens in the home market, there is no proof whatever that their importation has reduced the total volume of British manufactures exported or locally consumed. Silks and woollens are the raw material of the clothing and other trades ; sugar the raw material of jams, biscuits, and confectionery. In considering British trade with France it must further be remembered that Switzerland, having no ports, trades with the United Kingdom through Italy or France, and that in all probability much Swiss merchandise, such as watches and jewellery, reaches this country through French ports and is credited to France. The heavier and more bulky British produce sent in return to Switzerland would most naturally be taken in British ships to Genoa, and conveyed via Italy to Switzerland, and this may to some extent account for the fact that British exports to Italy always exceed imports thence. Our Trade with Italy. Italy. There has not been much change in the amount or proportion of our trade with Italy. But one thing is re- markable. Ita'y is one of the few countries where our exports exceed our imports. This they have done for the last nineteen years, at the rate of two millions a year and upwards. During the last fourteen years the excess has been four to five millions. Now, it is impossible to believe that we are doing trade with Italy at a loss. Is it not more than probable that Italy pays her balance to us in a circuitous way ? Looking to the French statistics (see Table X.) we find that the imports from Italy into France exceed the exports from France to Italy by an amount averaging in the ten years ending with 1877 five millions sterling a year ; and we hear, usque ad nauseam, that France sends us many millions more than she takes from us. It is, therefore, most likely the case that Italy sends us goods through France, and thus pays her balance to us, and increases the apparent French exports to England at the same time. Our trade with Italy has shown remarkably little variation in the course of the last twenty years. Imports thence were 3*5 millions in PART I. — NEW COLONIAL POLICY 55 1882, 3"3 millions in 1892, and 3'6 millions in 1902. For the corre- sponding years exports from the United Kingdom to Italy were 7' 5, 6'3, and 8"i millions. The exports showed more tendency than the imports towards increase, and the disproportion between them is even more striking than it was. Portions of our excess mports are probably occasioned by Italy and Switzerland sending us goods through France, the goods which we send in return being forwarded from Italian ports. Another item in our excessive exports bill is the expenditure in Italy of British tourists and visitors, who pay for Italian goods consumed and services rendered on the spot by drafts and circular notes, which are transformed into British goods exported to Italy. That the value of the exports thus occasioned may amount to a very large sum is shown by the fact that in 1880 it was estimated that ;^20,ooo,ooo worth of American exports were required annually to meet the expenditure of American citizens abroad. Our Trade with Turkey. Our imports from Turkey decreased largely between Turkey. 1877 and 1879, ^or reasons too obvious to dwell upon. They have since increased by two millions. Imports from Turkey, which were 6'9 millions in 1S77 and fell to 3"5 millions in 1879, had risen again to 72 millions in 1901, with a fall to 6 'I millions in 1902. Exports to Turkey have varied little, being 6 millions in 1877 and 6'3 millions in 1902. In 1877 Bulgaria, which in 1901 did a trade of half a million with the United Kingdom, was included in the Turkish dominions. Our Trade ivith Egypt. There has been a large diminution in our trade with ^sypt- Egypt, but some of it is nominal, because since the opening of the Suez Canal many cargoes to and from the East, formerly entered as to and from Egypt, have been entered as to and from the countries of destination and of ship- ment in the East. They may thus possibly swell the apparent increase of our Indian and Colonial trade. In the comparative cessation of the import of raw cotton from the East since the American market has been re- opened, and in the cessation of loans to Egypt after 1873, are to be found other reasons for the diminution of our trade with Egypt. Imports from Egypt, which reached the maximum of i6"5 millions in 1872, fell to a minimum of 6"i in 1S78, and rose to I3'8 millions 56 FREE TRADE V. FATR TRADE. in 1902. Exports to Egypt, wliich were y^ millions in 1S72, and were down to 2 "6 niillit)ns in 1882, showed a steady rise after the British reorganisation of the country, and in 19c 2 wore vahicd at 6'2 millions. Our Trade with the United States. It is our trade with the United States which is the pons asinontm of our Fair Traders, and I shall have occa- sion to refer to it again.* Our whole trade with them has increased very largely, both absolutely and proportionate!}'. It constituted 13-7 per cent, of our whole trade in the five years ending 1870, and 17-6 per cent, of our whole trade in the five years ending 1880. For the last four years it has ranged from I7"4 to 20-2 per cent., the lower figure being the proportion for 1884. Our exports to the United States were 117 per cent, of our whole exports in the period 1866 to 1870, and only 9-4 per cent, in the period 1876 to 1880. Be- tween 1880 and 1883 they ranged from 12 to 12-6 per cent., but in 1884 they were only ii-i per cent. This diminution, together with a considerable addition to the aggregate trade, is made up by an increase of imports. The exports to the United States, which had risen very largely in 1880, maintained themselves at about 37 millions up to 1883, and are still over 32 millions, being by far the largest amount exported to any one country, whether foreign or British. The imports from the United States, which were 107 millions in 18S0, were 99 millions in 1883, and 86 millions in 1884. It would be idle to repeat what has been said so often already of our loans to the United States made in the earlier period, and of the payment of interest upon these loans which now appear in our imports. Nor is this the place in which to attempt to disprove the assumption made without the shadow of an argument, and, as I believe, without the shadow of foundation, l\y some of the Fair Traders, that we are now calling back capital from the United States. This j)oint is referred to below in the chapter on exports and imports (Chapter XXIII.) ; here I will only notice that, in speaking of the reasons for the excess of imports, I have given some figures * See Chaj.ters XXXVl. and XLH. PART I. — NEW COLONIAL POLICY. 57 which, if they ai)i)roach the truth, show that we arc in- United creasing and not diminishing our foreign investments ; that ^ta'*-*s- we are still lending rather than recalling capital ; and, if this is so, the United States is certainly one of the countries to which we are lending most. One or two important facts I may point out which are shown by these tables — viz. iirst, that our exjwrts to the United States increased from 17 J millions, at which they stood in 1878, to 33 millions in 1884, having been as high as 39 millions in 1882 ; and, secondly, that there are circumstances mentioned below, under the head of Indian trade, which make it in the highest degree probable that we pay for imports of corn from America by exporting manufactures to our own possessions in the East. As an illustration of the way in which this may take place, I may quote a passage from the Economist in the second week of October, 1881 : — " Last week the steamer AustraHa, from Sydney, landed over a million dollars in gold at San Francisco. Australia, of course, pays this gold on English account." Taking ten year periods from 1882, when imports from America were 88'4 millions and exports to America 39 millions, we find a progressive increase in both, but much greater in the former than the latter. Imports for 1892 were 108 2 millions; for 1902 they were 127 millions ; while exports for 1892 were 41 '4 millions, and for 1902 43" I millions. Exports from the United Kingdom to America were at their lowest (28'5 mil ions) in 1S98, owing to the introduction of the Dingley tariff in 1897. They rose to 35 millions in 1899, and since then the increase has been steady, in spite of the very heavy protective duties of the United States. Since 1882, however, the exports of British produce and manufactures show a decline. The figures are : 1882, 31 millions; 1892, 26"5 millions; 1898, 147 millions; and 1902, 23 7 millions, the last being the highest figure reached since 1895. There is no doubt that our manufactures, especially woollens, are greatly hampered in United States markets by the high pro- tective duties, while with increase in population and the development of coal and iron resources, it is inevitable that the Americans should in any case manufacture (or themselves many of the goods formerly imported from this country. Our increasing imports from the United .States still consist principally of the products of agiiculiuie and stock raising, and of limber and pctrcjleum — in 1900, according to a Board of Trade memorandum, these items accounted for no out of a total of 139 millions, while the imports of machinery cmisisted chiefly of 58 FREE TRADE V. FAIR TRADE. patented articles, and of new types, principally electrical and metal working. In the B^ard of Trade meinorandam above referred to it is stated that probably portion of the excess of imports from the States is accounted for by the repurchase in the United Kingdom of American securities. This, however, seems to be a somewhat unfounded guess. In iSSo Sir Robert Giffeii calculated that the United States, in spite of a then excess of exports amounting to 35 millions, was still borrowing at the rate of ;^30,ooo,ooo a year, the excess of exports being insufficient by that amount to cover interest and rents due abroad, payment for the use of foreign shipping, and the expenditure of American citizens in other countries, the last item alone, as mentioned before, being reckoned at ;^20,ooo,ooo per annum. If these figures be correct, it is hard tj see where, with excess exports of about 100 millions a year, America has now any margin for redeeming securities, even if she has ceased to borrow. Thirty millions more of exports were required in iSSo merely to strike a balance, and since then a further excess is called for to meet the interest on the money borrowed in later years, when, as a matter of fact, the excess of exports for some time diminished instead of increasing. In the period since iSSo much British capital has gone into American enterprises, and many British subjects have purchased land in America, the returns from which are transmitted to this country. In the same period a number of Americans have certainly bought estates in the United Kingdom, but generally for purposes of pleasure rather than profit, and, far from increasing our exports to America, these purchases have involved increased imports to pay for the maintenance of, and expenditure upon, them. Then, again, it must be remembered that a very large proportion of the American trade being donejby British ships, as it increases an increased shipping bill falls due annually, which must be paid in American exports to the United Kingdom. Yet other items, perhaps small ones, in the excess of imports from the United States into the United Kingdom, are the amount of remittances sent by British and Irish emigrants to their relatives in the Old Country, and of contributions to various funds in Ireland by the Irish Americans, who have at all times sent home a considerable portion of their earnings in the land of their adoption. How much all these items, large and small, amount to is impossible to calculate without detailed investigation, which would be very interesting ; but when one looks at the facts, which seem to indicate that the American excess of exports is on the whole recjuired to make accounts balance, if, indeed, Ijorrowing has ceased ; ami when one further remembers the great number of reasons for which American PART I. — NEW COLONIAL POLICY. 59 money— in the shape of goods — flows into this country, without any return appearing in our exports, there appears no reason for hastily assuming that our excessive imports from America point to a re- purchase in Great Britain of American securities. A continuation of the increase in our exports to the United States would be welcome, but it would be unreasonable and foolish to feel uneasy at its being accompanied by a still further increase in our imports from that country. Our Trade with Brazil. Our trade with Brazil has dccUned, but the imports Brazil, have decreased more, and are now less, than the e.xports. As we have lent money to Brazil and do much of the carry- ing trade for her, it is clear that our imports from her ought very largely to exceed our exports to her ; and as her exports to the United States very largely exceed her imports from the United States, there can be little doubt that we pay some of our debts to the United States for corn and cotton by exporting our manufactures to Brazil. Since 1884 British trade with Brazil has increased again, but the latest figures show our imports greater than our exports. In 1884 imports were 47 millions; exports, 6"8 millions. In 1902 imports were 6 '2 millions ; exports, 56 millions. In the meantime the balance of trade between the United States and Brazil has remained as it was. The United States still import much more from Brazil than they export to her, taking 65 million dollars worth in 1900, and exporting only ii "4 million dollars worth. Peru. Our Trade with Chili and Peru. Both our aggregate trade and our exports to Chili and ^")^^|' •'^"'^ Peru considerably decreased in the five years ending with 1880, and for this the cessation of our loans to Peru, and the subsequent Peruvian collapse, and afterwards the war between Chili and Peru, arc sufficient reasons. They now show symptoms of revival. The revival of trade, of which symptoms were apparent when the above was written, was slow and intermittent, but lias since been con- siderable. Imports from Chili and Peru to the United Kingdom were in 1880 6' I millions, in 1902 5-9 millions. Our exports to these countries for the same ye^rs were 2*5 millions and 4'i millions. 6o FREE TRADE 7'. FAIR TRADE. Oiif Trade until China. Our imports from China maintained their comparative position until 1880 ; since then they have decreased a little both absolutely and comparatively, possibly in con- sequence of a larger quantity of Chinese goods going direct to Continental ports through the Sue/ Canal. Our exports to China averaged six millions in the five years ending 1870 ; nearly six millions in the five years ending 1875 ; and something less than five millions in the five years ending 1880. During the four years ending 1884 the exports have maintained about the same position as in the previous five years. This, however, is a case where nominal values conceal the real facts. Three-fourths and more of our exports to China consist of cotton and woollen manufactures. Now, the quantity' of cotton goods ex- ported to China during the five years to 1880 was 2"6 per cent, more than during the previous five years, and of woollen goods 18 per cent. At the same time the price of raw cotton, which forms a large proportion of the cost of cotton goods, was 23 per cent, less in the latter than in the former period, and the cost of raw wool also much less. Consequently the real value of the exports of the produce of British labour was considerably gi"eater in the latter than in the former period. Yet this increasing export trade is what the Fair Traders desire to check, by placing a differential duty on Chinese teas. It must also be remem- bered that Hong Kong, the trade with which swells the lists of Colonial imports and exports, s really a depot for China, and that in order to do justice to the trade of China a great part of our trade with Hong Kong should be added. Since 1884 uur imports from Chin.i liavc largely and almost continually declined, standing in 1902 at 24 millions. Os'er the same period our exports to China have steadily increased from 4"4 millions in 1884 to 7"2 millions in 1902, the latter sum being larger than that for 1S72. The decline in imports is sufficiently accounted for by the substitution of Indian an9b lu 5*3 millions in 1902, or, including Ilong Kong and Macao, from 47 millions to 6'5 millions. Probably a portion of the balance due annually to England is settled through France, which exports in excess to England and imported an excess from China in 1900 of 5"8 millions. Oiti' Trade wilh Japan. The aggregate trade and the cxi)orts have botli in- japan. creased. In later years the increase has been very great, especially in exports from the United Kingdom, which were 2'6 millions in 1884 and 9"9 millions in 1900, when they reached their highest. In 1902 they were 5 "3 millions. Our exports to Japan are liable to consider- able Huctualions, according to the loans asked for and the ships bought by that country since its late awakening from Eastern lethargy and its endeavour to rival European countries in manufactures and armaments; c.^., Japan purchased from the United Kingdom ships to the value of 3*4 millions in 1899, 2-6 millions in 1900, 3*4 millions in 1901, and only ;^25o,ooo in 1902. Since 1884 imports from Japan have increased from _^662,ooo, to I "9 millions in 1902. Oiif Trade ivith British North America. British North America is certainly one of the Colonies Britisii to which our Fair Traders would wish to show special favour. ^°''^'' It is Canada which is to profit by their new policy, especially l)y a tax on United States corn. Now, according to our own statistics, our annual imports from British North America have averaged 7J millions in the five years ending 1870, 10 i millions in the five years ending 1875, and ii| millions in the nine 3'ears ending 1884. Our annual ex- j)orts have averaged 6f millions in the five years ending 1870, 10 millions in the five years ending 1875, and 8-^ millions in the nine years ending 1884. So that whilst the imports from Canada have gone on increasing, our exports to Canada under her Protectionist tariff have not only not increased in proportion, but are less than they were at an earlier period. These are figures from our own statistics. I have not the most recent Canadian figures, but the fohowing is an extract from the speech made in the Cana- dian House of Commons by Sir Richard Cartwright on 62 FREK TRADE V. FAIR TRADE. Our trade March 3rd, 1885, ill answci' to Sir Leonard Tilley's Pro- c'\nadi tectionist budget speech : — "Of our own produce, we sold to Great Britain in 1873, 31,876,000 dollars ; in 1884, 37,410,000 dollars' worth. We sold 6,000,000 dollars more of our produce to Great Britain in 1884 than we did in 1873, and from the peo})le of Great Britain, with whom the Minister (Sir L. Tilley) desires to favour our trade, we bought in 1873, 68,360,000 dollars, and in 1884 we imported 41,826,000 dollars. We sold them 6,000,000 dollars more than we did eleven years ago, and we bought from them 26,000,000 dollars less, and the honourable gentleman considers that a proof, I suppose, of how favourable his tariff has been to the interests of our trade with Great Britain. I apply the same rule to our exports to the United States. In 1873, deducting bullion and short returns, we sold to the people of the United States 33,416,000 dollars' worth of goods. In 1884 we sold them 31,632,000 dollars' worth. We sold them about 2,000,000 dollars more than in 1873, deducting the goods in transit, with which the honourable gentleman has no right to complicate the account. In 1873 we bought from the people of the United States 38,147,000 dollars, and in 1884 we bought 49,785,000 dollars ; and that is the year in which we improved our trade with Great Britain, and in which we diminished our trade with the United States. Our trade with Great Britain is 26,000,000 dollars less than it was eleven years ago, and our trade with the United States is 12,000,000 dollars more than it was eleven years ago. And, Sir, that is not all. Our trade with Great Britain was based on a much smaller population in 1873, and our trade with the United States in 1873 was much more in our favour than ai)pears on the trade returns. " Then, it was we who did the smuggling ; now, it is the Americans who do the smuggling into this happy country." Sir R. Cartwright is borne out by the account given at the late meeting of the British Association at Montreal by the well-known statistician, Mr. Stephen Bourne, of the state of our trade with Canada. It is the more remarkable because the conclusichi he comes to is, that we ought to refuse to trade with all Foreign Protectionist countries in PART I. — NEW COLONIAL POLICY. 63 order to encourage our trade with Canada and other Colonies ! He says : — " Turning to the table which sets forth the imjiorts into Canada, it will be observed that the value has of late years exceeded that of the exports, both in the trade with the United Kingdom and the whole world, an indication that she is absorbing more than she is parting with. There is this great distinction between the two, that whereas the exports are of the raw materials for food or manufacture by the purchasers, the bulk of the imports are of manu- factured goods to be used or consumed by the customers. Even those shown as animal and agi^icultural products are mostly in a state for use ; whilst the manufactures and miscellaneous so greatly preponderate over the other classes as to altogether dwarf those in the comparison. In these, too, the proportion drawn from the United Kingdom is smaller than in the exports and less in value than those supplied by the United States. In both cases they range over every description of articles required for daily use, either for consumption or as instruments in carrying on the several industries. Like as with the exports, it is surprising to find that increase of population has brought no addition in value to the trade of recent years ; indeed, that of 1883 is less than it was in 1873. This is more marked in the drafts upon the Mother Country, which are, in fact, 40 per cent, less now than they were ten 3'ears ago. Lower prices may have in some degree caused this diminution, but if so as regards the exports from England, it enhances the increase of volume in the trade with the United States, where the difference between the highest year, 1883, and the lowest one, 1880, is as much as 90 per cent, upon the smaller amount. No doubt these conditions will be greatly altered when through railway communication exists, but at present it would seem that the Colony does not respond in the degi'ee which might be looked for to the investments of capital from the Mother Country or the additional people she is sending over. Increased consumption must be going on ; the inference therefore is that more is manufactured within the Dominion than there was formerly. The contiguity of the United States is doubtless a jiowcrful reason for resorting to her stores. 64 FREE TKADl': '.'. 1 AIK TKAni-: lliough not an encouraging feature in lier relations to the Mother Country." It is to be remembered that Canada largely increased her duties by her t^iriff of 1879, that she is still increasing them under the high-sounding title of a " National Policy," and the above figures show the results of this policy on her trade with the Mother Country. This subject is further referred to below (Chapters VII. and XXXVII.). Since Canada is the one country of the British Dominions which has so far tried the policy of giving a preference to British goods, it is worth while to note what its effect has been in encouraging imports from the Mother Country as compared with those from foreign stales. It was in July, 1897, that the first preferential tariff was estab- lished, making a reduction of 12.V per cent, on the ordinary tariff in the case of British goods, which reduction was increased in 1898 to 25 per per cent., and still further to 33 per cent, in July, 1900. In order to class together those years in all of which the preference was operative, the average exports to the United Kingdom from Canada and imports from tlie United Kingdom into Canada since the last edition of this book are shown for the following five-year periods : — Imports for Home Consumption. Hxports. 1884-88 /;8'6 millions ..■■ £ S'g millions 1889-93 8"7 ,, io'9 ,, 1894-97 tfour years) .... 6"8 ,, .... 141 „ 1898-1902 S'7 ,, .... 21 '6 ,, This table shows that there has lately been a considerable increase in our trade with Canada, and taken alone might suggest to ardent fair traders that the advantage derived therefrom by Great Britain was sufificient to justify the United Kingdom in imposing duties upon foreign products, if thereby Canada could be induced to extend the policy of preference and other colonies to adopt it. In tiie period since 1S97, however, Canada's population and development have con- siderably increased, with the natural result of an increase of trade, of which, in any case, the United Kingdom would have got a share. That our increased share since the preference came into operation is a smaller percentage of the whole increase than that enjoyed by several other countries not favoured by the preference is strikingly shown in the following table, condensed by Mr. Harold Co.\, Secretary of the Cobden Club, from an official French report on Canadian trade : — PART I. — NEW COLONIAL POLICY. Imports into Canada before and akter the British Preferential Tariff. United States United Kingdom Germany ... France Belgium Avcr.i^e of Five Years, Year 1901. Increase 1893-97. i L & 1 ^ 7. 11, 921, coo 23,018,000 ii,o57,coo 93 7,308,000 8,962,000 1,651,000 23 1, 1 20,000 1,463,000 313.0'0 3" 557,000 i,i2S,o;o 1 568,000 102 iS3,coo 797,000 644,000 421 For the year 1902 the Canadian imports for liome cniisumption from the United Kingdom were ;^io,li4,ooo, against ;^S, 839,000 for 1901, these being the figures given in the Board of Trade returns for August, 1903, and differing from those in the French report, taken from Canadian returns and cjuoted above. But in the same year, while e.\ports from the United Kingdom increased by i '3 millions, those from America increased by 2"i millions — from ;[^22, 702,000 in 1901 to ;{^24, 834,000 in 1902. Since 1897, when the preference was instituted, Canada has increased her imports from America by more than ;,f I2,oco,ooo ; she has increased those from the United Kingdom by little more than ^"4, 000,000. This shows that, in spite of tariff tinkering, trade will follow its natural lines, and that, whatever we may do, the great proportion of Canada's imports must be received from the United States, and, as things are, the free market of the United Kingdom is quite sufficient return for any trifling advantage given to this country by Canada. Our imports thence were in 1901 ;^i9,850,ooo, and in 1902 nearly p/,"?3,ooo,ooo, or 56-2 per cent, of Canada's total export trade. This is according to the British return. The Canadian statistics show a larger figure, as corn sent through American ports to the United Kingdom would there appear as Canadian exports, but in our figures would be entered as imports from the United States. The increase in our exports to, and imports from Canada, is very satisfactory, but tliere is wo suggestion to be found in the ligures that a conl'muation or extension of the preference would justily ta.xing the food of the Jkitish people, for, as Mr. Chamberlain himsel.f pointedly told the Colonial Premiers in July, 1902, ". . . the substantial results [of the preferential tariff] have been altogether disappointing to us , . . the total increase of the trade of Canada with foreigners during the jjcriod named . . . was 69 per cent., while the total increase of British trade was only 48 per cent.'' Kven this increase is resented by Canadian manufacturers who cry out against the preference, K 66 FREE TKADE T'. EAIK IKADE. Our Trade with the West Indies. The British West Indian trade has been nearly station- ary ; but our exports to the West Indies were shghtly less in nominal amount for the five years ending 1880 than for the live years ending 1875, though there has since been a tendency to increase. Since iSSo our imports from the West Indies and Guiana have fallen from 6,} millions in that year to 27 millions in 1902. This is almost entirely due to the ousting of cane sugar by the bounty-fed beet sugar of Europe, the importation of which at cheaper rates than it was sold abroad was of immense advantage to British manufacturers. The Sugar Convention lately ratified is intended, among other things, to deprive our manufacturers of the advantage of cheap sugar for the benefit of West Indian planters. British exports to the West Indies have not decreased by nearly so much as the imports thence, being 3-2 millions in 18S0 and 3 millions in 1902. The United States import from the West Indies and Cjuiana much more than they export, and thus the excess of West Indian imports from the United Kingdom, probably, in a circuitous fashion, pays for portion of our imports from the United States. Our Trade with the Australian Colonies. The imports from the Australian Colonies have risen from £11,423,000 in 1866 to ;f25,663,ooo in 1880, and to nearly £27,000,000 in 1881, and the rise has been steady, except in the case of a great jump in 1880. In 1882 and 1883 they declined by £1,000,000, but increased in 1884 to over 28 millions. But our exports have not risen in nearly the same proportions, nor so steadily ; they were £14,621,000 in 1866, and only £18,748,000 in 1880. In 1874-78 they averaged about 21 millions annually ; since 1880 they have risen, amounting to 28 millions in 1882, and to nearly 27 millions in 1883 and 1884. Australia is, however, the one grou]) of self-governing Colonies to which the Fair Trader will })oint as showing a steady ])rogressive increase in the wiiole trade, and a com- paratively large recent increase in the exports the)- take from this country. But I am not sure that the Fair Trader will be much comforted when he learns that one great reason for the increase of exports is the larger amount of the loans which England has been making to Australia. I'AKT I. — NEW COLONIAL POLICY. 67 The amount of her pubHc debt has increased from 27 1 Our trade milhons in 1867 to 78 milUons in 1879, and to 109 milUons w'^h in 1883.* It was estimatedf that our loans made to Aus- "s"^^'"^- traha in 1880 amounted to 10 milhons, and that her aggre- gate debt to us, including investments of all kinds, was not less 120 millions. It is probably now much more. In the Standard of December 30th, 1884, the Colonial loans for the previous year are estimated at £31,000,000, most of which probably went to the Australian group. In the same paper our Colonial loans in 1885 are estimated at 30 millions. The advance of the principal probably accounts for a large part of the increase of our exports. But I fear that the Fair Traders, who are so much alarmed at the imports which the United States send us in payment of the interest on their debt to us, will at no distant time have to groan over a similar excess of imports from Australia arising from a similar cause. And if the authority to whom I have referred is right in supj^osing that Australia becomes indebted to us every year for freight earned by our shipowners to the extent of many millions, they will have an additional source of alarm, for we shall get that amount of imports from them without giving them any visible exports whatever in return. Another thing to be remarked concerning Australia, as concerning India, is that she exports to the United States more than she imports from them. I have already men- tioned an instance of the way in which she makes payment to the United States on English account, and there are probably many more ; if we check our imports from the United States we shall check our exports to Australia, as well as to India. Since 1884 British trade with Austraha and New Zealand, Lotii in imports and exports, has continued to increase, and its total in 1901 exceeded that of the trade with India, and was more than twice as great as that with Canada. In the same year, when it amounted to 64*4 millions, it was exceeded only by trade with the United States, France and Germany running the latter's 664 millions very close. The variation in the proportion and amounts of Australasian imports and exports since the last edition of this book show in a striking manner the efTcct therein referred to of loans upon our trade. Thus * See Table XXV. in Appendix. t Sec the Economist, Aug. 27, 1881. Australia. (.n ^ ijuwe^i's j^. 68 ^li'#lfeft*DF 71 t1^' j^ort? trom this country. In 1892 thciL were general and considerable increases in the French Customs t.TriO'. TIic duties on wheat and (lour were increased in 1894-, and on meat (fresh and salted) and on live animals in 1903. On all the articles mentioned in the Appendix, Table .\II1., the rales PART I. — NEW COLONIAL POLICY. 8l of duty are now as high as, or higher than, they were in 1885. The average ad valorem equivalent of the import duties levied on the principal articles of British export from the United Kingd( m is calculaied by the Board of Trade at 34 per ant. Denmark. The duties are, with a few exceptions, the same as or Denmark, lower than in i860. No alteration since 1881. There have lieen no alterations of impoitance in the Danish tariff since the last edition of tliis book. Sivedeii and Norway. Sweden. — The duties have been generally reduced Sweden, since i860, and in no case increased, except on spirits and sugar. There has been no alteration of importance since 188 1 in the Swedish tariff. Norway. — In 1882 the existing tariff was revised, some Norway duties being increased and others decreased, but in the majority of cases the increases considerably preponderated over the decreases. In 1884 and 1885 further revisions were made, and certain changes effected in duties on articles of export from this country, there being a tendency to a slight increase. Ill Sweden and Norway there have been numerous alterations of dutie";, al! tending towards an increase in Protection. lUily. Between 1859 and 1879 tl^ere were large reductions, it.iiy. The duties were subsec^uently increased, but not to the extent of the })revious reductions. A treaty of commerce was established between Italy and France in Noveml^er, 1881, and put into force on May i6th, 1882, and under this treaty some important reductions were effected and extended to the United Kingdom, and a law was jiassed on July 6th, 1883, further modifying the Customs duties, slightly decreasing them in a few cases. Since November 29th last the surtax on spirituous liquors has been in- creased, and the import duties on a few articles of con- sumption were also increased at the same time — the list 82 FREE TRADE I'. FAIR TRADE. of articles including sugar, coffee, chocolate, chicory, syrups, glucose, and cigars. The import duties are, on the whole, lower now than in i860, but on some important articles of British produce they are higher. The tariff is now less favourable than that of France, but much more favourable than that of Canada. There has been an all-round increase in Italian Protective duties since 1885, the additions being principally made in 1888, but some reductions took place in 1892 in consequence of the com- mercial treaties already referred to. The tariff is now higher than that of Canada as far as articks of British export are concerned. The average import duties levied thereon are estimated at 27 per cent. ad valorem in Italy and at 16 per cent, ad valorem in Canada. Anstro-Hungary. The reductions between i860 and 1870 were very large indeed. A considerable increase has since been made on silk, cotton and woollen goods, and on leather, but the recent increases are nothing like the previous reductions. A new general tariff, involving a considerable augmentation of duties, came into force on June ist, 1882. As to articles included in the Conventional Tariff conceded to Italy in 1878, the augmentation did not take effect on British goods ; but other articles not so included are numerous. It has been for some time in contemplation to increase the duties on many articles, and a Bill for the revision of the tariff has been submitted to the Reichsrath with this object. The Bill has, in fact, been passed by the Lower Chamber, but its consideration by the Upper House has been postponed for a month or two. Austria is to have dear corn, and Hungary is to have dear manufactures ! Still, the Austro-Hungarian tariff is, on the whole, except in the matter of iron, considerably more favourable than that of Canada. In Austria, in 1887, there were several alterations in the tariff, generally in an upward direction. In 1S92 there were treaty reduc- tions, and the duties on some articles, such as pig-iron, steel rails, boots and shoes, and porcelain are now lower than in 1885, whereas those on woollen goods, agricultural machinery, printing paper, jams of all kinds, and iugar are higher. The average ad valorem rate PART I. — NEW COLONIAL POLICY. ^3 levied on British goods (at their export value) is estimated iiy the Board of Trade at 35 per cent. Spain. Spain reduced her enormous duties between 1859 ^^^ ^pa'"- 1879, but has since placed differential charges on English goods in return for what she considers our differential duties on Spanish wines. A new tariff came into force on August ist, 1882, but reductions which were made applied, almost exclusively, to imports from other countries en- joying most-favoured nation treatment, and therefore did not benefit British trade. On July 13th, 1883, the duties on certain raw materials imported into Spain were modified. Negotiations for a commercial treaty with this country have long been proceeding, and have at last been con eluded, so that we have now the benefit of the Spanish Conventional Treaty, which largely reduces the duties payable under her General Tariff. It is to be hoped that, in reforming her tariff, the abuses of her Custom House system will also be reformed, for they are quite as great impediments to trade as her tariff. Since 1885 Spain has enacted an entirely new taiilf, under which the duty on nearly every article has been raised, rails for railways being one of the few cases in which a reduction has taken place. The trouble with the United Kingdom concerning wines has been removed by the admission of wines of a higher alcoholic strength than formerly at the minimum British rate (jf duty. Portugal. Portugal also made some reductions in her heavy duties Portugal, between 1859 '^^"^^ ^879. A new Conventional Tariff, which considerably modified the old tariff, was conceded to France and extended to other countries by the law of June 7th, 1882, and the duties then established were of a more favourable character, many reductions being made, and in several cases ad valorem duties were substituted for specific rates. Some slight addition has since been made. In 1892 Portugal increased her tariti, almost the only item in which the duties are now lower than in 1SS5 being rails for railways. ^4 FREE TRADE 7'. FAIR TRADE. Under a reciprocal commercial treaty, Spain and Portugal admit one another's goods at a specially low rate uf duly, but except for this the United Kingdom enjoys the greatest reductions made l)y these countries in their conventional tariffs. Japan. Since 1SS5 Japan has instituted a comprehensive tariff, with duties of from 5 per cent, to 25 per cent, on the main articles of import. Among the few goods on the free list are rice, tea, oil-cake, raw wool, paraffin wax, and horses. The duties appear to be specially designed to give protection to the textile industries, woollen yarns, ^" ^^79 ^^^' siderable duties had been imposed, which have since been raised. They are now, on the whole, higher than those of Victoria. The general effect of the tariff remains un- altered. Queensland. Queens- There were no import duties in 1859 ! since then duties ^" ■ have been imposed, which, however, are not as high as those of the last-named Colonics, though higher than those of New South Wales. The changes since 1881 have not been important. New South Wales, after a short spell of moderate Protection lasting from 1892 to 1S95, introduced an ultra-Free-Trade tariff, and greatly thrived under it. In Victoria there w^^re steady increases up to 1S95, when Protection reached greater heights than in any other country, except the United States, the duties averaging more than 40 per cent. There were slight decreases in 1896, but at the establishment of the Commonwealth Victoria was still ultra- Protectionist. South Australia further developed her policy of Protection since 1879, as did Queensland also. Western Australia established high Protective duties, but not so high as those of Victoria, and joined the Commonwealth only on the condition that she should be allowed to reduce her inter-State duties gradually instead of abolishing them at once. When Protection against the more developed eastern States was doomed by Federation, the West Australians, not wishing to be exploited by the protected manufacturers of Victoria and New .South Wales, sent an almost solid Free Trade delegation to the Cummonwealih Parliament. The feeling was that it would be better for West Australia to buy cheaji in the markets of the world than dear in a protected Commonwealth market, of which West Australian manufacturers could hope for little share. Tasnnnia, when Federation came, had a high tariff of great range, covering nearly 90 per cent, of her imports, but levied more for revenue than protective jnirposes. Now all the State tariffs are merged in that of the Commonwealth, which is avowedly Protectionist, and higher than that formerly pre- PART I. — NEW COLONIAL POLICY. 87 vailing in most of the protected States, but much lower than that of Tariffs in Victoria. The Free Trade party is gaining strength, and the tariff Colonies, issue is that upon which political parties are divided. Under the new Commonwealth tariff it is calculated by the Board of Trade that the ad valorem equivalent of the import duties levied on the principal articles of I'ritish export to all countries (at export prices) averages only 6 per cent. This low rate is accounted for by the fact that cotton )arns, pig iron, tin plates, steel bars, and chemicals, which form a large proportion of British exports, are duty free in Australia, while cotton piece goods pay only 5 per cent, ad valorem, worsted yarn 5 per cent., linen manufactures 5 per cent., machinery iiYz per cent., and woollen and worsted manufactures 15 per cent. New Zealand. There were no import duties in 1859 \ i^ ^879 duties New amounting to 10 per cent, had been imposed on many Zealand. EngHsh products. These duties have since been raised, and the tariff is now as high, on the whole, as those of other Austrahan Colonies. In 1881 her duty of 15 per cent, on cottons was taken off. There has been no im- portant change since. In 1885 and 1886 there were additions to the tariff, principally to increase revenue and meet financial depression, but the New Zealand tariff, though moderate, is at present more protective than it was in 1881. Almost every article used in agriculture and primary production is free of duty. Nine per cent, is given by the Board as the average ad valorem equivalent of the import duties on the principal articles of British export. Canada. Has, as is well known, largely increased her duties by her Canada, tariff of 1879, 3.nd has since made minor alterations, which, however, have not changed the Protective character of her tariff. Some of these alterations certainly strike our in- dutries. Her tariff is now considerably higher than those of France, Italy, or Austria, and of course much higher than those of Holland or Belgium. It is thoroughly Pro- tective. It was expressly so intended by its authors, and bids fair, if the spirit in which it was proposed continues to prevail in Canada, to rival the monstrous tariff of the United States. Nor is there any tendency to improve- 88 I'REE TRADE V. FAIR TRADE. Tariffs in meiit. Sir L. Tilley on March 3rd, 1885, introduced his Coicries. budget in an elaborate speech. He is an economist who would gladden the heart of the Fair Trader. He apparently Canada. thinks that he can perform the feat of making goods dear to the buyer and cheap to the seller at the same time. He is shocked at the excess of imports into Canada ; he apologises for their increase in 1883-4. He prides him- self on redressing the balance of trade, and on making his country pay to foreign countries more than she receives from them. He quotes certain figures, not undisputed, to show that in consequence of what he calls his " national polic}^ " (which, it must be remembered, is a policy of Pro- tection against foreign, including English, goods), Canadian manufactures have increased in the number of hands employed by 50,000, in wages paid annually by ^^3, 000,000, and in annual value of products by ^^16,000, 000. He seems to think that this is a pure addition to the wealth of Canada, which, but for his policy, would have gone to foreigners or to Englishmen, instead of being, as it really is, a com- })ulsory and artificial transfer of the labour and capital of Canadians from the industries in which they can produce more to the industries in which they can produce less, and a consequent diminution of the aggregate wealth of Canada and of employment for its labour — a wrong not only to the Canadian consumer, who has to ]iay more than he would have to pay if he bought in the open market, but a still greater wrong to the Canadian labourer and emi- grant, who is prevented from producing what would give him the largest result and employ the largest quantity of labour at the highest wages. At the same time. Sir L. Tilley docs ■ not challenge the fact that in 1878, before his Protection- ist tariff, Canada sold abroad 4,127,000 dollars' worh of her owai manufactures, and in 1884 only 3,500,000 dollars' worth ; and that — whilst the ])oi)ulation and resources of Canada have greatly increased in the interval ; whilst Prince Edward's Island and Manitoba have been added to the Dominion ; whilst, above all, there have been enor- mous and exceptional demands in Europe for the natural ]noducts of Canada — the whole exports of Canada, in- cluding food and timber, which sto{>d at 73 millions of dollars in 1873, only stood at 77 millions in 1884. He Canada. PART I. — NEW COLONIAL TOLICY. 89 admits also that Protection has had its usual effect — viz. Tariffs in that of fostering unnatural production and causing a glut <^oio"'es- in the protected industries. He congratulates himself on having transferred from Great Britain to Canada the in- dustry of sugar refining ; but admits that Canada has a refinery too much. He congratulates himself on having ousted the foreign cotton manufactures, but admits that the protected Canadian industry has over-stocked its own market, whilst at the same time it cannot relieve itself by exportation. Does he look at this national policy as temporary ? Quite the contrary. He contem- plates a duty of 150 dollars on iron ; he increased the duty on printed cotton goods last year. On woollen goods, on pickles, on cutler}^ on mouldings, on jwcture frames, on imitation precious stones, on manilla hoods, on umbrellas, on china and earthenware, on hardware for furnishing, on chairs, on acetic acid, on tissue paper, on glucose, on carpets, on labels, on sheet-iron, on asbestos, on axle-grease, on cotton quilts, on extract of beef, on foreign tobacco, the Customs duties were, according to Sir L. Tilley, to be increased on the sole and simple gi^ound that these articles can be made in Canada. Nothing is too big and nothing too little ; his meshes catch everything. Even coal, the one essential for manufactures, and flour, the food of the people, are taxed for the sake of Nova Scotian coal-owners and of Canadian millers. Sir L. Tilley's successor, the Hon. A. W. McLelan, follows in his footsteps. In his Budget speech of March 30th, 1886, he adopts and extends Sir L. Tilley's policy. He con- gratulates the country on the decrease of its imports, and especially of manufactured goods ; he treats every manu- facture fostered by Protection as so much net increase to the industry and wage-earning power of Canada ; he will make the Canadian farmer wealthy, not by extending his natural foreign market, but by excluding foreign corn from Canada on the one hand, and on the other by forcing Canadian manufacture, and thus creating an unnatural market for Canadian corn in Canada ; he will enrich the Canadian agriculturist by raising the price of his tools and clothes ; the Canadian manufacturer by depriving him of cheap food. Fuially, he proposes to change ad 90 FREE TRADE V. FAIR TRADE. Tariffs in valorem into specific duties, and, apparently, in so doing, Colonies. ^^ increase them ; and to sweep into his Protective net Canada. certain articles now manufactured in Canada — such as putty, and iron sand, and philosophical instruments — which had escaped the microscopic eye of Sir L. Tille5^ In short, a Canadian has only to say that he is making something, and Sir L. Tilley and Mr. McLelan are ready to prevent their fellow-citizens from buying it of anyone else. I need hardly point out how many articles made in England are included in the above list, nor need I again refer to the fact mentioned by Sir R. Cartwright, that the imports of British goods into Canada, which were of the value of 68 millions of dollars (about £14,000,000) in 1873, were 42 millions (about ^(^9, 000, 000) in 1884 ; or to the further fact that our own exports to the United States amount to about ;^36,ooo,ooo a year. But I would ask my Fair Trade and Imperialist friends whether, looking to the matter from their favourite point of view of exports alone, they are ready to give up an export trade of nearly £40,000,000 in order to encburage one of less than a quarter of that sum ? and also whether the polic\' openly avowed by the successful minister of Canada is such as to invite England to restrict her own production and consumption in order to encourage that of Canada ? Surely if there is to be a rapprochement it should be from the Canadian side. The rapprochement from the Canadian side has come in the preference to British goods already referred to, and, as also already mentioned, the effects of that preference have been disappointing in the extreme. Before it was granted the Canadian tariff was raised to such a pitch that even under the preference clauses local manu- facturers were heavily protected against British goods, and so far there is no evidence whatever that Canadians are willing to reduce their duties so as to permit competition on anytliing like equal terms between British goods and their own. In return for the United Kingdom imposing a duty on foreign corn from which Colonial corn should be exempted, Canada and tlie other self-governing Colonies would certainly be willing to penalise foreign commodities entering their markets, but the vast proportion of these are goods in which Great Britain could in no circumstances compete — as, for instance, the great quantities of raw material taken by Canada from the United States — and even if the whole of the possible external trade of the Colonies PART I. — NEW COLONIAL POLICY. 9I now done with foreigners were gained by Great Britain, it would be a Tariffs in mere trifle in no way compensating this country for the risk of Colonies, quarrelling with foreign custorhers, even though preferenlial trade did Canada, not also involve raising prices to the British people in their own market. Sixteen per cent, is the Board of Trade's estimate of the average ad va'oretn ecjuivalent of Canadian duties on the principal articles of British export. Cape of Good Hope. In 1859 the duties were 7^ per cent. In 1879 they had Cape, been raised to 10 per cent. An additional 15 per cent, on the then existing duties was imposed in 1884. The duty on many articles has since been raised to 15 per cent, ad valorem, and other considerable increases made. In 1902 Cape Colony, Natal, Bechuanaland Protectorate, and Basutoland entered into the South African Customs Union, the Cu toms Union tariff being also in operation as regards articles impprted for consumption into the Orange River Colony. In 1903, under the Draft South African Customs Convention, the same import duties were levied in the Transvaal and Southern Rhodesia as in the above-mentioned countries. A feature of the common tariff is the preference of 25 per cent, to certain goods of British manufacture, a policy which was assented to by the Cape delegates only under the fear that a refusal would involve the products of their own Colony being subjected to duties in the rest of South Africa. Natal was in favour of the preference scheme, but it was carried for South Africa generally by the delegates from Crown Colonies who were not representatives of the people, and who forced upon Cape Colony the policy of discrimination against foreign countries, thus laying it open to retaliation, specially by Germany, which buys 70 per cent, of Soulh African wool. This Customs Convention is the first example of the adoption of Protection in a Bri.ish Crown Colony. The highest rate of duty now levied on goods of British origin is 7], per cent., several articles, among them locomotive and textile machinery, pig iron, nail.s, tin-plates, and steel bars bejng admitted free. West Indies. In Jamaica there are duties of 12^ per cent., which have West not been altered since 1859. indies, In Barbadoes duties of 3 per cent, have been rajsecj 02 FREE TRADE V. FAIR TRADE. Tariffs in Colonies. Mauritius. Ceylon. to 8 per cent. In Trinidad import duties have been re- cently increased. The duties in Jamaica have been raised to l6; per cent., those of 15arbadoes to lo per cent. Most items in Trinidad are dutiable at 5 per cent. Maitritius. Moderate duties exist, about 6| per cent., which have been very shghtly raised since 1859. No substantial change since 1881. Some i)i' the duties in Mauiitius arc specific; most articles of importation are now subject to duties of iO'4 per cent. Ceylon. In Ceylon there arc moderate duties, about 5 per cent., which have been raised to 6i per cent, since 1881. In Ceylon cotton yarns and cotton manufacluic-; pay 4 per cent. • duty, and most other articles 5.V per cent. India. India. In India the duties are moderate and few, and, as is well known, have been recently lowered ; and in 1882 the cotton duties were taken off altogether ; but this has been done not by the peo})le, or even by the Government of India, but by English influence. Cotton yarn is still free ; cotton manufactures dutiable at 3|^ per cent, and 5 per cent. ; other duties in the Indian tarilT range from i per cent, to 5 per cent, ad valorem. Conclu- sion that Protective tendencies are as strung in Colonics as in Foreign Countries. From the figures given in this and the preceding chapter it is clear : — First. — That with the important excejition of the United States no foreign country has since 1859 raised its duties to a point as high as that at which they then stood. Secondly. — That several European countries have, till recently, gone on continually reducing their duties, al- though the tendency at the jjresent moment is to increase them. PART I. — NEW COLONIAL POLICY. 93 Thirdly. — That there is no one of the self-governing English-speaking Colonies, except New South Wales, which has not increased its duties since 1859, and that some of them, and those the most important, have in- creased them largely. New South Wales duties were increased in 1892, reduced below their former level in 1896, and merged in the tariff of the Common- wealth in 1901. . Fourthly. — That the tariffs of several of the Australian Colonies are as high as, and that of Canada higher than, the tariffs of France, Italy, Austria, or Germany, and much higher than the tariffs of Holland, Belgium, or Norway. Consequently, the assertion of the Fair Traders, that whilst foreign nations are refusing our goods our Colonies are ready to take them duty free, or subject to moderate duties, is not only not correct but is the contrary of the fact. If tendencies are to be judged by experience, there is as great a tendency to Protection in our Colonies as in foreign countries. CHAPTER IX. IS A CUSTOMS UNION OF THE BRITISH EMPIRE POSSIBLE ? I THINK that it has been satisfactorily proved that the Assump- special assumptions on which the Fair Trade League have tions of based their demand for a differential treatment of the traders no Colonies are unfounded. ground for The direct trade with our Colonies is about one quarter ^'^^^ . of our trade with the world. PoUc'y!* The direct trade with our Colonics, and especially our export trade generally, has not, taking a long series of years, increased faster than our trade with foreign countries. At the ])resent moment the direct trade with our Australian Colonics and with India is increasing, prolxibly on account of our large investments in these countries. This is a 94 FREE TRADE V. FAIR TRADE. natural, and therefore healthy development of our relations with tliem. Trade with the Colonies is now about 25'6 of the whole. In late years exports to them have increased somewhat faster than those to foreign countries ; chiefly to India, already controlled in tariff' matters by the United Kingdom ; to Australia, which maintains the protection which Mr. Chamberlain insists kills our trade with the foreigner ; and to South Africa, where it has been more than doubled by war expenditure and expenditure consequent on the war. Even where our exports to our Colonies appear large, and those to foreign countries appear small, in comparison to our imports from them, there is good reason to believe that the exports to the Colonies depend upon, and are often caused by, the imports from foreign countries. Our trade with our Colonies is subject to fluctuations no less than that from foreign countries. The Colonies, or at any rate those with whom we must treat as independent and self-governing commu- nities, show at least as great a tendency to Protection as foreign countries. There is, therefore, nothing in the existing facts to call for a reversal of our settled policy of non-interference with trade ; nothing to justify an attempt to check trade with foreign countries in order to divert it to our Colonies. On the contrary, the trade of the Mother Country with the Colonies, and her trade with foreign countries, are both progressing, and they are so mingled that any attempt to check foreign trade, whilst it would undoubtedly diminish the whole bulk of our trade, would very probably interfere with and diminish that very Colonial trade which it was intended to encourage. But is it possible to do anything by legislation to en- courage our trade with the Colonies ? If so, by all means let it be done. The motto of the Cobden Club, " Free Trade amongst all Nations," is entirely consistent with the earliest and utmost possible development of Free Trade with our own fellow citizens. If there is to be choice amongst those with whom we are to do business, let us choose in the first instance to do it with those with whom in other ways we have the closest relations. Only let PART I. — NEW COLONIAL POLICY. 05 us be sure that we do not injure ourselves or them in so doing, and that in seeking for a closer relation than that which already exists, we do not strain the bonds which at present keep us together. The Free Trader will not j-ield to the Fair Trader or to the Imperialist in national pride, in jealousy for British greatness, and in all that constitutes the glory of the British name and character ; nay, he would be willing, where greater interests are at stake, to sacrifice to them some portion of material prosperity ; but when restrictions on commercial liberty are proposed in the interests of material prosperity, he requires to have it proved that they will really promote that prosperity ; and when they are proposed in the interests of imperial relations with our Colonies, he desires to be assured that they will not strain and weaken those relations. It would, indeed, be an object worthy of the ambition of any statesman or generation of statesmen to form a perfect Customs Union, embracing the whole British Empire. If it were possible to have no duties whatever in any part of that Empire on goods brought from any other part of it ; if, for purposes of trade, India, Canada, Australia, the Cape, and the West Indies were as much one country as Yorkshire and Lancashire, it would be a consummation at least as welcome to the members of the Cobden Club as to the most devoted Imperialist. But such a consummation is a dream. It involves the same fiscal system in countries differing widely as the poles in climate, in government, in habits, and in political opinions. It is contrary to the very principles of self-government. It would prevent any change in taxation in one of the countries constituting the British Empire, unless the same change were made in all. Desirable as it is, it may be dismissed at once from practical discussion. It has, indeed, been said that such a thing was at one time possible, and that it has been lost by want of states- manship ; that in giving our Colonies self-government we missed the opportunity of requiring them to adopt our tariff ; and that what would now be impracticable as an Imperial interference with their liberties would then have been willingly adopted as a condition upon which those liberties might have been granted. Such an assertion Customs Union of the British Empire a dream. Self-go- vernment ihvDlves freedom , and there- fore diver- sity of taxation. 96 FRKE TRADK 7'. FAIR TRADE. raises no practical question ; but it is, I believe, a com- plete mistake. Self-taxation is of the very essence of self- government. To have required such Colonies as Canada and Australia to adopt our system of external taxation, and to model their own internal taxation accordingly, and to continue to insist on that requirement, whatever their own change of opinion or condition might be, would have been to clog the grant of self-government with a con- dition which would have destroyed its value. Free Trade is of extreme importance, but Freedom is still more import- ant ; and to force Free Trade on a free country is a breach of the fundamental principle which includes Free Trade. Sir Wilfrid Laurier expresstd tlie strong belief of Canada in ihis sentiment when he said at Montreal, in August, 1903, that he could not agree to the surrender of any portion of his country's legislative rights for any consideration whatever, even for the maintenance of the Empire. There exists, no doubt, at the present moment a great and growing desire for union between the Colonies and the Mother Country, and there is good reason to believe that this desire is founded on and has its strength in feelings of mutual good-will. But these very feelings are a consequence of the relaxation of the legal bonds that formerly, whilst they appeared to bind the Empire to- gether, really strained the connection almost to the breaking point. To the statesmen who effected this relaxation a debt of gratitude is owing, not always acknowledged by the advocates of Imperial Federation. To attempt to impose either on the United Kingdom or on the Colonies any such legal fetter as a common fixed and fmancial system would be to uncfo the work which has been so fruitful in good results, and again to place the different communities which compose the Empire in perpetual con- flict. It is a confirmation of this view that the present l)romoters of schemes for Imperial Federation do not, amongst the many suggestions, wise and unwise, which they are putting forward, venture to include any serious proposal for an Imperial Customs Union. Less wise than their predecessors, present-day Imperialists of the bond-and-bargain school have pinned themselves to the sordid senti- PART 1. — NEW COLONIAL POLICY. 97 ment, " No preference ; no Empire." Yet with a loosening of legal fetters, Imperial sentiment and goodwill have attained a strength never previously known. The Colonies immediately become restive at the least suggestion that they should surrender one jot of their legislative independence. On no condition will they enter into a Zollverein. They do not found their attachment to the Empire on a commercial basis, but if commercial relations are suggested to them, no Imperial sentiment will prevent them from driving the hardest bargain that they can. In Australia, at least, the vast majority of the people have no sympathy whatever with the view that they can be coaxed and bril)ed into closer union with the Empire. No coaxing or bribing will induce them to take part in Imperial defence by heavy military or naval expenditure on troops or ships to be controlled by Great Britain, though they are ready to help the Old Country in time of need. When a proposal is made by the United Kingdom to provide an Australian squadron at a certain annual cost, the matter is discussed on a strictly business footing, and as a matter of business the offer which England thinks it worth while to make is accepted. At the same time, a large proportion of the electors and representatives, who jealously ask the utmost value for their money in British naval pro- tection, would be ready to spend many times the sum they pay to England on a perhaps inferior fleet that, as Australians, they could regard as their own. This point, though not strictly concerned with the tariff question, seems, nevertheless, worth dwelling upon, as it is typical of the attitude of one great section of the British people in relations with the Mother Country. They demand absolute independ- ence of action, though tlicy feel entirely one in sentiment with English- men in England, but they desire no political or fiscal union, and they will not do business on sentimental grounds. The .Vustralian squadron may be worth more to them than England asks, but they believe th^t England will not give it at a price that does not pay, and they regard it always as a mercenary organ of defence — it fails to appeal either to their national sentiment as Australians or their Imperial sentiment as Britishers. It is no link at all between the Old Country and the New, but rather a factor for division, since there is a certain amount of soreness on both sides — the British feeling that the Australians are paying too little of the naval bill, and the Australians feeling that if Great Britain ofTers to provide a squadron for their waters at a certain price, when the price is paid all obligations are fullilled. Left to themselves they would provide ships for themselves, and in the consciousness of national ownership and national control would fiml satisfaction for the increased expense incurred. In tariff matters also, if British goods were admitted to Australia at lower duties than foreign, it would not be because they were British, H 98 FREE TRADE V. FAIR TRADE. but simply and solely because in the taiiff changes of Great Britain Australians felt that they got a full business return. In no case is it likely that while Australia remained Protectionist it would reduce duties expressly designed to protect the local manufacturer against the manufacturer of Great iJritain, She might offer a seeming and futile preference in raising duties still higher against foreign goods, effective protection being maintained against those of the Old Country ; and it is noticeable that even in the rather loud-voiced Imperialism of Mr. Seddon there has been nothing more definite towards preference than a promise to raise duties against the foreigner. Mr. Chamberlain, in fact — acute ol)server though he be — utterly misunderstands the feeling of some of the Colonies for Great Britain. That of Australia is friendly, sympathetic, affectionate, ready to translate itself into help in time of trouble, but jealous of even the slightest encroachment upon independent action by the Common- wealth ; and among the Protectionists Imperial sentiment is none the less genuine because it is allied with keen trade jealousy. A friend- ship formed on other grounds is never strengthened by business ties, whereas an endeavour to found business upon sentiment has destroyed many a friendship. Therefore this attempt of Mr. Chamberlain to bind the Colonies and the Mother Country in a semi-sentimental semi-business union, where keen business on one side will be denounced as grasping anti-Imperialism on the other, is a real and serious danger to the existence of the Empire, which it is fondly hoped may be raised to unexampled heights on a sordid cash basis. CHAPTER X. PROPOSALS OF THE FAIR TRADERS FOR ENXOURAGING COLONIAL TRADE ARE PROPOSALS TO RESTRICT TRADE. Fair Trade DISMISSING the notion of an Imperial Customs Union to proposals (he limbo of impracticable ideals, is it possible for any- ferent'iai thing to be done by the British Parliament to promote Duties in commercial intercourse with the Colonies ? Co^"nie°s'^ The coufse proposed by the Fair Traders is to place a differential tax on articles of food which come from foreign countries, and to admit food from the Colonies free ; to charge more on articles of luxury, such as tea PART I. — NEW COLONIAL POLICY. 99 and coffee, tobacco, wine and spirits, coming from foreign countries than is charged on the same articles coming from the colonies ; and to charge adequate import duties on the manufactures of foreign countries which do not admit our manufactures free of duty, whilst allowing Colonial manufactures to be admitted free of duty. I presume this to be the meaning of the Fair Trade manifesto ; but I must admit that the original document is hazy upon the question whether the duty on Colonial tea and other luxuries is to be remitted altogether, and also upon the question whether Colonial manufactures are to be admitted free unconditionally, or only on the condition that our manufactures are admitted free into the Colonies. Nor have subsequent publications cleared up these doubts. Now, the first observation on these proposals is that They are they have for their object to divert trade by interrupting {'J^P^f;')'^^^ one of its natural channels, and therefore their effect must and be to diminish the whole volume of trade. They are, con- diminish sequently, open to the fatal objection which makes all Pro- tection odious to Free Traders — viz., that they hinder people from buying and selling where they find it to their interest to buy and sell — that they limit production by preventing peoj)le from using their natural capacity to the utmost in making and selling the things which they can make better than others. They are restraints on trade and manufacture. And when it is alleged that there will be no ultimate loss, because with due encouragement the new market will be as productive as the old one, the answer is that the burden of proof lies with those who make such an improbable assertion. Take Canada as an instance, since Canada is the Colony to which the Fair Traders point as able to supply us with corn. Now, so Fair far as Protective duties are concerned, Canada is, as I Traders ^^ have shown, fast following the Protectionist example of diminish the United States, though she has a good way to go before Trade, her tariff is so obstructive to her export trade as that of her great neighbour. Still, in spite of the advantage Canada thus reaps from her lower tariff, she now sends us only 3-8 per cent, of our imported wheat, whilst the United States send us 499 per cent. Of flour British 100 FREE TRADE V. FAIR TRADE. North America sends us 4-5 per cent., wliilst the United States send us 66-2 i)er cent. British North America in 1884 sent us 3-9 per cent, of our total food supi)ly, whilst the United States sent us 26-9. Is it conceivable, with the known advantages of people, soil, and climate which the United States possess, that any restriction on free pro- duction which the most audacious of Fair Traders might advocate, would so far change the natural condition of things as to enable Canada to displace her gigantic rival, without diminution of the aggregate produce, and without loss to the British customer ? In 1902, of flijur imported, the United States sent us 808 jier cent., Canada 9"8 per cent. Of our wheat, 53^5 per cent, came from America and 1 1'8 j^er cent, from Canada ; while of total food supjily the proportions sent were Canada 6 "9 per cent., America 28'0 per cent. It is needless to follow this ])oint any further. To shut out or obstruct our Foreign Trade must restrict pro- duction. Leaving this general objection, let us consider the proposals of the Fair Traders in detail. CHAPTER XL PROPOSED TAX ON FOOD. Differential Of 3.11 the i)roposals ol the Fair Traders, by far the most Tax on important is that which contemplates a ta.x on foreign Food the r S ^ ^ keystone of lOOQ. the Fair This ])roi)osal has been scouted by the working classes. Trade j^,-,(j jg rejected by the Conser\'ali\'e leaders,* and it seems superfluous to discuss it. Nevertheless, it is perhaps more defensible than any other ])art of the scheme. It is the keystone of the edifice of Fair Trade. It is the only bribe which offers a real temi)tation to the Colonist : it is the only threat which has any terror for the United States. • It has been recently emphatically repudiated by Lord Iddcbleigh and by Lord Salisbury. PART I. — NEW COLONIAL POLICY. lOI And if there is any interest in this country which demands Tax on protection h^om the legislature, it is that interest which is ^°°'^- at once suffering from bad seasons and from low prices, and which is deprived by foreign competition of the com- pensation for bad seasons formerly found in high prices. It is, therefore, difficult to discuss the scheme at all without discussing the proposal to place a differential tax on foreign articles of food. The big loaf and the little loaf are good electioneering answers, but they do not exhaust or explain the question, and they do not convey the whole truth. It maj/ be interesting, in the first instance, to see where Where does our supplies of food come from, and I annex tables* which °"'' ^^°^ have been prepared, showing the proportions in which *^°""^ ^ the different countries of the world supply us with each of our principal articles of food, and a summary showing what proportion of the whole each country sends. The following are the general results : — • Foreign countries send us 114 millions' worth, or 807 Four-fifths per cent, of the whole ; and our own possessions send us ^°'". 27 millions' worth, or 19-3 per cent. The United States counfr'lcs send us 26-9 per cent. France sends us 7-4 per cent., and and one- Germany 9-3 per cent. ; whilst British North America CofoS! only sends 3-9 per cent., and Australia only 2*5 per cent. ; Russia sends us 5-5 per cent. ; India sends as much as 7-4 per cent. ; China, sends 4-6 per cent. But India, which is of all our own possessions by far the largest pur- veyor, is beyond our present purpose, since we already arrange her tariff as we think best. The above figures in- clude so-called luxuries, such as tea, tobacco, coffee, wines, and spirits. But if we exclude these, and confine our attention to articles of food which are not stimulants, the result will be similar. Of wheat, British possessions send us 30-6 per cent., and of flour 5-8 per cent. ; and foreign countries, 69-4 per cent, and 94-2 per cent, respectively. Of meat British possessions send 20"2, and foreign coun- tries 79-8 per cent. Of animals for the butcher, British possessions send us 16-5, and foreign countries 83-5 per cent. France sends us 23-1 per cent., and Holland 39-8 per cent., of our aggregate importation of butter, whilst * See Tables XV'. and X\I., in .\ppendix. 102 FREE TRADE I'. FAIR TRADE. Where docs British North America only sends us 2"i per cent. Of come from? ^acon and hams, the United States send us 69-5 per cent., and of cheese 49"6 per cent., whilst British North America — the only Colony which sends us any of these articles worth mentioning — sends 6-8 per cent, of bacon, and 30-0 per cent, of cheese. Eggs come to us in large quantities from Germany, France, and Belgium, but only in very small quantities from the Colonies. Potatoes come to us in great abundance from France, but none from British America or Australia. Rice, sugar, tea, and coffee are almost the only articles of first-rate importance of which large proportions come from our own Colonies ; and these come not from Canada or Australia, with whom it is proposed to make tariff bar- gains, but from India, Ceylon, Maiu'itius, and the West Indies, in all of which there are at present moderate tariffs, and in which — India, perhajis, excepted — the j^owcr of consumption, and consequent market for our manu- factures, is extremely limited. In 1903 the taxing of food is still the head .ind front of the Pro- tectionist proposals, but it can no longer be said that it is scouted by all the Conservative leaders. The 1902 figures as to food supply are as follows, again including tobacco, tea, coffee, wine and spirits : From foreign countries, /1867 millions, or 79 per cent. ; from British possessions, £^g'6 millions, or 21 per cent. ; from the United States, 28*0 per cent. ; Germany, 6'0 per cent. ; France, 6'2 per cent. ; British North America, 6"9 per cent. ; Australia, \'^ per cent. ; Russia, 5'9 per cent. ; India, 4*4 per cent. ; China, 02 per cent. The supply of wheat and flour comes : from British possessions, 28 3 per cent, and 99 per cent. ; from foreign countries, 717 per cent, and 90'i per cent, respectively. Of meat, British possessions send 23-4 per cent. ; foreign countries, 766 per cent. Of animals for the butcher, British possessions send 217 per cent.; foreign countries, 78'3 per cent. Of our butter, France sends lo'9 per cent. ; Holland, 9'6 percent. ; Denmark, 453 jier cent. ; British North America, 64 per cent. ; Australia and New Zealand, 6'3 per cent. Of bacon and hams and cheese the United Slates sends 675 and 15 per cent, respectively ; British North America, 09 and 67*2 per cent. Looking, then, to the amount of food we get from foreigners, as compared with what we get from the Colonies, PART I. — NEW COLONIAL POLICY. IO3 it is clear that to legislate with the view of changing our source of supply from the one to the other is a task not to be undertaken lightly or without a clear view of the results. Let us see, therefore, what are the objections to it. CHAPTER XII. WHY IS A TAX ON FOOD OBJECTIONABLE ? The reason why it is not desirable to divert the purchase Tax on of food from the cheaper to the dearer market is not f'pod will simply that it raises the price of food. It will probably ot'Eood!