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THE AWAKENING OF 
 AN EMPIRE 
 
J 
 
THE AWAKENING OF 
 AN EMPIRE 
 
 BY ROBERT GRANT WEBSTER 
 
 LL.B., J. P., F. R.C.I. 
 
 Formerly Member of Parliament for East St. Pancras 
 
 AUTHOR OF "THE TRADE OF THE WORLD" 
 "JAPAN FROM THE OLD TO THE NEW " ETC. 
 
 LONDON 
 
 JOHN MURRAY, ALBEMARLE STREET, W. 
 
 1917 
 
All Rights Re»bkvbd 
 

 TO 
 
 THE SONS OF THE BRmSH EMPIRE 
 
 NOW ON 
 
 ACTIVE SERVICE 
 
 THESE PAGES ARE INSCRIBED 
 
 ivi832057 
 
PREFACE 
 
 There is in this country no lack of energy in some 
 directions, whilst in others the vis inertice of our 
 countrymen is abnormal, and nothing short of the 
 vast upheaval which the determined effort of the 
 Central Powers for world domination has caused could 
 have aroused us, more especially our ruling classes, 
 from their laissez faire attitude towards our industries, 
 trade, and commerce. Someone in the middle of last 
 century invented a catch-cry, and called it " Free 
 Trade " ; whether that was ever realised in fact no 
 one amongst a certain sect of our politicians either 
 knew or cared. It was a good election cry and that 
 sufficed. If some statesman or writer tried to awake 
 them from their lethargy and pointed out to them 
 that we were selling our birthright as a great industrial 
 and agricultural country, not for even a " mess of 
 pottage," but for a phrase expressing an unrealisable 
 ideal, they replied by making utterly unreliable state- 
 ments and compiling statistics, plastered the walls of 
 our cities and towns with pictorial lies, in the shape 
 of big and little loaves and other mendacities, allowed 
 our foreign competitors and present enemies to annex 
 the products bountiful nature had placed in our 
 territories, also to undermine and destroy our manu- 
 facturing interests in many directions, and permitted 
 
viii PREFACE 
 
 our agriculture to go from bad to worse, so that four- 
 fifths of the population now has to depend on its 
 supply of bread-stuffs from overseas. This state of 
 things would have gone on interminably had it not 
 been for the great war which has caused us to revise 
 many of our ideas, and, let us hope, has roused us to 
 the parlous condition of our one-sided economic 
 system. 
 
 There appears to be no doubt that victory will 
 sooner or later crown the arms of the Entente Powers 
 and their Allies, but it will be neither thorough nor 
 complete if the economic underground working of the 
 Central European States is allowed to be renewed 
 as in the pre-war period. 
 
 The reconstructive policy advocated in these pages 
 is one which will tend not only to remedy the glaring 
 defects in our present ill-conceived, narrow-minded, 
 and inadequate economic system, but also, it is be- 
 lieved, will remove numerous other evils by which our 
 crafty competitors in the Central Empires have taken 
 undue advantage of our haphazard policjT- and fatuous 
 good nature. It will enable us to further the de- 
 velopment of our immense Imperial revenues and the 
 material welfare of the peoples under His Majesty's 
 sway — well-nigh one-fourth of the human race — and 
 also further to consolidate and cement our relation- 
 ship with those who have rallied to the flag in the time 
 of danger and stress, and who are fighting and dying 
 alongside of their brothers from the Mother Country 
 in support of those ideals of civilisation, liberty, jus- 
 tice, and honour which are dear to us all. 
 
 This policy of reconstruction must also be one by 
 means of which our gallant allies shall be enabled by 
 
PREFACE ix 
 
 every practical means to restore their material wealth, 
 happiness, and prosperity in the cycles of peace that 
 we hope will ensue ; and it must ensure that we do 
 not recklessly hand over again to Germany the 
 natural resources of our Empire, whereby they may 
 once more accumulate the sinews of war, and make 
 preparations in the future to again disturb the peace 
 of nations, deluging the world in blood, and horrifying 
 mankind by acts of murder, rapine, sacrilege, and 
 arson. 
 
 The great question of our country's future appears 
 to be not under what system we are most likely to 
 have single years of prosperity followed by four or 
 five years of stagnation, but how we can best preserve 
 a steady, continuous, and, if possible, an increasing 
 commercial intercourse both with foreign nations and 
 the British Dominions and Colonies. 
 
 We all admit that Great Britain was unprepared for 
 war on a large scale in August 1914. We had warn- 
 ings, yet, as a nation, we did not take them. No 
 satisfactory explanation of the pertinacious and 
 feverishly irritating activity, in season and out of 
 season, of the German Foreign Office was given us 
 during at least a decade before war broke out, nor of 
 its meddlesomeness outside its sphere of influence in 
 Morocco and elsew^here, although, in spite of the fact 
 that dust was thrown in our eyes by some of our 
 Ministers, we could not be blind to the rapid increase 
 of their Fleet and of their already immense Army. 
 The warning voice of such true and tried friends as 
 Lord Roberts went unheeded amidst the jar and 
 strife and the comparative trivialities of party politics. 
 We were, in fact, doped and lulled into a feeling of 
 
X PREFACE 
 
 false security by men like our then War Minister, Lord 
 Haldane, with his oleaginous and honeyed words, who 
 cried peace when there was no peace. 
 
 Fortunately those responsible for the efficiency of 
 our Navy stood to their guns, and had the courage to 
 spurn either the attacks or the cajolements of the 
 Keir Hardies, Kamsay Macdonalds, and other Little 
 Englanders and false prophets. To them we owe a 
 debt of deep gratitude. Many of the guardians and 
 seneschals not only of our Imperial security, but of 
 our very existence as a free people and a nation, were 
 slumbering in the guardroom, and drowsily replying 
 to any urgent call from the keen and alert watchmen 
 on the castle walls with such expressions as "wait 
 and see." Ireland, the Welsh Church, and social 
 reform must be attended to first. So they let the 
 crafty enemy approach well-nigh up to the very walls 
 of the castle ere they would listen to the insistent call 
 of alarm, and rush to arms. 
 
 To drop this metaphor, who can say how much we 
 owe to the gallant Belgian defenders of Li6ge, who 
 checked the onset of our foes while we were preparing 
 to encounter them, to the bravery and self-sacrifice of 
 " the first hundred thousand " of the splendid soldiers 
 we sent to France — few of whom, alas ! will ever see 
 the shores of their native country again — ^and to the 
 greatness and gallantry of our French and Russian 
 Allies in September 1914 ? 
 
 The question we shall have to face when this war 
 terminates is, are we to be equally unprepared (and 
 equally fortunate) in meeting the determined attack 
 on our industries, material resources, trade, and com- 
 merce, which our vigilant and determined foes are 
 
PREFACE xi 
 
 preparing for us, or are we to take due and fit pre- 
 cautions beforehand to the mutual advantage, not 
 only of the British Isles, but also of the United Empire 
 over which His Majesty rules, and of our Allies, who 
 have fought the good fight for civilisation, freedom, 
 and justice by our side, so that we may encourage 
 their industries and general prosperity as well as our 
 own ? The fact is we must let the general welfare 
 and employment of the industrial classes, in the field, 
 in the workshop, and in every other calling, busi- 
 ness, or profession, be more our true aim than 
 the worship of temporary cheapness from dumped 
 foreign productions or goods, and make our country 
 what it once was, one of the most productive food- 
 growing countries in the world. Possessing within 
 the confines of the Empire the vast natural resources 
 we can command, we must spare no effort to encourage 
 their use or development, and make it, as far as is 
 practicable, self-contained, certainly in regard to food, 
 raw products, and manufacture, rather than dependent 
 (as we were in 1913) for such articles as sugar to the 
 value of fifteen millions sterling annually on possible 
 enemies in the Central European Powers, whilst 
 allowing tons of millions of the best cane and beet- 
 sugar grown in the world to run to waste in our terri- 
 tories. 
 
 An effort must be made to avert the great dangers 
 we have run for the last few decades, dangers which 
 might have proved our undoing had not the deter- 
 mined love of country and pride of race of the mass 
 of the people responded nobly to the call to arms. 
 Britain's sons silenced, by their unselfish patriotism, 
 the frothy politicians whom the Germans fondly 
 
xii PREFACE 
 
 imagined voiced the views of their countrymen, and 
 to the grand rally of the men of the Motherland were 
 added the loyalty and attachment of the Dominions 
 to the land from which they sprung, which have helped 
 us to pass undaunted through the fiery furnace. 
 
 We have acquired new strength and hope for the 
 future ; we see the possibilities of our Empire and 
 our race with a clearer vision, and let us hope, as a 
 people, we have thrown aside our narrow-minded 
 partisanship and our devotion to ideals which are 
 quite unsuited to the age we live in. Those, once 
 counted by the score, who looked at matters from an 
 Imperial standpoint, can now be numbered by the 
 thousand. We have awakened to the fact that it is 
 our undoubted duty not to let other races and other 
 peoples filch away our natural resources and our in- 
 dustrial prosperity, but to develop them ourselves, 
 and hand down to our descendants that goodly heri- 
 tage for which not only our ancestors fought and died, 
 but for which the British, Anzac, and Indian heroes 
 of to-day have laid down their lives. We have rea- 
 lised, too, that we must organise, leaving nothing to 
 chance, consolidate and unify our interests, and make 
 the development of the vast resources of the Empire 
 and its economic prosperity our paramount task. 
 
 As the Motherland of a free and united people we 
 have received a great trust, and we must sanctify that 
 by guarding the interests of peace, aided by our tried 
 friends and Allies. If we do this with earnestness 
 of purpose the sorrows and sufferings of this great 
 war will not have been borne in vain. 
 
 It has not been in the past the privilege of any one 
 party in the State to strive to see ourselves united to 
 
PREFACE xii 
 
 the Colonies in community of interest. Patriotic 
 men of all parties have done so in the past and will 
 do so again. Our aim must be, as far as any human 
 effort can achieve it, to make such a reconstruction of 
 our economic system as will give a hope of prosperity 
 to our workers within the Empire that will not die 
 away and be succeeded by industrial depression, re- 
 duced wages, and a fierce struggle for employment. 
 Free-import trade, our present system, cannot achieve 
 that, for if fiscal barriers are erected by the order of 
 foreign autocrats, governments, or assemblies, we 
 have no power of retaliation, and have to take the in- 
 jury to our commerce lying down. The foreigner 
 knows this, and, in consequence, has in the past taken 
 such liberties as he saw fit. 
 
 We must look at questions relating to our industry 
 and trade from a business standpoint rather than 
 from a Utopian and sentimental one. Important as 
 the cotton industry is, for instance, it is not the sole 
 mission of the Anglo-Saxon race to spin it into fabrics 
 for export. From time to time in the past, as one 
 by one our manufactures have been destroj^ed, or our 
 agriculture has become more and more unprofitable 
 and depressed, our ministers have made sympathetic 
 speeches. What is required, however, is not so much 
 sympathy as prompt action. In the construction of 
 a railway you require a datum line on which to base 
 your gradients ; similarly, in regulating your com- 
 mercial interests and safeguarding your industries 
 you must have a standard in the shape of a general 
 tariff which you can remove wholly or partly in favour 
 of your fellow-subjects beyond the seas, your allies 
 or friends, or increase, if need be, should you find 
 
xiv PREFACE 
 
 undue fiscal barriers erected against your trade and 
 commerce. In this work it will be my endeavour, 
 therefore, not to dogmatise in respect to minute 
 details, but to suggest certain broad principles on 
 which a satisfactory trade policy might be based. 
 The public mind is obviously more plastic now. People 
 recognise that the hide-bound dogmas of certain 
 doctrinaire professors have not in seventy years con- 
 verted one single nation or self-governing British 
 Dominion to their so-called " free trade " ideals. It 
 must be disconcerting to them to see how little head- 
 way they have made, and how steadfastly the world 
 has refused to follow their lead. Yet one is unable 
 to proceed on the assumption that the national 
 economic policy has no relation to security and 
 general prosperity. That assumption, which has 
 been dinned into our heads by these false prophets, 
 nearly caused us grave disaster when the war broke 
 out. A people that attempts to treat industry and 
 trade as if they had no relation to the general 
 welfare of the community and to the safety of 
 their country, that believes the sole end and object 
 of trade is comprised in the word " cheap," that 
 allows the natural resources of their country, amassed 
 through ages, such as coal and iron, to be sold to 
 foreigners, that is content to live, in fact, on their 
 national capital in order to pay for the bread they 
 eat, while they are too negligent, careless, wanting in 
 foresight to grow sufficient grain for themselves, may 
 temporarily make great strides, but a day of reckoning 
 is sure to come, as, indeed, it nearly came to us. 
 
 In this work I have no individual interest to serve, 
 no wish to support the views of any particular party 
 
PREFACE XV 
 
 or section of the community. My sole aim is to do 
 what lies in my power towards indicating some of 
 the lines on which, within the mighty British Empire, 
 and in co-operation with our Allies and other friendty 
 Powers, a well-balanced system of mutual inter- 
 change of commodities, and a continuous, not merely 
 a spasmodic, prosperity may be established. 
 
 Robert Grant Webster. 
 
 February 1917. 
 
CONTENTS 
 
 CHAPTER I 
 
 BY WAY OF INTRODUCTION 
 
 Imperial solidarity — Is the lesson the war has taught to be for- 
 gotten ? — Is laiasez faire still or not to hold sway ? — Free 
 Trade is a myth — We must recover our economic bargaining 
 power ........ pp. 1-8 
 
 CHAPTER II 
 
 "WATCHMAN, WHAT OF THE NIGHT?" 
 
 A revision of old-world fiscal ideals needed — The " dumping " 
 system and its evils — Bastiat's views of a bad and good 
 economist — To defend our industries power of retaliation 
 needful — As important to sell as to buy — Internal trade of a 
 country the most important — We have strenuous commercial 
 competitors — Fluctuations in prosperity of industries — Recent 
 commercial legislation and its evasion — Suggested remedies — 
 International banking — Industrial banks — Profits of the money 
 market — The after- war onus of the National Debt — We must 
 cast aside and, if needful, reform old methods — Need of pre- 
 paring for after- war industrial competition — Political economy 
 as taught at the Universities — The above compared with 
 method adopted for examining Chinese officers — The question 
 of economic change should be a non-party one — Mr. Bonar 
 Law's views — Necessity for an import tariff — Industries 
 which should be restored — If a manufacturer cannot make a 
 profit he closes his works — Our natural advantages for com- 
 merce — Our canal system might be improved — Prohibition 
 not a policy, but a negation of one — The proposals sometimes 
 made to remedy stagnation in trade — Permissive legislation is 
 2 xvii 
 
xviii CONTENTS 
 
 useless— The metric system of weights and measures should 
 be adopted — The via inertice or " wait and see" policy depre- 
 cated — Free Trade only an abstract proposition — Commercial 
 rivalry betwixt nations ..... pp. 9-33 
 
 CHAPTER III 
 
 DANGERS OF ECONOMIC DEPENDENCE 
 
 Great Britain's economic organisation material to her welfare — 
 Recent colossal imports of food-stuffs into United Kingdom — 
 Too great reliance on outside supplies of food a national weak- 
 ness — Our dependence with Germany's independence in that 
 respect compared — The neglect of agriculture has caused 
 migration of population from country districts — A review of 
 the national economic policy needed — Heavy taxation on 
 land — The cause of the cost of bread not solely the price of 
 wheat — Registration duty on wheat in 1900 and its incidence 
 on prices — Food as dear here as in protectionist countries — 
 "Hungry forties" and their true cause — Royal Commissions 
 respecting agricultural depression — Witnesses gave evidence 
 of only effectual remedy for depression — " Free Traders' " 
 prophecies not realised — The home production of meat — Con- 
 fidence and industry the life-blood of agriculture — The consumer 
 requires a permanent cheapness, not a temporary one — Open- 
 ings after the war for employment — No recent reclamation of 
 land — Decrease of arable land in the United Kingdom — We 
 have adopted a similar agrarian policy to that of the Roman 
 Empire — The cause of agriculture not attracting men seeking 
 for an opening — W^hy the farmer prefers using his land for 
 grazing purposes — Steps should be taken to encourage more 
 intensive farming — Sources of our food supply — The United 
 States has become an importer of beef, not an exporter — 
 Report of Royal Commission as to the incidence of Protection 
 — The question of our food supply a purely economic one — 
 Our external food supplies — Canada's great future foreseen by 
 Lord Beaconsfield — Our decreasing food supply a national 
 danger — Progressive advance of agriculture elsewhere — De- 
 crease of arable land and the agricultural population a loss 
 to the country — Relative food-producing power of land under 
 crops and under grass — Regarding minor agricultural products 
 — The ideal and the practical in home production — The in- 
 
CONTENTS xix 
 
 crease of land under cultivation wovild cause more employ- 
 ment — To encourage home agriculture an import duty of 
 foreign produce preferable to a bounty — No complaint is heard 
 by the free-import traders as to the present great rise in the 
 price of wheat — Land reclamation — Industrial farms and co- 
 operative colonies — A great task of reconstruction lies before 
 us — Is our position as a great manufacturing nation secure ? 
 — British share small of increase in cotton industry of the 
 world — Our production of iron less than that of the United 
 States or Germany — The Canadian preferential rates aid the 
 woollen industry — Unless the capitalist feels there is fair 
 security won't embark in industrial enterprises — Are we willing 
 to face after- war competition without any preparation ? 
 Organise and set our economic house in order . pp. 34-66 
 
 CHAPTER IV 
 
 IMPERIAL UNITY 
 
 Co-operation of all within the Empire — Loyalty of the Dominions 
 to the Mother Country — We have hitherto declined to join 
 economic forces with Greater Britain — It is now the parting 
 of two ways — The resources of the Empire are boundless — 
 Preferential tariffs — Imperial federation — The difBculty of 
 framing a Constitution to meet modern requirements was 
 solved by the Japanese — The grant of fiscal autonomy to the 
 Dominions — Canadian and Australian preparation for after- 
 war conditions — Great Britain and a strong national policy — 
 The Empire's great industrial resources — Regarding the wolfram 
 industry in Cornwall — What suited the youth of the Empire 
 is not adequate now — Foreign affairs mainly controlled by the 
 executive — India, and German attack on her industries — A 
 mode of defence pointed out if we had retaliatory powers — 
 All the Colonies have refused to adopt the " free-import trade " 
 system — The British Empire controls one-third of all the 
 international trade of the world — Mutual and reciprocal Im- 
 perial trade — The Colonial Empire in 1837 and now compared 
 — The lessons the war has brought home to us — His Majesty's 
 message to his troops in France — Unification of company 
 laws within Empire — The Navy — Our first line of defence — 
 The Kaiser's ambition regarding his Fleet — Subsidies granted 
 to German Merchant Service — Regarding our navigation laws 
 
XX CONTENTS 
 
 repealed 1849 — Importance of maintaining supremacy of our 
 Mercantile Marine — Reduced railway charges on goods sent 
 by German liners — World's ports and harbours mainly in 
 Allies' territories — Respecting sinking of liners and hospital 
 ships by German submarines — The soldiers of the Empire 
 — " The United Empire loyalists " of Canada — Immigration 
 to Canada — Federation of the Dominion of Canada — Framing 
 the Canadian Constitution — The tariff question in Canada — 
 Canada gives a preferential tariff rate to British goods — The 
 Canadian boundary — The pioneers of the Canadian Pacific 
 Railway — Canada, the great granary of the Empire — The 
 progressive trade returns of Canada — Extract from a speech 
 by the late Lord Duffer in — Australia of to-day — Australian 
 thoroughness — No more peaceful penetration — The Anzacs — 
 Railways in Australia — Australia and immigration — " A White 
 Australian " — Labour Legislation — Australian sheep and wool 
 — The rabbit pest — Dairy farming in Australia — " Advance, 
 Australia " — The Britain of the Southern Seas — Land Laws 
 in New Zealand — Women's suffrage — Agricultural and pastoral 
 prosperity — The external trade of New Zealand — The prefer- 
 ential trade given to the United Kingdom — " Frightfulness " 
 will prove a bar to German commerce — The splendid gift of 
 Dreadnoughts by New Zealand — Dairy farming by small 
 holders of land — Gold mining in New Zealand — German 
 invasion of South Africa — General Botha captures South-West 
 Africa for the Empire — Framing the Union Constitution — 
 Current of trade to and from South Africa — Preference given 
 by South Africa to British and Imperial Commerce — Gold 
 mining in the Rand — Diamond mining — South African coal- 
 fields — Other products of the South African Union — Death 
 and Will of Cecil Rhodes — Population of South Africa — 
 Resvilt of British firm yet just rule in South Africa — The great 
 Empire of India — The Imperial Conference and India — The 
 important natural resources of India — The growth of cotton 
 — India's suj)ply of hides for manufacture — Enormous export 
 of Indian teas — Indian railways — Regarding growth of cereals 
 including wheat — India's path of progress — Brief survey of 
 certain Crown Colonies and their great resources — Cuba and 
 Jamaica compared — Our pre-war sugar supply almost ex- 
 clusively from Central Europe — The foreign-sugar bounty 
 system — The decay of certain British tropical colonies and its 
 cause — The Sugar Convention of 1902-3 — The agreement 
 broken by the British Government — The protection of foreign 
 
CONTENTS xxi 
 
 bounty-fed sugar restored — We should and can stop this 
 unfair foreign-bounty system — A more decisive policy desirable 
 —Let the United Kingdom wake up . . pp. 67-152 
 