^ do this, and the result would be most serious. According but this is to Sir J. Caird's calculations, made in 1878, our whole con- "^^ a''- sumption of agricultural produce was then worth about 370 millions ; of which 260 were home produce and no foreign. The increase of j)opulation requires an addition of about 4 millions annually ; and the proportion of foreign produce consumed has increased considerably since 1877. Assuming the consumption to be now 400 millions, Effects of a and assuming that two-thirds of this is home produce and Tax on one-third foreign, the effect of a general rise in price of °°^' 10 per cent, would be that our population would have to pay 40 millions for their food more than they now pay. And supposing that this rise in price were caused by a tax on food produced in foreign countries, 26 millions out of this 40 would go to our own landed interest at home ; and h win raire of the remaining 14 millions part would go to the Colonial lents. food grower, and the remainder only into the public ex- chequer. This is by itself a startling conclusion. But it is far from being all the evil which would result from a compulsory change of market. An equally important, if not more important, result would be that it would \n-e- vcnt both the ])urchascr and seller from getting the most they can with the means which Providence has given them. The buyer will have less to buy with, and the seller will liave less to sell. If the English people are compelled to 104 FREE TRADE 7'. FAIR TRADE. Fair Trade answers to this. Inconsis- tency of Fair Trade arguments. A Tax on Food will raise its price. buy their food at home, they will spend on the production of food an amount of energy and capital which, if employed in making something else, would buy a much larger quan- tity of food from America ; and they will compel the Americans to divert the capital and energy they now spend in producing food to making things which can be made much better and cheaper in England. The result will be just the same if our Parliament com- pels English people to buy their food in Canada. If they are to be deterred by a differential tax from buying the cheapest food in the United States, and to be compelled to buy dearer food from Canada, the result will be not only that England will pay more for her food, but that the Canadian producer of her food, having to spend more labour and energy in producing it than the United States farmer now spends on it, will have less to spend on English manufactures than the United States farmer has. To this the Fair Trader makes two answers. First, that the price of food would not be raised, because America has a surplus which she must export, tax or no tax ; secondly, that a rise in the price of food in this country would be a cheap price for the additional market for English goods which would be acquired in the Colonies by buying our food there. It is obvious that these answers are inconsistent with each other. If the price of corn is not raised in this country, and if America is still to supply our market at present prices, there will be no transfer of English purchases to the Colonial market, and the whole of the Fair Trade proposal will fail. It is only by giving a higher price that we can encourage a greater growth of Canadian corn. If the Fair Traders are consistent, and really wish to effect their object ; if they wish to confine our custom to those nations which buy freely from us, they must absolutely prohibit all goods, food included, from those nations which do not do so. To say we are to stop their selling, and still to receive from them what we now get from them, is blowing hot and cold. But, in fact, the notion that the price of corn would not be raised by a tax is absurd. The United States farmers are not under any spell to produce a certain fixed quantity of corn. They may, in a given year, under the PART I. — NEW COLONIAL POLICY. I05 stimulus of exceptional demands, produce more com than Tax on can be sold at a remunerative price, but they will not con- "^o^^- tinue to do so. They produce corn because we want it, and will pay them a remunerative price for it. If we check that demand by a tax, they will reduce their supply. The Western farmer is able to send wheat to Liverpool and London, because after paying cost of cultivation and of transport, the price leaves him a profit. If we increase these costs by adding a tax, it will reduce his market, and in many cases destroy his profit. He consequently will no longer produce, and will leave his farm for something else, as we know too well that many emigrants have done. The result of any tax on American corn, which is to transfer our custom to the Canadian market, must be to raise the price of com in this country. But, say the Fair Traders, " even if this is the case it is no great harm. Food is not a raw material of manufacture ; to raise the price of food will not necessarily raise wages, for, as Cobden said, Cobden wages do not rise and fall with the price of food. Our ^"oted o -^ . as an manufacturers, whatever happens to our workmen, will be authority able to produce as cheaply as before ; and they will be for raising able to sell much more, because the Colony will, in retum pood° for the corn, receive their manufactures duty free ; whereas the United States, by placing prohibitive duties on them, do their utmost to refuse them." " Even at the present time," so runs this precious argument, " every quarter of wheat imported from Australia affords us in retum sixteen times as much trade and employment as a quarter of wheat imported from the United States, and every quarter of wheat imported from Canada thirty-five times as much as one imported from Russia." One really does not know where to begin in dealing with such an argument as this ! " Food is not a raw material of manufacture ; for Cobden said that wages did not rise and fall with the price of food." It is difficult not to feel indignant at such a use of Cobdcn's name. What was it that Cobden really did say ? The Protectionists had accused him of wishing to lower wages for the manufacturers' benefit. They said, " You are doing no good to the workmen by lowering the price of corn, for wages will be lowered as the io6 FREE TRADE V. FAIR TRADE. price of corn falls, and that is your real object." To this Cobden replied, " You are utterly wrong : wrong in your imputations, wrong in your facts. Wages do not fall with the price of food ; wages have been highest when corn has been lowest. Nor am I seeking, nor shall I get, low wages. Low wages do not mean cheap labour. Let us buy foreign corn untaxed. The price of food will probably fall, but the demand for our manufactures at home and abroad will certainly increase, and the workmen's wages and the manufacturers' profits will both rise." Cobden was right, as the workmen well know : and they will no doubt understand the difference between him and his mis- quoters. Cobden said, " Leave corn untaxed, let food fall, and let wages rise." The Fair Traders say, " Tax corn, let food rise, and let wages fall." And they quote Cobden as their authority ! But let us consider a little what the effect of raising the price of food to the workman himself really is, and let us omit for the present all consideration of the market for our manufactures caused by the purchase of food abroad. The workman's wages will go less far than they did, and the comforts of his life will be reduced ; if the labour-market admits of an increase in wages, he will demand and get it, and the cost of production will be in- creased accordingly to the manufacturer ; if it does not, the workman will be reduced to the alternative of either living in less comfort than he has done hitherto, or of emigrating. If he does the former, not only will he and his family suffer, but he will be obliged to spend more upon food and less upon clothing, and this in itself will reduce the market for manufactures. If he emigrates, so much productive labour is lost to the country. To the manufacturer, employer, and workman alike, any artificial increase in the price of food is fcr se an unmixed evil, even without considering its effect upon the foreign market for our manufactures. Much more is it an evil to them when it is remembered that the same measure which increases the price of their food also prevents them from getting the full return for their own expenditure of skill, capital, and labour. PART I. — NEW COLONIAL POLICY. I07 All the inconsistent arguments dealt with above are used by Tax on present-day Protectionists, and others equally absurd are popular, as, '"oo^- for instance, that a tax on foreign corn will so encourage production at home and in the Colonies as to reduce prices below the present level — much to the delight, one imagines, of the "struggling farmers " of the Empire. Another of Mr. Chamberlain's promises involves admission of a rise in the price of food subjected to duties, thus directly contradicting the argument above, and is to the effect that cost of living will not be raised, because duties will be taken off tea, coffee, tobacco, &c. These taxes all go to the public Treasury ; a great part of the taxation on food products goes in the shape of higher prices to local and Colonial landowners exempted from the duties paid on foreign produce. Therefore, to keep the cost of living at its present level, it would be necessary for the Exchequer to surrender in tea, tobacco, and such revenue duties three or four times as much as it would gain from the protective duties on food. It is, of course, possible thus to keep taxation at its present level and give away a large proportion of the proceeds to private individuals instead of spending them on public needs ; but the advantage of doing so is not obvious. CHAPTER XIII. FALLACY OF SUPPOSING THAT COLONIAL MARKETS WILL COMPENS.\TE US. But then, say the Fair Traders, this evil is to be com- Dealings pensated, and more than compensated, by the additional ^^■"^' *-"oio- market for our manufactures which will be opened to us in no't n^'J^e the Colonies. Now, in the first place, I have shown that profitai)ie the tendency of the Colonies is to close, and not to oj)en, i','^^"\^f,h'' their markets, and that in Canada the duties recently Foreigners. imposed on our manufactures, though not yet equal to the enormous duties of the United States, are approaching them, and are higher than those of many foreign States. But let us assume that the Colonial duties on our goods are and continue much lower than the foreign duties, where is the new market to come from ? Does the Fair Trader think that the United States farmer sends us a shipload of corn for nothing, and that if we get it instead from the io8 FREE TRADE 7'. FAIR TRADE. Tax on Food. The price paid in goods for a quarter of corn sold in ICngland is the price in the Enghsh market, and it is the same wherever tlie corn comes from. Colonial farmer we shall still give to the United States what we now give, and also give to the Colonial farmer, in exchange for his shipload of corn, many shiploads of manu- factures which we now turn to some other beneficial use ? If he does tliink this, does he think that the second trans- action is much better for us than the first ? And if he does not think this absurdity, what can be the meaning of the astonishing statement I have quoted above from the Fair Trade League circular ? He apparently takes from the statistics of trade the quantity of corn imported from Australia and the United States, and the quantity of our manufactures exported to those countries respectively, and, finding that for every quarter of Australian wheat imported we export to Australia sixteen times as much of our manu- factures as we export to the United States for every quarter of United States wheat, comes to the conclusion that for each quarter of Australian wheat we pay sixteen times as much of our cotton and cloth as for an equal quantity of United States wheat, and that the transaction is conse- quently sixteen times as profitable, not to Australia which receives, but to England which pays, this wonderful price ! These are the new prophets who are to subvert the doc- trines of Cobden and Peel ! The fact, of course, is that for every quarter we import, whether from Australia, from Canada, from Russia, or from the United States, we pay the market value — no less and no more. Whether it is paid for by the export of an equal value of English manu- factures to the United States, or by the export of English manufactures to India, or to some foreign country, and by a further export from that country to the United States, or even by some route more circuitous still, or by the re- mittance of bullion, or by a cancellation of interest upon debt, it must be paid for by this country, and the price paid for it will be the value of a quarter of wheat in the English market. The United States farmer does not give us his wheat for nothing ; he takes from us whatever the competition of the English farmer, the Canadian farmer, and the Russian farmer allows him to take. The Canadian farmer does jirecisely the same. If they comi)ete on equal terms they obtain equal jirices, and set going an equal quantity of English labour to provide a return. If the PART I. — NEW COLONIAL POLICY. IO9 United States farmer is able to j^roduce wheat more Tax on cheaply and abundantly than the Canadian farmer, he can ^°°'^- give us a larger quantity in return for the same quantity of our labour ; in other words, both his labour and our labour go farther ; there is more production, and both benefit. If under these circumstances we forcibly transfer the business from the United States farmer to the Canadian farmer, we do not thereby get a new purchaser for our goods, we only substitute a worse for a better purchaser — ■ a worse for a better supply. But then, it is said, Canada, Protectionist as her tariff is, is less Protectionist than the United States, and does less to keep our goods out of the market. If this is the case, she and we both get the benefit of it now. The Canadian farmer is so much the better off, and so is our manufacturer. All the good we can get by the lower tariff of Canada we are now getting. We shall not in- crease that benefit one jot by adding to the obstruction now caused by the United States tariff a new ob- struction of our own. The United States tariff is doing serious injury both to the English manufacturer and con- sumer of corn, and to the American farmer and consumer of English goods ; to the former probably less harm than to the latter, because the Englishman has the rest of the world to go to, whilst the American cannot escape from his own tariff. But the injury thus caused will not be dimin- ished, but aggra\-atcd, by interposing another obstruction of our own. In short, if, under the existing Protectionist American tariff, the American farmer can compete with all the world in the English market, it is because what England has to pay him with goes farther in the American market and pro- iluces a greater return than it does elsewhere. To transfer the custom furcibl>' to the Canadian market is to make what England has to jxiy with worth less than it now is. I sometimes think that there is a fatal confusion m the Confusion minds of Fair Traders and Protectionists between a com- between niercial treaty, or arrangement between nations, and the eo'^,l',,'ierdal individual dealings of commerce. The Commercial Treaty dealings ' assumes the mischievous and delusive form of a bargain, in ^"'^ '"'^'■" wliich we, as a Free- trading nation, appear to giw much "^"°"'^'- no FREE TRADE V. FAIR TRADE. Treaties or and receive little. Hence people are misled into a hazy con- me^"P elusion that the individual bargains made under such a treaty, or under what is called a one-sided Free Trade, are in themselves one-sided and unfair, and that in the deal- ings between the merchants of a Free-trading nation like ourselves and those of a Protectionist or semi-Protectionist nation like the United States or France, the Protectionist tariff causes our merchants to have the worst of the bargain. But this is pure delusion, and confusion of thought. The American farmer is not enabled to drive a better bargain with the English manufacturer by reason of the Protection- ist tariff ; on the contrary, of the two he is the one more hampered by it. The relaxation of that tariff would be an immense boon to the Englishman, but it would be a still greater boon to the American. The evil of Pro- tection is not that it benefits one party to a trade bargain at the expense of the other, but that it injures both, and prevents trade bargains from being made. Tax on American Agriculture would drive America into Manu- facturing competi- tion. CHAPTER XIV. EFFECTS OF AN ENGLISH TAX ON AMERICAN CORN ON AMERICAN COMPETITION WITH ENGLISH MANUFACTURES. But let us follow the consequences of a tax on American food a little farther. America has an abundant supply of the most energetic and versatile labour in the world, and also an abundant supply of capital. At ]:)rescnt this labour and capital are largely employed in providing Europe, and England especially, with food, because that is the most Vnohtablc way in which American labour and capital can be employed. But we are asked to make this employment less profitable for her, and to deprive her of her present market for her enormous agricultural produce. What would be the natural result of such a step ? Why, to divert her energy and capital from providing the food we want to buy from her, and to drive it into providing the manufactures PART I. — NEW COLONIAL POLICY. Ill which we want to sell to her. At present, in spite of, possibly in consequence of, her system of Protection, the sale of her highly forced and highly priced manufactures is in a great measure confined, or nearly confined, to her own subjects, and she is no rival to England in our own markets, or in the markets of the world ; whilst even in her own markets our manufacturers compete with hers. In 1880 we exported to hei 245 millions of manufactures, and imported from her 2| millions. Out of her total ex- ports about 10 per cent, are manufactures, and go per cent, food and raw materials, chiefly agricultural produce.* But if we deprive her of her market for agricultural produce, we shall drive her into manufacture, and there is no sajdng how formidable a rival she may become. Though in 1902 food and raw materials still constituted ;^io8, 000,000 of ;ri26,ooo,ooo imports from the United States, American exports of manufactures have lately greatly increased, partly owing to natural development, partly owing to the high tariff which enables American manufacturers to charge exorbitant prices at home, and sell cheap at the expense of their own people abroad. But even the great Trusts cannot continuously screw enough out of Americans to persist in selling their goods below cost to foreigners in the expectation of killing com- petition and building up a trade, as it is hoped by tbcm and feared by British alarmists that they will do. Imports of unwrought steel from America have greatly declined, and the common stock of the great Steel Trust, with a capital of ;^30o,ooo,ooo, is cjuoted at 80 ])cr cent, discount. American goods, which need protection in their own market against British goods, cannot possibly continue to undersell those goods in the British market. If they could be produced cheaper they would not require [protection in their own market, and if without protection they can be honestly produced cheaper than British goods, why rail against a tariff which does not affect the matter? From a Protectionist point of view, in fact, the logical policy would be to impose duties, not against those articles on which foreigners by pro- tecting them admit that they fear our competition, but against those which foreign countries can produce cheaper than ourselves, and with which, accordingly, they might " flood our markets." At the time of the repeal of the Navigation Laws, all the best judges thought that the carrying trade of the world must pass into the hands of the Americans. It has passed * The proportion of manufactured articles has slightly increased since 1S80, 112 FREE TRADE V. FAIR TRADE. into our own, as is shown fully below (Cha])ter XLVL). There are probably several causes for this ; but the most important to my mind is that America has found in her internal development, and especially in her farming, and in the railways which farming creates and sustains, an in- dustry more profitable to herself and to the world than the ocean carrying trade. To us the ocean carrying trade has been the more profitable employment. She has done the farming, and we have done the ocean canying, to the great advantage of both. If we cripple her farming, there is no saying that she may not take from us our ocean carrying. If America owes us money she must repay, or pay intercit, whether \vc buy her corn or not. CHAPTER XV. OBJECTION THAT WE ARE PAYING FOR AMERICAN CORN BY RECEIVING BACK PRINCIPAL OF INVESTMENTS. "But," say the Fair Traders, " granting " that America must be paid in some way for the food she sends us, she is paid, not in goods, but by setting against it the loans we have made lier. In this way she is not only paying interest upon them, but is repaying to us our capital, upon which consecpicntly we are living." The latter assum])tion — viz. that America is sending back capital to us — is utterly without proof, and is probably false.* The statement that she sends us food in payment of interest on what we have lent her is to a great extent true. But I am not concerned at ]MX'sent with the truth or falsehood of these statements ; 1 only mention them for the })urpose of showing that they arc nihil ad rem. If America owes us money, which, or the interest on which, she is now repaying in corn, she will equally owe us this money if wc transfer our custom for corn to Canada, and if she does not repay us in corn, she must repay us in something else. That something else will be something which, ex hypothesi, we want less than com ; ♦ .See below, Chapter XXIII. PART 1. — NEW COLONIAL POLICY. Il3 it may, as I have pointed out, be manufactures or freight, which will compete with our own. And here I have to notice a so-called argument, which I was at first disposed to pass over as too absurd to be refuted, but which has been so often repeated that it calls for a passing notice. It has been stated in the following terms : — " But even if it could be proved, as it certainly cannot, that all this enormous disproportion of imports has been paid for out of our income, and without any diminution of our investments, that would still do nothing Absurdity to reassure our working classes as regards the interests of °[j"i^|^\°^' labour. They are concerned in the acquisition of imports interest on of food in exchange for the production of their industry, Foreig:i rather than in payment of income due to us, from our n^^^n only foreign investments. For, suppose such investments to be supplies increased fivefold ; suppose England to contain multitudes |}Jg"r?di *° of well-to-do people who owned them, and lived upon the income paid to them, let us say in the shape of food from America, and clothing, furniture, and luxuries from France ; is it not evident that the balance of trade might be satisfactorily accounted for by financiers, while our agriculture and manufactures are alike languishing, and every year affording less employment, and at lower wages, to fewer workmen ? English land might be forced out of cul- tivation by American competition, or turned from arable to grass to such an extent as to more than half depopulate our rural districts and country towns, and drive the people into the larger cities and manufacturing districts, or to emigration. The demand for manufactures in the agricul- tural districts would thus be seriously reduced, whilst the free import of French manufactures and luxuries — preferred by the ever-increasing class who lived on foreign incomes — would curtail the employment of our artisans, whose wages would be still further reduced by the competition of the displaced agricultural labourers. " In one word, our imports would be acquired more and more in payment of interest or rents due from abroad to owners of foreign investments living in this country, and less and less in exchange for the handiwork of our industrial classes, and so the former would increase whilst the latter would be driven first to lower wages and diminished com- I 114 FREE TRADE FAIR TRADE. forts, then to destitution, and finally to emigration without resources and under the most painful conditions." I find it really difficult to understand this. What is it that we are importing as interest on our investments, especially from America ? Food and raw materials con- stitute nine-tenths of our imports. How do the Fair Traders suppose that these aie consumed ? How much of them do they think the wealthy and the idle put into their own stomachs or on their own backs ? And of the manu- factures imported, how many are used by the working classes ? Let anyone cast his eye down the list of British imports, and he will see that there is not one of the articles mentioned in the list which is not either an article to be used in our own industries, or an article to be used by those employed in our industries. Silk, woollen, and cotton manufactures, gloves, dressed skins, and wine are almost the only articles in our list of imports which are not simple articles of food or materials of manufacture. Assuming, which is a preposterous assumption, that the whole of these are articles of luxury, neither used by nor giving employ- ment to the working class, how much do they amount to ? To about 25 millions out of 410 millions of imports. The question thus raised by the Fair Traders is not, it must be remembered, a question of whether these imports are spent on reproductive employment, but a question of whether they are used by workers or by idlers. If the Fair Traders are right, they are used by idlers ; and our workers are to be driven to destitution and emigration b}^ the loss of wages and employment. Now, even if employed in un- productive labour, they will not be employed in support of idleness. But can it be doubted that the great bulk of these enormous imports is employed in supporting repro- ductive labour ? Every pound pi raw material, every article which rec^uires further labour to complete it, is imported for the purpose of employing labour u])on it. The food, the clothing, the common luxuries, tea, coffee, tobacco, sugar, are consumed in suj^porting and making tolerable the lives of millions of artisans in our factories, of labourers in our fields, of workmen who arc erecting, extending, and improving our railways, our docks, our mines, our shijis, our dwellings, our shops, our schools, our PART I. — NEW COLONIAL POLICY. II5 churches, our towns. They are employed in extending our reproductive powers, and in making hfe comparatively healthy and pleasant, not for the wealthy few, but for the toiling many. The contrast between wealth and poverty is sad enough, and the excesses of luxury are lamentable. But the proportion of our national income or of our imports which is consumed in luxuries is a mere trifle compared with that which goes to support useful labour. The fear that the payments which foreign countries are now making us as a reward for former labour will make us poorer and render future labour unproductive, is the wildest of many wild chimeras. The very contrary is notoriously the case. The recent The recent depression in lousiness has been markedly distinguished from u'^'^',^? 'u° earlier commercial depressions by the fact that it has nch and affected profits far more, and more quickly, than it has spared the affected employment, wages, or the well-being of the work- ^°°'^' ing classes. Millowners, coalowners, ironmasters, land- owners, and farmers have suffered more or less severely. But the mill-hand, the miner, the workman, the labourer, until a very recent period, suffered, and are even now suffer- ing, comparatively little, as is shown by a comparison of the state of the country with its state at former periods of depression, and by the infallible tests of pauperism and of consumption. Capital has borne the brunt of the blow. By the simple expedient of leaving things alone, and re- ])ealing the wicked and pernicious laws which made scarce the food of man and curtailed the rights of labour, we have advanced one step towards the millennium of the economist, the politician, and the Christian philanthro- pist — viz. the more equal distribution of good things. The workmen arc better off than they were, and, as the action of their Trades Unions, and the speeches and votes of their representatives in Parliament show, they know the reason why. But even if investments abroad were the evil the Fair ^["^j^^*"' '^' Traders imagine them to be, the transfer of our custom from colonies' foreign countries to tlie Colonies would do little to remove «iii not it. For wc are now xmsiing (as the Fair Traders would vest^,nenlr' say) our surplus earnings largely in the Colonies ; we are abroad. lending to Australia and Canada as we have in former years Il6 FRFE TRADE 7'. FAIR TRADE. lent to the United States. Our investments in Canada and the Australian Colonies are said to amount to between 300 and 400 millions ; and our investments in Australia are said to be increasing at the rate of more than 10 millions a year, a fact which accounts for the increase of exports to those Colonies. Our loans to the Colonies in 1884 are said to have amounted to over 30 millions,* and to 31 millions in 1885. But the time must soon come when those Colonies will be doing as much to ruin us by paying us interest in the shape of imports as, in the opinion of the Fair Traders, the United States are now doing, and then what is to become of us ? If such a conclusion drives the Fair Traders to despair, it is some consolation to think that it will carry comfort to the heart of another great Imperialist, Sir Julius Vogel, who also would like to see us exercise a large control over the Colonies, but who wishes us to do so in order, ifiier alia, to encourage those investments of English capital in them which are the terror pf the Fair Traders. Later figures as to investmenis in the Colonies give ;^387, 000,000 for Australia alone. As to the fear of imports diminishing wages, the facts show that, while the excess of imports has greatly increased since 1884, wages have since that time reached their highest point in our history, and are now much higher than they were at any time in the eighties. Ihe precise effect of foreign investments on our own industries I have dealt with more fullv below (see Chapter XXIV.). CHAPTER XVI. TARIFF BARGAINS WITH THE COLONIES. ARE THEY POSSIBLE ? To do so We have hitherto considered the effect of a differential tax we must Qj^ foreign articles of food pure and simple, and without dutieTon reference to any reciprocal benefit to be derived from action ourselves, to bc taken by the Colonics. But it is possible, for the lan- out'ofthe guage of the Fair Traders is very vague, that they intend qucsdon. » StdniiarJ, 30th December. 1884. PART I. — NEW COLONIAL POLICY. II7 Colonial articles of food to be admitted free only from those Colonies and possessions which admit our manufactures free, and that they propose to make the differential duty a means for driving a tariff bargain with the Colonies. If so, an important question of principle arises — viz. whether it can be worth our while at any time, or under any cir- cumstances, to impose a duty on imports, which will do us an immediate injury, in order that we may have a weapon wherewith to fight foreign countries or British Colonies in making tariff bargains. This question is raised explicitly b}' the further proposal of the Fair Traders to tax foreign manufactures, and I propose to consider it when dealing with that proposal in the Second Part of this work. If it is to be answered in the negative, as I am sure that it is, the })roposal to drive a tariff bargain with the Colonies by the bribe of a differential duty on their competitors must fail at once. But I do not intend to argue this large ques- tion here, and will assume that it may be answered in the affirmative. Making this assumption, let us think what sort of bargains we can possibly drive with the Cotonies, and let us consider, first, what we must give them and what we can get from them ; and then, secondly, what they must give to us and what they can get from us by such a bargain. First of all, then, as our foreign food supply is to be But if we transferred to the Colonies, and as they now only supply us should we with one-sixth of it, we must cut off five-sixths of out pre- have to sent sources of supi)ly, and trust to their being made up by 8'^^'- countries which now only furnish one-sixth of it. What the effect of this may be on the quantity and price of food and the welfare of the i)eople it is frightful to consider. The Colonies now supply ;^49*6 millions of our food supply. Wc buy ;^l867 millions' worth from foreign countries. Secondly, we shall lose the whole of the custom for our own produce arising out of purchases of food in foreign countries, and, as they amount to more than 140 millions a year, this is a scarcely less serious consideration. Thirdly, we shall cripple our powers of production by making food dear, and be less able to compete for custom in neutral markets. Fourthly, we shall run a very serious risk oi retaliation Il8 FREE TRADE V. FAIR TRADE. by toieign countries. If we say to France, or to America, " We will not buy corn, or meat, or butter, or cheese, or eggs from you," they will retort by refusing to buy cotton, wool, silk, and iron from us ; not only shall we ourselves cut off a very large proportion of our foreign exports, but we shall tempt foreign nations to cut off the remainder. Taking the average of the last nineteen ^^ears, our trade with foreign countries has been about three-fourths of our whole trade, and our trade with British Colonies and possessions has been about one-fourth of it. Our whole trade, imports and exports included, is 700 millions a year. We are, therefore, asked to cripple and endanger three-fourths of this, or a trade of more than 500 millions a year. Our trade for 1902 was £8'J7'6 millions, x^6$y^ millions of it with foreign countries. It is conceivable that America might retaliate, and inflict irre- vocable disaster on us by imposing an export duty on raw cotton going to this country, and throwing our cotton manufacturing trade into the hands of Germany and Belgium. That, however, would require an alteration of the Constitution. Retaliation in the shape of differential railway rates on Canadian corn, perhaps a refusal to allow its export through American ports when Canadian ports are ice-bound, would be comparatively simple. What are we to get in exchange ? First, we shall get so much custom for our goods in the Colonies as arises from the additional purchases of food we make in the Colonies. But, as the Colonial su})ply of food will be much less than that wliich we now get from foreign countries, and as its price will be much higher, this market must be much less valuable than that which we give uj). So far, therefore, we are large and pure losers. But we shall get, in addition, whatever advantage is to be gained by the reduction our Colonics may make in their tariffs in return for what we do for them. What will this amount to ? Now, in the first i:»lace we may eliminate India. 'Ihe Indian tariff we practically make ourselves. We have determined, rightly or wrongly, that she shall not levy duties on our manufactures. Her consent is not asked ; we get '. PART I. — NEW COLONIAL POLICY. IIQ we need no bargain for the purpose. We may, for similar Tariff bar- reasons, eliminate all the Crown Colonies. In short, the f^oionjes!' only Colonies with which we can make bargains are the What self-governing Colonies in British North America, in Aus- f^^^j'"'^, tralasia, South Africa, and some of those in the West Indies. But of these there are many which now levy very small duties on our manufactures, and those by way of Revenue rather than of Protective duties. With regard to these, all that we can expect to get by way of a bargain is that their duties shall not be raised, and this is a prospective and contingent, not a present and certain, benefit. In fact, the only Colonies in which any large reduction of duties is possible are Canada, Victoria, Western and South Australia, Queensland, Tasmania, and New Zealand. New South Wales, one of the most important of the Australian grou}), is free, or nearly so, already. But let us take the whole of our Colonies in British North America, in Australia, and in South Africa, and suppose that throughout them all it were possible to get a reduction of duties, what would this advantage amount to ? The trade of the United Kingdom with the whole of these Colonies, taking, as before, an average of nineteen years, is about lo per cent, of our whole external trade ; not much more than our trade with Germany ; not so much as our trade with France ; little more than half as much as our trade with the United States ; about one-eighth of our whole trade with foreign countries. If we take those Colonies alone which now levy considerable duties, the trade with them will not be more than one-half this amount. Consequently, it is only about 5 i)er cent, of our whole trade for which we can expect any su])stantial benefit by a tariff bargain with our Colonies, whilst the trade which we shall injure and cripple by such a bargain is 75 per cent, of that trade. New South Wales is now embraced in the Protectionist Common- wealth. The figures have changed a little, but not in such a manner as to affect the argument, and the Canadian experiment has demon- stated the small effect of preferential tariffs. I think we may, then, draw two conclusions: that it is not worth oiu" while to make any such bargains ; and, secondly, that if we were to make any such bargains, it 120 FREE TRADE V. FAIR TRADE. would be madness to adhere to them, if foreign countries were to offer to reduce their tariffs on condition of our re- ]-)eahng the differential dues on their produce which such a bargain implies. This is not, however, the view of some of our Colonial reformers. For instance, a writer, signing himself " Im- perialist," in the April number of the National Review for 1885, urges that a leading feature of the Conservative polic}' of the future should be "to tax foreign imports, while granting free admission to Colonial products of all kinds " ; and a similar proposal is advocated by Mr. Thomas Gibson Bowles in the May number of the Fort- nightly Review. Mr. Stephen Bourne, the well-known statistician of the Customs, in his address at Montreal, goes much further, for, after showing how Canada declines the business of the Mother Country, he proposes that we shall deprive ourselves altogether of trade with Protectionist countries in order to encourage Colonies which discourage us, and that Canada shall in like manner deprive herself of trade with her nearest neighbour ! The writer of the article " England and her Colonies," in the April number of the Quarterly for 1885, is more alive to the difficulties of this question ; but even he, after dis- missing as imi)ractical)le Mr. Forstcr's notion of an " Im- ])erial Zollverein on the basis of this abolition of all cus- toms or excise except upon intoxicating liquors or tobacco," l)ecause the Colonies would not agree to it, suggests that Lord George Bentinck's plan of " taxing foreign jiroduce while admitting Colonial wool and other materials duty free," is the only basis on which we can build any reason- able expectation of constructing an Im))erial Zollverein. In the last century w'c alienated our Colonies from the Mother Country by taxing them. In this century our Colonial reformers wish to alienate the Mother Country by making her tax herself. They seek to bind our Colonies to us by leaving them free to tax our products, whilst we are not only to abstain from taxing theirs, but are to burden ourselves with the worst of taxes in order to give them an exclusive monojwly of oiu" markets. Surely, if there is a policy which could make the Mother Country hate her Colonies, it is this ! PART I. — NEW COLONIAL POLICY. 121 Now let US look at such a bargain as I have described What above from the Colonial point of view. What would they gain and what would they lose ? I think we must admit that if England gave them the monopoly of her market for food they would gain considerably. Canada, Australia, and India would send us much more com if United States and Russian corn were excluded from our ports. India would send us more tea if China were out of the market, and the Cape and Australia would send us more second-class wine if we could not get good wine from France or Spain. Even this would not be an unqualified advantage to them. The production of the world would be diminished, and they would beai some share of the loss ; their people would be diverted from doing what they can do best, to the providing of those things which the Enghsh market demands, and India certainly would lose some of the trade which, as we have seen, she now does directly or indirectly with the United States. But it is idle to talk of such pro- l)osals as these. England certainly will not contract her sources of supply to such an extent. Nor will she make a sacrifice at all where she gets nothing in return. She can only get a return from those Colonics which now impose restrictions on the imj^ort of English goods. We may therefore, as before, eliminate India and other Colonies or l)ossessions which are governed from home. The only Colonies which can make a bargain arc the self-governing Colonies, and amongst them those only which now levy duties on English goods. That they might gain something immediately by the bargain, I have admitted. What will they have to give up ? First of all, there are those Colonies which only levy a small duty, say 5 to 10 i)er cent., with the boHii fide object of raising revenue, and without any thought of Protection. To these Colonies, with but little realised property, and with an organisation very different from that of an old country, it would probably be a very serious financial difficulty to raise a revenue in any other way — a difficulty which might in itself counterbalance any gain they might derive from our differential tariff. Those Colonies, again, such as Canada and Victoria, which levy heavier duties, and which levy them avowedly for purposes of Protection, would have to make a serious surrender. would the Colonies get? What would they give ? 122 FREE TRADE 7'. FAIR TRADE. Tariff" bar- gains with Colonies. What would be iheposiiion of the Colonies when the bargain is made ? They would, in the opinion of Free Traders, be really benefiting themselves by reducing their tariff in our favour ; but in their own opinion, and in the opinion of the Fair Traders, they would be doing themselves harm. They might be tempted to do it, but in doing it they would feel they had made a concession to us, and we should be obliged to accept it as a concession. It is hard to see what concessions the United Kingdom could give Australian protectionists in return for admission of British goods at rates allowing competition with their own. The manufacturers know that Protection raises prices ; Protectionist working men believe it raises wages, and why should the politically strongest section of the people abandon the policy they believe essential to prosperity in order to lei farmers and wool growers reap higher prices? The question is emphasised by the fact that the)-, the manufacturers and the workmen, must pay these higher prices. The price of wheat in Australia after an ordinary harvest is fixed by the price in London ; it is, in fact, the London price less carriage. Thus a rise in cost of food to the British consumer involves also a rise in price to the Protectionist working man of Australia. He believes, and Mr. Chamberlain tells him, that Protection raises wages, and therefore the great champion of preferential tariffs should not expect the Australian working man to fall upon his neck when he asks the working iran to reduce Australian pro- tective duties and iower his wages in return for the imposition of English protective duties, which will raise the prices he has to pay. There is not the slightest doubt that for years to come a duty which makes bread dearer in London will make it dearer in Melbourne also. But suppose the concession made and the bargain com- pleted. Suppose that we have excluded the United States corn from our market, and that Canada has admitted Eng- lish goods freely to her market, what will be the condition of things ? The United States may leave things alone. In that case, as I have shown above, England will find herself suffering from insufficient supplies, from a contracted market for her goods, and from the new competition in manufactures which she will have forced upon the United States. She will be discontented and disgusted with her bargain, and with the other jxirt}' to it. Or the United States may retaliate ])y proliihiting English goods. In that case England will bo still nvnv discontented aiid dis- gusted. Or the United States may do that which it nuisf PART I. — NEW COLONIAL POLICY. I23 be the desire and object of every honest Fair Trader and Tariff bar- Reciprocitarian to make them do — they may offer to throw colonies, open their market to EngUsh goods on condition that Ultimate England will again throw open her market to United States ''esuHs. corn. In that case England will be more than ever dis- gusted if her bargain with Canada prevents her from accepting their offer. Indeed, it is scarcely within the limits of possibility that such a bargain could under such circumstances be kept. That England, which now does a trade of 140 millions a year with the United States, even under the present Protectionist tariff, and of 21 millions with Canada, should refuse the proffered trade of a country which has between 50 and 60 millions of ])eople and the finest soils and climates in the world, for the purpose of nursing a trade with a country which has between four and five millions of people and a far inferior soil and climate is too much to expect of human nature. And if the bargain is not kept, or if the terms of the bargain with Canada are - such as to allow England to accept the United States' offer, what will be the position of Canada when she is thro\vn over and the United States are again admitted to free competition in the English market ? She will have been misled into an unnatural course of industry and expendi- ture, and she will be left to her own resources when it suits the convenience of England so to leave her. The Fair Traders have some hazy inkling of this difficulty, for they propose that the fixed duties on foreign food are to be steadily maintained for a term long enough to develop our own instead of foreign territories. But do they really think that this is possible ; that our own people would submit to years of privation in order to develop a possible future in Canada or Australia when that privation might be at once changed into plenty by admitting foreign pro- duce ? Are any such arrangements as these likely to stand ? Putting aside mere commercial interests, are they desirable in the true interests of Imperial union ? Are they likely in the end to promote that good feeling between England and Canada which it is the professed object of all of us to encourage ? Arc they not much more likely to cause estrangement, recalcitration. and disruption ? To such questions there can be but one answer. We may 124 FREE TRADE V. FAIR TRADE. Tariff bar- gains with Colonies. Any forced attempt at Union must lead to Disunion. be quite certain that any forced attempt at unnatural union, any unbusiness-like sacrifice of interest to sentiment, will only destroy those feelings of kindness which it is the object of all to promote. I have taken the case of Canada as the most striking illustration of the fatal difficulties which would attend any such tariff bargain as we have been considering. Similar arguments apply to the other self-governing Colonies, and it is unnecessary to repeat them. It seems to me abun- dantly clear that no tariff bargain with anj' Colony which has for its condition a differential tax on foreign produce imported into England is for a moment to be thought of. Can we make Com- mercial 'I'reatici with Colonies, such as the h'rench Treaty ? Narrow limits within which such Treaties would be applicable. CHAPTER XVII. COMMERCIAL TREATIES WITH THE COLONIES. ARE THEY POSSIBLE ? A Customs union of the Empire is then impracticable. An attempt at a closer connection with the Colonies, to be effected by imposing differential taxes on foreign produce, is not to the real interest either of England or, in the end, of the Colonies, and it is much more likely to lead to separation than to union. There is yet a third method of improving commercial relations with the Colonies, which is scarcely suggested in the Fair Trade ]n'ogrammc, but which may deserve a few moments' consideration. It is that of a commercial treaty such as wc have made with France and other foreign nations ; a treaty in which we im})ose no differential duties, but only reduce our own duties, and reduce them for all equally. Here, again, we may at once dismiss from consideration all the Colonies or possessions which are jjractically gov- erned from home ; and these, including India, will, so far as trade is concerned, be found to amount to one-half of the whole. PART I. — NEW COLONIAL POLICY. 125 Our whole trade with our Colonies is, as I have shown above, about one-fourth of our whole trade, and it is there- fore only one-eighth of our whole trade that can possibly be affected by such a treaty. Practically it is much less ; because we do not want commercial tieaties, or, indeed, alterations of any kind, except with those Colonies which levy sensible duties on our goods. The whole affair is, there- fore, of less moment to us than it might at first appear. Now, with respect to the self-governing Colonies, we have, in giving them self-government, left them free to impose what duties they please, with one restriction — viz. that they shall not make their duties differential ; that they shall, if they place Customs duties on the produce of one country, place the same duties on the produce of all. But even this restriction has been surrendered on two special occasions. Canada, or rather the British Colonies in North America, were in 1854 allowed to make a Re- ciprocity treaty with the United States,* by which a large number of articles, the produce of Canada and of the United States respectively, were admitted duty free into each of those countries, although the same goods remained subject to duty when imported into those Colonies from the United Kingdom, or from foreign countries other than the United States. The denunciation of this treaty by the United States was one of the causes that led to the l)rcsent Protectionist tariff in Canada ; and the resumption l)y the United States of the policy which dictated that treaty would, no doubt, lead to the resumption of a similar l)olicy by Canada. Another case, rather less striking, be- cause it was between different Colonies and not between a Colony and a foreign nation, was that of an arrangement between New South Wales and Victoria concerning the Customs duties levied on the boundary between the two Colonies in the basin of the river Murray. In these cases, the jninciple of equal treatment gave way to the still more important jninciple of self-government, and to the demands for freedom caused by local contiguity. And, no doubt, a similar course must and will be followed when similar cases occur again, as they are sure to do. Even at this moment, proposals having this tendency are being * Treaty ratified 9th September, 1854. Com- mercial Treaties with Colonies. No reason against such Tieaties in existing Imperial relations, for the self- governing Colonies are inde- pendent. 126 FREE TRADE 7'. FAIR TRADE. discussed in Australia, and in the case of the British West Indies. It may be all very well to say, as a matter of theory, that when nations are divided by great natural barriers, such as hundreds of leagues of sea or mountain, there is all the more reason for abolishing artificial bairiers. But this is not the way in which the facts present them- selves to the ordinary mind. I feel the need of dealing freely with my neighbour across the street long before I understand that the same need exists for freedom in my dealings with an alien in China. It was by the obvious absurdity of an artificial barrier between Surrey and Middlesex that Cobden brought home to men's minds the much less obvious absurdity of an artificial barrier between England and France. If, therefore, any strong case arises again, such as an approach to commercial union between Canada and the United States, or between any of the Australian Colonies and their neighbours, we may take it for granted that the one principle of equal treatment, which we have hitherto maintained, will give way, and that in this, as in other matters of taxation, the Colonies will exercise and enjoy complete self-government. In short, the Colonies in question are, so far as tariffs are concerned, in as free and independent a position as foreign nations ; and if we are to make commercial treaties with foreign nations, there seems to be no prima facie reason why we should not make similar commercial treaties with our self-governing Colonies. In making such treaties we should, of course, be governed by the same rules as have governed us in making treaties with foreign countries. We should give no such differential treatment as is suggested by the Fair Traders, and we should make no reductions of duties which we do not consider to be for our own advantage. Since the above was written, the Australian Colonies have federated, with Free Trade amongst themselves. Protection against the outside world ; and Canada and South Africa have given preferential tarifl treatment to the United Kingdom, the latter event being the occasion of a new and curious claim — namely, that the Colonies enjoy absolute independence in tariff matters, and yet must not suffer the penalties of that independence in their dealings wiih foreign countries. This is the only basis of tlie objection raised against Germany for depriving Canada of the mostfavoured-nation treatment when the Dominion, PART I. — NEW COLONIAL POLICY. 127 which Germany had always understcod to be fiscally autonomous and self-contained, gave advantages to the goods of the Mother Country which were denied to her own. On behalf of the present Government thire has been express repudiation of the suggestion that ihe United Kingdom might make special treaties with the Colonies, under which the produce of those Colonies which gave the United Kingdom no jirefeitnce would be subjected to duties. The question then arises whether there are any duties g^ ^^e which we now levy on Colonial produce which we could there any reduce ; remembering that if we reduce them for the ^Q,Q^la°" Colonies we must reduce them for other countries also. Produce Now, what are the products of the self-governing Colonies which we which we tax ? The only articles of this description in ^p" ^'^'^ our tariff are cocoa, coffee, chicory, dried fruit, tea, tobacco, wine, beer, and spirits. The exports of these articles from the Colonies are as shown below. For the tables given in the last edition tlie following for the year 1902 have been substituted : — In Thoisands. l-KUiTS.* Nuts, I IIOCllLATi;, India Ceylon Australia and New Zealand . . Channel Islands .. Cape of (jood Hope and Natal British North America .. British West Indies British (juiana Other I>iitish Possessions osed of, we have already done all that we eaii to elear the way on our side. It is for the Colonies to j^lay their part. Many of them are doing so fairly enough. The others will do so when they feel it to be their interest, without being specially bribed. It is not in our power to do more. Nor is this to be wondered at, when we consider that all which a Government can really do for trade and manufacture is not to impede it. All that Fair Traders and Protectionists are urging as to the duty of Governments in providing markets for their peoj)le, and other nonsense of a like kind, really means, when it comes to be sifted, that Governments are to check and prevent trade under ])retence of guiding it ; that they are not to allow merchants and manufacturers to do that which it is their interest to do. Such a course it is con- trary to our commercial interests to enter upon, and it is much more likely to weaken than to strengthen the political connections of the differcnts parts of the Empire. ;^ENC, ?3 NOV.1320 133 PART II. RETALIATION. CHAPTER XVIII. RETALIATION ON MANUFACTURED GOODS ABSURD. The second of the two great principles of the Fair Traders English is Retahation. They desire to impose retaHatory duties ^n Foreign on the goods of foreign countries which do not admit our Manufac- goods duty free. inrotent These duties are not to apply to our food imports, which ^^^^ ^^ have been dealt with already, nor to imports of raw material, Suicidal, but to manufactures only. It is a sufficient, practical answer to a proposal of this kind that the weapon is in our hands absolutely inefficacious. Of our imports, 90 per cent, are estimated to be raw materials or food, and 10 per cent, only what are called manufactured articles. If we take particular nations, the case is stronger. Our trade with the United States is one-sixth of our whole trade, and their tariff is the most hostile of any ; whilst the interest which is affected by their competition is our most suffering interest. But out of their imports into the United Kingdom — which exceeded 100 millions in 1880 — about 2\ millions only were manufactures ; whilst out of our exports to them 242 millions were manufactures. Will they not laugli at us ? Or, if not disposed to laugh, will they not treat us as they have treated the Canadians, and ))lace still further obstacles on our imports ? To France we exported in 1880 upwards of 12 millions' worth of manufactured and half-manufactured goods ; 2.V millions' worth of raw material ; and one million's worth of food. From France we imported 23 millions' worth of manufactured and half-manufactured goods, 3 millions' worth of raw materials, and nearly 15.^ millions' worth of food. Here tliere is more to retaliate ni'on than in the case 134 FREE TRADE V. FAIR TRADE. of the United States, but the proportion of manufactures which we send to France is greater than the proportion which she sends to us. We send her httlc but manu- factures, w'hilst she supphes us largely with food. To Germany we exported in 1880 nearly 14 millions' w'orth of manufactured and half-manufactured goods, less than 2 millions' worth of raw materials, and less than li millions' worth of food. From Germany we imported in 1880 a little over 41^ millions' worth of manufactured goods, 3^ millions' worth of raw materials, and 16:^ millions' worth of food. If we are to play a game at who can do most to stop each other's manufactures, it is clear that Germany will have the best of the match. What is true of these countries is true of others. We are par excellence the manufacturing country, and for us to play the game of who can best destroy manu- facturing industry is simply suicide. Of our imports in 1902 79*9 per cent, were raw materials and food ; 20'i per cent, manufactured articles, a great proportion of the latter being really raw material of other industries. To the United States we exported 18 '6 millions' worth of manufactured articles, and imported thence ii'l millions. To France, in 1902, we exported, of manufactured goods, 9*4 millions' worth; raw material, 5*8 millions; food, -4 millions. From France we took, of manufactured goods, 31 "O millions' worth; of raw material, 5*9 millions' worth ; of food, 147 millions' worth. To Germany we exported in 1902, of manufactured goods, i6"i millions' worth ; of raw material, 46 millions' worth ; of food, 2"i millions' worth. Our corresponding exports from Germany were, of manufactures, 1^6 millions' worth; of raw material, 5"8 millions' worth ; and 14*2 millions' worth of food. It will thus be seen that our imports of manufactures have increased — an inevitable thing if we are to trade at all, as the people cannot consume more than a certain amount of food ; and we cannot expect, when we sell metals and machinery to other countries, that they will not put them to use in producing manufactured goods. What would be our fate under a Protectionist rigime which would shut out foreign food in order that we might grow our own, and at the same time would retaliate against foreign manufactures, is hard to imagine. We might give our exports away, but there would seem little chance of our being paid for them. Great as has been the increase of our imports of manufactures, a Board of Trade memorandum of 1902, dealing with the years ending PART II. — RETALIATION. 135 1900, sums up the matter in a way which shows that even the most timid need not be alarmed : — " On the whole, the conclusion from this part of tlie investigation is that, in spite of the strides made l>y Germany and the United States in recent years, we still preponderate greatly as a country manu- facturing for export. Both Germany and the United States have largely developed in capacity to manufacture, not only in their home markets, but for export also, and even France has made some gains. Our exports, however, consist more largely of manufactured goods in proportion to our whole exports than do those of France and the United States, but we are run very close by Germany in this respect. Nevertheless, measuring per head of the population, we are, as we have already seen, far ahead of Germany or any other of our com» petitors." CHAPTER XIX. PROPOSAL TO TAX MANUFACTURES AND LEAVE " R.\W MATERIAL " FREE — DIFFICULTY OF THE DISTINCTION. But when we are told that raw material must be admitted is the free, and that manufactures are to be taxed, I should like ^^f'^^^. Policy of tq^ask what distinction can be drawn between these two distin- classes of goods which would justify a different treatment ? guishing When I look down the list of so-called raw materials, I see r-Iw^^" nothing which is not both the produce of some previous labor Materials and the means or material of some further labour ; and f"*? Manu- lectures when I look down the list of so-called manufactured articles, well I find the same thing. I am unable to draw any line be- founded? tween the two, or to find any principle by which to distin- guish them. If the quantity of labour employed in producing the article is to be the test, the labour employed to produce so- called raw materials may, and often does, far exceed the labour necessary to turn that raw material into a manu- factured article. There may be more labour in getting coal, or in gi^owing wool, than in spinning or weaving. If we are to be guided by the operation of the article as a means or a stimulus towards further production, I am un- able to sec how the raw produce of the soil operates for 136 FKEE TRADE 7'. FAIR TRADE. this purpose move diicelly ov more effectually than the article into which it is suhsetiuently converted by human labour. 1 do not see why the alkali out of which glass or chemicals are made is not as efficient a means of pro- duction as the salt out of which the alkali is made. Let us take any list in which an attempt has been made to dis- tinguish between raw products and manufactures. We get into difficulties at once. The alkali, for instance, to which 1 have referred, heads one list of manufactured articles, but it is chiefly useful as a material to be employed in subsequent manufactures. " Apparel and haberdashery," which come next, are, no doubt, manufactures as complete as it is possible to conceive ; but even here the boots of the navvy, the shirt and apron of the operative, the blouse of the French labourer, the jersey of the sailor, or even the neat cloth coat and shirt of the clerk or manager, are as much the means and essential conditions of further pro- duction as the stone, the iron, or the wool which these persons are employed in manipulating or disposing of. Horses come first in one list of " raw produce," but a farm horse is at once the final product of skill in breeding for generations, and is a direct instrument in further pro- duction. " Clocks " come first in another list of manu- factured articles, and there is certainly no more finished article of human ingenuity than a clock ; but is not a clock the sine qwt non of every place where productive labour is at work ? Is it not the great economist of time, which is the principal of all factors in production ? I might go through the list in the same way, pointing out how each article of large or general use is, on the one hand, the result of previous labour, and the means for further labour. Nay, the same thing is true of food also. Food is the means of keeping the human machine going, without which there can be no productive labour ; it is the most obvious, if not the most imj^ortant, of raw materials ; it is to the man and woman what the coals are to the steam-engine. We admit this when we class food and raw materials together as articles which are not to be taxed, or which are to be taxed more sparingly and cautiously than other things. But, like other raw materials, food is not really more necessary to further production than PART II. — RETALIATION. 137 otliL'i- articles of general human use. The house in which Kaw the artisan lives, the clothes which he wears, the tools SManu- which he uses, are no less means and instruments in making factures the articles which he produces for sale than the food which |q ^"^j^;'^'^ forms his blood and muscles, the coal which drives his guish. steam-engine, or the material of fibre, of wood, or of metal which he is converting into use. We may go farther, and say that the so-called luxuries, the tea, sugar, and tobacco, which make life tolerable to himself and his children, are also instruments by which his powers of production are increased. Nay, we may assert, with the most exact truth, that the wine which refreshes the brain of the man of science, the statesman, or the physician, is in the highest degree conducive to the production of wealth. All active and useful human life is one cycle of unintermitted and contemporaneous production and consumption — of pro- duction, in order to procure articles of consum})tion ; of consumption, in order the more effectually to produce. There may, of course, be useless and even mis- chievous consumi)tion of excessive or pernicious luxuries, liut these are, economically sjieaking, a trifle in the vast mass of human consumption ; and there may also be foolish and ill-directed i)roduction. But, generally speak- ing, all human consumption is a direct means of production ; and this makes me doubt whether there is any real sense in the commonly received doctrine that it is better, on economical grounds, to tax articles of consumption — that is, articles which are in a fit state to be at once eaten, woni, or otherwise used by man — than articles which he has to do something more to before he can use them. But this is, I am glad to say, a controversy on which I need not enter ; from the Fair Traders, or from some of them, I am too glad to accept the admission that raw material is not to be subject to a retaliatory duty ; and only mention the point now because, if we admit that manufactures are to be taxed, we may find it difficult to stop there. I have said, " or from some of them," because the Fair Traders are not consistent with themselves. Mr. Farrer Ecroyd, for instance, in a letter jniblished by their League, considers the free admission of raw materials necessary, and he is a man who docs not juggle with words. F)ut 138 FREE TRADE V. FAIR TRADE. Mr. Samp- son Lloyd's letters. New definition of raw material as an article which can- not be pro- duced at home ! ill a later maiufosto of the Fair Trade League, publisiicd in 1884, consisting of letters by Mr. Sampson Lloj'd and notes in illustration of them, I find that the \vi"iters arc impressed with the above arguments concerning the diffi- culty of distinguishing raw material from manufactures. What is the conclusion they draw ? Not, as one might expect, the natural conclusion, that we cannot exclude manufactures whilst admitting " raw materials," but that " raw materials " must be defined afresh, by excluding from the term " raw materials " articles used in manu- facture which can be produced at home. " Raw material " thus acquires, in the language of these writers, a meaning which will puzzle economists ; and the Fair Trader, whilst professing in terms to give our manufacturer the free import of material, refuses to allow him to use, under that designation, any foreign article used in manufacture which is produced abroad and which can also be produced at home ! This, of course, is Protection pure and simple, and helps to show what really needs no proof — that Fair Trade is but a shuffling name for Protection. Retaliation CHAPTER XX. OTHER PROPOSALS FOR RETALL\TION. Arguments The Retaliation of the Fair Trade League is, as we have infavourof seen, ridiculous from its impotency ; but this does not show that all Retaliation would be incihcient, or, if efficient, undesirable. Proposals for Retaliation, if once adopted, will not stop where the Fair Traders leave them, and there are arguments in favour of the principle of Retaliation which require a little more complete answer than is to be found in the impracticability of a given plan. I do not know that these arguments have ever been more fairly, clearly and vigorously stated than by Lord Salisbury, in his speech at Newcastle, on October 12th, 1881. He said : " I now only wish io say a word with respect to a matter PART II. — RETALIATION. 139 which, perhaps, through being exciting, occupies some con- Arguments sidcrable portion of pubUc attention at the present moment. [°[j ^j^'^^ It has been said that we of the Conservative active party are anxious to return to the state of things existing before Lord 1840 in respect to fiscal matters, and sundry terrible conse- Saiisburyat quences have been deduced from the assertion. I, for one, ■„ igsi. do not possess the desire, nor do I think that such a return would be for the public welfare ; but it does not do for the Government to ignore the commercial difficulties under which the country labours by the simple device of accusing their opponents of a desire to return to the state of things to which I have refen^ed. Whenever the evil of the present state of things is pointed out to them, they, instead of replying, call us lunatics, or beat the great tom-tom of Free Trade in order to drown our voices. It is undoubtedly the fact, and I do not think that anyone can traverse the state- ment, that in one respect the apostles of Free Trade thirty- five years ago made a gigantic miscalculation, when they said that if the country adopted their principles the rest of the nations of the world would follow their example. (Cheers.) It was repeatedly held out, both by Mr. Cobden and Sir Robert Peel, and undoubtedly it influenced many minds at the time. I am very far from stating that as their only reason. I do not mean to say that their policy would have been different if they had had a different be- lief ; but they had the belief, and took every opportunity of communicating it to others, that our example would be followed by other nations of the world. That, I take it, is an undoubted fact in history. Well, that has not been the case. The third of a century has passed by, and all the nations by which we are surrounded have not only not become more Free Trade, but on the whole have become more Protectionist. America, I believe, is more Pro- tectionist ; the Protectionist feeling is rising in France. Both of them, mind you, are complete democracies, so there is no pretence for saying that this particular form of opinion has been imposed by the ruling classes. They are countries where it is undoubtedly the sentiment of the ]ieoi)le, and nothing else, which governs the conduct of the Government : and in both these countries the feeling of Protection has increased, and is increasing. In Russia, on 140 FREE TRADE ?'. FAIR TRADE. the other hand, a despotism o( the closest tyi)e, still you have the same phenomenon. A feeling of Protection is in- creasing, and the measures of Protection are multiplying. In a kingdom like (lermany, with certain constitutional liberties, but ruled undoubtedly by the acutest brain that this century has seen in Europe, you still see this remark- able phenomenon — that the tendency towards Protection is increasing. In our own Colonies, where, if anywhere, we ought to have some influence, there too, unfortunately, the Protectionist feeling is strong, and our own productions are shut out from the markets of our own children. Now, that is a fact which I say it is idle to ignore. It is childish to imagine that our example now, after so many years, will alone have any effect upon these nations. They have their own experience ; they have their own i)hilosophers to teach them. Many of them are, and certainly believe them- selves to be, as far advanced in intellectual culture as our- selves. What is there to induce them to defer to our judg- ment, and to follow our example in this respect ? If we intend to act upon them, we must find other motives ; and I think we have a right to ask, without pledging our- selves to any opinion until the facts are known, that there should be a thorough investigation into the question whether we are now pursuing the right course for the pur- pose of inducing those other Governments in some degree to lower the terrible wall of tariffs which is shutting out the productions of our industry from the markets of the world. There is no reason that we should pledge our- selves to any particular course until the facts are known. But if you make a suggestion of this kind, you are imme- diately told, ' This is Reciprocity and Retaliation, and behind it lurks the shadow of Protection.' Reciprocity and Retaliation ! But what are these commercial treaties, if they do not involve the principle of Reciprocity ? Sir Charles Dilke will very soon meet the French Minister of Commerce, and they will be talking over the respective pro- ducts of their respective tariffs, and practically Sir Charles Dilke will say to the French Minister of Commerce, ' If you will give me this relaxation of duty upon cotton, I will give you this relaxation of duty upon wine.' But what is this but Reciprocity ? And when Sir Charles PART II. — RETALIATION. 141 Dilke finds tlial the French Minister of Commerce is diffi- cult to deal with, he will say, ' Well, but if you do not give us this duty, if you do not give us this relaxation upon cotton, I will not give you a relaxation of duty upon wine.' What is that but Retaliation ? " Therefore I say, ever since you adoj)tcd the principle of commercial treaties, ever since that memorable date, i860, the {principle of what they are pleased in their own language to term ' Reciprocity and Retaliation ' is con- ceded. " It is merely a question of policy, arising upon the state of facts in each particular case, whether 370U have the means of any alteration of your tariff which you can with due consideration for your own interests adopt, whether you can so do it in the case of the tariff of your neighbour ; and it seems to me that that is a sensible course of conduct to adopt. There is no doubt that by abandoning duties which are useful to 3'ou for revenue purposes you confer a great benefit upon foreign countries. Why should you not ask for a price in exchange for that benefit ? Why should you not obtain for your own industries a benefit corre- sponding to that which you are conferring ui)on them ? " I do not know, until intpiiry has been made and oppor- tunities gained of ascertaining whether it presses either upon the food of our people, or the raw material of our industry, both of which must be held sacred — I do not know what opportunities we may have of exercising this salutary in- fluence upon foreign Powers ; but in spite of any formula, in spite of any cry of Free Trade, if I saw that by raising a duty upon luxuries, or by threatening to raise it, I could exercise a pressure upon foreign Powers, and induce them to lower their tariffs, I should jntch orthodoxy and formulas to the winds and exercise the jiressurc." Now, if I wished to find a strong argument against all tariff bargains, I should jioint to this speech of Lord Salis- bury's. He may exaggerate the sanguine views entertained by Sir R. Peel and Mr. Cobden of the prospects of universal Free Trade ; he may also exaggerate the present tendencies of other countries to Protection ; and the Retaliation he suggests — viz. upon that inappreciable part of our imports Arguments for Re- taliation. Lord Salisbury. This argu- ment derives its strength from Com- mercial Treaties. Gazette. 142 FREE TRADE V. FAIR TRADE. which consists of hixuvies — is, unless he means to include amongst luxuries the tea, sugar, and tobacco which are the comforts of our working people — as impotent as that of the Fair Traders. But, unlike many of the Fair Traders, he states his case fairly, and he puts in very clear terms the impression which our commercial treaties have made, and are making, on many minds besides his own — an impression from which it is very difhcult to escape, especiall}^ for a dii)lomatist. Our minister at a foreign court will tell you, " Don't trouble me with your arguments ; tell me with what force you will back them." If the Foreign Secretary is to make a bargain, he must have something to bargain with. X" in the Lord Salisbury may, however, be thought by some Free Pall ^ I all Traders to be a poor economist, and a diplomatist of a very suspicious type ; but he has support where one would least expect it. I have seen arguments not very different in character in a perfectly unsuspicious quarter. In the Vail Mall Gazette of 8th and 12th August, 1881, were some letters signed X., by an ardent advocate of com- mercial treaties, in which, after pointing out, fii'st that such a treaty as Cobden's, which only reduced duties and gave no preferences, differs toto ccelo from such treaties as the Methuen Treaty, which gave a distinct preference and stipulated for the maintenance of differential duties ; and, secondly, that exports are as important a factor in trade as imports — two facts which no sound Free Trader would for a moment deny — the writer proceeded to draw the con- clusion that it is the business of the Government of this, and of every other country, to do as much for its exports as for its imports, and, after dismissing the notion of differential duties of a Protective character, suggested a differential duty on wines as a legitimate means of com- l)elling France to admit our exports. A large part of his letters consists in the exposure of the fallacy which he suj^poses the school of Ricardo to commit when they say, " Take care of the imports and the exports will take care of themselves." He points out with perfect truth that a limitation on our exports is as much a limitation on our trade as a limitation on our imports, and he implies that however free our i)orts may be to foreign imports, I'AKT II. — RETALIATION. 143 it will do us little or no good if the hostile tariffs of foreign countries continue to limit our exports. A notion similar in substance, but much more recklessly expressed, finds its utterance in the constant misrepresent- ations we have lately heard of the views and objects of the authors of our present policy. We are told that what Mr. Ricardo, Mr. Cobden, Sir Robert Peel, and others had in view as the principal object and result of their Free Trade policy, was the abolition of foreign restrictions on our exports ; that they believed themselves, and prophesied to the people, that if we in England would take off our duties, foreign nations would certainly take off theirs ; that in this they deceived and were deceived ; that foreign nations have not followed our example ; and that these short-sighted politicians, were they now with us, would at once admit their mistake and revise their policy. We have been told, for instance, by Lord Salisbury in his speech at Dumfries in 1885, that Mr. Bright, havhig raised a formidable agitation against the Corn Laws, Sir Robert Peel, rightly or wrongly, was of opinion that it was necessary for the interest of the country that that agitation should be closed, and that on this account, without waiting for any negotiations with foreign Powers, he introduced the system of Free Trade which Mr. Gladstone has carried further ; and we are told by Lord Penzance, in the Nine- teenth Century of March, 1886, that the whole fabric of free imports was rested by its framers on the conviction that foreign countries would abandon Protection. Now, what were the real facts ? The first step taken by Sir Robert Peel was his first reform of the Tariff in 1842, and in his cautious fashion he based it rather upon financial necessities than upon Free Trade principles. In doing this he had post- poned certain further reductions of duties, on account, amongst other reasons, of commercial negotiations then in progress. Thereupon Mr. Ricardo, in two successive years, 1843 and 1844,* brought forward a motion urging the immediate remission of our own duties without waiting to see what other nations would do. In the very interesting debates upon these motions, some members — amongst others Mr. Disraeli — defended the principle of Reciprocity. Sir * -Sec '* Hansard," vols. 68 of 1843, aiul y^ of 1844. Misrepre- sentation of the Orifiin of the Policy of fighting hostile Tariffs by Free Im- ports. 144 FREE TRADE 7'. FAIR TRADE. Arguments for Re- taliation. Origin of our present policy. R. Peel and Mr. Gladstone clcarl}- agreed with Mr. Ricardo in the principle he advocated — a principle on which they subsequently acted — but objected to its immediate appli- cation, and to the abstract form in which his motion was couched. Mr. Ricardo himself, Lord Grey (then Lord Howick), Mr. Ewart, Mr. C. Villiers, and Mr. Cobden, sup- ]-)orted*the motion on the ground, which was admitted on all hands to be true — viz. that for twenty-five years we had been struggling by means of our own duties to obtain reciprocal reductions from other nations, and had failed entirely, a fact which is constantly and conveniently ignored by the present advocates of Reciprocity. They said, further, that if the great object of this country were to obtain reductions in foreign tariffs, the best way to effect it would be to reduce our own, to show foreign nations that we believed in our owai principles, and to convince them by our own consequent prosperity that our policy was the true one. In their anticipations of the wisdom of foreign nations, and in their under-estimate of the strength of pro- tected interests, they were perhaps too sanguine. But this was not the only ground, or indeed the real ground, on which the}? supported the motion. That ground was the principle, true then as now, that whether foreign nations maintain their own duties or not, it is for our interest to abolish ours, and that if we would but do this in our own interest our own trade must prosper, let foreign nations do what they will. As regards Sir Robert Peel, he has himself stated his reasons for adopting a Free Trade policy in one of the finest speeches he ever made.* Mr. Disraeli had asserted that " We can only encounter the hostile tariffs of foreign countries by counterv'ailing duties " ; and Sir Robert Peel's speech was an em])liatic refutation of this doctrine, and an uncompromising defence of the opi)osite principle — viz. that you can best fight hostile tariffs by free imports — a principle u])on which his great tariff reforms were really founded. The immediate sus- pension of the Corn Laws was due, he said, to the temporary scarcity of food ; but the ultimate repeal of that, as well as of other Protection laws, he founded on principles of Free Trade — a principle which he asserted as positively, * " Hansard," 1849, vol. 106, p. 1429. PART II. — RETALIATION. I45 and defended as powerfully, as Mr. Bright, Mr. Cobden, or Mr. Ricardo. These great economists were right. Their policy was adoj)tcd, and our trade did prosper. No one of these distinguished men doubted, as " X." seems to suppose, that foreign Protective tariffs are a great impedi- ment to our trade, or that it is most desirable that they should be reduced or repealed. What they said was^ " A foreign tariff is one impediment ; over that you have no power. Your own high tariff is another and a separate impediment, with an additional and cumulative effect ; over this you have power. Remove the impediment over which you have power, and do not wait for the removal of the further impediment over which you have no power. You will gain much if you do not gain all. Half a loaf is better than no bread." But the consideration of this fundamental question deserves a new chapter. CHAPTER XXI. HOSTILE TARIFFS MUST BE MET BY FREE IMPORTS. STATEMENT OF THE PRINCIPLE. The fallacy by which " X." and Lord Salisbury and many paii.iciesin others are misled consists in thinking of a high tariff as a the argu- com])lete barrier, a solid wall, a watertight sluice which !['^*^"!%°f- allows of no passage. H this were the case, it would be buryaiui'^" quite true that one high tariff is just as great an impediment others, to trade as two, and that there is no use in removing one unless you can remove both. If every foreign country were to build an impervious wall round itself, so that no trade could enter, it would not signify how much or how little of a wall there may be round England ; no trade could pass either one way or the other. But even in the p,.j^ • , prc-Huskisson days of absolute legal prohibition, the wall of Free was broken through l)y the smuggler ; and, in the present I'^pons. day, no nation practises absolute jtrohibition even on paper. The metaphor of a barrier- wall misleads, as metaphors con- K 146 FREE TRADE V. FAIR TRADE. Protective Tariffs im- pediments, not barriers. Position of a Free Trade country in the midst of Pro- tectionist countries. Effect of Protective Duties as between two Countries only. stantly do. If we are to have a meta])hor, Lord Palmer- ston's metaphor of two turnpikes, one at each end of a bridge, each of which offers some obstacle to the traffic, is a much better one. At the present time every nation, however Protective in its tendencies, does what it thinks best calculated to promote its own exports, and therefore cannot destroy but only check its imports, which are the necessary concomitants of exports. No existing tariff is such as to keep out foreign goods altogether ; each tariff has its weakest point, its lower and less Protective duties. Moreover, as a matter of fact, all nations are not Protection- ist. In many tariffs Protection is a secondary or partial object ; and in other countries importation is altogether free. There are, therefore, abundant means of export ; there are even abundant channels, often direct, often cir- cuitous and indirect, by which, so long as a Protectionist country exports at all, the exports of a free country can reach, and in the nature of things must reach it. Trade will go on, and does go on, in spite of hostile tariffs, al- though the number of transactions is, in consequence of such tariffs, less than it otherwise might be ; and each trade transaction is, from its very nature, profitable to both parties engaged in it. Let us, however, consider a little more carefully what the position of a nation is which opens its ports whilst other nations are shutting theirs ; what our position would be, on the hypothesis (which is untrue) that, whilst we retain a Free Trade tariff, all other nations put heavy duties on our goods. I think it can be proved that, though we shall not have as much trade absolutely as we should hav^e if other nations were free like ourselves, we shall be better off relatively ; the trade and the production of the world will be less, but we shall have a larger share of it. The point, though elementary, is so important that it is worth while to consider it attentively. Let us first take the simplest case, that of barter between two merchants living in two different countries, and let us think what would be the effect on their dealings of a tax, imposed in either country on the importation of the commodities in which they deal. Suppose that A, a Frenchman, makes 100 yards of silk in France ; and B, an Englishman, makes Imports, PART II. — RETALIATION. I47 100 yards of cloth in England. They exchange these one Principle for the other. Suppose that the French Government puts ^^p|^*^ts on the English cloth a duty equal to the value of the cloth ; suppose, further, that the cloth is a necessity to the French- man, and that it is only to be got from England. The effect of the French duty upon the Frenchman will be, that he will have to pay twice as much for the same quantity of cloth as before ; in other words, he will have to pay 200 yards of silk for his loo yards of cloth. Then suppose that the English Government puts on the French silk a duty equal to the value of the silk, and suppose, as befor_\ that the silk is a necessity to the Englishman, and can only be got from France. The effect on the Englishman will be that he will have to pay 200 yards of cloth for his 100 yards of silk. The effect of the two duties combined will be that the Frenchman will have to give 200 yards of silk for 100 yards of cloth, and the Englishman will have to give 200 yards of cloth for 100 yards of silk — the extra 100 yards of silk and 100 yards of cloth going into the pockets of the respective Governments. Of course the real thing will be entirely different ; the goods will not be either necessaries or monopolies ; and the effect of the duties will be to transfer the industries, and, in so doing, to reduce both consumption and production. The effect of the French duty on the Frenchman will be to make the Frenchman buy less English cloth, to make him pay more for it, to make him buy inferior cloth from a French maker, and to make him sell his silk to the French cloth-maker for less than the Englishman would give for it. Its effect on the Englishman will be to de})rive him of the best market for a part of his cloth, to make him buy less French silk, and to make him buy something with the rest of his cloth which is of less value to him than the French silk. The further consequence of the English dut}' on silk to the Englishman will be to make him buy less French silk, to make him pay more for it, to make him buy inferior English silk instead, and to make him sell his cloth to the English silk manufacturer at a less price than the French- man would give for it. Its effect on the Frenchman will be to deprive him of his ])est market for a part of his silk, Imports. 148 FREE TRADE V. FAIR TRADE. Principle to make him buy less English cloth, and to make him buy ofiree French cloth instead at a higher price. The effect of one duty, supposmg the duties still to be equal, will be as great as that of the other ; they will act cumulatively in transferring English and French industries from what they do best to what they can do less well : the French industry from silk-making to cloth-making, the English industry from cloth-making to silk-making. The aggregate production of the two parties will be diminished equally by both duties ; and if one duty is taken off, the m-ischief to both parties will be just one-half what it would be whilst both duties are continued. ; Let us now take the case of two nations who exchange goods with one another ; and let us, after the manner of Bastiat, call one of them Libera and the other Vincta. Libera determines to put no duties on the goods of Vincta- — Vincta puts a duty of 20 per cent, ad valorem on the goods of Libera. The result will be damaging alike to Libera and Vincta ; Libera will be able to sell less to Vincta, and to buy less from Vincta in return ; Vincta will be able to buy less from Libera, and will be able to sell less to Libera in return. Now, suppose that Libera, iiTi- tated by Vincta's conduct, determines to retaliate, and to impose in her turn a tax of 20 per cent, on the goods of Vincta. What will be the result ? Precisely the same as before, only that it will be double and cumulative. Vincta will be able to sell still less to Libera, and to buy less from Libera in return ; Libera will be able to bu}^ still less from Vincta, and to sell still less to Vincta in return. Both duties have had an equal effect in diminishing the buying and selling on both sides. But their action has been cumu- lative ; the duties imposed by Libera have doubled the loss to each originally caused by the duties imposed by Vincta. Libera has done herself no good, but has done equal mischief to herself and her rival by retaliation. It will even, in this case, clearly be her interest to cease following the example of Vincta, to revert to her original policy, and become Libera again ; and it will not be the less her interest to do so because she is at the same time doing good to Vincta. But now let us consider the case of three countries PART II. — RETALIATION. 149 which we will call Libera and Vincta No. i and Vincta Effect of No. 2. Sui)pose that they have a triangular trade with ^uSL? one another, and that these three trades (that of Libera between with Vincta i, that of Libera with Vincta 2, and that of three or Vincta i with Vincta 2) are each equal in amount, and that countries, each of them is represented by 6. Then 18 will represent Abstract the aggregate trade of all three, and each will possess an illustration. equal share of it, which will be represented by 6. Now suppose that Vincta i and Vincta 2 each put equally heavy duties on their respective imports. Libera remaining free as before. The trade between Libera and each of the others will be subject to one set of duties, but the trade of Vincta i and Vincta 2 with each other will be subject to two sets of duties. The aggregate exchange, and with the exchange the production of all three countries, will be diminished, but not in equal proportions. The trade be- tween Vincta No. i and Vincta No. 2 will be diminished in a larger proportion than the trade of each with Libera. If we suppose that each set of duties has the effect of dimin- ishing the trade on which it is charged by an amount re- presented by I, the whole diminution will be equal to 4, and the aggregate trade of the three countries will now be represented by 14 instead of 18. Of this diminution, i will fall on the trade between Libera and Vincta No. i, which will now be 5 instead of 6 ; i on the trade between Libera and Vincta No. 2, which will also be 5 ; and two on the Trade between Vincta No. i and Vincta No. 2, which will now be 4. Each country will, of course, have half the trade between itself and each of its neighbours, and the whole trade will now be divided as follows : — Libera will have 5 instead of 6 ; Vincta No. i and Vincta No. 2 will each have 4J instead of 6. The following diagram will make this clear : — L o Before duties AJter duties 150 FREE TRADE V. FAIR TRADE. Principle of Free Imports. Abstract illustration. Concrete illustration. In the same way it may be shown that if of three countries trading with one another under three tariffs equally Pro- tective, one does away with Protection, the production and trade of all will be increased, but the largest share of the increased trade will fall to the one which opens its ports. When she opens her ports she must do good to her neighbours as well as to herself, though not so much good — a thing which it is important to remember in examining the consequences of adopting a Free Trade policy. Its adoption by one country is followed by an increase of the trade of other countries as well as of her own, though her own trade reaps the greatest benefit. I am not very fond of illustrations of this kind. They are apt to appear to be mathematical demonstrations, when they are really only rude and abstract illustrations of one of the many elements which go to make up the infinitely complex and delicate conditions of human business. But taken merely as an illustration, I believe the above formula represents a general truth. Perhaps a more homely illus- tration will make the matter clearer. Suppose a large village or small to^^^l with three general shops in which everything is sold, from lollipops to hardware. Two of the shops are rented from the squire, who also owns nearly all the land in the parish. He says to the tenants of these two shops — " I want to do good to my estate and those who live on it, and therefore I shall require you, in buying for your stock-in-trade such articles as the estate produces, to buy your articles from your neighbours in preference to buying them from strangers. The i)arish produces corn, wood, vegetables, fruit. There is a local pottery, a local flour mill, a local forge for tools and hardware. All your stock of these things you shall buy from the producers in the parish ; or, if you buy them from strangers, you shall pay me a percentage on your purchases, to be used for the good of the estate." The third shop, happening to be on a bit of land not belonging to the squire, is not subject to his patriarchal theories, and buys all its stock of goods, whether of a kind produced in the ]mrish or not, wherever it can buy them cheapest and best. I think wc can tell which of these three shops will sell the best articles, will sell them at the lowest prices, and will have the largest and most profitable PART II. — KETALIATIOX. 151 custom. The case runs on all fours with those countries of which two compel their producing classes to buy their goods at home, and of which the third leaves them free to buy where and how they best can. To carry our homely illustration a little farther, let us suppose that our squire, alarmed at the success of the in- dependent shop, and the decay of the two which belong to him, says to the rest of the tenants on his estate, " I have compelled my shops, for your sakes, to buy their stock of you. It is not fair, it is not tolerable under such circum- stances, that you should take your custom to that odious free shop, or to the neighbouring town. You shall buy as well as sell at the shops belonging to the estate, and we will all support one another against these horrid strangers." I think our squire would soon find, in his flitting tenants and diminished rents, ample reason for regretting that he had meddled with their bujang and selling. So far, then, as artificial restrictions are concerned — and it is only with these we are now dealing — the country which keeps its own ports open whilst the ports of other countries are shut will not do as much trade as if the ports of all were open, but of the reduced trade which is left by the restrictions it will do a larger share. If England keeps her ports open whilst the United States, France, German}^ Italy, and other countries shut theirs, the aggi-egate trade of all of them, and even the actual amount of England's share, will be less than if all of them were open ; but her share of what is left will be greater than that of the others, and it will be proportionately greater than it was when the ports were open. It is to her open markets rather than to those of the closed countries that each foreign country will ])refer to ex{)ort, and return trade is apt to follow in the same channel. To her will come raw materials, half- manufactured goods, food, clothing, everything which aids })roduction directly or indirectly. No market is likely to be so closed against her but that she will be able to get some- thing into it, and in doing so she will, by her command of the materials and instruments of jiroduction, be better able to compote than her rivals, who have made the materials and instruments of production dear. To all open neutral markets — and they are many — she will have full access. In Principle of Free Imports. TheNation which re- mains free will get the largest share of the Trade. 152 l-*KliE TRADE V. 1"AIR TRADE. all neutral markets, open or closed by duties, she will ha\e an advantage. Her open market will attract imports ; her command of all that is needed for production will give com- parative cheapness to her exports. She will lose absolutely some of the direct trade with her Piotectionist rivals which she might have had if it were not for their duties, Ijut they will lose that trade also, and she will have advantages in competing with them in other markets which they will not have. How Protection defeats itself and helps Free Trade rivals is well exemplified in a case mentioned by the Qiiixrtoiy Review for August^ 1903. German iron is raised in price by Protection to German customers, being quoted last year at 95 marks for delivery at the Rhenish Westphalian works when it was being dumped in England at 80 marks f.o b. As a result, the Quarterly records that " a British firm has recently secured a contract to construct certain ironwork in Berlin, and it is explained that German iron will be used, as it can be bought more cheaply in P2ngland than in Germany." A similar case is quoted by the British Consul-General at Frank- fort : "A factory [at Diisseldorf] using tin for its raw material con- tinued for many years a profitable trade with Holland in tinned goods, buckets, &c. In consequence of the cheap export price of tin, the identical goods are now manufactured in Amsterdam, very probably from German material, so that the manufacturer was left with a stock of about ioo,coo pails, for which he could find no customers. Another firm [in Dortmund] has decided to transfer a considerable part of its establishment to Holland, as it can there obtain the necessary German raw material so much more cheaply than in Germany." In iSSi the Colony of Victoria exported ;^226,203 worth of Victorian-made apparel. In 1893, duties in the meantime having been largely increased on both the apparel and the cloth which formed its raw material, exports fell to ;i^54,9i7- Even the Protectionist Commission — which was inquiring into the causes of grievous sweating in Victoria in its maximum tariff period — were forced to see in this falling trade the direct result of Protection, and thus reported to Parliament : — << \Ye feel impressed by the weight of the evidence as to the loss that has ensued upon the great shrinkage in the intercolonial trade. It is manifest that if the low-price cloths under consideration are imported at other Australian ports at lower duties, Victorian competi- tion in intercolonial markets must be seriously hamjiered. . . . We submit these considerations in view of the representations made by experts on behalf of employers, which are endorsed and supported by I'ART II.— RETALIATION. 153 employes generally. The latter contend that a much greater amount of employment than that now offering would result from the removal of restrictions which they allege press heavily on the clothing industry, and that an alteration in the direction indicated would, by extending the field of labour, prove a powerful and effective antidote to the sweating evil." Such was Protectionist evidence on the effects of Protection. CHAPTER XXII. FIRST OBJECTION TO THE PRINCIPLE — HOME TAXATION. The jirececling cha}:)ter contains a statement of the general argument for lighting hostile tariffs by free imports. Let us now consider some of the Protectionist's objections to this principle. One of his favourite arguments is, that the produce of home labour, and especially of agricultural labour, is taxed, whilst foreign produce comes in free ; and he })roposes to put a tax on foreign produce in order to redress the injustice. Thus the chairman of the Fair Trade League says, in his letter to Lord Derby, p. 6 : "I will cite as an illustration the case of a bullock bred for the home market. During the two and a half years it is being reared, an acre of land must be told off for its support. The State claims on that land amount to from twelve shillings to fifteen shillings per cent, per annum, depending on the county in which it is raised. Thus the English bullock costs its breeder from thirty shillings to forty shillings per head taxation, independently of the further indirect taxation incurred in the keep of its caretaker. The agriculturist asks, therefore, fairly enough, ' Why should my beast, which has contributed so much to local and imperial taxation, have to compete in the same market-place with animals on which not a i)enny of taxa- tion has been paid ? ' " Now I will not stop to inquire into Mr. Samjison Lloyd's figures ; I will not inquire whether the sum is correct ; 1 will not ask on whom the taxation falls, viz. Are our producers to be com- pensated for the taxes they pay? Mr. Samp- sonLloyd's taxed bullock. 154 FREE TRADE V. FAIR TRADE. Objections to the Principle. Taxation should be fair as be- tween dif- ferent classes. But the Foreign producer pays direct taxes no less than ours, and is burdened with heavier charges of other kinds. whether upon the agriculturist or upon rent ; or whether these taxes, if remitted, would go into the pocket of the landlord, or help to facilitate the production of beef. Let us assume that the tax is a tax on productive industry, and that it is to be looked at in precisely the same light as the income tax, and the rates which the manufacturer pays on his business or his factory ; and let us ask, on these very improbable assumptions, whether any such taxation affords the slightest ground for a countervaihng Customs duty on an American bullock. If the Fair Traders meant that English taxation was not fair as between different classes of Englishmen, and that local rates might be more fairly apportioned than they are ; if they wished that accumulated personalty should bear its fair share of local and imperial burdens ; above all, if they meant that the incidence of taxation as between rich and poor should be fully inquired into, and the in- justices, if any, be redressed, the demand would be a fair one, though it might, perhaps, land them in unexpected conclusions. But this is obviously not what they mean. If they have any intelligible meaning, it is that we shall take into consideration the taxation which falls — directly or indirectly — on every branch of productive industry, and shall then put upon the corresponding foreign produce a Customs duty equivalent to the taxation which the home produce bears. Now, in the first place, the assumption that foreign pro- duction is untaxed, or is taxed more lightly than English production, is certainly not true, and is probably the re- verse of the truth. In actual direct taxation per head, England compares not unfavourably with other similar countries, whilst their taxation per head is growing much faster than ours. Supposing that, instead of simple taxa- tion per head, we take the proportion which wealth bears to taxation, or, in other words, the capacity to pay, as our standard of comparison, England is one of the most lightly taxed nations of the world. If, again, we do not confine ourselves to direct taxation, the case in her favour becomes much stronger. Supjwse, for instance, that we take military conscription into account, European nations will be found to have laid on their national industries an PART II. — KiiTALIATION. 155 immense additional burden, which England does not lay Objections on hers. And if, in addition, we take into account the loss p^'^^. j^ which foreign countries by their Protective systems inflict Taxation, on their industries, we shall find that the burden thrown on their productive powers becomes out of all proportion greater than that which is imposed on English industry by English taxation. Thus Germany, France, Italy, Russia, not only rob industry of a large part of its most effective labour by con- scription, but also make their productive industries less efficient by heavy Protective duties. As regards cur greatest agricultural provider and competitor, the United States, it has been calculated that their Fiscal system imposed on the American farmer an annual burden of some 400 millions of dollars, or £80,000,000 sterling, in the shape of increased price of manufactures excluded by their Protective tariff ; and that of these 400 millions, only 60 millions found their way into the State Exchequer.* To burdens such as these foreign produce is subject, and in addition to the cost of transit — often over many thousand miles of sea and land — before it can reach English markets. In the second place, the financial problem involved in Compensa- any proposal to counterbalance home taxation by Customs ^°^y }^^^- duties is an insoluble one. It is difficult enough to ascer- pnicticable. tain the exact incidence and effect of any tax or Fiscal burden at home. But if we are to attempt to ascertain the effect of the taxation of each foreign country on each article it produces, to compare it with our own taxation of the same article, and then to impose a Customs duty on each article which will make home and foreign taxation equivalent, we shall introduce a system of finance and of taxation more preposterously absurd and complicated than has ever yet been dreamed of. But the whole proposal is a delusion. We cannot get rid of our Fiscal burdens. Each country requires to raise * See Mongredien's "Western Farmers of America. " Cassell & Co. The burden of these increased prices is less now. But this is because Protection has stimulated an unhealthy growth of maiuifacture, and a consequent glut and depression which have depressed prices, and brought ruin on the industries which tlie system was inlentled to protect. .See below, Chapter XI.II. 156 FREE TRADE 7'. FAIR 1 KADE. a certain amount of monc}- by taxation for public purposes. One country requires more and another less. This burden it must bear. It cannot by any hocus-pocus throw it on foreign countries. It may shift the burden from one class to another of its owii citizens ; it may arrange the burden so as to do as little harm or as much harm as possible, but, assuming the purposes for which it is raised to be necessary, it can no more get rid of the necessity of paying for them than it can get rid of its soil or climate. To com- pensate the English farmer, at the expense of his fellow- citizens, for the excess, or assumed excess, of taxation in England, is much the same thing as to attempt to com- pensate him for his inferior soil or sunshine ; and any at- tempt to do so can only result in limiting the productive powers of the country as a whole. It would indeed be a charming discovery if Governments could relieve their own countrymen from taxation by simply taxing the produce of other nations. Chancellors of the Exchequer would revel in their budgets, which would become, if not small, yet delightfully easy ; and Jingoes would trium}:)h in the simultaneous impoverishment of their neighbours and enrichment of themselves. For- tunately, or unfortunately, no Chancellor of the Exchequer can do anything of the kind. He cannot draw his taxes from any country but his own. He can injure other nations, but not without injuring his owoi still more. Re- garded from his own point of view, Protection, in pro- portion as it succeeds in its primary object, will aestroy his revenue. It will kill the goose which lays his golden eggs. Take two neighbouring parishes, the inhabitants of which are accustomed to buy and sell from one another. One of them has to go to great expense for drainage works and water supply, and the parochial rates rise. Would any- one be silly enough to suggest that this rise of rates could be compensated by imposing a duty or restriction on the purchase by its inhabitants of goods sold by the other ? And yet this is not more absurd than to sujipose that we can make the Americans pay our income tax or our poor rate by laying a duty on American bullocks. 157 CHAPTER XXIII. SECOND OBJECTION TO THE PRINCIPLE — EXCESS OF IMPORTS. Another objection which the Fair Traders make to our principle of Free imports is that imports displace British production, and that consequently the excess of imports, which is apparent in our recent Trade Returns, is a fatal sign of the decadence of English industry. Imports are their great bugbear, and to them excess of imports means ruin. There is, perhaps, no subject on which so much nonsense has been talked. It is nonsense which reappears under a great variety of forms. For instance, I find in one of the Fair Trade tracts a long and graphic description of the making of a plough in England, and of all the English people employed in preparing the materials and putting them together. The whole culminates in the sale of the English-made plough to a farmer for ;£i2, whilst a similar article might be imported from abroad for £ii los. All this is for the sake of the following precious piece of political wisdom : — " I must deal with the question in its practical bearing, and tell you that the dogma, ' Buy in the cheapest market,' is a gi^eat delusion, for, in the case of the plough which pro- duced ;^I2 to the whole nation, if it could be bought from the foreigner for ^^ii los. the whole nation would certainly gain I OS., hut would lose the £12 by the collapse of that special industry, the nation, from the Government down to the candle- stick maker, being poorer by £11 los. in distributive wealth." Astounding conclusion ! How do the Fair Traders think the imported foreign plough is to be paid for ? With nothing ? If so, then the nation will be richer not by los., but by £12. If with something, then with what ? Why, of course, with something which English workmen can make l^etter and chcajKn" than they can make jiloughs, and which will have to lie sent abroad, and there sold to ]iav (or till' plou.i^li. Alleged excess of Imports. Fair Trade ploughs gratis ! Objections to the principle. Excess of Imports. 158 FREE I'RADE 7'. FAIR TRADE. Largest im- ports cause largest pro- duction. The fear of growing Imports. Again, in another of their leaflets I find a long story about the producer and consumer, and a long and tedious attempt to show that in consulting the interest of the cus- sumer by encouraging imports we are damaging the pro- ducer, and discouraging exports. In this there is a double fallacy. In the first place, pro- ducers and consumers are really the same people. The distinction between producer and consumer is of use and of interest in arguing questions of political economy, where the different capacities in which men act, and the different motives which impel them to action, have to be taken into account ; but producers and consumers are, in real life, the same persons. Every producer is a consumer, and every consumer (except the purely idle, whom we need not now consider) is a producer. The workman who pro- duces steel rails, consumes bread, meat, tobacco, clothing, and a number of other things. The learned classes — the engineer, the lawyer, the doctor, the statesman — whilst consuming whatever is necessary for life and health, assist in production no less than the workman. We are all — if we are doing anything useful — producing as well as con- suming. There is really no interest of producers separate from that of consumers. We are all interested in bujang what we want wherever we can get it best and cheapest. Secondly, if we look to production alone, and put con- sumption out of the question, it is the largest amount of free imports which will cause the largest amount of pro- duction. Not, no doubt, of the same articles, but of articles which we can produce better and with more advantage to ourselves and to the country than wc could produce the articles which we import. The moment we cease to ]-)ro- duce such articles wc shall cease to import. So long as we import we may be sure that we have bought those imports with our labour, and either have paid, or are paying, for them with our exports. We can pay for them in no other way. But it is the growing excess of imports which fills our Fair Trade friends with their most terrible alarms. The absurdity of these terrors has been so often and so fully exposed that it is unnecessary to repeat in detail the PART II. — RETALIATION, 159 many arguments which show that our imports are large because they include the profits of our present trade, and of our past savings But it may be desirable to state the out- lines of the case shortly, premising that the incompleteness of our statistical records makes error easy and exactness Imperfec- impossible ; for, not only do our statistics of exports omit ^°".°( much which is really produced and sent out of the country, statement but all attempts to strike an exact balance of imports and of Balance exports are confused and baffled by investments, and by ° ^^ ^' the traffic in securities. We know that all exports of goods are made either in exchange for the imports of other goods or bullion, or by way of loan to be repaid hereafter by imports — and we know that imports are made either in exchange for goods or bullion, with the necessary additions for freight and profit, or by way of repayment of the prin- cipal or interest of loans which we have formerly made. But we do not know how much is due to each of these causes, and we cannot, therefore, strike an accurate balance. We do not know the exact state of our debtor and creditor account with foreign countries. The difficulty is increased by the fact that securities are now used as a sort of international cash, and are transferred from country to country, not as permanent investments, but in place of bullion to settle the balance of accounts. In consequence there is large room for speculation and for error. But all economists agree that we are a largely-lending country, and that we have enormous investments abroad, of which the interest and profit are daily returning to us in the shape of imports. The case may be put shortly as follows : — The excess of imports over exports in 1880 was : — Imports ;i^4 1 1,230,000 Exports 286,415,000 ;^ 1 24, Si 5,000 And in 1884 it was : — imports ;^390,oi9,ooo E>:porls 295,968,000 ;^94,o5 1,000 i6o FREE TRADE I'. FAIR TRADE. Ol>iections to the principle. Excess of Imports. Estimate of Foreign Invest- ments. Outgoings on Ships. In 1902 it was : — Imports ;^528,39i,ooo Exports 349,239,000 ;^i 79, 152,000 The amount of English capital constantly employed abroad in private trade and in ])ermanent investments, in- cluding Stock Exchange securities, private advances, pro- perty owned abroad by Englishmen, British shipping, British owned cargoes, and other British earnings abroad, has been estimated by competent statisticians as being in 1880 from 1,500 to 2,000 millions, and it is constantly in- creasing. Taking the lower figure, the interest or profit upon it, at 5 per cent., would be 75 millions, and at the higher figure, 100 millions. But a large proportion of this amount being employed in active business, would bring in more than 5 per cent, profit, probably not less than 10 per cent. Supposing one-quarter to bring in that interest, we should have, as the income of 1,500 millions capital, 94 millions ; for the income of 2,000 millions capital, 125 millions. The former amount is equal to, and the latter greater than, the excess of imports over exports in 1884. But besides this, there is the question of freights. A very large proportion of the trade of the United Kingdom is carried in English ships, and these ships also carry a large proportion of the trade of the world which does not come to England. This is, in fact, an export of highly-skilled English labour and capital which does not appear in the export returns, and considering that it includes not only the interest on the capital invested in the ships, but wages provisions, coals, port expenses, repairs, depreciation, and insurance ; and that the value of English shipping employed in the foreign trade is estimated at considerably more than 100 millions sterling, the amount to be added to our exports on this account must be very large. Add to this the ships built for foreigners, amounting in 1880 to 70,000 tons — chiefly steam-ships — the ships repaired for foreigners and the ships sold to foreigners, amounting in 1880 to 75,000 of sailing and 36,000 of steam tonnage, worth altogether several millions, which do not aj^pear in our list of exports. All these outgoings, except the small part spent abroad, PART II. — RETALIATION. l6l with the profits, must either return to this country in the Objections shape of imports, or be invested al^road. From all I can ^^.'"^^ , I T 1 1- 1 -11 • principle. learn, 1 believe that 50 millions is too low an estimate of Excess of the amount of unseen exj:»orts, which should be added on imports, this account to the total of exports visible in our statistical returns. In addition, there are the commissions and other charges to agents in this country, connected with the car- riage of goods from country to country, which are analogous in their nature to the charges of the ship-owners for con- veying goods, all of which appear in our accounts of imports, but none of which appear in the list of exports. If there is any truth in the above figures, not only is the excess of imports over exports accounted for, but there is really a large surplus of imports due to us, which can only be accounted for by supposing that we are still investing large amounts of our savings in foreign countries and in the Colonies. We need not, therefore, be afraid either that we are consuming the realised earnings of past generations, or that we are ceasing to be able to earn. Though receiving more, we are still earning ; and we may consume in confi- ■ dence, because we jM-oduce in abundance. We have already, on page 9, quoted a balance-sheet from the Protectionist publication, *' Imperial Reciprocity," issued by the Daily Telet;ra/ Trade New South Wales. Above all, are not our exports diminishing while our imjwrts are increasing ? Have we not had the longest period of commercial de- ])ression ever known ; and is there any reason for su})- ]-)0sing that we shall so far recover from it as to attain again our former i)rospcrity ? " PART II. — RETALIATION. 187 To this I propose to reply at length in the following The World chapters. But in the first instance I wish to observe that "o^.^o ^^°- ■ ■ 1 11- 111 tective as it it IS a mistake to sui)pose that the world is, on the whole, was. more Protective than or even as Protective as it was. In the earlier part of this century nations were Prohibitive where they are now Protectionist. Prohibition pure and simple, common enough before i860, scarcely exists now. Many countries — e.g., Holland, Belgium, Norway and Sweden— have since i860 adopted a policy approaching our own. Scarcely anywhere in Europe are tariffs now as high as they were before i860. Many neutral markets are free. But, secondly, be the tariffs what they may, our freedom still gives us an advantage. We can and do export, even to the most Protectionist countries, manufactures which they are trying to keep out, and we must do so as long as they burden their own industries by a Protective system, and seek at the same time to sell their raw produce to us. In neutral markets, of which there must always be many, we have enormous advantages in our free tariff. Our materials come to us free, and our people live on untaxed food. Let us also bear in mind that these human laws which Human we make so much of are but trifles in face of the great laws only changes which are extending the borders of the nations, hiThe^great and bringing them together. Steam and electricity, the result, steamship, the railway, and the telegi-aph, the im})rove- ment of every part of production, including agriculture, the specialisation of these arts, and their distribution among different classes and peoples, the system of credit — all these things make the inter-dependence of different countries both more practicable and more necessary day by day ; and the system of international commerce flows on, ever widening and deepening, in spite of the puny barriers by which the folly of man tries to check and impede its course. Mischief they can do, but it is small compared with the magnificent results of the beneficent laws of Nature. t88 CHAPTER XXX. WHAT FREE TRADE MEANS, AND WHAT IT CANNOT DO. At the same time it must be remembered what Free Trade is, and what are its Hmits. It is merely the imshackhng of powers which have an independent existence. It can produce nothing ; it can create no material substance in Nature ; it can beget no positive qualities in man. All it can do, and that all is not much, is to leave the powers of Nature and of man to produce whatever it is in them to produce unchecked by human restrictions. Free Trade cannot make the maize and the vine grow in England ; it cannot make our sands and clays yield wheat as freely as the virgin soil of the prairies ; it cannot endow the negro and the Hindoo with the ingenuity and thrift of the Frenchman, or the brain and arm of the Anglo-Saxon ; but it can insure that each shall be allowed to jdeld and do whatever it is best fitted for yielding and doing. Free Traders have been much to blame for attri- buting to Free Trade consequences which have probably arisen from many causes, and they are now paying the penalty of their exaggerations. It is idle to expect that England shall produce everything, or even that she shall have a monopoly of manufactures. Other countrie's have their own special advantages of soil, of climate, and of human character, laws, and habits, which will enable them to do many things better than England. The true test of the value of Free Trade to England, or to any other country, is not whether she is progressing faster, or even doing a larger trade than another, but whether she is doing better herself with Free Trade than she would do without it ; and whether, in her relation to other nations which are not Free Traders, she or they derive the greater benefit from their respective commercial systems. Tried by these tests, we need not fear the comparison. 189 CHAPTER XXXI. RELATION OF THE PROSPERITY OF OTHER NATIONS TO OUR OWN. Before attempting to prove anything by facts and figures, Our Trade let us be on our guard against a mistake, by which our Pro- '^'^"^°^^^ tectionist friends are constanly leading us into pitfalls. It making the is a very important and a very dangerous mistake, for it Trade of involves the very principle which lies at the bottom of the NaiiLns Free Trade controversy. To read Protectionist literature, grow too. one would imagine that no nation could thrive except at the expense of another ; that trade, at any rate between nations, is a sort of betting or gambling game, where the gain of one is the loss of another. If the list of French ex- ports grows as ours grows, still more if it increases by a per- centage faster than our own, we are in danger. If the American export account appears to exceed our own, we are lost, and so on. Unless our sale list keeps far ahead of and grows faster than that of all other nations, we are losing our position, and dwindling among the races of mankind. 13ut the truth is that trade is reciprocal : our trade cannot grow without making the trade of other nations grow too. Every act of trade is a sale by one man and a purchase by another, and every such sale and purchase involves a second purchase by the first man and sale by the last. Every act of trade is an act of barter — or, rather, one-half of an act of barter. Except in the case of transfers of goods made to pay existing debts, every sale by an Englishman to a Frenchman involves a sale direct or indirect by a Frenchman to an Englishman. Every English export to France involves a French import from England, a French export on account of England, and an English import on account of France. And the whole trans- action is a gain to both traders and to both countries. An increase in the English export list, arising from the removal of our own restrictions, necessitates an equal and corre- sponding increase in the French exjiort Hst ; and the in- crease in the French exports, which follows the remo\'al of I()0 FREE TRADE V. FAIR TRADE. our restrictions, is the proot and consequence ol an increase in English trade. We cannot do good to ourselves without doing good to our neighbour. Nay, if we are doing much the larger trade of the two, it may very well happen that by removing some artificial restrictions which we have placed on our trade with him, we may arrive at the result of increasing our neighbour's trade by a percentage on his trade greater than the percentage by which we increase our own — a catastrophe which excites the liveliest alarm in the minds of those who think the infant of two years lives faster than the youth of twenty, because in one year the infant has doubled his age, whilst the youth has added only one-twentieth to his. It would be seen to be the height of al)surdity if a manufacturer, a merchant, a farmer were to look on the lirosjierit}' of his customers as signs of his own decay. Con- ceive the village baker saying to the shoemaker, " You are making too much by my custom ; you have enlarged your shop, you are taking an apprentice ; you eat more of my bread, it is true, but I cannot bear to see you so rich. I shall do without shoes, and go barefoot, in order that your balance may be less at the end of the year." And yet this is the spirit in which we often look at foreign statistics. The very giowth in them which we envy is often tlie neces- sary result of the increase of our trade, which again is the result of our own free policy. When we reduced our^tariff between 1840 and i860, we increased our own exports and imjiorts ; but we increased those of America and Germany and France at the same time. Consequently, in comparing national statistics, the question is not whether we increase faster than or as fast as other nations, though this question may often be answered in the affirmative, but does our Free system enable us to do trade with other nations which we should not do without it, and does it enable us to do trade from which they cut themselves off by a system of Protection ? In saying that trade is necessarily a mutual benefit, I do not forget competition, or the partial and local suffering which it occasionally causes. Competition becomes wider, if not more severe, as communication extends. But com- petition is one form of a higher law, of which in this case PART II. — RETALIATION. 191 we can sec the beneficent results, and which neitlier men nor nations can disregard with impunity. Free Trade cheerfully obeys this law ; it has regard to sellers who want to sell what other people want to buy, and to buyers who want to buy what other people want to sell. Protection discourages such buyers and sellers, and encourages instead of them, and at their expense, the sellers who want to sell what nobody wants to buy. If in the race of comi:)etition we were en- tirely thrown out ; if, whilst other nations were prospering, our forges were extinguished, our looms idle, our ]mu])erism on the increase, and our consumption seriously diminishing, it would be time, not to reverse our policy, but to recon- sider our position. But whilst the very opposite of this is the case, it is the height of folly to look with jealousy on the growing wealth of other nations who can sell what we want to buy, and Iniy what we want to sell. CHAPTER XXXII. COMPARISON or STATISTICS OF TRADE OF DIFFERENT COUNTRIES. Let us now take the case of one or two foreign countries, and see whether what we know of their trade is such as to make us fear that we are losing our hold on the markets of the world. In making any such comjiarison, two or three points must be remembered. First, as I have already pointed out, the increase of our own trade necessarily involves the increase of the trade of foreign countries. This must be so, whether they open their i)orts or not. If they reduce their duties contem- poraneously with our reduction, their trade as well as our o\vn will increase by so much the more ; if, not, it will in- crease, but not so much. It is therefore to be expected and desired that the trade of foreign nations should increase when our own increases, and such an increase is not so much takt'U from us, but so much in our favour. Compari- son with other Nations. Increase of our Trade means in- crease of Foreigners' Trade. 192 FREE TRADE V. FAiR TRADE. We cannot keep all Manufac- tures, Secondly, in comparing our own trade with that of other countries, it is common to take the whole exports of domestic produce as the test. But this is tiihil ad rem, so far as our manufactures are concerned. We export litt e or no food, and little or no raw pro- duce of the soil. If we wish to see whether other nations are progressing faster than ourselves, or, which is the more material point, beating us out of the market, we ought to confine our attention to what we produce our- selves. I have, therefore, in the following figures en- deavoured to do this in a rough way. Even increased exports of domestic produce are no in- fallible test of progress. British imports might increase, through our drawing more of the interest due which is now re-invested abroad, while our exports remained stationary or absolutely decreased, and at the same time production and trade, owing to local consumption of locally made goods, might be more active than ever. Not the actual or comparative amount of exports, but the actual and comparative degree of wealth and comfort obtained by the people under a particular fiscal system, is the true test of its value. As a matter of fact, the years 1898 to 1902, between which German exports increased by nearly ;^5o,ooo,ooo per annum, were years of commercial depression and sore distress, while during the same years in the United Kingdom business activity, high wages, and increasing wealth were accompanied by a very small increase in our exports. Thirdly, it must be remembered that the following figures, taken from our statistics of. exports, do not include the unseen exports which we make in the shape of shij^s and freight. These are as much the produce of English skill and labour as our cottons or our woollens, and probably amount annually, as above stated, to more than 50 millions, one-sixth of our whole exports.* The amount earned annually in freights by IJritisli shi))s is now estimated at about 90 millions. Fourthl3% even as regards manufactures, it ought to be no surprise to us that some nations are progressing faster than ourselves, or even competing with us in some articles in our own markets, if we hold our own as a whole. * See Mr. Giffen's lissays in Finance, 2nd series, " Use of Import and Export Statistics," p. 171. PART II. — RETALIATION. 193 To hear people talk, one would think sometimes that we entertain the notion that we are to have a monopoly of manufacture, and are frightened if we see that any article which we make is successfully made in another country. Nothing can be more absurd. Providence has given us no monopoly of natural gifts, and the very essence of the Free Trade doctrine is that each country shall do what it can do best. It is not a loss, but a great gain to us, if France sends to the world, and to us among the rest, her tasteful stuffs, and if America provides us with her ingenious labour- saving machines. We have been the first in the field with the great metal and textile manufactures, and we are still first in general mechanical skill. But the probability is that other countries will by degrees follow us successfully in the older manufactures and in the coarser productions ; and that we shall still continue to invent and to supply the world with the newer j)roducts of scientific manufacture. As some evidence that this is actually the case, I may c[uote the following passage from Mr. Newmarch's ex- haustive address to the Statistical Societ}', contained in the Society's Journal of June, 1878, p. 211 : — " Between 1856 and 1877 supplemental exports (viz. those not in- cluded under the great heads of Textiles ; Sewed ; Metals, Ceramics, etc.) increase threefold — viz. from 13 to 37 millions — and the proportion to the total exports rises from ir to 19. The progression of the figures is rapid and large, and strongly suggestive of a vigorous and inventive trade in which the rapid appearance of new commodities is l)roportionally pressing open and enlarging the previous classifications and vocabularies." The supplemental list thus referred to contains, amongst a multitude of articles, biscuits, medicines, chemicals, painters' colours, musical instnnnents, telegrai)h materials, india-rubber and jute manufactures, etc. etc. To lind that France, (iermauy, ;iud America are making cotton anil woollen goods lor themselves and exporting them is what we must expect, riie question we have to consider is, what is our manu- facturing position compared with the manufacturing position of countries which have Protective systems, and whether such success as they have has accrued to them in consequence of their Protective systems, or in spite of them. N We supple- ment I rade which we lose by new Inven- tions. English 'Trade compared with that of other nations. 194 FRHE TKADK V. FAIR TRADE. In the first ])lace I have api")ended tables (XVII. to XX.) showmg in a comparative form the total imports and exports of the United Kingdom, of France, of Germany, and of the United States — as to Germany from 1872, and as to the other countries since 1854 — taken from the evidence given by Mr. Giffen to the Royal Commission on the Depression of Trade. In looking at any figures of this kind, several points must be borne in mind. First, these statistics only give the foreign trade — i.e. the produce exchanged with foreign nations. They tell nothing about the produce of each country which is consumed at home. Secondly, the figures given are money values and not quantities ; so that if, as is no doubt the case, there has been any rise in the value of money as compared with commo- dities, that change must be allowed for in comparing the figures for different periods. Consequently, the bulk and amount of the trade in all the tables is, at the present time, as compared with the trades of the earlier years, greater than the figures ap})ear to show. Thirdh\ the statistics of the different nations are not all })rocured and arranged on the same principles — e.g. in the United States statistics of imports the values given are the values at the port of shipment, whereas ours are taken at the port of delivery, which of course makes the United States import figure smaller by comparison. There are various other differences in the manner in which values are taken in different countries, that prevent the i)0ssil)ility of minute comparison. But these differences do not prevent the ta])les from being valuable for the ])urpose of showing the rom])arative ])rogress of the trade of each country, and its fluctuations from time to time. In the case of Germany, however, there was a change in the mode of taking the statistics in 1879 which may i)ossibly affect the com- parison of later with previous years. In addition to these general tables, I have had tables l)repared (XXI. to XXIV., in the A})pendix) in which the exports of the United Kingdom. France, Germany, and the United States are taken for two different periods, and are divided roughly into food, raw materials, and manu- factures, so as to show, so far as it is possible to show by statistics, first, what is the amount of manufactures ex- PART II. — RETALIATION. I95 ported by each country ; secondly, what proportion that amount bears to its total exports ; and thirdly, how these proportions are progressing. I have said above that I do not myself rely on the distinctions commonly drawn be- tween raw materials and manufactures, and that there is a great difficulty in drawing any satisfactory line of dis- tinction between them. The distinctions contained in these tables do not therefore pretend to accuracy. No two persons would distribute the items in the same manner. Moreover, the statistical returns of each country are often classified according to its tariff, rather than according to more natural principles, and this causes additional con- fusion. I may mention, as an instance of the difftculty, the case of pig iron. It is here classed as a raw material, but it is the product of one of our most important manufactures, is one of our chief exports, and is highly protected in many foreign countries. However, I have taken the distinctions as made in tables which are already before the public ; and, generally speaking, it may be said that what are here included under manufactures are special objects of Pro- tection in Protectionist countries. As regards foreign countries, I have not carried the distinction between food, raw materials, and manufactures later than 1880. To work out the distinction on the same jninciples on which the English analysis is worked out is a laborious task, and it is, after all, as mentioned above, not satisfactory. To make it on any other principle, or to accept the distinction as made in foreign returns, would , lor purposes of comparison, be useless and delusive. CHAPTER XXXlll. FORIilG.N TRADE OV THE UNITED KINGDOM SINCE 18O0. The statistics of the foreign tiade of the United Kingdom, statistic? giving the value of the imi)orts and exports and their amount per head of the })opulation for each year, and for quinquennial periods since 1854, will be found in Table 196 FREE TRADE V. EAIR TRADE. XVII. in the Ajipendix. They may be summarised as follows : — Taking quinquennial jjeriods the annual averages are — I'opulalion ill Net Imports. Exports of Home Produce. \ ears. Millions. Amount in Millions, Per Head. Amount in Millions. Per Head. £ s. d £ s. d. 1855-9 29 146 5 3 7 116 424 1860-4 29 193 6 12 9 138 4 14 8 1865-9 30 237 7 i6 3 181 5 19 1870-4 32 291 9 2 4 23s 7 7 3 1875-9 34 320 9 10 4 202 600 1880-4 35 344 9 '4 9 234 6 12 9 1885-9 366 318 8 14 2 226 6 3 8 1890-4 38-1 357 9 7 3 234 6 2 11 1895-9 400 593 9 17 2 239 5 19 5 And for each of the years 1880 to 1885 inclusive, and 1898 to 1902 inclusive — 1880 1881 1882 •883 1884 348 334 348 362 327 223 234 242 240 233 1885 (Population 36 tnillions) 316 213 1898 1899 1900 1901 410 420 460 454 233 264 291 280 1902 (Population 42 million.s) 462 283 Taking quinquennial periods and remembering that we are dealing with values and not with quantities, there has been a constant increase in the imports ; and if the exceptional years 1870-4 are excluded, a constant increase in the exports. Taking the last five years there was a PART II. — RETALIATION. 19; Effect of Foreign Trade in slight falling off in the value of imports in 1884, and of exports in 1883 and 1884. This falling off continued in 1885. In the meantime the population had increased by eight millions, or by nearly one-third ; and the increased population are living in far greater comfort, so far as re- gards necessaries of life, than the smaller population of 1855-9. It is obvious that this must be due to their foreign trade, since the country itself produces little, if any, more food than in 1855-9. To keep 36 millions of feedTn hungry, vigorous souls in much better health and strength ifcreased and comfort than 28 millions were kept in 30 years ago is, """^ ^^^' if we will consider it, no small achievement. As I write I come upon the following passage in a letter from one of the highest living authorities,* describing what our foreign trade has done for our people. After all it is in what people get, and not in what they give for it, that their real wealth and well-being consists ; and it is by the abundance of those things which poor as well as rich consume that the real prosperity of a country must be tested : — " The supply of wheat and flour, home and foreign, in 1851 gave 317 lb. per annum to each of a population of 27 millions, which, at the average price of the previous ten years of Protective duties, amounted to £53,500,000. But the total supply of 1885 gave 400 lb. per head to a popu- lation of 36 millions, at a cost of ;f43, 700,000. Not only was our people, 8| millions increased in number, fed with bread at a diminished cost of 10 millions sterling, but each individual had an additional supply of one-fourth beyond that of 1851. It is not quite e.isy to see how Sir James Caird arrived at liis figures. Talking the total amount of home-grown wheat pkis the total amount of wheat, llour, and meal imported, and expressing the meal and flour in terms of wheat, gives a total of 3S5 lbs. per person, when divided by the population of 36,000,000. This is on the data given by the Statistical Abstract, and assuming a bushel to con- tain 60 lbs. Calculating upon the same basis for 1901 we find lh.it the wheat supply per inhabitant, with a population of 41,457,000 was 350 lbs. ptr head. As, however, in neither case was the whole or Letter fiom .Sir Janr.es Caird, in the Times of July 5lh, 1886. iqS FREE TRADE V. FAIR TRAD£. anything like the whole of this used for home consumption, the figures do not give any reliable information as to the amount of bread used by the people. " The supi)ly of animal food in 1885, as compared with 1851, increased in still larger j^roportion. The quantity to each individual of the increased population was 115 lb. per head for the 3'ear 1885, as compared with 90 lb. per head in 1851. This is an increase of nearly one-third to the supply of each person, the main part of which increase has come from foreign countries. A result so beneficial in the supply of bread and meat to our ever-increasing l)opulation must render any return to Protective duties on food in this kingdom impossible." As regards the exports of domestic produce, distin- guished into food, raw materials, and manufactures, the figures will be found in Table XXI. in the Appendix. They may be summarised as follows : — Exports of Domestic Produce from United Kingdom.* Amount, in Thousands of Pounds. Percentage of Total. 1870. 1880. 1884. 1870. 1880. 1884. Food .... Raw Materials . Manufactures . . £ 7,607 13.744 178,236 £ 8,825 23,272 190,963 £ 9.490 22,232 201,303 4 7 89 4 10 86 4 ID 86 Total . . . 199,587 223,060 233,025 100 100 100 1890. 1900. £' 13.622 42,781 231.789 291,192 1902. £ 'S.514 31,008 216,902 1890. 1900. 1902. Food . . . Raw Materials Manufactures . £ 11,259 i 22,403 229,869 1 • 263,531 4 9 87 4 •5 81 100 5 18 77 Total . . 263,424 100 IOC * bee Table XXI., in Ap[)i.'ndi.\, lor the details. w. CHAPTER XXXIV. FOREIGN TRADE OF FRANCE. The statistics of the foreign trade of France, giving in the Statistics, same way the value of the imports and exports, and the amount per head of the population for each year and for quinquennial periods since 1854, '^^i'l ^^^ found in Table XVllI. in the Appendix. They may be summarised as follows : — Taking quinquennial periods the annual averages are : — Popukuion ill Import s {s/.c:ial). Kxporls (s/ccM). \ cai i. Millions. Amount in Millions. Per Head. Amount in Millions. Per Head. £. s. d. £ s. d. 1855-9 36 69 I 18 4 76 2 I 11 1860-4 37 92 2 9 I 96 2 II 4 1865-9 38 119 328 120 3 2 11 1870-4 36 137 3 15 8 135 3 15 1875-9 37 160 4 6 7 138 3 14 II 1880-4 37 191 5 I 4 138 3 13 5 1885-9 38 167 4 6 10 133 3 9 3 1890-4 38 169 480 '37 3 II 4 1895-9 38 164 450 144 3 14 II And for each (;f the lollowing years : — \'eai^ Imports E.'C ports {special). (s/'ictal). i £ millions £ millions 18S0 201 139 1881 19s 142 1882 193 143 1883 192 138 1884 174 129 1898 179 140 1899 181 166 1900 188 164 1901 175 161 ) 1902 170 1 170 200 FREE TRADE V. FAIR TRADE. In 1902 the trade per head of France and the United Kingdom, reckoning among exports only those which were the produce of the respective countries, was : £ s. d. France 8 17 7 United Kingdom 19 6 11 Tiiese figures in themselves, however, are quite misleading, since they take no account of some ^^90 millions earned by British shipping, earnings which represent "export of services," to say nothing of other exports of services. The sea-carriage of goods is an essential and most important part of the trade of this country, employing much capital and energy which are necessarily not available for other purposes. Here again imports liave increased in each successive quinquennial period, and exi)orts have also increased. There is a remarkable difference from the English figures in the fact that the imports did not exceed the ex])orts in the earlier years. They began to do so in 1867, but the exports began again to exceed the imports in 1872, the year in which France was beginning to pay the German indemnity, and continued to exceed the im})orts until 1876. Since 1876, the imports have largely exceeded the exports. During the five years ending with 1884 English trade has held its own better than French trade ; nor does it appear that English trade with France has fallen off in these years more than the trade of other countries, or that English goods arc displaced from the French market. The trade per head of France has increased faster than the trade per head of England, but is still about one-half this amount. But during the jwriod embraced in this table, the pojjulation of the United Kingdom has increased, as we have seen, by nearly one-third, whilst the population of France has remained nearly stationary, ])artly. no doubt, in consequence of the loss of Alsace, but also from other causes. In comi:)aring the aggregate trade and the trade })cr head of the two countries this fact must be borne in mind. It is important as showing how much more the foreign trade of England has done for England than the trade of France has done for France. Our direct imports from France, as is well known, exceed our direct exports to France, and this they do by an PART II. — RETALIATION. 201 amount which exceeds anything due to us for freight and Imports profit. But whatever the explanation of this excess may ^orts^from be, the proportion borne by exported British produce to and to French imports has increased rather than diminished since France the French Treaty, whilst the actual amount of English since*^^" ])roducc exported lias tripled, thus showing that the excess Treaty, of imports is not due to the character of the Treaty tariffs. The figures are as follows : — Average of 1 hree Years. Imports /rom France. British Produce exported to France. Re-F.xports to France. Total Exports to France. 1857-1859 . 14 millions. 5 millions. 5 millions. 10 millions. 1S78 -1880 . 1881 — 1S83 . 1884-1886 . 1887—1889 . 1890—1892 . 1893-1895 . 1896— 1898 . 40 39 36 ,. 4> „ 44 44 51 >5 '7 15 14 16 14 14 12 12 ,, 8 8 7 6 6 27 «> 29 23 22 ,, 23 20 ,, 20 ,, 1899 — 1901 . 53 J7 7 24 1902 5' 15 7 22 ,, The total exports from France, distinguishing food, raw materials, and manufactures, according to the French statistics for i86g, the year before the war, and for 1879, may be distinguished as follows : — E.xpoits from France in 1869 and 1879. KxpuKTs oi" Dmucsric I'lNonucK from P'ranck.* Amount in Thousands of Pounds. Percentage. 1869. 1879. 1869. 1879. I'ood ...... Raw .Malcri.-xl ..... Manufactures ..... 34-017 21,482 70,504 £ 33.159 25,210 69.515 27-0 17-0 56-0 26 19-8 54-2 Total 126,003 127,884 100 1 100 .'Sec Tab'.c XXII., in .Appcndi.v, for the details. 202 FREE TRADE J'. FAIR TRADE. The figures for the three years 1SS9, 1899, 1900, are as follows: — Duties imposed by France on Articles used in Manufac- ture. Aiiioun in Millions of/;. Percentage. 1889. 3.rs 41-9 m 1899. igoo. 1889. 1899. 1900. Food . Raw Material Manufactures 270 53-1 , 860 1 308 47 5 860 22 6 29 48-4 100 i6-2 32 "O 5«-8 100 187 28-9 52-4 Total . 148-1 i66-i >64'3 ICO The value of manufactures exported from France there- fore actually decreased in the decade ending with 1879, and its proportion to the value of food and raw materials exported decreased also, whilst the whole exi)orts re- mained about the same. In fact, the trade has been stationary, whilst the English trade has largely increased, as shown above. If to the above list of exports we were to add shipping and freights, we should find that the exports of England have increased much faster than ihose of France. For the excess of imports to this country which has increased, various reasons have been suggested which may be summarised thus : — the crediting to France of goods wliich the French figures show to be merely in transit from Italy, Switzerland, or elsewhere ; difference in valuation between goods valued at port of entry and port of shipment ; the payment of interest on loans to, or investments in, France ; earn- ings of British ships ; and the indirect settlement of international accounts, e.i^. France imports about ^5,000,000 more from both China and India than she exports thither, while England exports to both these countries far moie than she takes fron) them. Half the articles on which duties are imposed by the French tariff are articles to be used solely or j)rincipally in iurther manufactures — e.g. yarns of all kinds, cotton, silk and woollen, unbleached cloths, combed wool, iron and steel of all kinds, copper sheets and wire, coal, alkali, salt, tiles and bricks, and leather ; whilst amongst all the rest are articles which conduce not less materially if less directly to production, by improving the condition of the workman, or by facilitating the conduct of business. I might go PART II.— RETALIATION. 203 through most of them, and show how France manages by imposing a Protective duty to countervail her own natural advantages of soil, climate, and human character, or to enhance her natural difficulties ; whilst freedom from the weight of duties in our case enables us to take advantage of her deficiencies. I have elsewhere* referred to the duties France has lately imposed on agricultural products, on corn, flour, beasts, and meat, thus raising the cost of living to the artisan, and showing that if a nation begins by protecting manufactures it must end by protecting food. I have also in a subsequent chapter! made special reference to the present depression as it affects France. The special cases of leather, silk, sugar, and shipping I have also noticed more particularly below. J CHAPTER XXXV. GERMAN TRADE IN RECENT YEARS. The excellent reports recently made by our Ministers and Official Consuls upon the trade of Germany give us much valuable fjfof^^ information and enable us to supplement the statistics. § interest The case is full of interest and also full of warnings. It ^"^j,; contains a warning to those Free Traders who have been unwise enough to attrilnitc our commercial prosperity to Free Trade alone, and who have been content to rest the case against Protection on this argument. It is an un- doubted fact that German manufactures, both for home consumption and for export, have largely increased during the last five or six years ; and that this increase has been coincident with the adoption of a Protectionist policy. It contains a warning to our own manufacturers, whether * See Cliiiptcrs XXV. and LI. t See Chapter XLI. t See Chapters XLVI.-XLVlll. f See Part II. of Second Report of Committee on Depression of Trade, c. 4715, i., pp. 157 to 199; also Mr. Slrachey's Report on the l^ffect of the German TarilT, c. 4530 {1885), pp. 1 to 75. 204 FREE TRADE V. FAIR TRADE. capitalists or labourers, that if they wish to compete successfully with Germans, not only in German but in neutral markets, they must not fall behind the Germans in technical education, in thrift, in industiy, in pushing powers, and in readiness to learn and meet the wants of customers. It contains a warning to inquirers on this sub- ject that in considering whether depression exists, they must go beyond the word depression and find out what it means, and that they must not mistake growing exports for successful trade. On this point I have dealt more fully below. Lastly, it contains a further warning to inquirers that in reading and drawing conclusions from the published statistics of trade between the two countries, or from the official reports, valual^le as both are, great caution must be exercised. For instance, statistics of export from this country to Hamburg comprise goods not meant for Ham- burg or Germany, as there are no means of distinguishing goods intended for consumption in Germany from goods in transit ; and statistics of trade to or from Germany may appear under the head of Belgian or Dutch exports or imports — as much of the trade of Germany goes through Belgium or Holland. And if statistics need accurate inter- pretation, official reports nuist not alwaj's be taken for gospel. Thus, for instance, Mr. Mulvany, our Consul at Diisseldorf, to whose practical knowledge Mr. Scott, the Consul-General, bears ample testimony,* is of opinion that the welfare of the working classes in Germany has improved immensely, owing to the wise policy of the German Govern- ment in giving up Free Trade ; that landowners and farmers have suffered ])\' the low price of foreign imports that it is fortunate for Germany that American bacon has been all but jnohibitcd, and that the value of land will soon be quite re-established by moderate Protective tariffs. Such an opinion from a British Consul would seem to deserve attention. But when wc find that Mr. Mulvany is the son of an Irishman who has set up successful iron- works in Germany, and who has been a strong promoter of the imi)ort duties l)y which those iron-works are pro- tected from English com]ictition,t we cease to attach so * App. Part II. lo i-"ccond Repcit of CcmtTiiitce on Depression of Trade, pp. 170, 171. f I)itlo, p 171. PART II.- RETALIATION. 205 much value to his report. Nor is it only in matters of opinion that caution is necessary. For instance, Mr. Strachey, Her Majesty's Charge d' Affaires at Dresden, whose valuable report on the effect of the German tariff * would be even more useful than it is if attention were less distracted from its substance by the ambitious brilliancy of its style, rejects with scorn the suggestion that the German Government favours German exporters by charging them lower freights than are charged on imported goods. f But, on the other hand, we find in the synopsis of answers from the Consuls, J statements as the following, positive statements, that " Reduced rates are given for through freight of certain goods to certain ports on the North Sea " ; " Differential freights have been established favouring exports of coal, salt, spirits, etc." ; " Low freights are given on State railways to German coal, etc. etc." — statements I may add, which are amply confiimed by reports from other sources. The history of German trade during the last twenty History of years may be shortly stated as follows § : — Before 1866 ^^'"'1'^" Germany was a patchwork of different States, and exported agricultural produce. Between 1866, the year of the Austrian war, and 1869, her manufacturing industry was largely developed, and her agricultural imports came to exceed her exports. After the French war in 1870 Ger- man unity was confirmed and extended ; the national spirit was further awakened ; the industries of Alsace and Lorraine were added to the commercial resources of the Empire ; internal barriers were removed ; coinage, weights, and measures were reformed ; the railway system was re- vised and consolidated ; a new commercial code was passed ; two hundrctf millions sterling was passed into the country by France in payment of the indemnity ; and German trade received an un})recedented stimulus. The consequence was an immense develoj)ment not only of sound enterprise but of wild speculation, followed, in * Pari. Paper, c. 4530 (1885), p. 1. t Appendix to Part II. of .Second Report on " Depression of Trade," Mr. Scott's Repoit, p. 194. t Ditto, p. 187. f Ditto, p. 158. Sec also Mr, Strachey's Report, Pari. Paper, c. 4530 (1885). 206 FREE TKADK t'. lAlR TRADE. 1874-8, by the inevitable collapse. During this period Free Trade was in the ascendant, and it is probably a misfortune that in 1877, just as the collapse was becoming acute, such duties as remained were further reduced. During this period of Free Trade the iron manufacture and exj^orts rose rapidly, while imports of iron fell off.* The collapse in prices led to a cry for Protection. In 1878 an Imperial Commission was appointed to consider the subject, and the Protectionist tariff of 1879 was the consequence. It is right to add that this ta.hfi was not entirely due to the demand for Protection. The German Government was in need of revenue, and, owing to the peculiar constitution of the Empire, it was difficult to raise it except by indirect taxation. After the adoption of this tariff came the temporary revival of 1879-1880, which was felt in Ger- many as well as elsewhere, followed in later years by a period of large business but low prices. The tendency to Pro- tection is still in the ascendant and seems to be growing in strength. Though there is a strong party in favour of Free Trade, the Protectionists have the upper hand. Article after article has been protected ; the tariff of 1885 is much higher than that of 1879, and it includes a heavy tax on foreign corn. Protection has followed its usual course. Each step has made a further step un- avoidable, until at last the food of the people, the j)rime necessary of industrial life, and formerly an article of export, is made dearer and scarcer by a heavy import duty. If we ask what has been the state of trade and manu- facture during these years, and what it is now, we receive answers which show a large increase of business. The statistics of German trade can, as above stated, only be given since 1872, and changes in them, which were made in 1879, render the comi)arison of previous with subsequent years less satisfactory than it would otherwise be. Such as they are, the figures are given in the table, No. XX. in the Appendix. Taking a jieriod of three years from 1872, and quin- quennial periods subsequently, the figures for Germany are as follows : — * Strachey, c. 4530 (1885), p. 4. PART II.