 CHAPTER V 
 
 ALLIES IN PEACE AS WELL AS WAR 
 
 The Allies and their control of half the trade of the world — The 
 lead to protect their joint economic interests should be 
 made by us — Prior to the war economic independence of 
 certain of the Allies threatened — The mutual commercial 
 interest of England and France — The French National 
 Debt mainly a modern creation — The entente cordiale should 
 be made in times of peace an action cordiale — Resume 
 of resolutions carried at Paris Economic Conference of 
 1916 — Certain views of leading men as to whether these 
 resolutions will be made effective — " The most favoured 
 nation " clause in commercial treaties — We require to 
 make a fresh start and new treaties of commerce — What 
 a " key industry " is clearly defined — " There are none so 
 deaf as those who won't hear " — Monsieur Thiers on a 
 British national danger — Revenue raised in France chiefly 
 by indirect taxation — The area of land cultivated in 
 Russia— Our commercial interchange with Russia large, 
 but could bo increased — British commercial travellers should 
 adopt more up-to-date methods — Increatse of our Consular 
 Service in Russia required — The Russian imjDort tariff — 
 Importance of our coal trade to supply Russian requirements 
 — Opposition to syndicates and combines in that country 
 — Our export trade to Russia in 1913 small compared with 
 Germany's — Encouragement in Russia to the agricultural 
 interest — Large voluntary emigration to Siberia — Their Parlia- 
 ment or Duma — Openings in Russia for British Commerce — 
 The rise of German influence in Russia — Her pacific invasion 
 by colonisation in that country — Germany's aim to thrust 
 Russia into hazardous undertakings — Action during this war 
 of German emigrants in the Czar's Dominions — The Slavo- 
 philes' chief aim — The Conference at the Hague on Arbitration 
 and the rules of war — The Duma — The village commune or 
 " Mir " — The Russian Government's patient attitude despite 
 provocation — The prohibition of the use of alcoholic spirits in 
 Russia — " Russia would have had peace if she had been left 
 
xxii CONTENTS 
 
 alone" — "The Year of the Tiger" — Agriculture highly esteemed 
 by the Japanese — Large recent demands for Japanese exports 
 — Policy in Japan to " support home industries " — Japanese 
 engineering works — Trade and manufactures of Japan — Con- 
 scription adopted in 1873 by the Japanese — Present military- 
 service system in Great Britain — How Japan set about fram- 
 ing her Constitution — China surrenders Kiaochow to Germany 
 — The Kaiser's " Hun " speech — Efficiency of the Japanese 
 Military Medical Service — Treaty of Alliance between Great 
 Britain and Japan — The gallant fight made by Belgium at the 
 beginning of the war — Belgian resistance of great value to the 
 Allies — The commercial interchange of Belgium — Italian 
 shipping, trade, and commerce — Great demand for timber in 
 Italy — A large Italian agricultural population — That country 
 has a high import tariff — Italy denounces two treaties with 
 Germany — Roumania — Portugal joins the Allies — Serbia and 
 Montenegro ....... pp. 153-198 
 
 CHAPTER VI 
 
 NEUTRAL NATIONS 
 
 Niagara and the use made of its water power — Preferential tariff's 
 — American mode of taxation — The economic policy of the 
 United States— The federation of the American Union— Inter- 
 national Law and German submarine outrages — Greece and its 
 anomalous position — The natural resources of Spain — A tariff 
 gives bargaining power to a nation in making treaties of com- 
 merce — Rio Tinto copper mine — Ancient and modern mode of 
 locomotion in China — The change of China from an Empire 
 to a Republic — First attempt to introduce railways opposed — 
 Agriculture in China held in high esteem — Board to see land 
 properly cultivated — Chinese prisons and mode of punish- 
 ment — Competitive examinations in China — Foreign trade in 
 that Republic — Tenure of land — Regarding Chinese tea, silk, 
 porcelain, and bronzes — Area and climate and forests of Brazil 
 — Para rubber — Prospects respecting our commerce with 
 Brazil — Population of Brazil — Marvellous increase in trade 
 with the Argentine in under forty years — Natural features 
 and commerce of Chili— Will history repeat itself after this 
 war ends ?— Santiago— The Panama Canal — The natural re- 
 sources of Colombia — Mexico • . . pp. 199-238 
 
CONTENTS xxiii 
 
 CHAPTER VII 
 
 THE CENTRAL EUROPEAN POWERS 
 
 After the war will Germany resume her economic pre-war policy ? 
 — Arguments set forth by Bismarck on introducing German 
 tariff in 1879 — Liszt's views on Free Trade and Protection — 
 German organisation to encourage their industries — Their 
 " Linked Company System " and its thoroughness — Our pre- 
 war dependence on German manufactures — "Prohibition" 
 not a permanent remedy for foreign economic " peaceful 
 penetration" — Invention not a German forte except in 
 chemistry — Effective German mode of technical education — 
 The proposed economic Zollverein of the Central European 
 Powers — German State socialistic financial aid for their in- 
 dustries — Their outside trade diiring war small, therefore fall 
 in exchange not of great present importance — Resolutions by 
 British Imperial Chamber of Commerce — " Free Traders" say 
 defeat at Manchester of their dogmas caused by " anti - 
 German " feeling — Wages of German workmen and their food 
 — Nearly half Germany's pre-war trade to the Allies — By 
 organisation we shall increase the economic power of our in- 
 dustries — The Board of Trade advises British merchants to 
 study more local conditions and needs of their customers — 
 We cannot consider trade apart from its relation to national 
 security — Respecting our commercial interchange with 
 Austria — British trade with Turkey — Pre-war magnitude of 
 our manufactured imports from Germany — German import 
 tariffs — Our industries require equal competition — A prac- 
 tical not a sentimental view of the economic system re- 
 quisite — Lord Macaulay's speech on the sugar duties 
 
 pp. 239-262 
 
 CHAPTER VIII 
 
 THE HOUR OF GREAT OPPORTUNITY 
 
 A united Empire— Inter-Imperial problems— A British general 
 tariff — " Do it now " — German preparations for a trade war 
 — The danger to our industries — The Allies and Dominions less 
 vulnerable — Canada repels German tariff attack — Britain lacks 
 power of similar reprisals — A committee sometimes appointed 
 to gain time — Our helplessness under " Free Trade " system 
 
xxiv CONTENTS 
 
 provokes attack — The "most favoured nation" clause in 
 treaties valueless — Futile to only tax goods we cannot produce 
 — The manufacture of goods in large quantities conduces to 
 cheapness in production — Free Traders' mode of propaganda 
 — Fiscal independence in the Empire can be combined with 
 general unity of action — Converts to Tariff Reform — Labour 
 view in regard to dumping — A cause of unemployment to our 
 workers — Sir George Foster on Trade and Commerce — Public 
 opinion now opposed to the laissez /aire doctrine — Greater 
 j)re-war increase of German trade than British — Regarding 
 British industries, not sympathy, but action requisite — We 
 must not lose the industrial ground recently recaptured — 
 When Adam Smith advocated retaliation — Industrial defence 
 imperative — National security and continuous employment of 
 paramount importance — After-war trade competition — Com- 
 bined organisation needful — Our supply of munitions organised 
 by Mr. Lloyd George — The resources of the Empire — Others 
 should not monopolise our national wealth — Reciprocal prefer- 
 ential trade with the British Dominions and also with the 
 Allies — The development of Russia — Indemnities for losses by 
 the great war — The position of neutral powers — Can we place 
 Germany on the same economic basis as before the war ? — 
 The origin of this world-wide contest — During reconstruction 
 period restriction of imports from Germany — Imperial Con- 
 stitutional Union no new problem — Lord Beaconsfield's views 
 on this great question — Suggested initial steps to knit together 
 Greater Britain — Some aspects of the Imperial constitutional 
 question considered — Imperial Federation — An Imperial Coun- 
 cil or Conference — Suggested initial steps towards federation 
 — Our system respecting foreign affairs — Not good policy to 
 make foreign affairs a party question — The British Merchant 
 Service — Regarding shipping during reconstruction period — 
 Now is the hour for definite action to consolidate both our 
 and the Allies' resources — The falsity of the free-import trader's 
 prophecies — All goods sold in this country, foreign as well as 
 home-made, should equally share in paying taxation — The 
 incidence of the income tax — A treble income tax charged to 
 some British subjects — A graduated income tax illegal in the 
 LTnited States — Indirect taxation less felt than direct — New 
 facts and conditions demand fresh consideration — The retalia- 
 tion bogy — The Empire strengthened by an ordeal of fire — 
 — A Minister of Industry and Commerce — Work and wages 
 — Our duty to preserve our natural resources — Our law re- 
 
CONTENTS XXV 
 
 garding status of aliens — Action by France and Russia respect- 
 ing naturalised Germans — The assimilation of commercial law 
 throughout the Empire — Bills of Exchange Act, 1882 — Equal 
 charges of postage for letters sent to all places in the Postal 
 Union — Regarding foreign patents worked in this country — 
 Security required to encourage industrial enterprise — Limita- 
 tion of output by workers a bad system — German shipbuilding 
 for after-war competition — Lord Balfour of Burleigh's Com- 
 mittee report in favour of Imperial Preference — Useful and 
 patriotic action by all parties in the State during the war — 
 The National Service Scheme — Lord Derby on the Paris 
 Economic Conference and the resolutions then carried — The 
 great danger we have to face — An awakened Empire 
 
 pp. 263-318 
 
APPENDICES 
 
 PAGE 
 
 I. Imperial Representation . . .319 
 
 II. Land Settlement . . . .321 
 
 III. The United States sever Diplomatic 
 
 Relations with Germany . . . 323 
 
 IV, Report regarding Imperial Preferences 
 
 AND Cor.lMERCIAL TREATIES . , ,321 
 
 XXVI 
 
THE AWAKENING OF AN 
 EMPIRE 
 
 CHAPTER I 
 
 BY WAY OF INTRODUCTION 
 
 " To be, or not to be, that is the question : — 
 Whether 'tis nobler in the mind to suffer 
 The stings and arrows of outrageous fortune ; 
 Or to take arms against a sea of troubles, 
 And by opposing end them ? " 
 
 Shake SPEABE. 
 
 During the occupation of Bloemfontein by Lord 
 Roberts a memorable little function took place in the 
 refreshment room of the railway station there. Several 
 of the war correspondents combined to give a dinner 
 to the Commander-m-Chief and Sir Alfred Milner and 
 Mr. Rudyard Kipling. Among the toasts was one 
 proposed by Mr. Kipling. He asked the company to 
 drink to the health of " the man who has united the 
 British Empire— Stephanus Johannes Paulus Kruger." 
 What Mr. Kipling had in mind in proposing that 
 novel toast was the splendid manner in which the 
 Dominions had rallied to the side of the Mother 
 Country in sending their sons to share in the South 
 African war. It was the fu'st time such evidence of 
 Imperial solidarity had been given, hence it was par- 
 donable for the poet of the Empire to draw the con- 
 
 1 
 
2 BY WAY OF INTRODUCTION 
 
 elusion that Imperial unity had been establii^hed upon 
 a sure foundation. But what happened ? When the 
 South African war ended, and Mr. Joseph Chamberlain 
 made a valiant effort to reap what should have been 
 the inevitable harvest, his labours were thwarted by 
 a persistent revival of Little-Englandism. It must 
 not be forgotten that the obstacles to a real Imperial 
 unity were created not by the Dominions, but by the 
 party politicians of Great Britain. In various ways 
 the Dominions approached the Mother Country, 
 desiring above all things that the union of the battle- 
 fields should be repeated in political and economic 
 relationships ; but all those approaches were spurned 
 because, forsooth, they might have thwarted party 
 triumphs at home. 
 
 As during the South African war, so now in the 
 midst of the world's greatest war, the term " British 
 Empire " is used in a loose manner. One is almost 
 tempted to apply Voltaire's scathing comment on the 
 Holy Roman Empire, which, he said, was neither holy 
 nor Roman nor an empire. In the strict meaning 
 of the word the British Empire is not an empire. 
 Properly, as the dictionary reminds us, " an empire 
 is an aggregate of conquered, colonised, or confederated 
 States, each with its own government, subordinate or 
 tributary to that of the empire as a whole." In the 
 sense in which the Russian Empire is an empire the 
 British Empire is not an empire. The distinction has 
 been clearly defined in the introduction to The Com- 
 monwealth of Nations as follows : 
 
 " Viewed from without, the British Empire is a 
 single State with a single Government, in practice just 
 
IMPERIAL COHESION 3 
 
 as competent to commit all its subjects to peace or 
 war as the Governments of Russia, Germany, or the 
 United States. But it cannot, like them, command 
 the resources of all its subjects and territories in the 
 discharge of its responsibilities. As the people of 
 the Dominions have no voice in the government of the 
 Empire, so are they not subject to contribute to its 
 necessities. Viewed from within, the Empire lacks 
 that property of States by which they proportion the 
 expenditure of their resources to the responsibilities 
 which the possession of those resources involves. It is 
 a commonwealth which excludes from a share in its 
 government an increasing proportion of citizens in 
 no way less qualified for the task than those whom it 
 admits to it. It is a State, yet not a State ; a Common- 
 wealth, yet one which fails to realise an essential con- 
 dition of the principle which inspires it." 
 
 What happened during the South African war has 
 been repeated on a far greater scale in the present 
 titanic conflict. It is the story of ancient Greece 
 repeated again. As in the days of Hellas, a grave 
 danger to the British commonwealth has led to the 
 close co-operation of all the members of that common- 
 wealth. For the period of the war, at least, w^e have 
 learnt, as the Greeks learnt, that " though love of 
 country may make men brave, it is only organisation 
 that can make them strong." It is generally agreed 
 that no war has ever brought us so closely together 
 as the present conflict, and that the people of 
 the Mother Country have never been so entirely at 
 one in their determination to fight a war to a vic- 
 torious issue. This cohesion is even more strikingly 
 illustrated in the case of the Dommions and other 
 parts of the Empire. The toast which Mr. Kipling 
 
4 BY WAY OF INTRODUCTION 
 
 proposed in connection with President Kruger, " the 
 man who has united the British Empire," can be much 
 more emphatically applied to the Kaiser. Whereas 
 that deluded monarch expected our commonwealth 
 to scatter asunder at the touch of his sword, the direct 
 opposite has happened. 
 
 What, however, is to be the result of all this when 
 we return to peace ? Are we to witness a repetition 
 of the tragedy which followed the South African w^ar ? 
 When the danger has passed, shall we slide back into 
 the old haphazard ways, leaving the political and 
 economic relations of the Empire in the chaotic con- 
 dition of pre-war days ? Half a century ago Lord 
 Beaconsfield foresaw the day when Canada might be 
 lost as a " dependency " but would become a " per- 
 manent ally and friend." That condition has been 
 realised in connection with all the Dominions ; they 
 have, indeed, become Allies and friends. But will 
 they continue so ? Everything depends upon the 
 political and economic relations of the future. The 
 only safe path is that pointed out by the motto of the 
 British Imperial Council of Commerce — " Unity in 
 Commerce and Defence." Now defence is more im- 
 portant to the British Empire than any other con- 
 sideration. Even Adam Smith admitted that defence 
 is of greater moment than opulence. What, then, 
 every homeland Briton must realise is that "national 
 safety is more important than economic laws." 
 
 This is a hard lesson for time-serving politicians 
 and self-centred manufacturers to learn. That fact 
 has been illustrated again and again by the so-called 
 " party truce." Any attempts of leading men openly 
 and publicly to advocate a new point of view in 
 
OUR FISCAL POLICY 5 
 
 economics were greeted with protests that such 
 attempts were a breach of the " party truce." Cob- 
 denites grow quite unctuous in appeals to pubHc 
 men to "drop politics," and eschew^ "isms," but when 
 we put the matter to the test we find that what they 
 mean is that while everyone else should desist from 
 stating their opinions. Free Traders are to be allowed 
 to preach their dogmas, and also to cling to their par- 
 ticular cult with the tenacity of the limpet. Indeed, 
 these obscurantists would have us believe that the 
 " party truce " is a most admirable institution so long 
 as it benefits their opinions. Notwithstanding the 
 tremendous issues involved in the war, what these 
 advocates of the " party truce " are most concerned 
 with is to save from the post-war wreckage as much as 
 possible of their old political stock-in-trade. They are 
 more interested in winning the next general election 
 than in the defeat of Germany. It is too often for- 
 gotten, indeed, what a vital relation exists between 
 the commerce and defence of an empire. IVIr. Hughes, 
 the Prime Minister of Australia, put the matter in a 
 nutshell when he said : 
 
 "If it were a question of trade, only affecting our 
 pockets, the fiscal question might fairly be left to 
 settle itself, but it reaches down into the very roots 
 of our lives. You cannot proceed on the assumption 
 that the economic policy of a nation has no relation 
 to its national welfare." 
 
 All these considerations lead inevitably to the im- 
 portant questions discussed in the ensuing chapters. 
 They resolve themselves on the economic side into the 
 one question of a fiscal policy, and, such being the 
 
6 BY WAY OF INTRODUCTION 
 
 case, it would be idle to ignore the fact that the advo- 
 cates of reform have to attack and demolish the hoary 
 entrenchments of the Free Trade, laissez-faire armies. 
 At the outset it is essential to insist upon the fact 
 that this question of fiscal policy must be examined 
 in the light of the unprecedented situation which has 
 now arisen. To revert to old economic conditions 
 after the war would be futile. Germany's conduct both 
 before and during hostilities has made that impossible. 
 Old methods of every kind have been tried and found 
 wanting. Are our sailors keeping ward of the seas 
 in those " wooden walls of old England " behind which 
 Nelson and his seamen fought ? Have we equipped 
 our gallant soldiers in France with the bows and 
 arrows and crossbows of mediaeval England ? On the 
 contrary, our seamen sail the seas in the most up-to- 
 date dreadnoughts equipped with the latest pattern 
 guns, while our soldiers are armed with the best 
 weapons of modern days ; and in just the same way it 
 is essential that in the trade war of the future we shall 
 avail ourselves, not of the obsolete devices of a dis- 
 credited school, but of the newest and most efficient 
 weapons of economic warfare. 
 
 What too many either do not or do not wish to 
 realise is that Free Trade is a myth. There is no 
 such thing save in theory. We have had the name 
 for many years, but never the actuality. This differ- 
 ence between the shadow and the substance has been 
 artfully concealed by its devotees. They have been 
 careful to hide the fact that what we really have in 
 Great Britain is Free Imports, not Free Trade. They 
 have been equally adroit in obscuring the further fact 
 that Cobden's prophecy, namely, that our adoption of 
 
''THE MANCHESTER SCHOOL'' 7 
 
 Free Imports would lead to the opening of all the 
 markets of the world, has not been realised. In other 
 words, while we continue blindly to allow the produc- 
 tions of Germany and other nations free entrance into 
 our ports to compete with the productions of our own 
 workers, Germany and other Protectionist countries 
 persist in laying duties upon British productions. 
 Free Trade as visualised in the middle of last century 
 is an unrealised ideal. " If," Cobden declared in 1846, 
 " you adopt free trade in its simplicity, there will not 
 be a tariff in Europe that will not be changed in less 
 than five years ! " He it was, too, who deplored our 
 colonial system, and rejoiced over everything which 
 tended to lessen the connection between the Mother 
 Country and the Dominions. Nor should it be for- 
 gotten that the Manchester school mistook the welfare 
 of a section of the merchants and manufacturers for 
 that of the nation, and were more concerned for the 
 employer of labour than for the workers. One proof 
 of this will suffice. When in 1846 legislation was 
 initiated to reduce the hours of labour in factories, the 
 stoutest opposition came from Cobden and Bright and 
 their colleagues of the Manchester school. 
 
 These are some of the reasons why it is more than 
 time Great Britain cast the Free Trade fetish to the 
 rubbish heap. By so doing we shall gain what is 
 vitally important to the welfare of the Empire, namely, 
 the resumption of our power to bargain. Freedom of 
 movement is essential for the general who is to achieve 
 victory on the battlefield. It means that the offen- 
 sive is in his hands, and that he can impose his plan 
 of campaign on the enemy. The power to bargain 
 is the equivalent weapon of the economic world. We 
 3 
 
8 BY WAY OF LXTRODUCTION 
 
 have no such power so long as our ports are open to 
 all and sundry. We are helpless to deal with any 
 situation which may arise through the wholesale 
 dumping upon our shores of any and every kind of 
 manufacture. To resume the power of bargaining, 
 too, will enable us to cement that union with the 
 Dominions w^hich has been exemplified in common 
 danger and heroic sacrifice on so many battlefields. 
 
CHAPTER II 
 
 ** WATCHMAN, WHAT OF THE NIGHT? " 
 
 " It was a wise king who said that if he wished to punish a province 
 he would deliver it up to the rule of political philosophera." 
 
 An economic system must be able to bear the strain of 
 war, of national emergency, or the stress of adversity. 
 If it is only suitable for fair-weather prosperity, it is 
 not one upon which a great country like ours should 
 rely. One must, of course, remember that the British 
 mind is very reluctant to change, and generally slow 
 to alter any system which it has accustomed itself to 
 for some years, however essential and important an 
 alteration of that system may be ; yet it must be clear 
 to all but those who refuse to open their eyes that we 
 cannot, after the exclusion of our goods from foreign 
 markets, allow foreign bounty-fed goods to be dumped 
 on our shores with our hands tied behind our backs, 
 and the power of fiscal reprisal taken away from us. 
 