— RETALIATION'. 207 Population in Millions. Import s {$/•(, ial). Exports {special). Annual Average. Amount in Million C- Per Head. Amount in p „ ^ Million £. 1872-4 1875-9 1880-4 1885-9 1890-4 1894-9 41 42 45 47 49 52 ^11 184 154 163 202 237 £ s. d. 463 4 6 I 3 8 3 3 9 5 422 4 10 7 116 n^ 155 158 155 184 £ s. d. 2 16 7 330 3 8 8 3 5 6 329 3 10 7 And for the following \ •ears : — Years. Imports Exports (special). (s/ectal). £ million. £ million. 1880 141 145 1881 148 149 1882 156 160 1883 163 164 1884 163 160 1898 254 188 1899 27* 210 1900 288 231 1901 279 222 1902 2S2 234 Since 1872 our own imports have increased faster than those of Germany, but her exjiorts have increased faster and more than ours. During the last five years both her imports and exports have lield their own better than ours, and better than those of France. The imports of Germany were larger from 1872 to 1879 than they have since been : her exports steadily increased from 1872 to 1883. From 1872 to 1879 her imports largely exceeded her exports ; from 1880 onwards her ex})orts and imj^orts have been nearly equal. The excess of imports in the earlier years is probably due to the payment of the French indemnity. The absence of any such excess in more recent years is very remarkable when considered in connection with the further facts to which 1 shall have to call attention. Germany has again a very considerable excess of imports dating from 1888, and amounting in 1901 to nearly ^59,000,000. 208 FREE TRADE V. FAIR TRADE. During the period embraced in these returns we iind that there has been an immense develoj:)ment of manu- facturing industry, which is still progressing. The general export figures are given above. The production of })ig iron in Germany increased from two and a quarter millions of tons in 1873 to upwards of three millions and a half in 1884, whilst in the United Kingdom it increased in the same time from upwards of six millions and a half to seven millions and a half.* The returns for Great Britain in 1884, as comi)ared with 1883, show a decrease of production of iron, whilst those for Germany show an increase. f The average production of pig iron for the years 1896-1900 was for the United Kingdom 8-9 million tons, and for Germany 74 million tons ; of raw cotton Germany imported 790 million cwt. in 1900. The net imports of raw cotton i into Germany increased from upwards of 25 million cwt. in 1877 to upwards of three million cwt. in 1884. The net imports of raw jute in- creased from 236,000 cwt. in 1877 to 668,000 cwt. in 1884. Meanwhile the exports of woven goods increased, whilst the imports diminished. The same thing is true of many, if not most, other articles. As regards British trade with Germany the aggregate has increased, but its proportion to the whole trade of Germany has decreased. § British manufactured articles have been displaced in Germany by German products, more especially in iron, in textiles, in chemicals, II and in cheap glass and pottery.^ German goods are rivalling English goods in neutral markets, and are being sold in our own. They are being imported to England, and some are re-exported as English goods. The Germans rival us successfully in cheapness, though not generally in excellence. Nor arc we alone. French imports into Germany have suffered more by German competition than our own. As between 1SS0-S4 and 1S96-1900 Geiman imports to England increased by ^'3, 702,000, or nearly 15 per cent. A decrease in the imports to the extent of /'i, 558,000 worth of live animals for the meat market was occasioned by the Board of Agriculture prohibiting these imports, and an increase of /3, 349, 000 worth of sugar resulted * Slrachey. c. 4530, p. 8. t Ditto, p. 7. J Ditto, p. 47. § ScJtt, c. 4715, i., p. i6o. II Ditto, p. 160. 11 Strachey, c. 4530, pp. 63-65. PART II.— RETALIATION. 209 from the sugar bounties. Balancing these special increases against these special decreases, the Board of Trade memorandum shows an ordinary increase of /i, 91 1,000 in direct impcrts from Germany. There were increases in the imports of cottons and woollens. Of the former our average imports for 1896- 1900 from Germany were ^^678, 000, and in the same years our average cotton exports to all countries were /58, 000,000, while of woollens we took from Germany ;^i,048,ooo worth, and exported to all countries ;/^i 5,700,000 worth- Of iron and steel manufactures, including machinery and cycles, our average imports from Germany were worth ;^89l,oco, and our exports locally manufactured were worth ^49,ooo,ooo. Thus it is clear that, though Germany has gained some footing in our market, she has not ruined British industry in the articles of which we buy some German specimens. As regards the recent period of depression, it appears Depression that since 1882 large concerns have been increasing their '" ^^^' business, whilst smaller concerns are still unable to make '^'^^'^• way against difficulties. When the question is asked whether there is depression at present, it must be answered by another — viz. what is meant by depression ? If by depression is meant diminution in the volume of business, it cannot be said to exist, except perhaps in particular trades and in particular places. At Konigsberg, Memel, and Breslau the loss of the grain trade has caused loss of business. Sugar, iron, chemicals, and shipping are all suffering everywhere from glut and over-production, and it would seem that business in these articles is contracting. But, speaking generally, the mass of articles produced, consumed, and exported is large ; employment is brisk, and wages are comparatively high.* These statements show that German powers of pro- Advance in duction have made immense advances within the last T)^^c'i^^"nd twenty years, and that in the last five or six years they its causes, have not been more crippled or restricted than our own. If we were to treat a policy of Free Trade on the one hand, or Protection on the other, as the sole cause of com- mercial prosperity, these statements would afford a strong argument against Free Trade. But the policy of legis- lative interference with trade is only one of many factors. We have, for instance, in these reports, a number of other * Scott, c. .}7r5, i., p. 159. 210 FREE TRADE 7'. FAIR TRADE. considerations insisted upon, which are quite sufficient to account for the development of German trade. I can only mention them shortly, referring to the reports for greater detail. They are : — ist. The energy thrown into business by the accom- plishment of national unity and the development of the national spirit. This has been the motive-power of every other change. 2nd. The unification and improvement of laws, of weights and measures, of coinage. 3rd. The excellence and cheapness of internal carriage by land and water. The purchase of German railways by the State, facilitated by the French indemnity, has enabled the Government to reform and lower railway rates. 4th. The absence of strikes and agitation among work- men. 5th. The rate of wages, which, though much higher than it was, is still lower than the English rate. The Melbourne J^e — most rabid and most influential of Colonial Protectionist newspapers — sees ruin to English industries in the high wages of her working men under Free Trade, and on April 22nd, 1901, wrote thus : '* And the outlook for the future is anything but reassuring. The cost of the production of all descriptions of manufactured goods has largely increased of late in the United Kingdom, owing to the advance of the wages that have to be paid to workers and to the amelioration in labour conditions resulting from recent legislation." The Ji;e quotes very striking figures from the report of the Board of Trade as to the rise of wages in 1S9S, 1S99, and 1900, going on to moralise as follows : " When allowance is made for the shorter hours of labour in addition to the increased wages, it will be readily under- stood that the difficulties of the manufactuiers of Great Britain in their competition with the protected foreigner have been materially increased. The important point is. What steps should be taken to meet this crisis ? " The A^es answer to its own question is, Impose Protection and re- duce wages. Without this step, however, British manufacturers seem to be surmounting their difficulties, and the first half of 1903 shows a record export of nianufactuied goods, their value for the six months being ;^i 16,364,792, as against ;i^i 15,900,000 for the corresponding period of 1900, which was the best half-year until 1903. 6th. The prevalence of thrift and industry amongst employers and employed. PART II. — RETALIATION. 211 7th. The excellence of the technical education given in the public schools. Last, but by no means least, the pains and skill evinced by German traders in pushing their wares and in adapting their goods to the wants of their customers. Their agents are ubiquitous, and their efforts in search of custom as incessant as they are ingenious and varied. On this point Mr. Scott's remarks are well worth the attention of English manufacturers. He is speaking of the German market, but what he says is equally true of other markets. Our representatives in all parts of the world are unanimous on this point. He says : "It seems to be a subject of very general complaint that English pro- ducers are imperfectly acquainted with the requirements of the German market, and unwilling to alter their standard of supply to meet them ; they are said to be entirely dependent on the middleman for this very requisite in- formation ; and the English dealer, on his side, is believed not to have as yet realised the fact that the day has gone by when the German consumer was content to take the supply which the English dealer thought the best for him ; that the German market has now got a standard of its own, and one not to be despised, which native producers are quite able to attain to. If, therefore, British producers think the German market worth supplying, they should make greater efforts to ascertain the exact nature of the German demand more directly and promptly than they do at })resent, and be prepared with a suitable supply of goods."* In short, the German manufacturer seems to neglect no means of pushing the sale of his own goods and ousting his rivals. It is by the legitimate means of thrift, skill, and industry that his real successes are won. But he does not neglect less legitimate methods. Thus we are told that he copies his rivals' designs, and that he appropriates his trade marks. He exports pig iron marked " English Foundry No. 3," and so-called " Low Moor Plates. "f He makes German cutlery and sends it to England to be re- exported to America with English trade marks. | He * Scott, c. 471 s. i-i p. i6i. t SiraclKv, c. 4530, p. 16. i Ditto. 212 FREE TRADE V. FAIR TRADE. makes surgical instruments, sends them to England, and re-imports them with English names.* He makes " genuine " Leicester articles in Germany, and exports them to England with English labels.f The inferior Ger- man writing paper is made with English water-marks. J German potters copy our best makers, bring out scamped facsimiles at half our price, and export largely, competing with us by this means both in our own and in the American markets. § German candles are inferior to English, but they are labelled " candles " or " fine candles," and are made up in English pounds. || Birmingham, it is true, follows suit in imitating Berlin, but is, in Germany, promptly repressed by German law.^[ Such practices make it sound strange to hear that a habit is growing in Germany of treating competition " not as a legitimate and indeed essential wheel of the great industrial machine, but as a malignant force of modem depravity which is the peculiar resort of capitalists, Jews, and English manufacturers." It is odd enough to hear such terms as " an infamous breach of honesty," " piracy," and the like, applied to successful trade com- petition by a foolish Socialist professor, but to hear them applied to the importation of Nottingham thread by a German thread-maker is indeed amusing ! ** With all these factors at work, the Protective tariff of Germany is but a small thing in comparison with other factors, more especially if it is remembered that, bad as it is and much as it is growing, it is very far indeed from being prohibitory. Indeed, there is in the want of in- direct revenue felt by the German Government a guarantee that Protection will never be carried to the extent of jn'o- hibition. As regards the actual effect of the German Protective tariff, it is extremely difficult to disentangle different causes and effects, so as to trace its operation with any degree of certainty. But there are certain features in the accounts we have of German trade which point to the conclusion that Protection has in Germany, as elsewhere, been both useless and mischievous. * Slrachey, c. 4530, p. 13. f Ditto, p. 23. X Ditto, p. 62. \J Ditto, pj). 63-64. II Ditto, p. 53. 11 Ditto, p. 38. ** Ditto, pp. 23, 24. PART II. — RETALIATION. 213 In the first i)]ace, it seems clear, as a matter of history, that whilst the moderate Protection given by the tariff has fostered some forms of industry into a quicker develop- ment than they would have attained without it, it has not been the sole or a chief, or indeed an important, factor in developing German manufacture generally. From Mr. .Strachey's very interesting report it appears that during the years prior to 1879, in which the Empire was progressing towards Free Trade in iron, and during the years in which Free Trade was an accom}:>lished fact,* the iron industry of Geimany, perhaps the most important of all, was rising rapidly in importance ; that the iron exports were in- creasing, and that they were entering into serious com- petition with the produce of England and of Belgium, whilst at the same time the imports were decreasing. The crisis which followed this growth, and which was the origin of the Protective tariff, was common to the whole world. As Mr. Strachey tells us, the iron duties were re])ealed when the great cosmic crisis which followed the German struggle with France was in its acutest phase, and they were re- imposed just as the bottom was reached. Thus the adoption of the tariff of 1879 ^^'^^ coincident with the l)eginning of recovery, and it is impossible to distinguish between the effects derived from Protection and the development due to the natural vitality of the iron trade. Again, as to textiles, Mr. Strachey tells us that in 1878, just before the date of the Protective tariff, it wa^ proved, before an Imperial Committee, that in most of the leading staples native German industry commanded the home markets ; that Germany had as good as no import of the articles which constitute the bulk of the cotton manu- facture, and that there was a large and growing export. t So with knitted fabrics, the success of Chemnitz over Nottingham is not due to the tariff. J As regards woollen goods, we find that in the period which preceded 1S79 the German weavers were to a great extent masters of the home market in woollens and worsteds. § As regards linens again, English manufactures, before the tariff of 1879, scarcely entered Germany, and there was a large export of * Strachey, c."4530, p. 4. j Ditto, p. 23. t Ditto, p. 21. § Ditto, p. 31. 2T4 FREE TRADE V. FAIR TRADE. German linen.* In these cases the new tariff merely accelerated the process which was already going on. Upon jute manufacture it had a greater effect. | The great success of Germany in mixed silk goods is due to their skill and not to the tariff ; J whilst their victory over Lyons, so far as it is due to legislation, is owing, not to the German Protective duty on German silks, but to the high Protective duty which France has imposed on foreign cotton yarns. So far as the German tariff is concerned, it checks its own silk manufacture by a similar duty, but one of lower amount. Chemicals, again, in which Germany has been especially successful, receive little Protection and some hindrance from the tariff.§ Her large manufactures of leather, wood, paper, pottery, and glass owe little or nothing to it.|| In short, it is clear that German manufacturing in- dustry generally was making great p)rogress under a system of Free Trade ; and that the utmost that can be claimed for Protection is to have given additional stimulus to some branches of it. Cotton spinning appears to be an interest which has benefited more than most by Protection,^ and we shall see presently what the effect of this benefit is on other industries. Under these circumstances it is, to say the least, extremely doubtful whether even in each pro- tected industry growth and }:)rogress would not have been as great without Protection as it has been with it. But this is only a small part of the question. No one doubts that a single special interest may be fostered by a Protective duty. The real questions are, What is the effect of such a Protective duty on other interests ? Whether any single interest can be protected without involving Protection for others ? And what is the hnal effect of Protection on the production and consumption of the country ? Fortunately, we are not without means of giving an answer, however imperfect, to these questions. In the first place, it is clear that the duties by which Germany protects particular manufactures do interfere with other manufactures, and are complained of, perhaps more loudly than the facts warrant. Thus, makers of * Strachey, c. 4530, p. 32. t Ditto, p. 36. X Ditto, pp. 40, 43. j; Ditto, p. 48. II Ditto, p. 66. ^ Ditto, p. 26, PART II. — RETALIATION. 215 machines and of all sorts of goods made with iron and steel complain of the duties on those metals, and find or seek compensation in Protective duties on the articles they make.* The duties on cotton yam have stimulated cotton spinning, but take from the weavers as much as they give to the spinners,! ^^id the export commodities of Germany are at a great disadvantage in the markets of the world with the cottons of countries in which yarns are untaxed. The taxation of cotton yams also injures the weavers of mixed goods, whether of woollen or silk. J The taxation of woollen yarns injures the weavers of wool.§ The taxation of linen yams injures the weavers of linen. || The makers of clothing complain of the duties on linen, woollen stuffs, etc.^ Alizarine-makers need soda, and soda is taxed.** Strontium is of value for the most depressed of manu- factures, that of sugar, but, at the beck of two or three Westphalian miners, strontium is taxed. ft The makers of soap, perfumery, candles, and varnish require oils ; but German oil-makers must be protected. J{ The makers of essences and liqueurs complain of taxes on seed^§§ Leather- dressers complain of taxes on articles used in tanning.|||| German timber is protected, and the vast number of trades which use wood cry out.^^ Paper suffers from the tax on chemicals.*** Whatever the actual effect of all these Protective taxes may be in restricting and repressing manufacture — and in many cases it must be considerable — the complaints made by the manufacturers are unanswerable in point of prin- ciple, and they are met, not by removing the duty on the material, but by giving the finished manufacture the pro- tection of a higher duty. Germany is like France and Canada, a practical illustration of the universal truth : that Protection takes from one at least what it gives to another, and that if a nation begins by protecting one interest it must go on protecting others until the charmed circle is comjilcte. * Strachey, c. 4550, p. 17 '] Ditto, pp. 30, 32. \^J Ditto, p. 54. t D.lto,. pp. 22-26. ** Ditto, p. 48. Illl Ditto, p. 57. i Ditto, pp. 29, 43. ff Ditto, p. 5r. HII Ditto, p. bo. ^ Ditto, p. 31, 11 Ditto, pp. 52, S3> ^l- *** Initio, p. 62. II Ditto, p. 33. 2l6 FREE TRADE V. FAIR TRADE. If this is the effect of German Protection on the materials used in manufacture, what is its effect on the German con- sumer ? There is ample evidence in these rejwrts that the prices of many, if not of most, manufactured articles are higher in Germany than in countries which have no Pro- tective tariff. This, we are told, is the case with steel rails ; * with cotton goods, which to persons accustomed to London prices seem enormously dear ; f with woollen goods ; J with linen ; § with chemicals ; || with articles made of leather ; ^ with pottery ; ** and, as we know so well, with sugar. In short, the German consumer suffers as the consumers in other Protectionist countries do from Protective duties. Life is made dearer and less pleasant to him. For readers in this country it is needless to labour this point. Free Traders or Protectionists, we have all of us, I hope, except a few Fair Traders, got beyond the astounding doctrine that Protection raises prices to the seller without raising them to the buyer — a doctrine with which German Protectionists seem still to console them- selves. About German consumers, then, there can be no doubt. But how about German producers ? Are they not doing well ? If we find that prices in Germany, if not high, are yet in many cases higher than they are in England ; and if at the same time the volume of business in Germany is large and constantly growing larger, we seem to have the elements of great pros]>erity for producers. Do the reports bear this out ? Quite the contrary. If there is one feature in these reports on which all the reporters are unanimous and which applies universally to all branches of trade, it is that business, though large, is unremunerative ; that })ro- fits are nothing or next to nothing ; that there is a general glut of manufactured articles ; and that the only hope for manufacturers is in some new market, some fresh demand which shall raise jnices and make it worth while to go on producing. If this is what is meant by depression — and it is really what is meant by it in this country — there can • Strachey, c. 4530, p. 14. ^ Ditto, p. 33. H Ditto, p. 57. t Ditto, pp. 21, 26. II Ditto, p. 51. ** Ditto, p. 63. :J Ditto, p. 32. PART II. — RETALIATION. 217 be no doubt that it exists in Germany to as great an extent as it does in England. It is almost superfluous to quote authorities. But I may quote one or two extracts from recent newspapers. In the Times of 21st July, 1886, occurs the following statement : — " An additional proof is afforded of the critical position into which the German iron industry has fallen, by the announcement that the large rolled iron concern of F. Remy, of Dortmund, has suspended pay- ment. . . The fact that in a recent contract for steel rails at Altona the lowest German tender was underbidden by one from England has caused absolute alarm. Hitherto, owners of German works have been able to recompense themselves for low-priced foreign contracts by keeping up ]:)rices at home." And again in the Ironmonger of 14th August, 1886, I find the following : — ■" More than thirty German Chambers of Commerce have expressed in their annual trade reviews for 1885 their conviction of the necessity of reverting to a more liberal foreign commercial policy. The Chambers of Carlsruhe, Darmstadt, Miin- ster, Leipzig, Hanau, and many others, complain of the injurious consequences of the Protective system. It is also regarded as significant that the organ of Prince Bis- marck reproduces })rominently a })ortion of the Leipzig report, in which the Government, whilst congratulated on its opposition to the bimetallists, is urged to reverse its ]:)resent commercial policy." The consular reports all tell the same story. In the three great articles, iron, sugar, and chemicals, the depression is very great * — greater, probably than in England or elsewhere. As re- gards trade generally Mr. Scott says that " the returns tell us that the return on capital is everywhere steadily de- creasing. Prices of products in nearly all the chief branches of industry have been steadily falling, and the profits of producers and middlemen are being reduced in many in- stances to a minimum. . . ." The report of the general Handelstag of Germany has summed up the descrijition of 1883 in five words : " From maximum exertions minimum profits." " General over-production — or, rather, the general belief in the existence of over-production — is spoken of as the one great cause." Mr. Mulvany, who has, we have * .Scott, c. 4715, i., p. 159. 2l8 FREE TRADE 7). FAIR TRADE. seen, such a firm belief in the recuperative effects of Pro- tection, says, nevertheless : * " The depression of trade, or, perhaps more correctly speaking, of prices, is notorious." " The greater portion of capital invested in industry yields little or no interest, only a small portion a fair rate, and none a high rate." " A continuance of depression may become dangerous to master and man." From Konigs- berg I the report is that depression has reached its lowest point, and that it is caused by increased competition, very slow sale, and very small profits, often disappearing in loss. From Saxony we learn that | " the depression is almost universal, and there are scarcely any branches of pro- duction which it has not reached." From Wiirtemberg : " The volume of transactions shows progress. The profits earned seem to decrease in a corresponding ratio."§ We have, then, increased production ; increased exports ; prices higher at home than abroad ; and, at the same time, aggre- gate profits decreasing so much that in many cases they approach or even reach zero. Goods are To this remarkable state of things we have to add one abroad and Other fact, which secms to me to be very significant. The dear at German manufacturer is selling cheap abroad, and keeps his head above water by selling dear at home. Of this there can, I think, be no doubt. Mr. Scott says : || " The producer, in order to keep a grasp of foreign markets and to keep his business going, is throwing it into foreign coun- tries at unremunerative prices, in many cases lower than those at which he places it at home. ... As he has in many branches at present the practical command of the home market to the almost entire exclusion of foreign com- petition, he is able to go on increasing his production for the present in spite of diminished profits, but it would re- quire more than ordinary temerity to make a forecast of his future." Mr. Mulvany tells us that the German manu- facturers are " steadily pushing their products into the markets of the world — it is true, in many cases without any profit — indeed, on large quantities, exported at a dead loss."^ Again, according to Mr. Strachey, the existence of * Scott, c. 4715, i., pp. 169, 170, 171. t Ditto, pp. 182, 185. I Ditto, p. 193. f Scott, c. 4715, i., p. 195. II Ditto, p. 160. II Ditto, p. 170. liome PART II. — RETALIATION'. 219 a double scale of prices, one for home buyers, another for foreigners, is a common, if not a general fact. The following are instances : — As regards iron (the production of which appears to be about 2'8 million tons, and the home con- sumption about i'8 million, leaving i million for exports)* we are told that the magnates of Essen and Bochum formed a coalition which secured the sale of their goods in Germany at prices far above English, while in foreign markets they were flinging their rails away ; f and, again, that the Protective duty has enabled the German rail- makers to combine to fix home prices which are, or have been, fully 25 per cent, above their terms for foreign markets. J And, again, that the Chamber of Bochum re- ported that in 1882 the foreign trade was hardly profitable, and that German producers habitually accept for goods sent abroad prices lower than they will take from home dealers. § Again, with respect to some important chem- icals, in which there has been great over-production, Mr. Strachey says that the German makers keep up their prices in the home market to an artificial height by a trade con- vention, and, in the usual manner, throw their remaining supplies abroad at the lowest prices. || Again, in the manu- factures of articles of leather, in which also there is a glut, export prices are systematically lower than those taken from the home purchaser.^ In pottery the consignments for foreign markets are made 15 or 20 per cent, lower than the dealings in Germany. And finally we know — as shown below in Chapter XLVIII. — that the German Government pays its sugar j^roducers a bounty of at least a million a year, which operates as an inducement to them to sell sugar to Englishmen at half the price which, thanks to the duty, they are enabled to charge to their German brethren. This is surely a very remarkable state of things. It is quite intelligible that a trader should sell some goods at no profit in order to obtain custom in other and more profit- able goods ; it is quite intelligible that a manufacturer should here and there, and by way of excejition, sell sur- plus stock without })rofit — or even at a loss. But that the mass of traders of any nation should habitually sell * Scott, c. 4715,1., p. 139. X Strachey, c. 4531, p. 14. || Sirachey, c. 4530, p. 51, t Strachey, c. 4530, p. 7. ^^ Ditto, p. i8. ' II Ditto, p. 57. 220 FREE TRADE 7'. FAIR TRADE. goods to foreigners at a low price, and should rccou]) them- selves by selling them to their own countrymen at a com- paratively high price, is a practice which, so far as I know, is unprecedented. And that any Government should en- able and encourage them to pursue this j^ractice by pro- tecting them in the monopol}^ of the home market, and should think that by so doing they were increasing the wealth and productive powers of the country, would be incredible of any men out of Bedlam, if it did not seem to be the policy of the present rulers of Germany. To induce manufacturers to sell dear at home and cheap abroad ; to make your countrymen pay for dear goods, and to give them away to the foreigner, is a policy of which our own Protectionists and Fair Traders, however great their absurdities, would be heartily ashamed. With a few trifling alterations as to figures and details all this that was written twenty years ago of German manufactures and commerce might have been written to-day. A period of feverish bu iness activity has been succeeded by a period of acute depression ; while since the introduction of Protection and its subsequent increases there has been a rise in the price of many articles, unaccompanied by any propor- tionate rise in wages. Goods are still sold cheap abroad and deir at home, frecjuently with such results as those described on page 152, where the case is mentioned of a British firm securing a contract ia Berlin for iron work, the iron work being manufactured from German iron sold at high prices in Germany and dumped cheaply in England, to the advantage of British manufacturers. And only a few years ago Mr. E. K. Williams, the talented Protectionist author of " Made in Germany," actually claimed for Proteclion that it *' enables the German to raise his prices to his compatriots and scre^v such a profit from them that he can afford a big reduction in his export prices.'' A concrete example was supplied by the Association of German Wire Nail Manufacturers, whose report, according to the Berlin corre- spondent of the liconoinist, showed that in 1900 it sold 22,307 tons for ^363,837 in Germany, and 19,525 tons for ^^208, 208 abroad, thus letting foreigners have nails at £,\o 13s. per ton, an,l charging their " protected " fellow-citizens £\(i 6s. per ton. Since Lord Farrer wrote, the sugar madness, under which German bounties give cheap sugar to British manufacturers and consumers, while (jermans were charged exorbitant prices, reached such a pitch as frightened even the Germin Proteclionis's, and our Government has lately been obliging enijugh by means of the Sugar Convention tq PART II. — RETALIATION. 221 save foreigners from the consequences of their own folly, and deny British manufacturers the advantage of cheap bounly-fed sugar. Of agriculture nothing has been said hitherto, but it is, Agncuiiuie after all, the greatest interest in Germany. Of the whole ^gpreTstc^i population 42 per cent, are still dependent on agriculture, and 45 per cent, on all other industries put together.* Formerly it played a much larger proportional part. In 1865 a large surplus of grain was sent abroad. The same process has since gone on in Germany which has gone on in other European countries ; manufacture has increased disproportionately to agriculture ; labour has flocked to the towns ; and corn has come from remote quarters of the earth. Germany has become an industrial nation, and one-fourth of her home consum{)tion of grain is now sup- plied from abroad. This process was proceeding very rapidly under the peculiar circumstances mentioned above, before Germany adopted the policy of protecting manu- factures. That policy, whatever its importance as com- pared with other factors in the process, must have acceler- ated it. It must have helped to attract labour from the country to the towns, and have made it dearer and scarcer to the agriculturist ; it must have increased the cost to the farmer and the peasant of all manufactured articles. In the meantime the competition of foreign corn lowered agricultural prices. The necessary result is very gi^eat depression in the agricultural interest. The Prussian Minister of Agriculture reports that within recent years the prices of nearly all agricultural products have fallen 25 or even 30 per cent., while the cost of production has in- creased in the same time 75 per cent.t Nor has the de- pression in cereals been made up for by increase in cattle. Within fifteen years sheep have declined from 28,000,000 to 19,000,000, though pigs have increased, doubtless fos- tered by the exclusion of American bacon. Of late years the town and city population has increased rapidly in proportion to the rural population. In 1S71 the people inhabiting towns of at least 2,000 inhabitants were 148 millions out of 41 mil- lions, or 36"l per cent.; in ibS5 ihey were 205 millions out of 469 * Scclt, c. 4715, i., p. 157. t Ibid. 222 fREE TRADE 7-'. FAIR TRADE. millions, or 437 per cent. ; in 1900 the urban population constituttd 30"6 millions out of 56-4 millions, or 54"3 per cent. '1 he whole increase of population (15! millions) Lelween 1S71 and 1900 was absoibed by the tov\ns, leaving the numbers in the country as thi y were. In the meantime, though the duties on whiat, which were not higher than the recently abolished Biitish duty, were raised from 2s. 2d. per quarter in 1879 to 6s. 6^d. in 1SS5, 10s. ic.W. in 1SS8, with a reduction to 7s. /kl. in 1S92, agriculture has been generally depressed, and the Agrarian League demands higher duties still. With the increase of agricultural protection there has been a great increase of agricultural indebtedness, mortgages increasing between 18S6 and 1897 by about ;^ 120,000,000. The number of sheep had decreased from 19 millions in 18S3 to II millions in 1897, while pigs had increased fiom 9 millions to 14 millions, and horses and cattle from 15! millions to l8i millions. In 1897 the United Kirgdom had 26'3 millions of sheep. Now, if the German Government had not protected manufactures this agricultural depression must have been borne, as it is in England, and the German artisan would have had the full benefit of the new sources of food supply which have, for us and for Europe, postponed the Mal- thusian difiticulty. But the protection given by German laws to other industries made the claim of agriculture irre- sistible ; and the vicious circle of Protection has been com- pleted in Germany, as in other Protectionist countries, by a tax laid on the food of the people. In 1879 ^ duty was laid on grain of about 2s. 6d. a quarter. In 1885 these duties were increased, and ai)i)arently on the average doubled,* so that, the clothes and tools of the j^cople having been made dearer to them for the sake of the manufacturer, their food is now made dearer to them for the sake of the farmer and landowner. Nor is this a trifling matter. If, as is stated to be the case, Germany produces 50 millions of quarters of cereals, and imports 9 millions, a tax of 5s. a quarter on the imported grain would impose on the people an extra charge, not of £2,250,000, which would be the actual amount of the tax on this imported grain, but of ^^14,750,000, by which sum the price of the whole 59 million quarters consumed would be raised. * Slrachey, c, 4530, p. 66 PART II. — RETALIATION, 22$ Of wheat in 19C0 Germany produced 756 million cwt., or 17"6 million quarttis, which, if the duly were operative to ils full amount, as the farmer hopes it to be, would mean a tax of 67 millions upon the rest of the people. In ihe same year Germany imported 25,653,297 quarters of wheat, upon which the duly at 7s. y^d. per quarter would amount to 98 million pounds. The duty, however, by no means always laises the price by its full amount, and the farmer who has sowed a crop on poor soil, perhaps in the hope that the duty will enable him to fleece the consumer to his profit, frequently finds him- self ruined by a heavy fall in the open market or over-production within the protected one. Hence in protected countries the farmer suffers from disastrously sudden variations in price, and never knows what his real protection will be, the Berlin price of wheat, for instance, being in 18967s. 2d. per quarter above that of London, and in 1897 only 5s. lod. above it, the duty for l)Oth years being 7s. jhd. per quarter. That Protection does encourage the use of poor soils for wheat growing is shown by the fact that ihe average yield per acre in Ger- many in 1898 was 24 87 bushels, and in the United Kingdom 3474 bushels. The average prices in London and Berlin respectively being 34s. and 40s. 6d. per quarter, it follows that the money value of the wheat produced per acre was £j 7s. 6d. in the Urited Kingdom and only ;i^6 5s. I id. in (Germany, in .'■pile of the higher price which the German consumer had to pay for his bread. The high price luling in 1898 induced the German farmers to put 116,000 more acres under crop. Ne.xt year the yield was greater by about 11,000,000 cwt., and prices fell by 6s. 9d. per quarter. In the United Kingdom prices also , fell, but the high prices of 1898 had created no false hopes among the farmers, and the acreage under wheat for 1899 was 100,000 acres less than in the previous year. Having thus put together such of the leading features in Conciu- the German trade as the statistics and reports furnish, let ^'°"^ '^°^' us see what lesson can be drawn from them on the subject cerm^i of Protection, premising that in so large, comj)licated, and Trade, uncertain a matter conclusions must be doubtful. Under the influence of circumstances, some of which she shared with other Euroj^jcan nations, whilst others were peculiar to herself, Germany with a Free Trade regime was becoming, and had indeed become, a successful manu- facturing country. In a moment of commercial reaction and collapse she adopted a Protectionist policy. This policy has grown and extended its limits as it has done elsewhere — and, though less intense than in some countries. 224 I'REE TRADE V. FAIR TRADE. it now embraces all, or almost all, products of labour, in- cluding the food of the people. Under this policy certain industries have been exceptionally and unnaturally fos- tered, and this has helped to produce a glut, which makes those industries unprofitable. In other cases of the kind, as in the United States, relief by exportation is impractic- able, because Protection has raised the cost of production. But Germany has met this difficulty in a very remarkable way. Whilst selling dear at home she makes it a practice to sell cheap abroad, and thus maintains her exports. We have found in her statistics of trade the feature, very un- common in the case of a prosperous trading nation, that her imports hardly keep pace with her exports, and do not exceed them. This feature in her statistics might be explained by the fact that she was investing largely abroad, and sending goods abroad to pay for them, as we did in 1872. But it may also be explained by the fact that foreign nations are paying her little for what she sends to them, or, in other words, that the foreign trade, for which she is making such great efforts, is not profitable to her. This latter explanation seems to be the more likely, since it is consistent with the universal complaint that ti'ade, though large, is unprofitable, and with the practice of her traders, who, as we have seen above, make their profits out of their own countrymen, and sell for export at unremunerative prices. This, of course, they could not do without the help of Protective duties. If this is a true account of the maintenance of the volume of German exports during the recent period of depression, we may be annoyed that such a nation as Germany should add to the general dej)ression by fostering unnaturally cheap exports at the expense of her own i^cojile — just as we are annoyed at her disturbing the sugar trade by her system of bounties — but we need not be alarmed. Such a course cannot last. Nor can it make Germany richer or more powerful, for purposes of competition or otherwise. And in the mean- time we get cheap goods at her expense. As nientioneJ before, German imports exceed exports, as do those of all countries in Europe, except the poorest of the great nations — Russia and Austria — and the poorest of the small countries — Bulgaria PART II. — RETALIATION. 225 and Servia ; but in the years 1898 to 1902, when exports increased by ;^5o millions, the great distress then prevalent in Germany suggests that manufacturers were forced to sell cheap abroad the goods for which they could not find a remunerative market at home. During those years, while exports increased by^50 millions, imports showed an advance of £1"] millions only. This is confirmed by the consular report of Mr. Schwabach, IT.M. Consul-General at Berlin, on the trade of Germany in 1902, where it is stated, " Exports both in quantity and in value show higher figures, which may be attributed to the fact that industrial undertakings, find- ing no home market for their output, forced the export trade to the utmost," and further, " it must not be forgotten that the flatness of the whole market led to an export trade which was in many cases unre- munerative, to use no stronger expression." As to the effects of this on British industry, the Board of Trade Report on British and Foreign Indu.stry, 1903, states : " So (ar as concerns the iron trade, the possi- bility of obtaining cheap German steel has materially reduced the demand for pig iron, and Britiih makers of raw steel have by no means had things all their own way. On the other hand, manufac- turers who have been using steel as their raw material, c.;^. makers of tin plates and sheets, have found the abundance of low-priced steel of advantage to the profitable pursuit of their industry, and, indeed, would at certain times have been placed in a position of some dit^culty if they had not been able to reckon on foreign supplies for keeping their works in full activity." The exports from Germany, distinguishing between Exports food, raw materials, and manufactures, for the years 1869 ^o"" and 1879 are as follows : — in*^i869"ind 1879. ExroRTs OF Domestic Produce from Ger.many.* Amount in Thousands of Pountis. Percentage. ti869. 1879. 1869. 1879. Food Raw Material ..... Manufactures 28,356 38.383 43,864 L 37.948 47,283 53.551 25-6 347 397 27-3 340 387 Total 1 10,603 138,782 100 100 * See Tabic XXI II., in Appendi.x, for the details, t The values for 1869 are esliiuaicd only. 226 FREE TRADE V. FAIR TRADE. The proportions of food, raw materials, and manu- factures exported remained much the same during the decade. But it is probable, looking to the facts mentioned above, that the proportion of manufactures exported has since increased. The following are the figures for later years : — Anio ml ill Milli uns. rcrcciilaiic. 1889. 1899. ; 1900. 1889. ■ '899- I90U. Food .... Raw Material Manufactures . 20'0 37 ■! IOl"2 23'9 56 'o 130-4 2IO'3 £ 25"9 6'3 143 '4 I2'6 23*4 64*0 11-4 26-6 62 'o J I -2 !!6-6 62 2 •rotal . I53-S 230-6 ICO 100 100 CHAPTER XXXVl. FOREIGN TRADE OF UNITED STATES. Statistics. The statistics of the foreign trade of the United States, giving in the same way the value of the imports and ex- ports, and their amount per head of the population for each year and for quinquennial periods since 1854, will be found in Table XIX. in the Appendix. Taking quinquennial periods the figures are : — Populalion ill Millions. imports. Ex ports. Years. Amount Per Head of Amount Per Head of in Millions. Populatioo. £ s. ,L in Millions. Population. \ £ s. d. 1855-9 31 59 1 17 8 53 1 13 7 i860 4 31 55 I 14 10 43 1 7 3 1865-9 38 73 1 iS 2 45 I 3 7 1870-4 38 "3 2 18 7 96 2 9 11 1875-9 44 94 2 2 5 124 2 16 3 i860 -4 50 139 2 15 7 165 3 5 >i 1885-9 56 138 2 8 II 146 2 II 1890-4 63 •63 2 II I I »85 2 19 1895-9 69 145 2 III 213 3 I 3 PART II. — RETALIATIOxV. 227 And for each of the following years :— Imports. Exports. Years. . Amount Amount in Millions. in Millions. 1880 136 171 1881 130 184 1882 147 «52 1883 146 167 1884 136 151 1898 124 252 1899 140 251 1900 172 286 1901 166 304 1902 183 282 The following is an analysis of their export trade in E.\|joits of " ■ United States in 1870 and i88o analysed. 1870 and 1880, excluding bullion and specie Exports of Domestic Produce from the United States. Amount in Thousands of Pounds. Percentage. 1870. 1880. 1870. 1880. Food . Raw Material Manufactures 21,660 45,600 8,609 96,694 57,199 17,763 28-6 6o'i II-3 56-3 333 10-4 Total 75,869 171,656 100 100 1 1 1891. . 1900. 1891. 1900. 1 I'ood ..... Raw Malerialt .... Manufactures .... 89,471 71,541 20,711 122,742 III. 582 68,386 302,710 49-2 39 "4 II-4 405 36-9 22-6 Total 81,723 100 100 • See Table XXIV., in Appendi.x, for details. The proportion of nianu- tncturcs exported has probably increased since 1880. I do not give the figures, though they are given in the official U.S. reports, because, as above stated, any analyses of this kind arc useless for purpose of comparison unless made by the same persons and on the same principles. t In the British Trade Journal of ist March. 1886, will be found a good analysis of the manufactures exported from the United States, and a coiu- parison of their exports with our own. 228 I'KKE TRADE I'. FAIR IRADli In tigures for 1891 and 1900 tobacco is included among foodbtufls ; and mineral oils and leather are classed among raw materials. One thing strikes us at once in looking at these figures as compared with those given for the United Khigdom — viz., that whereas our imports immensely exceed our exports, the United States exports have, since 1875, con- stantly exceeded their imports. Two points must, how- ever, be borne in mind. First, that our own export figures do not include the amount of " invisible exports " in the shape of earnings of our shipping, for which we have to be l)aid a very large sum, amounting now to £50,000,000 or upwards, and which has been constantly on the increase ; and, on the other hand, that the United States imi)orts are valued as they are at the ])ort which the goods have left, \\'hereas ours are valued as they are at the port of arrival. Something will, therefore, have to be added to our export figures, and something to the United States import figures, in order to make the comparison a fair one. But even after these additions the excess of imports oyer exports in the United Kingdom is probably nmcli larger than the excess of exports over imports in the United States. These are not figures to alarm us. It is idle to expect that 30 millions of people shall produce as much as 50 millions of people of the same race. The United States are probably, however, at this moment, in spite of temporary depression, one of the most prosperous nations in the world. The source of their prosperity is not far to seek. It is not to be found in those industries which they try to cherish by Protection, but in the raw jiroductions of the fertile soil and climate of their immense territory. They have 50 millions of the most industrious and energetic ])eople in the world ; they have a country as large as Europe, with every variety of good climate, and with an inilimited area of unexhausted soil. They have excellent communication throughout all the parts of this immense area. Besides this, though shut off by their taiiffs from the rest of the world, they have absolute Free Trade within their own borders. It is as if there were no custom houses on any of the land frontiers of the different States PART II.— RETALIATION- 229 of Eiiro[)c. Besides this, they have the Old World wanting food, and affected by bad harvests. No wonder, then, that they supply the world with food and agiicultural produce. Only a tenth of their population is concerned in trade. The export of manufactures from the United States in 1880 was 17I millions sterling, whilst our own export of manufactures in the same year was 190 millions. Even in their own highly protected market, our manufactures were then sold to the extent of 240 millions a year ; whilst in our open market theirs were only sold to the extent of 2|- millions. With great facilities for producing iron and steel, and with a considerable native production, prices were so high in 1880 that, in spite of the duty of 40 per cent, imposed on foreign iron, we were able to send them ;^io,ooo,ooo worth, whilst what they sent us was worth £200,000. Their exports were very large in 1880, and increased enormously in the decade ending with that year ; but of what did they consist ? Ninety per cent, were food and raw materials, whilst Nature the manufactures which they try so hard to foster and of ^heir protect did not amount to more than 10 per cent. Their '^^°'^^' shipping, as we shall see below, is not one-fourth — or, if we count one ton of steam as equal to four of sailing, not one-seventh of our own. Of their whole trade they carried 75 per cent, in their own vessels in 1850, and only 16 per cent, in 1880. Food constituted 28^ per cent, of their exports in 1870, and the amount of food which they export increased more than fourfold between 1870 and 1880. The things which they have not protected they provide the world with ; in the things which they protect, and we leave free, they are nowhere in the race. So much stronger is nature than human law — so great are the advantages which Freedom has over Protection. The real moral to be drawai from American trade is the Free Trade moral — viz., that the free development of natural advantages, and the free exchange of natural pro- ducts, are the true sources of commercial prosperity. The respective populations of the United Kingilom ami the I'nitcd States are now about 43 millions and 77 millions, while to her urban 230 FREE TRADE V. FAIR TRADE. population the I'liiled States added between iS8o and igco 13^3 million people, or more than twice the total increase of population in the I'nited Kingdom in the same period. This increase of the city population has naturally been accon^panicd by a great output of manufactures, but there is reason to doubt if the United States is, in spite of its industrial progress, a truly prosperous country at the present time. Free Trade within the States, which for a long while did much to moder.ate the evils of Protection, has since perhaps rather aggravated them than otherwise by providing the vast trusts and monopolies with a field secure from outside competition behind the tariff wall, and yet large and tempting enough to invoke all the energies of capital for its exploitation. Trusts with such power for evil in trade and politics as those of America possess would be impossible in small communities, however high the tariff" sheltering them from competition. The economic waste of Protection is greatest in small countries, but the secondary evils resulting from it, such as political corruption, tyranny in trade, and the breeding of millionaires and paupers, reach their maximum in huge countries like the United States, where immense aggregations of capital are called into being by the alluring prospect of monopolising such a splendid market. There are signs at present that the American trusts have gone too far, and that, in spite of protection from outside competition, the size of the free inter-State market, which was their temptation, will prove their undoing, since, in American language, the monopolists " have bitten off more than they can chew," but in the meantime individual enter- prise is crippled by the trusts, the people are fleeced in high prices, the workers suffer in decreased wages, and America socially and industrially is in a most unhealthy state. The following are interesting scraps of testimony from various sources as to the operation of the trusts in late years, when they were at the very height of their power and insolence : — "That the trusts derived their power from the tariff is not dis- puted," said Mr. Henry O. Ilavemeyer, president of the Sugar Trust, to the Industrial Commission of Congress on June 13th, 1899. " The mother of all trusts is the Customs Tariff Bill. The existing Bill and the preceding one have been the occasion of the formation of all the large trusts, with few exceptions, inasmuch as they provide for an inordinate protection to all the interests of the country, sugar refining excepted. . . . The United States Tariff Bill, in assessing about $40 per ton on imported sugar, pays into the pockets of a few Louisianians, on their crop of 250,000 tons, #10,000,000; to the Hawaiian Islanders, probably represented by 150 foreigners, on their annual crop of 250,000 tons, $io,c03,ooo ; s.iy ico.ooo tons pro- duced elsewhere in the United States, #4, 000,000. Here you have PART II. — RETALIATION. 23I $24,000,000 extracted from the people of the United States for the sake of getting the revenue which ^4 per ton on foreign sugar provides. This is merely illustrative of the whole tariff — every line of it — and its etTect upon the people. In fact, the Tariff Bill clutches the people by the throat, and then the Governors and the Attorneys- General of the several States take action, not against the cause, but against the machinery which the people employ to rifle the public's pockets." The Chicago 7ri/)i(t7e, discussing the formation of the Potters' Trust in January, 1900, wrote: "The trust will raise the price of its products, and common people will either have to buy them or go without, for the American potters are protected by duties which make foreign competition impossible except where the most artistic and highest-priced goods are concerned." And, referring to the failure of all special laws against trusts, the Tribtme further stated : "Congress can hit this latest trade combination a blow on the head by reducing somewhat the high duties on competing foreign goods. That will compel the combine to lower its price or lose trade." Valuable Protectionist testimony comes also from the Melbourne Age, which wrote on February nth, 1901 : "The re-election of Mr. McKinley seems to have given fresh life to trust promoters, as New York mail advices all mention that ' combines ' are again in promi- nence." On October 6th, 1900, the Age, reviewing with approval an article in the American Arena, which pointed out the difference between the harmful American trusts, protected from outside com- petition, and the harmless trusts of Great Britain, expused to the competition of the world, wrote as follows : — " The tendency towards the concentration of capital employed in industry has spread from America to Great Britain. It is, however, in the United States alone that this phase of commercial evolution has assumed the dimensions of a political problem, and has become associated with evils so great that they must be mended or ended. In Great Britain the professed object of such combinations is to improve trade without doing any injury to the consumer, and just as this principle has been kept in mind have their undertakings proved successful. No British trade monopoly, according to the writer, raises the price of such commodity above the level at which the same commodity can be imported from abroad. The formation of trusts, therefore, has no terrors for the English consumer, as it has for the American consumer. As a consequence there is, to the surprise of many Americans, no outcry against great combines in Great Britain." The outcry will arise, loud and fervent, if Protective duties ever render British manufacturers, who are as human as those of America and Germany, the opportunity to crush out local competition, and. 332 FREE TRADE V. FAIR TRADE. free of comiielition from aluoatl, to lleece tlie Ihitish public in llic American fashion. Perhaps, however, the most interesting of all proofs that Protection is the mother of monopoly is to be found in the ingenuous conduct of the first Australian Commonwealth Government, which introduced a highly Protectionist tariff, and at the same time provided that, in the event of it appearing that the manufacture or sale of any article was controlled by a trust, the Ministry of the day should have the right, by an executive Act, to temporarily abolish the Protective duties upon it. That trusts are promoted by tariffs is indeed open to no doubt. Of their blighting effect upon American life there is overwhelming evidence, of which only one or two samples can be given here. On February ist, 1901, the Montreal 6'^ar put the matter ironically, but powerfully, thus : — " The American people still hive their glorious personal freedom. The Constitution guarantees that. They will be absolutely free to do anything they want to do but to buy and sell, to eat and drink, to work for wages, to travel, to light their houses, to go to dramatic or vaudeville entertainments, to wear clothes, and do a few little things of that sort, except upon terms dictated by their sovereign lords the trusts. With this freedom they will still be able to look with pity upon the downtrodden nations of Europe, oppressed by royal tyrants and privileged aristocracies. The serfs, vassals, and villeins of Europe may not be able to appreciate the subtle superiority of the American type of serfdom, vassalage, and villeinage, but it is there all right. The present generation of Euro[)eans have inherited their bonds ; the present generation of Americans can proudly boast that they are self-made people, and have themselves forged the fetters that hold them, and they can boast that they have forged the fetters strong enough and good enough for the purpose." How small business men and their employes suffer was shown by the //,^^, writing on September 6th, 1S99: "The operation of the trusts is beginning to be felt very severely, for more than 25,000 com- mercial travellers are, or are about to be, dismissed from their employment. Where there is no competition there is no need for ' drummers,' as the ambassadors of commerce are called in the United States, and all touting can be done by letter." In April, 1900, the Boston Pos/ wrote : — "We cannot doubt that to-day the cost of production and dis- tribution of a good many articles which are in common use as necessaries of life has been reduced by the industrial combinations known as trusts. A great many industrial plants have been shut down, a great many people, men and women, have been thrown out PART II.— RETALIATION. 233 of cmploymcti', antl in a largo miniLer of industries competition has been crushed out. This mtans an increased profit to the manufacturers, but in no case, so far as reported, has the price to the consumer been reduced. On the contrary, prices have been raised all along the line, and the trust managers laugh at the idea of realising in practice the theory that consolidation and combination are for the benefit of the people who are the consumers." Justice, a Wilmington paper, in October, 1S99, gives a specific case : — " How trusts operate is well illustrated by the recent closing down of the Continental Match Factory at Passiac, New Jersey, U.S.A. Until recently it was the property of Edwin Gould, and was valued at $100,000. In order to cut off its competition the Diamond Match Company bought out the plant for §.1,000,000, closed the factory for good, and turned adrift its 500 employes, 300 of them girls, without warning. The trust w'ill now begin to get that million out of the patient public in increased prices."' The Independent, of P'orest City, Indiana, in February, 1899, gives another example : — " The Indiana Wire Fence Company, of Crawfordsville, has been absorbed by the American Steel and Wire Company, and its buildings now stand deserted. The fence factory was Crawfordsville's chief industry. There were regularly employed 75 men, sometimes more than that number, nearly all of whom have families. The pay-roll for labour alone amounted to nearly $52,000 a year, about every dollar of which was spent in Crawfordsville. The company did not wish to sell out to the trust, but was threatened that the trust would cut prices so low that they would be forced out of business, and the sale was made on January 23rd, 1899. Then the blow fell upon Crawfordsville. The men were thrown out of employment. Most of them had gone into building and loan associations, had borrowed money, and were building themselves homes. They could not meet their payments. Their houses were taken away from them, and they left the city. There was no work for them here. Clerks and sales- men lost their positions, and every branch of business felt this blow." How the crushing out of small concerns, such as the Crawfords- ville wire factory, affected the farmers is shown by the Minneapolis Times, writing in February, 1900 : — " A tariff-fostered trust that touches more people than any other is the steel and wire concern. Every farmer who strings a fence or builds a barn ; every house builder or contractor ; in short, every person who uses wire or nails, must pay tribute to that combine ; and its monopolistic power is conferred on it by high tarilT Protection. " • . . . At the same time it e.xports vast quantities of its 234 I^RI^E TRADE 7'. FAIR TRADE. products, and sells in competition with the world, ils European prices heing about 40 per cent, below home prices. It sells its wire and wire nails cheaper abroad than at home, simply because the tariTon these articles keeps out German and British competition. Thus the American consumers are mulcted in the sum of millions of dollars annually for the benefit of that one trust." Finally, the Philadelphia Ledger, in November, 1900, tells us that :— " It is the heavily protected trusts that are now silencing the wheels of industry by suspending the operation of mills and denying to multitudes of American working men that ' full and unrestricted labour' to which they are entitled." Enough has been quoted to show the unanimity of the conviction that American trusts are a menace and a curse to the traders, the working men, the farmers, and consumers of every other class in America. Neglecting this side of the matter, British Protectionists point to, and grossly exaggerate, the dumping by the trusts in Great Britain, and cry out that we, too, must have Protection in order to prevent Americans from selling goods in our market at less than cost price. It is a priori impossible that such a method of business could continue for any length of time ; it is only possible for a day because the protected Americans permit themselves to be egregiously swindled by the exporting trusts ; and there are abundant signs of revolt by the American people, and a breakdown of the trust system through the sheer unwieldiness of the trusts and the greed of their promoters. Any dangers which they at one time threatened to British industry are steadily lessening, and it would be the height of madness to prevent possible injury to the few in this country through American trusts selling cheap, by the institution of duties which would imme- diately bring into existence Biitish trusts to inllict certain and enormous injury on the many by selling dear. As remarked beforei no individual or corporation can continue to do business at a loss ; in this country for foreign trusts to crush out opponents by tem- porary cheapness and afterwards to exorbitantly raise prices is not possible, because our markets are open to the trailers of the world ; and if people of other countries can honestly make and sell us any article cheaper than we can make it ourselves, it is folly not to buy it of them with the proceeds of goods which it better pays us to make at home. When Lord Farrer wrote, the trusts, which are now such a feature of American and, in a lesser degree, of German production, were in their infancy, but they have been discussed at some length here because of the extraordinary fatuity which at the same time condemns them and sees in their operation a reason for this country PART II.— -RETALIATION. 235 protecting itself. The Protection is supposed to be needed for British industry, yet where can the greatest alarmist point to British industries suffering one tilhe of the injury that is exemplified in the dismissal of 25,000 commercial travellers, the closing of factories and the dismissal of men in the United States? And it must be further remembered that in such isolated instances of injury to some trades in this country as can be ])ut to the debit of the trusts there has been a countervailing advantage to the whole people considered as consumers, and to a considerable portion of them considered as producers, in the obtaining of cheaper goods for consumption or cheaper material of industry. Where the trust attacks a competing business in its own country the whole community has to pay in higher prices for the cost incurred by the trust in ruining or injuring a part. Can a country subjected to such tyranny as that of the American trusts be truly described as prosperous, though the production of wealth within it and the amount of wealth sent out of it increase from year to year ? English labour leaders who have visited the States one and all report that conditions of labour there are inferior to those in England, and whereas Charles Dickens wrote from Boston in January, 1842: "There is no man in this town or in this State of New England who has not a blazing fire and a meat dinner every day of his life. A flaming sword in the air would not attract so much attention as a beggar in the streets," in December, 1894, Mr. John B>n-ns, M. P., told the citizens of New York '"his observations had shown him that the houses in Whitechapel itself— the poorest quarter in London — were clean, wholesome, and luxurious compared with the horrible tenements in which lived the workers of the chief city of the United States." Such advances has the great protected Republic made in the half-century elapsed since its Free Trade days when Dickens wrote. CHAPTER XXXVII. TRADE OF CANADA AND AUSTRALIA. It is, perhaps, even now, too soon to trace the effect of the Trade of Canadian tariff of 1879 on her trade, and it is especially ^nce new difficult to eliminate other causes which have affected it. c.inadian It would have been very strange if Canada had not, tariff i-^rii^. or no tariff, participated in the revival which has taken 236 FREE TRADE 7'. FAIR TRADE. ))lace in the (nulo of the American coiitiiieiit ; it would lie doubly strange if, witli her natural capacity for pro- ducing corn, and with the recent scarcity in Europe, she had not very largely increased her exports. For those exports she must be paid, and wc -should therefore also expect to see her imports increase very largely, and with them her Customs revenue. We do find an increase, but by no means so large a one as we should expect. In 1880, after the new tariff, the amount received as Customs revenue had increased over that received in 1878, the year before the new tariff, by a little more than a million of dollars. The duties in 1880 amounted to about 20 per cent, in value of the whole imports of the country. In 1874 and 1875, before the new tariff, the duties constituted only from II to 13 per cent, of the value of the imports, and in those years the Customs revenue was larger than it was in 1880. Comparing the trade of 1878, the year before the new tariff, with 1880, we find that the imports were 90 millions of dollars in the former year, and 86^ millions in the latter year ; whilst the exports were 79 millions in the former, and 88 millions in the latter. In 1873-74 the imports had been 128 millions, and the exports 89 millions of dollars. In 1883 the imports had risen to 132 millions, but the exports to 98 millions only — little more than they had been ten years before. The increased imports are probably due here, as in Australia, to the investment of foreign capital in railway and other enterprises, whilst the Pro- tectionist tariff has had in Canada, as in the United States, the effect of restricting her foreign markets, and checking the sale of Canadian produce abroad. Considering the increase of population and of cultivated area, and con- sidering also the immense demand of Europe for corn, it is surprising that, even with the check on her industry imposed by the new tariff, the increase of exports should have been so small as it is. Canada has, probably, suc- ceeded in calling into existence some weak manufacturing interests which will prove a thorn in her side, but she has done so at the expense of her natural industries, and has checked the flow of capital and labour from Europe, of which she stands in so much need. We have heard whispers PART II.-- KliTALIATION. 237 in this country of a desire for bargains with England, under which England should either advance money to her, or give some jjreferential treatment to Canada as the price for a reduction of her duties on English goods. Whether such proposals have ever been entertained or made by men of influence in Canada, I do not know. But the chil- ling reception all such notions have met with in this country ought to be a lesson to Canada, and to other Pro- tectionists, that if you want to win the favours of your mistress, it is a very bad plan to put on a fit of sulks in order to make your return to good humour the price for her smiles. The Protectionist i)olicy of Canada is deeply to be regretted by all her well-wishers here, not because it injures the trade of England, for to that trade it is a comparative trifle, but because it tends to cripple the in- dustry of Canada, and to create a bad feeling between the two countries. On pp. 64 and 65 some account is given of the granting by Canada of preferential tariff treatment to the United Kingdom, and the slight effect it has had on trade between the two countries. The general trade of Canada has increased very largely since 1883 in spite of the protective tariff, chiefly owing to the opening up of great wheat-growing territories in the North and West, which have been traversed by railways and, to a great extent, supplied with population by assisted immigrants from the United Kingdom, who are provided with free grants of land. There has also been a very large immigra- tion from the United States, and the population of British North America, which was 4*3 millions in 1881, reached 5 millions in 1891, and in 1901 5*6 millions. In 1890 exports were valued at 21 'i millions, in 1900 at 4r2 millions, and in 1901 at 42-1 millions. For the same years the imports were 24^5 millions, 387 millions, and 38"8 millions. The case of Victoria and New South Wales is ])articu- Compari. larly interesting, because the two Colonies are in many ^""^°/j r respects similarly situated; and whilst the one (Victoria) ivade. &c, has embraced Protection, the other (New South Wales) has '" Victoria remained steadfast to Free Trade. Both have })rogressed, somh'^* but New South Wales has made by far the greater pro- \\aies. gress of the two. It appears, on conipariu'^ the progress of the two 238 FREE TRADE V. FAIR TRADE. Aubnaiian Coloiiies for the decade ending with 1880, that the following Vktoria ^^^ ^^^ general results : — and New South Victoria. New South Wales. Population increased from 726,000 increased from 502,000 to 860, coo, or 18 to 770,000, or 53 per per cent. cent. Excess of Immigrants stationary . increased from 4,000 to over Emigrants 19,000. The Value of Rateable increased by less than more than doubled. Property one -half Customs Revenue stationary , , increased by nearly one- half; and is, with a less population and low tariff, nearly as great as that of Victoria, with a large population and high tariff. Imports . . increased from lai increased from 7J mil- millions to 14^ mil- lions to 14 millions. lions, or 17 per cent. or 80 per cent. Exports . . increased from 12^ increased from S millions millions to 16 mil- to 15 J millions, or 94 lions, or 28 per cent. per cent. Since 1880 things have pursued a similar course. I annex a table (No. XXV., in the Appendix) giving the population, public debt, and imports and exports of each of the Australian Colonies from 1873 to 1883, extracted from the Victoria Year Book, from which it will be seen that New South Wales, the Free Trade Colony, has in- creased its imports from 14 millions in 1880 to 21 millions in 1883, and its exports from 15 J millions in 1880 to 20 millions in 1883 ; whilst Protectionist Victoria has only increased its imports from 14^ millions to 17^ millions, and its exports from 16 millions to 163 millions in the same time. This table also shows that New South Wales has increased its exports in these three years far more than any of the other Australian Colonies, all of which are far more Pro- tectionist. It is exports which our Fair Traders are par- ticularly anxious about, and it must be some disappoint- ment to them to find that among a number of British societies starting on similar and equal terms, the one I'AKT II. — RETALIATION. 239 which has constantly admitted free imports has actually increased its exports far more than those which have en- deavoured to promote their production and their power of export by Protective duties, thus giving an excellent illus- tration of the Free Trade maxim, " Leave the imports free, and the exports will take care of themselves." From a fiscal point of view it is greatly to be regretted that Australian federation and a common tariff have put an end to the interesting object lesson in the comparative effects of Free Trade and Protection which were afforded by the two States of Victoria and New South Wales. In no other part of the world were two communities to be found peopled by the same race and so nearly alike in the character and extent of the resources under their control, and in their government and laws, which were, in fact, practically identical, except in their methods of taxation and the adherence of one State to Free Trade while the other v/as devoted to Protection. It is true that New South Wales has much the larger territory, but most of the population is concentrated in the eastern division, with an area of 94,000 square miles against Victoria's 87,000, while in New South Wales 220,000 people are scattered over an area of 224,000 square miles, which is subject to the most disastrous droughts, and requires in administration and the providing of roads, railways, and postal services a much greater expenditure than is derived from it in revenue. Thus, from an economic point of view, New South Wales has probably derived no advantage, but has rather suffered disadvantage in her larger area as compared with the smaller, more compact, and more fertile State of Victoria. In mineral resources New South Wales has the advantage in possessing far richer coalfields than Victoria, but \'ictoria has produced, and continues lo produce, immensely greater cjuantities of gold. Up to 1880 ip population and many other respects Victoria maintained the lead of New South Wales wliich the great gold discoveries and the subsequent settlement of her lands had given her. In 1 871 Protection, which had begun with small 10 pdr cent, duties in 1865, was increased, and from 1S71 Victorian Pro- tectionists date the efficient application of their policy, which cul- minated in 1895 i" duties averaging over 40 per cent. New South Wales, on the other hand, was practically a Free Trade country until 1892, when small Protective duties were introduced, and swept away again lo give place to an even lighter tariff than that they had displaced. Bearing these facts in mind, it is instructive to note that in 1901 New Sc)uth Whales was more populous than \'ictoria. It had greater imports, greater ex\)orls, enii)loyed more men in its 240 FREE TRADE V. FAIR TRADE. factories, had a greater amount of capital invested in them, and paid higher wages to its employes ; its savings banks deposits were greater per head of population, its consumption ol food was greater per head, it was gaining population while Victoria was losing it, its postal receipts were greater though it carried newspapers free, which Vic- toria did not, and its income per head of population was much greater than that of Victoria. Many of these facts are illustrated by the following tables, the data for which are taken from Australian official publications :— PorULATION Victoria. New Soutfi Wales. 1871 732,000 504,000 1901 1,209,000 1,380,000 Excess for Victoria 228,000 Excess for N.S.W. 171,000 Since 1901 the population of New South Wales has increased, while that of Victoria has declined. Excess of Immigration or of Emigration bf,tvveen 187I AND 1901. New South M'ales .. .. 283,000 .. .. Gain of Population Victoria .. .. .. '3.154 •• •• Loss of Population CoMi'ARAi ivE Statistics. Income per Head Savings Banks Deposits per Head ... Meat Consumed per Head Tea per Head Suaar Grain Spirits Consumption of Tobacco per Head .. Imports Exports Total Hands Employed in Factories Males Females ... ... ... '... (Jutput of I''actories Wages paid in Factories H. P. Employed Value of Plant Postal Revenue . £42'? £Z 75. iid. 209 '3 lbs. 6-9 lbs. 93 lbs. 326*4 lbs. •78 gal. 2' 13 lbs. ;{|l8,927,000 ;il8, 646,003 66,529 47.059 19.470 Ai8, 512,003 ^^4,589.000 34.548 ;^4,847,ooo ^620,000 New South Wales. £47' 3 jCS IIS. 2d. 297.3 lbs. 7-7'lbs. 107-8 lbs. 374 lbs. •82 gal. 2*67 lbs. ;{|26,928,COD ;C27,35t.coo 66,135 54.461 11.674 X;24,393,ooo £4,943,°oo 40,823 £s.m,oQo 6870,003 241 CHAPTER XXXVIII. AGRICULTURAL DEPRESSION ; EFFECT OF BAD HARVESTS. But there has been a long and continuous depression of agriculture, the largest of all our productive industries ; and this, it may be said, brings with it depression of all. Now, that the farmers have suffered severely during the last eight or ten years there can be no doubt. The amount of their losses it is not easy to estimate ; but competent obseivers calculated in 1880 that, if their then condition, arising from the losses of the previous six years, were com- pared with their condition ten years before, they must have been the worse by a sum approaching 200 millions, or, taking it by the year. 30 millions a year. As is well known, their condition has not improved since then. The comparatively good harvests of 1884 and 1885 failed to relieve them ; and there is reason to believe that land- lords have recently had to make great reductions in the rent of arable land. The most recent and most trustworthy estimate of agricultural losses is that made by Sir J. Caird in his evidence given to the Depression of Trade Com- mission.* He compares the position of landlords, tenants, and labourers in 1876 and in 1886, and he calculates that of'^*^ the total annual income of the three classes in 1886 is less in^g^g^st by ;£42, 800,000 than it was in 1876 ; and that of this loss the landlords' share is ;^20, 000,000, the tenants' share £20,000,000, and the labourers' share £2,800,000. The diminution, he thinks, has been gi'adual ; and he appears to think that, comparing things now with what they were twenty years ago, landlords have lost in the last ten years of the decade all the rise of rent which took place in the first ten years, and that labourers' wages, whilst less than they were ten years ago, have not yet fallen to the level of 1857. Agricultural wages have since 1881 risen to and remained at higher point than they ever previously attained. * C. 4,715, Qu. 7,673, and f. 7,677, 7,742, and 7,785. Q Sir J. Caird's estimate of the losses] ?42 FREE TRADE 7'. FAIR TRADE. Losses of Farmers due to four causes : 1, Rise of Rents ; 2, Rise of Wages ; 3, Lowered Prices ; 4, Deficient Produc- tion. First three a loss to the Landed Interest, not to the whole Com- munity. Sir J, Caird also jioints out that, whilst one groat factor in this loss has been the fall in prices of agricultural pro- duce, an equal fall has taken place in the prices of other articles ; so that a part, at any rate, of this money loss above mentioned is shared b}^ other classes, and is rather nominal than real. Whatever be the sum thus lost by the agricultural class, it is due to several factors, of which bad harvests form only one. A rise in rents — which had been going on long before the beginning of the decade, and which continued until 1872-73* — an increase in the cost of labour, and a heavy fall in the price of agricultural pro- duce, owing to foreign competition, are other factors. Of these four factors, the rise of rents, and the rise in the cost of labour — a most uncertain item — were estimated in 1880 to account for something less than one-third of the whole loss, leaving more than two-thirds of the whole loss to the two factors of bad harvests and lowered prices. In what proportion it should be divided between these two factors is matter of controversy. Some persons would attribute the larger proportion to the bad harvests ; others think that this has had a much smaller effect than lowered prices ; but that both factors have had a great effect in causing loss to the farmers, all agree. Upon the questions of what is the total amount of loss and in what proportions it is to be attributed to each of these factors, I will not enter ; the important point for our present purpose is that it is only a portion of the farmer's loss due to bad harvests, which is a pure economical loss to the country. The rise of rent goes into the landlord's pocket ; the rise of wages to the labourer ; and if the farmer loses by the substitution of cheaper food from abroad, the consumers of that food gain in lowered prices. The present agricultural de})ression has, consequently, been confined, to a great extent, to the farming and land- owning classes. Farmers have suffered much, rents have been remitted or lowered, but the population generally has been little affected, and trade revived for a while during the worst times of agriculture. For the first time since the repeal of the Corn Laws, foreign com]')etition, in supply- ing food to our people, has been unaccompanied by such * Sir J. Caird says the rise wont on until 1877. See C. 4,715, Qu, 7,677. PART II. — RETALIATION. 243 a rise in demand as to compensate, and more than com- pensate, the Enghsh agriculturist. Even now it is doubtful whether the recent fall in prices will have as great an effect in lowering the letting value of land as the increased demand for food, consequent on Free Trade, has had in raising it in former years. So far, therefore, as lower prices ai-e concerned, the What is the nation is not a loser. The loss of the farmer and land- od^cient owner is the gain of the rest of the people. But it is worth Harvest while to consider what, under a system of Free Trade, is °" ^"'""^ the effect on the welfare of the entire community of so munity? much of the farmer's loss as is really due to a bad harvest. That it is a loss to the agricultural interests, and conse- quently to the community, which includes those interests, there is no doubt ; but to what extent does it affect the large majority of the population, who are neither farmers nor landowners ? The loss which they suffer has, I be- lieve, been both exaggerated and understated. In one of our anti-Free Trade journals I find the following passage : — "Mr. Bright explains the depression of trade by the loss of millions through the insufficiency of harvests, and the inability of all persons interested in agriculture to make their accustomed purchases. " But the Free Traders denied this. They said that foreign corn would pour in, and must be paid for, and would bring about a profitable exportation of non-agricul- tural products." Whether the Free Traders said this or not, I do not know. But the real state of the case seems to be as follows : — Suppose that there is a deficiency of 10 million quarters — worth, say, 20 million pounds. The agricultural in- terest will lose this sum, and will be actually so much the l)oorer. They will be unable to exchange their com for non-agricultural i^roducts, and, so far, trade will be in- jured. The argument above referred to as the argument of the Free Traders assumes that the same quantity of corn must be ])urchased abroad at the same price as would have been paid for the corn produced at home, and that the same quantity of non-agricultural produce must be exported to pay for it ; and that, if so, manufacture and 244 FREE TRADE V. FAIR TRADE. trade will not suffer on the whole. But the above as- sumption is not strictly accurate, as the following con- siderations will show : — 1. Supposing the conditions of production abroad to remain the same, the corn brought from abroad will necessarily cost rather more than the home-gi^own corn would have cost, and the goods sent to pay for it will have to pa}^ freight and expenses. This loss will fall on the whole community. If, indeed, as has been recently the case with ourselves, the importers of corn are also the earners, the freight will return into the pocket of the nation. 2. The course of trade will be deranged, and this will be a loss to the manufacturer as well as to the agriculturist. 3. The foreign purchaser will not want so much of the same things as the home purchaser, and will probably have to be tempted by a lower price. He may want some things very much, as the United States wanted iron for railways in 1880. In that case, the price of iron would go up in England, but the price of other manufactures would go down. 4. The demand for corn will be large and immediate. Bills of America on England will be at a discount. Bills of England on America will be at a premium. The former will be in excess. There will be an immediate profit to America on the business, till the balance is redressed by the exports to America. Consequently, in their different ways, the trading and manufacturing interests of England, as well as the agricul- tural interest, must suffer from our bad harvests ; but their suffering is comparatively small ; and under present cir- cumstances is largely compensated, if not more than com- pensated, by the low prices of foreign food. What their suffering would be if foreign food were excluded, or raised in price by high duties, it is, in the present state of our jiopulation and of their employment, frightful to con- template. 245 . CHAPTER XXXIX. COMMERCIAL DEPRESSION SUBSEQUENT TO 1873. We have already seen, in Chapter XXVIII., what an impetus our trade received in the period between 1840 and i860. We know also how much the trade of France, as well as of England, grew after the treaty of i860 ; and we may fairly ask our opponents, who are calling for a reversal of the policy which produced those benefits, to show not only that we have since that time been deprived of them, l^ut that we should not have suffered that loss if^we had not been Free Traders. We have a right to call upon them to define the specific evil of which they complain, and then to prove that it is due to Free Trade. I need not say that no such definition, no such proof, is forth- coming, and we are left with nothing but a vague shadow to fight with. Let us, however, take such facts as we can lay hold of, and see how far they bear out the notion that we are losing our markets in the world. Let us admit that our exports, as measured in nominal values, considerably diminished since those roaring years of prosperity, 1872 and 1873. They were 256 and 255 millions in those years, and 191 and 223 millions in 1879 and 1880. In 1882 they were 241 millions, and in 1884 233 milhons, further decreasing to 213 millions in 1885. Let us admit, too, that this decrease of exports has been the sign and result of a real depression, and that both profits and wages have decreased since those so-called prosperous years. This in itself has nothing to do with the question at issue, unless it can be shown to arise from a permanent loss of market for our manufactures. Nothing whatever of the kind has been shown, or can be shown. But it can be shown that the prosperity of the earlier years of the decade is exaggerated ; that the depression is exaggerated also ; and that there are ample causes to account both for one and the other without assuming any Burden of Proof lies on those who call for change of our Policy. Commer- cial De- pression subsequent to 1873. 246 FKEE TKADE V. FAIR TRADE. Exaggera- tion of Prosperity of 1872-73. falling off in the general demand for, or su])ply of, English goods. ■ The prosperity of 1872 and 1873 has been immensely exaggerated. All persons engaged in producing coal and iron made, no doubt, enormous profits, but they were led by those profits into an extravagant exi)enditure, partly on personal expenses and luxuries, but still more on plant and machinery for increasing the output, which has flooded the market with excessive supply, and from which no adequate return has yet been received. This ex- penditure of capital in fixed and, at first, unremunerative investments, is one cause of subsequent depression. But whilst coal and iron masters made fortunes in those years, manufacturers and others who had to use coal and iron had to bear heavy outgoings, and their i)rofits were reduced accordingl}'. Prices being high all round, people with fixed incomes suffered accordingly. Even the high wages of the time went less far than lower wages do when prices are lower. A great deal of the prosperity was apparent rather than real. The statistics made the exports appear larger than they really were, because prices were so high. The quantities of goods exported, and the labour necessary to produce them, were as large in the subsequent years of depression as they had been in the years of inflation, but appear to be less because prices are so much lower. The exports of British produce were 255 millions in 1873, and 223 millions in 1880. If the exports of 18S0 were valued at the prices of 1873 they would be 311 millions, or larger than those of any previous year. Imported raw material — e.g. cotton and wool — was much dearer in the period of inflation than in the subse- quent period of depression, and consequently that portion of the exports which is due to British labour and capital differed in the two periods much less than aj^pears at first sight by the figures of the total exjiorts. Eor instance, the raw cotton imported in 1873 was about the same in quantity as the raw cotton imported in 1879. But the raw cotton used in our manufactures ex})ortcd cost us 14 millions more in 1873 than the same quantity cost us in 1879. PART II. — RETALIATION. 247 The prices and exports ot the inflated years were dne to causes which were temporary and accidental, and brought with them a necessary reaction. Amongst other causes may be mentioned — Expenditure of capital in this country on plant and machinery, not even yet fully reproductive. Investments of English capital abroad, some of which were wholly unproductive — e.g. the bad foreign loans ; and some of which were not immediately productive — e.g. American railways, but which are now in various ways bringing us a large return of imi)orts. Advances made to assist France in paying the German indemnity, which caused a large export from France and England to Germany at the time, and large exports from France to England and to Germany at a later time. I have given the figures which illustrate this process in the Tables VIII., IX., and X. in the Appendix. All these causes have little to do with the permanent demand for goods ; all of them largely increased our exports at the time ; some of them proved in the end losses, whilst others have helped that increase in our sub- sequent imports which Fair Traders seem to dread even more than losses. The inflation, as well as the depression, is therefore fully accounted for without any reference to closed markets or decrease in permanent demand. It is a complete mistake to suppose that extraordinarily large exports, very high prices, and a great demand for labour are necessarily signs of great and permanent pros- perity ; they are only signs of great activity. They may l)e caused by a continuous demand, and by good and repro- ductive investments of capital, in which case they are elements of permanent prosperity. But they may be caused by bad investments, by payment of debt, or by unproductive exi:)enditure on war, or by other causes which may lead to absolute loss. If I employ a thousand men to dig a hole and fill it up again, I shall cause high wages, high prices, and great prosperity in my neighbourhood for a time ; but my cajiital will be lost, and when the work is at an end there will be a sad reaction and relapse. Thsse are very elementary truths, but they seem to be forgotten by many popular expounders of statistics. Temporary Causes of Inflation. Depression since 1873. Large Ex- ports and High Prices not neces- sarily Tests of Pros- perity. 248 FREE TRADE V. FAIR TRADE. Appieci;i- In addition, there is another cause lor a chronic and Gold°'^ permanent diminution in the vahies of both exports and imjwrts, to which I can only advert very shortly. Good statisticians arc of opinion that the value of gold, as com- pared with commodities, is steadily on the rise, and that it has been so since the effect of the gold discoveries was exhausted. The question is too long and difficult to be discussed here. But if the statisticians are right, as they probably are, the rise in the value of gold will account not only for some diminution in the figures of value by which we estimate our trade, but for a general fall of prices, and also of wages, which are too frequently and hastily attributed to commercial depression and to a decline in the producing and consuming powers of mankind. Depression The effect of the appreciation of gold must be slow and since 1873. gradual, and is often concealed by the greater immediate tion of ' effect of fluctuations due to other causes. But its result Gold. in producing a feeling of depression is probably out of proportion to its real effect. Upon the real wealth of the country as a whole it has not necessarily any effect at all. If, as Hume has said, every one had to-morrow half as many sovereigns in his pocket as he has to-day, he would be neither richer nor poorer. He would buy or sell for half-a-sovereign what he has to buy or sell for a sovereign to-da}^ But a time of falling prices is notoriously a period of depression. It is a bad time for the larger merchants who carry on the great trades of the country. When they have to borrow money to complete their pur- chases, and it rises in value before they have to repay it, whilst the commodities which they buy fall in money value at the same time, they suffer actual loss ; and this loss probably operates on their ex])cctations and makes them less daring in business. Other classes gain what the merchant loses. The retail dealer, who can generally jwst- l)one a proportionate reduction of his retail j^rices, and the consumer who ultimately gets the benefit of the fall in price, share the gain between them. But it is the whole- sale trader who carries on the large speculative business of the country, and who is listened to as its representative, and he is out of pocket and out of lieart at a time of falling prices PART II. — RETALIATION. 249 Since my second edition was published, the subject of the precious metals has assumed greater importance. The opinion that gold has risen in value, and that prices, and even wages, are much affected by the rise, continues to gain ground, and remedies of different kinds are proposed. It is out of the question here to approach the question of the currency, which is only remotely connected with the more immediate subject of this book ; but it may not be impertinent to urge that, although it is quite true that a greater or smaller quantity of coins does not add to or take from the wealth of a country, yet an increase of the precious metals and a consequent rise of prices causes a rise in spirits, a sanguine feeling, and a tendency to specu- lation, which results in an actual increase of business ; whilst a diminution in the precious metals causes a lowering of spirits, a feeling of depression, and an indisposition to speculate, which results in an actual decrease of business. If this is the fact, it would be well worth while that the much-disputed facts concerning the present relations of gold and silver to each other and to commodities should be made the subject of a special authoritative inquiry. If such an inquiry should not result in suggesting any effectual remedy, it would still be useful in clearing men's minds as to the facts, and in removing such impediments to a resumption of business as arise from vain imaginations. So far as depression is a " mental attitude," such an in- quiry might operate as a cordial and a cure. There is another cause for chronic depression — or, change in rather, for a feeling of chronic depression — to which it is ^'".de of worth while to advert. We are told that a great change Busin^ess. is taking place in the mode in which foreign trade is con- ducted. Before the times of steam and telegraph there was a long interval of time and space between the com- mencement and the end of a transaction, between the original purchase and the final sale. This afforded great scope for the merchant or middleman ; and his profits depended ui)on the judgment and skill with which he could forecast distant and future markets. At the present time the state of markets is known everywhere at once by telegraph, and the period of transport is abridged by steam. Stocks in hand need no longer be as large as formerly. The 250 FREE TRADE V. EAIR TRADE. original vendor and final purchaser are brought nearer to- gether, and the opportunities for the skill and judgment of the middleman are curtailed. The world gains on the whole by the change, but the old-fashioned merchants, who have done so much to make England what she is, suffer or are extinguished, and from that powerful and important class we haVc the natural cry that trade is bad, although at the same time the bulk of transactions is greater than ever. Both these causes — viz. an appreciation of gold and a change in the methods of trade— affect the same class, a class which is naturally influential in specially expressing its feelings of depression. That such a class should suffer is to be lamented. But the losses of this class are the gains of other classes, and it would be wrong to suppose that they constitute any real diminution in the wealth or prosperity of the country as a whole. CHAPTER XL. DEPRESSION AT THE PRESENT MOMENT AT HOME. Since 1880 SiNCE the two preceding chapters were first written in there has 1880, there has been a short revival of trade in this country, followed by a depression, which still exists. The following chapters remain almost as written last year for the second edition, although, especially after the investigations of the Royal Commission, they are very inadequate. But the Commission has not yet reported finally, and to treat the subject adequately would require more time and space than can be given here. There is the less reason for at- tempting the task, because the investigations which have taken place show conclusively that the present depression is universal among trading nations, and that it affords no ground whatever for throwing any doubt on the sound- ness of our own commercial policy. The following are facts and figures which illustrate the extent and nature of the present depression in this country : — PART II.- RETALIATION. 25 1 I. — Agricultural Depression has continued. Causes of Bad seasons for the farmer continued until 1884 ; and aj^Pfesent" the fair average crops of that and last year brought him moment, little benefit in consequence of the low prices caused by '■ Agncui- the glut of foreign corn. Agricultural wages continued to rise until recently ; and though they are now falling, they are high as compared with former years. Rents have been largely reduced. The conversion of arable land into pas- ture has continued without intermission for a number of years. The number of sheep was still in 1885 i-J- millions less than in 1879. The demand for agricultural labour must have diminished. The injury to land done by a succession of bad seasons and by want of due cultivation is cumulative. It costs a great deal to bring into order a farm which has for years been neglected. In all these ways the agricultural classes have suffered and continue to suffer. The loss of crops by bad seasons, by diminution in stock, and by deterioration of land, is an economical loss to the country generally ; and so also is the loss of employment when the labourer is not, from want of versatility or for other reasons, able to find other emploj'ment. The rise and fall of rent or wages, and the low price of foreign corn, are not, as pointed out in Chapter XXXVIII., an economical loss to the country generally, but they cause suffering and inconvenience to particular classes, whilst benefiting others, and thus aggravate the general feeling of distress. What is the pecuniary amount of loss sustained by the agricultural classes, and how much of it is an absolute loss to the nation, it is impossible to estimate with certainty, but it is, no doubt, a real and efficient cause of tem})orary depression. Of one thing we may be sure, viz. that if we should again have good seasons, and if the land should again bring forth its full and fair produce, the other causes of agricultural distress, whatever their social or political effect, will not, under the Free Trade regime, be an economical loss to the country. It must also be remembered that agricultural depression does not apply to tlie whole of the United Kingdom, but to the corn districts exclusively, or, at any rate, specially. The grazing districts have not suffered, or, at any rate, not in like proportion. 252 FREE TRADE V. FAIR TRADE. Causes of depression at present moment. I. Agricul- tural. Care must also be taken not to confound agricultural distress with distress of the landed interest, A great and increasing part of the land of England is used for mining, manufacturing, and residential purposes. Its value in- creases with the growing wealth of the country, and is not affected by the failure of harvests. The losses of the landed classes, and the silence and dignity with which they have been borne, should not prevent us from remembering what are the limitations of those losses. 2. Boom and subse- quent col- lapse in shipping. 3. Boom and col- lapse in United States railways. 4. Con- sequent revival and subsequent depression in iron trade. 2. — Depression in Shipping. A second cause of depression is to be found in the " boom " in shipping which culminated in 1883 and col- lapsed in 1884. I have elsewhere (in Chapter XLVI.) referred to the particulars of the collapse. At a period when the interest of money was falling, and when investors had a difficulty in placing their funds, came an unprece- dented demand for freights for corn, iron, and other com- modities. Investors rushed madly into shipping, and the result has been a collapse of the trade here and throughout the world, accompanied by the most serious catalogue of losses by shipwreck we have ever experienced, which, though falling primarily on insurers, are nevertheless borne in the end by the nation. 3. — American Railways. In the third place, there has been a similar " boom " in American railways, as I have shown below, and a similar collapse. 4. — Boom and Collapse in Iron. In the fourth place, these two " booms " in EngUsh shi})ping and in American railways have told upon the great iron and steel industry of this country. An ex- ceptional and excessive demand has been followed by an excessive supply, a cessation of demand, and a glut, which still continues. The following is from the Economist of loth of January, 1885 : — " Looking back at the history of the iron trade during the past few years, it is abundantly evident that the present PART II. — RETALIATION. 253 troubles are traceable to the ' spurt ' of 1879 '^"^ 1880. Causes of The evils begotten of the ' boom ' of 1872-4 were, in one depression respect, less than those following in 1879-80. In the momem? former period, there was scarcely any increase in the pro- 4- iron, duction of the world, whilst in 1880 and succeeding years the increase was quite remarkable, as the following figures will show : — Production of Pig-iron throughout the World in thousands of tons. 1883. 1882. 1881. 1880 20,239 ... 20,075 ■•• 18,966 ... 17,485 '879. 1877. 1874. ,872. ^3.700 ••• 13.430 ... 13.057 ... 13,906 The great inflation in prices which took place during the years 1871-5, coupled as it was with a con"esponding rise in wages, led to some relaxation in the energy of the British workman, and so the evil of over-production was restrained. It took till 1879 to bring prices back to something like their normal condition, and had it not been for the break- ing out of the American demand at the close of that year, we would have likely witnessed that ' natural ' revival which seems to follow in recurring cycles. Instead of this, everything was thrown out of the natural order, and we are now passing through the period of reaction necessary to put matters right again. The development caused by the spurt of 1879-80 may be the better imderstood from the following figures, showing the extension of trade in rails, shipbuilding, etc. : — Production of Rails in the United Kingdom. 1883. 1882. 1881. 1880. ,879. Tons. 'Ions. Tons. Tons. Tons I.037.J94 ■•• 1.235.785 ■•• 1,023,740 ... 739,910 ... 519,718 Total Tonnage of Ships built in the United Kingdom. _i88(. 1882. 1881. 1880. ,879. Tons. Tons. Tons. Tons. Tons 1,329,604 ... 1,240,824 ... 1,013.208 ... 796.221 ... 569,462 We estimate the total production of 1884 ^^ 7,600.000 tons, against 6,009,434 tons in 1879. The fact here re- vealed explains one of the causes of the present depression. " Large though the volume of trade was in 1884, it was 254 FREE TRADE V. FAIR TRADE. Causes of depression at present moment. 4. Iron. very considerably under that of iornier years. The exports of iron and steel were over 500,000 tons less than in 1883, and 800,000 tons less than in 1882. At home the greatest depression was experienced in connection with shipbuilding and engineering. It is estimated that the tonnage launched was at least 500,000 tons less than in 1883. This would represent at least 300,000 or 350,000 tons less iron and steel consumed. These figures, taken in connection with some depression in other branches, would represent a re- duction of at least 900,000 tons in the trade of 1884, when compared with the year preceding." It is probable that the substitution of steel for iron is one cause of the boom, and of the subsequent reaction. The demand for the new article, steel, gave a great stimulus to the manufacture. That demand has been suppliea, and the new article is much more durable than the old. Hence a falling off in the demand. 5. — Glut of Corn. Fifthly, there has been a glut of corn. Not that more corn has been produced than is needed, but more corn than could be paid for at prices sufficient to remunerate the growers, who have suffered, and are suffering, accord- ingly. 6. — Wars and Tariffs. Sixthly and lastly, human stupidity and human passions have had something to answer for — partly in wars and ru- mours of war ; partly in the Protectionist remedies which many countries are adopting — remedies which can only aggravate the disease. The evil to be cured is, not that there is more of anything in the world, especially of food, than \)Q.o- ple want, but that it is in the wrong ])lace or in the wi'ong hands. One would have thought that, so far as men are able to cure this evil by law, they would try to do so by removing all legal impediments which prevent a transfer to the right place or to the right hands of things which are in the wrong place or in the wrong hands. But instead of this, many nations are multijilying these impediments, and our Fair Trade friends would fain have us follow their mad examples. PART II. — RETALIATION. 255 The following statistics for the last six years show that the depression in this country has not hitherto been of an extreme kind : — 1879 1880 1881 1882 1883 1884 t885 In cons Value of Ivtports and Exports. Total net Imports in millions of pounds. 306 348 334 348 361 327 313 Extent 01 depression. Statistics — 1879 to 1884. Trade. Total Exports of British produce ia millions of pounds. 192 223 234 241 240 233 213 idering these figures it must be remembered that they denote value, not quantity ; that prices have fallen ; and that, though money values may be less, the amount of useful commodities may be as gi"eat as before. Hes and Ch aranccs at Ports in th e Un ited . Kingdom in millions of tons. Entriesand 1879 rotal. 53 Sailing. 20 Steam. 33 clearances of shipping. 1880 59 22 37 1881 58 19 39 1882 61 18 43 1883 65 17 48 1884 64 14 x * ' 49^ 1885 64 14 i 49? Receipts from Raihv ly Traffic in VI illions of pounds. Railways. Goods. Passengers. Total 3rd Class Passengers only 1879 ;^33 26 59 14 1880 36 27 63 15 1881 37 28 65 15 1882 38 29 67 16 1883 39 29 68 17 1884 38 30 68 18 1885 37 30 67 18 Coal and In nt f) ■odtifcd in thou sands of tons. Coal and Coal. Pig Iron. iron. 1879 133,80s S.99S 1880 146,819 7,749 1881 154,184 8,144 1882 156,500 8,SS7 1883 163,737 8,529 1884 160,758 7,812 1885 159. 35' 7,415 256 FREE TRADE V. FAIR TRADE. Extent ot depression Cotton. at piesent moment. Raw Cotton used in Yards of Ijiece goods exported millions of pounds. in millions of yards. Cotton. 1879 .. 173 3.725 1880 373 4,496 1881 439 4.777 1882 461 4,349 'fj> S'o 4,539 1884 466 4.417 18S5 343 4.374 Wool. Raw Wool used in viillions of pounds. 1879 , , 321 1883 .. 340 1880 .. 370 1884 .. 381 1881 320 1885 .. 36s 1882 •• 357 Consump- Consumption per hea d of certain articles. tion of sugar, tea, &c. Sugar.* Tea. ::offee Tob.TCCo. Spirits. lbs. lbs. lbs. lbs. gallons. 1879 .. 65-95 ■• 4-68 I -GO 1-40 .. I -I I 1880 . . 63-40 . . 4-57 092 1-42 .. 109 1881 .. 67-33 •• 4-58 0-89 1-41 .. 108 1882 .. 70-46 . 4-67 0-88 I "42 .. 1-07 1883 .. 71-74 • 4-80 089 1-42 .. 1-06 1884 . . 72-18 . 4-87 090 .. 1-44 .. 1-03 1885 . . 74-28 . 5-02 0-90 .. 1-45 .. 0-97 ' Sugar is used in manufacture of jams, biscuits, &c., as well as in direct consumption. Pauperism. Average number of Paupers in receipt of relief in Eni^land and Wales in each year, ending Lady Day. Numbers per 1000 of Average Numbers. population. 1879 765.455 30 1880 808,030 32 1881 790,937 31 1882 788,289 30 1883 782,422 30 1884 765,914 29 1885 768,938 28 It appears, further, from the monthly returns of pauperism which have been issued, that the average number of indoor and outdoor ]:)aupcrs reheved during the calendar years 1884 and 1885 were as follows : — 1884 700,745 -) Exclusive of about 52,000 pauper 706,858) lunatics and 5,000 vagrants. PART II.— RETALIATION. 257 During the first three months of 1886 the corresponding Extent of figure was 773,656, the average for the same period of '^ep'-es^ion 1885 having been 736,406. Deposits in Savings Banks in millions of pounds. 1879 18S0 1881 1882 18S3 1884 1885 Tost Office Banks. Trustees. To-al 32 44 • 76 34 44 • 78 36 44 80 39 45 . 84 42 45 . 87 45 . .46 91 4S . 46 94 The Savings Banks also held the following amounts of Government stock for depositors : — 1883 18S4 li \ at present moment. Savings Banks. The statistics of bankruptcy and of emigration I do not give here, as I have referred to them in Chapter XLII, I have said elsewhere that the causes of depression are so many and so various that it would be erroneous in the extreme to draw absolute conclusions from particular instances without a full knowledge of all the conditions. To attribute the prosperity of this country to Free Trade alone is a fallacy, which enables its opponents to turn the tables on us when that prosperity suffers a check. But if we can show that other countries — and especially countries which have adopted Protection — are suffering from the present depression as much as or more than we do, we may fairly conclude that our present evils are not due to Free Trade, and would not be removed by Protection. If we can further trace in some of these cases a connection be- tween Protection and the evils from which Protectionist countries are suffering, we shall raise a further presumption in favour of a Free Trad'* policy. The reports made by our Ministers and Consuls abroad enable us to say, in the first place, that commercial de- pression — understood in the sense in which we use it in this country, viz. as a shrinkage of values, of prices, and of profits, not of volumes — is universal throughout the in- K Depression in other countries. 25S FREE TRADE V. FAIR TRADE. dustrial world. Over-production, glut, and a reduction of prices and profits are complaints echoed and re-echoed from every countr}^ on both sides the Atlantic. To give the particulars for all countries would be inii)ossible, but it is worth while to consider carefully the case of two or three of them. Of the present depression in Germany I have given a short account in Chapter XXXV., which deals with the interesting subject of the development of German manu- facture. France, which has started on the course of Pro- tection, the United States and Russia, which have almost reached the goal, and Belgium, which still adheres to the Free Trade poHcy, each deserve separate chapters. CHAPTER XLI. PRESENT COMMERCIAL DEPRESSION IN FRANCE. Depression There can be no doubt that the depression in France has Fran'ce '" been, and is, very great ; greater, probably, than the than in depression in England. Taking the quinquennial period England, ending with 1884, our imports, reckoned in value, have diminished by Vu^h, those of France by 1th ; our exports have increased, whilst hers have diminished. The reports from all parts of France are to the same effect.* From Paris, from Lyons, from Marseilles, from Rouen, from Lille, from Havre, from Nantes, from the colliery districts, from the iron districts, from the shipping ports, whose shipbuilding has not been revived by bounties ; from the wine districts, from the beet and sugar districts, from the corn districts, the tale is the same : over-})roduction. low prices, low jwofits, and even in some j)laces largely dimin- ished production, and numl)rrs of men out of work. The following are a few ol tlu' sj)e(ilic facts. The Paris business * See Reports from Mr. J. A. Crowe, and from British Consuls in France. Second Report of Royal Commission on Depression of Trade, App. , Part II., pp. 124 to 157. PART II. — RliTALIATION. 259 Lyons Trade. is officially reported to have decreased in 1884 by an Paris amount which, measured in money, would be ;^4o,ooo,ooo, '^'^'^^• and wages too have decreased by £14,000,000. The num- ber of hands permanently idle was reported to be 180,000 ; of hands temporarily out of work to be 48,000. Pauperism and relief had largely increased. The i)opulation of Paris is thought to have been seriously diminished. The export of articles de Paris and of Paris dress goods and ornaments fell off from £8,400,000 in 1875 to £5,600,000 in 1883, and to £4,720,000 in 1884. The yield of the Paris octroi fell off from six millions sterling in 1882 to £5,600,000 in 1884, and decreased yet more in 1885. At St. Etienne the silk produced had decreased from 93 to 43 millions of francs, and the hands employed in the gun trade from 10,000 in 1880 to 1,200 in 1884. At Lyons 100,000 of the hands employed were said to be hard hit. The exports of silk goods from France, which were worth nearly 420 millions of francs in 1874, were worth only 300 millions in 1883. The iron produced in the district of the Loire has fallen off by one-fifth. In the iron works of the Rhone district two-thirds of the workmen were said to be out of work. Coals, of course, followed suit. The exports of French woollen goods had fallen off by 1,500,000 kilos. Still worse has been the state of agriculture. Rents have fallen largely, small homesteads are deserted. The number of cattle in France, reported as 14,000,000 in 1852, are said to be now only 11,500,000. Sheep had been reduced from 33,000,000 to 22,000,000. Add to such facts as these the further fact that British trade with France, according to the French trade accounts, has suffered less than the trade of France with the rest of the world. The depression in France is attributed to many causes, Causes 01 some of which — such as general over-production, low depression, prices, and small prices — it shares with other countries ; but there arc others peculiar to itself, some of which are in- evitable, whilst some are due to human folly. The cholera, and the phylloxera, and changes in fashion, arise from causes which no amount of wisdom or statesmanship could have jM-evented. But the glut in iron and sugar have been, in part,'at any rate, caused by'^Protective duties and by bounties ; the difficulties of the silk manufacture have Agricul ture. 26o FREE TRADE V. FAIR TRADE. Causes of been aggravated, if not caused, by the Protective duty on depression. (>q^^qj^ yams ; other manufactures suffer in like manner by Protective duties on the materials which they require ; agriculture has suffered by the duties which make manu- factures artificially dear, and is now revenging itself by making bread and meat dear to the artisans. The heavy taxation caused by the German war is a serious burden on all French industry, and this has been aggravated by M. Freycinet's policy of subsidising public works extravagantly at the cost of the general taxpayers. The octroi, a tax on articles of town consumption, is believed by Mr. Crowe to act even more in restraint of trade than the Customs tariff. It amounts to nearly ;£6, 000,000 in Paris, and to nearly twice that amount in the whole of France. Our Fair Traders, it will be remembered, desire to place duties on French manufactures imported into England, on the ground that French manufacturers do not pay English taxes. It is pretty clear from these reports that the French manu- facturer complains, and has good reason to complain, of his own taxation ; and that even if it were i)0ssible to shift the burden of taxation from the English to the French manufacturer, by imposing Customs duties on French goods, no case could be made for doing so founded on the comparative immunity from taxation of the Frenchman. It is also clear from these reports that France is suffering from commercial depression at least as much as, and l)robably much more than, England ; that some of her protected industries are suffering the most, and that this suffering is in part due to Protection itself. 26l CHAPTER XLII. PRESENT DEPRESSION IN THE UNITED STATES. From the United States wc have similar accounts, though pepression the prospect, fortunately, appears to be now brightening a Unjted little. Mr. William B. Forwood, of Liverpool, a most State?, competent witness, said, in a letter to the Standard of i6th December, 1884 :— " It is not merely that the depression is intense ; there are towns where not a single factory has worked for months past, and tens of thousands of working men are literally starving, but there is no hope that things can be better — their only customeis are their own people ; the tariff practically prohibits exports, and it is said that there are sufficient cotton and woollen factories and ironworks to produce in six what they can consume in twelve months." The following is the account of the condition of United Mr. Mc- States manufactures given by Mr. McCuUoch, Secretary to rcport'^on the United States Treasury, in his annual report for 1884 : — the glut in " What the manufacturers now need is a market for [|||!g"g"'^'^' their surplus manufactures. . . . After the war, stimulus the United was found in railroad building, and in extravagant ex- States, jienditures induced by superabundant currency, and the time has now come when the manufacturing industry of the United States is in dire distress from plethora of manufacturing goods. " Some manufacturing companies have been forced into Ijankrujitcy ; others have closed their mills to escape it ; ti \v mills are running on full time, and, as a consequence, a very large number of operatives are either dej^rived of emiiloyment or are working for wages hardly sufficient to enable them to live comfortably, or even decently.* * From the British Trade Joiirtuil oi ist March, 1886, p. 148, we le.irn that the cotton manufacturers of Massachusetts are still having a very bad time. Out of 37 mil's mentioned, 24 paid no dividt nd in 1885, and 6 more only i pt r cent. 262 FREE TRADE V. FAIR TRADE. Depression in the United States. " The all-important question that presses itself upon the public attention is : How shall the country be relieved from the plethora of manufactured goods, and how shall plethora hereafter be prevented ? It is obvious that our power to produce is much in excess of the present or any probable future demand for home consumption. The ex- isting iron, cotton, and woollen mills, if employed at their full capacity, could meet in six months — perhaps in a shorter time — the home demand for a year. It is certain, therefore, that unless markets now practically closed against us are opened — unless we can share in the trade which is monopolised by European nations — the de- pression now so severely felt will continue, and may be- come more disastrous." Again he tells us that the total value of the exports of domestic merchandise amounted to 725 millions of dollars, as against 804 millions in the preceding j-ear, showing a decrease of nearly 80 millions ; and he i)oints out that, as re- gards shipping, the United States have almost ceased to be a maritime power — only 17 per cent, of her trade being carried in her own vessels. It is not often that a Minister can be found to give so unfavourable an account of the industrial conditions of his own country. But, unfavourable as it is, it is borne out, and more than borne out, by details obtained from other sources. Agricul- ture. Farming in the United States. No full inquiry has been made into the state of the agricultural interest of the United States, but there is general evidence that the American corn farmer is depressed no less than his brother. Thus we are told that wheat cannot be produced by American farmers at existing prices ; that the area of wheat has been diminished ; that the farms in the West are highly mortgaged at a high rate of interest amounting to as much as 10 per cent. ; that these advances were made on the basis of 80 cents to the dollar per bushel ; and that wheat is now selling at 16 to 40 cents, the expense of prcduclion being 40 cents per bushel.* * SliUhLtni, 29th of December, 1884. PART II. — RETALIATION. 263 Railways in the United States. Railways in the United Stales. Again, if we take United States railways, the fall in Depression their value during 1884 is very remarkable. Nearly forty un|j^ companies, with an aggi"egate length of 11,000 miles, and States, 5Ci43,ooo,ooo of capital and debt, went into the hands of receivers.* About 10 per cent, of the entire railway mileage and of the normal capital invested in railway stock and bonds of the United States went into liquidation. Nor did this process end with 1884. In solvent companies the " shrinkage " is very great. Mr. Atkinsonf estimates " that 7,000,000,000 dollars' worth of railway property apparently depreciated at least 1,500,000 dollars within the year — or, in other words, that perhaps 1,000,000,000 dollars of water (nominal capital) has been squeezed out, and during the process the true value of the remainder has been temporarily depressed 500,000,000 dollars." He points out the obvious reason — viz. that whilst during the j^revious four years the grain, hay, and meat cropj of the United States, which constitute one half the substances moved by railway, have not increased more than 10 per cent., the railway mileage has increased by 40 per cent. — viz. from 86,497 miles to 121,543 miles. J In a letter to Bradstreet's Journal of February 7th, 1885, the same statistician says that in 1882 about 650,000 men, mostly labourers, were employed in the mere construction of rail- roads, and that in 1884 ^^o^ more than 220,000 were occupied in this work — thus throwing out of this work above 430,000 men. Bankruptcies in the United States. Take, again, bankruptcies. The number of mercantile failures in the United States in 1884 was larger than had been ever known — even in the disastrous year 1878. The following is an extract from Bradstreet's Journal of Decem- ber 27th, 1884 :— " The rate at which the increase in mercantile mortality throughout the country, dependent in })art, of course, on the increase in number of business ventures, may be * Economist, 17th January and i6th May. 1885. + " Distribution of Products," p. 263. Putnam, 1885. X Ibid. , pp. 23s, 238, 240, 258. B;\nkrupt- cies in tiie United States. 264 FREE TRADE V. FAIR TRADE. Depnssion gathered Irom the following extract from Bradstreet's M ^^^A Journal :— United -' ^^^'*^^- ''J-\ii/iires in (he United Slates for Six Years, Vear. Kinibcr of Failines. Aggregate Assets. Aggregate Liabilities. P. c. As . ti to Linbitities. IS79 1880 1S81 18S2 1SS3 1884' 6,652 4.350 5.929 7.635 10,299 11,600 $ 48,906,000 27,430,000 35,964,000 47,469.000 90,804,000 130,000,000 $ 99,636.000 57,120.000 76, 094, 000 93,238,000 175,968.000 240,000,000 49 4S 47 i;i 52 54 * Partly estimated. " Here is a probable increase of over 12 per cent, in the total number of failures for 1884 as against 1883, a prol)able gain of 44 per cent, in assets and of 37 per cent, in liabiHties. The totals for 1884, furthermore, promise to exceed any previously recorded annual total, the largest heretofore having been given as 10,500 failures in 1878, with 234,000,000 dollars liabilities. If a comparison may be instituted between 1884 and 1878, with these totals, we find that the current year is likely to have 1,100 more failures than that in which the greatest commercial de- pression was experienced prior to the revival of trade in 1879, ^'^^ that the total liabilities of failing trades in 1884 promise to be about 6,000,000 dollars greater." The actual figures for 1884, together with those for 1885, as given in Bradstreet's for January 9th last, are : — Year. Number of Failures. Aggregate Assets. Aggrtgate Liabil'.t'es P. c. Assets to Liabilities. 1SS4 1885 11,620 11,116 134,620,000 55,265,000 24S 740.000 I 19,120,000 54 46 Compare these figures with those of Ixmkruptcies in Enghmd, for which the official figures arc as follows : — PART II. — RETALIATION. 265 Number 0/ Bankniptcies proper, Liquidalions, Schemes of Arrangement, and Compositions. No. 1S81 9.727 1882 1883 1884 1885 Bankrupt- cies in England. 9,041 8.555 4.192 4.354 Considering the effect of the Bankruptcy Act of 1883, it would, of course, not be fair to take these English figures as absolute tests of the comparative commercial solvency of the trading classes in the several years referred to. The Act of 1883 has probably had the effect of preventing official insolvencies, and also of increasing private arrange- ments, though whether this has been the case to any great extent is very uncertain. But it may, at any rate, be concluded from the above figures that there was no special unsoundness in the trade of England during the years 1884 and 1885, such as is shown by the insolvencies in the United States. Clearing House Business in the United States. Take again the amounts cleared at the London Bankers' Clearin Clearing House, and in New York, in each of the years from 1878 to 1884 inclusive : — In Thousands ok ;^"s. At the I.onijon I'.ankf.rs' Clearing House. In New Vokk. Years. Total amounti cleared. Increas(« or decre.ise in e.ich year compared with the previous jear. Total amuunl!; cleared. Increase or decrease in each year compared with the previous year. Amount. Per ceiu. Amount. Per cent. 1878 1879 1880 1881 1882 1883 1884 1885 usiness that trade is generally good in the one country at or about the same time at which it is good in the other, and vice vcrsd. Under these conditions, when trade is good, or fairly good, in both countries, the attractions of the United States are, as we have seen, not only positively, but proportionately gi^eater than at other times, and con- sequently at such times the balance of emigration to the United States increases. This accounts for the fact that emigration is often greatest when times arc good in this country, a fact which has been })erverted by the Fair Traders into a suggestion that emigration is the real reason * See Mr. Giffcn's Report on Emigraiion, Parliamentary Paper, No. 53, of 1885, and preceding reports. t See Mr.Giffen's "Essays on Finance," No. iv., page 133, on the depression of trade in raw material producing countries. PART II. — RETALIATION, 267 why pauperism diminishes ! * When the times become less Depression good in both countries, the comparative attraction of the united United States becomes less powerful, a return tide of states. immigration sets in, and the balance of emigration from Emigra- this country becomes less. This is what has happened lately. "°"- There was a revival of trade in 1880, which went on till 1882-1883, and the balance of emigration from this country and into the United States went on increasing. About that time depression commenced in both countries. The balance of emigration following this depression con- sequently decreased, showing that the comparative at- traction of the United States for the labour of this country decreased — or, in other words, that the United States have been having a very bad time. There are symptoms that things in the United States are now on the mend, which is a hopeful sign for us, as the pendulum of trade, in its ordinary oscillations, moves both faster and farther in the United States than it does with us. Subjoined are the figures for recent years : — Total arrivals in, and departures frotii, the United States, from and to all countries. Excess of arrivals over departures. 135,825 425,458 631,640 735.648 554,561 461,785 291,119 Eniis^ration to, and immigration from, the United States, from and to the United Hingdom, of persons of British and Irish origin only, each year from 1S79 to 1885, and in the first six months of the year i8S6 : — Arrivals. Departures 1879 ■ 253,210 117.385 I8.S0 534,465 109,007 IS8I 743,712 112,072 1882 869, 1 44 133.496 I8S3 712,515 157.954 1884 649,491 187,706 i8i>5 535, CKX} 243,890 Emigration to Immigratiun from Period. United States from United States United Kingdom. to United Kingdom. Year 1879 91,806 20,048 „ j8So 166,570 26,518 „ 1881 176,104 29,781 „ 1882 181,903 28,408 „ 1883 «9i,573 46,703 „ 1884 155,280 61,466 „ 1S85 137.6S7 57,604 Six months cndc •d] 30th June, 18S6. 75.224 35,503 F.iir Trade Tosition Explained," p. 64. 268 FREE TRADE V. FAIR TRADE. Employ- Employment of Labour in the United States. TbouHn Take, again, the most important feature of all — the United employment of labour. Our own newspapers have been States. full of reports of the depressed state of labour in the Bradstreefs United States.* But the most imjiortant evidence is to report!'^" be found in Bnidslyect's Journal. This newspaper, at the end of 1884, instituted a careful inquiry into the state of the leading manufacturing industries in the twenty-two Northern States of the Union. The results are stated as General follows : — " There has been a general reduction in wages reduction varying from 20 to 25 and, in some cases, to 30 per cent., in\\ages. taking the year through. The reduced forces {i.e. number of men) at work range from 33 per cent, to 12 per cent., not including reductions in clerical staff. . . . The total number reported out of work, due to shutting down of establishments, to enforced reduction of forces, or to strikes, is 316,000, or 13 per cent, of the whole number busy in 1880. Of these, the number out of work by strikes is not more than 5-3 per cent. ' There are no less than 55,000 industrial workers idle in New York, exclusive of clerks and salesmen.' ' In Philadelphia not less than 33,000.' ' At Pittsburgh, nearly 11,000,' " and so on.f The aggregate number of manufacturing operatives thrown out of work is estimated at not less than 350,000. How many of these men have found other emplo}-ment, or where, is not known, but 350,000 fewer are reported to be employed on these industries than were so employed two years ago, and there is very great distress and want of employment. Further inquiries into the ratej of wages have furnished the following results, J which are sufficiently important to be quoted in extenso. RATES OF REDUCTION SINCE JULY, 1882. " Lines in which Lower Wages and Fewer Employes are Conspicuous. " In December, 1884, Bradstrcet's undertook to report the extent to which industrial workers had l)een thrown * See, for instance, Tinus, Feb. 4th, 1885 ; Rconomist, Jan. 3r(l, 1885, &c., i.tc. t Diddstreet's, coth Dec., 1885. % ''^"'•. Mth March, 1885. PART II.— -RETALIATirN. 269 out of employment in the United States during two and Depression one half years last past. The investigation was one unique Vl '^^ , in journalism, and was met by fairly satisfactory results, states, the showing being that about 350,000 fewer operatives General were then employed than in 1882, or about 14 per cent, reduction In the present instance it has undertaken to get the neces- '" *^g"- sary data to determine the extent to which industrial workers' wages have been reduced during the same })eriod. " The inquiry embraces the leading manufacturing in- dustries in the United States — those in which the value of the goods annually produced is equal to or in excess of 30,000,000 dols. It was manifestly impracticable to extend the investigation at this time to every city and town at which these industries are prominent. " In order to furnish a fair and sufficiently comprehen- sive exhibit of the rates of wages i)aid and received weekly, inquiries were extended, in each case, to the leading establishments in each industry at seven cities or towns. The cities were selected on the basis of the amount of capital invested and value of products in each line, and are given in order under appropriate classifications by in- dustries. " In the lines of industry covered there were, in 1880, 194,500 establishments in the United States out of a total of all manufacturing concerns amounting to 253,800, nearly 77 per cent, of the whole. The number of hands employed was 2,005,000 out of 2,732,595, or 73 per cent. The total wages paid by them annually amounted to 688,361,961 dols., out of a grand total of 947.953.795 dols., or 72 per cent. The annual value of materials used was 2,654,702,809 dols., out of an aggregatcof 3,396,823,549 dols., or 77 ])er cent., and the annual total value of ]-)roducts was 4,101,889,676 dols., out of a grand aggregate in all industrial lines amounting to 5,369.579.191 dols., or 76 prr (cnt. The industrial wages investigated represent, therefore, those at seven cities in order of prominence, and may be regarded as fairly typical of the rates paid to three- quarters of the industrial workers of the country. The investigation has been conducted at sixty cities, from which over 250 separate reports have been received, 270 FREE TRADE V. FAIR TRADE. involving at least 1,500 sjxxial inquiries by correspond- ents of Bradstreet's. This docs not include instances where information was refused, or where it was furnished, but appeared to be faulty or likely to mislead. " There are three primary facts to be taken into account in studying the classified tables of wages presented below : — " I. With the restricted call for products, and in the effort to maintain wages — under pressure from workers to have them maintained — marked reductions in the number of emploj'es have been made since 1882, as pointed out in Bradstreet's, December 20, 1884. As will be recalled, it was then shown — that the enforced reductions in the num- ber of employes, those thrown out by shutting down of factories and mills, and by strikes and lock-outs (since 1882), amounted (as reported) to 316,000 in 21 States, where 90 per cent, of the total of industrial workers were employed ; that the grand total was probably nearer 350,000 than 316,000, or say 14 per cent, of the total en- gaged in 1882 ; that at least 80,000 fewer iron and steel, machinery and foundry, workers were emplo3'ed — or 23 ]ier cent, of the total dispensed with ; that 35,000 fewer clothing operatives (east of Ohio), or 10 per cent. ; 20,000 fewer cotton goods operatives, about 6 per cent. ; 24,000 fewer woollen fabric operatives, or 7 per cent. ; about 13,000 fewer tobacco operatives, or less than 4 per cent. ; and about 4,700 glass workers, or say 1*3 per cent, of the 350,000 displaced — had been thrown out. This has been one element in helping to maintain the rate of wages of those remaining at work. The total displaced, as enumer- ated, number nearly 177,000, or about 51 per cent, of those whose services had been done away with. "2. Work has been restricted at various establishments, hours having been shortened, or work furnished fewer days in the week. "3. Employes have been given piece work in place of a stated sum per day, week, or month, the quantities furnished being limited in many cases. " In addition to these, strong trades unions among iron and steel, glass workers, building trades, boots and shoes, tobacco and textile operatives, and in other lines, have PART II. — RETALIATION. 271 brought a pressure to bear to prevent reductions of wages, frequently to gain an advance. " The reductions in rates of wages in most all instances are less than the gross reductions in amounts received within two and one-half years. The percentages of rate reductions calculated indicated, therefore, the apparent cut ; in some cases (generally specified) it is actual, but the losses due to restricted time, or to a limited quantity of piece-work, are not always a determinate factor. " Several features of the exhibit are nevertheless more striking than any late developments regarding our manu- facturing industries. " Six highly protected industries, iron and steel {also foundries and machine shops, etc.), clothing, cotton, woollen, tobacco, and glass manufactures, which employed 34 per cent, of all industrial workers {as reported in 1880), have thrown out one-half of the total number of workers since 1882, 177,700 in number, as reported by ' Bradstreet's ' in December, 1884. " All of these lines have run nearly, if not quite, as much on short time as any others named. " They, with other textile establishments, have practically had a monopoly of the larger strikes of the past year or two, ivith the exceptions of those in the coal regions. " And, as exhibited ivith sufficient detail for generalisation in the wages report given below, they have suffered, on the average, a greater reduction in rates of wages paid. " Iron and steel workers and coal miners have suffeied by far the greatest reduction in wages from all causes, and are followed by operatives in textiles. Glass-makers, thus far, have suffered less, proportionately, than the above, and then only in certain departments of labour. Ex- cei)ting tobacco and cigars from food products, and the latter have suffered least of all. Wages rates in the build- ing trades and wood-working industries have been only moderately depressed. Workers in leather have not found their wages cut severely, and jxiper mill employes and printers have escaped with but a moderate i^eduction. The average reduction in rates of wages ])aid and received in the various lines covered have been classified as follows ; — Depression in the United States. Employ- ment of labour. Protected industries have suffered most. Steel and iron have suffered most of all. 272 FREE TRADE V. FAIR TRADE. " Food Troducts. Flour mill Bakery Slaughterhouse Sugar refining (in rates paid) Liquors, malt ... Liquors, distilled Tobacco, cigars Tobacco, chewing and smoking Textile Products. Woollen goods, cloths (based on short time) Woollen goods, clothing (men's) Woollen goods, clothing (women's) Cotton goods (cuts and short time) ... Silk goods (Paterson) Metal Products. Blast furnaces (eastern) Blast furnaces (southern) Blast furnaces (western) Iron mills (eastern) ... L-on mills (western) ... Steel rail (western) ... Steel rail (eastern) ... Nail mill (western) (in rates paid) ... Tinware Agricullural implements Foundry and machinery LuMiJER AND Manufactures. Lumber, sawed and ]>laned Sash, doors and blinds Coopers Furniture makers Building Trades. Av. perct. reduc- tion w.iges. None None None None ... lo to 12 ... lo to 15 ... 10 to 20 25 to 30 10 to 15 10 to 15 25 to 30 15 to 25 It 20 12 15 to 22 15 to 22 30 20 None 10 Little 10 to 15 Little S to 10 10 to 15 10 to 15 Carpenters ... Stone and marble cutters Brick-makers Little Little Little Leather and Manuf.vctures. Tanned and curried workers Harness and saddlery workers Boot and shoe workers Paper-makers Compositors Glass-makers — One class... Another class Others Shipbuilding Coal miners Little 10 10 Little Little Inc. 10 Dec. 18 Same 20 lo 40' PART II — RETALIATION. 273 These figures from Bradslreet' s report seem to deserve Depression special attention ; and they are confirmed by the reports ^/-^.^^ made to the Commission on the Depression of Trade. Sir Staus. L. West tells us* that 430,000 men employed on the con- Empioy- struction of railways and 250,000 employed in factories "i^nt of were thrown out of work ; that cotton manufacture in Report Philadelphia was suspended ; that the india-rubber manu- by sir l. facture was discontinued ; that the sugar refining industry ^^^'■ was reduced to 60 per cent, of its previous value ; and that some of the most important iron furnaces and rolling mills were closed. Further, that the industries which chiefly suffered were the iron, steel, and textile trades, all of them highly protected ; that the demand for iron and steel fell off by 700,000 tons, causing in its turn on the part of the men emploj-ed in them a failure of demand for textile^ and other things. It must not be supposed that the 680,000 men thrown out of work failed to get employment. Such are the natural resources of the United States that men thrown out of work in factories find employment on land more readily than in crowded Europe. But the lesson is the same. The protected industry fails, and the unprotected industry, the industry which Nature provides, comes to its help. I have elsewhere given details concerning certain special manufactures in the United States — viz. of clocks, woollens, copper, and steel rails — all pointing to the same conclusions, viz. that the manufacturing industries of the United States have been much more depressed, and are in a less healthy condition than our own ; and, further, that the industries which have been the least healthy and most suffering are those which have been most protected — viz. shipping, iron and steel, and textiles. * Second Report, App., Part II., p. 372. 274 All branches of Trade and Agricul- ture much depressed. Russia's natural wealth is agriculture. She has starved this, and has fostered sickly manufac- tures. CHAPTER XLIII. PRESENT COMMERCIAL DEPRESSION IN RUSSIA. Russia and the United States are two of the most Pro- tectionist countries in the world, and the recent condition of their respective industries affords some materials for instructive comparisons. In Russia, as in the United States, trade has been and still is in a state of extreme depression. Mr. Mitchell, H.M. Consul at St. Petersburg, says : * " The economic condition of the whole empire is admitted to be in a depressed state, and this depression applies both to all branches of industry and to the foreign ^d home trade of the country." " Agi-iculture, which serves as the chief foundation for the prosperity of the country, is in a state of prostration." In 1884 the value of the exports, consisting chiefly of agricultural produce, was diminished by ;;r4,200,ooo, and during ten months of 1885 by £6,165,000. Between 1880 and 1885 the imports decreased by more than one-sixth (£10,000,000) ; and during the first nine months of 1885 by a further amount of £,9,000,000. The Customs revenue has fallen off by about two millions and a half sterling, and the revenue from internal taxation has also fallen off. Credit is at a low ebb, and capital ceases to flow into the country. A few manufacturers may make fortunes, but the country suffers. Sir R. Morier entirely confirms these statements, and calls special attention to the distress in the cotton and sugar trades. Nor does there seem to be, as there is in the United States, any immediate prospect of recovery. Russia is essentially an agiicultural country, and possesses besides natural resources in coal, iron, and petroleum. One would have thought that the policy of the Russian Government would have been to encourage as much as possible the cultivation of the land — depressed as that industry has been by the changes consequent on the abolition of serfdom, and by the competition of corn from America, India, and Australia in the markets of Europe. * Second Rei)ort of Commission on Depression of Trade, App., Part II., pp. 291, 292. PART II. — RETALIATION. 275 To improve the imperfect means of communication in her vast territory ; to make all implements and articles of clothing or comfort used by the rural population as cheap and as good as possible ; to attract labour to the land ; and to encourage exportation of the produce of the land, would have seemed the natural objects of a Russian states- man. But Russia's policy has been of an opposite kind. She has since 1877 done all she can to discourage the import of all manufactured goods by an almost prohibitive tariff, and by Customs regulations which are as bad as the tariff. She seems now to be contemplating further measures which will be absolutely prohibitive. This is done for the sake of encouraging sickly manufactures which provide her people with dear and bad goods. The effect upon her agriculture is to make all necessaries of life, except those which they produce themselves, scarce and dear ; secondly, to make agricultural labour scarce and dear by attracting workmen from the land to the factories ; and, lastly, to cripple the foreign market for Russian agricultural pro- duce by refusing to take anything from foreign countries in exchange. Of her special follies in the matter of sugar I shall speak more fully below, in Chapter XLVIII. Under any circumstances Russia would probably have had great difficulties with her land and its cultivation ; but the result of her deliberate policy has been greatly to aggravate these difficulties ; to make her rural population ]:)Oorer ; and at the same time to produce glut and dis- tress in the sickly manufacturing industries which she has been fostering by unnatural means. The United States have escaped the worst consequences of their bad tariff by means of their immense natural resources, their excellent land system, and the energy and versatility of their people. Russia is far less fortunate in these respects, and suffers proportionately more from her bad fiscal policy. 276 CHAPTER XLIV. PRESENT COMMERCIAL DEPRESSION IN BELGIUM. Report of On the depression of Belgian Trade there is an excellent Mr i-ane report by Mr. Fane, H.M. Secretary of Legation at Brussels.* on dcprpS" sion in Bel- It is a Very interesting case for several reasons, and amongst gium. others because the present state of things in Belgium has been carefully examined by several competent inquirers. The commercial condition of Belgium resembles that of Great Britain in many respects. Belgium has a crowded population ; a highly developed system of agi'iculture, though different from our own ; productive coal-fields ; great manufacturing industries ; and a very complete system of railways. It has a large foreign trade, and its imports exceed its exports. Its institutions are like our own — popular and democratic ; it has a moderate tariff ; and it has remained true to the principles of Free Trade. Under these circumstances it is interesting to find that the S3'mptoms of depression are much the same as with us. Mr. Fane sums them up as follows : — 1. " The duration of the depression is persistent, and there is no sign that under the present order of things it will come to an end." 2. " While the prices of all commodities continue to fall, the volume of business tends to increase. Values never were so low, production was never so great — though at the present moment it is beginning to fall off." 3. " The distress has, till quite recently, fallen almost exclusively on capital — i.e. on profits — and hardly at all on labour — i.e. on wages. But capital is now beginning to call on labour to content itself with a lower rate of wages, in order to contribute thereby towards lessening the cost of production." Recent The coursc of trade in Belgium f(ir the last twenty years ?1'^J^^ °^ has been much the same as with ourselves. There was great inflation of prices and profits in the period succeeding the Franco-German war, and subsequent collapse, accom- panied throughout by a large and general steady increase * Tliird Report of Commission on Depression of Trade, App., p. 444. trade. Profits in francs. Wages per man. 10,690,000 715 6,259,000 914 PART IJ. — RET.ALIATIOK. 2/7 of production and a rise of nominal wages, which, how- ever, are now beginning to fall. Taking coal as a leading industry, and omitting the period of the coal famine, during which prices were ex- ceptional, it appears that the comparison between 1864 and 1884 is as follows : — Production 'n tons. 1S64 ... 11,158,336 1^84 ... 18,051,126 Of the total amount of the proceeds of the mines for Produc- the six years ending with 1884 it is calculated that 98 Rt^'and' per cent, went to the workmen, and 2 per cent, only to wages in the mine-owners. Other industries appear to show similar !^°^' "^'"' results. The absolute value as well as bulk of the whole '"^' productions of the country, the raw materials imported, the railways o])en for traffic, the steam-engines emplo\'ed, the aggregate imports and exports, the number of in- habited houses, have all increased enormously ; whilst the bulk of agricultural produce seems not to have decreased. The material wealth of the country is much greater than it was. But it is differently distributed. Capital is suffering ; ])rices are low ; interest has fallen ; profits are very low in all trades, and in some reduced to zero. On the other hand, the bulk of the pojnilation is better housed, better clothed, and better fed, in every way better off than it has ever been. A calculation by an eminent statistical author- ity is quoted to the effect that in 1840 the wages throughout Belgium amounted to 500 miUions of francs, when the ])opulation was 70 per cent, of what it is now, and that if wages had remained at the same level they would have amounted now to 700 millions ; whereas, as the same authority calculates, the actual amount of wages at the ])resent time is 1,625 millions of francs. So far there does not seem to ]>e much disjnite about Causes of the facts. But upon the causes and })robable consequences depression of the present state of things there is considerable differ- ence of opinion. The unsettled state of the currency (juestion, and the relative fall in silver ; the Protectionist jiolicy of neighbouring Continental States ; the com- 278 FREE TRADE V. FAIR TRADE. petition of agricultural jn'oduce from Asia and America ; the competition of foreign, and especially of German, manufactures ; the factitious production of sugar — are all referred to as partial causes of the present depression. One eminent authority appears to think that the power of consumption of the world, in respect of some j)roducts, such as iron, is reduced, because the renewal of the in- dustrial ]:)lant of the world, necessitated by the introduction of steam, has now been completed. As a partial explana- tion of the cessation of demand for permanent plant such as steel rails, som3 weight may be due to this consideration. But to say that the general and permanent powers of con- sumption of the world are diminished because it has per- fected and improved the machines, the steamships, and the raihvays by which it creates and distributes its produce, seems to be like saying that a man is less comfortably housed because the building of his house is at an end. Prices. 'pj-^g great question, however, which is being discussed wages^.' ^" in Belgium relates to the change w'hich has taken place in the distribution of the produce of industry between em- ploj'er and workman, between capital and labour. This has, as above noticed, been very remarkable. Wages have risen, whilst prices and profits have fallen. Similar changes have taken place in Great Britain, in France, and in the United States, as is shown by the researches of Mr. Giffen, Mr. Leroy Beaulieu, Mr. Atkinson, and other competent observers. The effect of this change has therefore a world- wide importance, and the discussion concerning its meaning and effect which has taken ])lace in Belgium has a deep interest for other countries. Mr. Pirmez, one of the foremost statesmen and econo- mists of the country, regards this change as a natural " economic evolution " ; an alteration in the distribution of wealth by which, if the richer become poorer, the millions who toil become richer ; a change, in short, which economic laws would lead us to expect, and which, so far from being lamentable, is one in which every j)hilanthropist, every economist, every statesman must rejoice. Others, again, differ from Mr. Pirmez, and tliink that labour has received more than its due share of the ]:)roceeds of in- dustry ; that this is the principal cause of what is callecj PART II. — RETALIATION. 279 No resusci- tation of Protection. commercial depression ; that the profits on capital are ceasing to be sufficient to operate as an inducement to save and to invest in })roduction ; that, in consequence, pro- duction itself is falling off, or likely to fall off ; and that if production is to be maintained, labour will have to sur- render some part of its share of the proceeds by the re- duction of nominal if not of real wages. It is impossible here to follow up this great controversy ; but I wish to call attention to what Belgian economists are saying about it, since in the discussions on the causes of depression which have taken place in this country it has scarcely received the attention it deserves. I will only observe that the latest statistics in Belgium appear to give weight to the arguments of those who think that wages will have to be reduced ; whilst the recent disturbances and the present attitude of the workmen look as if this would not be effected without suffering or without struggle. As regards the more immediate subject of this book, it is pleasant to find that in one country, at any rate — and that one a country which resembles our own — there is no suggestion that the present depression is due to Free Trade, and no attempt to meet it by a resuscitation of Protection. The advocates of Free Trade are still in the ascendant, and are listened to as they deserve to be. The reasons why ]:)Cople of sound sense on other matters are found who gravely maintain the ])rinciplcs of Protection, and the ex- posure of the fallacy of those reasons, can hardly be better put than they are put by Mr. Pirmez in the following Mr. Pirmez extract from Mr. Fane's report : — " His Excellency says °ioJst°^,^'^' that there are two causes for ' this strange aberration.' The first of these is that Protective measures are often able to remove promptly an evil which is felt by individuals or by an individual class. Agi^icultural rents sink or the profits of the sugar lousiness fall, owing to the importation of grain or of sugar. What more simple than to improve rents or to insure good jirofits on sugar ? Impose an import duty on gi-ain or on sugar, and the desired result is at once effected. This result we easily ' see,' but behind this result which we see there are results which we do not as easily see. First of all, there is a tax placed on all who eat bread or consume sugar, and then there is a positive 28o FREE TRADE V. FAIR TRADE. interdiction to do so laid on those who wish to manufacture goods to be exported in exchange for im^)orted grain or sugar. The operation has been hkc that of a quack remedy which removes an eruption on the skin, but in doing so produces a serious internal disorder. But the patient sees the direct and immediate good which has been effected ; the indirect evil which will follow he does not see. The second cause for the success of the delusion is that ' the direct effect of Protection benefits a small body of people, whilst the indirect ill-effect is distributed (diluted as it were) over the mass of the nation. Now, an interest is infinitely more powerful when it is concentrated on a few heads than when it is broken up and divided fractionally among a number of people. Its force is very great in the first case ; in the second it becomes a nullity, with no more power of resistance than particles of dust.' " CHAPTER XLV. GENERAL REMARKS ON THE PRESENT COMMERCIAL DEPRESSION. ^"^ ,, It is quite clear that the i)resent depression is universal, ture of the and that in Protectionist coimtries it is as mtense, probably present de- much morc intense, than it is in our owai. Nor, except over^pro-^ perhaps in the United States, are there any signs of future duction or recovery which do not exist in this country. It would, as I s'ut- have said, be impossible and out of place here adequately to consider the various symptoms of the disease as it exists in different countries ; still more to discuss the numerous remedies which have been suggested. But there arc one or two observations, bearing on the subject of this book, which may be made with advantage. There is one feature common to the disease in all places and in all countries— viz. a glut of manufactured goods ; more iron, more steel, more ships, morc sugar, more cotton, woollen, linen, jute, and silk fabrics than can be used or PART II. — RETALIATION. 