 The fiscal policy by which we were decoyed seventy 
 years ago lies a heap of ruins — a monument of broken 
 promises and failure. Yet, although that is the case, 
 we have had no definite ministerial statement of what 
 is required to improve our present system permanently, 
 nor whether the old one is definitely abandoned or not. 
 What steps, in fact, are we about to take to replace 
 
 9 
 
10 ''WATCHMAN, WHAT OF THE NIGHT T* 
 
 obsolete methods by a different commercial and in- 
 dustrial policy altogether ? No doubt the party truce 
 and other causes have blocked the v/ay ; but let us 
 hope that the day is not far distant when a patriotic 
 Government will decide not only to look into but to 
 carry measures to safeguard the interests of our country 
 and of the Empire in this vitally important matter. 
 
 One of the evils to which our industry has been 
 subjected to its detriment has very often been caused 
 by the " dumping " process so often referred to as 
 an insidious system by v»^hich the foreigner thrusts his 
 surplus goods on British markets, often under cost 
 price, with the ultimate object of injuring or destroy- 
 ing our manufacture of those products. The following 
 will serve as one example of the way in which it 
 is done : A foreign manufacturer has enough orders 
 to keep going two hundred looms out of, say, three 
 hundred in his works. He does not, as the English 
 manufacturer has to do, keep the other hundred idle. 
 He commences producing goods with them for which 
 he is practically assured of a market in Great Britain 
 under our Free Imports system. The hundred looms 
 have borne one-third of the working costs of the mill, 
 and the manufacturer, by selling the cloth that has 
 been made on them, has succeeded in driving out some 
 trade from the British manufacturers in our home 
 market. To that extent he has injured possible com- 
 petitors in British and neutral markets, and moreover 
 made a substantial profit on his sales in his own 
 country, as the goods he sold in England paid their 
 proportion of the establishment and management 
 charges and charges for rent. Of course it is impossible 
 to stop this, nor could we retaliate and charge import 
 
EVILS OF DUMPING 11 
 
 duty on these goods unless we had a general tariff, 
 as we have recklessly abandoned our power in that 
 respect, and are therefore at a disadvantage either in 
 bargaining with regard to commercial treaties or re- 
 taliating when our industries are attacked. 
 
 There are still some people amongst us who try to 
 prove that dumping has its good side for the remarkable 
 " rob Peter to pay Paul " reason ; and whilst they are 
 fully aware that dumping under cost price or at a 
 minimum profit is not done for philanthropy, but ^^ ith 
 the ultimate object of superseding and destroymg one 
 of our industries, they attempt to claim that it benefits 
 another manufacturing industry if the foreigner sells 
 under that system certain by-products under cost price. 
 This is indeed a short-sighted policy, equal to that of 
 killing the goose that lays the golden eggs, for pre- 
 suming that some of our manufacturers — those, for 
 instance, who make tin plates — obtain from abroad for 
 a short time some of their by-products under cost 
 price, the sale of those by-products is, of course, in 
 consequence stopped in the United Kingdom, and pro- 
 bably that manufacture ceases here. The foreign 
 shipper immediately puts the price up to the tin-plate 
 manufacturer ; he probably also reduces the price at 
 which he sells it in his own country, and the result of 
 this is that he not only first destroys the manufacture 
 of the by-product, but successfully competes with and 
 probably injures very much the prosperity of the 
 manufacturer of tin plates in his own industry. Re- 
 garding this short-sighted policy it is interesting to 
 notice what Bastiat, the French economist, says, 
 speaking of the difference between a bad and good 
 economist : 
 
12 '' WATCHMAN, WHAT OF THE NIGHT?" 
 
 "The one takes account of the visible effects, the 
 other takes account both of the effects which are seen 
 and also of those which it is necessary to foresee. Now 
 this difference is enormous, for it almost always happens 
 that when the immediate consequence is favourable 
 the ultimate consequences are fatal, and the converse. 
 Hence it follows that the bad economist pursues a 
 small present good, which will be followed by a great 
 evil to come, whilst the true economist pursues a great 
 good to come, at the risk of a small present evil." 
 
 This war, or the economic preparation for this war, 
 has in reality been going on for twenty years between 
 this country and Germany. Hostilities really only 
 reached their head when the armies met in the field. 
 Withhi the last ten years the economic attack of 
 Germany has been speeded up, and any pretence of 
 " give and take " and friendly dealing thrown aside. 
 That country resolved to get together the sinews of 
 war, and resolutely set to work, with no inconsiderable 
 success, to oust England not only from her markets in 
 her Colonies and amongst neutral nations, but in the 
 United Kingdom itself. Our business will be to re- 
 cover the ground we have lost partly through our own 
 apathy and partly through our ill-devised economic 
 system, by which we recklessly threw open our own 
 markets to the whole world in a spirit of trustfulness, 
 with the expectation, not realised, that our good 
 example would be reciprocated. In fact, we were 
 persuaded by certain false prophets to be the victims 
 of a sort of international " confidence trick." Our 
 infinite belief in the good nature and generosity of 
 mankind has not been realised ; on the contrary, every 
 step has been taken by fair means or foul to undermine 
 
FREEDOM OF TRADE 13 
 
 our industry, trade, and commerce, though fortunately, 
 in many instances, without marked success. Whilst 
 we claim that we should look at all questions regarding 
 our trade, not as they appeared to people, however 
 intellectual, at the end of the eighteenth century, but 
 as they are in the year of grace 1917, it is interesting 
 to note what Adam Smith, the founder of the system 
 which, later on, Cobden and others more or less adopted 
 in the middle of the nineteenth century, says of certain 
 economic problems. " Freedom of trade," one may 
 point out, was what he advocated, — "Free Trade " was 
 a catch electioneering expression invented by certain 
 agitators in 1846 ; nor would Adam Smith have 
 adopted our present one-sided Free Import trade 
 system. These are his words : 
 
 " The case in which it may sometimes be a matter 
 of deliberation how far it is proper to continue the 
 importation of certain foreign goods, is when some 
 foreign nation restrains by high duties or prohibitions 
 the importation of some of our manufactures into their 
 country. Revenge, in this case, naturally dictates 
 retaliation, and that we should therefore impose the 
 like duties and prohibitions upon the importation of 
 some or all of their manufactures into ours." 
 
 And again he adds •: 
 
 *' There maj^ be good policy in retaliations of this 
 kind where there is a probability they will procure the 
 repeal of the high duties or prohibitions complained of." 
 
 Whatever certain doctrinaire disciples of the present 
 system may saj^ they cannot deny the fact that the 
 direct advantage of foreign or intercolonial commerce 
 does not depend upon imports solely, but on both the 
 
14 "WATCHMAN, WHAT OF THE NIGHT?" 
 
 imports and exports of a country. It is equally a 
 direct advantage to sell as well as to buy, for a nation 
 in disposing of its surplus produce derives direct 
 advantage from receiving commodities of an equal — 
 and in many cases a greater — value in lieu of those 
 exported, and after all, is not the mutual exchange of 
 commodities produced by the different nations of the 
 world the direct advantage of commerce ? 
 
 Another thing that some of our political economists 
 seem to have lost sight of in considering solely the 
 importation of foreign goods as the principal aim of 
 trade is that the trade between the town and the 
 country of a State is by far the most important, much 
 more so than the export trade. Whether or not the 
 decrease of the population in Ireland since '46, that 
 country being a great agricultural one, was caused 
 by oar Free Trade system or not we will not here 
 discuss, but it is a fact to be remembered that there 
 are in Ireland now nearly four millions fewer people 
 than there were then. A large part of that population 
 emigrated to the United States, and, of course, only 
 add slightly in consequence to the internal trade or 
 prosperity of the United Kingdom. As has been pre- 
 viously said, we must look at this question as it 
 affects the world to-day. The teaching of political 
 economists for the last twenty or thirty years has 
 been completely out of date, and is now as obsolete 
 as if our medical and surgical schools were to train 
 their students in the light of the scientific knowledge 
 which obtained in the reign of good Queen Elizabeth. 
 
 One of the largest markets of the world for manu- 
 factured products is South America. Until the be- 
 ginning of this century our position there was a very 
 
GERIMAN COMPETITION IN TRADE 15 
 
 strong one, and to the Argentine and other South 
 American States our trade is still considerable. We 
 have, however, to meet very strenuous competitors in 
 the field, and Germany, amongst others, has to a large 
 extent devoted her attention, in the most diligent way, 
 to South America, both on the east and the west 
 coasts, and, aided by a very up-to-date and efficient 
 consular service, has achieved considerable success. 
 By subsidising customers and by facilitating trade in 
 every way, including what we consider, and probably 
 rightly consider, dangerously long credits, she has 
 obtained large control of the trade in places where 
 we had once a considerable market, and, in some 
 instances, almost a freehold. Unless we make some 
 change in our system we shall not recover the ground 
 we have lost there. A remarkable instance was also 
 mentioned in a debate by JVIr. Fell in the House of 
 Commons, who stated that at Rangoon in the British 
 Colony of Burma there were a number of rice firms 
 which were German. One of the partners in one of 
 these firms told him that he made £5,000 a year at 
 this business with the greatest ease, and added, " Why 
 you English allow us to come in this way and steal 
 your business and become prosperous in what one 
 would have thought would be an English preserve 
 pa.sses my comprehension." 
 
 All industries and trades have fluctuations, and, 
 obviously, there are many reasons which cause works 
 to be removed from one district to another. Still, the 
 following instances of failing manufacturing trade 
 from the Newcastle and also from the London districts 
 are barely satisfactory. In 1911 Sir Benjamin Brown 
 wrote : 
 
16 ''WATCHMAN, WHAT OF THE NIGHT?" 
 
 " When I came to Newcastle as an employer forty- 
 two years ago, I had occasion to meet all the engineer- 
 ing employers in Newcastle and Gateshead about 
 matters which concerned us all. I have kept an 
 account of all the businesses which are represented, 
 and I find two-thirds of them have perished dis- 
 astrously." 
 
 The London instance is as follows : A few years 
 ago, about 1912, the Thames Ironworks, the last sur- 
 vivor of the great engineering firms which were so 
 numerous in the once prosperous shipbuilding centre 
 of the Thames, was closed, throwing enormous numbers 
 of men out of employment. This was caused, in our 
 opinion, not by foreign competition, but by constant 
 strikes, and by the very high rate of wages which the 
 men demanded in the London area in comparison 
 with the rates charged elsewhere. These conditions, 
 together with the higher cost of iron and coal in the 
 London area, made it impossible for the employers to 
 quote prices which would enable them to compete 
 successfully and get contracts. This came to the 
 writer's knowledge when, as a member of Parliament 
 for a division of London some years ago, he went with 
 a deputation to the then First Lord of the Admiralty 
 to ask that in the granting of certain Government 
 contracts for shipbuilding or repairs of ships by the 
 Admiralty the claims of the London shipyards should 
 not be overlooked. 
 
 Our efforts to safeguard our commercial and in- 
 dustrial undertakings by recent legislation have proved 
 very ineftectual. Company Law, Patent Law, Trade 
 Mark Law have been eluded with the greatest ease 
 by our competitors abroad, especially in Germany. 
 
EVASION OF COMMERCIAL ACTS 17 
 
 Can it be believed that a limited liability company, 
 formed entirely with foreign capital and controlled by 
 foreign directors, employing not a single British sub- 
 ject for its office or works, and selling foreign goods, 
 can be registered in England as a British company ? 
 The time has surel}^ come when the countrj^ should 
 adopt the practice of insisting upon the constitution 
 of every trade firm being made public propertj'. The 
 names of the partners in private firms should be on 
 their notepaper, and public companies should give 
 much fuller information as to their real ownership 
 than they do at present. The Patent Law recently 
 passed enjoins that all patents should be manufactured 
 *' to an adequate extent " in the United Kingdom, 
 but it is evaded and set at naught by foreign firms with 
 impunity in the following way : By establishing some 
 small or insignificant factory in the United Kingdom 
 which produces not a tenth of the sales of their patent 
 article in this country, or by their making abroad all 
 their goods imported here, and simply giving them 
 some slight " finishing process " on their arrival in 
 England in order that they may pretend to comply 
 with this Act, whilst in reality they ignored its pro- 
 visions. The latter, it should be remembered, were 
 framed with the intention of making the foreign 
 manufacturing firms pay their fair share of the coun- 
 try's burdens by establishing hona-fide works in this 
 country to produce the patented product protected 
 by our laws, and with the all-important object of 
 giving employment to British labour. 
 
 The evasion of the Trade Marks Law is usually 
 accomplished without much difficulty by the following 
 artifice on the part of our foreign competitors : As 
 
18 *' WATCHMAN, WHAT OF THE NIGHT?" 
 
 this law enacts that an article bearing no word of 
 English need not have any indication of origin, wher- 
 ever possible the foreign goods are sent here without 
 having anything printed on them. In some instances, 
 as in the case of jewellery, the goods are of too small 
 a description to have the words " Made in Germany " 
 stamped on them, so it is simply put on the wrapper, 
 which is duly thrown aside, and many goods, it is said, 
 sold in this country and stamped with the names of 
 British firms are in reality made in Germany, not 
 improbably by forced prison labour or by the work 
 of employees working under the sweating system of 
 hours and pay. 
 
 The only practical remedy would be for all goods 
 made in Great Britain to have a compulsory stamp 
 on them to that effect, this trade mark to be applicable 
 only to goods made wholly in this country, and for 
 the purchaser wishing to buy British goods to see 
 that he gets them, and to make the sale of goods by 
 a trader who certifies that they are all British, but are 
 in reality not so, liable to prosecution under the 
 Statute of Frauds. 
 
 It has been advocated by some that there should be 
 National Banks started with headquarters in London, 
 and branches elsewhere, and trade centres to assist 
 industrial enterprise, these to be to some extent under 
 the patronage of the State. Such an institution, if 
 required, should, however, be self-supporting, and 
 further, it would be contrary to public policy for a 
 State-aided bank to enter into the field of competition 
 with the existing banks. It would be, in fact, a loan 
 agency on a large scale, and it is not within the pro- 
 vince of the State to be its sponsor. If, however, it 
 
BRITISH AND FOREIGN BANKING 19 
 
 were started by private enterprise, it would probably 
 meet a want, unless the existing banks thought fit to 
 enter this field of commerce, when its utility would 
 be less apparent. The Prussian Central European 
 system of banking is, that though they have a com- 
 paratively small portion of liabilities to the public as 
 compared with the English Joint Stock Banks, they 
 are often in times of industrial crisis very much em- 
 barrassed. There have been in tho last fifteen or 
 twenty years no crises in England in this respect, 
 whereas in Germany there have been several very 
 severe ones. It must be borne in mind that the Ger- 
 man banker shares in the profits of the industry he 
 supports and also in some cases in the losses. These 
 banks are, therefore, part and parcel of the industries 
 of Germany. The London banker, as a rule, is essen- 
 tially an internationalist. In an indirect way, by 
 means of the discount of bills endorsed by the Deutsche 
 Bank and other well-known German banking firms, 
 the British Joint Stock Banks, prior to the war, lent 
 money to build up and support dozens of German 
 industries, some of which, probably, soon became 
 prosperous, and outstripped their British rivals, who 
 were unable to obtain similar banking facilities. 
 Baing the international bankers of the world, our 
 bankers have to keep their assets in a liquid condition, 
 and cannot, therefore, finance the industries of the 
 country in the same way as the private banks did. 
 
 It has been estimated by the economist that the 
 commission business, which is the result of our inter- 
 national position in the money market, is worth some 
 £30,000,000 to £40,000,000 a year. In the interests 
 of that international business the amalgamation of 
 
20 "WATCHMAJS^ WHAT OF THE NIGHT T' 
 
 banks has taken place in this country, and we have 
 now simply a few groups of large banks, and, as has 
 been previously said, it appears well worthy of con- 
 sideration whether these banks, without throwing 
 aside their great international system of banking, 
 might not devote a part of their capital to starting 
 commercial and industrial banks in different parts of 
 the country. 
 
 Whilst on the subject of banking it might be well 
 to notice the question of the onus of the enormous 
 national debt we are incurring. Making all allowances 
 for the immense sums we are now spending, it has 
 been estimated that our national debt is not likely to 
 exceed one year's national income. A hundred years 
 ago our forefathers had a national debt which was 
 equal to three years' national income. It would be 
 wise, however, to spare no effort when the war ends to 
 economise, as far as practicable, on our imports, and 
 no doubt efforts will be made in that direction, more 
 especially in regard to luxuries. The great problem 
 we shall have to face when the war terminates is 
 whether the Allies, or those to whom they are now 
 opposed, will recuperate most quickly, and be able to 
 take either the offensive or defensive in the commercial 
 struggle which wdll then ensue. Presuming tlie war 
 ends within three years, we must be prepared to face 
 an annual expenditure in the United Kingdom of 
 £300,000,000, and, should it last longer than that, 
 even a larger sum. Half the sum named would be 
 required to meet the annual charges on the debt. In 
 this calculation, however, no allowance has been made 
 for a sinking fund or pensions. 
 
 One must remember that success in trade does not 
 
ARE OUR METHODS OUT OF DATE? 21 
 
 come to those who refuse to profit by the experience 
 of their neighbours. Great Britain has shown no lack 
 of enterprise in the past, and she outstripped in the 
 commercial and industrial competition of nations all 
 her rivals up to the middle of last century, since when 
 others have rapidly come up to her, and in some 
 kinds of business, such as the iron and steel industries, 
 have outstripped her. We must examine the cause 
 of this, and see if we are suffering as a result of 
 slavishly following the fetish of Free Import trade ; or 
 owing to a lack of cohesion between capital and labour, 
 or between finance and industry in this country ; or 
 in consequence of not giving the same attention to 
 organisation, technical science, and education as some 
 of our rivals, or for any other reason. If we find that 
 our unworkable system has been the cause of our 
 rivals' success, we must boldly and bravely — as did 
 the Japanese in the seventies of the last century — cast 
 aside antiquated methods and deep-rooted prejudices 
 which we see are out of date, and adopt what we find 
 good in other nations and other peoples, even those 
 who are now our enemies. It must be borne in mind 
 by all that we cannot exist as a great Power solely as 
 suppliers of cotton goods, traders, agents, and bankers. 
 This country must not only be a great, but a general 
 producing country, both in agriculture and manu- 
 facture. We have to purchase, whether we like it 
 or not, more than half the food we require from 
 abroad. 
 
 The Americans, who produce more food than they 
 require for their own consumption, if blockaded would 
 have a superabundance of food within their borders, 
 as they would lose their export markets, and, in 
 
22 -WATCHMAN, WHAT OF THE NIGHT?" 
 
 consequence, would retain in their own country the 
 food they usually sent abroad. Were we blockaded 
 in reality, and not merely on paper as at present, as 
 soon as the accumulated stores we possessed were 
 exhausted half the i^eople would starve. What we 
 require is a national business policy based on practical 
 business lines framed for the benefit of the whole com- 
 munity — tlie workers engaged in all industries as well 
 as the fixed annuitants. There is the more necessity 
 for a thorough and practical business policy inas- 
 much as when this war ends, the German exchange 
 will have fallen, and in order to raise and steady it 
 her merchants will set about extending and selling 
 the large quantities of manufactured goods which 
 they have accumulated in many directions during the 
 time their export trade has been almost completely 
 stopped by our blockade. This will flood the world 
 with low-priced goods, and throttle the recuperation 
 of the commercial and industrial activity of the Allies 
 in their home and neutral markets, causing, unless 
 drastic steps are taken beforehand, great suffering to 
 the industrial classes amongst the Entente Powers. 
 
 It has been a matter of general astonishment that, 
 although we are a commercial nation, the professors at 
 our Universities should teach economic science largely 
 as an abstract question, basing their teaching almost 
 entirely on theory, as if they were educating the 
 student not for this planet, but for another, in a more 
 Utopian world. The historical economic lore of the 
 eighteenth- century professors is drummed into the 
 students' ears, together with what those authorities 
 thought the trend of the somewhat primitive condi- 
 tion of trade and industrv would take. This was the 
 
UNIVERSITY TEACHING OF ECONOMICS 23 
 
 case when the present writer was up at Cambridge 
 many years ago ; apparently there is little, if any, 
 change in that respect at most of our Universities 
 to-day. The curriculum was very narrow and very 
 restricted, and consisted in hearing lectures based on 
 works which we had to study, dealing with the views 
 of political economists of the eighteenth or early 
 nineteenth century. Several of the undergraduates 
 of that day chanced to be the sons of large manu- 
 facturers in the north of England, young men who, 
 when at home during the vacation, heard their seniors 
 talk of the condition of British industry and trade, 
 and their opinion of the " dreary science " was very 
 much the same as the one here set forth, that it was 
 thoroughly unpractical and not up-to-date. How- 
 ever, when the examination took place, they probably, 
 like himself, kept their own private views to them- 
 selves, and answered the questions in accordance with 
 the doctrines set forth in the textbooks and expounded 
 by the lecturers. But most of them do not appear to 
 have been so successful as the present writer, who 
 obtained a first-class in that science. This old-world 
 system is rather like the way the Chinese appear to have 
 trained their young military officers in the year 1880. 
 Amongst other tests these candidates who were being 
 examined for commissions had to undergo was that 
 of proficiency in the use of the bow and arrow ! On 
 one occasion, whilst at Canton, the author was present 
 at an inspection of a division of the Chinese army. The 
 men were fine, well-set up fellows, they did their old- 
 fashioned drill well, and their uniforms and accoutre- 
 ments were serviceable. Every company seemed to 
 have half a dozen flags or pennons, and the words of 
 4 
 
24 ''WATCHMAN, WHAT OF THE NIGHT?'* 
 
 command were given by flag signalling. Their arms 
 were archaic. Some of them had flint-lock arquebuses 
 or gingals, which rested on the front-rank man's 
 shoulder when the rear-rank man fired his weapon. 
 Others had slightly more modern muzzle loaders ; 
 there were breech loaders of every date and army 
 under the sun, some of them being the German needle 
 gun of 1866, others the French. There was also our 
 first breech loader. Whatever system they had of 
 supplying and keeping available ammunition for use 
 on active service or manoeuvres, the task of the officer 
 who was in charge of their ammunition must have 
 been almost an impossible one. 
 