281 disposed of at a profit. The volume of trade has not decreased, or has decreased by very Httle ; but prices are unremunerative and profits very low. Supply has over- taken and more than overtaken demand. From all nations comes the same stoiy : from Free Trade nations such as England, Belgium, and Switzerland ; from semi- Protection- ist nations such as France and Germany ; from Pro- tectionist nations such as Russia and the United States. In the case of corn there can scarcely be said to be a general glut, though certain markets may be overstocked for a time ; and even non-European countries which formerly supplied it suffer by the development of new sources of supply. Now, there are many causes of glut and over- production over which Governments and laws have little or no control, and in which demand and supply reign supreme. There are also causes of glut which are due to human action, and these have been largely at work in the present commercial crisis. It is precisely those things which Governments are trying to foster by Protective duties and ]:)rohibitions in which the glut is most con- S])icuous. Metals and metal wares, textiles, sugars, these are the things which are produced in such abundance that they find no sale, or find no profitable sale ; and these are the things which, if made abroad, the United States and Russia, France and Germany, Canada and the Australian Colonies (always excepting New South Wales) are excluding from their markets. At first sight this appears a paradox. Can exclusion and restriction ]M-omote extravagant pro- duction ? That it causes dearness and scarcity is obvious to everyone except a thorough-going Protectionist, but that it should also cause over-production and unremu- nerative prices is what might not at first sight seem prob- able. And 3'et this is what economists have taught, and. as the event proves, have taught truly. The first and immediate effect of Protection in a Effect of country is to raise prices to the consumer. Whilst this Protection lasts imjiortation goes on ; the duty actually received on !"„' n^fi''^ im])orted articles goes into the public exchequer ; whilst the increase of price of home-made articles goes into the pocket of the native producers. The ]in)fit tlius niide gives an unnatural stimulus to production. Cai'ital is 282 FREE TRADE V. FAIR TRADE. improperly and unhealthily attracted to the protected trade ; and the home competition becomes at last so severe as to reduce the price of the home-trade article almost to the level of the foreign article. Protection ceases to raise the price, though it keeps out the foreign article. Then comes a i)lethora of home-trade goods ; the trade ceases to be profitable ; manufactories are shut up, and workmen are turned off, or have to take very low wages. Exportation may take place for the moment, but it cannot last or be profitable, because Protection has so raised the cost of manufactures as to make it impossible to compete with foreign manufacturers in neutral markets. This is exactly what we are told has happened in the United States, in Russia, in France, in Germany, in Canada, and in other Protectionist nations. Protection has caused a glut ; glut has caused reduction of profits ; and loss of profits has caused reduction of work and employment. Germany and Russia, and possibly other nations, have managed to meet this glut by the original experiment of selling dear at home and cheap abroad — of giving directly or indirectly a bounty on exportation. Thisciuses Such a practice is suicidal ; it gives unnaturally cheap ^'^d^'^^ff^^^ goods to other nations at their expense ; it must conse- ng. quently injure them, and it cannot last. But whilst it continues it disturbs legitimate business, and in so doing injuriously affects the trade of the world. This one So loug as scasous and climates vary, so long as men de"ressLn '^^'^ Subject to liopes and fears, commerce and industry will is human be subject to somc of those ebbs and flows which cause and pre- go much uncertainty and so much human suffering. To what IS mevitable we must submit. But it is sad to think that these ebbs and flows are aggravated by the folly of Governments which, by intercepting the gifts of Providence in one direction, and by api:)lying an unnatural stimulus in another, check natural ])roduction, and stimulate un- healthy industries into unnatural activity, to be followed by equally unnatural and unnecessary prostration. So great is this mischief that if it were possible by a league amongst all nations to prevent any one of them from interfering with supply and demand, such an object might almost justify temporary Retaliation. But any veritable. PART II. — RETALIATION. 283 such scheme is Utopian, and to attem])t it by means of RetaUation would be Hke seeking for universal peace by general war. There is nothing for us in the meantime but to accept the cheap goods other nations insist on sending to us, and to wait till they learn that they are injuring themselves. It seems probable that it is the great prosperity of England in the earlier part of this century which has misled the world. England led the way in manufactures, and especially in iron and in textiles. Other nations said to themselves : " England's prosperity is due to manufactures, and to manufactures of a particular kind. If we can but make the same things as she does we shall be as prosperous as she is. We will compel our people to do this, at what- ever hazard to things which we can make better than England. England shall not have manufacture all to herself." And thus because England happened to have peculiar facilities for doing particular things to the great advantage of herself and of the world, other nations which have not the same facilities for doing those particular things, but greater facilities for doing other things, have set them- selves to do what they ought not to do, and have not done what they ought to do. And in this they think that they are imitating England's example ! It must not be su}:)]x)sed that because I have thus em- phasised that one cause of de]M-ession with which this ])Ook is specially concerned, I attribute the depression solely to this cause, or overlook its general character, and the numerous causes which have contributed to it. The depression is general throughout the trading world ; it is a depression of values rather than of volumes ; of prices and of profits rather than of wages. Production and consumption are on the whole as large or nearly as large as they have ever been, and a much larger number of persons subsist in greater comfort than has ever been the case before. At the same time the reduction in prices and ]nofits has at last reached wages and emi)loyment ; s])eculation and enterprise are deadened ; and it is as yet vmcertain whether and how far production may be affected. To dogmatise on such points would be absurd. Nor does jt seem to me possible to state positively and definitely Attempt to imita'e England by non- natural means. General character and numerous causes of depression. 284 FREE TRADE V. FAIR TRADE. I'crnianent causes. what are the causes of the depression, and what import- ance is to be attached to each of them. It is obvious that they are not simple, but many, and of different kinds, and that whilst some are temporary, others are of a more permanent character. Bearing this in mind, we may, perhaps, summarise the different causes which have been suggested as follows : — Among the more temporary causes may be mentioned — 1. A reaction from the inflation of 1871 and the follow- ing years. 2. The comparative cessation of work in constructing the American and other railway systems, and the reaction from the abnormal demand for labour and materials which was created by that construction. 3. The reaction from the abnormal demand for shipping which prevailed down to 1884. 4. The collapse in the prices of coal and iron, caused by these reactions. 5. A succession of bad harvests in England and in Continental Europe. 6. Changes in rapidity of communication and in the mode of doing business ; by which stocks are economised, and the merchant and middleman dispensed with. Among the more permanent causes, which seem to have made the present depression chronic, may be men- tioned — 1. The natural fall in the rate of interest and profits, caused, as economists tell us, by saving and investment progressing faster than ])opulation and demand. 2. The appropriation to labour of so large a share of the proceeds of industry that the margin left for profit on capital, and for reward of skill and energy, is insufficient to encourage saving, investment, and enterprise. This must be regarded at ])resent merely as a speculative suggestion. 3. The appreciation of gold, and the consequent fall in jn'ices, which operates on the mind and imagination, if not on the pocket, and thus chills enterprise and specu- lation. 4. The comi)eliti(>n ol the agricuUuie of other (piarter? of the globe with that (4 Europe. PART II. — RETALIATION. 285 5. The natural competition of all civilised and pro- gressive countries in manufacture. 6. The unnatural stimulus given to this competition by Protective systems and by Bounties, causing in the first instance a withdrawal of capital and labour from those objects to which they might be most profitably applied ; and causing in the second instance glut, over-production, and suffering to the protected interests themselves. Of these causes most cannot be prevented or interfered with by human agency ; some of them are distinctly beneficial to mankind ; and some bring with them their own cure. None of them point in the slightest degree to the prin- ciple of freedom of exchange as a cause of depression or distress ; whilst the last which I have mentioned — viz., the system of Protection and Bounties — is a violation of that principle. I have placed it among the chronic causes of depression, but trust that I may be wrong in so doing, and that Protectionist nations may recover their senses and, by recurring to a more natural system, show that this particular form of commercial disease is temporal y, as well as unnecessary and self-created. 286 CHAPTER XLVI. SHIPPING. Shipping of go much has been said about shipping that I am almost the United ■ • r r o Kintrdom. afraid of referring to it, but it is so striking an instance of the advantages of Freedom and the impotency and mis- chief of Protection, that I must state the figures again. Statement of tht Percentage of the Fonign Trade of the Umted KitigJom carried on in British ships compared (in thousands of tons). Tolal I-orcign Total Carrie tl in Proportion of Tot.il Trade Averajje of live Years. Trade. British Ships, Carried on in British ShipF, (Millions of Tons.) (Millions tf Tons) (Per Cent. 1 1855-9 8 13 erg 1860-4 10 16 615 1865-9 10 32 687 1870-4 »4 28 6V7 1875-9 16 35 68-6 1880-4 18 43 70"6 1885-9 18 49 73'i 1890-4 20 55 73'3 1895-9 26 63 70 B 1900 36 62 63-3 1901 34 64 65-3 190.! 36 64 640 Statement showing the / ro/ortion of the Tonnage of the United Kingdom to the Tonnage of certain Fonign Countries at different Datis, multiplying steam tonnage by FOUR to reduce it to a common denominator 'vith .'ailing tonnage (in thousands of tons) United Kingdom. Foreign Countries. Total Year. 1 ( 1 housaiids of Thousands of Per cent, of Thousands of Per cent, of I ons). Tons. Total. Tons. Total. i860 S.942 42 8,143 58 14,085 1870 «,95o 49 9,231 51 18,181 1880 14,679 57 11,182 43 25.861 1883 i«.37i 59 12,873 41 3 ',244 1884 19,187 59 13.438 41 32,625 PART II.— RETALIATION. 287 The foreign countries included in the foregoing figures British are :— France, Germany, Holland, Belgium, Austria, Hun- Shipping gary, Italy, Sweden and Norway, Denmark, Greece, and the United States (over-sea tonnage). In 1902 countries in the above table had 13,699,000 tons of steamers and sailing vessels of over 100 tons register, while the United Kingdom had 14,431,000 tons, or 5r3 per cent, of the total. The shipping of the United Kingdom and Colonies for the same year amounted to 15,547,000 tons, nearly 50 per cent, of the world's total shipping — 32,437,000 tons. The figures relate to the mercantile marine only, exclusive of warships, and state the gross tonnage for steamers, the net tonnage for sailing vessels. T0NNAc;E BELONGINt; TO THE UNITED KINGDOM. (In Thousands of Tons.) f 3.397 Sailing. 1850 (The Date of the Repeal of the Navigation Laws) ' __'^ Steam. I 3,56s Total. Years. Sailing. Steam. Total. Years. 1880 Sailing. Steam. Total. 1869 4.765 948 5,7«3 3.851 2,723 6.574 1870 4,578 I. "3 5.691 l88l 3.688 3,004 6,692 1871 4.374 1,320 5.694 1882 3.622 3.335 6.957 1872 4.213 1.538 5.751 1883 3.514 3.728 7.242 1873 4.091 1. 714 5.805 1884 3.465 3.944 7.409 1874 4,108 1,871 5.979 1885 3.457 3.973 7.430 1875 4,207 1.945 6,152 1890 2,936 5.043 7.979 1876 4,258 2,005 6,263 1895 2,866 6,121 8,987 1877 4,261 2,139 6,400 1900 2,096 7,207 9,303 1878 4.239 2,316 6,555 1902 1.95' 8,104 10,055 1879 4.069 2,511 6,580 Note. — It seems Imjiorlant to notice that while the aggregate of sailing and steam tonnage lias increased, the increase is exclusively in steam tonnage, which is more cfTective than sailing tonnage as three or four to one. 288 FREE TRADE V. FAIR TRADE. Tonnage belonging to Trance. (In Thousands of Tons.) Ships of 2 Tons Years. Sailing. Steam. and Upwards. Total. 1840 653 9 662 1850 674 14 688 i860 928 68 996 1870 918 154 1,072 1879 676 256 932 1880 641 278 9'9 . 1881 602 312 914 1882 567 416 983 1883 537 467 1,004 1884 523 511 1,034 1885 508 492 I,OCO 1S90 44 V 500 944 1895 386 501 887 1900 5'o 528 1,0:8 Over-.Sea Tonnage belonging to the Uniteu States. (In Thousands of Tt)ns. ) Years. Sailing. .Steam. Total. 1S4O 896 4 900 1850 1,541 45 1.586 i860 2,449 97 2,546 1870 1,324 '93 i.5'7 1880 1,206 147 '.353 1881 1,182 '53 '■335 1882 1,137 '55 1,292 1883 •,130 172 1.302 1884 1,120 184 1.304 1885 1,102 186 1.288 1890 749 198 947 «895 s86 252 838 1900 485 34' 826 PART II. — KHTALIATION. 289 Total Trade of the United States cari-icd iv United Stales and Foreii^n Vessels United resj-eetively, luit/i the Percaita\;e earried by caeli [in thousands of dollars).* States Shipping. Years. In American Vessels. In Foreign Vessels. Percentage in .American Vessels. 1840 198,424 40,802 82-9 1850 239,272 90,764 72-5 i860 507,247 255,040 66-5 1870 352,969 638,927 356 1 88 1 268,080 I: 378, 556 163 1882 242,850 1,284,488 159 1 88 J 261,718 1,290,030 i6-6 1884 264,722 1,194,118 i8-i 1885 223,119 1,108,202 i6-8 * From the United Slates statistics. The returns are inclusive of the Lake Trade between the United States and Canad.i. Total Tonnage entered and Cleared in the United States, in eaeh of the years 1850, i860, 1870, 1880, 1881, 18S2, 1883, 1884, 1885, 1S90, 1900, and 1902 {years ended Tpth June), distinguishing Ameriean, British, and other Foreign vessels^ [tn thousands oj tons). Tonnage. Perckntagk. Years ended 30th June. Ameri- can. British. Other Countries. Total. Ameri- can. Briti.sh. Other Countries. Total. Tons. Tons. Tons. Tons. Tons. Per Cent. Per Cent. Per Cent. 1850 5,206 2,845 659 8,710 5977 3267 756 100 i860 12,087 4,068 910 17,065 70-83 23-84 5-33 100 1870 6,993 9,246 2,085 18,324 38-16 50-46 "•38 ICO 1880 6,834 20,697 8,523 36,054 18-95 57-41 2364 100 1881 6,629 21,651 8,509 36,789 1 8 -02 58-85 23-13 TOO 1S82 6,658 20,583 8,116 35.357 18-83 58-22 2295 ICO 1883 6,563 18,828 7.532 32,923 19-93 57-19 22-88 100 1884 6,439 17, '25 6,709 30,273 21-27 56-57 22-l6 100 1885 6,364 17,762 6,694 30,820 20-65 57-63 21-72 ICO 1S90 8,150 20,379 7.727 36,256 22-48 56-21 21-31 100 1900 '2,345 29,812 14,287 56,444 21-87 52-82 25-31 100 1902 •3,783 31,385 •5.931 61,099 22-56 5 1 '37 26 07 100 * From the United States statistics. The returns are inclusive of the Lake Trade between the United Stues and Canada. 290 FREE TRADE V. FAIR TRADE. States Shipping. I)e Tocque- ville's Prophecy. Shipping. Our succcss, it is to be observed, has taken place since Early we rcjiealecl our Navigation Laws, and deprived our ship- promiso of owners of every privilege, whilst we have also given them free access to every market for their materials. In Eurojic we might have expected to remain supreme, but within my own recollection the United States were formidable rivals. When I was a boy American liners were the pride of Liverjiool, and careful observers prophesied that United States shipowners must become the carriers of the world. The following passage from De Tocqueville's " Democracy in America " (vol. 11., chap. 10) is curious enough to deserve quotation : — " From the Bay of Fundy to the Gulf of Mexico the coast of the United States extends for nearly 900 leagues. These shores form a single uninterrupted line ; they are all under the same rule. There is no nation in the world which can offer to commerce ports with greater depth, greater width, and greater safety. . . . Europe is, then, the market of America, as America is the market of Europe ; and maritime trade is as necessary to the inhabitants of the United States, to bring their agricultural produce to our i^orts, as to take our manufactures to them. The Anglo-Americans have at all times shown a decided taste for the sea. Their independence, in breaking the com- mercial links which bound them to England, gave a new and powerful impulse to their maritime genius. Since that time the number of the ships belonging to the Union has increased nearly as fast as the number of its inhabitants. At this day it is the Americans themselves who carry to their homes nine-tenths of the imports from Euroj)e. It is the Americans, too, who caiTy to the consumers of Europe three-quarters of the cx])orts of the New World.* The ships of the United States fill the ports of Havre and Liverpool. One sees but few English or French ships in the port of New York. Thus, not only does the American merchant brave competition on his own soil ; he comi:)etcs successfully with foreigners on theirs. ... I think that nations, like men, almost always show from their youth * In 1884-5, according to the statistics of the United States, about 17 per cent, of the value of thoir trade was carried in United States ships, and 83 per cent, in foreign ships, of wliich more thin two thirds are British. PART II. — RETALIATION. 201 the powerful features of their destiny. When I sec the shipping. spirit with which Anglo-Americans carry on trade, the Present facilities they possess for doing it, the success which they ^'j^'grican attain in it, I cannot help believing that they will one day as com- become the first maritime Power of the globe. They are pared with impelled to take possession of the sea as the Romans were shipping. to conquer the world." Such was De Tocqueville's prophecy in 1835. And now the ships of the United States are not one-fourth, or, if steam is taken into account, not one-seventh of those of England ! And whilst American ships carry less than one-fifth of the whole trade of the United States, British ships carry much more than one-half of that trade. England has 50 per cent, of the ocean tonnage and carrying trade of the entire world, and America is nowhere. If England has special advantages from Nature, other nations have the same. As De Tocqueville truly remarks, in seaports, in harbours, in human skill and industry, and in natural aptitude for the sea, America is not inferior to ourselves ; of coal and iron she has an ample store ; her geographical position is as good as ours. Every port in the world, our own included, is as free to American ships as to ours, whilst the Union closes her trade between her Atlantic and Pacific ports to our ships. But whilst we leave our shipowner to buy his materials and build and buy his ships where and how he pleases, America refuses to ])lace a foreign-built ship upon her register, and im])oses a duty of 40 per cent, on the materials of shipbuilding. At the same time, whilst she thus })rotects her shipowners out of existence, she leaves her capital and energy free to devote themselves to the production of food in her bound- less realms of virgin soil, and the consequence is that, whilst she is developing with extraordinary rapidity those natural resources of soil and climate with which her laws hav^e not directly interfered, she has surrendered to us the field in which Nature allows us to comj^ete, and which, at one time, she seemed destined to win also. We are accustomed to think our railway interest an important interest, and so it is. But in current expenditure on skilled labour our shipping interest is still more import- ant. The fixed cajiital of the railwa\-s is ncarlv 800 202 FREE TRADE 7'. FAIR TRADE. Shippingas compared with Railway Interest. I'roseiit deprcbsion. millions ; the li.xed capital in ships is })robal)ly nut a fourth or fifth of that amount. But the working expenses of the raihva3'S in 1880 were 33 J millions, whilst the outgoings on shipping, which give employment and remuneration to a great variety of forms of skilled labour, probably amount to nearly double that sum. The gross income of the rail- wa3^s in 1880 was 65A millions. What the gross income of shipping was we have no means of estimating exactly ; but it must have been very large indeed, probably much more than that sum. Our shipping interest is one of which the nation may well be proud. The paid-up capital of railways in 1902 was £,\,2l6'^ millions, the gross receipts ;i^i09"5 millions, the working expenses £()T^ millions. The gross earnings of our shipping have been estimated at /^I02 millions, of which about £i2h millions is estimated to be expended abroad in payment for stores and coal, port, canal, and other dues. I have left the above as it was written in 1880. Since then, as everyone knows, shipping has suffered severe de- pression. The great prosperity of the trade do\\ai to the 5'ear 1883 had, as is too often the case, the effect of tempting capital into the trade, and of producing an over-supply. I cannot give the facts better than in the words of Mr. Williamson.* " In 1875 the sailing tonnage of the United Kingdom amounted to . . . . . . . . 4,144,504 tons. The steam tonnage to . . . . 1,943,197 ,, Together 6,087,701 " In 1883 the sailing tonnage was 3,471,172 The steam tonnage had risen to 3,725,229 Together 7,196,401 " But that is only a partial and misleading view of the real state of the case, for, seeing that steam-vessels do three times the work of sailing ships, it would appear that, in eight years, the carrying cajiacity of the mere increase * Article in Furlnij:;htly, of January, 1885. PART II.— RETALIATION. 293 in our steam tonnage since 1875 is more than equal to the Shipping, entire carrying capacity of our mercantile na\-y of sailing Present ships at the present time. The real increase in the capacity depression, for work of our tonnage since 1875 would more accurately be represented by the following figures : — " 1875— Sailing ships 4,144,504 tons. Steam, 1,943,197 tons, multi- plied by 3 to compare with sailing ship tonnage . . 5,829,591 ,, Joint capacity for work. . 9,974,095 ,, " 1883— Saihng ships 3,471,173 „ Steam, 3,725,229 tons, multi- plied by 3 to compare with sailing ship tonnage . . 11,175,687 ,, Joint capacity for work 14,646,860 ,, " 1902— Sailing ships 1,950,655 tons. Steam, 13,263,865 tons, nniltiplied by 3 to compare with sailing ship tonnage ... 39,79l>595 •> Joint capacity for work ... ... ... 41,742,250 ,, The increase in 1902 shows that the additions made to our mer- cantile marine in 1SS3 were not altogether " wild and unjustifiable."' " Such an increase has been altogether wild and un- justifiable, seeing our import and export trade has not grown of late years to any appreciable extent, and that our foreign commerce has for the present lost its former elas- ticity. The member for Birkenhead, who is a shipowner, chooses to pour out his sorrows on the floor of the House of Commons, and entreats Parliament to find a remedy. It would be more becoming that shipowners should seek some secluded spot and shed penitential tears over mis- takes and miscalculations, which it is utterly beyond the power of the House of Commons to remedy. We ship- owners (for I must myself si)eak as an erring member of the body) have seen the enormous yearly increase in our tonnage, and we gave no heed io the lesson till adversity 294 FREE TRADE 7'. FAIR TRADE. has shown us our lolly. As an instance of folly, I may state that one steamshij) company, which has come into existence within the last few years, and which has had to create trades for its vessels, has floated about two miles in consecutive length of steamships within a very short space of time. Not only has ill-advised enterprise of this description been most unprofitable to those concerned, but it has spread dismay among all the other companies with which its necessities have compelled it to enter into com- petition." It may be added that this unhealthy competition has had also the effect of leading persons who had no know- ledge of the business to invest money in it, too often imprudently and incautiously, and has thus been one amongst other causes of the state of things which has led to the present Royal Commission on Unseaworthy Ships, Loss of Life at Sea. In this place it may not be amiss to refer to one infringement of Free Trade principles which had the effect of aggi'avating the evil — viz. the French bounties on shipping, whicli induced an unnatural activity in English shipbuilding yards, for the purpose of supplying French owners with English-built ships, before the period at which Protection to French-built ships should come into complete operation. It need scarcely be added that the depression in question is, of course, fully shared by foreign shipping. Indeed, the pro]:)ortion of British shipping employed in our own carry- ing trade has increased since 1883. The tonnage of ship- ping built, excluding shi])s built for foreigners, has de- creased from 768.576 in 1883 to 497,442 in 1884, and to 405,386 in 1885. A diminution in supply and a continual increase in demand will, no doubt, in course of time remedy the ])resent suffering. Meanwhile we more than hold our own with other nations. In 1902 the total net tonnai^e of sliips built for forcitjn countries was 150,000 tons, and of ships for the home trade Soo.oco tons, in both cases txclusive of war vessels. 2q; CHAPTER XL VI I. SPECIAL INSTANCES OF THE EFFECTS OF FREE TRADE AND OF PROTECTIVE DUTIES ON PRODUCTION — LEATHER, SALT, SILK, CLOCKS, WOOLLENS, STEEL RAILS, COPPER, BISCUITS, WIRE, JUTE. There are one or two special illustrations of the benefit of free tariffs in forwarding production, which it may be worth while to mention specially. Leather. At the recent Leather Exhibition in this country it Leather, appeared that the exportation of boots and shoes from M^n^^^c" this country was largeh^ increasing, whilst the importations tures of, from France and other countries were decreasing, and at the same time the importation of tanned and dressed hides into this country was largely increasing. The following is the statement in the report in the Times of September 27th, 1881 :— " The increase in the number of exhibits this year as compared with last is, roughly speaking, proportional to the improvement which has in the interval taken place in the trade of our boot and shoe manufacturers, the Board of Trade returns for the seven months ending July 31st, this year, showing that we exported 3,277,740 pairs of boots and shoes in that period against 2,800,992 in the corre- si)onding period of 1880, and 3,071,424 in 1879. Our Australian Colonies took 1,309,752 pairs. The imports of boots and shoes, on the contiary, showed a decline. While 1,041,624 pairs were imported from France and other countries in the first seven months of 1879, o"b' 711.4-O ])airs were imported in 1880, and but 572,232 ]iairs in the corresjionding j^eriod this year. " From these figures it is argued that our English manu- facturers are rapidly improving the quality and finish of their goods, and are so enabled to com])ete successfully with Continental makers. Of materials, on the other hand, importations show an increase. In the first seven nu)nths 296 FREE TRADE 7'. 1-AIR TRADE. of 1879 ^^'c imported 21,144,765 pounds weight of tanned and dressed hides ; in 1880 the quantity had risen to 26,516,269 lbs., and in 1881 to 28,686,360 1])S." In 1901 our exports of boots and shoes amounted to 8-4 million pairs, which would give 4*9 million pairs for seven months. The Australian Colonies took i "3 million pairs during that year. The imports have increased .since 1881, amounting in 1901 to 3"6 million pairs, but it is interesting to notice that the imports have not interfered with our own industry, since the quantity imported of hides, the raw material of bootmaking, was 1,110,262 cwts. in 1902, against 1,011,326 cvvts. in 1881. It is also worth notice that the export to Australia of British-made boots and shoes has decreased, this item, at any rate, not bearing out the contention that the United Kingdom's manufacturing existence depends upon the Colonies. It further appeared from the speech of Mr. Jackson, M.P., that we import tanned leather to the value of three millions a j^ear, that much of this leather comes from America, and that live cattle come here from America, that they are killed here, that their skins are sent back to America to be tanned, and that they are then sent back here to be used in manufacture. The reason, as I am informed, is not that we do not tan hides as well as the Americans ; but that they, adopting newer and rougher methods, do the first ])art of the jn'ocess more quickly and cheaply than we do, so that it is worth while to commence tanning in America, and then send back the hides to be completely tanned, and then used, in England. If so, it is a remarkable instance of modern division of labour, and of the advantage of free, cheap, and speedy communication. The value of hides exported from the United Kingdom to the United States fell from £1 million in 189S to ^464,000 in 1902, thus seeming to indicate that we are tanning more of our own leather. In 1902 we imported _^3,S6o,ooo worth of dressed leather. While in 1882 we exported 634,000 doz. pairs of boots and shoes, in 1902 we exported 789,000 doz. pairs. In 1902 we imported 244,000 doz. pairs, as against 130,000 doz. pairs in 18S8, the first year in which liootsand shoes are given as a separate item in the Statistical Abstract. From these figures, it is clear that our increased imports of leather and of boots and shoes are not interfering with home industry, but that they enable our own people to be belter shod, while our manu- facturers are semling increased supjilies tn the foreigner. PART II — RETALIATION. 297 It would, no doubt, save labour and expense if we could do the whole of the process of tanning as cheaply as the Americans, and it is to be hoped w'e ma}' learn to do so. But our present system gives us both the finer process of tanning and the manufacture for export as well as for home consumption of cheap boots and shoes ; whereas, if we imposed a tax on tanned hides for the supposed benefit of our tanners, we should probably destroy all prospect of improvement in our own tanning, and we should still more ])rol)ably ruin our manufacture of boots and shoes, and divert it to our foreign rivals. In turning to the returns, in which attempts have been made to discriminate between raw materials and manu- factures, I find tanned hides inserted among manufactures. And in turning to the tariffs of foreign countries, I find that tanned leather is subject to a duty in France, German}', Russia, Denmark, Sweden, Norway, Austria, Italy, and the United States. They would become more formidable competitors if they would give to their skilful and in- genious workers in leather the benefit of untaxed hides ; Init this they dare not do, for fear of their agriculturists. From the most recent reports, it appears that this branch of English trade continues to be prosperous. The exjiorts of manufactured leather grew very largely until iiS82, and have since remained large. The imports of raw materials, in the shape of hides, continue to increase ; and though the exports of boots, shoes, and other manufactured articles were not quite so large in 1884 as in some previous years, they maintained a high figure, and appear, by the most recent returns, to be on the increase. The value of manufactured leather of British and Irish production increased from /2"3 millions in 1884 to £2'^ millions in 1902. Scllf. Take, again, salt. Salt enters largely into manufacture. It is a chief material of alkali, and alkali of glass. France im])oses a heavy duty on salt. In this country it is free and cheap. We export a large and increasing quantity of alkali (nearly 7,000,000 cwts. in quantity, and £2,400,000 ill value, in 1880 ; and about the same in quantity, though l 5fS'7 633-0 267-5 340-7 23^'2 292-3 136 ,38 189; 1900 1902 775 '4 559"o 643 '3 4 44 '9 196-2 285-4 370-5 362-8 357*9 '35 141 136 Year. liritish and Irish Wool Exported. Million lbs. Exports of Woollen Manufactures. Population. Consumption of Wool per head of Population. Million £. .Millions. lbs. 1885 23"5 i8-8 3'>-3 lO'I I 90 I9"5 i8-4 37 '5 "■4 1895 217 '97 39-2 13-0 190. 24 9 15 7 41-2 12-2 1902 37'2 15-3 42-0 M-8 From the abo\c it is clear that far more wool both absolutely and per head of the population was manufactured in 1902 than was the case in 1885, and since the exports were less in value by ;i{^3, 000,000 in the lat'er year, it is also clear that the people of the United Kingdom are better able than they were then to afford the purchase of woollen clothing and other goods. If the official statistics gave the weight as well as the value of woollen manufactures imported ami exported by all the leading countries, it would be possible to calculate with some exactness the increase or decline in the use of woollen goods by their respective peoples. As it is, the figures show that indubitably more wool per head was actually useil in the I'nited r 3o6 FREE TRADE V. FAIR TRADE. Specia illustra- tions. Woollen goods. KinLjdom in the last ten years than in the ten years preceding them ; while they also suggest that in Germany population and the export of woollen goods are increasing at a greater rate than the production of home-grown wool and the import of foreign wool and foreign manufactures, and that, therefore, the German people have less wool left for their own use than was formerly the case. Taking, for instance, the years 1892 and 1S97, for which the number of sheep in Germany was given in the " Foreign Abstract," published by the Board of Trade, and estimating the clip by multiplying the number of sheep by 4 '5 — 4*5 lbs. being taken by the Board of Trade as the average weight of a fleece in the United Kingdom — we have data for the following table : — Domestic clip. CONSIMPTION OF WoOL IN GekMANV. Retained for 1892 Raw Wool Imported. Million lbs. Million lbs. 6" 333 49 336 Raw Wool Exported. Million lbs. 23 Consumption. Million lbs. 377 362 Population, ^-^iiy;^" Million. 50 'o 53'i lbs. 7-6 6-8 The domestic production of wool for these years may have been more or less than here estimated, but the basis of calculation is the same for both years, and it therefore follows that the amount of wool per head used in German manufactures was less in the latter than in the former, and was in both years very much below the corresponding figures for the United Kingdom. And it seems that the amount per head of wool used by the German people had decreased, even more than the amount per head manufactured in the country, for in 1892 the export of woollen yarns, cloth stulTs, and wearing a)iparel exceeded the imports by i6"7 million kilogrammes, while in 1S97 the excess had risen to 18 million kilogrammes. Steel Rails. Take, again, the case of steel rails. The following is an extract from the same authority as I have quoted above : — * " During the great demand for railroad materials which began on the revival of business in 1879, and continued for several years thereafter, the i)ricesof steel rails were advanced so high that English rails were imi)ortod into the United States even though i)aying the duty of one hundred per cent. During this time the price in England was on the average. * Taussig's "History of the rniteil States TarifT," p. 69. PART II. — RETALIATION. 3O7 in 1880, about 36 dols. per ton, and in 1881 al^out 31 dols. Special il- per ton. In the United States, during the same years, the lustrations- price averaged 67 dols. and 61 dols. per ton. That is, ^'^^' '^'^^• consumers in the United States were compelled to pay twice as much for steel rails as they paid in England. Anything which increases the cost of railroad building tends to increase the cost of transportation, and a tax of this kind eventually comes out of the pockets of the people in the shape of higher railroad charges for carrying freight and passengers. The domestic producers of steel rails secured enormous profits of one hundred per cent, and more on their capital during these years. These profits, as is always the case, caused a great extension of pro- duction. The men who had made so much money out of Bessemer steel in 1879-1881 put this money very largely into establishments for making more steel. New works were erected in all parts of the country. At the same time the demand fell off in consequence of the check to railroad building, and the increased supply, joined to the small demand, caused i)rices here to fall almost to the English rates. But during the years of speculation and railroad * building the tariff had yielded great gains to makers of steel rails, and popular feeling against this state of things was so strong that in 1883 Congress felt compelled to make a considerable reduction in the duty* — a reduction, however, which has no practical effect, because the un- natural increase in production in the United States, owing to the Protective duty, and the subsequent decrease in demand, have lowered the price of steel rails in the United States so much that the reduced duty is still prohibitory." The following table shows that the ])eo])le of the United States have had to pay to their steel rail manufacturers prices varying from 30 to 50 per cent, more than has been paid in England. In the earlier years cost of production was much higher in America than in England. There is now little difference, but the tarilY is used to save prices at home and meet the loss of scUint;- under cost abroad. * Taussig's " Ilistuiy of tin.' United Stales 'I'anirt," cliap. iii., pp. Ou, 70. 3o8 FREE TRADE 7'. FAIR TRADE. ProJiuts, /ill ports, an J Foreign and Poiiieersons ; • For details see Prodine Markets A'tTi'nf, I5tli Marcli, 1884. It gives employ- ment. It is also raw material 320 FREE TRADE FAIR TRADE. These re- sults ob- tained by free im- portation. Taxation on .Sugar. Drawback on Ex- portation. and the returns of this manufacture in Scotland show not much less. More than loo.ooo tons are employed in the United Kingdom in this business alone, and more than 12,000 hands, which is more than twice the number of hands employed in sugar refining. This, it is to be remem- bered, is a manufacture which suj^i^lies a cheap and whole- some luxury to the poor, and which calls into existence other industries, such as fruit-gi"owing, which are them- selves of great importance to the country. Other industries, such as the making of biscuits, with which we supply the world, and of mineral waters, brewing, and cattle-feeding, also depend largely on sugar. Cheap and good sugar is a very important raw material.* The importance to the nation of our cheap and plentiful supply of sugar it is therefore difftcult to exaggerate. How have we managed to obtain it ? The answer is very simj^le — viz. by opening our ports and receiving freely what our neighbours have offered us. But as our Protectionist friends wish us to reverse this policy, it is worth while to consider the point a little more carefully. As before mentioned, the policy has been revoked by the United Kingdom becoming a signatory to the Sugar Convtntion. Sugar, considered as an article of general consumption, and also, though the word is misleading, as an article of luxury, has been a favourite object of taxation ; the more so, perhaps, because originally it was an article produced in foreign and distant countries. But even then much of it was refined in Europe, and this raised a difiticult}'. It has always been the practice where any article has paid duty, and has undergone a process of manufacture, to give back the duty on its being re-exported, under the name of " drawback." When the article exported can be recog- nised as the same article which has paid duty, this is a simple thing to do. But when the article has undergone a change since it paid duty, a calculation is necessary in order that the amount actually jiaid, no more and no less, may be restored as drawback. Thus an im])ort duty was paid on raw sugar ; it was rehncd in the country of import ; * See I'rodiice Markets A'li'ii-.c, a'ltli July, iSS.). I'.irl. Paper 325, 1884, p. 11, and Appendix thereto. PART II. — RETALIATION. 321 and some of the refined sugar was re-exported. It became then a problem for the Governments of Europe to dis- cover what was the relation of a given quantity of refined sugar to the raw sugar from which it was made, so as to determine what was the amount of duty to be repaid. This proved to be a very difficult problem, and the difficulty was much increased when European nations began to make sugar from beet, and when the problem was to determine not only the relation of raw sugar to refined sugar, but the relation of sugar, raw or refined, to the original material of which it was made. The Governments were in a dilemma. If they gave as drawback on the manufactured article less than had been paid on the raw material, they were burdening their manufacturers with a tax which dis- couraged exportation. If they gave more, they were giving a bounty on exportation, and were thus artificially raising the price to their own citizens, and lowering it to foreigners, by means of money drawn from the pockets of their owti taxpayers. Beset by these embarrassments, the Governments of Europe, our own among the rest, floundered on for years. By conference after conference, by measure after measure, they endeavoured to hit the right mean ; and, generally speaking, the special trade, as is usual in such cases, got the better of the public, and secured to itself some bounty in the way of drawback. This was the state of things in 1863, and in this country a gi"aduated scale of duties and drawbacks was established and sanctioned by International Convention in 1864. At last, after the duties had been twice halved by successive Governments, they were wholly abolished in 1874. They were re-establislied in .\pril, 1901, at the rate of 4';. 2d. per cwt. for refined sugar, and from 2s. to 4s. 2d. per cvvt. for unrefined, according to the degree of polarisation. The results are as follow : — The consumption of the country was 473,000 tons in 1863 ; it was 1,083,000 tons in 1883. The exports had doubled also. The average cost of sugar to the grocers was 41s. per cwt. in 1863 ; it was 23s. 3d. in 1883. This reduction consisted of the duty, which was 12s. 6d., and in addition of 5s. iJd., or more than ^d. a lb. saved by increased demand and improved supply.* * From tlie Produce Markets Review, 15th March, 1884. V Sugar Uifficuhies of Euro- pean Govern- ments. Reduction and final repeal in England of sugar du- ties. 322 FREE TRADE V. FAIR TRADE. According to the official statistics, we paid for sugar imported, including duty, i8h millions in 1863, whilst in 1883 we paid about 25 millions, and in 1884 we paid about 20 millions for twice the quantit3'. Sir Stafford Northcote removed a very troublesome tax, which brought into the revenue less than 6.\ millions in 1863, and only about 3J millions in 1-873, and in so doing he has saved the country from 12 to 17 millions in the price of sugar, as imjiorted, and much more on sugar as retailed ; and he has vastly increased and improved the food of the people, besides encouraging many native industries. In 1900, when sugar was free, the amount consumed was 32 million cwt., valued at /i8'6 millions, or lis. yd. per cwt., the retail price averaging i"5d. per lb.; the consumption 87"i8 lus. per head of population. In 1902 the consumption was 31 '5 million cwt., valued, free of duty, at £i4'S millions, or 9s. id. per cwt., and the retail price averaged i"5d. per lb. ; the consumption 8j'95 lbs. per head. The diflerence in the import price being 2s. 6d. per cwt., or over ^d. per lb., had it not been for the duty, sugar in the latter year would have cost less to the consumer, whereas the retail price for both years was the same. The duty brought in ;^2, 121,000 to the Government, and at the same time raised the price of sugar to the public by 2s. 6d. per cwt., or over ;^j,93i,coo in the total consumption, thus placing a burden on the people greater by ^i'8 million than the value received by the Treasury. From this it is clear that duties increase prices even when a fall in the open market, causing the retail price to remain as it was, has a tendency to conceal the fact. Had not the consumption per head of sugar fallen off, the disparity between the gain to the Revenue and the loss to the public occasioned by the sugar duties would have been even more glaring. Not only has the price been thus enormously reduced, but the quality has been enormously imi^roved. Good white sugar may now be found in every cottage.* Other nations have not been wise or rich enough to follow the same course ; they all levy a considerable duty on sugar ; most of them make these duties differential in favour of their own manufacturers or colonists ; and many of them have so arranged their drawbacks as to give their own manufacturers or refiners a bounty on exported sugar. * See I^ reduce Markets Kcvirw, 6th of Marcli, 1886. PART II.- -RETALIATION. 323 To give the history of these duties, " surtaxes," and Sugar, bounties, or drawbacks, in detail, would be impossible, and they may be found in the various Parliamentary Papers.* But the following few facts are worth notice. Germany imposes a tax of 12 marks per centner (about ^erman a cwt.) on raw sugar imported. f She also imposes a tax Drawback. on the beet used in manufactures, estimated to be equal to 10 marks per centner on the manufactured raw sugar ; and a drawback, formerly of 9-40 marks, but now of 9 marks, is repaid on each centner of exported raw sugar. But by improvements in the growth of beet, and in the process of manufacture, much more sugar is produced from the given quantity of beet than the quantity it was estimated to produce, and the manufacturer, consequently, on exporting sugar, receives upon the excess a drawback or bounty which he has never paid as duty on the beet. What the amount of this bounty may be it is impossible to say with accuracy, for it varies with the skill and success of the grower and manufacturer. The average bounty has been variously estimated — from one shilling, or less, per cwt., to two or three times that amount ; but the recent German Committee estimated the maximum at 1-40 marks per centner, or about is. 5d. per cwt. Under this system the German production has increased five-fold since 1871, and was, in 1883, 835,164,600 kilos. Of this, three-fifths were exported and two-fifths only consumed in the country. Of the total exports, amounting to 472,551,400 kilos., be- tween three-fifths and four-fifths were exported to Great Britain. Iii 1885 our imports from Germany were 7,332,000 cwts. of raw, and 974,000 cwts. of refined sugar, or about a million cwts. more than in 1883, vvhilst the value was less by more than £1,600,000 — a transaction which must have been very far from profitable to Germany, whatever it may have been to us. In the present year the import of raw sugar from Germany is decreasing largely, and that of refined sugar increasing. The Government ha\-o. in paying this bounty, lost what is estimated to amount to * See especially N'os. 317 and 422 of 1881, 325 of 1884, and 39 01 1885, and c. 4715, i., of 1886, p. 199. t Pari. Paper 39. December, 1884, p. 37, Report, bv Mr. Scott, H.M. Secretary of Legation at Berlin, on German Bounties. 324 FREE TRADE 7'. FAIR TRADE. upwards of a million sterling of revenue which they would have received if the drawback had been equivalent, and not more than equivalent, to the duty. The German Government, alive to the loss, appointed a Committee of experts to inquire into the subject, who found that the drawback was too large, and recommended a reduction ; and a Bill was introduced for this purpose, but has not been pressed, owing to the prevalent distress among Ger- man beet-growers and sugar manufacturers. The effect of this system is very curious. That the Germans, as tax- payers, lose, is clear ; the Germans, as sugar consumers, do not gain, for the wholesale German price is regulated by the English market, and is exactly what the English- man pays, with the whole drawback added. Where the English wholesale purchaser pa3^s 12 marks per cwt. the German pays 21, an addition which is probably doubled before the sugar reaches the actual consumer ; and we have already seen how comparatively dear and poor is his supply. But mark the further result : the German beet-grower and sugar manufacturer, who probably gained much at first, is now at least as much distressed as our own refiners. Mr. Scott tells us that present prices admit of no profit ; and that many manufacturers are working at a loss in hopes of a rise. The critical position of many of the German factories is notorious ; but the best evidence of the distress is that the frugal German Government, though really anxious to abolish bounties, dare not at this moment pro- ceed with the measure which their experts have recom- mended. In fact, there has been a glut in the sugar trade, much aggravated by the foolish system of bounties, and whilst English consumers have benefited by the low price, none have, in the end, suffered more than the class of agriculturists and manufacturers whom it seemed prima facie to benefit. It should be added that the German exports of refined sugar did not until lately inciease in the same proportion as those of raw sugar. In 1882 they were 17-6 per cent, of the total exports of sugar, in 1883 only 14-8 per cent., and in 1884 they were 17*9 per cent. Her refiners, Mr. Scott's report tells us, cannot compete successfully with our own,* ' * Pari. Paper 39 of 1885, pp. 43, 44. PART II. — RETALIATION, 325 In the last year the import of refined sugar has Sugar, increased. In later years the increase continued. The bounties enabled German exporters to sell refined sugar much cheaper to us than in their own maiket, refined sugar in 1884 constituting I7"9 per cent, of the whole amount exported from Germany, and 44 per cent, in 1900. Of our sugar imports from Germany in 1886, raw sugar constituted 43 per cent, and refined siigar 57 per cent. ; and in 1902 327 per cent, and 67"3 per cent, respectively. Of our total imports of sugar in 1886 717 per cent, was raw, and in 1902 41 "8 per cent. The amount of law sugar imported in 1886 was 16 million cwt., and in 1902 13 million cwt. ; the imports of refined sugar for the same years were 6 million cwt. and 18 million cwt. Thus, though the foreign sugar bounties have helped to deprive our sugar refiners of 3 million cwt, of raw material to work upon, they have helped to give 12 million cwt. of refined sugar as food for our people or raw material for our manufacturers of jams, biscuits, and confectionery — an exchange which, on the whole, has greatly benefited the majority. Proposals have been laid before the German Legislature proposals for altering this system, and a Committee of the Reichstag for aitera- has accepted a proposal by which the bounty would be ^'°"''' reduced by rather more than one-half. In the course of the discussion on these proposals, Deputy Gehlert (who is said to be a strong Protectionist) made the following state- ments, which may be quoted as a remarkable criticism on the system of bounties : — " The sugar industry is quite forty years old. Until Deputy about 1875 it slowly but surely developed through its own Gehiert's natural strength, and was till then one of the most valuable ^p*^^*^^- elements of our national production. Since that time it has been subsidised by the State at a cost of £7,500,000, and has, solely in consequence of this stimulus, attained its present dimensions. If size and soundness be equivalent things, then the condition of the sugar industry has be- come extiaordinarily sound in the past ten years. Some £20,000,000 to £25,000,000 have been sunk in building factories, which employ 50,000 workmen. But, gentlemen, in the year of the sugar crisis the State subsidy amounted to fully £2,000,000. Reckoned in one way, this subsidy was ecjuivalent to a dividend of 8 to 10 per cent, on the capital invested in building the factories ; reckoned in 326 FREE TRADE V. FAIR TRADE. another way, the State j^aid the whole of the wages of these 50,000 workmen, who would surely not receive more than £2,000,000 in wages. Gentlemen, would not any industry, textile or other, under similar conditions have expanded to a similar extent ? And yet there followed the great sugar bankruptcies, and heavy losses on unrealisable property both to the State Treasury and to private individuals ; there were thousands of workmen thrown on the streets — as to whose fate the speculative clement in the industry pays little heed ; there were accumulated stocks and miseiably low prices ; in short, there was the crisis which still lasts, and which has assumed a yet broader basis. When j)eople say, ' Oh, but we have exported such-and- such a quantity,' is that the question in point ? The real question is whether this export has been done at a profit or at a loss, and if at the latter, since when has it been held that the heaviness of the weight sold is a desirable element in loss ? Would to God that not a })ound of sugar had been exported from Germany if the result has been a loss ! People say again, ' But £20,000,000 to £25,000,000 have been invested in sugar factories.' Good heavens ! what are these £20,000,000 to £25,000,000 worth to-day ? What would the shares in these factories fetch on 'Change ? Or the increased value of the sugar estates is adduced ; but how does their actual value compare with their values on paper to-day when the subsidy is still being given ? If these last fictitious assets were taken at their real value, and if the patient State Treasury were to be quite closed, what would remain of the ' brilliantly developed sugar industry,' of the ' industry which on the whole appears in a highly satisfactory state,' etc., etc. ? No, I cannot discern the smallest gain to our countrj^, nor any reason to maintain the present state of things. The profits of this system have only been reaped by England. It is German cai)ital that has enabled England to give sugar to her cattle ; it is German capital that has so developed the English manufacture of sweets that it successfully com})etes with the German manufacture in the markets of the world, and in Germany itself. With the sugar exported to England, a part of the German consumption was exported. We pay one and a half to two millions sterling to enable England PART II.— RETALIATION. 327 to consume what would properly be worked up by our Sugar. German industry. Gentlemen, I fear that this system has made us the laughing stock of our English cousins." Austro-Hungary levies her duties on an estimate of the Austro- quantity of sugar contained in the vessels used in manu- ^""sary. facture. A few years since, this estimate was so much too large as to give a large bounty on exportation, and Austria led the way in the race of ruin. She has since revised hei estimate, and has fallen far behind Germany in exports. But not the less have her manufactures felt the recent glut and the reaction from the unnatural stimulus ; and bank- ruptcies and failures among Austrian sugar-makers were notorious during 1884-85. France revised her system some years since, with the France. view of putting an end to bounties, and, though her pro- duction has increased rapidly, her exports have diminished. Frightened by the progress of Germany, and by the distress of her beet-growers and sugar-makers, France revised her sugar taxation in 1884. She raised her duty on home- grown sugar ; she increased the differential duties on foreign sugars ; she adopted the system of taxing beet as the raw material ; and purposely gave a heavy drawback on ex- port, which has been estimated at twice the amount of the German bounty.* It is too early to say what the actual result is, but it may be confidently predicted that her measures will, if they have the effect contemplated, throw an additional burden on her exhausted exchequer, and raise the price of sugar to her own consumers and manu- facturers. At present it seems that our imports from France are not on the increase. She is beaten in our markets by Germany and America. f In 1886 we imported from France 103,000 tons and in 1902 199,000 tons. Belgium, which has largely increased her exportation in Belgium, late years, has been also perplexed by the distress of her • Produce Markets A'l" tew, 20lh Feb., 1886. f According to the latest returns it would seem that the heavy rate of draw- back is beginning to make itself felt, a large increase having taken place in our imports from lYance. It has been estimated (see Produce Markets Revieiv for 6th and 13111 November, 1886) that the average bounty is about 8s. percwt., and that it will involve a loss to the French Treasury of front ^^"3,000, 000 to /,'4, 000,000 a yeixr. 328 FREE TRADE V. FAIR TRADE. sugar interest, and, after an inquiry into her mode of taxa- tion, has proposed a new law. She disapproves of bounties, and will not extend them ; nor will she substitute for her present system of taxing the juice expressed from beet, the German plan of taxing the root itself. But she is imposing an increased differential duty on foreign sugar. It deserves notice that the Belgian makers of jams, confectioner}^ and biscuits, whose English rivals have, as we have seen, pro- fited so largely by the cheap sugar of England, have peti- tioned their Government, but in vain, for a drawback on exportation of the taxed sugar they use in their manufacture. Holland, which taxes her sugar by a process of sac- charimetry, or chemical measurement of the quantity of sugar contained in the juice, has recently revised her method. She is said to give a considerable bounty, and has largely increased her exports. Russia has also joined in the fatal race of bounties, and has, perhaps, committed a more glaring folly than an}' other country.* In 1884-85 her production exceeded her consumption, and the Russian sugar producers succeeded in getting from their impoverished public exchequer a direct and express bounty on all sugar exported within a given time, which has now expired. The result was an importation into this country which amounted to 200,000 cwts. per month in the course of last winter. What wonder that, with a Government capable of such inter- ference with trade, the sugar producers should actually have asked for a law to limit sugar production in future years ? It is right to add that the Russian Government look on their policy as temporary, and treat the bounty as a loan to be repaid by the sugar interest at some future time. Nor are European countries alone in giving artificial Protection to sugar. The case of the United States may be specially mentioned. They use more sugar than any other nation except ourselves. Their sugar bill is about equal to theii wheat bill. But in order to protect a domestic industry which does not produce a fraction of the amount consumed in the country, and which languishes in spite of Protection, they impose a duty on foreign sugars of 60 i)er cent., whilst as regards refined sugars their system * ('. 4715, i., of 1886, p. 289. PART II. — RETALIATION. 329 — like those of European countries — is said to give a draw- Sugar, back on exportation. The consequence is that their con- sumers contribute about £14,500,000 a 3'ear in order to maintain a languishing industry, and each American pays for each pound of sugar twice as much as the Englishman pays.* At the same time, if it is true that they give a drawback, they bribe their refiners to export. At any rate, it appears to be a fact that the imports of refined sugar from the United States have grown from 125,596 cwts. in 1883 to nearly 2,300,000 cwts. in 1885 ; and this appears to have been done with little, if any, profit to the parties concerned. In 1900, the last year of free sugar in England, the price was stil half that ruling in America, the retail price being rfd. in London and 3d. in Pennsylvania. In 1902, when we had made sugar dutiable, the difference in price was still great, but not so marked — in London i^d., in Pennsylvania 2 8d. In that year we imported 112 cwts. of refined sugar from the United States. An inquiry has been directed by the United States Government into the question of drawback, but nothing has yet resulted from it.t Brazil guarantees a high rate of interest on the capital Brazil, employed in sugar-making, with the result that at present prices ruin is impending over her sugar factories.! The Legislature of one of our most flourishing Colonies New — New Zealand — has recently passed an Act granting a professed bounty of one halfpenny per pound on the first thousand tons of beet-root or sorghum sugar produced in the Colony, besides providing that no Excise duty on sugar shall be levied so long as the existing import duty of one halfpenny per pound continues in force ; and that if that duty be at any time increased, the Excise duty leviable shall always be one halfpenny per pound less. Further, should the import duty be reduced, a sum per pound pro- duced equal to the amount of the reduction is to be paid * Dradstreefs. i6th Jan., 1886. C. 4715, i., of 1886, p. 384. t Since the above was written the rate of drawback has been provisionally reduced by about is. per cwt. pending further inquiry, and it is e.\pcctcd that the exports of refined suyar from the United Slates will shortly show a con- siderable decrease in conseciuencc of this measure. J Pari. Paper 30, of 1884, i^. 29. Zealand. 330 FREE TRADE V. FAIR TRADE. to home producers who may be tempted, b\' this Act, to embark in the industry. Beetroot sugar is not now produced in New Zealand, and the bounties have been abolished. For further details upon the action of Foreign Govern- ments in the matter of sugar, I must refer to the Pariia- mentary Papers, 325 (1884) and 39 (1885). One or two points are clear from what I have stated. Foreign Govern- ments are all floundering in the difficulties from which we, by abandoning all taxation of sugar, have happily emerged. Most of them have imposed intentionally Protective duties on foreign sugars ; many give bounties on export ; which, however, except in the case of France and Russia, are un- intentional. All of them raise the price of sugar to their own consumers ; and those which give bounties cheapen it to foreigners. Above all, in all these countries, however much manufacture and export may have increased, there is gi-eat distress among the protected classes. Protection and bounties have i)roduced their usual results — viz. an unnatural stimulus, and large immediate profits, followed by a glut, collapse, and ruin. One other point deserves notice. If there are any European countries of whose bounty-fed competition our sugar refiners and West Indian interests have complained, they are Germany, Holland, and Belgium. It is these countries, if any, which have displaced the labour of the English workman. We have already seen, in the account above given of the trades set in actiou by our increased sugar supply, how absurd this assertion is. But theie is another answer, and, if not a mere coincidence, it is a curious illustration of the Free Trade maxim, " Take care of the imports, and the exports will cake care of themselves." Our imports of sugar from German}-, Holland, and Bel- gium have been as follows : — Value. I Value. 1880 /■y, 264,000 1883 10,412,000 1881 8,369,000 1884 7,829,000 1882 7.295,000 I 1885 7,378,000 Showing an increase of about three millions in 1883, the year in which the value of sugar im])orted from these countries was at its highest point, over 1880. Our total PART II. — RETALIATION. 331 exports of British and Irish produce to these countries Sugar. have been as follows : — Value. Value. 1880 ... ... ;^3f, 986,000 1883 ... ••• ^^36,622,000 I88I ... 33,406,000 1884 ... 37,468,000 1882 ... 35,978,000 1885 ... 33,100,000 Showing an increase of about four millions and a half, com- paring 1883 with 1880 as before. Thus the increased import of sugar in 1883 had been more than balanced by a ])roportionate export of our own manufactures, which must have given employment to an increased number of our own workmen employed on those manufactures. In 1902 our imports of sugar from these countries had increased since 1885 to ;^i 1,139,000, and our exports to them of British and Irish produce had increased to 39'7 millions. Sugar formed between one-eighth and one-ninth of our total imports from these countries, and the increase in the imports between 1S85 and 1902 was ^^31 "9 millions, of which ir8 per cent, was accounted for by the increase in sugar. We are '^^T^'"'' Indian planters. So far as we have gone, there is certainly nothing in the importuni present state of the sugar trade which should make us ties of sugar desn-e to imitate the systems of other nations nevertheless asked to do so by two very importunate in- terests — viz., the sugar refiners of this country and the English owners of West India sugar estates. Their cases are inconsistent, for it is the interest of the refiners to have chea]') raw sugar, and it is the interest of the West India planters that raw sugar should be dear. But they unite in urging Retaliation against foreign sugar bounties. Let us see hrst what their wrongs are, and then what are their proposed remedies. First, as to the refiners. It is alleged that the foreign Refiners' liounties are destroying this important trade ; and agitators '^'^^^'• circulate the preposterous assertion that the British work- man is thus deprived of 15 millions annually in wages. Now what are the facts ? It was showni in 1881* that since 1864 tlic refining trade of this country liad lost about 50,000 tons of loaf sugar ; but liad gained 30,000 tons of other sorts of hard sugar, and 300,000 tons of moist sugar. | * Pari. Papers 317 and 422, of 1884. t Pari. Paper 325, of 1884. 332 FREE TRADE V. FAIR TRADE, Sugar. The quantity of sugar refined at home inereased between 1880 and 1883 h"om 653,000 tons to 816,000 tons ; and the numl:)er of men employed in it also inci^eased considerably. The importation of foreign refined sugar did not increase between 1877 and 1883, being 171,000 tons in 1877, 152,000 tons in 1880, and 164,000 tons in 1883 ; in 1884 it was 213,000 tons, and in 1885, 261,000 tons. The exports of refined sugar from the United Kingdom have increased, being 56,000 tons in 1877, 48,000 tons in 1880, 58,000 tons in 1883, and 65,000 tons in 1884. These are not figures of a declining trade. Since 1884, however, there is reason to believe that our refiners have been hard hit by the con- tinuance of the German bounties, the new Russian bounties, and the import of refined sugar from America, encouraged by low Atlantic freights and probably also by a system of bounties. The net imports of refined sugar have increased to 256,000 tons in 1885, and are 172,000 tons for the first seven months of 1886 ; whilst the exports of refined sugar were 49,700 tons in 1885, and are 22,400 tons for the first seven months of 1886. The sugar refining industiy, as shown on page 325, has suffered a further decline since 1886, and, as also shown, there has been more than compensating increased employment for capital and labour in the industries which benefit by a supply of cheap refined sugar. It is imi)ossible under such circumstances to withhold sympathy from our sugar refiners. They are fostered by no Protective duty ; they are stimulated by no bounty. They are the innocent victims of a glut, caused to a great extent by the foolish policy of other countries. It is a small consolation to them to reflect that the j^ctted pro- ducers of those countries are suffering from this policy as much as themselves. But, after all, sugar-re lining in this country is at the best a comi)aratively small trade, and the ca})ital employed in it does not probably attain ^^3, 000,000. It is, whether as regards capital or workmen employed, a trade of far less imjwrtancc than the subsidiary trades mentioned a])Ove which cheap refined sugar has called into existence, and for some of which foreign refined PART II. — RETALIATION. 333 sugar has special advantages. Looking to the interest of the workman considered as a producer only, and putting aside his still more important interest as a consumer of sugar, it would be simple madness to exclude foreign refined sugar in the supposed interest of British refiners. The case of the West India sugar planters is one de- serving of even more sympathy. They have no doubt been deprived, by the competition of beet-sugar, of the i:)roportion of the market of the United Kingdom which without such competition they might have expected to enjoy, and some part of this competition is no doubt due to foreign bounties. But their statements are grossly ex- aggerated. It is alleged, for instance, that the increase of beet sugar is entirely due to the bounty system. This is contrary to the evidence which has been taken abroad, and which shows that the growth of beet is largely due to agricultural improvement in France and Germany, as well as to energy and skill in manufacture, and that it is in- timately connected with improvements in the growth and feeding of cattle. It is, moreover, inconsistent with existing facts, as shown by the official statistics. Only a part of the beet sugar produced is bounty-fed. In some countries — e.g. in France — there has in late years been no bounty, and yet the production increases rapidly. It is only on the sugar exported that a bounty can possibly be paid, and this is only 700,000 tons out of a total of beet sugar pro- duction of about 2,000,000 tons. Another allegation is that bounty-fed sugar will, when it has driven all other sugar out of the market, become a virtual monopoly, that it will then rise in price, and that consumers will accordingly then suffer all the inconveni- ences of a restricted market. The allegation scarcely needs refutation. Much of the supply of beet sugar, as shown above, is not bounty fed ; and cane sugar, as shown below, is not being driven out of the market. Moreover, with such diversified area of production as I have shown to exist, there is jirobably no article in the world, not even wheat, in which it would be equally impossible to create any kind of monopoly or to raise prices undulv. Another allegation is that cane sugar is being sup- planted by beet — an allegation utterly untrue. British Sugar Case of West Indian planters. Causes of growth of beet sugar. Restriction of the market impossible. 334 FREE TRADE V. FAIR TRADE. Sugar. cane sugar has increased from 261,000 tons per annum in Is cane 1853-5, to 419.000 tons in 1880-2, and in the same time ^r"^-Th fo^'^^B'^"^ C'^^s sugar has increased h-om 972,000 to 1,500,000 beet?' ^ tons, though beet sugar has increased in a much larger proportion. British cane sugar has ever since 1868 main- tained its proportion of the total supply of sugar — viz. 12 per cent. Comparing 1877-9 with 1880-2, the increase of West India sugar has been from 210,000 to 230,000 tons annually. The proportion of cane sugar imported into the United Kingdom has largely declined, and the actual amount of British cane sugar so imported has somewhat decreased ; but the increased supply of that sugar has been diverted to North American and Australian markets. Nor is there any reason to despair of the future of cane sugar. Skill and industry have done their utmost in growth and manufacture of beet, whilst much remains to be done to extract completely the much larger quantity of sugar contained in the cane. This, at least, is the opinion of many experienced ))ersons, and among them of Mr. Baden Powell, and of Mr. Newton, President of the Cham- ber of Agriculture in the Mauritius, a colony second only to the West Indies in the production of cane sugar. In a remarkable paper, which has been laid before Parliament, he exhorts his countrymen, who, in common with- other sugar producers, are suffering from present low prices, to abandon all hope of Protective remedies, and to trust cheerfully to improved production.* The case and prospects of the West India planters arc therefore not so bad as has been stated ; not worse, prob- ably, at the present moment, than those of protected sugar producers in foreign countries. There has been a general glut, and they, in common with others, have suffered. If they can retain their share of the North American market, and if, above all, as much skill and energy can be put into their manufacture as is put into the manufacture of beet sugar by France and Germany, there is no reason why they should not have a i)rosperous future. But the case of the West Indian planters is open to one or two further observations. It would be a mistake — at any rate as regards Jamaica * Pari. Paper, c. 4455, of 1885. PART II. — RETALIATION. 335 — to treat the sugar interest as identical with that of the whole people. The interest is rather that of English capital. The black population have other employments and other interests. In the second place, the West India sugar interest is a small interest compared with that of the consuming classes in England. The annual value of the whole of the sugar produced in the West Indies is probably under £5,000,000, as compared with £25,000,000, which was the declared value of the sugar imported into the United Kingdom in 1883. According to the representations of the West India sugar interest (which are no doubt exaggerations), the re- duction in price of the sugar consumed in the United Kingdom due to foreign bounties is over £5,000,000. So that for the purpose of a small increase in their revenue, they ask us to sacrifice a sum which is more than equal to the whole of their production. In 1891 the West Indies exported 266,000 tons of sugar, and in 1901 253,000 tons. For the same years the sugar imports of the United Kingdom were 1,376,000 tons and 1,732,000 tons respectively. It must be remembtred that between these years the methods of beet sugar production had so improved as greatly to reduce the price, independently of artificial reduction in England by means of foreign bounties. In considering the West India Islands it must aKo be remembered that only a small proportion of the popu- lation are planters interested in high prices, and that the great majority are benefited by a reduction in the cost of one of their chief articles of food. Under these circumstances, whilst admitting that the West India sugar interests are suffering from the fiscal systems of other countries, though to a much less extent than has been supposed, they have no case for any remedy which would injuriously affect the much larger interests of consumers in the United Kingdom. It remains to consider very shortly the remedies sug- gested by the refiners and the West India interests. These consist in Retaliation by means of duties to be imposed on bounty-fed sugars. It might be sufficient to refer to what has Ix'cn said above as to Retaliatory duties in general. All the arguments against Retaliation in the case of Pro- Planters' interest and Colon'al in- terests not identical. •West India sugar a compara- tivrly small interest. They have no case for change of our fiscal system. Remedies suggested by them. Retaliation on bounties. 336 FREE TRADE V. FAIR TRADE. tective duties apply to Retaliation against bounties. Pro- tective duties are even more injurious to the interests of this country than bounties, since they operate no less than bounties to the disadvantage of our producers ; whilst, unlike bounties, they confer no benefit on our consumers. Both alike limit our means of selling ; but foreign bounties give us the means of buying cheap, which foreign duties do not. This is subject to the proviso that where foreign Protective duties are very high, they do occasionally enable us to buy cheap, as they enable Protected manufacturers to screw such exorbitant prices out of their home population that they frequently "dump" their surplus goods at cost price in the English market. It is said, indeed, that, economically speaking, bounties are worse, even for the consumer, than Protective duties, because bounties may have the effect of destroying the natural source of production, and thus leave the consumer in the end to the mercy of the bounty-fed monopolist. But this seems to me a very far-fetched argument. It is very difficult to imagine a case in which an industry which re- quires the stimulus of a bounty to set it on its legs, should become so strong as to mono])olise the world, to be able to dispense with the bounty, and still to prevent the natural industry from reviving. I am not aware of any such case. At any rate, it is not the case with sugar. But there are some special considerations affecting Retahation against bounties, and against these bounties in particular. If we begin by retaliating against bounties, we must ask what is meant by the term. Canada and all new countries make grants of land to emigrants. Is this a bounty on corn-growing ? The Indian Government sub- sidise railways. Is this, as some of our agriculturists are now alleging, a bounty on Indian wheat ? Brazil guar- antees interest on capital invested in sugar factories, and New Zealand gives them special encouragement. Are all these bounties, and are they to be assailed by Retaliatory duties ? If so, what are the Retaliatory duties to be, and where are ihey to stop ? In the next place, what is the exact amount of the duty PAKT II. — KKTALIATIOX. 337 to be ? It is intended to neutralise the bounty, neither more nor less. If it does more, it is plain Protection ; if less, it does not answer its purpose. But no one has the least conception what the bounty in any case is; It differs in every country ; on every parcel of sugar. No two opinions agree about it in any one case. To determine the amount of such a duty baffles all the experts. It is an impossible task. Again : any such countervailing duty would be con- trary to the most important clause in our commercial treaties — viz. tliat by which we give and receive " most favoured nation treatment." Again : it is very improbable that Retaliatory duties would produce the desired effect on foieign Governments. Most of them, for financial reasons, now dislike bounties, and know that they are taxing their subjects to give us cheap sugar. If we retaliate, it will show that we think the bounties beneficial to the country which proposes them, and injurious to ourselves, and this will lend strength to the interests which desire to retain them. Lastly, the effect of any countervailing duty would be to raise the price of a necessary article to all the people of the United Kingdom, and it would raise it by much more than the amount of the duty. Assuming the duty to be 2s. 6d. per cwt., which is apparently not much more than half what the West India Committee thought necessary in 1884*, the amount of the tax, with a consumption of over a million of tons, would represent an additional tax of two and a half millions, and the actual burden of the tax would probably not be far short of five millions, or the equivalent of an income-tax of from 2d. to 3d. in * In the Bo.ird of Trade Report on the Sugar Trade, Pari. Paper 325, of 1884, page 10, it is slated that the " excess reduction of price due to bounties is estimateil by the West India Committee at £s P^r ton," which is equivalent to 5s. per cwt., and this statement is borne out by an oflicial letter of the West India Committee, dated 24th July, 1884, Pari. Paper 345, of 1884, p. 166. The inft-rence in the text, thercfoie, seems to be accurate. But the West India Committee have since informed me privately that in their opinion a duty of is. to 2s. per cwt. \vould be sufiicient to countervail the duty ; and £2 per ton or as. per cwt. was named by Mr. Mariineau at the nieeiing on the 26th .March, 1886, as the amount of duty which would s.ilisfy the sugar industry. The |)oint, how- ever, is immaterial to my argument, since whatever the duty may be, the price must be raised by the amount staled in the te.xt, or the duly would fail in its proposed effect, W .Sugar. What are the Retalia- tory duties to be? " Most favoured nation" clause. Bad effect of Retalia- tion abroad. Effect of duly on price. 