 There are many other ways in which we must boldly 
 advance to place our industrial and agricultural 
 sources of wealth on a sound basis. Every effort 
 should be made by up-to-date methods to seek fresh 
 openings for our trade both at home and abroad. 
 The interests of both employer and employees are 
 mutual, and not antagonistic, and everything that 
 tends to their mutual co-partnership is to the national 
 good, while it lessens the possibility of strikes and lock- 
 outs which have been too frequent in recent years. 
 Let those who call themselves either statesmen or 
 politicians in this country realise that this question 
 of our imperial and national trade is purely an 
 economic one the solution of which, in times of peace 
 and in times of war, is for the benefit of the Empire 
 as a whole, and the United Kingdom as part of that 
 whole. It should, therefore, be treated as a strictly 
 non-party question. Mr, Bonar Law, now Chancellor 
 of the Exchequer, said at a meeting of the Associated 
 Chambers of Commerce held last April : 
 
INDUSTRIES WE SHOULD KESTORE 25 
 
 "I do not believe the people of this country will 
 ever allow the Germans to exploit the markets of the 
 Empire as they did before the war, and that all ques- 
 tions relating to our future trade policy will be con- 
 sidered from a new starting point " ; 
 
 and, having pointed out that Adam Smith's words 
 were true (" security must be regarded as greater than 
 opulence "), he went on to say that he deemed it our 
 duty, and he would certainly deal with matters relat- 
 ing to our trade policy in that spirit, to see to what 
 extent — 
 
 " we could get agreement, and only if agreement is 
 impossible should we have to fight about it, and 
 when the time came for reconstruction we ought not 
 to quarrel more than we can help." 
 
 There is no doubt that we must look at this grave 
 economic question from a business point of view, and 
 discard all the idealistic,'sentimental, "good example '* 
 theories and other discredited dogmas of the past. 
 When we have a carefully framed import tariff, and 
 have recovered our bargaining power, we shall be in 
 a position to give or receive concessions from Greater 
 Britain, our Allies, and other nations. We shall be 
 able to look at the question from a general standpoint 
 as to the possible benefit that would accrue to all the 
 interests involved. 
 
 There are many industries which we should again 
 restore on as large a scale as possible to their former 
 importance, including the manufacture of aniline 
 dyes, glass, automatic machinery, silk, optical glass, 
 typewriting machines, machine tools, pharmaceutical 
 requirements, guns, sugar refining, the margarine in- 
 
26 ''WATCHMAN, WHAT OF THE NIGHT?" 
 
 dustry, and others. At Warrington, for instance, 
 many years ago there were three flourishing glass 
 works and one manufactory where they made machine 
 tools. Even then their owners complained of the 
 dumping system and the unfair foreign competition, 
 and they all, unhappily, have since then had to give 
 up their works and discharge their workpeople. It 
 must be clearly seen by anybody that if a manu- 
 facturer does not find his works pay, he first discharges 
 some of his workpeople, then possibly he endeavours 
 to reduce his establishment charges, and is in conse- 
 quence unable to keep his works as efficient as they 
 previously were. If in the end he finds that he is 
 still losing money, he has reluctantly to give up his 
 business altogether. Of course, as was previously 
 mentioned, it would be best if all parties in the State 
 would unite to place our industrial and commercial 
 interest on a firm basis, but have we any sign that 
 such will be the case ? It seems well that the impor- 
 tance of this matter should not be swept aside in 
 favour of questions which are more sensational, but 
 really less vital. W^ith what confidence can a British 
 manufacturer now either enlarge or improve his works 
 or machinery if he is not safeguarded against the 
 unfair attacks to which he w^as subjected before this 
 war commenced ? 
 
 It is clearly essential, if our industrial activity is to 
 advance progressively, that we should have the latest 
 and best methods of production, modern machinery 
 in our works, and in many manufactories advanced 
 technical science and efficient analytical chemists. 
 We have to hand the requisite means of transportation 
 in the shape of railways, roads, and our mercantile 
 
OUR NATURAL ADVANTAGES 27 
 
 marine, while the natural advantages of England for 
 commerce are extremely favourable. Our island has 
 a temperate climate suitable for manual labour, it has 
 good harbours around its entire coast, and many 
 navigable rivers. In addition to this we possess in 
 the British Empire large and numerous dependencies, 
 which give an outlet to our surplus population, where 
 we ought to find lucrative employment for our capital 
 and markets for disposing of our products as well as 
 for supplying our wants. To these natural advantages 
 we can also add the fact that England is an old-estab- 
 lished country, with a settled form of Government, 
 and that its inhabitants are a strong, enterprising, 
 and, as a rule, industrious race, enjoying perfect 
 liberty, perfect security of property, and perfect 
 administration of the laws. This country ought, 
 therefore, to be second to none in commercial pros- 
 perity. In regard to the transport of heavy goods in 
 the interior of the country and to the ports, many of 
 the canals are of slightly antiquated construction, and 
 the fact that the locks are of different gauge very 
 often causes a break of the bulk to be imperative in 
 the transmission of merchandise. We are at some 
 disadvantage in that respect in comparison with 
 France, Belgium, Holland, and other countries, where, 
 as a rule, uniformly constructed canals are to be found 
 under the control of the various Governments, and 
 where the charges for freight are, as a rule, consider- 
 ably less than those levied on the English canals. 
 
 There has been in some quarters a suggestion that 
 prohibition of our imports from certain countries 
 would be the best mode of dealing with the industrial 
 competition we shall have to face in the future, and 
 
28 ''WATCHMAN, WHAT OF THE NIGHT?" 
 
 curiously enough, this idea emanates from those who 
 have identified themselves prominently with the 
 policy known as Free Trade. Have they ever considered 
 that prohibition is virtually protection in its strongest 
 form, and, of course, the very antithesis of a Free 
 Import system, or have they made this proposition 
 knowing that any such proposal, if carried into effect, 
 would be merely a temporary regulation? The in- 
 ducement to evade it would be great ; certificates of 
 the origin of goods would lead to endless disputes, 
 and the goods from countries which do a large transit 
 trade, such as Holland, Belgium, Denmark, or Switzer- 
 land, would be constantly, rightly or wrongl}^, under 
 suspicion at our ports of entrance. In the case of a 
 tariff, evasion is very seldom tried, but if there were 
 absolute prohibition there would be greater induce- 
 ment to attempt it. The originators of this prohibi- 
 tion idea have been credited with its advocacy in 
 order to " side track " the sensible and practical plan 
 of a carefully framed General Import Tariff being 
 charged on commodities at our customs. 
 
 Many reforms might be carried through, no doubt, 
 which would aid our industries and trade, such as 
 improvement in our Company Laws, as previously 
 indicated, the adoption of the metric sj^stem, and the 
 increased study of foreign languages and customs. 
 Our manufacturers might also learn to adapt their 
 goods to the requirements of the people to whom their 
 agents sell them, while our consular service might lay 
 itself out more than it has done to assist British trade. 
 All these, however, are minor changes, useful though 
 they would be if carried out. The main thing to be 
 kept in our mind is that without a thorough change in 
 
THE POWER OF BARGAINING 29 
 
 our fiscal system, no other remedy would be anything 
 more than a slight palliative. That change must be 
 made to meet the altered condition of the world's 
 system of industrial and commercial competition. 
 You cannot build a house without foundations, and 
 the foundation of trade is the power to bargain. Many 
 people who touch on this question only seem to deal 
 with the fringe of it, and try to evade the difficulties 
 they must see by making proposals of sometimes a 
 useful, but nearly always of a comparatively trivial 
 character. 
 
 A few years ago unemployment was rather more 
 prevalent than usual in this country, as many of our 
 centres of industry were short of work, and there was 
 a certain amount of discussion going on in regard to 
 our system of trade and tariffs. About this time Mr. 
 Haldane (now Viscount Haldane) addressed a meeting 
 on those topics at the Caxton Hall, Westminster. The 
 discourse lasted for about two hours, flowing on like 
 water down a meandering brook, or oil being poured 
 from a barrel ; the words were well chosen and the 
 sentences carefully turned ; but the hearers were not 
 much enlightened as to what he really thought on the 
 subject they had all come to hear about, or what 
 practical remedy he advocated in order to encourage 
 trade and industry in this country. In fact, the only 
 suggestion he threw out, besides the advantages of 
 increased facilities for technical education, which no 
 one disputes, was that it was desirable to remit the 
 excise duty on alcohol used for manufacturing purposes, 
 and that amongst other products which could be 
 thereby manufactured more cheaply were synthetic 
 billiard balls, which, we were told, were an excellent 
 
30 ''WATCHMAN, WHAT OF THE NIGHT?" 
 
 substitute for ivory ones. Whether the unemployed 
 were to manufacture these rather superfluous articles 
 of commerce, or to employ their spare time playing 
 billiards with them, he did not explain. 
 
 Clearly permissive legislation in this country is 
 nearly always a failure. Had the Daylight Saving 
 Bill been made only permissive instead of obligatory, 
 it would never have come into use as smoothly and 
 satisfactorily as it has done. Touching on that subject, 
 reference might be made here to a step we should not 
 delay in taking for the purpose of encouraging our 
 commercial relations with two of our Allies, namely, 
 France and Italy. We should alter to the metric our 
 old-world and highly complicated system of weights 
 and measures, and let us hope that Russia will also 
 effect the same change. We have made many efforts 
 to do so before now. In 1862 and 1895 selected com- 
 mittees of the House of Commons inquired into the 
 matter and most strongly supported its adoption. Its 
 terms of reference of the latter committee were to 
 inquire whether any and what changes in the system 
 of weights and measures should be adopted ; the 
 seventeen members included Sir Henry Roscoe, Sir 
 Samuel Montagu, Mr. Justin McCarthy, Sir Albert 
 Rollit, Mr. Alban Gibbs, and the author of this work, 
 and their findings may be indicated in the following 
 summary of the report : 
 
 The Committee received evidence from witnesses 
 representhig official, commercial, manufacturing, trade, 
 educational, and professional interests ; also resolu- 
 tions in favour of the change from numerous Corpora- 
 tions, School Boards, and other public bodies. Almost 
 all the witnesses expressed strong opinion as to the 
 
THE METRICAL SYSTEM 31 
 
 complicated and unsatisfactory condition of our present 
 weights and measures, which was a distinct and 
 serious drawback to our commerce, especially our 
 foreign trade. The evidence, moreover, went to show 
 that not only was our foreign trade in every branch 
 seriously handicapped, but that the home trade would 
 be benefited if more simple and uniform standards of 
 weights and measures were adopted. Evidence from 
 competent witnesses showed that a compulsory change 
 from an old and complicated system to the metrical 
 system had taken place in Germany, Norway and 
 Sweden, Switzerland, Italy, and many other European 
 countries without serious opposition or inconvenience ; 
 that it was carried out in a comparatively short period, 
 and that as soon as the simple character of the new 
 system was understood it was appreciated by all 
 classes of the population, no attempt being made to 
 use the old units or to return to the old system. 
 Finally the Committee recommended : 
 
 (a) That the metrical system of weights and 
 measures be at once legalised for all purposes. 
 
 (b) That after a lapse of two years the metrical 
 system be rendered compulsory by Act of Parlia- 
 ment. 
 
 (c) That the metrical system of weights and 
 measures be taught in all public elementary 
 schools as a necessary and integral part of arith- 
 metic, and that decimals be introduced at an 
 earlier period of the school curriculum than is the 
 case at present. 
 
 This was in July 1895. The sole result was a Bill 
 " to legalise " — that is to say, make permissible — the 
 use of *' weights and measures of the metric system," 
 
32 -WATCHMAN, WHAT OF THE NIGHT?" 
 
 and it became an Act of Parliament (60 and 61 Vict, 
 ch. 46), August 1897. There was no clause to make 
 it compulsory, and we find ourselves still suffering 
 to-day from the greatest hindrance to our trade in 
 many of the most important open markets of the 
 world, notably in Latin America, to say nothing of a 
 quite needless amount of work and expense to our 
 shippers and manufacturers in their dealings with 
 foreign States. It is to be hoped that this useful and 
 practical reform may not be much longer delayed. 
 
 Our country is, or may we now correctly say has 
 been, committed, to use a current expression, to a 
 " wait and see " policy. Our principle has been that 
 once we make up our minds to take a certain line, 
 whether we find it right or wrong we stick to it, but 
 the time may arrive when we shall have to decide 
 whether our commercial system exists for the good of 
 England or whether England exists to prove the correct- 
 ness of the theories of certain political economists. 
 Put what adjective you choose before the word " trade " 
 — "free" or anj^thing else — it consists solely, as a 
 matter of fact, of the mutual interchange of com- 
 modities. Free trade is at best but an abstract pro- 
 position, and even its disciples have to admit that 
 only one nation on earth, namely, Great Britain, has 
 seen fit to adopt it. It becomes simply free-import 
 trade to ourselves ; nor have we left even the most 
 flimsy fence to safeguard the just interests of our 
 industrial population, so complete has been our 
 sacrifice at the altar of the Early Victorian school of 
 economic theorists. Owing to this fact our industrial 
 and banking position had to endure a severe strain at 
 the beginning of the war, and for some time we had 
 
ECONOMIC RIVALRY NEVER CEASES 33 
 
 neither sufficient products to our hand for munitions 
 of war, nor even khaki dye for the cloth of our soldiers' 
 uniforms. Contrast our position with that in which 
 our enemies, who were completely prepared, found 
 themselves. That our industrial system was defective 
 when war broke out is obvious. It is equally unsuit- 
 able for times of peace, as, owing to the fact that it is 
 completely defenceless, and without power of reprisal, 
 it invites attack and the economic warfare of our 
 enemies. We therefore doubtless run the risk of de- 
 pression to our industries and consequent unemploy- 
 ment and distress. We must recollect that commercial 
 rivalry and the battle for trade never cease betwixt 
 the industrial communities of the world. 
 
CHAPTER III 
 
 DANGERS OF ECONOMIC DEPENDENCE 
 
 " Had the British Navy failed to prevent from the outset the 
 egress of the enemy's fleet from German waters, or had the latter' s 
 submarines been far more numerous, the threatened starvation of 
 Great Britain might long ere this have spelt national humiliation 
 and defeat." — Speech by Mr. Charles Bathurst, M.P,, in the House of 
 Commons, February 1916. 
 
 Trade interest and national welfare are so intertwined 
 that they cannot be treated separately. Quite apart 
 from the idea of a self-contained Empire there is the 
 idea of Britain as a fully organised nation, as com- 
 pletely organised as any nation in the world, in an 
 economic sense. No one openly advocates that the 
 national policy shall be only one of drift, though there 
 are certain persons who by their attitude seem to 
 resent any attempt to steer the ship of State along a 
 definite course. 
 
 The industry which has the most important bearing 
 on the welfare of any country must be agriculture. 
 Taking the last clear year before the war we find that 
 we imported into the United Kingdom food, drink, and 
 tobacco to the extent of £290,000,000 ; raw materials 
 £282,000,000, and manufactured articles £194,000,000, 
 whilst our imports of agricultural products, which are 
 also in part produced in this country, were £242,000,000 
 
 34 
 
ONE LESSON THIS WAR TEACHES 35 
 
 less £46,000,000 for re-exports of which the British 
 possessions sent us £91,000,000. Eggs and poultry 
 are imported to the value of 10*7 millions, of which 
 only a very small fraction come from British posses- 
 sions. 
 
 During a European war of the first magnitude we 
 appear to have tacitly accepted certain risks ; firstly, 
 a grave limitation of our food and other supplies, and 
 also the withdrawal of our Navy from its first duty to 
 that of watching and protecting the various trade 
 routes. If we produced more agricultural food- 
 stuffs within the British Isles w^e should effect a 
 further insurance of our safety over and besides any 
 that the naval and military forces of the Crowai 
 afford. 
 
 It has always appeared a mistake on the part of the 
 economists and political agitators in the middle of the 
 nineteenth century, between 1840 and 1850, that they 
 utterly ignored agricultural interests, and left the 
 State dependent for the material wealth of our nation 
 entirely on the manufactures and commerce arising 
 therefrom, for a State relying solely on manufactures 
 is not as stable as one which has a dual security for its 
 prosperity, and has, in consequence, a larger field of 
 employment for its labour. 
 
 What is really required is a well-considered national 
 policy for the utilisation of the land of the United 
 Kingdom, and also one which will both preserve and 
 increase our manufacturing industries. Let us take a 
 lesson from what we have seen during the present 
 grave contest. The strength that Germany has shown 
 and the power to maintain the offensive even when 
 cut off to a large extent from her foreign trade are, in 
 
36 DANGERS OF ECONOMIC DEPENDENCE 
 
 a great measure, due to her policy of thoughtful 
 preparation. She has made the most of her natural 
 resources in all respects ; nor can we shut our eyes, 
 as an island Power, to the fact that submarine w^arfare 
 has greatly developed, and may, in future, develop to 
 an even greater extent. That being the case we ought 
 to consider the possibility of having to face at some 
 future period in our history a blockade of the British 
 coasts of so stringent a character that only a few ships 
 could slip through. The consequence of our great 
 neglect of agriculture in the past has been the migration 
 of a large proportion of the agricultural population to 
 the towns, which, during times of depression, has 
 caused a congestion of the labour market, and de- 
 veloped discontent. After this war there will be, as 
 after the Franco-Prussian War of 1870, at first, ample 
 employment to replace the wastage of war. That, 
 however, may be only a temporary revival of in- 
 dustrial activity. We shall really have to ask our- 
 selves whether a review of the whole national policy 
 has not become necessary. The heavy expenses which 
 we bear for our Army and Navy are in the nature of 
 a national insurance. W^e may also have to insure in 
 another direction by taking steps to maintain an 
 enhanced food supply. 
 
 Anyone who will compare the amount of rates and 
 taxes levied on land with any other description of 
 property of similar value will see what an unfair pro- 
 portion it bears, and that those who levied it appear 
 to have been blind to the fact that land must be the 
 matrix of all food which can be produced in the 
 United Kingdom or anywhere else. It is also to be 
 taken in account that the greater part of this taxa- 
 
RISE AND FALL IN PRICE OF WHEAT 37 
 tion was piled up on to the country by the middle- 
 class trade community in the last century, a large 
 proportion of whom had strong views about the so- 
 called landlord interest to which they were in political 
 opposition. These men appear to have lost sight of 
 the fact that whilst they were injuring the landlords, 
 their policy would cause the country to be less self- 
 supporting in consequence of the land not paying 
 adequate remuneration for its thorough cultivation, 
 and that they were driving from the country the 
 sturdy yeomanry and peasantry of the United Kingdom 
 and causing them to emigrate, or to join the ranks 
 of the unemployed. 
 
 The influence of the price of wheat on the price of 
 bread, it may be here stated, has been grossly exag- 
 gerated. The charge for carriage is a very material 
 consideration, also the cost of labour in the milling, 
 baking, and distribution, and the profits of the 
 middleman and his workmen at each stage. The 
 rent of premises, the burden of taxation, and other 
 countless matters also enter into the actual cost of 
 the bread as sold by the retail baker, including his 
 rental, taxation, and general expenses, so that the re- 
 imposition of the registration duty in 1902 did not 
 raise the price of bread ; on the contrary, after its 
 remission, its price and that of flour rose. Probably 
 that rise might have been caused to some extent by 
 the opinion getting abroad, as was actually the case, 
 that less home-grown wheat would be raised in this 
 country to compete with the foreign-grown grain. 
 
 The cost of food and the necessaries of life are not 
 less in the United Kingdom than in normal times they 
 are in protectionist countries. For instance, in the 
 
38 DANGERS OF ECONOMIC DEPENDENCE 
 
 United States of America, where the writer made 
 inquiries on his last visit four years ago, it was found 
 that whilst the rate of wages was, as a rule, nearly- 
 double that which obtains in the United Kingdom, 
 the cost of food was about the same. The free-trade 
 juggernaut which has swept over the land since about 
 1850 has only succeeded in allowing the foreigner to 
 push aside and destroy many useful and prosperous 
 British industries and manufactures, but has not de- 
 creased the cost of food at all. 
 
 During the Crimean War of 1855 we had, as now, 
 to import a great deal of wheat. The sea was open to 
 us as it is at the present time, submarines had not 
 been invented, and mines were then in their infancy, 
 and yet the price of bread rose then to 745. Sd. per 
 quarter. During the present v/ar it has reached the 
 sum of 825., and yet we hear nobody making an 
 outcry on the matter, and issuing flamboyant posters, 
 as they do during elections, about the big and little 
 loaf of the political fable. We owe the high price of 
 bread in war time entirely to the fact that we only 
 grow food for one-third of the population. Bread 
 was less than half the price it is now under Protection 
 in the " hungry forties," as they were called. A great 
 deal of capital was made at that time out of the 
 depression of trade, but that was not caused by the 
 price of bread, but by the money famine resulting from 
 the action of the United States in decreeing that all 
 payments to their Government were to be made in 
 specie for purposes of land, etc., and also from our 
 faulty bank Acts of that date. This caused industrial 
 trouble and a great want of employment, and the 
 people had not the money to buy bread, though there 
 
AGRICULTURAL DEPRESSION 39 
 
 was plenty to be sold at reasonable rates. Looking 
 farther back to the year 1765, under stringent protec- 
 tionist corn laws the price of wheat on the average was 
 only about half what it is now under so-called ''Free 
 Trade," and averaged 335. 3d. per quarter. In 1888 
 wheat was cheaper in the Colony of Victoria, Australia, 
 where the duty was 9s. Sd. per quarter, than it was in 
 New South Wales, where it was free, as the absence 
 of a duty discouraged the growth of wheat in that 
 colony, and a great proportion of it had to be imported 
 from other places. 
 
 We have had commission after commission to in- 
 quire into the depression of agriculture, and all these 
 commissions of 1879, 1885, 1893, and 1897 give evi- 
 dence in their reports of the unsatisfactory condition 
 of the land question in the United Kingdom. In the 
 supplementary report of the Royal Commission of 
 1897 it is stated that the majority of witnesses gave 
 evidence that the only effective remedy for the depres- 
 sion of agriculture was a return to Protection, and 
 that any other suggested proposals were merely tem- 
 porary palliatives. Had Adam Smith been aware 
 that the import of grain would have been 1,800 times 
 as much as that on which he based his conclusions in 
 regard to the abolition of the corn laws, it is very 
 doubtful whether he would have made such a sugges- 
 tion, yet that is the increased proportionate import 
 of food in the United Kingdom since his day. 
 
 The prophecies made by the advocates of our pre- 
 sent fiscal policy have hardly been fulfilled in such a 
 way as to inspire confidence in that policy. Cobden 
 during his agitation in support of Free Trade stated 
 that "not an acre of land would go out of cultiva- 
 5 
 
40 DANGERS OF ECONOMIC DEPENDENCE 
 
 tion." In regard to that one would remark that more 
 than three milHon acres of corn and crops dropped 
 out of cultivation between 1871 and 1907. Again it 
 was stated, " Sufficient natural protection would be 
 given to our agriculture by the cost of freights and 
 charges on imports." This is not borne out by the 
 facts. In many cases the cost of transport from the 
 Continent is less than the transport by rail from many 
 parts of our country to London. 
 
 Anyone who looks into the question will see that 
 no industry has suffered so much from unrestricted 
 free imports in this country as agriculture, and, as we 
 have endeavoured to show, no industry has been so 
 completely the victim of miscalculations by the original 
 free-traders. We are going backwards in all that 
 constitutes the real strength of a nation. No doubt 
 we have accumulated wealth, a large proportion of 
 which was made during protectionist times, and in the 
 present abnormal times we are making money chiefly 
 as middlemen. That is to the good, no doubt, but the 
 people's welfare is much more important ; and having 
 destroyed to a large extent our greatest industry, the 
 backbone of any industrial community, namely, agri- 
 culture, we are, in our worship of temporary cheapness, 
 watching with folded arms and fantastic resignation 
 the gradual underworking of our manufactures. The 
 only satisfactory thing that has come to light respect- 
 ing agriculture during this great war is that the 
 British consumer has been protected from a rise in 
 the price of meat which w^ould have made it a rare 
 luxury for the vast masses of the population, only by 
 the policy which is maintained and encouraged of the 
 breeding and feeding of stock in the United Kingdom. 
 
CONFIDENCE THE LIFE-BLOOD OF INDUSTRY 41 
 
 Many will ask, " What has the Government done to 
 encourage the home production of meat 1 " The 
 answer to this is that the restrictions first imposed by 
 Mr. Walter Long on the importation at our ports of 
 live animals into the United Kingdom early in this 
 century have been continued, in consequence of which 
 their coming here has practically ceased. Thus as a 
 Government Commission appointed by the present 
 Board of Agriculture have had to acknowledge, the 
 result has been (to quote the words of their report), 
 " that the only way to get cheap food is to develop 
 and protect the home production." 
 
 It is a matter of satisfaction that this Commission 
 has seen fit to acknowledge that self-evident proposi- 
 tion, for it seems obvious that the breeding of live stock 
 on one side of the world and their consumption on the 
 other is neither, as the Cobdenites would claim it to 
 be, " a design of Nature," nor is it practical common 
 sense. Our farmers have had some confidence in 
 consequence of this prohibition of the importation of 
 live stock, and they have, in consequence, increased 
 their stock of cattle. Confidence and security are, 
 indeed, the life-blood of agricultural or manufacturing 
 industry. Even Mr. Cobden himself, speaking in 
 London in 1845, acknowledged that fact when he said : 
 "It is admitted by the highest authorities in the land 
 that capital shrinks from insecurity of tenure, and 
 we have not in England that security which will 
 warrant men of capital investing their money in the 
 soil." 
 
 If that was the case then, how much more is it so 
 now! Our oldest and greatest industry has been 
 allowed to gradually dwindle and fail. An effort 
 
42 DANGERS OF ECONOMIC DEPENDENCE 
 
 should be made in this country by those interested in 
 production, masters and men combined, to organise 
 themselves and take all the necessary steps to let the 
 Government of the day understand that their interests 
 cannot be ignored for the supposed temporary advan- 
 tage of the consumer. What we really require is not 
 a temporary cheapness caused by the dumping of 
 goods or for any other cause, but a continuous supply 
 of produce and articles of commerce at a steady rate. 
 
 With this combined effort on the part of the pro- 
 ducing community, one of the first objects to be 
 attained would be a gradual understanding between 
 agriculture and labour, and also united action amongst 
 the manufacturing interests. By their combined 
 action the Government could probably be induced to 
 establish a system of tariffs by means of which we 
 should have freer trade. If we established more of 
 an equilibrium between direct and indirect taxation, 
 such as was once the case in this country, we should 
 receive a great part of the large revenue which we 
 now require from the foreigner through his paying 
 custom duties on our imports, as well as raising money 
 more easily and in a way which would give more im- 
 petus to thrift and economy than unduly heavy direct 
 taxation would be likely to do. Another result would 
 be, not, as some allege, that by Protection we should 
 shut out foreign goods from our markets, but that a 
 number of industries would be revived in the country 
 by the feeling of increased confidence in the prosperity 
 of manufacture. 
 
 After the South African War, when our troops who 
 were engaged were few compared with the millions 
 now in the field, our returning soldiers sought in great 
 
EMPLOYMENT FOR DISCHARGED SOLDIERS 43 
 
 numbers an outdoor life on the land, and could not 
 settle down after their campaign to manufacturing or 
 commercial life. So it will undoubtedly be after this 
 war. If these discharged soldiers cannot find an 
 outlet for their energies in agriculture in the United 
 Kingdom, they will emigrate. Should that emigra- 
 tion assume very large proportions we should lose 
 immense numbers of the most active and enterprising 
 of the population, besides which, those who remain 
 would have to bear the increased burden of taxation. 
 Therefore it would seem a wise policy to use every 
 effort to employ to the fullest extent this undeveloped 
 national asset. 
 
 One way to increase the demand for employment in 
 the United Kingdom, and at the same time to increase 
 our food supply, would be by an intensive cultivation 
 of the land. The increase of our food supply, the 
 need for which is becoming yearly greater, would 
 naturally be of great national benefit. We shall have 
 to work harder to make up for the wastage of treasure 
 caused by the war, and no effort should be spared to 
 find useful and remunerative employment within the 
 United Kingdom of a productive character. There is 
 no doubt that many of those men who are discharged 
 from the Army and Navy at the termination of the 
 war will be very well adapted for, and will quickly 
 acquire proficiency in, agriculture or any other indus- 
 trial calling. The senior service has been credited with 
 possessing " handy men," but in the Army, and 
 especially in the scientific branches of it, namely the 
 artillery and Engineers — and now, we should add, the 
 Flying Corps — as well as in the cavalry, guards, and 
 infantry, there are a very large number of men cap- 
 
44 DANGERS OF ECONOMIC DEPENDENCE 
 
 able of adapting themselves to any matter they set 
 about. When in 1915 the author was commanding a 
 divisional ammunition column of the R.F.A. of the 
 New Army, the quickness with which the men learned 
 their various duties was most satisfactory, without 
 referring in detail to their purely military work such 
 as learning to ride, drive, gun drill, range finding, 
 sketching, signalling, musketry, mounted and dis- 
 mounted drill, horse and mule keeping, and entrench- 
 ing. Many of them were sent to go through courses, 
 and most of those passed as farriers, shoeing smiths, 
 saddlers, fitters, wheelwrights, telephonists, etc., while 
 others, of course, had to work as tailors, cooks, butchers, 
 hair cutters, and mess servants during part of their 
 time. The men who have gone through their duties 
 in the Navy or Army during this stern time will have 
 also learnt discipline, and the value of co-operation 
 and of helping one another under all circumstances, 
 and of taking things as they come without complain- 
 ing, and most of them should, therefore, prove very 
 useful in civil life. It ought not to be impossible to 
 settle large numbers of them in small holdings on the 
 land. 
 
 The decline of British agriculture during the last 
 forty years has been marked, and the gross produc- 
 tion of the soil of this country has been gradually 
 declining since 1892. There has been practically no 
 reclamation of the areas of waste land in Great Britain 
 of recent years ; a vast amount of arable land has been 
 turned into pasture, so that since 1872 there has been 
 a decrease of no less than twenty-six per cent, of arable 
 land, or from over thirteen milHon eight hundred 
 thousand acres of arable land to, in 1914, about ten 
 
STEADY DECREASE OF ARABLE LAND 45 
 
 million three hundred thousand. This was caused 
 by the heavy fall in prices which set in about forty 
 years ago and continued till a few years before the 
 war. The smaller amount of arable land has caused 
 a diminution in the number of sheep kept, as they 
 are largely fed on root crops. On the other hand, 
 there has been an increased head of cattle raised. In 
 value, however, the increase in the number of cattle 
 only about balances the loss on the fewer number of 
 sheep. 
 
 Land under the plough produces, besides the grain 
 grown for human food, the same amount of sustenance 
 for cattle as the same acreage under grass. During 
 the last forty years it is stated that six thousand men 
 have left agriculture, and three and a half million acres 
 of arable land have been turned into grass. This 
 number would have been greater but for the fact that 
 many of the men transferred their work to market 
 gardening, fruit, or flower growing. On the other 
 hand, self-binders and other newly invented agricul- 
 tural machines have enabled the farmer to work his 
 arable fields with fewer hands ; also many of the best 
 men have gone into other callings or have emigrated. 
 
 England has adopted a policy similar to that carried 
 out by the executive of the Roman Empire just before 
 its downfall, i.e. heavy direct taxes, contracted cur- 
 rency, and dependence on foreign nations for the 
 supply of food. Essex was once one of the chief 
 corn-growing districts of England. Unfortunately 
 that is a thing of the past now. The Campagna was in 
 ancient times the source of the supply of corn for the 
 Romans. That also ceased, and the Romans de- 
 pended on supplies from abroad. In the days of the 
 
46 DANGERS OF ECONOMIC DEPENDENCE 
 
 Emperors somebody evidently raised the cry of " the 
 big and little loaf " in Italy, and in consequence 
 the rural population has disappeared, and the land 
 has been left uncultivated. 
 
 Since 1900 there has been some increase in the price 
 of cereals and stock, and a better inquiry for land and 
 for farms when the latter were to let. Since 1910, 
 also, agriculture has been slightly less depressed, and 
 this continued up to the outbreak of the war. In 
 addition to this, labour has, in recent years, been able 
 to secure better Avages. 
 
 But the farmer has felt little confidence in the 
 permanence of the improvement in the price of his 
 produce since 1910, and arable land has continued to 
 be turned into pasture. A large number of farmers 
 possess little capital, and look on their occupation 
 simply as a means of livelihood. Though there are 
 brilliant exceptions, most farmers do not carry out 
 the modern scientific mode of making the most of the 
 land, and have not taken advantage of the technical 
 education which has been at their service for the last 
 twenty years. Many of them hold more land than 
 they have capital to develop properly, and use it 
 more as ranchmen than as farmers. The industry 
 does not attract many of those seeking for a fresh 
 opening. Men engaged in it prefer a certain though 
 small return for their work and capital, and do not 
 wish to embark on any adventure in improving the 
 output from the land they farm which they deem 
 would give them trouble or involve risk. 
 
 When land is under the plough it is estimated that 
 it will produce of either meat or milk as much as 
 pasture land would yield, besides the wheat or other 
 
SHORTAGE OF FOOD, A NATIONAL DANGER 47 
 
 grain grown on the arable land. On the other hand, 
 the farmer has always before his eyes the ever-fluctuat- 
 ing price of his grain crops, which, as a rule, during 
 the last forty years, or until the last decade, has been 
 constantly in the downward direction. He also takes 
 into account the greater amount of capital required 
 on arable land, and the risk of bad weather spoiling 
 his wheat and other cereals. The work of supervision 
 has to be more constant, and many more workpeople 
 have to be employed ; and he considers the profits, 
 though probably slightly more, not worth the anxiety 
 and risk incurred in trying to make them. The 
 majority of British farmers will tell j^ou that if they 
 can hire land cheaply, they consider it a safer invest- 
 ment to use it for grazing purposes than to grow crops 
 on it. We have, therefore, this strange position of 
 affairs, that in many parts of the United Kingdom 
 farms which are situated near large cities and towns, 
 and which, if only cultivated by modern methods of 
 agriculture, would produce excellent crops that could 
 not be surpassed, are now mostly used for grazing, and 
 grow year by year less instead of more produce. 
 
 The land being the matrix of the internal food 
 supply of the country, a remedy for this state of affairs 
 should be found. The interests of the community 
 should be protected by their own action, and, if 
 needful, a definite, carefully considered system of 
 State aid should be adopted to encourage the growth 
 of more food in the United Kingdom. Certainly, as 
 an insurance against the possible shortage of food in 
 times of war, and as a means of employing men upon 
 the land and reducing our heavy national indebted- 
 ness, our aim must be that the State should endeavour 
 
48 DANGERS OF ECONOMIC DEPENDENCE 
 
 to encourage a more thorough mode of cultivating 
 and utilising the land of the country by intensive 
 modes of farming, and the cultivation of a greater 
 acreage of land under the plough, thus giving employ- 
 ment to a larger number of men, and decreasing the 
 amount of food imported from abroad. 
 
 Since 1901 the home proportion of the supply of 
 meat consumed in the United Kingdom has increased 
 slightly, and now approximates to sixty per cent, of the 
 whole. An interesting geographical fact is to be 
 noted in the almost complete diversion of the im- 
 ported beef supplies of the United Kingdom from the 
 northern to the Southern Hemisphere, namely, from 
 the United States of America to the Argentine Re- 
 public and Australia. The deficiency in the home 
 supply is now made up nearly entirely from the two 
 latter countries. This transference can best be indi- 
 cated by the fact that whilst in the years 1901-5 
 Australia sent only 2' 3 per cent, of the imports of beef 
 to these shores, in 1911-13 the percentage had increased 
 nearly sixfold to a total of 12*2. The Argentine Re- 
 public increased her supply from 32*6 per cent, to 
 80" 5, whilst from the United States it decreased, from 
 the first to the second period named, from 60*5 to only 
 1*2 in consequence, partly, of the greater home demand 
 in that country for their own crops. The imports of 
 mutton come almost exclusively from the Southern 
 Hemisphere. New Zealand is a contributor, with. 
 Australia and the Argentine Republic, and the latter 
 is, in fact, the chief source of supply, though Australia 
 has increased its shipments since 1901. It may be 
 remarked that since 1901, owing to restrictions at the 
 ports of the United Kingdom and the increasing 
 
OUR EXTERNAL FOOD SUPPLIES 49 
 
 facilities for transport of refrigerated beef and mutton, 
 the imports of live animals into the United Kingdom 
 have practically ceased. 
 
 In the case of imports of pork and bacon, the 
 United States of America has also been displaced since 
 the beginning of the century. The imports of fresh 
 pork into the United Kingdom came mainly from 
 the Netherlands, and those of salted pork and bacon 
 from Denmark. Only in the case of hams is the 
 United States still the main contributor. 
 
 It is interesting to record that the consumption per 
 head of population in the United Kingdom of all kinds 
 of meat has, of late years, shown a gradual decline, 
 viz. : 
 
 Average 1901-1905 . . . 13310 lbs. 
 
 1906-1910 . . . 13016 „ 
 
 1911-1913 . . . 128-76 „ 
 
 The above figures refer to meat generally. The 
 consumption of beef remains stationary. As regards 
 mutton there is a slight increase from 27 to 29 lbs. per 
 head, but in pork, bacon, and hams there is a marked 
 decrease from an average of 43 lbs. per head in 1900-1 
 to 35 lbs. in 1912-13. This decline appears to be 
 mainly due to the decreased consumption of hams. 
 
 The United States has now become an importer 
 rather than an exporter of beef, and its competition 
 with the United Kingdom for supplies from the meat- 
 producing countries of the Southern Hemisphere will 
 in all probability increase. There is a substantial 
 increase, however, in the number of live stock in the 
 Argentine. 
 
60 DANGERS OF ECONOMIC DEPENDENCE 
 
 In an official report issued by the Board of Agri- 
 culture and Fisheries for 1913 attention is drawn to 
 the continued rise in the price of all kinds of meat, 
 and to the apparent fact that, for the first time 
 for many years, a higher level of prices cannot be 
 relied on to draw at once additional supplies to the 
 British market. This fact cannot be sufficiently 
 brought home to us all : that the restrictions imposed 
 on the importation of foreign cattle into these isles 
 encouraged the breeding of our flocks and herds within 
 the United Kingdom, and hence kept prices down. 
 This is rather an interesting acknowledgment of the 
 reason why the community have not been short of meat 
 during the years 1914-16, i.e. we have not allowed 
 the importation of live foreign cattle for the last few 
 years, except under great restrictions — and it is also 
 a remarkable proof of the advantages which a country 
 obtains through being partly self-contained, as far as 
 its food supply goes, and thus protected from a rise 
 in prices. 
 
 This statement is issued in the memorandum and 
 tables of the food and raw-material requirements of 
 the United Kingdom prepared by the Royal Commis- 
 sion appointed on that subject and presented to both 
 Houses of Parliament in November 1915 (Cd. 8123). 
 It is the more satisfactory as the Government in 
 appointing the Commission took care, in the terms of 
 reference, to exclude from its consideration the remedy 
 which has been applied in every other State of the 
 civilised world, namely, an import tariff to safeguard 
 its trade, agriculture, and industry — rather like a 
 parent giving permission to his child to go and swim 
 as long as he promised not to get wet. The task they 
 
*' FREE TRADERS " EXCLUDE REAL REMEDY 51 
 
 have been set to do, with the words " consistent always 
 with the existing fiscal policy " before them, is some- 
 thing like trying to j&nd out how to square the circle. 
 It is interesting to note that Lord Crewe had words 
 inserted to the same effect in the resolutions of the 
 recent Economic Conference at Paris, to which refer- 
 ence will be made later, and in that case the words 
 were even more inconsistent with their context than 
 they are in these instructions. The reference to the 
 Royal Commission contains the following passage : 
 
 " We were pleased to authorise and appoint certain 
 persons therein respectively named, or any five or 
 more of them, to be Our Commissioners to inquire into 
 and report upon the natural resources of Our Dominion 
 of Canada, Our Commonwealth of Australia, Our 
 Dominion of New Zealand, Our Union of South Africa, 
 and Our Colony of Newfoundland : and, further, to 
 report upon the development of such resources, whether 
 attained or attainable ; upon the facilities which exist 
 or may be created for the production, manufacture, 
 and distribution of all articles of commerce in those 
 parts of Our Empire ; upon the requirements of each 
 such part and of Our United Kingdom in the matter of 
 food and raw materials and the available sources of 
 such ; upon the trade of each such part of Our Empire 
 with the other parts, with Our United Kingdom, and 
 with the rest of the world ; upon the extent, if any, to 
 which the mutual trade of the several parts of Our 
 Empire has been or is being affected beneficially or 
 otherwise by the laws now in force, other than fiscal 
 laws ; and, generally, to suggest any method ^^, con- 
 sistent always with the existing fiscal policy of each part 
 of Our Empire, by which the trade of each part with 
 the others and with Our United Kingdom may be 
 improved and extended." 
 
52 DANGERS OF ECONOMIC DEPENDENCE 
 
 Even in 1879, when the present writer published a 
 work entitled The Trade of the World, the question of 
 our food supply and the development of the trade, 
 commerce, and industry of the various parts of the 
 Empire was purely an economic one, and what are 
 called politics had nothing or almost nothing to do with 
 the subject. So it should be now. 
 