33^ l-REE TRADE V. 1-AIR TRADE. Conclusion the pound, which would be paid chiefly by the working The figures given on page 322 show that as a matter of fact the burden of a tax bringing in a revenue of ;i^2, 121,000 was ^3, 931. 000, the actuality thus very closely bearing out Lord Farrer's estimate. The case against reversing our financial policy by Re- taliation of any kind, in the case of any article whatever, seems to me to be overwhelming. But that any impartial person should be found willing to reverse it in the case of sugar would be simply astounding. I have thus dwelt at length on this subject of sugar, in the first place, because of the great and groNving importance of the article ; in the second place, because it illustrates the operation of bounties as well as of Protective duties ; and lastly, because the financial history of sugar in this and in other countries illustrates admirably the value of the principle of Free Imports, which is advocated in this book. By means of the Sugar Convention, which was signed at Brussels in March, 1902, and came into effect on September 1st, 1903, "The High Contracting Parties engage to suppress from the date of the coming into force of the present Convention the direct and indirect bounties by which the production or expartalion of sugar may profit, and not to establish bounties of such a kind during the whole con- tinuance of the said Convention." The Convention is to last for five years, and was signed by representatives of the United Kingdom, Germany, Austria-Hungary, France, Spain, Italy, the Netherlands, and Sweden. During its continuance the United Kingdom engages not to give preferential treatment to sugar from British Colonies ; but, on the other hand, refuses to subject sui^ar from Colonies which may give bounties on its production or manufacture to the penalties which in other cases would be entailed by adhering to the Convention. These penalties are either the imposition of special rates of duty on the sugar of bounty-giving countries or total prohibition of its import, at tiie choice of the country to which the bounty- fed sugar is exported. The special rates of duty are fixed by a permanent commission, meeting at Brussels, and have relation to the amount of the bounty given ; but the United Kingdom is at least unconcerned in the disputes and difficulties involved in these special duties, since it has adopted the alternaiivc of totally excluding sugar not produced or manufactured in accordance with the terms of the Convention. The amount of the surtax, to which Lord Farrer makes frequent FAKT II. — RETALIATION. 339 reference in these i)age3, is limited by the Convention to a maximum of 6 francs per lOO kilogrammes on refined sugar, and to 5 francs 50 c. on other sugar, this proviso not applying, however, to the rate of import duty in countries which produce no sugar. While the Convention is highly satisfactory to those members of it which inflicted serious injury upon themselves in their endeavour to capture the British market by means of giving ruinous bounties, and are now secured against the competition of Russia and other countries which refuse to sign the Convention, it appears likely to have disastrous effects on British industry. The manufacturers of jams, biscuits, and confectionery are severely hampered by the rise in price of their raw material, and they are further laid open to the competi- tion of other countries, which may purchase cheap bounty-fed sugar — prohibited in England — from Russia or elsewhere, and "dump" in England confectionery and other sugared goods manufactured from it. The Convention thus makes countervailing duties upon such goods a necessity if justice is to be done, and paves the way to a general system of Protection. Apart also from its bad economic effects, the adherence of the United Kingdom to the Convention has subjected domestic legislation and England's relations with her Colonies to the will of a commission on which the representatives of foreign countries have an overwhelming mijority. " Freedom is greater than Free Trade," and freedom is sacrificed to such an extent that the Uni ed Kingdom is forl)idden, even should it desire to do so, to give preferential treatment to the sugar of its Colonies and dependencies. Reference has already been made to the penalising of Ceylm and Indian teas by Russia by way of retaliation as one of the first-fruits of this Convention, so hurtful both to domestic industry and Imperial relations. CHAPTER XLIX. CONSEQUENCES OF RETALIATION, IF PRACTICABLE. We have seen that Retaliation would be an impotent Conse- wcajwn in our hands : that to retaliate on articles of food, quences of or of raw material, is out of the question ; and that to retaliate on manufactures, as ])roposed by the Fair Trade League, or on luxuries, as proposed by Lord Salisbury, would have no effect except that of exposing us to a far more dangerous Retaliation in return. We have also seen that our position as Free Traders in the midst of Pro- Retalia- tion. 340 FREE TRADE V. FAIR TRADE. Conse- quences of Retaliation. English- men must buy d arer and worse Goods. S^le of English Goods would bf diminished Materials would be scarcer and dearer. tectionist countries is not such as to call for a change in our policy. But, assuming that all these things were un- proved, supi^osing that a fundamental change is necessary, and supposing that a Retaliatory policy were possible for us, it is worth while to consider what its consequences would be. 1. One effect of RetaUation would be to deprive English people of the goods they can buy better and cheaper abroad. This, if confined to luxuries, would, perhaps, be the least of the evils caused by it. If the only effect of a high tariff were to limit the sums expended on the hot- house, the shrubbery, the game preserve, the hunting stable, the race-course, or the ball-room, there would be comparatively little objection to it. The national loss would be small, but the effect, whether for fiscal or econo- mical }iurposes, would be small also. If Retaliatory duties are to have any real effect, they must touch things which a great many people want and use : and in this case the comfort and convenience of a large number of people would be seriously affected. 2. A second effect of Retaliation would be to diminish the sale and manufacture of English goods. Goods of foreign make bought for our use af home are ex hypoihesi better and cheaper than similar goods of native manu- facture. Goods of English make bought for use by foreign- ers abroad are ex hypothesi better and cheaper than similar goods of foreign manufacture. If English people are i)re- vented from buying abroad, and foreigners from buying here, there will be less produced, less profit made, and less to spend in return on both sides. The Frenchman who sells his silk to us makes more profit, and buys directly or indirectly more of our goods in return, than the English silk merchant would do if we were to compel English people against their will to use English silk instead of French silk. 3. We should cripjile our own trade by depriving it of materials. Many, if not most, articles arc made for further use in manufacture. What is a manufactured article in retrospect is raw material in prospect, as I have shown in the case of sugar, dressed hides, and numerous other articles. 4. We should also stunt and crip])le our manufactures by bestowing the fatal gift of Protection upon them, and PART II. — RETALIATION. 341 depriving them of the stimulus of foreign comj^ctition. Conse- At this moment our leather trade suffers l)y American com- Ret^^^tjo^ l)etition. because the Americans tan hides cheaper than ^^ ^^ . , we do. Our Bradford fabrics have been suffering, because lofe the our wives and daughters have found French or German stimulus woollens pleasanter or prettier than Yorkshire goods. They peiituJll' are now recovering their custom. If we were to exclude American leather, or French woollens, we should exclude the stimulus requisite for improvement in the tanneries and woollen mills of Englancl, and very likely stop the improvement in these particular manufactures which is at this ver}^ moment in progress. In an earlier reference to woollens it has been shown that though our exports are less than they were, more wool than ever is being manufactured in England for home consumption. At the same time the yarn makers of Bradford have a very large and profitable demand from Germany, which would be killed or reduced if retaliatory duties were placed on the German woollens made from Bradford yarns and imported into England. And not only would the yarn manufacturers suffer, but so would the manufacturers of clothing, of whose industry woollens are the raw material. 5. A further and a most serious evil has not been suffi- ciently considered. We are not now arguing with pro- fessed and straightforward Protectionists, who say that they wish to keep out foreign goods altogether ; we are arguing with people who profess to wish to exclude foreign goods only in order to make foreigriers admit English goods. Now what will be the position of our unhappy protected interests when Retaliation has effected its purpose, and when the foreign nation against whom it is directed offers us a free tariff on the condition of our repealing our Protective duties ? We shall have nursed up a miserable interest, feeble for purposes of jiroduction. as protected interests always are, but powerful in the lobbies, and clinging with tenacity to its Protective duties, which will then be seen to stand in the way of other and more import- ant interests. This unhappy interest will either maintain itself to their detriment, or it will be sacrificed for their l)enefit, and its last state will be worse than its first. The ribbon-weavers of Coventr\' havi' time out of mind been Last state of Protected Interests worse than the nrst. 342 FREE TRADE V. FAIR TRADE. Conse- comi)laining of bad trade and foreign competition. Since quences of ^j^g French Treaty they have, at any rate, known their tion. fate, and Coventry has other manufactures and other prospects of prosperity. It would be the height of cruelty to tempt capital and labour back into the ribbon trade by the prospect of a Protection against French ribbons, to be withdrawn as soon as the French people become alive to their own true interests, and repeal their duties on English iron and cotton. Such are the evils which would follow upon retaliation in the very unlikely case of its being successful. A consideration of the existing facts makes it very hard to see on what grounds Fair-traders expect a reduction of foreign duties as a result of adopting duties at home. The Protectionist nations do their best to bar out each other's goods by Protective tariffs just as high as, and in many cases higher than, those levied on our own. Retaliation, as a rule, provokes more retaliation, and in those exceptional cases where a duty, or the threat of a duty, induces a foreign nation to give some concession in ex- change for its non-imposition, the United Kingdom gains all the advantage without any of the risk, for under the most-favoured-nation clauses of numerous treaties other countries are bound to admit British goods at the lowest rates scheduled in their tariffs. The exceptions to this rule are few and trumpery. In Germany, France, Russia, Austria-Hungary, Italy, and Japan all the produce and manu- factures of the United Kngdom and those of most of her Colonies are subject only to the lowest duy which is levied on the goods of any o her nation, for whaiever reason the duties may have been reduced. In the United States there are concessions on crude tartar, wine, spirits, paintings, and statuary given to France, Portugal, Ger- many, and Italy, and reciprocal commercial airangements not accorded to the United Kingdom. Spain and Portugal give each other certain advantages denied to England, but wiih these excep- tions all countries treat Great Britain as the most-favoured nation. At least, these were the only exceptions until the United Kingdom joined the .Sugar Convention and excluded Russian sugar, this depar- ture from Free Trade principles being followed by retaliation on Russia's part in charging higher duties upon Ceylon and Indian teas, and threatening to withdraw the most-favoured treatment from British products. Germany denies to Canada the most-lavoured- nation treatment, and subjects Canadian goods to the general tarifl because Canada levies higher rales on German goods than those charged to the United Kngdom. In these circumstances, where is the justification for thinking that penalising imports from the PART II. — RETALIATION. 343 foreigner will iinluce him to remove penalties, or, rather, one should Expenses say duties, from our exports ? England as the one Free Trade of Collcc- country in the world is nowhere penalised, but receives better treat- ^'°"' ment from her Protectionist rivals and neighbours than any single one of them is accorded in foreign markets, and Canada, which differen- tiatts, is offered no bribe to abolish the differentiation, but imme- diately finds her goods handicapped in at least one foreign market. To Free-Traders it seems reasonable enough that Protectionist Ger- many should accord better treatment to the United Kingdom, which gives her an absolutely free market, than to Canada, which gives better treatment to the Mother Country. But to our new Protection- ists it seems an attack upon the Empire, and they profess the expect- ation of forcing Germany to favour Canada by threatening British penalties on German products. The result would probably be the removal of the United Kingdom as well as of Canada from the most- favoured-nation list in the German tariff. Against duties levied as a matter of Protective policy there might be no reason for complaint, but against their enactment avowedly for the purpose of forcing Germany's hand and dictating to her a tariff policy there would be, unless the Germans are a much humbler folk than they have ever shown themselves, a feeling of irritation, sure to manifest itself in a manner inimical to British interests. In spite of tariffs the United Kingdom is a serious rival to Germany, which might easily welcome an excuse for more effectively shutting out our goods from her markets. For it must not be forgotten that the Germans are Pro- tectionist by conviction, and by no means ready to recognise the evils that such a policy wouKI intiict upon themselves. 6. A sixth evil of Retaliation peculiarly evident to the Confusion official mind, but not the less a gi'eat public evil, is that it would lead to all the confusions and difficulties which arise from duties differing according to the nationality of the goods, and all the mischiefs and frauds attendant on certificates of origin, and upon valuations for the purpose of levying duties. Anyone who wishes to see how great this evil is should look at Mr. Secretary Manning's Report to the United States Congress, presented February i6th, 1886. A generation has passed away since the reforms of our own tariff swept this troublesome rubbish into the official waste-pajier basket. Those who were at work then can remember what a relief that reform was. But the mischiefs formerly caused to trade in its then contracted state were as nothing compared to the evils which such a at the Custom House. 344 FREE TRADE 7'. FAIR TRADE. system would now inflict on liadc, considering the in- finitely greater number of commercial dealings which now take place, and the infinitely greater speed with which they must be conducted. 7. A seventh evil would be an increase in the cost of the Customs staff, and in the general expenses and trouble of collection, which would run away with a large part of any duties that might be imposed. 8. Another, and most formidable evil, is that which American writers have pointed out as actually happening in the United States — viz. the lobbying and jobbery of all the different special interests seeking Protection, tending, as has been stated above, not only to economical mischief, but to political degradation. Protection begun for Retaliation will not stop there. Even the most ardent Protectionists sometimes admit this dane;er, and Dr. Beattie Crozier, advocating Protection in the July number of the Fortnightly, 1903, is constrained to conclude his article thus : "And yet in contemplating the return to Protection which sooner or later awaits us, we cannot but linger with a sigh over the halcyon days of Free Trade — a brief summer of Imperial supremacy like that of Rome in the age of the Antonines, before her inevitable decay set in ; for wiih a Parliamentary Government without central controlling initiative like that of the Czar or German Emjieror to keep its hand on corruption, the vast interests involved in every change of tariff under the rt's^inic of Protection must put such pressure on individual members of ihe Legislature that the present purity of our political institutions will gradually tend to disappear, and the Boss, the Lobbyist, and the professional politician, as in France and America, will enter with all their train." 9. Finally, Protective duties im])osed for the ])urpose of Retaliation would not, any more than Protective duties imposed for the purpose of revenue, be confined within the limits necessary for their professed purpose. It is the nature of Protection to feed upon itself, to extend its borders as long as there is anything outside them, and to jnevent its own abolition by creating an ever-increasing number of narrow vested interests which dejiend, or think they depend, on its maintenance. All experience proves this. If tliere is any one lesson to be learnt from the recent polirv of the I'nited States, of Cicrmany, of France, of PART II. — RETALIATION. 345 Russia, of Canada — in short, of all countiies which Jiave embraced Protection — it is that the first step on the down- ward path is sure to be followed by others, and that those who really look to Free Trade as the ultimate object of their commercial policy are out of their senses if they coquet with the smallest and most specious form of Pro- tection — c'cst Ic premier pas qui coute. CHAPTER L. RETALIATION ON FRENCH SILKS AND FRENCH WINES. Let us see how Retaliation would work in an actual and Retaliation not improbable case. Proposals to tax French silk have '" j!]^ /^^^^ been made, and are not unlikely to be made again. Silk is, comparatively speaking, a luxury, and it is an important French manufacture. According to our own statistics, we imported silk to the value of about lO millions sterling from France in 1880. There is some reason to doubt these figures, as the exports from France to England, according to French statistics, were only 6i millions, of which 3I millions were French manufacture ; but it is certainly an important article of French manufacture and export. We also make and export a laige quantity of silk manufactures, amounting in 1884 to over two millions. Let us see what would be the consequence of a high Protective duty on French silk imported into England. The French supplement to the Moniteur Officic ae Commerce for June, 1903, dealing with Franco-British commerce for 1902, states that where the English figures give 250 million francs as the value of ihe imports of French silks, the French export figures are only 160 million francs, the difference being accounted for by the transit trade already referred to. Our exports of silk manufactures are less than in 18S4, being now only /i, 631,000. From this Protectionists, of course, jump to the conclusion that the trade has been injured by lack of Protection, and yet the growth of the silk industry is a remarkable example of the beneficial effects of Free Tiade and the blighting eflects of Protection, and the recent decline in our exports must be sought in 346 FREE TRADE V. FAIR TRADE. other than tariff reasons. The English silk imlustry is lOO years older than that of Lyons, and was well established in 1363. Without a shred of Protection it employed 40,000 people in the reign ot Elizabeth ; but in 1697 the importation of European silk manufactures was prohibited, and in 1701 the prohibition was extended to silks from India and China. In 1719 a duty of 4s. 8d. per lb. was imposed on imported thrown silk, and from this date the silk industry declined. In 1S16, at a public meeting for the relief of the Spitalfields weavers, the secretary said that 66 per cent, of them were unemployed, and Mr. I'owell Buxton stated that the distress among the manufacturers partook of "the nature of a pestilence which spreads its contagion around and devastates an entire district." Mr. Wardle, a Protec- tionist authority on the silk trade, admits that " during these years of high Protective duties the English manufacturers ilept and fattened in their security," and that they learnt too late " that they had been pro- tecting their own ignorance." English looms were the worst in Europe, but were improved under the Free Trade ri'gim •, and though we have recently lost ground again in silk manufacturing, the history of its Protected days gives the strongest possible reason for believing that that way no remedy lies. 1. English people would get their silk goods less good and less cheap. This, it may be said, is a trifle. Silk is a luxury, and people can do very well without it. I will admit that it is not the most impoitant of articles ; but is it a trifle to make the handkerchief, the ribbon, the Sunday gown, dearer and uglier ? Is it a trifle to take from our people one of the few articles which add grace and beauty to our somewhat sombre and dreary life ? Speaking in the interest of those who can spend little upon mere beauty and ornament, I cannot come to any such conclusion. 2. It will injure a certain number of workmen and workwomen, who now make their living in England by making uj) into dresses the comparatively good and cheap French silks which we get from France. This is more important than it seems. Without attaching too much importance to the figures, I may again mention the fact that Mr. Worth, the great Paris dressmaker, states that a liberal tariff for materials of dress in France would increase Paris exports tenfold ; and that a three weeks' Court mourning in London is even now a loss of {600,000 to Paris dressmakers.* * C. 4715, i., p. 127. PART II. — RETALIATION. 347 3. It will diminish the quantity of English goods which are now sent, directly or indirectly, to France in return for French silk. This is beyond doubt. Whatever France sends us we pay for, and we pay for it in something we can make better than she does ; we shall lose a certain quantity of French custom, directly or indirectly. But it will be said, " The money now spent by English people on French silk must be spent on something else ; that something will probably be silk made in England, and so English labour and capital will be employed as much and as profitably as if they were employed to pay the French for their silk." The rejoinder is clear : they wdll be employed, but not as much or as profitably. Ex hypoihesi, the French make the silk they send us better and cheaper than we do ; they can make more profit out of it, and can therefore spend more on other goods of ours in return. On the other hand, it is equally clear that the English capital and labour which we are going to divert into the silk business is now em- ployed on something which pays better than silk, or they would be employed in making silk. Consequently, by diverting this labour and capital to silk-making we are making it less profitable than it was before the tax. There will be a loss all round. 4. It will deprive our owoi silk manufacturers of the stimulus for improvement now arising from French com- petition ; and this, considering the value of French taste and ingenuity in improving the beauty of manufactures, is no small consideration. 5. It will call into existence a protected manufacture, weak and sickly as such manufactures always are. Who that remembers the constant distress of the Spitalfields weavers in the days of Protection can desire to see English money and English workmen again tempted by Protective duties into such a business ? 6. It will not only coax a miserable trade into existence, but if Retaliation answers the purpose of its promoters, and the French are induced by our refusal of their silks to offer to take our cottons and wool and iron on reasonable terms, we shall be forced to abandon this protected trade to the tender mercies of French competition. We shall have in- dulged it and pampered it only to betray and desert it. We I'ewer English Goods will be made and sold in Exchange. Silk manu- facture in England will not be stimulated by Compe- tition. A weak manufac- ture will be fostered. And this weak intrrest will here- after be deserted. 345 FREE TRADE 7'. FAIR TRADE. The Custom House will have to dis- tinguish the Country of origin of all im- ported Silk. Retaliation on Wine. shall have CHlucatcd a body of skilled work|)eople to a special branch of work only to be left helpless and useless when it comes to an end. 7. In the meantime we shall have to distinguish at the Custom House between French-made silk and oil other silks ; for it is an essential part of the policy of Retaliation and Reci})rocity that we are not to place these duties on the goods of countries which take our goods free. Switzer- land, for instance, and probably Italy, send their silk goods to us through France. French goods may be sent to us through Belgium or Holland. We must therefore ascertain, before we allow any bale of silk goods to be landed in England, whether they have been made in France or in some other country. Conceive the confusion, diffi- culty, and delay which such official obstructions would cause. The}^ would injure trade more than the tax itself. In silk I have taken a manufacture which is carried on both in France and England, and in which, therefore, Retaliation involves Protection to English manufacture. This would not be the case with wines, to which " X." (the writer in the Pall Mall Gazette, to whom I have referred above) points as an article on which we might properly lay a Retaliatory duty. If our hands are freed from treaty obligations, and if either fiscal or social reasons lead us to desire to alter our wine duties, by all means let it be done ; but if they are to be purely Retaliatory — that is, if we impose duties which we know to be injurious to our- selves for the purpose of injuring France, and thereby comj^elling her to reduce some of lier duties on our goods — then they would be open to all the objections I have pointed out in the case of silk. They would, it is true, not protect our manufactures of wine, as we have none, but they would protect the wine-growers of Spain, Italy, and Germany, which it is certainly not our object to. do. In all other respects such duties would be followed by every one of the evil consequences I ha\'(' pointed out as the consequences of a Retaliatory duty on silk. 349 Retaliation will provoke Retalia- tion. CHAPTER LI. RETALIATION DOES NOT ONLY NOT EFFECT ITS OBJECT, BUT HAS A CONTRARY EFFECT. Almost any one of the objections above noticed appears to me to be fatal to the principle of Retaliation ; but there is still another objection, which has as great weight as any of them. Retaliation is not calculated to effect its object ; it is calculated to effect the very opposite. It grows upon itself. It provokes additional Retaliation, until the nations arc ho})elessly alienated. A little consideration will show how natural this is, and how little reason we have to expect a favourable result from it. In the first place, we lead Protectionists to think that we do not believe in our own principles. " See," they will say, " what England is doing. She professes to believe that the lowering of import duties is a good thing in itself, and yet she is taking the first opportunity to raise her own. We will follow her example rather than her precepts." In the second place, a natural feeling of antagonism is aroused ; and feeling is often stronger than self-interest. " We are giving so much, and you give so little ; we will ])unish you by giving less." Canning's well-known despatch involves a political, if not an economical truth : — " In matters of commerce the fault of the Dutch Is giving too little and asking loo mucli ; With equal advantage the French are content, So we'll clap on Dutch bottonii twenty per cent." It needs no thought to feel angry at an over-reaching bargainer ; it needs much thought to see that the over- reacher over-reaches himself more than he over-reaches us — that we are the greatest gainers l)y what we have given him. But this is not all. The strength of Protection lies in Strength of the ])ower of concentrated protected interests. They spend money, time, and trouble in defence of their privi- leges ; they intrigue behind the throne ; they crowd the* lobbies ; and are ready to take the l^est advantage of the jK)pular indigiuitit)u caused by an tmsuccessfiil negotiation. It shows Mistrust in our own Principles. It arouses antago- nism. protected interests. 350 FREE TRADE V. FAIR TRADE, Experience in France. The ]-'rench Emperor was either unable or unwilling to sacrifice his French ironmasters, though cheap iron was one of the first necessities of France. M. Tirard quakes before Rouen and Roubaix. The ironfounders of Penn- sylvania are more urgent in the Senate House at Washing- ton than all the Western prairies. It needed a most un- usual conjunction of political philosophy, public interest, wealthy manufacturers, distress among the working classes, and heroic leaders, to repeal our own Corn Laws. Our shipowners have scarcel}^ yet forgiven the repeal of the Navigation Laws, though freedom of trade has given them the command of the seas. The recent growls from Preston, from Bradford, from Lincolnshire, from the farming interest and the sugar interest, show how soon and how easily, even in this country, partial and self-seeking interests could mislead the multitude and excite a jealous and angry cry, not only for Fair Trade, but for absolute Protection to every special interest. Once embarked in a war of tariffs, and we are much more likely to arrive at Prohibition than at Free Trade. France is one of the countries which has been making the most retrograde steps, and it is interesting to see how in France one Protective measure is leading to others. She protects the yarns which her silk manufacturers need, so she is asked to give a bounty on the export of silk. She protects her own sugar-growers, so she must also pro- tect her colonial sugar-giowers and her refiners. To remedy agricultural distress, which appears to be greater in France than in England, the French Legislature has imj:)Osed Protective duties on imported oxen of £i a head, and on imported corn of 5s. a quarter. The duly on oxen is now 20 francs per lOO kilogrammes live weight, which, on a fat beast, would amount to £2 or over per head The duties on corn and flour have been more than doubled. The tax on corn has led to a still higher duty on foreign semolina and similar stuffs in order to protect the French makers of those articles ; and to a very high Protective dutv on foreign Hour in order to ])rotect the French millers. But the remarkable thing in reading the discussions on these measures is that the most common and most successful PART II. — RETALIATION 351 argument for Protection to agriculture was that French manufactures were already protected at the expense of French agriculturists, and that it was therefore only fair to French agriculturists that they should be protected in turn, at whatever cost to French manufacturers. One bad step involves another. Each class seeks to be protected in turn ; and they form in the end a ring of jobbing interests which unite in opposition to the public interest, because though all suffer by it, each is afraid to be the first or only one to lose its privileges. Precisely the same course has been followed in Ger- many, in Canada, and in Russia. One step has led to another until the vicious circle is complete, and Free Trade is further off than ever.* The history of Protection in the United States is also very instructive. f A moderate Protective system existed before the Civil War. During the war everything was taxed, whether imported or produced at home. Protective duties were largely increased in order to compensate for internal duties on the same articles, or for import duties on the raw material. After the war internal duties were taken off, but the compensating duties on imports were continued. They have even been increased, and such has been the influence of the protected interests on each change in the tariff, that measures intended to give some relief to the consumer have been so manipulated as to give more Protection to the manufacturer. The Americans have now, probably, the worst tariff in the world ; and, whilst they injure other nations, they are themselves the greatest sufferers by it. Nor are the evils which result from it economical only. Mr. Taussig says : — J " Contributions to the party chest are the form in which money payments by the protected interest are likely to have been made, so far as such payments were made at all. But the general laxity of thought on jniblic trusts undoubtedly made possible the manipulation of the tariff in the interest of private individuals. The tone of political life — as indeed that of commercial life — was lowered by the abnormal economic conditions that followed the war, Retiliaiion produces Retalia- tion. Experience in Ger- many, Canada, Russia and the United States. * See above, pp. 137, i66, 180, 214, etc. X "History of the Present Tariff," p. 75. t See above, pp. 211 and 237. 352 FREE TRADE V. FAIR TRADE. Ketaiiaiion aiid tlic general demoralisation enabled the protected in- RTtaiia" terests and their champions to rush through Congress tion. measures which, in a more healthy state of public affairs, would have been reprobated and rejected." Those who are anxious to re-introduce Protection in this country should be warned by the example of the United States, that if this game of favouritism to special interests were once begun, it is not likely to stop without endangering public moralit}^ and causing evils which are even worse in their social and political than in their econo- mical aspect. In the Dingloy and McKinley tariffs the United States has gone to the worst and e.xtremest lengths of Protection ever known, and the state of political morality in that country is notorious. The con.stant tinkering with the tariff at the bidding or suggestion of Protected interests, which is such a feature of American politics, is illustrated by the following table of alterations — most of them more or less trilling — within the last seven years : — Au ValorEiM Rates of Duty in thb United States in the Veaks i8g6, 1898, 1900, and 1901. U.NITED States Tariff. Breadstuffs Chemicals Cotton Earthenware Flax : Ka* Manufactured ... Fruit and Nuts 'Glass Iron and Steel Jewellery Leather and Manufactures ... Liquor: Malt Distilled Wine .. Sugar ... Tobacco Leaf and Manufactures Wood and Manufactures i?96. 1898. 1900. % % 7. 25 33 33-46 3i'c4 31 '20 29"35 45"82 54-78 55-34 3J-8I 55"37 58 82 7 "03 >3-74 '3'S7 45-58 4114 39'S3 '973 46-95 44-32 46-07 57-4J 5760 37'73 45 '6 1 37-47 16*40 12-28 138 J 25'47 32 "3° 3531 iS'iB 53'46 50 '3 "5'77 «45'35 •35-33 ' 5080 51-72 51-70 41 '20 54'o3 76-42 107-73 120-55 105-96 , 23-OD 21-62 18-49 ' I90I. % 3»-" 26-96 54-8; 5879 1 1 06 3933 39-08 5844 38-iS 12-99 35 -»3 50-60 130-38 50-2C 73-68 110*62 i8-i2 Protec- tionist Countries get no better terms than we do. But, to return to the economical effect of Protection, what are the teachings of experience ? We have some Protectionist and some half-Protectionist coimtries. Do they get better terms from each other than the Free- trading countries ? Does the United States get better PART II. — RETALIATION. 353 terms from France or Germany or Canada than England j, allure of or Holland ? Are the Protectionist countries ready to fly early into each other's arms ? We know very well that this is Reciprocity T^i r 1 1 • r 1 ne>ably Mr. Vincc's error here was quite honest and accidental. It is, of course, possible also that he was merely careless and mistaken in giving the "exports of British and Irish produce and manufactures" as the etiuivalent of the total British import and export trade referred to by Lord Farrer and Mr. Forster ; but the fact remains that by misquoting the things compared and the years for which the comparison was made he makes his invitation to " take advantage of the wider outlook which 20 years' more experience gives to our generation," result in the pleasing conclusion that "thus further experience has entirely overthrown the argument on which this great Free Trader based his opposition to Mr. Forster's Imperialism." If the figures had altered, it would in no way disprove Lord Farrer's argument — the undisputedly great increase in our Colonial trade shows that no preferential tariffs are needed to develop it — but, as a matter of fact, even the wider outlook which 20 years' more experience gives to our generation, provided it is not like Mr. Vince's outlook, absolutely wide of the mark, shows that " our trade with the Colonies, instead of increasing more than twice as fast as our trade with foreign countries, did, in fact, just keep pace with it." The figures will be found on p. 42. Further on Mr. Vince endeavours to show that Lord Farrer was mis- taken in believing Protection to check the progress of the United States and Germany. His manner of showing it is, of course, to concentrate attention on the increased export trade of these countries, entirely leaving out of account that the great increase in American exports has been coincident with the formation of trusts, which, as elsewhere shown, are raising prices and limiting employment in America, and that in Germany the years of greatest export have been years of acute business depression and general distress. To comment on all the fallacious arguments used by Mr. Vince and Mr. Chamberlain would be to re-write this book, in which there is not one claim that does not find an answer. The main Protectionist arguments, ndeed, are answered by the Protectionists themselves. Mr. Vince, for instance, declares that Free Trade has ruined the British farmer by reducing the price of his corn, and at the same time maintains that it has been cheapened by improved tillage and means of locomoiion. "We owe cheap bread lo mechanics, not to politics." This being so, he and Mr. Chamberlain invoke the aid of politics to defeat mechanics and make it dear again ; and almost in the same breath as they advocate this artificial dearness they promise that the result of the corn duties will not be really dearness, but increaseil cheapness, through the rush of British and foreign farmers to obtain llie high pi ices which they arc tricked into exi^ccting as 374 FREE TRADE V. FAIR TRADE. the result of a taiiff against the foreigner. And even the tariff against the foreigner is to be usetl to trick the Colonics. They are asked to grow wheat and meat in huge quantities for the British market — a market liable at any time to be Hooded with the wheat and meat of America when retaliation has had its predicted effect of inducing America to give freer entry to British goods, and American corn is once more admitted free. That retaliation will not have this effect matters nothing. Mr. Chamber- lain and Mr. Balfour profess to think it will, and they calmly ask the Colonies to give up a measure of the Protection which is ex liypotlicsi so great a boon to them in return for an exclusive market which will be taken from them the moment that retaliation has done its work in benefiting, not the Colonies, but England. Not much loss to them, perhaps, since the delightful prospect is held out of competition among the Colonies so keen that it will give lower prices than the open market gives them now. Mr. Chamberlain's proposals are such a hopeless tangle of contradiction that no one thing seems c.lear concerning them beyond that in the "interests of Empire" they are designed to create ill-feeling between Englishmen and foreigners, in which they are sure of a full measure of .success ; and, further, that they will have the undesigned effect of occasioning sordid quarrels between England and her Colonies. As to what the effect of the duties proposed will be upon the prices of dutiable articles ; as to how, if prices are not raised, the producers will be profited ; as to how, if prices are raised, the consumers will avoid being damnified, study of the highest authorities leaves us hopelessly in the dark — as hope- lessly so as they are. Lord Palmerston is reported to have once .said in his Cabinet, "Now, gentlemen, is the effect of this ta.\ to raise prices or lower them. I don't care a d which it is to be ; but do let us all agree to say the same thing." For the sake of the bewildered public, if not for their own sake, it is fervently to be hoped that Mr. Balfour, Mr. Vince, and Mr. Chamberlain will agree "all to .say the same thing," or, if this be too much to ask, that they will individually make a practice of usually saying the same thing when they are asked whether food duties will increase or decrease the price of food. APPENDIX. TABLES. Comparison of our Foreign and Colonial Trade. 1. Statement of the Value of the Exports of British and Irish Pro- duce from the United Kingdom, and of the Amounts and Pro- portion exported to Foreign Countries and British Possessions respectively, in each of the Years from 1856 to 1902 inclusive t- 378- 2. Statement of the Value of the Total Exports of British and Irish, and Foreign and Colonial Produce from the ITnited Kingdom, and of the Amounts and Proportion exported to Foreign Coun- tries and British Possessions respectively, in each of the Years from 1856 to 1902 inclusive . . . . f. 379. 3. Statement of the Value of the Imports of Merchandise into the United Kingdom, and of the Amounts and Proportion from Foreign Countries and British Possessions respectively, in each of the Years from 1856 to 1902 inclusive . p. 380. 4. Statement of the Total Value of Imports and Exports of Mer- chandise into and from the United Kingdom, and of the Amounts and Proportion from and to Foreign Countries and British Possessions, in each of the Years from 1856 to 1902 inclusive ........./. 381. 5. Statement in Detail of the Total Exports of Merchandise from the United Kingdom to each of certain Foreign Countries and British Possessions, in each Year and Period of Five Years since 1866, with the Proportions that the Amounts for each Country and Possession bear to the whole Exports in each Year and Period ..... //. 382 to 393. 6. Statement in Detail of the Imports of Merchandise into the United Kingdom from each of certain Foreign Countries and British Possessions, in each Year and Period of Five Years since 1866, with the Proportions that the Amounts from each Country and Possession bear to the whole Imports in each Year and Period //. 394 to 399. 7. Statement compiled from the two previous Tables, showing the Proportion of the Total Foreign Trade of the United King- dom — Imports and I'-xports of Merchandise — carried on with each of certain Foreign Countries and British Possessions, in each Year and Period of Five Years since 1866 fp. 400 to 402. Zl^ APPENDIX Eff'i'cls of Frcttch /ndcmni/y. 8. Statement showing the Value of Imports of Merchandise into Germany from certain Countries, and of l^xports thereof from Germany to the same Countries in the Years 1868 to 1877, made up from the statistics of the different Countries named (in the absence of official German statistics) by treating the Exports from them to Germany as Imports into Germany, and the Imports from (lermany into them as Exports from Germany . /. 403. g. Statement showing the Total Value of Merchandise Imported into and Exported from France in the Years 186S to 1877, accord- ing to the French official returns ..../. 404. 10. Statement showing the Value of Imports of Merchandise into France from certain Countries, and Exports thereof from France to the same Countries, according to the French oflficial returns, in the Years 1868 to 1S77, covering the period of the payment of the Indemnity to Germany . . /. 405. Circuitous Trade b i-wecn the United Kingdom, United States, and India and other Countries 11. Statement showing the Value of the Imports of Merchandise and Treasure, on Private and tiovernment Account, into British India from the United Kingdom, and Value of the Exports of the same from British India to the United Kingdom, in the Years 1871 to 1880 and 1892 to 1901, compiled from the official statistics of the Indian Government . . . /. 406. 12. Statement showing the Value of the Imports of Merchandise and Treasure, on Private and Government Account, into British India from certain Countries, and Value of the Exports of the same from British India to the same Countries, in the Years 1871 to 18S0 and 1892 to 1901, compiled from the official statistics of the Indian Government . . . p. 407. Duties levied on British IVoaucc in Foreign Countries and Colonus. 13 and 14. Return of the Kates of Import Duty levied in the prin- cipal European Countries, in the United States and Japan, and in the principal Colonial Possessions of the United King- dom, on certain Articles of British Produce or manufacture, derived from the Board of Trade publications of 1885 and 1902 for Foreign Countries, and of 1902 for Colonial and other Possessions //. 408 to 415. Proportions in 'which Different Countries Supply us -with Food. 15. Statement showing in what Proportion, according to Value, the principal Articles of Food, except Fruit, were imported into the United Kingdom from Foreign Countries and British Pos- APPENDIX. 377 sessions in the Year 1902, with the Total Values of such Articles imported from all Foreign Countries and British Possessions respectively ..... pp. 416, 417. 16. Statement showing the Proportion per cent, of the Total Value of the Articles of Food named in Table 15, imported into the United Kingdom from Foreign Countries and British Posses- sions, for the Vears 1880, 1884, and 1902 . . p. 418. Comparative Returns of the Foreign Trade of the United Kingdom, France, Germany and the (Jnitcd States. 17. Statement showing the Total Value of the Imports and Exports (exclusive of Bullion and Specie) of the United Kingdom in each of the Years from 1854 to 1902 inclusive, with the Annual Average for each Quinquennial Period, and the amounts per head of the population .... pp. 419 to 421. 18. The same for France ..... pp. 422 to 424. 19. The same for the United States . pp. 425 to 427. 20. The same for Germany ..... pp. 428, 429. E.vports from the United Kingiom, France, Germany, and United States, classified as Food, A'a'c Materials, and Manufactures. 21. Statement showing the value of the Exports of British and Irish Produce in each of the Years 1870, 1880, 1884, and 1902, classified as Articles of Food, Raw Materials, and Manu- factured Goods pp. 430 to 435. 22. Statement showing the Proportion of Food, Raw Materials, and Manufactured Articles in the Domestic Exports of France for each of the Years 1869, 1879, and 1900, compiled from the French official returns ..... pp. 436, 437. 23. Statement showing the Proportion of Food, Raw Materials, and Manufactured Articles in the Domestic Exports of Germany for each of the Years 1869, 1879, and 1902, compiled from the official returns of Germany . . . //. 438, 439. 24. Statement showing the Proportion of Food, Raw Materials, and Manufactured Articles in the Domestic Exports of the United States for each of the Years 1870, 1880, and 1900 (Years ended 30th June), compiled from the official returns of the United States //. 440. 441- Miscellaneous. 25. Statement showing the Population, Public Debt, Imports and Exports of the Australian Colonies and the Dominion of Canada, for each of the years ended 1873 to 1901 . //. 442 to 449. 26. Summarised Statistics of the Population of the United Kingdom, and their condition from 1840 to 1902 — as far as the same can be given P- 45^^ 378 APPENDIX. TABLE I. Staieinent oftke Valve of the Exf>orts of British and Irish Produce />-(orted to Foreign Countries and Biiiish /'osscssious rcsfounds, i.e., 100^^ loo.coo. lixportod lo Foreijc'i Countries F.xporlctl irt British Possessions Total \-aliio Olll> on y. Years. of Exports of British ami Irish Produce. Amount. Per Cent, of Total. Amount. Per Cent, of Total. £. £, £. 1856 115,827 82.527 71-2 33.300 28-8 1857 122,066 84,911 69-6 37.15s 30"4 1858 116,609 76,386 65-5 40,223 34 'S 1859 130,412 84,268 64-6 46,144 35 "4 i860 135.891 92,226 67-9 43.665 32-1 1861 125,103 ^2,858 66-2 42.245 33-8 1862 123,992 82,097 66 '2 41,895 33-8 1863 146,602 95.723 65-3 50,879 34'7 1864 160,449 108,735 67-8 5'. 714 32 "2 i86s 165,836 117,629 70-9 48,207 29'I 1866 188,917 135,198 71-6 53.7'9 28-4 1867 180,962 131,162 72-5 49,800 27"5 i85i 179,678 129,813 72-2 49.85s 27-8 i86g 189,954 141,881 747 48.073 25'3 1870 199-587 147.773 74 'o 5>.8i4 26'0 1S71 223,066 171,816 77-0 5 '-250 23*0 1872 256,257 195,701 76-4 60,556 236 1873 255,i65 188,836 74 "o £6.329 26*0 1874 239.558 167,278 698 72,280 30-2 1875 223,466 152,374 68-2 71,092 31-8 1876 200,639 135.780 677 64,859 32 "3 1877 198,893 128,970 64-8 69,923 35 "2 1878 192,849 126,611 65-7 66,238 34'3 1879 i9i>532 130,530 68-2 61,002 31-8 1880 223,060 147,806 66-3 75,254 337 i88i 234.023 154.658 £6-1 79.365 33 '9 1882 241,467 156,641 64-9 84,826 35'i 1883 239.799 156,322 65*2 83.477 34-8 1884 233,025 152,149 65-3 80,876 347 1885 213,045 135,115 63-4 77.930 36-6 1886 212,432 136,926 64 4 7.S506 35-6 1887 221,913 146.543 66 "o 75.370 34 'o 1888 234,534 150,293 64-1 84,241 35 "9 1889 248,935 165,656 66-6 83,278 33'4 1890 263,530 176,160 66-8 87,370 33"2 1891 247.535 161,279 65-2 85.956 34-8 1892 227,216 152.467 67-1 74,748 32 "9 1893 218,259 146,109 66-9 72.150 33"i 1894 216,005 143,217 663 72,788 337 1895 226,128 155.930 69 "o 70,197 310 1896 240,14s 156,008 650 84,136 35 'o 1897 234,139 153,544 65-6 80,675 34*4 1898 233.359 149,032 64-3 83,426 357 1899 164,492 176,894 66-8 87,597 33"2 1900 29 1 , 1 9 1 196,812 67 -6 94,379 324 1^01 280,822 '75.233 62-4 104,788 37-6 I9C2- 283,423 174,395 6i-2 109,028 38-8 APPENDIX. 379 TABLE II. itent of the Value of the Total Exports of British and Irish, and Foreign and Colonial Produce from the United Kingdom, and of the Avir7ints ami Proportion E.tf>orted to Foreign Countries and liritish Possessions respectively, in each oj the Years/rom 1856 to 19C2 inclusive ; in thousands 0/ founds, i.e., 100 = 100,000. I-.xiiorted to Fore jjn Countries i:xporled to liritish Pos5cs- Years. Total V.ilue of Exports. only siODS only. Airnunt. Per Cent, of Total. Amount. Per Cent, of Total. £ £ ~ £ 1856 i39.'2t 102,525 73-6 36,696 26-4 1857 146,174 105.73'' 72-3 40,436 27-7 1858 •39.783 96,570 69" I 43.213 30"9 1859 155,693 106,042 68-1 49.651 3i'9 i860 164,521 117,988 7i"7 46,533 28-3 1861 159.63--' "4,493 7i'7 45.1.39 28-3 .862 166,168 120,744 727 45.424 27"3 1863 196,902 141.932 72-1 54,970 279 1864 212. 58S 156,892 73-8 5S.696 26 '2 1865 218,832 167,285 76-4 5'. 547 23-6 1866 238,506 181,738 761 57,168 23 '9 1867 225.802 172,440 76-4 53,362 23"6 1868 277.779 174,061 76-4 53.7-8 23*6 1869 237.01S 185,123 78-1 51,892 21 "9 1870 244,080 188,689 77"3 55.391 22"7 19'6 1871 283,575 228,014 8o-4 55,561 1872 3J4.589 248,980 79"! 65,609 20 '9 1873 3 ".005 239.857 77-1 71,148 22 '9 1874 297,6i,o 219,740 73-8 77.9'o 26*2 1875 281,612 204,957 72-8 76,655 272 1876 256,777 186,627 72-7 70,150 27 '3 1877 252,346 176,594 70 'o 75,752 30 'o 1878 245.484 '73.491 70-7 7>,993 29-3 1879 248,783 182,274 73"3 66,509 267 1880 286,415 204,887 7'S 81,528 28-5 1881 297.083 210,402 708 S6,68i ?9'2 1882 306,661 214.323 69-9 92.338 3o;i 29 6 1883 305.4.37 215,036 7°'4 90,401 1884 295,967 207,663 70-2 88,304 29"8 1885 271,403 185,979 68-5 85.424 3''2 1886 268,959 186,726 694 82,232 30 6 1887 281,262 198,992 70-8 82,270 29'2 1888 298,577 206,849 69'3 91,727 307 1889 3«S,592 274,756 7i-a 90,836 28-8 1890 128,252 233,729 71-2 94.5»2 28 "8 1891 .309, « ' 3 215.775 69-8 93,338 30-2 1892 291,640 210,428 72-2 8l,2Il 27-8 '893 277.«35 J98,554 7''7 78.583 28-3 1894 273.785 J95,'99 7i'3 78,585 287 J 895 285.832 209,760 73'4 76,072 26"6 1896 20,379 205,729 694 90,650 30"6 1897 294.174 307,209 704 86,964 290 1898 294.013 203,903 69-4 90,110 306 1899 329.534 235.285 7''4 94.249 28 6 190J 354.37.! 252,349 71-2 1C2,024 2S'8 1901 347.864 234.745 67-5 113,118 3»S 190? 349,238 231.727 66-4 117,511 336 38o APPENDIX. TABLE III Statement of the Value of the Imports o/ Mefcltaudise into the I 'niteii Kingdom, and of the Amiviits and Frofort ion from Foreign Countries and British J'ossessions, respectively, in each of tlie Years from 1856 to 1902 inclusive; in thousands oj founds, i e., 100 ;= 100,000. Import. •7.4^5 164,809 75-8 52,6;6 24-2 1862 2^5,717 160,434 71-1 65.2^3 28-9 1863 248,919 164,235 c6o 84,684 340 T864 274,952 181,208 65-9 ■ 93-744 34"i 1865 271,072 198,231 73 I 72,841 26 "9 1866 295,29) 223,084 7S'5 72,206 24"5 1867 27 5. IS.:; 214,449 77 9 60,734 22'I 1868 294,604 227,700 77'3 66,994 22-7 1869 295, .l 60 225,044 76 "2 70,416 23-8 1870 303.257 238,425 78-6 64,832 21-4 1871 33I.OIS 258,071 78-0 72.944 22 '0 1872 354694 275.3^1 77-6 79.373 22*4 1873 371,287 293,277 78 2 81,010 21-8 1874 370,083 287,920 77-8 82,163 22 "2 1S75 373.940 289,516 77'4 84.424 22'6 1876 375,155 290,822 77"5 84,333 22"5 1877 394,420 304,866 77-3 89,554 227 1878 36(,77i 290,835 78-9 77.936 2I'I 1S79 362,992 284,049 73'3 78.943 21 •? 1880 411,230 318,711 77 "5 92,5'9 2.«'5 1881 397,023 305,483 769 91.540 23-1 1882 413,020 3'3,589 75 9 99.431 24-1 1883 426,892 328,210 76-9 98,682 231 1884 390,019 294,206 7S'4 95.813 24-6 188s 3 70, 96 i 286,566 77"2 84,402 22-8 1886 349.863 267,979 76-6 81,884 23'4 1887 3*2,227 278,428 76 "9 83.758 23" I 1888 387.63s 300,723 77-6 86,915 22-4 1889 427.637 330,371 -.7 '3 97,266 22'7 1890 420,691 3*4.530 771 96,161 22 "9 1891 435,441 335,976 772 99,464 22'8 1892 423.79? 326,027 77 "o 97,766 23-0 1893 404,68s 312,918 77"3 91,769 227 1894 408,344 314.432 770 93.9" 23*0 1895 416,68) 321. '59 77"' 95.530 22'9 1896 441,808 348,600 789 93,208 2I"1 1897 451,028 357,001 79' I 94,027 ■.<0'9 1898 470,544 370,921 78-8 99.623 21 "2 1899 485,035 378, 2C6 78-0 io6,8.(9 22'0 1900 523,07s 413.544 79-1 109,530 20 "9 1901 521,990 416,416 79-8 1C5.573 20"2 1902 528,391 4^ '.598 7T8 io>-,703 20 2 APPENDIX. 381 TABLE IV. State inenl 0/ the Total Value of Imports and l\.xpo>ts 0/ Merchandise into and from the United Kingdo)ii, and 0/ the Amounts and Proportion from and to J'orcign Countries and British Possessions, in each o/the Years/roin 1856 to 1902 inclu- sive ; in thousands of pounds, i.e., 100 = 100,000. ■JV'tal X'aliie Imported from, Tt.tal \aluc In ported fr.pMi, 1 .. . . , , and Iixportcil to, Forcijjr\ and Exported to, Britiali Total \ aluc of Countries onlj-. Possessions only. Years. IiiH^orts and kxportb. Amount. I'cr Cent, of Total. Amount. I'er Cent, of Total. JL £. £. 1856 3". 765 232,042 74 '4 79.723 25"6 1857 334,018 247.399 741 86 6.9 25 '9 1858 304.367 222,540 73'i 81,827 26*9 1859 334,875 245,749 73 '4 89,126 266 i860 375.052 285,559 76-1 89.493 23 '9 1861 377-I17 279,302 74'' 97,815 25-9 1862 39 '.885 281,178 71-8 110,707 28-2 1S63 44S821 306,167 68-7 i;.9,654 3' -3 1864 487.540 338,100 69-3 149,440 307 186s 489,904 365.516 7»-6 124,388 25 '4 1866 534.1Q6 404,822 75-8 '29,374 24-2 1867 500,985 386,889 7 7 '2 114,096 22 8 1868 522,473 401,761 76-9 120,712 231 1869 532,475 - 410,167 77 "o 122,308 23-0 1870 547,337 427,114 78-0 120,223 22 1871 614,590 486,085 791 128,505 20 "9 1872 669 283 524.301 78-3 144,982 217 '873 682,292 530,- 134 77 '7 152,158 22-3 1874 667,733 507,660 76'o 160,073 240 1875 655.55' 494,473 75 4 161,079 24*6 1876 t'3',932 477.449 75-6 154.483 244 1877 646,765 481,460 74 "4 165,306 256 1878 614,255 464,326 75-6 149,929 24 4 1879 6", 775 466,323 76*2 145,452 23-8 1880 697,645 523.598 751 174,047 249 1881 694,106 5'5,885 74-3 178,221 257 1882 719,681 527. 9'2 73 3 191,769 267 1883 732,329 543,246 74 "2 189,083 25-8 1884 685,986 501,869 73"2 184,117 26-8 1885 642,371 472,545 73-6 169,826 26-4 1886 618,822 454,705 73'5 164,116 26-5 1887 643.490 477.422 74-2 i66,c68 258 1888 686,213 507.57° 74'o 178,643 26 "o 1 889 743, -'30 555. '28 74-7 188,102 25 3 1690 748,944 558,261 74-5 190,683 1 25"5 1891 744,544 55>.752 1 74'o 192,802 \ 26'o 1892 7'5,434 536,457 ! 75 'o 178,977 250 1893 681,826 5". 474 75"o '70.152 350 1894 682,130 509,632 74'7 172,498 25 '3 '895 702,522 5.30,920 75-6 171,602 24*4 1894 738,188 554.330 751 183,858 1 249 1897 745,203 564,211 75 7 180,992 1 24 "3 1898 764,558 57 .825 75 2 "89,733 24-8 1899 814.570 613.492 75'3 201,078 247 1900 877,448 665,894 75 '9 211,554 1 241 I901 869,854 651.162 74-8 218,693 i 25-2 1902 877.6 9 653 325 74'4 .•24,304 25-6 382 APPENDIX. Q, t. s U5 S i C3 «;> t. 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J \0 M ir, O 00 M On N CO N t^ N On ^- W fn N -J N OO r-. ^ 00^ ro in t-^ r-- P3 rr fc- o « « fO -^ -^ r^ vcTno t^ lo in rC •^ CO M xports of oreign and olonial roduce M IJ^VO COO On ON M m m 00 «\0 ONI- M 00 « VO ■* vo O onO cnN H vo in N o3 On ^^ O; ui N o> -J inNO_ o_oo_ o_ o_ On -"J-CO t>^ M c^ m ^ iri ^ ^ no" NO tCNO^Oo" no" NO inNO tC W u, u^ 1 N m m 1 lil « 'p CO _fO ~ On oo r^ On JN m NO co_ p _M yi N 1 ' lit. \0 VO t^ t^ t^ t^ t^ fv. t-s r^ 'i^ t^Co vo NO m ■i) .J 00 0\ On ro -^ onno 00 ■'^ (^ CO mio m N^- 1j- H 1 t^ ^ OnCO O o> en r^ ON ►- m r^ in in d o ^ m in M - ■.^ "> °,^„ "t*". m e •4- -t'O tC tC N X? ^ «" o" o" ' < 1 00 N Cl « N N " ' ~o^m~yn^ ^ ■* N NO rv On ~m 1^ ♦ m CO tNx ^ O N OO N tC otT r^NO in -N? tC OnOO On C> On no" y. < « N CO m M i-t m •«■ en m m ^ ~ T i2 X u oo m * N lo ~m >»■ On OOO m - 1^ 00 N e* f* e< ■«»■ t^ lO -^ t^ ■* Ht 00 NiJ- in On ■* ao'5'1 V.j ^^ in t^oo -J- ^ •*nO_ n c» n "t! .p_NO__ ■«; in On c^ o W «£ ^ in d" « « o" tC m" tC -N? rn •^ d On OnoO^NO W fO N « N Z' On r^ invo 00 O M OnOO ■«• „ moo m « cfl 00 t^ NO m m N fN^ On in " m M ^ ^ ^ ? ^^ 0_ m -Nh moo NO CO t-. o_ M_ 00 O O On O t^ ►T ►<" c> d o" On On On M C* M u. uci, "^ MM MM in m %lt Ol N M H _M « m p .«^ .0 p VD ■»!■ in On copO V° 1 -£^ *N "romVV fO to CO ro V V CO CON coVcO m «^ VO M t-, * M On w On in inio r^ NO •♦ On t^03 H B 3 M mo in r^ ^^^0;N MNO lO C^ t^ On ? rnNo 1-NO Tf On ^ ini» rn m ♦ in NO NO f« T^ On On E On On m' m" m" ■Nf 00 NO On <; < H ■* M M w in ♦ 00 CO t^ ■* m N 00 •^ OnoO I*v oT CO On OniO « 3 t^ •* mio Ov 00 5 On r^Na C« 00 t^ in ■<■ in ii ^ fo ro ♦io'no" 00 inNp O; r; 0_ M M mio On m lONO-oooooo" <> >0 -VNO t^ tC « CO m Lhl| On r^ I^ On On ^ CO O tvOO NO •0-n5 -fl-OOCO On mm g c«NO no m inDO l^ tN. •«■ * On 0_ CTn ^, r-. rn On - 0_^ ^ ro ro cf m ro ^^ moo_ in o_ ci^ .-^ M S«o £ m" n rT « CO W U. ua. *^ ^ ^ r^ ra M N ro -1- in ^ i fe C NC 1^00 On O O 5 \0 txOO O* Qi ,« r* t^ rs. rNi.o5 2 rt NO NO NO NO t^ rtX y t^ t^ t^ 1-^ t^ rt^>< 00 00 OO 00 00 >. CC 00 00 00 00 >^ 00 oo oo CO CD' o " > o " > o " 5 r u; "" u APPENDIX, 383 j s <: >p p.a) p - p- V "C' ."^ ."'■ V' .■" Z- .-.;.-.-.;^ "^ -^ ■"»■ ^ ^ -»■ '-«■ p c 'm 'm m "* 3 n h ^ WoD (S p t^ ^ On ~ p m t^NO t^ (^ t^ CO en 00 ct 00 00 00 'tNOOOO On'o •5 .-I- - .-r 00 00 _M m_N y^p ir-i C SO "0 p p. p ,••)- p t^ mp C CO - "-»• "1- '^1 "■«■ '-r p •:::"; < J X d, g 3 1 •< M ;'. _f 1 f. CO "in 'm 'u-,x> \n r1 ;i ov M 00 ^"ino 'inoo 'in \^ p -S-p .►" p N p^mt^y p. m •«»■ in m in m "m -1 mrnmiN - b 1^ p p 1^ On m "m "m in 'm 'm 1^ _ri m p p _o> "n "ro 'm "'»• "* >o ■|rS P m p\ ■* in H 00 '^ CO 'o\ c> 00 00 00 00 00 b\ b yioo _M 00 * OnOO ON30 t>. mpNp •♦On 00 00 00 "oi b NO "o>"o p NO I#|J .* o> _* p p ■ inb b 'm "m *r^ p .'•-.-♦p p ■♦ '-r "•♦ ij- •♦ _'«- p p ■" 2 < u 0: i < p>p ;*-,-*p b> '0 b b ■*? o\ "0 ^ b V~ ■<■ inoo _r> ■♦ ^ ivoo CO 00 vo b b\ b^ 00 CO ^t^ :« « b bi ON On p "o- t^ N On r» _•* on"o b b "m "c _m « m M ON M '« ■« "o •m p m p "0. ►• b W '"^ '" b « N N m en _r».t>oo mm in in 'moo b> .0 00 ONp ^ ^ On OnoO On CJ W M c< c* ro 'on p p mp m "■* "n "moo 00 mo mpp N M N NO 00 M N C4 n N 00 •* 8 m m b ce-j — 00 p On NO X "~ c NO bv NO in>o 00 « b M M Vj ■« v~ M m ■* « "m "w "« "« ON b r^woo m M '2 '2 n '2 m NO N "0 "0 8 S ^Ih «. 00 y> U-, m !>» •«■ _•» p NO r^ M N « N N "p "n 'fn "tn '■«■ > >o On CO p.'C, •* "-r'^ j "m < ^ b-M V^ c^*b to b> * ON t^NO 00 NO NO t^OO 00 00 M o>.-«-m.i~« 00 CO b ■« "o 1^ "on ■- M '♦NO NO ?? p b NO N 00 N "^i 'in 'm 'lo V ,pp ^ m « M « « Vo p ,t^ » rn ."1 p '■♦• 00 m p p ts. W"m V>n Vn n Vn'm t^ r OQ 00 00 CO 00 c t f - « r NO r»oo On c 'v^ 00 00 00 0» 00 00 00 00 00 — ,c t- -5; r >4 N m ■»• m 0- 0> 0> On Ov"- I R > »p C^OO O- Q^C " " " " " 2 H ~1 > 8«| "is H -a c 384 APPENDIX. " S c c S o loll Si o -J > 'til g 25-S to •is 5 }• VO M r^vo r^ vo t>.iri t; M tC tCoo" rCoo CO 00 OvO m m 2S??S 00 txvo vo vo IX ? to Oi CO VO o.'o'il fO M rN. N N rooo »-. ^o t^ 1^00 CO "-I e^ in ■ rr 1^ in M o o vo" t " °. °. "^ 1 O z < 1 Hi M CI foco p M b b b^bs b 00 p I^Ov^ts. M Ov Ov Ov Ov b m w 00 pxoo M b b b bi b c 1 < f^ w -4- r>* m OS CI N- r^cxD ".^ in in ci^ Os so" f« fo ro i-T W C4 C< C< « CO 00 « >o o> « 00 O OOO Oi fnoo c> tA tN. O ■vfvooo M 5 vo o-m Ov o vo in in Ov S in-«o vo* tC M M C» M W ! Ml « N " >" ^ VO OvN 1^ O vo Ov t^ in N_ « w m m 00 rC tCvo in Ov O woo ovin vo ■^^ ♦ » in CO f c ^ ^ t^ « M On ^,03 &;oo 00 rn 3"2 2 » 2 i « ro •«• Ovm "2 0_ Ov 0_ Ov V? •«• M M Ov IX ►« m e^vo o Ov ■^ t^ in m 1 «8" , , ■o t^oo o« *, ooooenoooo- u 3 ~ V 2 - 5 3 M M m •♦ in, ** t^ t-^ t^ t-^ t^ >« 00 OOOO OO 00- M M M M M 2 K vo 1^00 o.p>2 n ^:S-Z '2'£'S; 3 > o > Appendix. 3S5 5. .^-i ^ "^^ *m « Vr V* "*? b b b b b « « « CI ^ b b b b b 00000 o 00000 VO VO m»0 tN. IT) o ^ (^ m CO CO Ov mo « f< 00000 00000 IS 1 5f 2, s o 3H ul B •=■? 8 a 3i! . tN.00 CO r^ fn « « M « N « fn c M w « N « 00000 t^ r«*oo fv t^ \0 t^ o^ t^*o mm'*- 'if'O N CA -♦ IOJ3 3 ^ *^oo O^O.O ei MNm-"*- »r..o (1 no t^co 0\ ,0 (1 ►< n ooooooeo*^ «*> oooocooo a«^— -, O o On o a> On'— dji' q*Ono&-c^"*j*' Qo oooocooo-2^>« oocx)woooo^^>« ooooooooco— _2> aSooooco a — _n >" '^ ^ o> o> o> o> 3se Al'PHNDlX ■CO.-- ^•^^ s S"- 1 > = "S « 12« ^S^ wtr^ <=><: li'> ^-S?, ^t- S -a..« *i >■«?; JS "3 %* e>^-C z istij ■S 3 D OS 1 6-1 b b b b b b CO M Os^o ^0 b M b b b b invo vo ,■♦ H b b b b b b B g ooo 00 m u^ S? 'I "t *1 t°°. vo ^ - p^oo 'O m t;oo CO ■«■ fo in o" vo >o •O « 5> O 00 -^ ;p t ;i ;: ;j 0_ ►- vo o t~ m ovo rv -t M Ov N m r^ m H M 00 tn M N r^ 00 vo ^ mvO U-) Tf O vo ro f^ t^ f1 N >»■ N N N J s H^ 00 M ChC>,^ b H b b w p 00 « H p 00 b M M M b b oo >o yi ^'coo b b b b b vo b 3 i < O ro '^ -^ r-^ t^oo in o t^ M M « ci n" VO N m ro tT n" ! in M r-i o-vo 00 00 ro -"l- ro -4- 1 00 »n M I^ M ij-vo m ~ « r^ « % On vn M O* Oj o ^ « invo m o O fO CJ t ■* fO 00 0\ 0^ N ON tsi M O '^r vo vo J N < C3 H ^U M \p -^ p ro f o in IT) r^ in ■« « N W M *W y> a 3 < 00 ro c> M ■* '^ ^^^ "t ^-. *C? in in N tn rx c< ON vn^o ^ (o "»^^ "^ ^ *■? tC in inNO u-> rs. N r^vo N moo r^ ■* 1-^ in ts.co_ o_ M_ lo" fC tied" tC VO vo ONNO in m onoo m a ■* w Ov ON to •«- >noo ov vo rC fC f^o pn N N 00 m vo vo mvo vo 00 Ovoo tn N « in t^oo 00 O* on in\0 NO M -^ N m m -«j-so m N 00 « 00 M o> 0.^ « e § -o rooo t^NO r^ ^^2 M H M HI H H t/1 Q U H s p 1 '^^ c c < Vo b M "w •i;^ vo vp CO CO ^Oi 'm V M b 00 p 'in. *rx 't^ b 'm ^l^ll^ 1 ol'^ ov mvo vo_ 5;-0 M 0_ fn •«■ m m « oo h. >n N 00 N ro t^ fvo •i- 6 r'.oo" m" fn ■«■ m « N M Si >o_ r^NO « On -*- d" cf* t^ >n t^ « w M « m «" i^ too t^ r*^ oo" -." m' 4oo" M W W M « m r* in w in o> oo" ov uu.Ua. (^ ro « f^ 't. '^ rn m" ci" M M ^ m - -*vo f vo t^ N Ov<3v ««• uS rn CO ro cji Oi 00 Ov CTl rn in O; 1- 5_ vo >0 vD vo i-~ ,, « i^ t^ r, r^ t^' oooooooooo-^^> cocooooooo- ^1 ^ s o " " t « vo t^OO O V w r^ r^ r^ r^oo ^ CO 00 oo 00 00' A1>PENDIX. 387 1 1 m •♦ m ♦ ro b b b b b b * m _♦ _m .-)• b b b b b b ? b b b b b b b b b b b b b b D ^ b " b - b •; p 00 m _►< _N ■« b H V- " •: - ^O^p 00 ■" b b b b •: p 00 0\ Oi M M b b b M t^ r P in 0^ •: a 1^ - - b b - '- ■- V CO 00 in ,t^ - b b b b 00 0> r-oonj b b b b '- * p> - b b b p in a'o S = S^ '"^ b b b b b b b p b b b b b b b b b b b b b 1 *"f jS " b b b vo CO 00 op b b b '" M b r^ -)• o^ o^ N b M b b M 'ii a 00 -0 r^ b b b b 'iH b p o- '» b b i s ■< "-^vr-^n N- - V4 ■« V--, V, P" N p p .-*• .m _t~ t^ ;-*• pi _^ in « w M fi Vn P" ."* " in p - M .» V N 'm "« M M M •p p N p> .C» P' P .f^ * ." ."^ V in_« _t«._« N N N « ■« m " tn « b p S 6 is _N N « M - '^ b b b b b b _« _N _N m_N b b b b b p w ro N N N b b b b b r _N N N N _m b b b b b .- b b 1 c 3 9 s < m ■<■ -r, m « .m ♦ N N M -^ r^< 00 M P p-'p t _1^ _0^ N _c^ _r^ P c^O ro ^b 1^ i^«b in _r^ -»• M 1^00 vO vo vO ts. •P m ip _N J- 00 -p o) « 00 V^ w t p _i^ yt^ w e^ inio mio pi b bi < 8 •gS -p a-p .10 _♦ p - 00 _m M y> \0 m*0 vO t^ P" mpoo in 11 00 t^ t^ r^ r^ 00 m _t-._*_N ♦OO b "mb in in i^i M J* p "-^ b b b b b ^t^ _f^ r^ rn ^in -n b b b b b r^ fO ^m m m rrj b b b b b •m _tn_tn_m_« ro b b b b b ♦ b b r h .1- p p .- y. _c^ p ;' CO p. - V ■«• Vr, Wl V p m '-»• M '- 'in ■? no .O-.t^p .>^. b V« bib b b b V. P •< !- CO t^ r^ tx M f. (»> rh en ro p ip f. M p^^n V» b M "mo 1 p ■♦ t^OO M ■- M 'ui b V p .oyip m N 1^00 in r^ t* k i" w m W M N >p 00 ;n p> m p Co b.00 b '« « « 01 m fi in in CTiM p t^b Vroo 00 f^ V ;* p t^ « 00 b Vh Voo Oi p « « Si p 1^ fo m M ■»• 00 tN. mvo ro b b M CO V 1^ _in p^oo p M "en '■«• ~ ■« b S ip pia> i> in ^ 10 mio f^ b mm p 00 00 00 00 00^ 00 00 00 00 00 *■ ,< r ! r^oo e. Q , ' 00 00 00 03 S''- 4 00 00 00 00 00 - ; t 5 - u 3 « N fi ♦ m. 3 Z c 3-5 5 " 3 10 1^00 oi 0. ■ i u 3 In ■a a APPENDIX. <: o o £•0 11 1, ;~ - 2 > •«'■? s ■■$£■- 5-g--^ U hJ ^S^ y. CQ c < w a. 5si --J ^ tv C c . K %* ^ S c J;": .<> _•« - .. 00 CO Jt^ 1^0 .'^.'^yi vp \o *o NO 00 r>. VO Ov r* fn « Cd N b b "cnV. *M 1 t^ r^ tN r^ r* tN. 00 r^ t^ tv t^ r» 1^ B 3 00 ►• rn ^ m t^ 1^ ts. r^ ■* M ■♦ |v^ en H '/■, ro -^-vO C< 00 ■* ei Ov Ov r^oo rs. r-s •* " ^ OCO 1^ Cv V^ « N ^? lAoo" D s" 00 CO Ov Ov -J- vovo" rn cT -^ s N -)■-'. M '^ 00 c^ t^oo u Z <; Ov « M « N N M n » M M Ov fi -"^ 00 « fO M N VO VO PI VO 00 ■+ VO " CTvvo VO 0\vO <-• 00 l^ « <^ r^ t^ 8 u 00 r^oo N m r^ qwo inco VO a "^j^pis^i^ in i-T inoo tC n" VO inco VO t^ CJV r^ Ovoo VO m r- w «£ VO CO VO < 2 &,«S "1- r^ ■* -^ -• ^ o> r^ M VO CO 15. r^ n- m M o«*--5 ^ c:_£ v^ iri c^ N « \c ^ 4 m vo" t ". ° t "0 VO 00 VO 00 r- 0" rCvo" m" tC -f w u. uj; •^ -^ ^ ^ -^ ?; in in m in in m •«■■«• in m " uj _-«-_n-) in-p _ro CO N U-l M N vp M M M N CI CO W •^P V< '« V, "0 N '^^ M "... Vn 'm Vo M cnVcn 'ci 'n Vj " *-■ *^ •-* C^ 1 Z 3 „• w VO O-OO VO M m i^o3 "TT 00 VO en « ^w~ H VO CT' 1- (5 tC 10 u=i 0" r-* l~. 0_ N VO t^ Q VO m Ov ■«■ c>Q0 t^ in t^ 00 00 m'oo" «" d^vo" tC en in « 0" -i^ 'O" U S lrv = i=- VO r^ -vr -^ •«*■ °°. t^vo^ -_ 0_oo_ H >? 6 rt~ tC rC w tn ui M M CI u"^-3 t>»oo xTi t*s ^^ t>* vp c^vp in pt t^ OvO « « .en „ 2' tSo b b b b b '0 "0 b b M M M M " ^ '<^ 0^ t^ ^ vO r^ ■•*--*- -<*■ in O-vO CM1 00 fS \o - 0\ r^ v«- f 00 VO av ^ ;^~2- M- !? !? t^ - 00 CO m t^ " T '^ CTvCO a r* c^ -t- < < ~ ■ " i2 jz H ■«■ in m w 5> •<■ w en "m" en envo 00 M ■< 00 VO 00 00 VO in 5>vo_ « •* VO en " en 0. '-^^'0 1 "f^. ^^ qv q "_^_"0 c<_ tx tN. w" i-T m" «■ cT oo ci M Ci" ci" en W -£ •" •a.; o^r^Cc 3 1.^ - 2" M - M N VO ■«• « ■* 1^ Ov t^ c< m in o> in M tv. On VO 00 CO cn VO c^ i 5-2 "5 fs X c '^ ~ ^ w u. 'jj; " fc, '-'^ N _<^co Ch'p 'O _■«- CI vp vp 00 .Ov 00 00 vp « pv P' p. =-° 'w '« N 'n 'ci W M 'i-i "1-1 M ^ ut^ t ~ J CO « VO ro 10 t^ f*^ r^ M vO_ c^vo 0\ ft \rt Oi E in inio io>o 2^ ^o vo" in •♦ in 1^ CT. - -)• ■«• M ec, S,vO VO 'C_^00^ h; CJ CO W <=£ lA ■♦vo-o'-o cf VO VO ^ ^ ■* •* 1? en ■* in " 00 ■«• r^ f^ «§ 00 VO ^ « Ov VO -»• rn VO ■S-gSSvS, r% M n M n X CO -»[«»•«• ■♦ u) u, 00: M /- r^ -, ^ -■— -s ^ , u *■ 2 t. U *0 rvco t^ i ! - « en ■«■ inii 5 VO 1^00 »■ £ a «5 ^c *o VO t-^_ J u r^ f^ I-. 1^ r^ U r^ e^ r i^co J^ > !•£- » Uj x}mooo:>- J b APPENDIX. 389 Ul H z u y. u a( < (- (- 1 f2 00 a> •>■ fi Ul bib bi'-i ■- •0 t^« t^ t^ '0 '0 "m '- '-■ 'm -f -J- ■«■ ■» n 'o-'o 'Oi'- '- 10 r^ ^ t^ t^ OO p tN ♦ C00>0 jpr vo p 00 00 t^ b V) in 00 rs, pi^ « t^ M ^in b Od mb 1 *in M M iH M M r^ m ■<• - IN ■- 'n b "mb in ■»■ ir m p '0 p in pp-p M 10 fn Oiio \o 1 fn m m ■«■ 1^ Oi 1 m r t^ t^ t^ r^ r^ in ov v,^ 'in '1^00 in b r- _r^ -j-vo - ■p 1 ■«• fi b 01 r-* 1 »n m 'f- p 00 *^oo 'n Vi 'm r- r^ p .-f m m '0- 'ro Woo 'm 1 '- ^ m m 1^^ m r^ 'o- 'r-. ! 00 ■^"^ i J. 1 " ■T; S 2 z 8 z u 0! B. Hi Ul I H C y. < a. < I 3 (- 00 00 _o> - 90 Vt Vi 'm V N ? mVnVj-i 'in ."" ^* in 00 p^ T^ -•r 00 ^'«^ oipi M 2" * M « 'S ■^ .0 m m •»■ p 'm i •< m in 1^ w ^joo 'on ■- in rop ip ^t^ 1^ 'moo '« '0 b p. 'r^ 1^ p ~ p m V N '- '0 '- p^ 'oi N p p M jN -J- N 'm 'n r^ ■^ ir ir m m >o 00 'n m m '0 8 *g Oijnip M p v,j 'k mi) lb b MOO (Mn - S?'in'ui-.n'in.n M ~ 00 p^^ p 'mi> '-a-'-a- P( CO r^ M - in -f in b b "8. 00 M p _m_-«- p, p _- m ,-, m 'in b 'm 'm M 00 r^.-rp _N 00 Co r*. 'm '•< en o lO 'oi 00 _r^ is 'm m •m 00 1 "'; •0 c S H e ■< 1- CO O' OvTO '" b b b b 9- b a -T •«- m ". 1 fi b ■- 'm -. ■« 1 ■- 1 p .-- .ri .- ,1^ r^. " p ,r^ ,m ;o 'n 'ci 'm 'n 'n •«' ■:': ■J bC c V M .*>o lO m "nJ m « « ■« ■« p 'n '"-. '♦ '» '^ 00 "m 'm'm ■«■■«• 00 « p M « pi vo is moo '0. m N m p 00 « m M M "^ Vv V. V, •« •« « _M ^0 Oi-i 'm 'm'^'m'-u- p p m cv t^ « r^ fn m '-r r^ _" 00 p p t^ ■0 m ^ r^ a» -.-1^ ..., 3 _m m -n m M ■^ b c b b b ^ b '0 '0 '0 "0 .- _N rn N N _-. '0 'j '0 '0 b P _M N r. m _« b b 'c b b p b b .;: * 3 ■i < - p in in p t^ p .•«• - p ~ « p _t^ _t^ p p moo t^ pt -p ■« 'l-l 'ii '« 'm 00 N w M p 10 'm'm'i~>"m p. p - '« 'n p « Oi in _^ m « ^'f- r^ ro f< 00 mo 10 mio '0 moo tvp f ■b m'«-"*'m p 'ts. 00 '0 TO _« b "t^ ? <7><0 n M N f«^ ro m N ro "^ b b b b b ■: « _« N p vD inb i 'mb '0 '0 '0 d d % b "m '♦ 'f 'm '0 '0 '3 "0 '0 -b '0 .r^ - p m -o "m 'i^ 'm "01 IN. M b 'r* b b ^3 _tN b Mill b 00 ao no OO 00 **■ H •si; > « >— M r>i -^ r^ M O LJ^O 00 « lO O ^o"« cToo'o* N « « M M N W W iH -{-C O O On t^ * 00 fO « ^O CO ■* 1^ O tN. %o fo a^oo o O m r^ ( f-c-n^ in M CO o* ^ 00 00 (^ r«.o oi oi cT 1 M 00 « ^0 N t -^ iH VO O W « M » ^o o -^ • tC Cs c? O r^.<5 ^ t^ r^ 0\ o^ inoo \o <: o t*^ O O ^*o O oo 00 00 t^ tN. ( tN. O 0*\0 vO oo ao « o* r*. r- N On'O CO ro ui rooo I ON ro (H « ( «" ro ro ro ( 00 o oo Ov o 00 •-" r«.oo »o I 00 M IN. On ) ro O '1- «<- * M 00 O; w_ o CO cT cT fo oo 00 r^^ 00 CO m r*. m Q» m M CO -* O m^ ^ ^ In. «0 ■♦ Ov tN. O \0 >0 m^C 00 *o t^oo O^OvS si «-«f^* tn,^ n \o r*oo Ov o *£ Jl Q00ooooo-^z>i oooooooooo— !:>• oocooooooo— J:^ MMMMMrt*^ MMMMmC!-^ •IMMPV^t^'^ P-IMMMM^^^ WMMMI-.^^^ ^^•^^^^wjj O ► O > O > H £ Hi ^ £ APPENDIX. 391 < h 2 I . i 1 c 3 i b b b b 'x 1^ b b x x '2 '2 ^ 00 p 00 _<»i a. b b b '-- b X •♦ in « tv 1^ b b. b 'oi mpi b V> 00 0 X 10 Vm Vj> V> iri v^ 00 p mp p b 00 b M X '^ r^ in

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X ♦ - 'in'mi r^io p> ia b 00 1^ r^ 00 b X X X U i> m 1^ 0000 00 00 on 1 0000 ooooco- 5 5|-' ^ 3 >0 l~.oo CT. Q U 00 00 00 00 0^ 5 3-5 J-. g M N m ^ in ^ 00 OU 00 00 OS V X X - « - 5 Z •)• i3-5' ^ M 00 CX3 00 JW O" 1 Z t»K 3-S' 3 Q M 5i H •0 a 302 APPENDIX. — ."^ o S" 5 b ? o -. ^11 1 ;="^ I— < -^ ^< ■^ "^ w _ ~ ■5; <" S " S H ^^^ ' h <= cod ^-5 = £'^ 4m t/l s!3 88888 8 88888 8 88888 8 P, c,^ — 71 Jjt" HO a ^0 M Oma M •Nl- m CMn « „ I^NO •»«■«• ■«• 5^ r^ - CO r^oo g m M >n in o_NO NO r^ ■♦oo 00 »- H c cnoo t^ 1^ m ■«■ t^ Tf O-il ^ro i/^ tC rC -^ rn 'f ^^ rC ►T NO « moo 10 On U^ E •< t^ 00 M « OnoO « N N M N N rl m N N ■^ W C« « W N " z? " " " — -r" 03 « OD •* 1^ CN 10 1^ inoo NO N Oi moi N m wr7 r -gS M vo r^ loco o> NO u-co inNO tn X)- r-v& •5 "'" 0\ 0^ On »a 0_ N. -_ N^ t Nooooo in S On 6? "■2 OW-- a K ** 00 00 t^OO ON On cnio in ON rn On Oi ON N I w t^i On « W M CJ « •-■ M M d .a " -^ 2 C B f^ 00 M M M -.^ ~ c^ « N NO On 00 m in ~^ •«■ CD -»- On ^ d; -fro tC * c^ c^ ^ 1^ t,. r^NO 00 NO S (« S.'oll «proin cj ^O I^ « 1^ m On N m in w 00 On i ON moo rn ♦ 00 O; ci^ 0_ «_ -? S\^ '^ in H ^ m 0; c>od" m" ^ i-" o'nO cT m" J- rC s W *a; in ^ "v ^ m ^ inio NO r^ t.* rn NO NO NO NO t^ m (a " c re g 00 CO CO On t^ N * On fn 00 M 0. mio m ■♦ «<: !- H '0 1^ ON N m r« 0.. g c^ X CO 0_co_NO_ in ■^ in -n 1^ ■* f^ r>- (/) p. a tN. m" cT ro m" ►T m" 0" 0" " ■^ m m » d t^ m o> « , ^ in m c^oonO S^ M f<^vo 00 vO M NO 00 NO ■* CO t-^ N 00 moo « I? Ml t^ •^ « fO hN t^ r^ r-» moo r^ H \o 1^ t^ « « ■«• M r^ ir mio 6\co cC «C d> 0" «■ cT 0" •«• OnOi 2 u "^(C ■* in MM M m pa 2/ Cn t^ On ■* M m UNO ■*• ^ On ■♦ M 000 „ S S3 n ■«■ c^ t- NO « t^co in M On On M a 'C CJNCO cn <3nC?i Oi M fo M M •»■ M M in U) U. UP, ■^■■^^ v.°-? NO CO r^ l^co r^ 00 rnul^C o^ '^ 00 CO CI m C4 D ft. =,0 "0 b "0 b b b M V. ■« ■« M M CI Vl Ct "0 7. u^ < 2 c t". M m . ,n5 \o no -NfNO S^ -t OnnO *C On Sn in ♦NO M M H 0- ■<■ m i ■«■ moNONO 00 m r^ N 11. NO rn oiNO t>. en NO in ■«■ m c« « < 00 ei" en •^^ ♦ in •«■ •«- inio r. 00 = J M n 0:== - or- Hi m M C« On (7-0 m - 0^^ m m ^7, , , onOn ONC^ in NO M M in m SJ r-,co_ in unco 00" M 1^ m m On cf cn » •♦ •» CT. m M o»oo NO ■i -i -i in-o" oo_ M. f< Ul Hill , , M ■♦ 0> ■* N-o t^No t^ 00 r^oo M M « 00 M 5 ■•• t^ in c^io t~NO < t^ ■? \ W U, UA« .J^ " w / .^ ^ ^J — -s . /- •«^w^ 10 t^OO On V 3 3 « « m ♦ m,; 3 2 ' \ ^ 10 r^oo oi OC y 1^ tx r^ 1^00 \ s o NO 10 S. !■£' « t^ t^ r^ r^ 1^ 3-S' "si H OD 00 00 00 00- M M M H H J n 0000000000- U " " - *» " l_ 3 > ( } > c > > t * t :: ^ * b : t- £ APPENDIX 393 Utf> 'o_- 88888 8 88888 o 88888 % §8888 8 88 8 ^2 a. c,o "'""'" " j: c *i>.MD in in " i) 'o.'- Wmm ■^ mN p m.«- .■» 00 _M r^ g « w n m m m m Si^ •< •^ ** " "• |p c -c S p y>oo p .'^ * _o>'p Oi in M M Voo Vn m .« M N p - r% .■«• p .-<■ b m -p fi •«■ m m « ►J* " " " " OO i s ■« i^ - NO Ov ■«■ N /r _^ p t^ P% „ o> ■>»• ooo t«. 1^ M O \o N 00 OO 1^ ti o « "5 -c = = >o o m m mv5 >o o m m lo >o m m m m t** ui ^^"^ "T-- ri ~ -O CO in O •O <** 00 r^co vc N CO m l^'O 1 - •o m-c lO OO r^ m'C 1 1 u *; iS O o> o> - O CD OO C7, N m OO in 1 U .i; c t^ ro * ro •«• M M rn iN-oo m ^ m N 'OvO M 00 lO " « o> M m M p i \D M O 00 ITi fr N « M •«• M m M ooo rv cv tv rx •< ■«■« in o> o> m m ■«■ N m ■<- 00 ooa>o5 t~ •o m m •«^ m r^ in m ■«• « « m ^ m t^ ^ .^ r* m Bi n .-1 ■< ^ * r<. l-oSllI mm ov ♦ m VO lo o. m m - o ■«■ m -(-OO ov m m c^vo lO tN. m m O h O r^ i^^o r^ r^ VO •O lO r^ «^ t^ m i^-o 'O m m ?> lO o o o r^ m 00 OO NO h w i2 (5i " ^ °-5 p 'p _t~. p - o- mNO vo C4 lo VO o mvo OO m o> t^ o ■»• ~ m f. t-v N 1 0~ o l£co m CO ro ro m m m m m m m mm T •«■ ■«■ (2 - in g t^ O rooo « o> •^ « t^ « 00 m •» m - r^ m m 00 r» t~. « ■«• ••VO O^ o - >• ~ - o O M n « o O m ^ 2 X % "' m M M M M M NO ■* \o omin M •<• n - VO fO m M » moo ■«■ r^ 00 00 om •* „ H S ei OO 5, 00 OvOiOiM ** ov o» oi Oi " o>o - <;; J Oi c g, 3?! ^ I°-P|l .'" ■„ M ■« b b p P N 00 p\ pi - V. b b b I*- p .O- - ,n N ^ .■^F> _tv : w u. ui y. m ^ « 5^ y^ y^ '« Vt M M V. .0 *pv« - p « « « mm OO p> •♦ _« p fJ '« "m'mV M T p..'* r»p m '■• V "m V V IT. t^ ^* ■~ j2 c i^ « m ,-■ .n >o in -^-oooo „ i^>o •» ■«■ ^ CTi ■«■ M M VO -t o ■— o fo in>o 0^ o m 00 00 o> Oi M 1^ OO « **« ^ 85 « inio ^ ra „ mo o M m 0>O ♦lO HI lO 00 ■«■ M ♦OO VO M ♦ OO ■A t^ r^ •«••«• en m in m o o> m so 00 00 00 O m •* m m M - « >? r^ ■<• ^ < ♦ m in moo r^ 00 f»iO 00 lOOO m - o» N 00 00 U « O o « O O O m « - o - »o „ CI „ lu u, ua; " ^i*^/^.^ - ■ ^^ . ^^ S 12 fe c j_ i" - u " "* c •i 2 ScS-S 1 a« >^ .*i ^1 394 APPENDIX. 5 'J >o''>o" -f 0' 0" 00' 00 "I- 5\ « m'vo'oO cJ. CO 10" • > a. D h ^:p 00 Y%>^^ N M w W Ci « "n J- in-p 'p 00 '« M M M W (^ p f^r'.o .0 '« M M M ■« ♦ < N t^ tN. IN. ts. ■* rn n-1 -^ m 10 -"f^r r^vo" I •<; C^oo in "«• N 0. ro .«■ ■.^ in r^ t^ t^ iroo r^ ^00 tCvo" -^ rn r^ n 10 < ^1 fO « _■•*■ -^ ro c .1- .c< p p n - M p p^p^ 00 H ■« b b b p> b N cj -4- t^ f 0-. ^ -t m w in ro rn ro lO « 00 xo ^c ■^ .f m rn -f 0" « M « ^t- in •«• u 2: < ■i •^e"^ LT. ro ^in ^(^ -^ p M ChH M ■« ■« "p V; H M b b M c i < ►. m 0. N Q tC t^ m m rC m ro m m m r^ OS Cl in en o> oi cj t^ in r^ f^;co m •.*- in in « 00 m" i|- -"T .«■ en ■♦ 10 C3l D .-1 01 ca ^SH t^co CO N r^ p f^. r^ m •♦ p t^ 3 1 < r^ 10 10 « 00 miri 0^ •)■ (^ OM/-1 n ro 01 m M in 0. N c5; 00 r^>o * ■*oo 00 cj in 00 00 en t^ fi rn m" cT 0" ►•" 10 c z < .J <^P V Vo 'm V V V N _r^'p p'p V m 'n m V p. _* p 00 p rt Vin'mbi) •:^ c 3 C < 0\ « w OsvO ^, t-.00 n r^ ro N •«■ rv M w -^oo vo" di "-^ "-T in < a. in p N _N _« »0 Co VO Od li^ >b CO ■.^ -J- ■+«) t, 'P r^ ^-* p o» vo i < 01^ ro -«■ .«• 00 l^m V^ <> »^ (^ ■♦ OnOOOO 00 tA 1^ m CJ t^ t^lO 10 m « ♦ m <> (> ai ci « 8 8 in « mio 10" 1^ i -• \0 M 00 MD 00 VD 00 Co iaCd 00 (0 w 1^ ^1^ jLn txi) 'min'm -b t^^ 00 _■«■ pi V 'm V V 'm N 00 in r^^o s en M f*^ C?i rn * i-" 0" 0" N OD 0" in N » t^ in M 03 00 r; N tC inio" CO vo 'o 'O *o r^ 00 CO 00 00 00 — « - M » M rt u *£ "S "S " " rt f >• f^oo a. v£ r^ 1^ t^ r^dj " " " "£ " "« > APPENDIX. 395 h G _M _0> _<^ CO ip m pi pi pi b. b.oo b Vi in p. 00 'C " u"^ p ;i r'r^r- - ri p - N ~ r •:•■:■:-■: - c. >r _M p .- - .-.- .-^ C < '^\,%C.C>'^ _r^ « t~ M moo V m '•«• m V s yf m p p-oo in 'm 'm V 'm Co m _N _-. p 00 'inb 'in'm'in Iv 'mb 8 (S Hi b b b b b b b b b b b b (DO 00 tvOO IV b b b b b b rv rv a^ rv iv b c b b Iv 'o Iv rv o 'o P < m in ^ « Co 00 _M _Xf « M p .* r> .0 ." r Vn 'm 'm rn 'm 'm M m mvC» _-r •b m 'ro 'CTi W 'J < 0! ■^Ih C O' O^ O^ ^ b> in tn r^ t^ b b b b b 'o m moo ■o ■<- b b b b M IV b moo Oip- m M S ° 2 '° p m p 'Oi'CTi b c 3 •< P M ■*) .■«• .t~ S? b b-oo W 'in b <> M pioO 00 •b V^oo inV m tn m •» •«• 8 00 yi tv _■* ^ij- V *m rn rn 'iv ■<- ■<- IT T ir 'S « m ■<■ >0 b m ■- m m >o '- "o pi Iv 5 O- p oo p - ■p vvv-;-; - p p .?< ;< .r< ■*■ -r ■* f -^ 'ff- •rp p IV in -J- 1^ "»■ ir V V .IV p m 1 e < mo* N M - SJ'- V« \njn t^ V V 'm 't^ 'i^ ■p bi IV _m p 00 - in IV ivo IV 'rv ev N p. m pi in bib - '« m p Ivu-, tv Q < ' 5 X CO « p«p _r^ ini in b vD ■b n p l^.m- r^ i^io lO lO ■b »0 lO tvio vo IV Co •p .-i-p _mp lO lO lO lO \o Co Co Co ^ •^ < m - Oi '•«■ rn ro y* r> p\ in'mb NO m W « N N « bi moo CO >p _««• rvoo 00 ivoo CTi b N p .myi.-* oi ooo '- vO 00 pi 00 m m v>. < Ui o Jjr- p _(N in - r* vO «o "^ ^ ^ •b - OT pi .-»• N i N _~ inip in Co iiND-b b Co ■b 'in b Co Co Co N m bi vO . i ■< o -p PI'P - W M M « N V> ♦ lO t^ - M P' P _tv ♦pip rv 'ino lb 'iv p m O _N mw _N 'tvCo oo b '- « w M m m f Mip N 'm m, m i 'J in p xn - p- « 00 en m V V V V p. _^oo rnp m 'fh i> 'm •i:^ invo p oo pi "in m V 'm m ■m ." P'T' P^." V N pi '■•■'♦ 'in c 3 i < - m r~ i ■p p m .►. (^ Vni i IV tn M ll f1 c* « b o - - vo p r. •*■ moo m V 1 vo m inivp 'm w 'oioo *N o" p- tv CD 00 OO 00 OQ •— E? O Ivoo Oi Q ^ 00 oooooo co- 1 s- > > •- M m -r in i O' 0> O- Oy <>^ c ■J \ c s »i Oi CTi 5i 5 •- J IZ II H •c c 2 O a 396 APPENDIX. ■■5 '^s c 5 •- CO - O O "1 ^ . 2 O i:if a :< "^ ~■"* w ~, lo' • - 5J i-, 1— ( 5§s = D > 2 2;^3 L) u\ ^■S . =<5 < .5."-' c r; y. c 5 X n J^ «'" 5> U-i •^ .s -2 l" "o_i t = i y. p. n". « ^ in V^'r-.i> CO t^ t^ r^ t^ r^ P p JN 00 ,-* 00 VvOO V* tN. r^ r«. t^ p^ t^ 00 yi _m p> m >n r^ r^oo 00 t^ t^ r^ t^ r^ t^ pi 00 rr 'J- « 'I- r^ -^ S5 c^ -j tC ^co W M IN. vO 00 in 0" f^ c5 in t^ coo CO 0* t1 N >o in o> M 000000 P- M en M N fl M u ^|f° 00 y^p^p r^ b "n n mm M 00 M _^ rn p w W VnVn .* M M V< V) ■« M T 00 e < m <■ >o N •* t^ w 00 •*^ m "* -^ fn w r^i c*oo >j- u-i m -.r rj- ■* « rt rn m T in in-o ov rC cS ^ 'J -" 2 < < H^ b b b b 1 b ' b b b b b b b b b b b c i .^00 M t^VO -<^ H. moo 00 ^o r^ c>. M ^H in in p 0' vo tv^o ■«- in 8 < g U ^ ro ro m fo m ^-^ vo r^ ^^ p -p Vo Vn Vn 'm Vo ^ p .*.t~p p> '■«■ Vo PI rn '« _-*■ i < m t-. M N ^ 6 S -^ 6\S 0" vo -^vo 00 m 'T in '4- g CO (N -J- M ^iS i « M M Ol>0 f) « g •«- N 0> -^-a 0_M 1 3 ei p m.M .'^>p C « N '^ N fO r m N ■♦ p- IV V. ■« M b b - 3 i < M M fO M WOO 000 (O 0^ t^ "^ O\co « W H -^ rx M N 00 OWN moo rn - m in in N « tv -j- Ol N < C3 - 5^ 1/-. _~ ;n yi p M Vl M N M .- p ^r^ p p\ p „ _^p rn m rn .;: c •< 00 N vo m 1^ ^ tC in tC tCvO '^ fn o^ CMn M \o -^ ^ "^ vd" (> tC tC tC 00 m H » ». fn>o cv w in-o" ■* ■» in m 'm W -^^ ? in -^ N p 'p 00 in 00 ^ « tv M cnp b 'oi V"ini) IV rv ■«■ 1 ■*■^0 N m in -00 0*8 I?i!» vo" ~" m n" <> 1- •«•')■■«• ■» m^o r>. a^ cS w ^o M-oo m M -•? m" rn dl 0' 0M0>0 00 j2 in tC (> - ^ tv t^oo t^oo a« Oii *0 ^C> "O »0 1^ J 5 > ' fa 1 P-l-^^^;! i 'O ivoo v! u t~. tv ivt^oo > 0000 oocooo- ; APPENDIX. 397 z a •^ ^C VD is VD "u1 V^ * V r^ vp p,p _r.^_„ fN. t^ t^ 1^ t^ u p y, p - r^ 1^ t^ r^ IN. h p> _M 00 p - 00 COM b-b. < S? o - « (^oo p oo p ♦ tx ^ yi 00 00 Q • ■* p p p p- .■«• - Od -b Vi V 'iH f, m "1 m ro b p p pv_M y 00 W 00 f^- f^, f^; rt-. r^. n- 00 .1-p ■b - c." 5 c 3 S < 'ri Vn'mVi 'm p p - y. p M V) V 'n V ? p p 00 C' p 'm Vl m Vl V ."" « p 00 w r^, V rV) *0 NO VO >0 t^ V l^oo p- bN ic ^p o b b "d b b b b b b b b b b b b b b b b b b b b b b ■- ^ b b 'u b b •^ •p ul p p p b b - M ■_ - « oo p p « ■«■ b V, ■« ■« Vl « p^ M r^y p. ■b oo p> pi < '■J a! c 3 I-. ■» Tp rl •;:■ y»QO 1^ ^T "- r^ - 00 p-p'CO "« b b b b p. b b b b b b ■P b •«■ in bblc. c a 1 < "^ b a> b b 00 b> 00 i) i -b W ■?; V Vo m m V) p b- p r-N_r^ .-. CO V, vv o- . 'J .r, t^ >r, >/■• ,o ' b b b b b b b b b b b b b b b b b b b b b b b b b b 1 b 1 < S? -r. •,-. N ■-. •- •» _«^>p p _m p "P p « .•♦ ." m >b fo y, in m m p> -b OS _-<- p X u ■^Si^ b b b b I~.p oo 00 M b b b b b b CO o> o» <^oo b b b b b b oo r^co <> p^ b b b b b b 00 o- b b V C a o E < 1- •*■ -t-O >n '■«• V t^ pvoo r^ ;«■ CO 'o m Vl 'm 00 >p « p _« 00 Vl Vl Vl V V bi W J N < ■p -p t r. - T p y y, _N p •- o oo - a V. b V, M b b P^tX) p CO - b b V b V p b '- 00 c 1 < "■^ b i Co "tV 1^ m Vl "u-, "lil V •^ royrp pivo V Vl V Vl m b- M _t^M3 p p» V 'r^ V V Vl V p N ViCc ►; i- 41 .■«■ fO - ro CI n n c< N ■^ b 2 2 2 b « W C* CI (1 s p y ,1^ p 00 V in V w b p ►. M oo (7. in "s^ ." P .^ c 1 < "^ QO O^OO 00 •P p p 00 ui _m « m o» >A V^ oooo t^ a> o< o Vn T N cpf) y Voo N- VOd o O\o5 CO m - -00 p p - Vn pi bv OOM SSS- ill > > oo oo oo oo CO ^ .1 o> o- o- o a>*- t- ' iZ ^0 r^oo o f^.C a« 1^ o o *-■ J iZ II 5 o H c a 6 398 APPENDIX. :S^ii 5 „ -(i. ^» s e 52 S ^ =-Ji V~5 ^ 5 tio = ■■§•1 a-g-./, "M '^'t' c-2 s^ s ■- '< " ..-^ •o ■« ^ > u ■S — S l_H ~ . 5 o m < .= SS5 ^ ^ S* ■■s-'i-2 5^ S g = « ?: o -v ^ it o •— .^*' -^^ !; ^=2 ^ S c o w ? -, •< ^ ^ - c i p i; H^ 88888 8 88888 8 88888 8 ^S^S:^ ~^ >n *^^ 0- »n M « 00 -^i^s M as m w r^ m NO c N - >0_ ■» N -0 c« o> 0_ M •♦ rN. N Tn i^ ti li S in -*oo «" M i_ 3 ^ e < ■o 1^ C"0 vo M c;?o 6 M M M « ro CO CO CO CO CO On h'^U " " " j=.-a .n M c^co -t o> P .-J--M 'p ~ m_r^H- t-_,n M S m §55 =^f3 W '?) M N CH « " " " " " " C* N M N M " *o ■* -^^o « „ ■♦ CO CO f ■«• M -^vo m Ov ~in" .:> roO^- fn 00 ■»■ rv M vo M 00 a ^ N VO ^ O. CO " ■<■ On r^ lA a* o; In ^=3 n 3 tn cJ" dv M cT ■♦^ cS •* r^oo N CO O o 1 <; t^vO VO t^O m 1^ r^oo 00 00 CTn CO 00 t^ r^ h S ♦ ■;i O-J CO i/ia> poo CO 10 M M r^ >^ C' CO r^ in r*. rs. r^ i ^2 w N 'CO'CON Vo w « 'co n ■« ■« w c M t^oo 00 I^ H N "^ u-i 1- OuO On « f- t^ "?. *o 00 o^ r-^ ro VO 'T Oa5 o q; q- f._ .n r^ ^ r^^o 00 00 CO 0" U-I c^ 10 r^ 00 0" "" 0~ m" 0" c^ 5 0" - •«; cu •< H M « M _1 MM in u ^ "rt On On On Ov 0> .'-' N N ^ M M N CO * s* '^ H b b b b b M M H M •^ M o£ o CO in M CN < 3 i CI -<*■ -H N t^ t^ ? t,^ r^ r^ fN. r^co r^ CO C^ M W ■>*- ■<^ M W coo NO tT CO -r •* ^ C^ u < ^ ~ '^ " < ^'o-j yi ;l _N _ro rn COUIM ^„ >p P .On* CO CO y, Q ^Bi! '« 'o\ b '- CO b 'oxVm CO CO CO ■ 00 't^ t^NO V^ t^ Z X ^ f) 00 N u-i r^ rN ct t-i 00 t^ ~in in in 00 00 NO o i_3 n! t °_ " ? coco 0\ C7\ CO % a r^sD CO « M 0" CO cS .^ NO_ N ^l-NO M ?i fJi N if ?o i C3 < ~ ^ " <>.^ >. °~ p> t^ en M <<> m .■*."*"? p ."" CO ONint^M _j» ON "5 Q i CO CO V '-t '•*■ V V V V V '10 'm V 'm in inib no »-* X 2: V r- 2^-5 r^ CO •«■ M c^ in ^ COOO ON NO « « m in CO G = 2 c w OD r^ ^ c^ NO CO lONONO t^ 3 , , -Nt-oo in H- lONO CI in in On r^co OnnO = ctn CO in-o t^ 3 '0 r^oo in C7» >o ON -T -r - CO ** 00 ON M_ o_ in ^ 1 MD invo' in in o" 10 ■o-o'io" rC CO no" NO no" r^NO c-> M < ro "^ "^ X o-j 41 t^ trt r<^vO CO c 00 ip « « .1^ '« "« 'coVo'w pN On « «5 ON .CO '« ro*« « CO P 10 00 t^ fi ui »n t-^ Ci - 00 CO ^ ■^NO M NO On NO a \0 'O t-. ro « On CO M m « N CO CO -^-OO El 9 00 t^ t^ r^ in >o_ m ♦CO ^^o■^£^ ^ tCoO >o" c^ (5n -" x" 0" f^" m" cl" cK 0" CO NO CO MM MM 03 < •- _^ ■- —^ "— N 1. e u e s - SO 1^00 \0 vO %0 "O 1^ n ►. M CO •«• m « rs. (^ iNi. t^d5 2„S " V — j: >l 00 00 CO 00 00 3-5 >4 00 CD 00 00 CO rt-S*^ 1 ^ u *^ « "^ ** " 3 > APPENDIX. 399 TOTAL Imports FROM KORKIGN COUNTKIKS AND BRITISH Possessions. S8888 8 88888 8 38888 §8888 8 88 8 o E p p a p a ■O r~. mi b n •* ■* rn ro 00 O' M IS. tN. ■♦^0 CO M « fO CO r^ -r ■* a 'inViVooij m « >- •^ ■* -* -^ •* 00 . in ■_ ■- 'm'-'. -^ m, c~ 00 r; •«r •♦ -r •*■ m .f) .0 .-r m m p so H - ^^P M p - 'p ,r- "P -^ h- t r^ _a> c-. M p .r^p P' .On - p fi p p< '- '0 '- Vl "0 » '0 '0 f, e 3 a- o o^ ctjo p> 'a- •b y-00 00 pv in c^ CT- c> o- r^ « p ip 00 _in 'r' V ai b. a. oi o^ c -n VDOO m 'mi OD 00 lO IT, -7.2 s. _-c t- \r, p^ep '« Vi ci Vi Vi r ." r P*r •;; "»• n .m . ■»•.■* •* _M p _M in in m V) M m m m p CT, p 1 j m _M 00 _« _■♦ ■-^ o>'- "- p a» N p -p p^ '- M W 'n «3 V> r^co rn f^ f*) 00 b m_-*-p p « -p .m '0 a -J- in -f ir, ti .- .-..-.-.-.- ,-r 1 '- 'm '■- '» b .- .0 .•-• •^ c 3 O ♦ m t> Omo S? "uii, '.n V, V p ^ in invo C m in in p ■«• t^ Co in 'in 'in '•n 'i-^ _f»lpvM _M p m vno no -r VO .M .t^ .01 vO < E z 4l N ^ M OO xp 00 0\ O\00 00 Ov _w _vnp> looo bvoo V^oo V- m 00 _^_N yioo ■* pv p \^\^ s 3 S? '« aoo V - f^ r*l rn f^ fn r^ M «p 00 N 1^ "n "- "o i 'n -0 « m N -p -»■ N 'o i> 'i^vo r-i t*-, n N f* .t^ rnoo ,"*>.'♦.'«' V) 1^00 vs •< . si C O 03 _- _« _<^, r^ »0 ^ ^0 r^« ■JD P .UTO r-; C SO »b « t^ •b n CI _*a> p 't^ 'r^ *r^ 'r^oo *r^ r^ in « Oioo iibiONoi) NO MO .r^oo vD 'm VO < N ^ "^ "O b- ^ O^ra rn •b M in p.00 -J- '- '0 V- 'm rn f^ n m 'n pi Co * _-f p. _-n _■♦ Vt-cj-oo V^'in •b 00 NO ."*"p ." .">."■ m OD 00 OvOO vO b b b b b 00 b ^in i^ip r^ip b b b b b b ip .f.in -r T b "0 b b .in - c < t- lO 0> Ov p ■0 p, p .* * t^ Vl VoVoVoVi ■? .-t-CTiyiooo ■^ .•no .0'.0>.'*>