 It should also be remembered that the question was 
 so non-political at that date that the author had the 
 honour of obtaining the gracious permission of dedicat- 
 ing that work to His Royal Highness Albert Edward 
 Prince of Wales, in the following words : " As a humble 
 testimony of the valuable support continually rendered 
 by His Royal Highness towards the various com- 
 mercial and industrial enterprises of this and other 
 countries." 
 
 We are now even more dependent on a food supply 
 from overseas than we were then, and, without labour- 
 ing that point, we have only to recollect that nearly 
 four-fifths of our wheat supply — or, to give the exact 
 figures for 1911-13, a proportion of 77'9 per cent. — 
 come from abroad of our total requirements for the 
 product which supplies the " staff of life " in these 
 islands. 
 
 On that point some passages from the book just 
 mentioned, The Trade of the World, are equally if not 
 more applicable now than at the time when they were 
 written. The following is quoted from the commence- 
 ment of a chapter on our external food supplies : 
 
 " Great Britain is at present in the somewhat start- 
 ling position of only being able to grow food to supply 
 the wants of little more than half its inhabitants. In 
 
POPULATION INCREASING 53 
 
 whatever way one looks at these general facts con- 
 nected with our food suppHes, they seem to me of 
 extreme gravity. True, it is quite evident that there 
 is no lack either in the will or the power of other 
 nations to produce all the food we may need for the 
 support of our population, and equally so that we 
 have botli the itneans and the desire to manufacture 
 more than sufficient goods wherewith to make payment 
 for the supplies they send ; but the ever-increasing 
 divergence which I have previously noticed between 
 the amount of our purchases and our sales cannot con- 
 tinue growdng to an indefinite extent. Whatever may 
 be our accumulations of wealth at home, they will not 
 suffice to ward off a scarcity of food, if those who have 
 it to give to us will not take the produce of our labour 
 and capital in exchange ; and viewed in this aspect the 
 problem seems difficult of solution. 
 
 " When Adam Smith wrote the Wealth of Nations 
 England was in a far different position in this respect. 
 We were not only able to supply in ordinary years the 
 inhabitants of these isles with home-grown ahmentary 
 substances, but even to export grain. However slight 
 the importance, and with whatever easy flow of trite 
 axioms political economists may attempt to account 
 for it, this country is now much more dependent upon 
 foreign sources of food supply than it was some years 
 ago, and as our population grows the extent of this 
 dependence increases at a more and more rapid rate, 
 and thus two great questions press upon us for solution : 
 first, can we always rely upon these foreign sources, 
 in the event, for instance, of war ? and secondly, can 
 w^e afford to continue to pay for food at the rate we 
 now do without impoverishment ? " 
 
 Another extract will prove of interest here as showing 
 how thoroughly the views then held by the late Lord 
 Beaconsfield have come to pass : 
 
54 DANGERS OF ECONOMIC DEPENDENCE 
 
 " I have in a previous part of this work referred to 
 the immense districts capable of growing corn at 
 present lying waste in Canada and the Cape. Touch- 
 ing the former country, Lord Beaconsfield mentioned 
 in his speech delivered at Aylesbury, September 19th, 
 1879, that ' since the surrender of the Hudson Bay 
 Company, Canada has become an illimitable wilderness 
 of fertile land ' ; and again remarks, respecting the 
 competition of our own agriculturists with those re- 
 siding in the United States, ' that it is a singular cir- 
 cumstance that at this moment the greatest appre- 
 hension is felt in the United States that they cannot 
 compete with Canada. The taxation in America is 
 so high, the rate of wages is so high, that it is impossible, 
 according to some of the best American authorities, 
 that they can any longer continue to successfully 
 compete with Canada. If we are to be fed by Canada, 
 it is at least satisfactory that we shall be fed by our 
 fellow-subjects ' ; and again tells his audience, with 
 regard to the large supply of grain now coming from 
 the United States, that circumstances are of so tran- 
 sitory a nature ' that the very place of competition is 
 doubtful, and when you hear that Canada expects 
 completely and successfully to beat the United States 
 from the European markets, it is wise for us not to 
 take any precipitate steps,' and that it was difficult to 
 estimate the exact result of the 200 millions of acres 
 now lying waste in Canada being gradually brought 
 into cultivation." 
 
 The memorandum of the Royal Commission previ- 
 ously referred to on our food supply points out that 
 this increment has been very rapid recently. The 
 large increase in the proportion of wheat received in 
 recent years from the Dominions is, of course, mainly 
 due to the great extension of wheat cultivation in 
 Western Canada since the beginning of the century. 
 
THE FOUNDATIONS OF STRENGTH 55 
 
 Our imports of wheat from Canada in 1901-5 were 
 on the average 10'3 million cwts., and in 1911-13 had 
 increased to 24*5 million cwts. 
 
 The products of Mother Earth must either be grown 
 in this country or brought from abroad before we can 
 consider the question of utihsing the power of either 
 electricity or steam, or the skill of human dexterity in 
 manufacture. As we have endeavoured to urge in 
 these pages, our neglect of the agricultural interest in 
 the United Kingdom for the last sixty or seventy years 
 has been a false and selfish move, and it was, in fact, 
 nearly a suicidal policy to leave it to chance whether 
 the food of the people would be sufficient, or whether, 
 in case of war, others either could or would supply this 
 country with adequate alimentary substances. Now 
 is the time, if ever, to relay the foundations of true 
 strength, and by that is meant our economic inde- 
 pendence of a foreign food supply in times of stress 
 and war. 
 
 Were a really effective blockade round our coasts 
 at any future date ever to be etlected, how could we 
 ensure a sufficient supply of food for the inhabitants of 
 this country if the land was tilled as at present ? This 
 danger can be surmounted, and must be. We must 
 tackle the question forthwith, and encourage agricul- 
 ture within the boundaries of the United Kingdom 
 fearlessly, making our first and greatest industry one 
 in which all classes concerned can earn a living and 
 find a fair and adequate remuneration for the capital 
 enterprise and technical skill expended in that great 
 calUng. We cannot afford to sell our birthright as a 
 free people to placate, or attempt to placate, a body of 
 impenitent economic fanatics, 
 6 
 
66 DANGERS 01^ ECONOMIC DEPENDENCE 
 
 That British agriculture has been steadily diminish- 
 ing since the middle of last century is a fact that has 
 to be faced, the more especially as not only in the 
 virgin soil of the great American continent, both in the 
 north and in the south, but also in many other European 
 countries, such as Russia, Germany, Holland, Denmark, 
 and others, it has been advancing progressively. Our 
 own agricultural population, once the backbone of the 
 nation and a source of wealth in peace as of strength 
 in times of war, has diminished both in numbers and 
 in wealth. The money they used to expend on manu- 
 factures, mainly, if not entirely, of home production, 
 has not been expended as heretofore, and is therefore 
 lost to this country. 
 
 This diminution in our internal trade has not yet 
 come home to us with sufficient force, as, owing to the 
 accumulation of our past prosperity, w^e have drawn on 
 our resources of capital in order to continue to pay for 
 the supplies of food and manufactured goods we have 
 been year by year importing. 
 
 It would here seem desirable to look at this question 
 of our diminishing food supply both from the point of 
 view of the present growers and from that of the general 
 good of the communit}^ and, having done that, to see 
 whether by some slight concession to the farmer and 
 to the agricultural interest generally we could not 
 utilise the natural wealth of the country, namely its 
 land, have a greater supply of food, and be, as other 
 countries are, to a great extent independent of outside 
 sources of supply. 
 
 A few years ago it paid the farmer in this countrj^ to 
 grow wheat, when it fetched 355. a quarter. In conse- 
 quence of the present rise of prices in all directions, 
 
DECREASE OF LAND UNDER THE PLOUGH 57 
 
 including that of labour, that price may now not be 
 sufficient. But having fixed the level, or the datum 
 line, at which it pays to grow wheat, no skill, no 
 technical education in regard to scientific farming, no 
 organisation, can make arable land in Great Britain 
 pay to groAV, and give the labourers a living wage of 
 say 21 5. a week, if the price falls below that level. 
 And there comes a point when the farmer finds he can- 
 not cultivate arable land at a profit. He then decides 
 that he had better put down the greater bulk of his 
 land in grass. Considering, like the British manu- 
 facturer, that he has no security and finding there is 
 less risk and danger of loss in raising cattle owing to 
 the restriction of importation of foreign live stock, he 
 leaves the growth and cultivation of cereals and 
 vegetables to a great extent, or as far as he possibly 
 can, alone ; and as he is working his farm to make a 
 living, he is probably right from his own point of view 
 in exercising such caution. 
 
 But let us examine the result of this action on his 
 part from a public point of view. Since 1872 to the 
 year 1913, one finds that not only has there been a 
 marked diminution of arable land in England, Scotland, 
 Ireland, and Wales, but there has been also a decrease 
 of land under crops, though it has not been so marked. 
 All the authorities who have studied this agricultural 
 problem agree that land under the plough and growing 
 grain or roots will support a vastly greater number of 
 people than land used for grazing. At the end of last 
 century when the farmers complamed that, owing to 
 foreign competition, aided by cheap freights, land and 
 labour, and light taxation, their produce did not pay, 
 and that in consequence they were giving up their 
 
68 DANGERS OF ECONOMIC DEPENDENCE 
 
 farms and emigrating or going into other callings, they 
 were advised in Midlothian, by the late Mr. Gladstone 
 and others, to grow strawberries ! — no doubt " a 
 refreshing " though not a " rare fruit," nor a sustaining 
 one for an industrial community. 
 
 Such was the remarkable alternative offered by the 
 Free Traders of that date as a remedy for the undoubted 
 agricultural depression then acutely felt by farmer and 
 agricultural workman alike, a depression that will recur 
 unless we sweep awaj^ the cobwebs of an illusion 
 formerly held, and make it possible for the suitable 
 agricultural land of this country to be used for the 
 purpose for which it was intended by nature, namely, 
 to grow cereals and vegetables for human food and 
 for our flocks and herds. Hide-bound as these faddists 
 are by the economic fallacies of a past age, cannot they 
 see tha,t it is a disgrace to a fertile country like Great 
 Britain, with the ocean open to her ships, to be obliged 
 to place her food supply under the orders of a con- 
 troller ? Would they in fact sooner see the food 
 supply of the people unduly restricted than change by 
 one hair's breadth their preconceived doctrines ? 
 
 What was the illusion which has been referred to 1 — 
 that it was a matter of complete indifference how large 
 a proportion of food we imported from overseas, or 
 whether the whole agricultural population of the 
 country left it, and the land was turned into a wilder- 
 ness, or not. The Free Traders did not say this in 
 so many words, but their action in Parliament and at 
 the polling booths proved that they did not care 
 whether this occurred or not. 
 
 Assuming that we were, as Germany now is, more or 
 less effectively blockaded, wheat is the one essential 
 
CATTLE RAISING VERSUS GRAIN GROWING 59 
 
 article of food we could not do without ; of that 
 necessary food a large quantity would have to be 
 stored in Great Britain, or our position would be 
 parlous indeed. The amount of meat used per head 
 of the population could, if necessary, be reduced con- 
 siderably so far as we are concerned, but there is 
 always a considerable reserve of meat in this country in 
 the shape of the breeding stock. 
 
 If the area under wheat in Great Britain were in- 
 creased by the 3,340,000 acres now in grass lands, but 
 cultivated as arable in 1872, and taking the annual 
 yield to be 4 qrs. per acre, the increased home pro- 
 duction to meet our requirements, it has been estimated, 
 Avould be nearly three times greater than it now is, or 
 nearly sixty per cent, of the whole, instead of twenty. 
 Nor would it be found, if this large area of grass land 
 were converted into arable crops, that there would be a 
 loss ; rather there would be a gain in the supply of 
 food for the flocks and herds of this country, as well 
 as largely increased stores of alimentary substances 
 for human sustenance. Milk is already almost wholly 
 produced at home. We also only import yearly, on 
 the average, fruit and vegetables from foreign countries 
 to the "^alue of six millions. 
 
 At the present time of war the large farmer is finding 
 the price both for cattle and grain so remunerative that 
 he is devoting his whole capital, energies, and such 
 labour as he can retain to raising them, and does not 
 think it worth his while to compete to any extent with 
 the small holder in the minor agricultural products, 
 such as fruit and vegetables. In the pre-war period 
 prices were low for grain. The large farmer then, with 
 his power of wholesale working, was enabled to compete 
 
60 DANGERS OF ECONOMIC DEPENDENCE 
 
 successfully in regard to minor products with the small 
 holder, and, in consequence, he kept the prices of 
 vegetables and milk down. The absence of that com- 
 petition may, in a measure, account, together with. 
 the shortage of labour, for the present great rise in 
 price in those minor agricultural products. 
 
 The ideal condition of economic independence for the 
 United Kingdom in regard to the food supplies would 
 be to grow food for all the inhabitants of these Isles. 
 That, however, is not attainable in the region of 
 actuality, as an increase of twenty-four million acres of 
 arable land in this country, even though it is estimated 
 that we have the land available, is not a probable solu- 
 tion of the difficulty. It does not, therefore, come 
 within the range of what is practical or likely to be 
 attempted. 
 
 If we were to grow in the United Kingdom — as no 
 doubt we could, were it so desired — fifty or sixty per 
 cent, of the food required of all kinds, import say thirty 
 or forty per cent, from the Empire and the rest from 
 other sources, our economic condition in every way 
 would be infinitely stronger than it is now. This end 
 can only be attained by the organised effort of the State, 
 as was done in the case of Denmark within a com- 
 paratively short period, in recent years. A great effort 
 took place in that country towards the improvement of 
 agriculture after the disastrous war in 1864, and that 
 effort had a marked success. 
 
 Some hold that the situation could be best met by 
 the guarantee of either a maximum price for wheat or 
 an annual payment of, say, ten shillings per acre for the 
 extension of the arable area in this country for a period 
 of from five to ten years. No doubt this would give 
 
HOW TO ENCOURAGE FARMING 61 
 
 to the farmers some security and some confidence in 
 replacing their grass lands by arable, and provide 
 employment, when this war ends, for great numbers 
 of the discharged soldiers on their return to civil life. 
 There is a diversity of opinion as to whether prices 
 will fall or rise after peace is declared. Some consider 
 that the replacement of the material wealth destroyed 
 and the vast demand for labour in rebuilding and 
 manufacture amongst the nations who have been 
 engaged in hostilities, together with the serious loss 
 of life they have all incurred, will cause less food to 
 be produced, and that its present high price will be 
 maintained for some years ; others, that prices will fall 
 owing to increased industry in food production all over 
 the world. It seems that the fairest, the simplest, and 
 the most equitable way to assist the farmer would be 
 to impose a reasonable duty on cereals imported here, 
 to equalise the incidence of the heavy rates and taxes 
 and consequent heavy charges which land in this 
 country has to bear, and to encourage agriculture. 
 Bounties have to be paid by the State, and are just 
 as much a form of protection as charges levied at the 
 customs on products or goods coming into the country. 
 It is in some people's eyes a meritorious mode of taxa- 
 tion to take large sums of money out of people's pockets 
 on earned or unearned incomes up to, in some cases, 
 seven or eight shillings in the £, but to put a duty 
 on imported grain which might possibly add a fraction 
 of a farthing to the price of a four-pound loaf (if com- 
 petition amongst our farmers did not indeed neutralise 
 that slight increase to some extent) is quite unthinkable. 
 The remarkable thing about it all is that if, during 
 war-time, as at present, the four-pound loaf goes up 
 
62 DANGERS OF ECONOMIC DEPENDENCE 
 
 from the previous price, 4d., to about lOc^., or even Is., 
 owing to the fact that free- import trade fallacies have 
 caused our land to be put, year by year, less under 
 grain, not the slightest protest is made. 
 
 Bounties on the grain grown in the United Kingdom 
 or on the land tilled in arable would involve, in practice, 
 great difficulty in administration, and would necessitate 
 the creation of a new department at much cost, and 
 containing many officials. There would also be the 
 danger of many abuses, real or imagined, such as, for 
 instance, the cry that the bounty on arable land had 
 simply tended to increase the rent charged the farmer 
 owing to the greater competition for farms. The 
 remedy some suggest for that, namely, the State 
 ownership of all the agricultural land in the country, 
 would be a socialistic experiment untried on such a 
 scale in any part of the world, and fraught with danger. 
 The relative advantages, as paying propositions of 
 large industrial farms, and also co-operative colonies 
 of small holders, if tested by the authorities to some 
 moderate extent would afford much useful information 
 for the best mode of dealing with vast areas of land 
 within the United Kingdom. We all know that before 
 us lies the great task of rebuilding the national economic 
 system on sure and sound foundations as the central 
 fulcrum of a great and independent Empire. The war 
 has aroused us to a higher sense of duty, not only to 
 one another, but to the State, and it seems evident 
 that we cannot look at these great questions any longer 
 from the narrow standpoint of one section of the 
 community, important as it may be, but that we must 
 regard them from the point of view of the greatest 
 benefit to the Commonwealth. 
 
BRITISH MAiNUFACTURIKG INDUSTRIES 63 
 
 If we turn our eyes from agriculture to the manu- 
 facturing industry, in which we were at one time facile 
 'princeps, what do we find is our position during normal 
 times of peace ? Take the cotton spinning industry, 
 for instance, for the benefit of which IVIr. Cobden and 
 his Rochdale friends invented free-import trade coute 
 que coute, which is still our leading manufacture. There 
 has not been any marked change in that industry 
 since the beginning of this century, so one may take 
 it that what Mr. Macara, President of the Master Cotton 
 Spinners' Federation, said in 1901 still holds good, that— 
 
 " in the last twenty-five years Great Britain's consump- 
 tion of American cotton only increased about 10 per 
 cent., whilst the world's consumption increased about 
 •250 per cent. During the great depression in England's 
 cotton industry, from 1892 to 1897, 4,000,000 spindles 
 were broken up. Whilst England practically remained 
 stationary, it is estimated there was an increase of 
 no fewer than 15,000,000 spindles abroad in the last 
 ten years." 
 
 If we cast our eyes to another very important 
 industry what do we find ? According to Sir Guilford 
 Molesworth : 
 
 "In 1878 the production of pig iron in Germany and 
 also in the United States was only about one-third of 
 that of Great Britain, in 1907 the production of pig 
 iron in Germany exceeded that of Great Britain by 
 about 25 per cent., and the production in the United 
 States exceeded that of Great Britain by 150 per cent. 
 Before the adoption of our present fiscal policy in the 
 forties, the trade and industries of Great Britain were, 
 of course, in a far more developed condition than those 
 of Germany and the United States, consequently a 
 
64 DANGERS OF ECONOMIC DEPENDENCE 
 
 relative comparison is not altogether conclusive, but 
 the progress in Germany and in the United States had 
 been altogether out of proportion to their initial and 
 final development, for according to the Cobdenite 
 doctrine they ought to have been ruined ; while 
 Bastiat insisted that if a country adopted Protection, 
 her ruin was assured ; moreover, the progress in the 
 protected countries has not only been relatively but 
 actually great." 
 
 Both Germany and the United States have surpassed 
 us in the production of iron, which is a most important 
 factor in the development of nearly all other industries. 
 Then in respect to the woollen trade. There was a 
 marked falling off at Bradford and elsewhere in the 
 United Kingdom when the McKinley tariff became 
 law, despite the fact that the manufacturers were told 
 that the McKinley protectionist tariff in the United 
 States would not hurt them because their volume of 
 trade with other countries would increase. This has 
 proved to be quite inaccurate. The only ray of light 
 which that industry has seen has been caused by the 
 generous action of the Canadian people in giving 
 preferential rates to woollen goods imported from the 
 United States to Canada. The silk trade, once a 
 flourishing industry in this country, has been ruined 
 by foreign competition, and other of our manufactures 
 such as glass, china, tools, machinery, linen, etc., are 
 hard hit for the same reason. 
 
 Space will not permit one to enter into fuller details 
 regarding all the British industries which have gradually 
 faded away in the last few years, the cause for their 
 decHne being mainly, though not exclusively, the 
 dumping of foreign goods (in some instances aided by 
 
TBE QLE&TION TO BE SOLVED 66 
 
 bounties) in our markets, so that, as a matter of fact, 
 the foreigner has had Protection in this country and 
 the full use of our markets, mainly supported by our 
 industrial classes, though this protection was denied 
 to British industry. 
 
 If people are to be induced to put money into great 
 metallurgical or other industries, it is needful to give 
 them definite assurance that neither they nor their 
 works will be jettisoned when the war is over, whether 
 steps are taken which are likely to offend the orthodox 
 disciples of a discredited school of political economy 
 or not. The country must make up its mind to one 
 of two things — either that it will adopt such measures 
 after the war as will secure ample employment for 
 British workers at good wages, and a restoration to 
 prosperity of many important and once flourishing 
 industries in our midst, such as glass, silk, tool-making, 
 and dye works, or that it will continue to sacrifice the 
 interests of the community to the present economic 
 system. Whether this is done by tariffs, or bounties, 
 or increased banking facilities, or by all three, is, of 
 course, the question to be considered, but those who 
 are inclined to invest their capital in restoring British 
 industry to its former supremacy will not do so unless 
 they are given reliable security for what they spend in 
 buildings, in plant, or other improvements. 
 