••« p v. p. _T _m - ;i '^ .1^ .■*■ ."♦■ .'^ ,'' c .^.'" •^ c 3 C ■^n 2 2 : 2 r^ aVi V) pv •p MD m p^ .■«■ « VVo'm 'fn VO .-1-p 00 .1^ .« lb b>b b V< ♦10 'o "i-i dome? ooro'• ooooa>cooa- P - * w ^0 1^00 O* J ro 00 CO OD O*^ o3 00 <» CO oo — ,, n „ M ~ £ C r . i: o> o> 0- 0- oi** J > > 13> $1 6 ^ c 4 II H •a c n 400 APPENDIX. TABLE VII. Statement compitcA from the tiio piciious TaiUs, showing the Proportion of the Total Foreign Trade of the United Kingdom — Imports and Exports of Merchandise- carried on loith each of the undo mentioned Foreign Countries and British Possessions, in each Year and Period of Five Years since 1866. l-UKI::it;N CULNTKIHS. Russia. Germany Holland. Belgium. France. Italy. Turkey. Egypt. 1 Per cent. Per cent. Per cent. Per cent. Per cent. ■Per cent Per cent. Per cent. 1866 S'o 8-3 S'o 27 "■9 2'0 2 "5 4 "3 1867 5 '9 9 '7 S'l 3'o I''3 1-8 2'2 4-8 1868 5 '2 97 5 "4 3 '2 II"0 19 27 4 "5 1869 4 "9 9"S 57 3 4 10-7 2"I 2-8 4 7 1^70 5-6 7 "9 5-8 37 io"9 I "9 2-6 42 For the 5 Years 5'3 9-0 5 '4 3"? 1 1^^ J '9 2-6 4 '5 1871 5"S 9'4 5 "9 4 '3 10-3 2"0 2'2 3-8 1872 5'o 9 '3 5-6 3 '9 lo'S I-i 2"0 3-6 1873 4-8 f3 5 '5 4-0 lO'i 1-8 2'I 3'o 1874 4 '9 8-2 5 "4 4'i 11-4 17 2-0 2"I 187s 4-9 8-5 5 '3 4 '4 "■3 2'0 2'0 2'1 For the 5 Years 5'o 8-8 5 '5 4"i 10-8 1-8 2"! 2-9 1876 4t 8-0 5-6 4-2 1 1 -8 I "9 2"2 2'2 1877 4 '4 8-S 5 "5 3-8 ii'i 1-6 2'0 2"I 1873 4 '4 8-6 5 '9 3 '9 ii"i 1-6 2'I »'4 1879 4 '3 8-4 • 6-1 37 io'6 I "5 1-8 1-8 1880 3-9 7 7 6-0 3 5 io"o 14 1-6 1-8 For the 5 Years ; 4-2 8-2 5-8 r8 io"9 1-6 »'9 '■9 1S81 3 '3 7-6 5 '5 3-6 lO'l 1-6 17 1-3 1S82 4"' 7-8 5-8 4 '2 9-6 I '5 1-6 i"5 1883 3-9 8-2 5-6 4 '2 9 '3 1-6 1-8 1-8 1884 3 "5 7 '9 6-4 4 '4 9 "3 1-6 1-8 19 i88s 3 '9 7-8 6-4 4 "5 9-2 1-6 1-8 I "9 For the 5 Years 3 '7 7 '9 5 "9 4'2 9'5 1-6 »7 1-8 1886 4-0 7 7 6-5 4'2 9-2 1-6 »7 >7 1887 3 '5 8-1 6-3 4 3 9-0 1-8 »'5 17 i8b8 5'o 7 "9 6-1 4'2 Q-2 I "5 I "4 I '5 1889 4-8 7 '9 5 '9 4'2 9'i I '5 «7 1-6 1840 4 "4 7 '3 5-6 4'i 9 '3 I (5 1-6 1-6 For the 5 Years 4'3 7-8 6-1 4'2 9-2 1-6 1-6 1-6 1S91 4 3 7 7 57 4'i 9 '3 •'4 17 2'0 1892 3 '4 77 6-2 4'2 91 »"3 •7 2"0 '893 4 4 8-0 6-5 4 4 9'3 »'3 1-6 1-8 1894 S'2 8-2 6-1 4 '4 9-2 I "4 '7 2'0 1895 50 8-6 5-6 42 9-6 '■3 1-6 1-8 For the 5 Years 4 '5 8-0 e-o 4"3 9 "3 J 3 •7 '■9 1896 4-6 8-3 5-6 4 "3 9-6 1'2 J "4 1-8 1897 4-6 8-0 57 4-8 9-8 I "3 1-8 '■9 1898 4 4 8-1 5 "4 46 9 '4 '■3 »"5 »7 1899 4 3 8-4 5 "4 4 '5 93 14 13 2'0 I goo 4 4 8-0 5 '3 4-t 9' I '5 '■3 2*1 For the 5 Years 4 5 8-1 5 "5 4 '5 9 '4 I '3 '■5 '■9 1901 4 '2 7-6 5 '4 4 3 8-6 I '5 I '5 2'1 1902 4 "4 7-6 5 "5 4 '4 8-4 »"3 '■4 23 For the 37 Years i 4"5 8-2 57 4'' 9"9 1 1-6 I a a"3 API'liNDIX. 401 TABLE VII. {continued). United States. lUKEIG.V CUU.NTKIES ((0»tOii,t,fj. I Brazil. Chili. Peru. China. Japan. Other Forei^ 1 Total 1 Forei^ 1866 1867 1868 1869 1870 Per cent M7 130 12-8 '30 14-8 '3 7 Per cent 2"7 23 2 '5 27 2'I Per cent 0-9 I '4 1'2 I'l 1'2 Per cent. 0-8 I'O o'9 I'O I '2 Per cent 3'o 2 '9 3 '4 31 2 '9 . Per cent 03 04 o'3 03 o'3 . Per cent 117 I2'4 I2'2 120 I2'9 Per cent. 75 B 77-2 769 770 78 'o For the 5 Years 2"S I "2 10 ! 3'o o'3 I2'2 770 1871 1872 1873 1874 187s 162 150 '5-9 '5-9 '44 2 '2 2-6 2 '2 2-3 2 '2 I'O '■3 I '2 I'l I'O I'O 3'o I'l 30 12 2'6 o'9 1 2'4 10 2'9 o'3 o'3 o'4 o'3 o'S I2'0 I33 139 133 I2'9 791 78 '3 777 76 7S'4 For the 5 Tears '5"5 2 '3 '■' 1 '■•' 2-8 1 o'4 1 ,3', ! 77-3 1876 1877 1878 1879 1880 152 '5' i7'4 192 2J-8 1-8 2'0 1-8 1-8 «7 09 I'l j 3-1 o'8 o'9 1 2-8 o'6 I'l 2 '9 0-8 o'7 2'6 o'8 o'4 2'5 °'4 o"5 o'6 o'6 06 '3' 13' I2'2 I2'3 I2'4 75-6 74 '4 75-6 762 75 I For the 5 Teari 17-6 1-8 "■3 o'8 1 2'8 ! O'S ! 12-8 7S'4 i88c 1882 1883 1884 1885 For the 5 Tears 20'2 '77 i8-6 J7'4 ; i8-3 .8-4 '■9 '•9 I '8 17 '■5 17 o'8 o'9 o'8 07 o'6 o'8 0-5 OS 04 o'S o'4 o'4 2'4 0-5 , 2'J o'4 20 o'4 21 o'S 2'2 o'6 I2'8 '3-8 13-8 >3S I2'9 74 3 73 4 74 2 73 "2 73-6 2 '2 o'S 1 t3'4 737 1886 18S7 1888 1889 1890 '9'3 : 19-2 1 .7-6 i8-8 192 1 1-6 1-8 '7 17 '7 07 07 o'8 0-9 09 o'4 o'4 o'S o"3 o'3 2 '2 2'I 19 »7 IS 04 07 O'S 07 07 I2'3 132 '39 139 '47 H7 73 '5 74 3 740 747 74 "S For the 5 Tears i8'3 '7 0'8 1 0'4 1 fg 1 07 74 '2 1891 1892 1893 1894 1895 '95 20'9 187 »7 7 i8-6 •7 1-6 1-8 «7 1-6 o'8 I'l I'O o'9 o'9 03 o'3 03 0'2 03 IS 13 I "3 I '2 I '3 o'6 o'6 07 07 o'8 '35 «3-6 139 141 14 "5 741 750 75 747 75-6 For the 5 Tears 191 1 »7 I'O 1 o'3 1 1-3 1 07 1 ,V7 1 74-8 1896 1897 1898 1899 1900 187 20'2 21-6 231 [ '■5 '•3 '•4 1'2 '■4 o'9 OJ ,-3 to , "7 o'3 ,-, ,0 07 o'3 I'O o'8 o'8 o'3 1-2 1-4 ■'o o'3 1 o'9 1 I '3 '40 : I3« «4'4 12 '2 .4-8 751 757 752 7S'.t 75 '9 For the 5 Tears 20"2 '■4 °'8 oi ,-, ,., i ,,.31 75 '4 1901 1901 20-5 j '94 1 I'l I 3 o-t o'3 I'O o'3 i-s 1'2 o'8 '47 '54 74 9 74 '4 For the 37 -Tears .7-8 1-8 °'9 ' 0-6 2'! i 06 j IV5 1 75 4 A A 402 APPENDIX. TABLE VII. (continued). Statement compiled from the two previous Tables, shoicinf; the Proportion of the Total Foreign Trade of the United Kinf^dom— Imports and Exports of Merchandise- carried on with each of the undcrDicntioned liritish Possessions, in each Year and Pciiod of Five Years since 1S66. BRITISH I'ObSHSSIO.NS. British Brit. West Austrah.i 1 Other Total North Indies & and New G. Hope 1 Brit. Pes - Brit. Pes . Grand America Guian.-i. Zealand. 'andNata . sessions. sessions. Per cent Per ce Per cent Per cent Per cent Per cent Per cent Per cent. 1866 27 17 4 9 IO-8, 0-8 3 "3 24*2 100 1867 2-7 17 4« 9-6 °"? 3 "3 22-8 loo 1868 2 '4 1-8 4 '9 lO'O 0-8 3 "2 23-1 100 1869 2-6 1-6 S"o 97 0-8 3 "3 23 'o lOJ 1870 2-9 »7 4 '5 8-3 0-9 37 22 'O lOO For the 5 Tears. 2-7 17 4-8 97 0-9 3 "2 23 "o 100 1871 3'o 17 4 "2 8-£ 0-8 3'i 20 '9 JOO 1872 3'i i"S 4-6 7 '9 I '2 3 '4 217 100 I873 3'i J '5 5"3 V i'3 3 '4 2i-3 100 1874 3 '3 I '5 5 '9 8-5 i"3 3 "5 24-0 100 1875 3'o 1-6 6-4 8-5 I '5 3-6 24 '6 100 For the 5 Years. 3'« I '5 ! 5'3 8-, I "2 3"S 227 100 1876 3'o 1-6 6-6 8-5 '■4 3 '3 24-4 100 1877 3» 1-6 67 8-9 I '4 3 '9 25-6 ICO 1878 27 I "5 6-9 8-5 1-6 3'« 24-4 lOJ 1879 27 1-6 6-S 7-8 1-8 3 '4 23-8 ICO 1880 3'i I "4 6-4 8-9 1-8 3 "3 24 '0 100 for the 5 Years. 2-9 I '5 6-6 8-5 1-6 3 '5 24 "6 100 1881 3'o I '2 7'3 0'2 '■9 3'' 257 100 1882 2-9 14 7 '4 9-8 2'0 31 26-6 100 1883 3"o I '2 7'2 9 '9 JS 30 25-8 100 1884 3-0 I°2 8-0 97 i"S 3 '4 26-8 100 1885 2.9 I'O 8-0 9-8 I "3 3 '4 26 '4 100 For the 5 Years. 3"o 1'2 7-6 97 ^'■6 3 '2 26-3 100 1886 3'i 0-9 7 '4 io"5 I "3 3'.^ 26's 100 1887 3"i 0-9 7'i 97 1-6 3-3 257 100 1888 2-6 i"o 7-9 9 "4 1-8 3 3 26 'o 100 1889 2-9 0-9 7 '4 9-2 21 2 a as 3 100 1890 2-8 0-8 7 '9 9-I 2-1 2-8 25 '5 100 Fo; the 5 Years. 2-9 0-9 7 '5 9-6 1-8 3'i 25-8 100 1891 2-8 0-8 8-0 8-6 2'0 37 25 '9 I GO 1892 3"i 0-8 7 "3 8-3 2'0 3 4 25-0 100 1893 3 '4 0-9 6-9 8-1 2 '3 3 4 250 100 1894 3'o 0-9 7 3 8-5 2 '2 3"S 25 3 100 189s 2 "9 0-8 7 "5 7 "4 a '4 3 4 24 '4 100 For the 5 Years. 31 0-8 7 "4 8-2 2 '2 3 '5 25-2 IOC 189$ 31 0-8 7 3 7-6 "'l I 3 '4 24-9 1CX> 1897 3 '5 0-6 7' 71 2-6 1 3 4 24 '3 ICO [1898 37 06 6-8 7-6 2"S 3-6 24-8 100 1899 3-6 0-6 7'i 7 '3 2 '4 37 247 100 1900 3-6 0-6 7 "4 67 2'0 3-8 241 100 For the 5 Years. 3 '5 0-6 7"' 7 '3 24 37 24-6 100 1901 3 '5 06 7 "4 7 "3 2-8 3 5 25-1 100 1902 4'i 0-6 6-6 7» 37 rs 85 '6 100 For the 37 Years. 3'' .-. 1 67 1 87 1-8 3 4 24 '6 100 APPENDIX. 403 TABLE VIII. Statement showini; the Value 0/ Imports of Merchandise into Germany from the under- mentioned Countries, and of Exports thereof from Germany to the same Countries in the Years i868 to 1S77, made up from the Statistics of the different Countries named (in the absence of official German statistics) by treating the Exports from them to Germany as ImportsintoGermany, and the Imports from Germany into them as Exports from Germany ; in thousands of Francs and Pounds sterling — i.e., 100 = 100,000. I.MPORT.S INTO GERMANY FROM EXCESS OK IMPORTS. Years. Gt. Britain Switzer- land. United Total of In Thou- In Thot:. France. Belgium. and British India. Italy. States.' + Enumerated sands of sands 0( Pounds Sterline- F. F. F. F. F. F. F. £ 1868 315,000 107,647 808,654 S,3i6 1 10,099 1,246,716 290,160 11,606 1869 305,000 121,276 803,716 c 3,022 139,133 1,372,147 399,488 15,979 1870 104,000 138,535 708,014 5 4,774 174,390 1,129,713 365,617 14,624 1871 199,000 209,085 971,234 •5, 8,171 158,079 1,545,569 529,397 21,176 1872 410,000 240,277 1,083,667 .s 7,600 185,101 1,926,645 662,755 26,510 J873 463,000 266,064 919.239 13,815 271,864 1,933,982 609,705 24,388 1874 414,000 243,120 883,241 18,569 286,315 1,845,245 607,896 24,3> 12,917 140,478 764,096 1871 160,000 230,244 482,421 u I3,OIQ 130,488 1,016,173 187a 358,000 168,554 481,984 u .4,884 240,468 1,263,890 — 1873 311,000 171,530 498,747 23,7'o 319,390 ',324,277 — 1874 3'S,ooo 166,852 499,266 37,899 228,332 ".237,349 » 1875 349,000 •7I-597 *46,498 a 37,3'2 309,284 1,313,691 — _ J876 389,000 "95,763 528,107 40,089 183,664 1,336,623 1S77 373.000 ' 214.767 657,387 25,202 169,046 1,439,402 — — * The values of llie Uiited St.itcs exports to Germany luive been reduced from currency to specie values. t fhe returns for tl)e United Sj.ites are for ye.ir$ ending joth June. 404 APPENDIX. TABLE IX. statement shelving the Total Value of Merchandise Imported into, and Exported frotn, France, in the Years 1868 to 1877, according to the French official Returns; in thousands o/francs, i.e., 100 = 100,000, Note. — The figures are those of the French "Special" Trade, viz., Imports fof Domeiilic Use and Manufacture, and Exports of Domestic Produce and Manufacture. Years. Total Imports. Total Exports. I'.xcess of Imports. In Ihousands of Francs and Thou- sands of £ sterling. Excess of Exports. In Thousands of Francs and Thou- sands of £ sterling. 1 868 Francs. 3.303>70o Francs. 2,789,900 (F. 513,800) \£ 20,552) — 1869 3.153,100 3,074,900 ( F. 78,200) \£ 3,128/ — 1870 2,781,400 2,802,100 — ( F. 20,700' \£ 828 J 1871 3,566,700 2,872,500 f F. 694, 200 ) \£ 27,768/ — 1873 3.570,300 3,761,600 — f F.191,3001 \£ 7,652/ 1S73 3,554,800 3,787,300 — (F. 232, 500) (£ 9,300/ 1S74 3,507,700 3,701,100 — (F. 193,4001. t^ 7,736/ 187s 3,536,700 3,872,600 — iF.335,900|. (£ 13.436/ 1876 3,988.400 3.575,600 (F'.4i2,8oo) \£ 16,512/ — 1877 3,669,800 3,436,300 (F.233,500) \£ 9,340/ - APPENDIX. TABLE X, 405 Stalemenl showing the yalue of Imports of Merchandise into France from the under- mentioned Countries, and Ext>prts thcrco/frovi France to the same Cowi tries, according to the French official Returns, in the Years 1868 to 1877, covering the period 0/ the payment 0/ the Indemnity to Cernitiny ; in thousands o//rancs,\.e., 100 = ioo,coo. I.MI'ORTS EXCESS OP IMPORTS. Years. Germany. PelRium. Ct. Britain and British India. Switzer- land. Italy. United States. Total of Enumerated Countries. t„ Ti In Thou- '^■^""- sterling. F. F. F. F. F. F. F. F. £ 1868 266,000 3S4.O0O 679,000 141,000 327.000 156,000 1,923,000 - — 1869 256,000 316,000 687,000 133,000 321,000 174,000 1,887,000 - — 1870 103,000 272,000 646,000 102,000 235,000 218,000 1,576,000 - - »87i 160,000 476,000 920,000 105,000 441,000 190,000 2,292,000 189,000 7,560 1872 358,000 440,000 764,000 97,000 375,000 205,000 2,239,000 - - 1873 311.000 47S.OOO 673,000 92,000 346,000 199,000 2,096,000 -- - 1874 315.000 409,000 697,000 96,000 289,000 241,000 2,047,000 - — 187s 349,000 439,000 753,000 94,000 322,000 190,000 2,147,000 — — 1876 389,000 404,000 789.000 110,000 415,000 265,000 2,372,000 - - 1877 373,000 409,000 724,000 96,000 342,000 258,000 2,202,000 — — 1;.\P 21,991 11,340 — 1896 33,623 21,726 11.897 — 1897 38,270 21,017 17,253 — 1898 41,977 21,030 20,947 — 1899 40,218 23,408 16,750 — 1900 43,635 22,489 21,146 — 19OI 45,869 28,616 •7,253 — 'J'otal for the 10 Years. ) 397,641 231,739 165,902 APPENDIX. 407 TABLE XII. Statement showing the Value of Imports of Merchandise and Treasure, on Private and Government Account, into British huiia from the undermentioned Countries; and the Values of the Exports of the same from British India to the same Countries, in the Years 1892 to 1901 inclusive; compiled from the figures given in the Colonial Statistical Abstract, in thousands of pounds, i.e., 100 = 100,000. ^ [ Exports o\ J Imports [ Excess of Exports (Exports Imports Excess of Exports [ Exports o I Imports 00 -\ ' [ Excess of Exports ( Exports _q\ I Imports - I (^ Excess of Exports ^ [Exports o^ I Imports '^ ] [^ Excess of Exports (Exports Imports Excess of Exports o^ J Imports y Excess of Exports / Exports ON I Imiiorts « I , 1^ Excess of Exports I E.xports 5 I Imports 1^ Excess of Exports (Exports Imports Excess of Exports Germany 2,488 ! 6,850 ' 2,891 ! 4.853 1,474 7,725 4,oJio 908 1 3.172 1 4,622 1 1,037 i 5,753 829 ! 4.924 2,768 1,029 i.7.?9 3,046 '' 146 1 2,900 2,831 729 1 2, 102 14,249 i 5.847 8,402 6,481 1 787 3.460 2,220 1,240 2,249 170 2,030 8.1 1 H.740 1 6,600 3,585 5,694 2,070 1,219 5.140 4,184 93«_ 3.246 4,709 500 4.209 2,055 1,011 1,044 2,529 245 2,284 3. '64 599 2.565 12,438 4,374 8,064 4.534 1.323 3,211 4,888 660 4.228 2,223 1.535 2,929 395 3.326 706 2,620 13.304 5,193 688 2.534 8,111 4.560 •.395 3.852 649 1,849 1,452 2,950 449 2,501 2,911 930 1. 981 14,220 5.517 ' 3. '65 ' 3.203 397 8,703 4,042 3.070 3,046 722 2,924 1.963 1,824 139 2,590 652 1.938 1 3.795 2-153 2.642 10,089 7.023 9,066 5.503 1.152 4.35' 5,218 4.367 3,>66 ',499 1,667 1 4.591 793 3.798 3.591 984 2,607 i 18,254 7,623 10,632 5,021 1,124 3.897 4.443 1 830 1 3,613 2,290 1,247 ',043 1 3.589 ; 419 3. 1 70 5.079 1,001 4,078 18,720 7_'i93 11,227 6,147 '.736 4,411 4,011 779 2,374 1,641 73: 3.015 544 4,821 909 18,464 9,509 2,471 3.9'2 8,955 4o8 APPENDIX TABLES XIII. AND XIV. Statement shoxi'ing the Rates of Duty levied hy certain Foreign Countries on some Articles of British Produce or Manufacture, compiled from information given in the Returns of Foreign Import Duties published by the Board of Trade for 18S5 and 1901, and also the Rates of Duty on certain Articles levied by the Colonies, from information given in the Returns of Colonial Import Duties published by the Board of Trade for 1902. In each case the highest and the lowest Rates of Duty are given for the respective Years in each method of classificatiou. A. — Foreign Countries. COTTON YARN AND THREAD. WOOLLEN AND WORSTED VARNS AND THREAD. 1885. 1901. 1 1885. 1901. Pel cwt. 1 r.-r cwt. I'er cwt. Per cwt. I'ro.-n To From To From To l-rom To £ s. (1. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. Russia I 15 6 2 19 I 2 17 2 5 '8 3 per cwt. gross. 3 13 II 488 4 3 9 5 " 4 Sweden 086 127 086 127 II 4 0199 11 4 127 Norway 3 iij 0114 058 16 II 074 II 4 086 14 I Denmark . . 071 t8 10 071 i8 10 095 18 10 095 18 10 Germany . . 061 I 15 7 061 I 15 7 4 oj 12 2 4 oj 13 2 Holland . . Free. Free. Free to 3% ad val. Free to 3% ad val. Belgium 4 of 104; 2 oj 10 2 082 12 3 2 oi 10 2 8% 8% ad valorem. France 061 887,", 0'I3 0'22 per 1,000 yds. 061 II I 7,',, o'i3 0"2 per 1,000 yds. 4 loi 2 18 II 061 II 17 Portugal I 13 8 3 14 9 I 14 4 12 I 5 10 8 31 3 2 6 17 2 26 5 II Spain . . 2 10 10 517 208 5 ' 7 208 6 I II 517 9 17 a Italy .. .. 074 2 4 "i 074 2 II 9J 104 I 16 7J 18 3 277 Austria- I 6i 16 3 Hungary. . 061 I 10 6 061 I 15 7 I 6J 12 2 Switzerland 2 si 8 ij 2 loi 14 3 2 oi 038 a si 12 2 Greece :9 2J I 18 5 16 280 Free 8 12 10 Free ; from £3^0 to £S »2 10 Turkey 8\' ad valorem. 8 ■ ad valorem. 8X ad valorem. 8% ad valorem. Rumania . . obi 18 11 4 loj 16 3 £1 8 5 14s 308 Bulgaria — 14'i ad valorem. — 14% ad valorem. United States .. 268 II 4 14 180 From ^2 6 8 and From jC6 Z i and 50% ad valorem. 45/;, ad valorem. 35% ad valorem 40% ad valorem 3jd. per doz. spools. From v'„d. per lb. for to A8 3 4 and 40% 10^8 19 8 and 40X each number ad valorem. ad valorem. to ."„d. per 11). for each number. From }d. to 3d. per doz. hundred yds. Japan . . . . 7S. 3d. 15% ad valorem. 13 10 15 10 APPENDIX. 409 TABLES XIII. AND XIV. (continued). A.— Foreign Countries (continued). LINEN, HEMP, AND JUTE YARN SILK YARN AND THREAD. AND THREAD. iE8s. 1901. 1S85. igoi. Per cwt. rcr CHt. Per cut. IVr cwt. From To From To From To From To £ s. o 8 Jute : ij 3 16 7 Linen : 1 IS 5 3 >6 7 ;ClI IS 6 13 4 17 3 Spain Jute : 032 2 9 10 Linen : II 2 2 9 10 Jute: 4 3i 2 18 9 Linen : 18 3 2 18 9 4 oJ 12 14 084 10 3 Italy Jute: Jute : ;il 4 I I 418 4 of 14 I 040! 186 Pure Silk of all Pure Silk undyed Linen : Linen : kinds free. free. 048 14 I 5 8J 186 Austria- Hungary I 6i I 10 6 016} I 15 7 Unbleached pure Silk free. 124 3 2 10 Unbleached pure silk free. £t 15 Switzerland 003 9 9 5J 16 3 004! 16 3 4I 145 Lireece 12 10 261 19 2 280 £3^0 £aS I 4 Turkey 8/ ad valorem. 8 ^ ad valorem. 8% ad valorem. 8'o ad valorem. Rumania .. Jute: 2 oJ 040} Linen : 7% ad valorem. Jute: 2 oi 104 Linen : 5 8i .04 ;iii 3 6 £^3 3 8 Bulgaria .. — Jute : 14% ad val. Linen : 10% ad val. — 14% ad valorem. United Slates .. From 35% to 45 '; From 4s. 8d. plus 30;^ ad valorem. From .£4 13 4 and ad valorem. jo'4, ad val. to 4s. 8d. plus 35% ad val. I 12 8 308 15% 40% ad val. Jd. per lb. for each number. us. 3d. 15 ^ ad val. lo £n and 15'. ad val. Japan m. From 8 „ to 15'^ ad valorcin. From 15% to 2ori ad val. : From £2 I 3 to A >5 4 410 APPENDIX. TABLES XIII. AND XIV [continued). A. — FoREic.N Countries (contifiiud). COTTON CLOTH (not made up). Including Sail-cloth. WOOLLEN (PURE) AND WORSTED MANUFACTURES. Excluding Embroidery, Cloth List, and Articles of Clothing. 1885. 1901. 1885. 1901. Per cwt. Per cut. Per cwt. Per cwt. Trom To FroMi To From To From To £ s. d. £ s. d. £ s. d. £ s. er cwt. Writing, /i 4s. iid. Printing, 3s. 65d. Writing, 12s. 2d. to £i 2S. lod. ; Printing, 4s. 3id. 4s. ojd. Writing, 3s. oid. ; Printing, 2s. o.\d. Writing, 2s. lo^d. to 6s. 6d. ; Printing, 2s. icld. Writing, 9s. 7Jd. ; Printing, 5s. i]d. 8% ad valorem. 7S. gd. Writing, 25°;^ ad val. ; Printing, 15% to 20% ad valorem. £\ 6s. 2d. 5S. 8d. Writing, 7s. 4d ; Printiig, is. 8jd. 5s. I id. to i8s. lod. 3s. oi,d. 5% ad valorem. IS. 7jd. Writing, ^'. o.|d. to 4s. lojd. ; Printing, 4?. oJd. Writing, £1 12s. ; Printing, Jis. 9d. 5s. id. to 19s. lod. 5s. id. to 19s. lod. 5s. id. to 8s. 2d. 3s. o^d. 3S. oid. Writing, 3s. 3d. to 8s. 2d. ; Printing, ^.s. 3d. Writing, gs. 7d. to £1 I2S. od. Printing, 3s. 2id. to gs. 7d. 8% ad valorem. 14s. 3d. to 16s. 3d. 14% ad valorem. Writing, gs. 4d. atid 10% ad valorem to 1 6s. 4d. and 15 '4 ad \ alore m ; Printing, is. 4jd. to 3S. 8Jd. 15'i ad valorem. Writing, io;i ad val. Printing, is. 4id. to 2S.o4d. 412 APPENDIX. TABLES XIII. AND XIV. (conlinued). A. — Foreign Countries {continued). CEMENT. PIG IRON. 1885. 1901. 1885. 1901. Per cwt. Per cwt. Russia.. 8}d. per cwt. ')\A. per cwt. IS. 5ld. 2S iijd. to 4s. lid. Sweden tree. 4d. cwt. gross. Free. tree. Norway Free. 2S. 3d. per ton. Free. Jree. Denmark .. free. Free. Free. Free. Germany .. Free. Free. 6d. 6d. Holland .. Free. Free. Free. Free. Belgium Free. Free. %. Id. France Free. 2s. o^d. to 4s. ofd. 7Jd. per ton. Portugal . . Free. i6s. per ton. 2 "06 % ad valorem. lid. Spain .. 6d. per ton. IS. yid. per ton. IS. ojd. 9Jd. Italy .. .. 2^i\. per cwt. 2^d. to 6d. per cwt. Free. 43d. Austria- Hungary. . 6d. per cwt. 6d. per cwt. 9ld. 8d. Switzerland . ■^M. 2.^d. to 4d. per cwt. gid. per ton. 93d. per ton. Greece IS. 3id. per cwt. IS. 7id. per cwt. tree. Jiee. Turkey 8 % ad valorem. 8 % ad valorem. 8 % ad valorem. 8 Jl ad valorem. Rumania .. 3d. per cwt. 7id. per cwt. Free. Free. Bulgiiria — 10 % ad valorem. — 8 ^ ad valorem. United States.. 20 % ad valorem. 4d. to 4 id. per cwt. ; 20 % ad valorem. £1 Ss. per ton. i6s. 8d. per ton. Japan . . — i{d. per cwt. — ijd. PORCELAIN. BOOTS AND SHOES. 1885. 1901. 1885. 1901. Per cwt. Per cwt. Per cwt. Per cwt. From To From To Hroni To rroin To £ s. d. £ s. d. £ s. d. £ s. d. £ s. d. £ s. d.T- £ s. d. £ s. .1. Russia 234 8 13 5 2 s4 12 8 3 II 16 S 23 12 »o iq 3 4 51 2 4 Sweden 13 7 166 5 73 I 13 " 252 6 12 8 14 I 25 8 9 Norway 13s. Free. 183 II 4 6128 16 II 16 18 9 Denmark . . 18 10 I 17 8 18 10 I 17 8 3 IS 3 5 12 «i 3 15 3 5 '3 " Germany . . 071 15 3 051 12 2 '55 ' 15 7 155 '"57 Holland . 5 ; ad valorem. 5 J ad valorem. ^% ad valorem. S% ad valorem. Belgium 10% ad valorem. 10,'^ ad valorem. 10^ ad valorem. lo'J ad valorem. France :•■ loj 082 040} 10 2 4J I 3l per pair. I 2J I 7J per pair. Portugal . . £-i 7 • 387 5 '4 4 II 01 loi per pair. 2 8i 090 per pair. Spain . . JLt I 4 114 4 ' 3 £'7 "5 7 ^l7 >5 8 Italy... .. 4 loJ 13 066 14 3 6 J loj per pair. 10 017 per pair. Austria- Hungary. . 071 15 3 051 10 2 ;Ci 15 7 £1 13 Swit;ierland 6s. 6d. 6s. 6d. 12s. 2d. 12 2 208 (jreece I 13 340 0160 II 4 465 ^800 8^ ad v.-ilorem. 340 48 Turkey 8% ad valorem. Z% ad valorem. i% ad valorem. Kumania .. 033 12 2 10 2 280 18 3 I 16 7 827 10 3 3 Bulgaria . . 12,^ — From n% ad val. to £•$ '3 9 per cwt. United From 55 % to 70,'^ From 55,'^ 1060^ .States . . ad valorem. ad valorem. 30,!^ ad valorem. 2$% ad valorem. Japan . . . . ' — .!>>X ad valorem. — 20'^ .id valorem. APPENDIX. 413 1 =■ -0 , * W3 r-i •0 TJ 10 1 » _o < S.N s " u. u< -0 £ fc ./ ^ in «Sj; > j; *■ t^ s * s > •0 ^ B-U ^ H> N •0 M a J Si p. 1 *« ^ H -f in w 00 ♦ m 65 p c* •0 ""d •y. i^-i • • ^; jj "O " ^S -d . J . "5 ^ -« . c n «> m « U T3 ■-' Jl t^ (J-TS *> > » \ < ii '■■■2u: ^ "s _. ai • ,; ^'i-ui 1 Di T3 "i*? 3 t3 00 . « ■« -d ■d „• s' ^ ai U U **^ -^O i" X W 1 S 12 5 (1, " n J rt " i! .> -d - 'Su.'^ "u, « " « " -d - '^■d •d -d -a rt s '^ d. !^ «> ■<■ jC <;2; 0! <: 1 ■2^ :d2. •0 g G J *: "-• . . t^ :§. . . . •a ss " t^ u ;> JJ 1 > 1 Oi "H « < i In 00 ^ e-T>: o^ o ; o ^1 o U = - rt<_ « rt .S \J '^n 4> W'^4J 4J li-rfS jj-d j; > j; -^-S-O-dTJ V « Q mc c >.C-d!S Q.rt3 ^"333 = 414 APPENDIX. TABLES XIII. AND XIV. {contiiimr}. B. — British Posskssions.— 1902. COTTUN \AKNS .\NI> TUKI'-AD, IKON jPh.l. Australian Commonwealth .. New Zealand *Dominion of Canada Newfoundland f Cape of Good Hope Natal . . . . Orange River Colony Free. Free ; 20% ad val. Free ; 15% — 25% ad val. Free(yarn); 25°-^ad val. (thread) |-7J% ad val. Free. Free. los. 3Jd. per ton. Free, I Free. COTTON MANUFACTURES. EXCLUDING GI.OVF.S, APPAREL, AND HOSIERY. IRON (IRON AND STREl. RAILS FOR Railways). Australian Commonwealth .. New Zealand *Dominion of Canada Newfoundland tCape of Good Hope Natal Orange River Colony Free ; 5% — 25% ad val. Free ; 10% — 25% ad val. Free ; 15% - 35% ad val. 5%— 40% ad val, >■ Free ; 7^% — 20% ad val. i2j% ad val. Free. Free ; 30% ad val. 30% ad val. 1 Free. WOOLLEN YARNS. CORDAGE. Australian Commonwealth . . New Zealand •Dominion of Canada Newfoundland tCape of Good Hope Natal .. .. Orange River Colony Angora Yarn . . Free. Other . . . . 5% ad val. Sewing thread . . "j Mending .. .. >• Free, Yarns for carpets ) Other . . . . 20% ad val. Certain kinds imported '\ exclusively for manu- > Free. factureofwooUengoods ; Other . . . . 20%— 30% ad val. All kinds . . 20 "< ad val. [aU kinds ,. 7i\' ad val. Fishing nets and netting ., Free, Reaper-binder twine,. sZ-percwt. Other , , . , 20% ad val. Binder twine .. ..^ Hawsers of 12 inches . . ( fj-^^ Some other kinds .. ..C Plain cotton or linen cord J Other .. .. 20% ad val. Harvest twine .. .-I Lines and nets for the > Free, Fisheries ) Twine for sails . , 5% ad val. Other . . . . 25% — 3S.% ad val. Lines for fisheries . . Free. Nets . . . . 20% ad va'. Other . . . . io% — 40% ad val, < Rope for engine belting,&c. ^ j i Hinder twine V S ( Sailmakers' twine ,. .. )^ ( ilht-r'. . 7^" a Free ; ^Vi ad val. Free. Free. Anthracite . . Free. Bituminous slack . . 2d% ad val. Other .. .. 2 5 6 per ton. Imported at Placentia I 2jperton. Imported at St. John's, Harbour Grace, and Carbinear 2/o!J per ton. Other ports . . . . Free. m/- per ton of 2,000 lbs. CANVAS & BAGS AND SACKS. PAPER FOR WRITING AND PRINTING. Australian Commonwealth . . New Zealand ♦Dominion of Canada Newfoundland tCapeofOood Hope Natal Or. Free. Woolpacks ) Other . . 10% ad val. Of jute ) p Woolpacks j''^^^- Bags, includO 0, ing flour bags > '"' Other .. 15%. 20% — 30% ad val. 35% ad val. Free. Writing (sheets under ) p^.^^ 16 X 13 inches) . . . . ) Other .. .. 15% ad val. Printing . . Free. Free. Writing .. 25% — 35% ad val. Printing .. 15/^ ad val. Writing .. 35% ad val. Printing .. Free. 1 Writing .. 7}"^ ad val. j Printing .. Free. PORCELAIN. CEMENT. BOOTS AND SHOES. Australian Commonwealth . . New Zealand •Dominion of Canada Newfoundland t Cape of Good Hope Natal Orange River Colony 20% ad val. 20% ad val. 30% ad val. 30% -40% ad val. |7i%adval. gd. per cwt. 20% ad val. 2/- per barrel. 67 d. per 100 lbs. 25% ad val. ■6d. per 100 lbs. Free. 15% — 30% ad val. Free. 20% — 22j% ad val. j Horse boots. .25'i ad val. ( All other ..30'; ad val. 40% ad val. Uj%adval. • A reduction of one-third on these duties i^> allowed to British ^;oods under the preferential tariff. t The above duties are for goods for consumption within the South African Custom Union. In transit to places outside the Union, goods are fre? or subject to a duty of three per cent, ad valorem. 4i6 ' APPENDIX. li X =;- ~ o -J •?■" .52 < .«<-5 if t>. ;^ (^ M w »^>p N in in m ro w ;* r^ M o*b c> Q Od Co « b b* V» '0.00 vo r^ 0\ o\ 0^ o^ 0^ r^^O en w r^ M 00 o» o^ H IJ » .«->0 DOOM -* 000 10 w i^M t^w t.*r.^Mco i^tv p> b^i> -^-MOOOI^M OQ^O-fO'Tit < S " J- »; moo 0. p< &. g 1 1 b b 1 '■«■ v.. i^O\o « mt-Moo moo -n M -^ moo -^-^M tNmM ocovo i^o ^^8 — u u3 in 00 m in m in iLz 1 1 1 M 1 1 1 m lb b b 1 ^ 1 1 1 1 i) 11 1 Qi ■^ |l m N t~ V b M Co 1 1 b i) 1 b 1 - b i.s ^ . 00 mo «1 £g 1 i 1 1 1 1 1 ■««'o>'m^ 1 1 1 1 11 1 1 1 1 1 1 -J Sf l! = 1 1 1 1 1 ^ 1 1 I 1 1 1 U 1 ■"" 1 1 1 1 1 1 1 •° c c ^^ 1 •'^ 1 i r -"^ 1 ■° 1 1 ■■" r 1 ] 1 ?" iT £:| M 1 M 1 1 1 1 1 1 I M 1 1 1 1 1 1 M ^ c ^£3 111 b-VV 1 N 1 mV, ■« b^ 1 b b-N m 1 « « U. „• ^ bi (S g 1 1 In m-M b 1 1 1 1 m V ON 1 1 b V 1 b b ca •c j2 is 1 1 b b^ b Vi H 1 b I- 1 b b b W V '10 >o V N m 'm 'in •^^ >, S S s 1 1 1 .'^ 1 .0 ."^ m -.j-oo M ■♦00 onoo m n m I w m c (5; 3 1 1 1 1 fi « ONmiboocimi-.VoViibl mw ^ 1% II •- -^ 1 1 1 1 -r 1 b b ■- •« 1 1 1 b 1 1 ! 1 1 d •0 £ c 11 ."«> 1 1 1 1 1 •" 1 1 •"' 1 1 1 1 1 1 1 1 1 1 B, 1 1 1- 1 i 1 .2 0.00000 « p>« 1 1 1 ."^ 3 6! 1% 1 1 b 1 1 1 Wi «o * -» M **• c> fof< t^Ooooo 0\ ts. 00 1 r*. t^ *o « w t^t^iO'-oovD « ►- 0) c-j ON moo 10 ■* ^'& fO ro^ tN. « I 1 lb I 1 M IS" O fO O O f o o ^ I |-«-S II -l^l I I -o 1^1 I I I I I l|-« < * I I I I M-« b I I'M 1 |-°bbl bV-n J3 1 u 3 _o 'J- ■0 5 c" '« * n • ■_o ■ .T3 . . C . a : 6 : ncluding Pepper) fined .. [irefined «j^ o-='a'a 3 s.Sr u n 4i8 APPENDIX. TABLE XVI. Statement slWiCiiig he Proportion per cent, of the Total Value of , the Articles of Fooil named ill Tabic XI'. imported into the United Kini^doin from Foreign Countries and Uritish'Posscssioiis, for the Vi'cns 1880, 1884, and igoj. COUNTRIES. A, — Foreign Countries. Russia ... Sweden Denmark Germany Holland Belgium France ... Spain ... Portugal Roumania China ... Argentine Republic ... Foreign West Indies ... United States Other Foreign Countries Total Foreign Countries 1;. -Bunisu Pos.sEssiONS. British India ... ... ... ... Australia British West Indies and Briiisli (niiana British Nortji America Other British Possessions Total of Briti.sh Possessions ... Total of Foreign Countries and liritish Possessions... Percentage of Total. 1880. 1884. 1902. 31 5-5 6-3 1-4 1-4 0-6 29 34 8-1 8-3 9-3 67 5-5 7-0 4 "4 I'D 1-3 1-6 7-6 7 4 60 II i-i 03 09 10 0-8 08 2-2 3-6 5 '3 4-6 0-3 — — 5-4 ro 07 — 35 "4 26*9 271 81 82-4 8-9 8-6 807 79-S 5-8 7-4 5 '3 1-9 2 "5 1-8 3-5 3' 10 3-S 3-9 7-4 2-6 2-4 i 47 17-6 "rj 20'2 APPENDIX. 420 APPENDIX. J) ^ o c 9 g IT) r-, t^ ro -. ro pN ^'^ pN>5 _-+ p |- 00 N N p in in^p p t^ ON „ sic o '— O t^O t^iO t^ b « ro ro Ih N N O CS 1-1 « n N M N *>-i '« c< s " ' " 1 « u-d 13 >^ ro NO n s B M o •3 4) e-K OK On On NO o St: « •-< •^ >-i Ili'^^N. \o On CO o 2w'-- "^ , Ct3 c ^ 1 _ c 3 S O ^ " N N vO r^ m On M OC O in M r^ >:}■ N 1 M r^ •^ O N NO ^ rt c4 o 1:^ OS rn O M fo Tt- — O CO -D "N in '•'1 Tj- - « 1 rn CJN On N COX) ,o E — Tj- in vo ly-l IT) ul insO vO o O O nO NO >0 vO NO 1 NO SO NO t^ i^NO t^ H < .'S 1 ■o 1 5 -•o •a O ro o o^ « . ' c rt ui Cn t^ o CI •-■^15 >- ^ ° n^ J! in l^ NO NO n > as? <: t s ^ 1^ "•C 3 OOO^l-lC^O „ fOvO vn O O N u-i m T in ro "- 0\ rO N N CO r}- N O CO ■* '■C^ o« o'u:oooooi^a\ 00 i-n N O CJN On On o N CO »*■ Tf CO CO > 1^ N C< N M N n C) N « « _ C) N M N N C< N c c et: — o o On c y. t^ On ON Cn >/■ ;i 0) aj-^ 1 y - 1"^ 1 ^ E !/■ § =so xi-io t^oo o i.2 « Tf ro M- rh t-^ OS O r^ m N — NO On O t^NO o 00 ■^00 f< l^ 5 w ■^ ^ rn in r^ On " "- On - - Tj-- O N Tl-CO tJ-nO N !- Z c = N N a N n M N M N ro ri M CO r<0 ro CO CO CO CO CO CO CO CO CO 2: < 'i 1 c rt ■d - O - "* cj 21 ^ - •* CO NO ^ < s y^ o N-l ^4 ^4 f^ y. 7. a >J c !^ ~ 1 f_. (^ a ; o "^ O "^30 t^ C^ •^ « 00 ^ CO in 00 NO •* N J^ in CO CO vn m CO •»*■ *^ o |-- iri LTi •"^ Tj- ■^ 1 •>;l- Tj- o m m m in in in in in in m NO NO NO NO NO VO -r; < i ' :^-o -o n O in o = a |x 7) CO t^ CO « v. < « On o ,^ ^ E C. •-^ " 1 " 1 ^ c: 5 — xi-) in in u^ \o m — m — O o 't in T*- On 'O in — t^ CO t^ - On "" C^ On 00 3 ■2 t^ OS r^ a> o CO O -n m 1^ r^ 't- t^ t^ O''^ ■o i->» o O = N M N N N M r^ fO ro ro CO fO CO CO CO CO CO CO ■^ COtJ- Tf CO ^ <: s [ T r—-. :::::.' On /-^--\ : : : : : t. V^ ::'.'•■ i. f : : : : : i •^ 01 1 ?^i l^ ^h •^00 : : : : : 5 oT : : : : : 2 j; 3 1) \ \ \ \ \1^ c M = rt' vO vO vO so "O <. o - N fi Tt 5 t^ t^ t^ t^ r^ "s inNO i^>3 o> i; t>, t^ r^ r^ t-^ <, o « N CO-* 5 00 oo 00 00 00 <; 00 00 00 00 00 CO CO 00 00 CO CO 00 CO CO CO 00 00 00 00 00 M n Ml _ M ►,«„«►, n M m M M APPENDIX. 421 „ 1 W 'A i Sji'i § c p [^ p p\fi 'P X C^ LO to ! m t^ 00 to ^ 'J- " 00 00 - '"1 -^ — lO r^ f^ r^ IS =vOO*0»Ot^vO 1^ t^ t^vO so l^ 1^ J^ t^ t^co r^ 'X Vi -x 00 ^ \< s " 1 c rt •6 00 ^ irt OS lish uce. mou He ■.; r*) N OS SO -iT0 t-» f^so "" '■'1 >* N OS "So -S-ooOM^O — to l^\0 ^ i^ LAt "-)00 OS -■ M On sO 1/-1SO to - .i: 1 g = ri M ro ro c-, co ro ro ro ro '■'^ <^ ro ro ro Tj- Tj- 1 ro 1- ■* ■ C « rts. nioi r H. » N N - a X a s? ^ '"' •- - - 1"^ 1 « a §30 vO OS •* t^ ! « w^ N Tf OSOO N so -< 10 f^oo so SO j.-iou^iOOvO »0 SO ^ ^ w^ LO \0 NO tOsO NO NO NO so so so NO < i 1 — •0 •6 " M r»i » c n ui if J, t^ tN. JJ 1 ^ M M i-i u-i ro ro N 00 Tl- .2 rs. Tt^ 00 N 30 M ro N ■* 'T 'i- Tf Tt ^ N M (N| CN| g — f> )vo 1^00 OS E " 00 CO X) ;/Doo < C - N m ■* c ys OS 0. On *t. "^sO r^oo OS 5 OS On OS CS OS *S ►- N c rt 000 -< . T Q, C U .3 l^° ^ « N N '!'=■ 1 * ■^ •5 ? w ^5 O •^ U ^ 4J _3 '^ vO ON'O i- t^ ^ Tt PI CO N CO 1^ 1^ c — — ''^ CN 10 NO 00 iO NO 5 a 10 rot^^O -^O 1^ r^ t^ On *i ^ B 2 vO^ M 1-1 r-, ON lONO NO < LT) VO t^ r^ t^ On r^ ONt^OO -■ ON C -c; ■^r! c/j-g <« c i T3.2 •a r^ -f '-' £~3 ss ,o *. ^a 2;_c a. yj ■^S S & o •^ '^•'^ a. ij •S^ T^-. ^ « I-, N N -c}- VOOO On On ^ 10 N N 2 S :: c VO 0\ "- " n 00 -r "^ 0-' ■"■ 3 i ^„ 1^ LTj C^ \j-)\0 N 00 NO ON «-• cr> E 3 hT ro On ■* M "^ 0^ vri t^ t^ I^ -< ^"S < U-) SO J^ t^NO ^ NO t^ On&O On On -i2 -^ H O :, ■S.= f5 C ,.-«. ^..i^ ^-^ •- S^ vO VO i-i S S VO vo NO ui "^ 00 VD c 3 "2 On,"* ON," NO "" 5 3 1 :? _^2. H C c 0) s 11 ~^^ U u U i^"^ %j c'^'c a 3"2 [5 ". "^ *-^ ^ ^ • "c 2 S|^ •* w^vO t^CO On < Q ►" M "-O •»}■ NO NO NO NO NO < c-^K to xr, 10 in 1/^ 10 03 00 iO c/2 CO C« 00 OD 00 00 00 c <0 APPF.XDIX. 423 ^ ° c ■3.2 -6 « „ u^ ■^ •^ u « »_ I3 1 ''^ M 10 "i- "> ^ { 0. *^ •* »^ h •^ ri fO ro fO a CO ^ u) « -0 ^ 2 a *j -3 vo «t>£l VO ^ CO •to ■+ M 't r>. ■+ ■* N CO N 't 'O VO ly. 1^ e SOW ro t-- VD SO T}- Ov M v.VO VO -0 — vO t~^ r^ 3 rt to N LO ^o q^ CT; ^ -t rO crv -t - (^ rO r>. tT q "1 ro .H Ifl -s ^ ,. .. . B < 3 m l^ ro ►- f ) 2' pf T? 0" -co' LO 'f --o rCi-C d^ 00 06 pT pj"od cf 00' u M N ►- « fl — « LT) LO ■'^f rO "^ ■^ ro (V) cs ro ro •* ■^ P^ P) rr g ;_j M t-l ^ ^ t-t t-t ►N »^ i-i "^ M4 l>H ^H *-« 1-4 Q — „• •0.2 -3 CO X t^ 't >; B *- y U B BCS w: N l/~, VO NM k. Q. "^ t; = ^? A (i;^ rrt r--. •+ LO a Cl< ^ :< W "rt ^ *D a w ^ N 000 t Cv VO N N CO vO CO vO PI OC CO >0 VO P) N ?> S c = t^ ■^^ Tj- M •* Cv r^ - Ov ro vC '■'•, Cv rf -■o P) ro r^ t^ Tj- r*^. CO "^ 3 ™ vo t^ 0^ -^^ « ro ^O vO CO - c. 10 ■* 10 r-» CO r^ rO VOOO "- 1- c^ 3 vo J" mT n' >0 6^ IT pf ri r? d 0* - CTv'-o' t-C ro C> — * 't- pT pP ro 0" < 2 « N fo n -•*•*•<*■•*' ro '*' "^ "*"£ ^ 10 CTv Cv 3N r^ c> 5 H " " "^ ■" " 1 1 3 c VO »^ vO m^ VO r-^ r^ 00 V c 00 CO 00 CO B "2 f^, i 'go ^ ^ a^ VO = X '3 3 --T t/1 ' A v2 D. 00 3 VO 3 VO 5 rC 3 j= ro :;; rO 71 ro ^ Cb, ^ e C c ci ti •^ — ^ oT 0" 0* tc Ul tiO Ci> r: « 1 rt w «oo Ov < •■ N ro '1- < •OvO t^OO Ov ji — VO vO vO vO 1^ t^ 1 ^ r^ 1^ t^ 1^ t^ 1^ 1^ 00 CO 00 >5 OO CO •>: c« jO 00 00 >5 CO >3 00 00 00 00 00 00 1 """"''""' M l-l M *^ ^ 424 APPENDIX. °d T3.2 T3 "1 "* ►^ 00 rt — V M • S3 ■Ji On 1^ ■* Tj- ^ a N- H^ .s ^ r^ ro ro •* o. O) "^ o a X «• ^ U 1 < g t^ O O O 30 N O f^CO On rO r^ 1/-NO ■* O NO Tt- * - O vr, ■~ N ro ro <^ •'T rn • n -^ m CNi M •■'"• ro ro -I- -tNO 1- •O NO t^ NO .^ - •0.2 -d o O O u~. « rt • Xa w \o CO iri N ^ a "- o. 1^ "^ >+ t Tf ■* ■■A ■X. 1 O c 3 ^ •^ VO vO ^ O t^ ^ r-, « CO ■^ ■* o CJN M CO O- — 't ">0 iriNO o O E < vO r^ On-O "^ "^ vO ^r "-) i^ r^co -O CO t^ I^ 00 S 1 Co 1^ S^ ^m CO ON C?N o « "^ 00 CO CJN c o •o a^ " CO 00 " M NO '^ ^ « N o ro O lO 0^° o" 1 ^i 00 3 fO 5 '■'5 5 00 ^ (!< c U c U c " ON : : : : : 1 >n C/D 00 t i : : : ; : o. . . . rt CO ON CO 8, ^ 1 1) : : : : : 1^ : : ; : : iT : : : V tfl tn CuO QjO C3 2 S' 2 11 11 OJ V lovo t^oo a\ i; On OS ON On On % On On On ON ON ii o — 0 >D 'yD 00 >D >D VO CO CO CO CO 00 >3 CO CO JO CO 00 On On ON 1 1 1 APPENDIX. 425 s H 2 O . z '^ o2 P D -1 a 5 5 !1 ^ < O U -. o fa « Q S z •< >< n a S S ~Q3 « ■r 5 = Cd -^ N- s " 2 H ? = »'0 >; a y. W c •0 rt 'S S 3 •6 00 u! 00 to 3 < ^O CO ■ VO Cs « "^ "^ '■'^ CTn 0^ 10 /d" r? 1~^ CI 00_ u-1 CO "^ t^'-O ■^ ro ro M u 0. E c •a. 2 "0 v: ON 00 c 3 B < 3 1-^ m H VO CvCO to Q t^ D vn •* vn ~ 00 i-T cf; cTo" On 00 "- N "^ "- U-) N 10 u-1 ro M ►" CO t^ 1^ CO c .2 S. 0. Thousands. (Census of 1850) CO c CO ?^ G u U > V c 3 -0 5 00 »i-i iri LTi tn 10 oociooooo;^ VO u-1 00 > < Q "- N fi Tf vO ^ vO 00 00 00 00 00 00 > 426 APPENDIX. 1 d •0.2 Srt •a t>. M fO M xs ■^ M a. ^ to o ui o a X M N N fO "^ ^ c -r) Tj- On N r'lO n (N O 00 "^ M l/^ t^NO CO Tj-00 ro vn w CO NO rf On c N On ■* n " 00 \D u-i>0 — "^ NO "- On tT « 00 ri 1/1 im/^ -^ ro P4 o rt tr) u-iiO — CO t ^ (N) (N) M NO q^ "*>:^>3 "t r^ NO — 1^ to O "^ B 3 00 t^ t-^>o" rC ./i CO o^ d\ uSoo' no' ■^ ON JnT >- LTi rf « ^f m" rC i-T VO < O M r« W-) >JTJ-) 'S- 1^00 OO O - On O O N ■* ■* N t^OO lonO "1 NO H t-t c •d N t^ lO t^ ^i. <;. 00 00 N ir> !r .° (i;^ s? „ N N N u "o a B "^ s? •J nn vO ro ■* N CT\ 0^ I^NO (N) ro On M fo ■^oo "^ o i-« " •* N NO ■* N -^NO t^NO rn c 3 c 00 N 00 "1 0^ ^ u^>0 t^ ■<*• C^ r^ On Q "1 O "^ O On r^ " ro NO l-l n vo N rOOO O >/-i Tl- M N - nO On t^ O (^ U1CO ro S = r^OO On "- Tf ro t^ i>^ r^ O 'f N CO P< ■-< -o O Tf NO O I^NO LO C7N <; o Tj-oo t^ t^OO r^ C/0 O N "-O - i-t O C O^00 On On CO >n Tj- Tj- r'l ro H O "o 'o !2 I^ 00 00 00 00 00 3 •S oo " OO " NO "* c ''^t; >n'~x 'o'r; n rt u-> o W-) 11 o 3 Q. o 2 o^' ^ 2 ro :;; ^oi ^li-s o' S "1 :« c M tZ c "S § c • u u lU U CJ ii U - .. CJ C^ 'I- On rf 3 1 i 1 i / ^ NO 1^ r^ 00 •^ 00 CO 00 00 o »-' ■■• •^ ^H (■I ^ .s ^ -3 OJ 11 -3 ■ t/3 t/3 e/) tfl rt rt R Lri Ix ^ u Jj y 1> ITivO 1^00 On > O « N fO 'i- -1^ "^nO 1^00 o < O ►" PI '■'^ ■^ > NO vo NO VO >o 1^ r^ t~~ r^ t^ r^ 1^ t^ 1^ »^ CO 00 00 CO oo 00 00 JO CO C/D OO 00 CO C« >3 CO CO 00 'yj CO CO CO 00 CO oo APPENDIX. 427 ■^i ro ■* rt'S ■d u rt W5 M o> « D. t/i *^ ■" *^ I. ■^ M '1 "■. ro "o X M c ^ "- OnVC N n vO \£> N r4 f^ "- Ln "^ "^ N 1-1 r'l vO •* CI „ 3 a .0 iri r<-> •^ tJ- 10 •* t^oo - t^oo 00 so 00 •- "^ u-> kM >0 X) On c « « M i-i « - « N N N M ts ro N M E '— < 'j^ f^ d •0.2 ■6 IM •M hN ^H acs 00 M t-< Q. CS^° V CJ N PI N a li a e '^ C 3 __ I^ - CO ro >3 N ro t^ N (^ 00 i^ 't LT, N rn rf 5 — ro <+ - LT, ") ^O t^o r^ ro SO U1 LO LTl (S Tj- t r^NO oc r~ "^ *"* *^ <: s • 10 00 00 '0 On _ 1 On 00 ? ) • *-* 00 •■• CJN ■a c^ i; Ci f^ S ro"^ z c rt 3 00.0 rj V- \o i2 ^ 3 a, 3 UT) TO 62.6: 5US ^■O TO ro : L| [— ( c G c *w •^ It U t/: U U^ ■ — ■ ._ C Ov ■* ON i : : N ^ 1 . . . • . u-> • ■ • irl 00 as ON .s 00 00 00 ON S, •^ •^ •^ ^ rn ^ .^ .« ^ T3 4> ■ ■ • * : u 0/ u V bo U) w M •a TO TO TO TO c w u u V u 0) •'I'O r^oo Os 5 «-« N ro •^ <; 0\ 0\ 0\ On ON < w-i»0 t~.oo o\ > < - N > CO 00 00 CO 00 ON ON On On 0\ goo yj 00 CO CO 00 00 CO 00 OO 00 00 00 ao 00 00 On CN ON 428 APPENDIX. u c'S • pi r- ^ ii: 'it ~ '? S S o "H&l u ■i^ 5- ~ c^ > 1.5. < ,< Ci c i; Ok. w -S'^ , o •C 5 'S- SiX i^ «4 n •= •5: « 2 ."2 0. u. a. w c ■a. 2 X-3 So ■6 • ro fO 00 00 fO c 3 < _ - ul " r<) c^ u~i 2 \0 Lpi r-^ * 0" "^ t^ "^ M ri ro ■* CO "^ r^ t^yj LOO M ^co 'O 0" 8 CO ^ ."2 a. CO X E c •a. 2 » CO ^ CO 00 CO < ■a "-> c - ro "^ "^ — 00 t-. vo d oo" lood t^ C\00 t^X) ro 10 *o 10 CO 10 r-~y3 •* ° " t ~ ° - co"vd" CO CO rl- Tj- VOO vD CO lO f^ c "3 a •A t» S 3 ~ « ^ g 00 il CO 00 ro— N B 1 >< PI f^ "* r^ r^ r^ 000000 •t 1 fl t^ 00 oT t/3 C3 V > < "%<0 t^OO On t^ 1-^ r~» t-^ t>. 00 00 00 00 00 1 >o r^ 00 aT tJ3 C3 < « N CO'* 0000000000 00 00 00 00 00 00 i V > < APPENDIX. 429 "n e •0.2 to ON ro fO 'I- c 3 i < si ;^ ■^ Tj- u-.o LTl ^O 000 vooo vO >-0 'T "^ -t 10 10 iOnO N 00 nO j^oo :>0 - CO N '■1 C) PI M 0^ N 10 S n •c S. a B 4 a T3 1 < s? ■- Tj- 1- m\o — —•-►-'-' M S oooo - CO r^ ON CT^ P4 S N "" " NO 10 rj- Tf ^^ « f VO r^ rt N M cs M 00 ON M 00 1-00 n M M CO 00 d a. Pi 10 00 00 i ^^ U C/D CO " c (LI u "lO On 00 " 00 >- fl 10 = B 0) 1 c u 00 00 00 00 00 00 00 00 00 00 0-. 1 VO 00 00 «r til n < " N CO "^ On On 0* On CJ\ 00 00 00 00 00 ON 00 nT t£ a 5 > -< vonO r^OO On ON On On On On 00 00 00 00 00 ON VO On 00 tB rt > •4- ^--i- CT> 0» On ( 8 On iT M n k« V > < n 5; X - y u •c -a ^1 .bs 430 APPENDIX. TABLE XXI. Statement s/ioa'i'iifi' the ]'aluc of the Exports of liiitish and Irish Produce in each of the years 1870, 1880, 1884, and 1902- classified as Articles 0/ Food, Kaui Materials, and Manufactured Goods; in thousands of Pounds — i.e., ico = ioo,coo.; Article.s E.XrORTHD. 1870. 1880. 1884. 1902. (a) Articles ok Food: — £ £ £ £ Animals, living : O.xen, bulls, cows, and calves . 41 60 130 96 Sheep anil lannbs 23 35 53 29 Swine 2 3 4 5 Leer and ale 1,882 1.734 1,642 1,786 Biscuit and bread 436 583 583 857* Butter 316 202 203 79 Cheese no 51 61 36 Corn, grain, meal and tlour : Wheat 544 34S 20 12 Malt 242 162 185 320 Oats 160 99 30 I Other kinds of grain 30 24 22 217 Wheat-meal and flour... 163 74 72 31 Other kinds of meal and flour . 6 12 25 370 Fish, fresh and cured 916 1.779 2,115 3.505 Hops 93 53 55 68 Pickles, vinegars, and sauces ... 470 679 i,38it i,5i6t Provisions, unenumerated 926 1.035 779 1.839 Spirits, British and Irish 183 544 811 2,808 Sugar, refined' and candy 934 1,127 I, III 399 , , molasses, treacle and syrup 35 186 176 16S Tobacco and snuff 89 32 26 7o7t Wine, British made 3 3 6 7 Other articles not specified 661 Total 7,607 8,825 9,490 '5.514 (f>} Raw MATKKIAL6 :— Clay, unmanufactured 98 163 181 507 Coals, cinders, &c. : Coals 5,290 7.837 10,25s 26,307 Coke and cinders 224 338 313 1,551 * Biscuits and cakes. i Includes confectionery -previously included with "Other Manufactured Goods" on page 435. X Prior to 1892, tobacco and snuff manufactured in bond were included in exports of Foreign and Colonial Produce, and with British and Irish Produce in that and subsequent years APPENDIX. TABLE XXI. {continued), 431 Articles Exiorteu. 1870. (/') Raw Materials [continneil) :— rioducts of coal, peat, or "\ shale, including naphtha, paratiin and oil thereof, and petroleum, pilch, and tar Copper, ore ,, unwrought, in ingots, 1 cakes, or slabs ... J Flax and hemp, dressed and> undressed ... ... | Grease, not otherwise described Hides, raw Iron : Ore Old, for re-manufacture Pig and puddled Lead, ore ... V pig Leather, unwrought Manure Oils Rags (e.\cept woollen) and other ) materials for making paper j Seeds of all sorts .. Skins and Furs : Sheep and lambs, undressed) (without the wool) ... j Foreign, dressed in the ) United Kingdom ... ) Unenumcrated ... Steel, cast in ingots Tin, unwrought ... Wood and timber, rough-hewn, ) sawn, or split ... ... j Wool, sheep and lambs, British J ,, not being sheep lambs, including (dressed in the Kingdom), and llucks and rajz-wool :p and "\ foreign United - 331 I 796 183 73 77 I 502 2,229 2 760 850 415 1. 405 390 ^37 257 164 130 12 633 43 5S1 166 1880. 1884. £ £ 492 1,069 i 8 1,054 1,053 III 158 2S5 194 379 137 27 1,165 5.219 4 357 1. 153 1,128 1,972 5 223 2,945 5 200 1,678 2,102 1,689 673 563 23' 232 715 346 673 7S2 256 187 399 186 19 ■ 469 55 7 1,187 826 547 Sir £ 1,458* 184 778 376 10 326 3,571 13 168 1,336 2,772 2,355t 379 366 427 546 490 142 735 25 929 2,84s * Not including naphtha, paraffin, paraffin oil, and petroleum. t Naphtha, paraffin, paraffin oil, and petroleum are now included under this heading. Prior to 1901 they were included with "Coal Pro waggons, trucks, &c. Motor cars anil cycles Other sorts Cement Chemical products or prepara- l tions, unenumerated, and [ saltpetre ... ... ) Clocks, watches, and parts thereol Coal, ciaders, iVc. : I'uel, manufactured Copper, wrought or manufactured: Mi.xed, or yellow metal for | sheathing ... ... I Unenumerated... Cordage cables, and ropes of ) hemp, or like material j Cotton twist and yam Cotton manufactures : Piece goods Lace and patent net ... Hosiery... Thread for sewing Ot her manu facts., unenumerated Total of cotton manufactures... 56,745 63,662 58,935 65,054 2,205 3,212 3,936 6,297 1,975 1,459 ',735 1,830 914 •77 63' 247 133 693 i,*52 442 970 143 834 1,006 66 r 1,171 453 214 1,005 442 277 1,634 613 433 1,224 88 3SS 366 76 2'5 693 504 7S2 759 i'577 890 374 520 2,606 4,842 3,793 5,168 146 >57 293 102 124 '97 .283 722 796 1,022 1,056 741 1,228 1,258 1,458 991 354 296 417 548 14.671 11,902 13,813 7,404 5-..W S39 813 1 , 208 1,578 57,678 1,974 943 2,073 994 51.665 2,453 i,oSo 2,477 1,260 55,215 3 ,066 458 3,628 2,687 Earthen and china ware (in- cluding bricks) ... 1,869 2,256 2,165 2,096 APPENDIX. TABLE XXI. {continued). 433 AlMlCLES ExiOKTEU. 1070. 1S80. £> iZl\. 1902. { Leather wrought, other articles, ) unenumerated \ 1,148 300 1,282 375 1,577 341 1,897 595 * Exclusive of surgical, .inaton\ical, and scientific with "Otlier .Manufactured Goods" for these years. C C instruments, which are included 434 INDEX. TABLE XXI. [ionti lined). Artici.ks Exported. ' 1S70, i 1S80. 1884. 1902. (c) Manufactured Goods £ £ £ £ Uonthmed) : — Linen and jute yarn , 2,434 1,212 1,452 1. 571 Linen piece goods (including'^ sailcloth and sails) and other ^ 7,549 5.835 5.181 5,430 linen manufactures ... ) Jute manufactures Lucifer and vesta matches Machinery and millwork : Steam engines, or parts of, | locomotive ... ... ' Steam engines, or parts of, ) other descriptions ... ] Not being steam engines, ) agricultural ... ... J Not being steam engines other descriptions ... Total machinery and millvvoik .. Medicines ... Musical instruments and parts ) thereof ... ... ... j Oil and floorcloth (including 1 indiaiubber cloth) ... J Painters' colours and materials .., Paper : Writing or printing r.nd en- ) velopes ... ... J Hangings Pasteboard, millboard, &c. | (including playing cards) J Unenume rated (and articles \ of paper, except papier- \ mache) ... ... ) Perfumery of all sorts Pictures, prints, engravings, ) drawings, iSic. ... ... ) Plate, gold and silver Plated and gilt wares Saddlery and harness Ships and boats, new (not re- gistered as British) machinery Silk, thrown, twist, or yarn Silk manufactures : Of silk only Of silk and other materials Soap 790 169 2,255 , '45 2,479 138 ' '.983 71 810 785 1,500 2,999 1,188 2,001 2,679 2,481 303 680 77S 812 2,993 5.797 , 8.117 1 13,162 5.294 615 146 219 SS4 428 119 19 84 [not re-) \, with>- — ^9.263 814 200 383 ','74 856 138 38 208 J3'074_ 893 265 635 1,294 1,107 158 45 19.454 1,368 264 1,466 1,972 1,122 194 68 356 102 108 141 '47 127 407 5SO 431 59 J31 327 67 167 436 60 261 381 65 464 583 — — — 5.870 ','54 684 613 238 ',035 i 1,603 407 440 1,209 967 548 94' 452 1,126 APPENDIX. 435 TAULE XXI. {iontiniud,. Articles Exfobtbu. 1870. i8£o. 1884. 1902. {c) Manufactured Goods £ £ £ £. [continncd) : — Stationery, other than paper .. ; 489 724 847 1,286 Stones and slates 279 261 353 328 Telegraph wires and apparatus ...| 2,523 1, 301 2,509 2,839 Umbrellas and parasols ... 253 458 582 426 Wood and timber, manufactured 237 364 389 565 Woollen and worsted yarn 4,995 3,345 3,891 3,530 Woollen & worsted manufactures: Woollen stuffs 4. 75° 6,736 7,93' 5.500 Worsted ,, 13,788 7,232 8,718 6,367 Blankets and blanketing ... 645 5^7 502 309 Flannels 366 310 410 299 Carpets, not being rugs ... 1-393 1,134 1,258 870 Shawls 117 158 200 90 Rugs, coverlets, or wrappers ... 151 361 329 556 Hosiery 266 320 4S6 953 Small wares and manufac- '\ tures of wool or worsted, > 190 418 302 310 unenumerated ... j — Total of woollen and worsted | 21,666 20,136 1,190 manufactures j 17,656 15, 254 566 Yarn, alpaca, mohair, and other ) sorts, unenumerated ... \ 189 878 I, /inc or spelter, manufactures 1 f '57 41 34 38 < )ther manufactured goods 3.034 5,917 6,324 5,533 Parcels post — — 3.478 Total 175.566 186,710 195.842 216,902 .Si \1.\1.\I^V Ol'' l'"i)Ki:G()I.Ni ; Taiu.e. 1870. 1880. 1884. 1 1 1902. Per Per Per 'pcr cent. . cent. cent. cent. Amount. of Amount. of Amount. of Amount. of Total Total Total Total IL £. C C Articles of Food Drink and Tobacco 7,607 4 8,825 4 9,400 4 I5,5'4 1 Raw Mateiials . 16,414 8 27.525 13 27,701 12 51 ooS 18 Manufactured (loods 175.566 88 186,710 S3 195,842 84 216 902 77 Total K.\pi>rts| of British and ] 199-587 100 223,060 100 233.025 JOO 283 424 'OO Irish Produce 1 ' 436 APPENDIX TABLE XXII. Statement showing the Proportion of Food, Raw Matciiah, and Manufactured Articles in the Domestic Exports of France, for each oj the Years i86p, 1879, and 1900, compiled from the French official Returns, and the " Statistical Abstract for the Principal and other Foreign Countries" (1902); in thousands of bounds, i.e., 100 = 100,000. Akticles ExrORTED. (a) Articles of Food : — Brandy, spirits, and liqueurs Butler and cheese ... Cattle, &c Eggs Fruit... Grain and meal Sugar, raw ... Sugar, refined Wines of all kinds ... Other articles of food Total of Food ... (/>) Raw Materials :— Cotton, raw ... Hides, raw ... Horses, mules, &c. ... Silk, raw and waste Wood for building purposes Wool, raw ... Other raw materials Total of Raw Materials (r) Ma.nui'actureu Artkt.fj Chemical products ... Colton, manufactures of ... Glass and glassware Gold and silver wares tHaberdashery, &c. ... Leather wares Macliinery ... Paper and cardboard Skins and hides, dressed ... £ £ £ 2,457 4.130 2,111 3. "6 2,665 2,951 1,351 S93 619 i>455 1,304 600 1,707 1.332 1,448 2,769 1,059 763 602 537 4,360 3.240 4.033 2,306 13.447 10,308 9,115 3.573 6,198 6,495 34.017 33.159 30,768 3,016 2,675 1,767 971 2,110 4,'52 788 638 770 6,245 6,344 5,428 1,292 869 1,994 1,787 4,689 8,067 7,383 21,482 7,885 25,3'4 25,210 47.492 1,424 1,500 3,534 3,074 2,633 6,900 9H 790 2,799* 954 2,316 1,159 6,220 5.565 6,172 3.9(^6 5,930 2,832 595 921 2,536 779 886 2,169 3,242 i 3.846 4,572 • Earthenware and glass. t Including umbrellas and parasols. APPENDIX. 437 TABLE XXII. (contimted). Articles Exported. 1 1869. 1879. 1900. (c) Manufactured Articles | £ £ £ {con/in ucd : — Tissues, silk 17,894 9,070 10,323* ,, woollen 10,732 12,371 9,089 1 Tools and other metal wares 1,510 2,711 3,8J« Wearing apparel 3,349 2,710 5-444 Woollen yarn 1,112 ',748 1.383 Other minufaclured articles 14,742 16,518 46,034 Total of Manufaclureil Articles 70,504 69,515 85,988 * Silk and waste silk, manufactures of, t Woal niauufactures. Summary of foriogoinc. Taiu.e. lAiiiouut. Percentage 1869. 1879. 1900. 1869. 1879. 1900. Food Raw Material . Manufactures... 34,017 21,482 70,504 33,159 25,210 69,515 30.768 47,492 85,988 27-0 170 56-0 26 'O 19-8 5^2 1 187 28-9 52-4 Total ... 126,003 127,884 164,34s 100 100 100 438 APPENDIX. TABLE XXIII statement showing the Piopoilioii of I'oott, A'nn' ^fatl•nals, and Manufactured A i tides in the I)omestic]ExpQits'of Germany for each of the Years i86g, 1879, and tqco, compiled from the official Returns of Germany and the " Statistical Abstract for the Principal and other Foreign Countries" (1902); in thousands, i.e., 100 = loo.oco. Articles Exiorted. (a) Food : — Animals living ... Heer Butter Grain and Flour ... Hops Sugar, raw Sugar, refined Other articles of food (including ) tobacco) ... \ Total of Food Marks {/)) Raw Materials :— Cotton, law Fuel Hides and skins (including ) leather) Horses Iron, pig ... Wool Other raw materials Total of Raw Materials ...i Marks Marks. 79,200 3,400 26,800 286,300 18,200 10,600 4,500 138,126 567,126 28,356* 61,865 97,200 30- 504 12,745 12,814 74,026 472,506 1879. Marks. 107,040 25.400 22,000 350,000 22,300 58,200 21,390 Marks. 8,038 22,228 5.632 134,990 25,286 II 1,192 105,146 154,640 I 105,488 75^,970 37,948 518,000 25,900 65,000 84,200 47,480 34,000 25,610 66,440 622,930 43.473 272,707! 10,327 10,242 21,930^^ 867,321 767,660 945 660 1,226,000 38,383* 47,283 I 61,300 J* The values for 1869 are estimated only, t Coal and coke. + Included in^lcattier wares, 5 Wool, raw. APPENDIX. TABLE XXIII. [colli! itiied). 439 Articles Exported. i86 1879. 1900. (c) Manufactured Articles: — Marks. Marks. Marks. Books, pamphlets, and other ) publications ) 23,000 22,200 148,930 Cotton manufactures 84,637 119,960 245,208 Glasswares and earthenware 51,500 55,000 46,676! Leather wares 3I.784 51.750 52,497+ Machinery 21,212 39,010 215,897 Paper and paper hangings 17,000 26, 100 74,128 Tissues — Silk 86,418 66,690 1 39, 522 J Woollen 161,502 142,100 178,251 Other kinds, and ready-made ) clothing ... ) 97,882 112,150 I3'.279ll Yarns, woollen 32,292 24,400 56,807 Other manufactured articles 270,050 411,660 1,578,205 Total manufac- \^^''^' 877,277 1,071,020 2,982,000 tured Articles ) j- 43,864* 53-551 143,400 Sr.MMAKY OF FORKCOING TaHI.K. Amount. Percentage. 1869. 1879. 1900. 1869. 1 1879. 19c 0. Food Raw Materials Manufactured \ Articles . J I 28,356 38,383 43,864 37,948 47.283 53,55' 138.782 i 25,900 25-6 61,300 347 143,400 397 1 27-3 34 -o 387 1 1 '2 266 62-2 Total ... 1 10,603* 230,600 100 100 100 ♦ The values for 1S69 are estimateit only. t^Hlass and glass wares. X Except glovcs.| /..'n— § Silk manufactures. II Wearing apparel. 440 APPENDIX. TABLE XXIV. Statement shoiciiig the Proportion of Food, Rate Materials, and Manufactured Articles in the Domestic Exports of the United Slates for each of the Years 1870, i83o, and igco, compiled from the Official Returns of the United States and the " Statistica Abstract for the Principal and other Foreign Countries" (1902), in thousands of dollars, i.e., 100 = 100, oco. Articles Exported. Years ended 30th June. Year ended 3istDecember 1870.* i88o.» 1 900. * (ri) Food : — Dollars. Dollars. Dollars. Animals, living 1.045 15,882 33.819 Bread and breadslufTs : Indian corn ... 1,289 53,298 84,285 Wheat 47,171 190,546 70,976 Wheat flour... 21,170 35.333 68,018 Other breadsluffs 2,621 8,860 27,507 Oilcake 3.4«9 6,260 17,115 Provisions : Bacon and hams 6,123 50,988 58,144 Beef, (resh ... j 1,940 7-442 29,308 ,, salted 2,881 3.156 Butter 592 6,691 \ 9,233 Cheese 8,881 12,172 lard 5,933 27,920 42,034 Others 5,707 30,949 28,437 Tobacco, and manufactures of 22,705 18,442 32,624 Other articles 1,364 8,467 83,512 ( Dollars 129,960 464,131 589,162 Total of ] ood . . . { ( £ 2i,66ot 96,694! I22,742t (/>) Raw Matkriai.s :— Coal 1,306 2,058 21,524 Cotton, raw 227,028 211,536 314,253 Naval 5.toies (resin, turpcn- j tine, tar, pitch, and spirits of J 3.277 4,585 13,030 turpentine ) * F.xclusivc of bullion and specie. \ In the year 1870 the conversijns have been made a( (lie currency rale of 3s. 4d. to the dcjliar, and in iSio and 1900 at tlic average rale of 4s. 2d. APPENDIX. TABLE XXIV. (continued). 441 Artulrs ExioiriED. Years ended 30th June. Year ended 3i-tDecember. 1870.-* i88o.» 1900.* (b) Raw Maieriais {continued):— Oil, mineral Leather... Tallow ... Other unmanufactured articles Dollars. 32.669 t 3.815 5,402 Do'lars. 36,219 t 7,689 1 2,46 f Dollars. 73.649 27,169 4.675 503 Total of Raw Materials. Dollars 273.597 45,6oo|! 274,554 57,199!! ((•) *.Manukacture:d Articles :— Agricultural implements Cotton, minufaclures of Drugs, chemicals, medicines, and dye stuffs (including acids) Iron and steel, and manufac tures of L'atlier, and manufactures of Wood, and manufactures of . Other mmufaclured articles . Toial of Manufactures... i Dollars 1,069 3.787 2,495 13.48 ■. 673 1.^.735 16,409 51,651 8,6o9i| 2,246 9981 3.531 14,716 6,: 60 16,237 31,791 85,262 17.763!! 535.594 111,58211 15.980 20,723 13,772 129,633 ii.5'4 136,631 328,253 68,38611 Sl'.\IM.\KY OF 1-ORKGOlNr. TaHI.K,. Amount. Percentage. 1870. 1880. 1900. 1870. 1880. 56-3 33-3 10 "4 100 1900. Food Raw Materials Manufaciurjd Articles ... 21,660 45,600 8,609 € 96.694 57,199 17,763 £ 122,742 111,582 68,386 302 710 28-6 6o'i 11*3 100 405 369 22"6 Total 75.869 171,656 100 " E.xclusive ofljullion and specie, t Included in niiuiuructured articles in the.sc year^. t Incliidiiis spirits. § Included in raw materials in 190}. II In the year 1870 the conversions h.ive been ni.idc at the currency r.Uc ul 3s. 4d. to the dollar, and in i8io and 19 x> al ilic average rate of 4s. 2d. 442 APPENDIX. TABLE XXV. Compilative Table sliou'ing the Population, Public Debt, Imports anj Expoits of the Australian Colonies and AVw Zealand for each of the Years — 1873-1901. {From the Victorian Year Book and other Official Publications.) VlCrORIA (87,884 S.UARE MII.F.S). Population Public Debt Year. on the 31st December. on the 31st December. Imports. Exports. Thousand T housand jC. Thousand £. Thousand jC- 1873: 772 12,446 16,534 15.302 1874 783 13.991 16,954 15.441 •875 791 I3,99i 16,686 14,767 1876 802 17,011 15,705 14,196 1877 8.5 17,019 16,362 15,158 1878 827 17,022 16,162 14,926 1879 841 20,051 15,036 12,454 1880 860 22,061 14,557 15,955 1 88 1 882 22,427 16,719 16,252 18S2 906 22,103 18,748 16,194 1883 932 24,308 17.744 16,399 18S4 961 27,527 19,202 16,056 1S85 — 31,535 18,045 15,552 1886 1,003 30,114 18.531 11,795 1887 — *33,i99 19,022 >',35i 1888 — 34,747 23,972 13.854 1889 — 37,627 24,402 12,735 1890 — 41,378 22,954 13,266 1891 1,140 4 1,610 21,712 16,067 1892 1,169 45,711 17,175 '4,215 1893 1,176 46,145 13,284 13,309 1894 1,183 46,548 12,471 14,027 1895 1,186 46,939 12,472 14,548 1896 1,180 46,886 14,55-; 14,199 1897 1,183 46,929 15,454 16,740 1898 1,183 47,058 ib,709 15,872 1899 1,189 4\354 17,953 18,568 1900 1,197 48,775 18,302 17,423 1901 1,209 50,014 18,927 18,646 1902 * Debt outstanding on 3otb une Tor this and succeeding years. APPENDIX. 443 TABLE XXV. (continued). NEW SOUTH WALES (309,175 s8 3.534 1883 287 14,908 6,233 5,277 1884 310 16,420 6,382 4,674 1885 — 19,321 6,422 5.243 1 885 323 20, 82 1 6,103 4,934 1887 *23,442 5,822 6,454 1888 — 23,442 6,647 6, 126 1889 — 25,962 6,053 7,736 1893 — 28,227 5,067 8.555 1891 394 29,556 5,079 8,305 1892 409 29,457 4,383 9,170 1893 418 30,640 4,353 9,633 1894 429 30,640 4.337 8,796 1895 441 3', 957 5 347 8,983 1896 450 32,941 5.433 9,164 '!97 460 35,070 5,249 9,092 1898 472 35,218 6,007 10,856 1899 482 35,227 6,764 11,943 1900 498 36,034 7,184 9,582 1901 5" 38,535 6,376 9.249 Debt outstanding on 30th June for this and succeeding years. APPENDIX. 445 TABLE XXV. {contiiiiml). SOUTH AUSTRALIA (903,^25 square miles). Population Palilic Debt Year. on the on the Imports. Exports. 3ibt December. 31st December. Thousand. Tliousand £. Thousand £,. Thousand £. 1873 198 2,175 3.841 4,588 1874 205 2,990 3.983 4,403 1875 210 3.321 4,204 4,805 1876 226 3,837 4,576 4,816 1877 237 4,737 4,626 4,627 1878 248 5,330 5,720 5.355 1879 259 6,606 5,014 4.763 1880 268 9,866 5.581 5,575 1881 2S6 11,197 5,244 4,408 1882 294 12,473 6,708 5,360 1883 305 13,893 6,310 ! 4,883 1884 ^^i 15.474 5.749 6,624 1885 1886 — 17,021 5,289 5.417 i^l 18,340 4,853 4.489 1887 — 19,168 5,386 5.441 1888 — 19,148 5.704 7,070 1889 — 20,435 6,999 7.380 1890 — 20,401 8,377 , 8,982 189 1 302 21,157 10,076 ' 10,656 1892 334 21,231 7.517 7,999 >«93 343 21,197 8,051 8,636 1894 347 *2i,753 6,316 7,529 1895 35' 22,oS8 5,681 7,353 1896 35^ 22,867 7,263 7,743 1897 352 23.9'4 7,277 7,071 1898 355 24,065 6,299 6,979 1899 359 24,673 7,016 8,547 1900 361 26,132 8,174 : 8,191 1901 365 26,449 7,478 8.319 * Debt outstanding on 30th June for this and succeeding years. 446 APPENDIX. TABLE XXV. (continued). WESTERN AUSTRALIA (975,920 square miles). Population Public Debt Year. on the 31st December. on the 31st December. Impoits. Exports. Thousand. Thousand £■ Thousand £. Thousand £. 1873 26 3 297 265 1874 26 119 364 429 1875 27 135 350 391 1876 27 •35 386 397 1877 28 161 363 373 1878 28 185 379 428 1879 29 361 407 495 1880 29 361 354 499 1881 30 511 405 503 18S2 3' 511 509 583 1883 32 611 5'7 447 1884 r:, 765 521 406 1885 — — 1886 — — — — 1887 — 1,281 832 605 1888 — 1,275 786 680 1889 — 1.372 S18 761 1890 — 1.367 874 672 1891 — 1,614 1,280 799 1892 59 2,262 1,39' 882 1893 65 2,260* 1,494 918 1894 82 3,232 2,114 1,251 1895 lOI 3,978 3,775 1,333 1896 138 4,724 6,581 1,650 1897 162 6,818 6,331 3.940 1898 168 7,900 5.242 4,960 1899 171 8,938 4,474 6,986 19CX5 180 9.87s 5,962 6,852 I90I 195 11,709 6,454 ■8,516 Debt outstanding .>n June joth for this and succLcding years APPENDIX. 447 TABLE XXV. {continued). TASMANIA (26,37s S(juARE miles). I'opulation Public Debt Year. on the on the Imports. Exports. 31st December. 3tst December Thousand £,. Thousand. Thousand £. Thousand £,. 1S73 104 1,478 1,107 894 1874 104 1.477 1,258 925 1875 104 1,489 1,186 1,086 1876 105 1,520 1. 133 1. 131 1877 107 1,590 1.309 I.417 1878 IIO 1.747 1.325 1. 316 1879 112 1.787 1,267 1,301 1880 115 1.944 1.369 1,512 1881 119 2,003 1,431 1.556 1882 122 2,051 1,671 1.587 18S3 126 2,386 1.833 1.732 1884 131 3,202 1,656 1,476 1885 — — — — 1886 — — — 1887 — 3.935 1.597 1,449 1888 — 3.981 1,611 1.334 1889 — 4,871 1,611 1,460 1890 — 6,029 1,898 1,487 1891 — 6,023 2,052 '.441 1892 150 5.922 1,497 ',347 'S93 '5' 6,375 1,058 1.352 1894 •53 7.339 980 1,489 1895 155 7.783 1,094 1,373 1896 '5» 7,782 1,192 1.497 1897 164 7.782 1,368 ',744 1898 168 7.721 1,650 1,803 189c) 172 8,254 1,769 2.577 1900 >73 8,511 2,074 2,611 1901 >74 9,096 i,96q 2,946 I90I TOTAL CO.MMON WEALTH {Imlinliiig Inlci-Slalc ria,!,:). 68,130 75,000 448 APPENDIX. TABLE XXV. (cofiiinued). NKW ZEAL.'\ND (104,027 square mii.es.). Population Public Debt Year. t n the 2i« t December. Thoui-and. on the 31st December. Imports E.\ ports. Thousand £. Thiusand £. Thousand £. 1873 296 10,914 6,465 5,610 1874 342 13,367 8 122 5,251 1S75 376 17,400 8,029 5,829 1S76 399 18,678 6,905 5,673 US77 418 20,691 6,973 6,327 1878 433 22, 60S 8.756 6,016 1879 464 23,958 8,375 5,743 1880 485 28.583 6,162 6,353 1881 501 29,659 7-457 6,067 1882 518 30,236 8,609 6,658 1883 541 31,385 7,974 7,096 1884 564 32,861 7,664 7,092 1885 — 35,790* 7,480 6,820 1886 589 37,588 6,759 6,673 1887 — 38,226 ' 6,246 6,866 1 888 — 38,326 5,942 7,767 1889 — 38,483 6,3c 9 9,342 1890 — • 38,802 6,261 9,812 i89( 627 38,845 6,504 9.566 1892 650 39,193 6,943 9,535 1893 672 39,729 6,912 8,98s 1894 686 40,837 6,788 9.231 1895 699 43,051 6,4CO 8.550 1896 7>4 44,367 7, '37 9.321 1897 j 729 44,963 8,055 10,017 1898 743 46,938 8,231 10,518 1899 1 756 47,874 8,740 11.938 19CO 1 771 49,591 10,646 13.246 1901 788 52,966 ii.biS 12,881 • Tlie figures arc fcr the ;ist of March for the year following that stated. Note.- In addition to the debts shown in the above table, the Colonies had Treasury and Deficiency Bills outstanding amounting to iQOi -' ^5,882,coo N..S.\V. ( /525,<-oo Vict. ,r^, '1 /li.coo.ooo W.A. ^ ■( jCyoo.voo N.Z. APPENDIX, 449 TABLE XX\\ {continued). Dominion ok Canada. (From the Canadian Statistics and the Colonial Abstract. ) Numhir of Population, Amount of Public Debt, and Total Value of Imports and Exports, including Bullion and Specie, in each of the years 1873 to 1901. Years ending 30lh June. I'opulation. Thousaiul. Debt.t Imports. I'ixporl-. Thousand £. Thousand j^. Thousand £. •873 3.686* 20,802 26,669 18,706 1874 "^ [ 22,568 26,711 18,615 1875 24,168 25,640 16,226 1876 Cannot be 2>,948 19,419 16,868 1877 1878 given. 27,757 29,242 20,693 19,392 15.807 16,526 1879 29,790 17,076 14.894 1880 L 31.761 18,019 18,315 188 1 4.325 32,374 21,944 20,477 1882 1 Cannot be ( 32,013 24.879 21,279 1883 ( given. { 33.014 27,553 20,435 1885 40,918 22,696 18.591 1886 4.726 45.855 21,755 17.761 1887 56,134 23-197 18,394 1888 58,462 22,787 18,535 1889 59,121 23,676 18.327 1890 58.790 25.039 19,880 1891 4.831 59.56S 24,651 20,223 1892 60,685 25,179 23.417 1893 61,655 2^522 24,363 1894 63,359 25.372 24,149 1895 65.352 22,763 23,350 1896 66,928 24,249 24,866 1897 68,328 24.497 28,346 1898 69,529 28,834 33,730 1899 70,023 33,445 32,650 1900 71.138 38,964 39,430 1901 5.'72 72.890 39,126 40,374 Ccnsu.s of 1871. t Total net habilities of the 1 )ominion and Provincial Goveriunents. Note. -In converting dollars into pounds sterling, the dollar is estimated at 4s. 2d. D D 450 APPENDIX. SUMMARISED STATISTICS Ol' THK POI'ULATIOX OF IHK UmI'KI) KlNGUO.M, ANU TIIKIR Condition krom 1840 to 1902. l.OvJAI. lNCt)MI-: TAX. NA 1 l< 1\AI, TA.XA'J'KJN. GKILAT BRITAIN I'lil'l LAllilN. Ki-;\i-.Nii-:. Dkht. Receipts uf Amount of Year. At the iiiidiUc Years ended Local Property. At., of the year. 3ibt March, Anncjiit on Authorities assessed. 3ibrt March. from all sources (a). [Years ended 5tli Ai)ril] (/'). In Milhons In Milhons In Millions Ill Millions Ill iMiMiuiis. ' i of^. .^f^. of £. ut £. 1902 42-0 1430 748 — 832-6 1901 41-5 130-4 691 135-4 799-4 1900 ! 41-2 1 119 8 629 121-9 758-2 1S99 40'8 108-3 628 I II -2 729-5 1898 40 "4 106 -6 634 101-7 701-9 1897 400 103-9 641 983 668-2 1896 39-6 102-0 648 921 671-5 1895 39-3 947 657 92-3 6521 1S94 38-8 {s)9ri (;-) 666 88-2 667-5 1S93 3^-4 (s) 90-4 (r)67i 82-5 674-0 1892 38-1 (.0 91-0 ('-) 678 76-6 673-0 ,1891 37-8 W 89-5 {>■) 684 70-5 66 1 -0 1890 37-5 (0 89-3 (ri 690 69-3 6320 1889 37-2 (.■)88-5 (0 698 671 6080 1888 369 89-8 (r) 706 66-8 600 -o 1887 36-6 90-8 736 66-4 593-0 1886 36-3 89-6 742 68-3 593-0 18S5 360 88-0 740 67-4 ' 595-0 18S4 357 86-2 746 ! 62-8 592-0 1883 35-4 87-4 754 64-1 576-0 1882 35-2 84-0 761 677 565-0 1881 34 '9 81-9 766 638 5490 1880 34-'^ 79-3 772 62-9 541 "0 1879 34-3 81-2 j 773 542-0 (fl) The receipts of local authorities include money borrowed, Goveriiiucnt contribu- tions, and receipts from sales of property, &c. (6) The tax was not extended to Ireland until the year 1853. (r) These figures are not properly comparable with those for previous years oil account of the cancellation of over .^30,000,000 of Stock in 1887-8, and the transfer of an eipiivalent amount of Local Loans .\s.scts to thi Local Loans Fund. The Local Loans Stock now amounts to about .£41,000,000. (s) Exclusive of payments to Local Taxation Account, consisting in 1890-1, 1891-2, and i8q7-i of half the Probate Duty, the proceeds of certain Licence Duties, and a portion of the Heer and Spirit Duties. APPENDIX. 451 .SL.MMARISK:!) brAlISriCS {.untmiuJ}. POI'ULATION. At the middle of the year. Years ended 3i!>t March. Amount un 31st March. In MilUuns. In Millions In Millions ,.f^:. 1878 33 '9 777 772 1877 33-6 768 770 1876 33-2 75-5 771 IS75 32-8 73-6 769 IS74 325 75-5 773 i«73 322 747 779 1S72 3i"y 731 786 1871 31 -6 68-2 7S9 1870 313 737 795 1869 31-0 717 Soo 1868 307 687 800 1867 304 68-6 802 1866 30-1 672 805 1865 29-9 696 814 1864 297 69-6 S18 '^J 295 699 822 1862 29 -2 693 822 1861 29 69-8 822 i860 28-8 70-3 823 '!59 28-6 64 5 829 1858 284 832 »8S7 28-2 1856 280 »8SS 278 1854 277 — — 1853 27-5 — — 1852 27-4 — 185 1 27-4 — — 1850 275 — 1849 277 1848 27-8 — 1847 28-0 1846 280 1845 27-8 1844 27-5 — 1843 ^7 3 1842 27-0 1841 20 -8 — 1S40 20 -5 Local TA.\ATIOM. Receipts of Local Authorities from all sources (a). INCO.MF. r.V.X. Gke.\t Britain. Amount of Property, &c., assessetl. [\'enrs ended 5tli April] (*). In Millions of^. In .Millions 45 '5 410 387 37-8 36-5 542-0 535 'o 544 "o 5360 515-0 486-0 4560 440 'O 4190 409 o 404-0 398-0 388-0 37 1 -o 3470 33 5 'o 328-0 3130 312-0 3050 304-0 2920 286-0 287 o 287-0 262 o 2590 257-0 2560 259-0 256-0 2550 253-0 244-0 244-0 251-0 (a) The receipts of local autlioritie., include money borroweil, C.ovcrniiient conltibu- lioiis, arid receipts from sales of properly, ^ic. (*) The u.y was not e.\tenilcd to Ireland until the year 1853. 452 APPENDIX. SUMMARISED STATISTICS [continue i). line \TKiN. Average attendance liMU.RATKlN. I>.\uim:ks. t'KiMi:. of Scliolars i n State-aideti Number in VL-ar. Schools. Number of receipt of relief Number of British and Irish Emigrants (rf). It tlie lK;j;inning of the year ('). Criminal Offenders convicted. - Great Britain. Ireland. In Thousands. In Thousands. In Thousands. In Thousands. In Thousands. 1902 5.537 487 2057 1,017 12-5 1901 5,368 482 I717 1,000 11-9 1900 5.292 478 168-8 1,00[ ii-o 1S99 5.249 514 146-4 1,012 11-8 IS98 5,160 519 140-6 1,032 12.5 1897 5.094 521 146-5 1,024 120 1896 5.016 535 161 -9 1,025 11-5 1895 4.900 520 185-1 1,015 11-9 1894 4.793 526 156-0 1,012 13-0 1893 4.643 527 208-8 973 13' 1892 4,409 495 210-0 951 12 6 189I 4,288 506 218-5 975 121 1890 4,231 489 218-I 990 12-3 1889 4,186 5c8 253"8 1,017 12-3 1888 4,111 494 279-9 1.038 13-b 1887 4,019 515 281-5 1,030 136 1886 3,915 490 232-9 1. 015 141 1885 3,827 502 207-6 987 14*0 1884 3.721 493 242-2 979 14-8 1883 3.560 468 320-1 1,015 15-0 1882 3,436 469 279-4 1,012 15-9 1881 3.274 {'^') 454 243-0 1,018 15-9 1880 3.156 (/) 469 227-5 1,044 15-6 1879 2,980 (w) 435 164-3 996 i6-8 1878 2,782 437 112-9 929 17-0 1877 2,511 418 95 '2 909 i6-3 1876 2,340 4«7 109-5 932 16-6 1875 2,176 390 140-7 1,005 15-6 1874 1,985 395 197-3 1,021 i6-i 1873 1,784 373 228-3 1,085 157 1872 1,651 («) 356 210-5 1,178 157 («/«) The decrea.se is stated to be due to exceptionally severe weather, and the pre- valence of scarlatina and measles. (><) The decrease is staled to be caused by the partial failure of the potato crop, and he prevalence of epidemics and distress. APPENDIX. 453 SUMMARISED STATISTICS {continued). ElJLCATION. Averajje of Scholar i ittendance n State-aided Emigration. PAUPERS. Nunioer in CRI.MR. Year. Schools. Number of receipt of relief at the licgrinning of the year W. Number of Great Rritain. IrelaiKl. British and Irish Emigrants (rf). Criminal Offenders convicted. Ill Thousands. Fn Thousand";. In Thousands. In Thousands. In Thousands. 187: 1,547 364 192-8 1,288 16 4 1870 1,454 359 202-5 [v) 1,279 18-4 1869 1,333 359 186-3 (^') 1,243 19-4 1868 1,242 355 138-2 (V) 1,237 199 1867 1,147 322 157-0 (z-) 1,149 19-5 1866 1,082 {0) 3«6 170-1 (-•')i,io5 190 1865 1,058 321 174-9 {v) 1,162 19-8 1864 1,011 315 187-I (f) 1,198 20-1 1863 1,009 297 1929 i-v) 1,329 21-5 1862 965 285 97-8 (-') 1,125 2I-C> 186 1 920 285 65-2 {V) 1,058 19-6 i860 884 (/) 263 96-0 [v) 1,010 17-5 'l^l 80 1 269 971 {v) 1,020 I7S 1858 761 266 95'i [v] 1,074 194 'fS7 627 269 181-1 {v) 1,014 22-2 1856 571 262 148-3 [v) 1,065 21-5 185s 53S 237 150-0 \v) 1,051 27-9 1854 461 254 267-0 {v) 1,036 iyi 1853 {'■) 345 278-1 [v) 1,046 32 3 1852 :-,7], — — {v) 1,110 J4-i> 1851 271 — — (701,176 390 1850 225 — {v) 1,336 41-0 1849 — — — (z'j 1,666 45-5 1848 — — — — 44-0 1847 — — — — 40 3 1846 — — 29-6 184s — ._ 27-2 1844 — — — — 29-7 1843 — 323 358 1842 — 1 — — 1841 — ! ' 32-2 1S40 — -- 34 'o ic) Kor ten months only. (/) 'I'he nationality of emigr.-ints wa? not ilistiiuuished l)eforc 185;. (e) The number of v.ngr.inls relieved is not included. (o) 1 here is no definiie expl.inalion of the decrease, but 37 teachers are reported to have been arresleil for complicity in Fcnianism. (/) Ihc ilecrease is slated to be ilue to the severity of the weather. {.■) These figures are exclusive of the " Casual Poor " in Scotland ing about 5,000. Scotland, probably number- 454 APPENDIX. SUMMARISED STATISTICS {aiili„i4 1872 1 42-5 36-0 2037 4,213 1,538 1871 415 368 199-7 4,375 1,320 (c) Until 1873, vessels engaged in liie coastinR iraile, carrying minerals, liritish timber, and Brit sh tiiiarried stone, fresh me.il, and fish, and a few oilier articles, were omitied Irom the coasting returns. The increase caused by including theve vessels was about \Vt million tons. (/; Vessels belonging to the Channel Islands and the Isle of Man .-ire included. APPENDIX. 457 SUMMARISED STATISTICS {continued). SlIIl'PI.N'G {conlinueJ). Total Tonnage Vessels belonxintj to the United I'otal Toimage of Vessels of Vessels Entered and Number of Kingdom on December 3: St (/(). Year. Cleared in the Persons em- Cleared in the Coasting Trade, ployed, exclusive Foreign Trade. 1 Cargoes only of Lascars. In Sailing. Steam. In Millions In Millions In Thousands In Thousands of Tons. of Tons. Thousands. of Tons. of Tons. 1870 36-6 36-6 i960 4,578 1,113 1869 34-9 359 195-5 4765 948 1 868 337 35-5 1975 4.878 902 1867 328 369 1963 4,853 901 1866 l^-l 37-2 196-4 4,904 876 1865 28-9 36-3 197-6 4,937 824 1864 27-2 35''3 1958 4,930 697 1863 267 35- 1 i8|-7 4,731 597 1862 26-5 349 1739 4-397 538 i!:6i 26-6 347 172-0 4.301 506 i860 247 34-0 171-6 4,204 454 1859 ! 22-9 330 172-5 4,226 437 1858 i 22-3 3i-6 177-8 4,205 452 •857 232 317 176-4 4,141 417 1856 21 6 305 173-9 3.980 386 1855 1 8-5 297 168-5 3.969 381 1854 iS-7 311 1624 3.943 306 1853 18-4 309 172-5 3,780 250 1852 i6-i 300 159-6 3.550 209 1851 i6"o 299 — 3.476 187 1850 14-5 30- 1 1514 3,397 168 1849 140 28-5 1526 3,326 160 1848 13-3 295 — 3,249 151 1847 14-3 28-8 — Z,'^^! 141 1846 12-4 287 3,069 «3i 1845 121 292 — 3,004 119 1844 103 259 — 2,93« 114 "843 9-8 251 — 2,898 no 1S42 91 249 — 2,933 109 1S41 94 25-3 — 2,839 96 1840 94 ~ 2,680 88 (a') L'lilil 137^, vessels engaged in the co.isiing trade, carryins; minerals, Uritish timber, and liriiisli qu.irried stone, iVesli meat, and fish, and a few other articles, were omitted from the coasting returns. The increase caused by including these vessels was about 4^ million ton!:. (/() Vessels belonging to the Channel Islands and the Isie of Man are included. I) I) 458 APPENDIX. SUMMARISED STATISTICS (continual). Kaii.wais. I..tters delivpred pur Year. head ol Receipts from Receipts Total Receipts I'opulation the Uniteil Passeiiijer Traftir. from Goods Traffic. from Passenger and Goods Traffic. Kiiigdoni. In Millions In Millions Jji Millions o(£ o(£. o(£. Number. 1902 47 "4 547 I02-I 61 1901 46-6 53-0 99 "6 59 1900 45-4 535 • 98'-9 . 56 1899 437 521 95'8 55 1898 41 8 49 "2 91-0 54 1897 40 '5 47-8 88 -3 50 1896 39-1 46 "2 85-3 48 i«95 37 '4 44 "o 81-4 47 1894 36-5 43 '4 79-9 46 1893 35-8 41 'O 76-8 •47 1892 35-6 429 78-5 47 i8yi 351 432 ■,&-3 47 1890 34 '3 42-2 76-5 45 188) 32 6 4I-I 737 44 188:5 31 38-8 698 42 1887 306 37-3 679 41 1886 30-2 364 66-6 40 1885 • 29-8 369 667- 39 1^84 390 37 7 * 677 38 1883 29 5 387 68-2 37 1882 28-8 377 66-5 36 1881 277 36-8 64-5 35 1880 27 2 358 ■ 63 34 1879 • 259 33 5 59-4 33 18.78 26-9 33-6 60-5 32 1877 26 5 341 6o-6 32 1876 262 33-8 60 -o 31 J«75 257 333 59 -o 31 1874 24 "9 32 56-9 29 1S73 239 31-8 557 28 1872 22 3 29-0 5>'3 28 1871 20 6 26-5 47-1 28 APPENDIX. 459 SUMMARISED STATISTICS {continued). 460 APPENDIX. SUMMARISED STATISTICS (continual). I.ciN'DDN Hankhrs' Clkarini; liANk ol- ENCLANU. Savings Banks. YEAR. HOI^SE. Amount of Amount of R« serve at the Amount of Deposits at the Averajje mini- mum Kate per Amount of Deposits at tlie Cheque , &c., end of eatli end of each cent, of !: passed. year. year. Discount. year 1). In Millions of v;. In Mi lions In Millions Per Cent. In Millions of^. of/;. of ^;. 1902 10,029 *i8-8 *47-o 3i 197-1 I9OI 9,561 *21'4 *48-6 3H 192-4 1900 8,960 *i8-o *47-o 3H 187-0 1899 9,150 *i6-3 *42-3 32 181 -6 1898 8,097 *i8-8 *4I-2 3i i73'i 1897 7,491 *i9-5 *43-5 2f 163-4 1896 7,575 ♦24-2 *49"o 2| 154-8 .1895 7,593 *33-6 *59-o 2 143-2 1894 (^'357 *23 *39-9 2^ 132-7 1893 6,478 155 338 3tu 122-8 1892 6,482 J54 34- 1 2k Il8'2 I89I 6,848 I3-I 36-0 3\ i'4-5 1890 7,801 14-8 39-8 4i 111-3 1889 7,619 9-6 28-6 3h loS-i 1888 6,942 11-6 28-3 3i 105-0 1887 6,077 120 27-8 3h IOI-2 1886 5.902 lO'I 28-5 3 97-7 1885 5.511 1 1 -4 29-1 3 94-1 1884 5,799 1 1 -4 34-1 2ifi 90-6 1883 5.929 12-3 30-8 3A 86 -8 1882 6,221 105 28-8 4^ 83-7 1881 6,357 106 305 3h 80-3 1880 5,794 12 9 33-5 2i 77-7 1879 4,886 15-0 38-0 2^ 758 1878 4.992 9 3 33-4 3i 74-7 1877 5.042 I2'2 26-1 2i 73-0 3876 4,963 155 31-0 2i 70-3 1875 5,686 9-2 27-5 3i 67 6 1874 5.937 io'4 26-5 3i 64-6 1873 6,071 1 1 -8 29-9 4i 61-7 1872 5,9«6 13-6 275 4i 59-0 I87I 4,826 15-3 302 2J 55-8 * Last day of second week of December. (0 The Post Office Savings Banks were established in 1861. The accounts for these banks are made up to the 31st December, and for the Trustees' Savings Banks to the 20th November. APPENDIX. 461 SUMMARISED STATISTICS {continuei). 1870 1869 1868 1867 1866 1865 1864 1863 1862 1861 i860 1859 1858 1857 1856 >85S 1854 '853 1852 1851 1850 1849 1848 1847 1846 1844 1843 1842 1S41 I S40 I.()NI>(lN HANK ill- KM. [.AM. lUNKI-Rs' .Sa\ IM.S K.ANKs. Housi;. An ount of Amount of .\verage mini- Amount of Amount of Re erve at the Deposits at the mum Kate {>er Deposits at the Cheques, &c., end of each end of each cent, ol end of each passed. year. year. Discount. year (0. In Millions of £. In Millions In Millions Per Cent. In Mil ions (£. 3.914 147 26-3 3^ 531 3,626 "•3 26-8 3i 51-1 3.425 9 9 26-8 2{ 485 — 136 25-9 2^ 46-3 -~ 123 27-3 7" 44*5 7-6 21-8 4t 45-3 9 '4 21-6 n 44*5 89 23-9 Ah 443 97 23-8 .2\ 42-3 IO-8 20 4 5I- 41 5 7-6 •9-3 Ak 4J-3 10-5 22-9 2l 39-0 — 133 227 3i 36-2 — 6-6 22-5 65 35"i — 60 17-6 5f 34-9 — 66 i8-2 4l 34*3 84 17-3 5, 33 7 8-8 22-5 3^ 33-4 — 125 21-6 2 318 12-6 18-9 3 303 10-4 20-2 2i 289 — 12-8 19-9 3 28-5 — 118 17-5 3! 28 I 8-4 17-5 S\ 302 — ■ 9-4 i8-o -1 1 0* 317 "2 7-5 l8-2 2i 307 9-8 157 3h 29-5 — — 4 272 — — A\ 25-3 — — 5 24 5 5 (0 The Post Omoe S.-ivinps Hanks were established in 1S61. The accounts lor these hanks are nmde up to the :,.st Deoemhc-r, anAL PKninCP.D.— Pr; Ikon PRdnrciai.— Avcr.igt* Gttzt //<■ i)rice of Vcar. Amount of. from British English Wheat per Ainount of. and Foreign Ores. Quarter. In Millions of Tons. In Millions of Tons. s. d. 1902 227 87 28 I I9OI 219 7 9 26 9 1900 225 8-9 26 1 1 1899 220 9*3 25 8 1898 202 8-6 34 1897 202 87 30 2 1896 195 8-6 26 2 1895 190 77 23 I 1894 1S8 7-3 22 10 1893 164 7-0 26 4 1892 182 67 30 3 189I •85 7-4 37 1890 182 7-9 31 II 1889 177 8-3 29 9 1888 170 8-0 31 10 1887 162 7-6 32 6 1886 I'^S 7-0 31 1885 159 7-4 32 10 1884 161 7-8 35 >•> 1883 164 8-5 4' 7 1882 : 156 8-6 45 I 1881 154 81 45 4 1S80 •47 77 44 4 1879 134 60 43 10 1878 133 6-4 46 5 1877 135 6.6 56 9 1876 133 6-6 46 2 1875 132 64 45 2 1874 125 60 55 8 1873 127 6-6 58 8 1872 '23 67 57 I 87 I 117 6 6 56 8 APPENDIX. 4<53. SUMMARY OF STATISTICS [cntimied). Coal prodi'cf.d.— PIG Iron Prodtcrd.— Average I'.asftte price of Year. Amount of, from British Hnglish Wheat per AlIKIllIlt of. In Millions nf Tons. and Foreign Ores. Quarter. In Millions of Tons. s.