 If after the war capital for one reason or other is not 
 available — if, for instance, there is a lack of security 
 for the continuance of infant industries which may be 
 started — it will be a bad day for labour in this country, 
 as, owing to the large number of men who will return 
 to civil life at the termination of hostilities, the fact 
 that many older men have got temporary employment, 
 
66 DANGERS OF ECONOMIC DEPENDENCE 
 
 and the various ways in which female labour will 
 continue to be employed, there will then be a risk of 
 great congestion in the labour market. 
 
 The scales, it is hoped, have fallen from the eyes of 
 those who were blinded by the false prospects of peace 
 when there was no peace, and whose " spiritual home " 
 was outside the King's Dominions. We paid no heed 
 to the warning voice of the late Lord Roberts when he 
 urged us to organise our military forces for emergencies 
 which he said might arise, and which certainly have 
 since arisen. He strove to do his duty to the last, as 
 he had done it throughout his strenuous life, and, old 
 man as he was, he consecrated the last few years of a 
 noble life to his self-imposed task, alas, in vain ! Had 
 we done what he advised, had we been prepared before 
 the summer of 1914, the peace of the world might have 
 been still maintained. 
 
 It is our duty now to set our economic house in order 
 whilst we have yet time. We must be prepared for 
 the economic contest ahead of us, and we should take 
 warning from the past. This point was cogently 
 enforced by the Prime Minister of Australia during 
 his recent stay in this country : 
 
 " The least we can say of the Navy is that it has 
 saved Britain," he said. " But the truth is that it 
 has saved the civilised world. Behind that impreg- 
 nable wall of triple steel we have opportunity to 
 remedy in some fashion our lack of preparation. But 
 is there a man amongst us who does not pale as he 
 looks back and sees the awful gulf which he has missed 
 by a hair's breadth ? Is there one who does not 
 rejoice that there were men amongst us who shut their 
 ears to the cries for a smaller Navy ? " 
 
CHAPTER IV 
 
 IMPERIAL UNITY 
 
 ** If called upon to declare what circumstance in the condition of 
 England which, more than all other things, makes her the envy of 
 surrounding nations, it would be to her colonial possessions that we 
 must attribute that feeling. In the eyes of foreigners, those pos- 
 sessions are at once the evidence of our power, and the surest indicant 
 of its increase." — Mr. Porteb, Progress of the Nations. 
 
 Part I 
 
 Our aim undoubtedly should be to have the largest 
 interchange of commodities with, the people of the 
 British Empire, and to encourage favourably trade 
 relations with those nations of the world who are our 
 AlHes and friends in order to add to their and our 
 material strength by increasing the prosperity of all. 
 The great question which must be solved before long 
 is that of mutual co-operation and support amongst 
 the peoples comprised in the British Empire, not only 
 for national greatness, but also for material success. 
 All of us, from the northern bounds of Canada to the 
 tropical regions in the southern Pacific, from Hong- 
 Kong to Honduras, have matters of common interest. 
 These chiefly relate to our defence, to our intercom- 
 munication by shipping, to our trade relations and 
 finance, together with many important laws which we 
 might make more uniform and more effective in order 
 
 67 
 
68 IMPERIAL UNITY 
 
 to protect our own interests, especially those concerned 
 with navigation and commerce. 
 
 To carry this out we require an Imperial Repre- 
 sentative Council with certain defined powers to safe- 
 guard both our internal and external interests. We 
 find in this twentieth century that other peoples are 
 too highly organised and too thoroughly prepared for 
 all emergencies to permit of our continuing the old 
 policy of laissez faire. 
 
 We must not forget, in making an appeal for unity 
 within the Empire, and reciprocal preference in trade 
 matters, that the Dominions have come to our aid not 
 only with brave men, but also with food. When the 
 Americans were trying to force up our prices Canadians 
 were trying to keep them down in our fa'vour. Canada 
 presented us with a large quantity of flour. Australia 
 offered to sell everything to this country and to nobodj^ 
 else, whilst New Zealand, the West Indies, Mauritius, 
 Singapore, Hong-Kong, and other Colonies followed a 
 similar policy. How, too, shall we speak of or suffi- 
 ciently recognise the gallantry of the chiefs and the 
 soldiers both from the British and native States of the 
 great Empire of India, and their noble gifts, or, last 
 but not least, of the brave loyalty of General Botha, 
 General Smuts, and the men they led so well to victory 
 in defence of their flag and ours ? 
 
 We must remember that Great Britain cannot again 
 look at this question solely through the spectacles of 
 one of the parties in the State, nor even the nation 
 itself : she must henceforth regard it from an Imperial 
 standpoint. Freedom from economic pressure on the 
 part of Germany or any other Power means strength 
 to the Mother Country, therefore in considering these 
 
THE PARTING OF TWO WAYS 69 
 
 questions we must meet our fellow-citizens from beyond 
 the seas not as strangers, but as comrades and brothers, 
 and join all our forces to the comm_on advantage. If 
 we refuse to do so we shall remain economically de- 
 fenceless and weak. Canada has again and again been 
 approached in regard to joining economic forces with 
 the United States, the most recent effort being that of 
 191 1, but she has declined all such offers from whatever 
 quarter they may have come. These offers may come 
 to many other parts of the Empire, which may be 
 tempted to look elsewhere for some reciprocal terms 
 of commercial union if we refuse this great opportunity. 
 The point to be remembered is this, that Great Britain 
 cannot supply herself with raw materials. If she takes 
 them from the members of her own familj' and her own 
 Empire she will be strong. 
 
 We are now at the parting of two ways, and can 
 one doubt that in the United Kingdom statesmen of 
 all parties v. ill follow the right path, and, as British 
 Nationalists, make the interests of the Mother Countr}^ 
 of the sturdy Dominions, and of India more thor- 
 oughly one ? A resolution in this sense was passed 
 last year b}^ the leading commercial men of the 
 United Kingdom at the gathering of the Associated 
 Chambers of Commerce when they resolved that — 
 
 " with the object of maintaining an increase in our 
 trade after the conclusion of the war it is necessary 
 that the different parts of the Empire be drawn into 
 commercial union and that provision should be made 
 for reciprocal preferential trading relations between 
 all parts of the British Empire." 
 
 The resources of Great Britain, though large, are 
 limited ; those of the Empire as a whole are bound- 
 
70 IMPERIAL UNITY 
 
 less, and when thoroughly developed will place us in 
 a position of great economic strength. They should 
 be developed as rapidly as possible, and the best and 
 most efficient way to carry this out would be by care- 
 fully considering a plan of Imperial preferential tariffs. 
 In truth, a carefully considered scheme of business 
 management in the Imperial interests is essential to 
 the continuity of the British Empire as a force in the 
 defence of the human race, therefore we cannot allow 
 a policy of drift to still continue. The united Do- 
 minions of the Crown stand for self-government, and 
 mutual responsibility between the Government and 
 the governed, the latter being more developed in some 
 parts of the Empire than in others. They stand for 
 the interests of peace, justice, and liberty throughout 
 the civilised world. 
 
 What the basis of representation should be and how 
 the teeming population of India should be represented 
 are all matters of detail. The case of India requires 
 careful consideration, and could as a matter of fact be 
 met by giving to the people of that country some 
 definite, though it may be, at first, indirect share of 
 the Imperial Administration. That would be a 
 legitimate concession to the spirit of the races of 
 India, who have so nobly fought for the Empire of 
 which they form an important part. Though their 
 institutions and languages may differ, sentiments of 
 loyalty, ties of good feehng towards England, together 
 with a determination not to be placed under the 
 dominance of a foreign yoke would bind them to the 
 United Kingdom, which to a good many of them is 
 the Mother Country, and which they all know would 
 do her best to defend them if occasion should arise. 
 
THE CONSTITUTIONAL PROBLEM 71 
 
 They have, in fact, all loyally resolved to rally round 
 the flag in times of stress and danger. 
 
 What would Great Britain do without her wide- 
 spread Dominions ? If the latter were captured by a 
 foreign Power the carrying trade to them would be 
 transferred to the ships of that Power, and the im- 
 position of preferential tariffs against Great Britain 
 would complete her isolation from the lands to 
 which her sons have gone, her maritime supremacy 
 would pass, her commercial decadence would com- 
 mence, and the sceptre of empire would fall from her 
 hands. 
 
 No doubt Imperial conferences are called together 
 from time to time, but their working lacks continuity, 
 and is relatively of less importance than the gravity 
 of the subjects they consider and the valuable resolu- 
 tions they arrive at. What we require is continuous 
 consideration of matters that have hitherto been 
 considered of general Importance to the United King- 
 dom as well as of others which the march of events 
 brings to the front. 
 
 The question of framing a new constitution to meet 
 the altered circumstances of the case has been grasped 
 within the last thirty or forty years in the case of 
 Japan, where a small committee of the senior states- 
 men, such as Ito and others, were appointed to ex- 
 amine into all the constitutions of the various States 
 of the world. This they did, and a Constitution was 
 framed by the Emperor of Japan and his advisers. 
 Since its passing this Constitution has only required 
 slight modifications. It has survived the trials of 
 great wars and times of industrial depression, and has 
 not been found wanting. Under its guidance the 
 7 
 
72 IMPERIAL UNITY 
 
 great council of the nation has been able to steer the 
 Ship of State safely through many troubled seas. 
 
 It must be remembered that at present, so far as 
 we are concerned in the United Kingdom, the Do- 
 minions occupy the position of foreign countries, and 
 that equally applies to their position to one another. 
 In regard to maritime law some of them occupy the 
 position of maritime Powers, for they have the power 
 to make and enforce maritime laws of their own for 
 their own shipping, and even, within limits, to impose 
 these laws on the ships of the Mother Country. Of 
 course, when the Mother Country gave the power of 
 fiscal autonomy to the Colonies, the idea was that by 
 it they could raise revenue ; it was never contem- 
 plated that it would grow into a system of protection 
 even against the products of the United Kingdom. 
 The fact that we have granted to the Dominions the 
 right to impose custom dues would place us under a 
 very serious disadvantage in future in making reci- 
 procal trade arrangements with the Dominions unless 
 we framed and passed a general tariff and resumed 
 our bargaining power in that respect. 
 
 It is satisfactory to notice that, whatever the Mother 
 Country is doing, our great colonial dependencies are 
 looking ahead, and determining to make preparations 
 for the condition of affairs which will probably result 
 at the termination of hostilities. Sir Charles Foster 
 explained last year certain work which the Canadian 
 Department of Trade and Commerce proposed to do 
 at once to cope with conditions which will arise after 
 the war and in consequence of it, and with the need 
 of preparation for the return of our soldiers and the 
 consequent diversion of labour and capital from the 
 
URGENCY OF A NATIONAL POLICY 73 
 
 manufacture of munitions to other industries. He 
 further stated that the Canadian Government pro- 
 posed sending commissioners to the countries of the 
 AlKes to study the nevv^ trade operations of those 
 countries, and to establish in Canada a bureau of 
 commercial information where statistics of the natural 
 and industrial resources of the Dominions could be 
 obtained, in connection with which there would also 
 be exhibits of the processes of their manufacture. 
 
 The Australian Prime Minister, Mr. Hughes, in 
 speaking at a dinner given to him at the House of 
 Commons in April 1916, by the Parliamentary Labour 
 Party and other Labour organisations, said : 
 
 " The Australians have not stopped at military pre- 
 parations against Germany, they have waged also \\dth 
 all the power at their disposal against that country 
 an economic war," 
 
 and added : 
 
 " Having freed ourselves from the octopus grip of 
 our enemy we ought without delay to lay the founda- 
 tions of a great national pohcy worthy of our race, 
 and of a truly civilised people." 
 
 There is no doubt that we in Great Britain ought 
 also to lay the foundations of a national policy worthy 
 of our country. There are three reasons certainly 
 why we should do so : for our national safety, to 
 serve and expound our trade and industry, and in 
 order to give to all willing workers employment and 
 such adequate remuneration as will keep them in 
 reasonable comfort. We can only do so if we are 
 
74 IMPERIAL UNITY 
 
 resolved to build up our industries in such a way as 
 to prevent them from being dependent after the war 
 for their raw material and supplies in countries out- 
 side the Empire, nor must we again be placed in the 
 same position that we were in at the beginning of 
 August 1914, when we found, amongst other things, 
 that tungsten powder used for hardening steel was a 
 monopoly of the Germans, although we possess the 
 raw material from which it is manufactured — namely, 
 wolfram — ^in Cornwall. This product was, of course, 
 required for munitions of war, and the Government 
 had at first to purchase it through a German agency, 
 which, needless to say, made them pay accordingly. 
 
 It is difficult to believe that Canada and Australia, 
 who have contributed so much to the war, will be 
 content hereafter without some power of direction in 
 the affairs of the Empire, and they doubtless will wish 
 to see that their interests are watched by broad- 
 minded and experienced statesmen from their own 
 Dominions sitting alongside of their British confreres. 
 This fact will have to be faced. 
 
 You may call any consultative body which will be 
 framed for this purpose what you please, and make 
 its powers as expansive or as restricted as if found 
 practical, but there is no doubt that Imperial Federa- 
 tion must take some tangible form within the Empire 
 at no very distant date. When we consider the many 
 important subjects which will have to be solved, such 
 as the United Navy question, inter-Imperial trade, a 
 common standard of weights and measures, questions 
 relating to coinage and postage, we shall see that our 
 future Imperial trade policy will be the fundamental 
 question to be considered. What made the poUtical 
 
A COUNCIL OF THE UNITED EMPIRE 75 
 
 union of South Africa possible was the customs union 
 that preceded it. The economic welding of the German 
 States was the stepping-stone to the German Empire. 
 We must therefore make the foundation strong before 
 we commence the superstructure. Economic rela- 
 tions are the foundation of political relations in the 
 same way as trade with other nations is the basis of 
 our relations mth them. 
 
 *' We, the Canadians," said Mr. Richard Reid, 
 Agent-General for Ontario, in a speech which he de- 
 livered last year, "are bound to the Motherland by 
 the silver cord of sentiment, but at the close of the 
 war we hope there will be something more tangible. 
 We are now a part of the Empire, but we want to feel 
 that we have a deeper interest in its development." 
 
 In altering our present somewhat happy-go-lucky 
 system of Imperial defence and inter-Imperial trade 
 relations, to meet the exigencies of the present day, 
 we must remember that what we did in the days of 
 the Empire's youth will not suit its coming period of 
 adolescence. The circumstances of the world are 
 changed, and, as Mr. Deakin warned us, " if the world 
 moves and we stand still we none the less by our in- 
 action take the responsibility by a decisive course." 
 On the one hand there appears to be some mistake in 
 the minds of some people who invariably consider that 
 the foreign policy of any future Imperial Government 
 should be under the control of some Imperial Council, 
 but that is not our constitutional mode of dealing 
 with foreign affairs, and is rather more in accordance 
 with the practice in America, where all foreign matters 
 are discussed by the Senate. We, on the other hand, 
 
76 IMPERIAL UNITY 
 
 leave such matters solely to the Executive. Of 
 course, the British Parliament has the right of dis- 
 cussing affairs relating to the Foreign Office and its 
 policy on the votes in supply, but as a rule that right 
 is used sparingly and with discretion. 
 
 There is no lack of recognition in the United King- 
 dom of the patriotic action of the British Dominions 
 during this war. Many of our statesmen have pointed 
 this out in eloquent periods in Parliament and else- 
 where. Mr. Runciman in one of his speeches in the 
 House of Commons mentioned the self-sacrifice which 
 several of the Dominions had shown in sending us 
 their products and refusing, even at a loss, to sell them 
 to neutral States. Surely he will not forget that we 
 owe some debt of gratitude to them for so doing, and 
 we should show it in some practical form at no very 
 distant date. 
 
 No Dominion would co-operate more whole-heartedly 
 with the British Empire or come more willingly into 
 friendly trade relations with our Allies than India. 
 That country has been subjected to a long-drawn-out 
 and cruel calculated action on the part of Germany, 
 who has made a premeditated attack on several of its 
 native industries. To mention one, which by this 
 method had been practically destroyed before the war, 
 namely, indigo. The attack on this industry was 
 accomplished by means of the highly subsidised com- 
 petition of the Badische Anilin Fabrik Company in 
 selling for years, at a loss, inferior synthetic dye below 
 cost price in order to kill the production at a profit 
 of the superior natural Indian indigo. Having suc- 
 ceeded by this panther-like mode of attack in the 
 destruction of their victim (who was helpless to repel 
 
UNION iVIEANS STRENGTH 77 
 
 their insidious attacks by placing an import tariff on 
 this German production against which the Manchester 
 School of Political Economists in Great Britain would 
 have held up their hands in horror), they effected the 
 ruin of this important, and, at one time, flourishing 
 industry in India. They then adopted their usual 
 practice, and put up the prices of their synthetic 
 dye, making, of course, large profits, and following 
 the same tactics there as they do by their dumping 
 system in attacking and destroying British industries 
 at home. 
 
 If Great Britain recovered her bargahiing power by 
 means of a tariff, and it ended in mutual preferentia.1 
 arrangements within the Empire, does anyone imagine 
 that Germany would continue to penalise the importa- 
 tion of British or Colonial produce within her borders ? 
 Moreover, it is said, after the war she proposes to further 
 classify and prohibit our merchandise by the imposition 
 of higher import duties. If the British Empire were 
 in a position to say they would not have it, and would 
 retaliate if it were done, the German people would 
 pause ere they thus jeopardised their trade with the 
 British Empire, which amounted in value before this 
 war to half oi the total of German exports. 
 
 The idea of Great Britain passing a General Tariff 
 Law has been in the mind of Colonial statesmen for 
 years past. Sir Samuel Griffiths, Premier of Queens- 
 land, said in 1887 : 
 
 " Individual action by each part of the Empire 
 should in this matter yield to the good of the whole. 
 If for any reason it decided to impose custom charges 
 on goods imported from abroad it should be definitely 
 arranged that goods coming from the Mother Country 
 
78 IMPERIAL UNITY 
 
 or from British Possessions should be subject to a 
 lighter duty than from foreign countries." 
 
 Of course Canada, as is well known, makes a re- 
 duction in favour of the United Kingdom in her 
 customs tariff of one-third of the total amount of the 
 dues to be paid. Australia, New Zealand, and South 
 Africa give also preferential and discriminating ad- 
 vantages to goods arriving from the United Kingdom. 
 The consolidation of the Empire is promoted by 
 patriotism, by the preservation of British institutions, 
 by bonds of mutual interest, by preferential treatment 
 which will be mutually advantageous, and, at the same 
 time, by maintaining the autonomy of each unit as to 
 its fiscal regulations. The oversea Dominions have 
 adopted our methods in a great man}^ important 
 directions, but no patriotic wish to assimilate our 
 customs has caused any self-governing Colonj^- or 
 Dependency to adopt our Utopian system, or our 
 method of free-import trade. Our so-called Imperial 
 Parliament does not deal with Imperial questions as 
 often and as frequently as their great importance 
 requires, and M. Merinee, in his Impressions of England^ 
 refers with regret to the littleness of English politics 
 of our own times. 
 
 The views of a united British Empire in this matter 
 of the trade of the world are of very great importance. 
 Our country is the senior partner in the great firm 
 of the Allies because the British Empire controls 
 nearly one-third of the international trade of the 
 world. As yet we have had no sign of what our future 
 policy is likely to be. In the course of a debate in the 
 House of Commons last year on questions affecting 
 
THE EVOLUTION OF A CONSTITUTION 79 
 
 this vital subject, the then President of the Board of 
 Trade told the Members and the country what Australia 
 a ad other Colonies are willing and ready to do in order 
 to meet our views and the requirements of these times, 
 but he did not tell us what we are read}^ to do as a 
 nation to meet their views. The public mind is, how- 
 ever, somewhat plastic now, and we can look at things 
 in their true light, discarding a host of trivialities, and 
 consider questions of fundamental importance only. 
 
 Numerous plans have been suggested by men of 
 light and leading to effect a closer and more practical 
 union of the Empire than we have at present . In these 
 pages there is no intention or wish to discuss their 
 feasibility or the reverse, nor to venture to suggest 
 any cut-and-dried scheme to carry out what is called 
 Imperial Federation. That can only be evolved by 
 the ripe experience of statesmen from all parts of the 
 world after due consultation and consideration. If 
 a Royal Commission or Council were appointed to 
 formulate some definite constitutional union for certain 
 general or Imperial purposes within the Empire, that 
 body might be made up, as was suggested by the writer 
 in a speech delivered at the Royal Colonial Institute 
 last March during the course of a debate which followed 
 an interesting paper by Mr. B. H. Morgan, as follows : 
 As a beginning we might have a Council of twenty — 
 ten appointed by the Mother Country, five of whom 
 should represent the Empire of India and the Crown 
 Colonies, and the other ten elected by the various 
 autonomous Colonies of the Empire. 
 
 The following remarks by Mr. Kerry Nicholls appear 
 much to the point. Speaking in the course of a dis- 
 cussion at the Roj^al Colonial Institute, he said, after 
 
80 IMPERIAL UNITY 
 
 describing England's Colonical possessions as bidding 
 fair to outrival the Mother Country in population and 
 greatness : 
 
 " Although the Colonies were called dependencies of 
 the Crown, it must be conceded that there was very- 
 little spirit of dependence amongst the colonists them- 
 selves. Responsible government, the sentiment of 
 nationality which had sprung up with it, and other 
 causes, had taught them to know their political and 
 material strength and importance ; and whilst he 
 believed they would hail with readiness, nay even with 
 pride, any form of Imperial Federation in which their 
 interests w^ould be fairly represented, he was sure they 
 would stand firmly aloof from any scheme of Imperial 
 Federation in which they could not enjoy relatively 
 the same privilege with ourselves. The colonists, 
 mindful of the important position they had acquired 
 for themselves in the world, would be apt to look upon 
 Imperial Federation in a very matter-of-fact way. 
 They would say, ciii bono ? and if arguing the point 
 with the Mother Country they might justly add, ' You 
 gave birth to us, you nursed us when in our swaddling 
 clothes, you sent us to school in our own parliaments to 
 learn how to govern ourselves ; and now that we have 
 attained our majority and are likely to cut a big figure 
 in the world, you talk about Imperial Federation, and 
 ask us to enter into a bond of eternal fellowship.' 
 Recognising, as we must, the great political and com- 
 mercial eminence to which the Colonies had attained, 
 it seemed clear to his mind that any form of Imperial 
 Federation must be based upon measures of equality, 
 and assimilated as near as possible to our present 
 constitution and form of government. In other words, 
 if we invited the Colonies to enter into an Imperial 
 Federation, we must meet them as nearly as circum- 
 stances would allow upon an equal footing, and extend 
 
OUR POSITION IN 1837 AND NOW 81 
 
 to them relatively the same constitutional privileges 
 with ourselves. We could not at this late stage say to 
 the Colonies, ' You shall do this,' nor could the Colonies 
 say to us, ' You shall do the other.' There must be an 
 equal, voluntary, and conjoint action on the part of the 
 Mother Country and the Colonies, and community of 
 commercial interest in time of peace, and a firm and 
 united action in time of war, must form the principal 
 links in the great bond of union." 
 
 When Queen Victoria first began to reign the Colonial 
 Empire consisted of twenty-four colonies and settle- 
 ments, having amongst them a population of only 
 four millions. Their exports and imports were about 
 thirty milHons sterling. This, of course, does not in- 
 clude the Empire of India, then under the direct rule 
 of the Honourable East India Company. Now, in- 
 cluding India, their aggregate population comprises 
 more than 315 million people, and their total trade 
 in 1911 exceeded £958,000,000 sterling in value. This 
 is a very large increase indeed, and these colonies 
 hold a vastly different position in the world-system 
 from what they did twenty years ago, one to which, at 
 length, we appear to have thoroughly awakened of 
 late. Our Dominions are growing apace, and they 
 may prove to be sturdy sons of a sturdy race, in fact 
 great and prosperous nations with more abundant 
 wealth and a larger population than the land from 
 which they sprung can boast. 
 
 It has not been in the past, nor should it be now, 
 the privilege of any one party in the State to strive to 
 unite us to our colonies in community of interest and 
 bonds of friendship ; it should he the aim of all parties. 
 We have been partners in a common enterprise menaced 
 
82 IIVIPERIAL UNITY 
 
 by a common danger ; since August 1914 we have 
 been bound together in the purifying fires that test 
 the heart and character, and we may hope that after 
 the war we shall be more thoroughly at one than we 
 were before it broke out. 
 
 One cannot more fittingly conclude the first part of 
 this brief resume of the permanent methods of Imperial 
 cohesion, which is desired by all the peoples of the 
 Empire both in spirit and in truth, than by venturing 
 to quote the gracious words sent by His Majesty the 
 King to Sir Douglas Haig, G.C.B., Commander-in- 
 Chief of the British Expeditionary Forces in France 
 on Empire Day last year : 
 
 " May the comradeship of the battlefield knit still 
 closer together the people of the Dominions and of the 
 Mother Country in the age of peace which, please God, 
 will be the fruit of this long and arduous war." 
 
 Part II 
 
 One of the chief objects to be attained in furthering 
 the consolidation of the Empire is to link it together 
 in a well-thought-out scheme for its mutual defence, 
 to ensure that the trade relations should be mutually 
 and reciprocal!}^ beneficial to each part, and to estab- 
 lish a central intelligence department which shall 
 collect and distribute information regarding the 
 sources of supply of the natural and manufactured 
 products and the requirements of the Mother Country 
 and each Dominion. It would also seem desirable 
 that efforts should be made to unify our shipping and 
 navigation laws. The sea unites the Empire by its 
 trade routes, whilst it separates its component parts 
 
ONE KING, ONE FLAG, ONE NAVY 83 
 
 geographically from its centre. Had the British Navy 
 not had control of sea power for the last two years, 
 and had it not been for the efficiency and preparedness 
 of the Grand Fleet, there is no doubt that many of 
 the largest and most important cities along the trade 
 routes on the coastlines of the Empire would now be 
 a mass of ruins, and their population autocratically 
 controlled and held up to enormous indemnities. We 
 have already a Navy adequate to police the trade 
 routes of the world, as we have done for the past 
 hundred years or more, and for the purposes of war. 
 As is now the case, the Imperial Navy should always 
 be directly responsible to and controlled by the 
 Admiralty at Whitehall, whilst each unit of the 
 Empire might in time of peace have its own local 
 naval force under its own administration to become 
 part of the Imperial Navy under central control in 
 time of war, as is also at present the case. Logically 
 the whole expense of defending the Empire at sea 
 should not fall solely on the inhabitants of the United 
 Kingdom, though it would seem right that they 
 should bear the lion's share of that cost ; but there 
 should be an equitable co-operation on certain definite 
 lines voluntarily agreed upon by each part of the 
 United Empire. Of the willingness of all the Do- 
 minions to agree to this fair arrangement after careful 
 consideration one can entertain no doubt ; in fact, 
 it has been to a great extent carried out by several of 
 them already, and also advocated by many of their 
 leading statesmen and citizens. It is a great Imperial 
 duty to render the coast-lines of the whole inviolate, 
 and to guard the trade routes so essential to the life 
 of the Empire. 
 
84 IMPERIAL UNITY 
 
 There should be an " all red " cable service to e very- 
 part of the United Kingdom, and whilst in the House 
 of Commons the present writer spoke on more than 
 one occasion in support of that scheme which would 
 bring every part of the Empire in touch with the other, 
 making it independent of foreign-owned cables and 
 self-contained during times of war as well as during 
 times of peace. At present, it appears, Canada and 
 other Dominions have acquired the power, or it has 
 not, in fact, been denied them, of making treaties in 
 regard to their commercial and tariff arrangements 
 with each other and with foreign Powers. It is evi- 
 dent that care should be taken that no treaty such 
 as we had at one time with Belgium should be made 
 by any part of the Empire which would preclude it 
 from giving preferential tariff rates, if it so wished, 
 to any other part of the whole, but those points, im- 
 portant as they are, are not so vital as that of our sea 
 power. On that the future of the British Empire 
 rests, and all other subjects pale before it. 
 
 It is more than a decade since the German Emperor 
 uttered those famous words " Germany's future is on 
 the water." We see in the light of present events 
 that these words were not merely an idle boast, and 
 that he was in deadly earnest when he uttered them. 
 He meant that it was necessary that his country 
 should possess a Navy capable of holding the seas, if 
 possible, against the Navy of Great Britain, and that 
 a merchant fleet should al^o be possessed by Germany 
 which should be able to make a fair bid for Britain's 
 maritime supremacy. Regarding the former, the 
 German warships have failed, and except for a short 
 raid or two have had to seek security inside the 
 
STATE AID TO GERIVIAN SHIPPING 85 
 
 harbours of Kiel or Heligoland. Respecting our 
 mercantile marine it is our duty now to see, before 
 hostilities cease, that they are not handicapped by any 
 attack on their present strength, which is according to 
 the last returns about twenty-one milUons gross ton- 
 nage out of the total tonnage of forty-six millions of the 
 world's mercantile marine, or nearly half. It is true 
 so far as numbers and also the construction of ships 
 are concerned, that our mercantile marine has no 
 superior in the world, and the history of the war has 
 amply vindicated the claim of British seamen to be 
 worthy sons of their ancestors ; but there are other 
 features of a much less pleasing character, for it is a 
 fact that prior to the war this great maritime nation, 
 boasting resources far superior to those of its German 
 competitors, was unable to compete with them for the 
 trade of certain ports of the world, including some 
 British possessions. 
 
 Some of our big lines have been driven to make 
 compacts with their competitors. One may well ask 
 why even the Cunard Line, whose position should be 
 impregnable, had to dip its flag to Herr Ballin. These 
 surrenders were due to the difference in the respective 
 positions of the German and British shipping com- 
 panies. Whilst the latter were left almost entirely 
 to their own resources, German shipping had the 
 whole of their Treasury at their backs. It is well 
 known that whenever a German shipping line could 
 prove that, backed by subsidies, it could take away 
 trade from the shipping of the United Kingdom, how- 
 ever indefensible as a commercial proposition the 
 venture might be, financial help was never wanting. 
 This gigantic plan of State socialism has been carried 
 
86 IMPERIAL UNITY 
 
 out to further a well-calculated scheme for making 
 Germany the dominant naval shipping and industrial 
 power of the world, and to that end they cared not at 
 all whether for years, or even a decade, they were 
 subsidising lines at a heavy loss to their exchequer. 
 By this plan they carried away to Hamburg and 
 Bremen the produce of the East and West African 
 Crown Colonies, in the former case as much as eighty 
 per cent, and in the latter sixty-one per cent. Unaided 
 by State subsidies this could never have been done, but 
 our lines were in the position of private traders fight- 
 ing against a practically inexhaustible capital poured 
 forth, regardless of loss, in support of a thoroughly 
 considered scheme of trade conquest. It is hard to 
 believe the fact, which is, however, absolutely true, 
 that prior to the war German lines were able to pre- 
 vent any vessel under the British flag from loading at 
 any port between Hamburg and Bordeaux for Aus- 
 tralia ! These were the terms on which the Ball in 
 Combination compelled our lines to trade. 
 
 Similarly aided by State subsidies, the German 
 Kosmos Line used to come into the Thames to take 
 goods to Chili. What a change from the days of the 
 Navigation Laws, which passed out of existence in 
 1849, expiring as it were with the birth of free-import 
 trade 1 A clause in the Navigation Act passed in 
 Cromwell's time enacted that the ship should be the 
 genuine property of a British subject, or, to quote the 
 exact words : 
 
 " In those ships alone are goods allowed to be trans- 
 ported into this Commonwealth of England or into 
 Ireland or any other lands, islands, plantations or 
 territories of this Commonwealth belonging or in their 
 
IMPORTANCE OF OCR MERCHANT SERVICE 87 
 
 possession or in any other ship or ships, vessel or 
 vessels whatsoever, but only in such as do truly and 
 iviihout fraud belong to the people of this Common- 
 wealth." 
 
 We have held the premier position as the great 
 maritime Power, and as the chief ocean-carrying traders 
 of the world since we took that position over from 
 the Dutch in the seventeenth century, and if we mean 
 to hold it we must spare no effort to build more mer- 
 cantile ships to replace any we have lost during this 
 war, while taking at the same time other steps to safe- 
 guard the supremacy of the seas in order that, at least 
 in every British port throughout the world, any 
 attempt to wrest our position as the first maritime 
 Power from us by means of subsidies to foreign ship- 
 ping, or other device, shall be thoroughly defeated. 
 
 So far as one can see, no one until recently cared 
 at all where the trade of the Empire came from or 
 went to, or who carried it from one part to the other, 
 least of all the Colonial Office. It was like a mighty 
 stream, with tributaries in every part of the British 
 Empire, bringing wealth and prosperity to Germany 
 in order that the latter might have ample wealth to 
 prepare for " the Day," to let loose her myriads of 
 trained troops and utilise her vast stores of arma- 
 ments and endeavour to drive from the seas the 
 mercantile marine of Great Britain and her Allies, 
 vanquishing their navies and enabling Germany to 
 dominate the universe. 
 
 In a report dealing with bounties and subsidies in 
 
 respect to shipping, shipbuilding, and navigation issued 
 
 by the Foreign Office in 1913, one finds shipping 
 
 bounties on the construction of ships and their running 
 
 8 
 
88 IMPERIAL UNITY 
 
 given by various countries. With regard to the Ger- 
 man Empire these bounties do not take the form of 
 a premium on the construction of ships, but consist of 
 special custom facilities for goods destined for use in 
 shipbuilding yards, and preferential railway rates on 
 shipments. As the duties charged in the German 
 tariff are very high, the remission of these custom dues 
 on material for shipping must have greatly aided the 
 German shipbuilders, and it is a matter of some 
 doubt whether we have quite got to the bottom of all 
 the bounties they actually did receive. 
 
 Regarding the bounties granted on railway rates 
 the facts stated in this report are as follows : Two 
 German steamship companies, viz. the German East 
 Africa Line of Hamburg and the German Levant 
 Line of Hamburg, receive assistance from the State 
 in another form which is equivalent to an indirect 
 bounty. This assistance is given by granting largely 
 reduced rates of carriage by all German State rail- 
 ways to goods exported from inland places of 
 German}^, on through bills of lading, either to East 
 Africa or to the Levant respectively, by the German 
 East Africa Line or the German Levant Line steamers. 
 The railway portions of these combined land and 
 fcea through rates of freight, which were introduced 
 for the Levant Line on June 15th, 1890, and for the 
 East Africa Line on April 1st, 1895, are understood 
 to be much lower than those in force for goods sent 
 to German ports for direct exportation by sea. 
 
 The rates of the Levant Line Tariff are based 
 upon the arrangement made by this company with 
 the German Government for carrying German exports 
 from the interior of Germany to all parts of the Levant 
 
COAST-LINE OF THE ENTENTE POWERS 89 
 
 (excepting Tunis and Tripoli), including Malta, Alex- 
 andria, the Piraeus, Smyrna, all important ports of 
 Turkey, Bulgaria, Roumania (and various stations of 
 the Turkish and Bulgarian railways), and all ports of 
 the Black Sea. Besides being favoured by the reduced 
 sea freights of the Levant Line and on the German 
 State railways, goods sent by this company's steamers 
 on through bills of lading profit also by reduced rates 
 of carriage on the Turkish and Bulgarian lines, if they 
 are destined for stations thereon. It will be seen by 
 the above that the German Government prior to 1913, 
 by this process of " peaceful penetration," obtained 
 preferences on the transit charges of their goods in the 
 countries of their present willing or unwilling Allies — 
 Turkey and Bulgaria. 
 
 If you examine the coast-line of Great Britain and 
 the countries of her Allies you will find that they have 
 a preponderating share of the chief ports and harbours 
 of the world. That fact should give us food for much 
 reflection. At a meeting of the Empire Parliamentary 
 Association held at the House of Commons this summer 
 to consider various matters regarding the welfare of 
 the Empire generally, which was attended by a large 
 number of men who took an interest in those matters 
 in the United Kingdom, including peers. Members of 
 Parliament, etc., and a goodly number of leading 
 Ministers and statesmen of the various Dominions, 
 Sir Charles Foster gave a very instructive and lucid 
 address on "Trade and Commerce after the War." 
 A debate ensued in which many of the members of the 
 Conference took part, and during the course of it the 
 present writer ventured to offer a suggestion to the 
 Conference which may be here briefly recapitulated. 
 
90 IMPERIAL UNITY 
 
 Before this is done reference should be made to the 
 fact that whilst this war has been proceeding those 
 few German warships that for a time escaped the 
 vigilance of our Navy have made a rule unto them- 
 selves in defying all precedents of civilised naval 
 warfare. Cruisers and submarines of this German 
 mushroom navy have sunk at sight passenger liners 
 such as the Lusitania, the Falaba, also even hospital 
 ships as well as fishing vessels without number, and 
 their crimes also include the recent murder of Captain 
 Fryatt, who did his duty as a British captain should 
 in defending his vessel the Brussels. 
 
 The suggestion put before the Conference previously 
 referred to was that in order to " make the punishment 
 fit the crime," during the reconstruction period after 
 the war, with the consent of the British Dominions and 
 the Empire of India, we should charge within the 
 Empire an additional port due in the nature of a surtax 
 on the tonnage of any German mercantile vessel on its 
 being allowed to enter any port, harbour, or dock in 
 any part of the Empire. If all the Allies acted in the 
 same way, as they probably w^ould, the penalty would 
 be a more effective punishment for the enemies' 
 breach of international law at sea, and a more effective 
 mode of preventing its repetition, than diplomatic 
 " notes " and similar protests. 
 
 In regard to the murder previously alluded to, 
 Mr. Balfour said last August, in touching upon various 
 subjects relating to the fleet : 
 
 " Doubtless it is their wrath at the skill and energy 
 with which British merchant captains and British 
 crews have defended the lives and property under 
 their charge that has driven the German Admiralty 
 
SPONTANEOUS LOYALTY OF THE EMPIRE 91 
 
 into their latest and stupidest act of calculated ferocity 
 — the judicial murder of Captain Fryatt. What 
 blunderers they are ! I doubt not their ability to 
 manipulate machines, but of managing men, unless it 
 be German men, they know less than nothing. They 
 are always wrong, and they are Avrong because they 
 always suppose that if they behave like brutes they 
 can cow their enemies into behaving like cowards. 
 Small is their knowledge of our merchant seamen." 
 
 Yes, as Mr. Balfour said, " What blunderers they 
 are ! " Surely some amongst the leading men of this 
 Germanic race, not absolutely saturated with the 
 Nebuchadnezzar-like exaltation so conspicuous in 
 high quarters, must have known that the various pin- 
 pricks they have from time to time given us both by 
 sea and land, such as murdering civilians at Scar- 
 borough and elsewhere in Great Britain, have only 
 roused our people to rally to the flag, to work in the 
 munition factory or the shipbuilding yard. 
 
 Again, they blundered about the result of their 
 throwing down the gage of battle to Great Britain by 
 tearing up a treaty, and, mthout a scintilla of excuse, 
 invading Belgium ; they thought that their schemes 
 in South Africa, Egypt, and elsewhere would rend our 
 Empire and Protectorates asunder, instead of having 
 a totally contrary effect. From all quarters, from the 
 Great Empire of India, from the self-governing Do- 
 minions, and from the Crown Colonies, came spontane- 
 ous expressions of the determination of a loyal and a 
 high-spirited people to throw in their lot with Great 
 Britain in the dire and terrific struggle which they all 
 knew was impending. Without hesitation and without 
 reserve did they offer to help us, and nobly have they 
 
92 IMPERIAL UNITY 
 
 carried out their offers of assistance, by giving us men, 
 by drawing upon their resources, and in every other 
 way. Some day the full story of this will be known to 
 the world, and the muster roll of the brave soldiers 
 they sent to the flag will be pubhshed, and then we 
 shall have a record to be proud of. One of the greatest 
 assets of an Empire like ours is, so to speak, its crop 
 of men and women — not only their mere numbers, but 
 their quahty, their courage, their determination, and, 
 of course, their physique. The people of the British 
 Empire have lately been tried in the fires of stress and 
 have not been found wanting in any way. History 
 has shown us that a degenerate race, without those 
 characteristic qualities, soon declines, and becomes the 
 easy prey of a more virile, brave, and healthy people. 
 Turning from the general attitude of loyalty thus 
 displayed, it may be interesting first to refer briefly to 
 the splendid effort made in support of the Motherland 
 by " the old Dominion," as it is proud to be designated. 
 Canada has sent contingent after contingent across the 
 seas to the Old Country. Nor is this, as we are all 
 aware, the first time by many that Canada has either 
 shown her willingness, if required, to send her sons as 
 reinforcements to the British Army, or has actually 
 dispatched them to stand shoulder to shoulder in battle 
 with troops raised in the United Kingdom. History 
 tells us that after the rescission of the thirteen American 
 Provinces from Great Britain, nearly thirty thousand of 
 those who dissented from that disruption left what is 
 now the United States and migrated to Canada, largely 
 to the Maritime Provinces and to Upper Canada. 
 These men were known as "The United Empire 
 Loyalists." Unfortunately the subject we are dealing 
 
''THE UNITED EMPIRE LOYALISTS" 93 
 
 with in these pages does not directly lend itself to 
 a lengthy reference to the desperate and entirely 
 successful three years' defence of Canada and " Im- 
 perial Unity " against tremendous odds during the 
 years 1812, 1813, and 1814, in which many of the 
 Loyalists bore a gallant part. 
 
 There was only a handful of British regular troops 
 then in both of the Canadian provinces — about four or 
 five thousand, as England was at the time hard pressed 
 for soldiers and struggUng for her life in Europe. Our 
 troops were nobly supported by the United Empire 
 Loyalist Mihtia, and also by the French Canadians, 
 who sent as many of their militia regiments as w^ere 
 required most willingly. The latter fought alongside 
 of their British fellow-subjects and almost as one man 
 showed their unswerving loyalty. The British Cana- 
 dian joint forces, though half the size of their opponents' 
 forces, had the advantage of being well led by an able 
 British officer, Governor and Commandant of the 
 Upper Province, Major-General Sir Isaac Brook, and 
 leading counted for a good deal in those days. Since 
 that war the Canadians and their southern neighbours 
 have lived almost uninterruptedly in amity, and no 
 serious difference has occurred between them. The 
 war alluded to, together with the United Empire 
 loyalist traditions of so many of the old Canadian 
 families, accounts for many things which it is not only 
 difficult for the machine-made Prussian official to 
 understand, but which are also lost sight of by the 
 unthinking amongst our own countrymen. 
 
 At the termination of the Napoleonic wars in 1815 
 and the consequent reign of a universal peace, a fresh 
 start was given to Canada by the immigration into that 
 
94 IMPERIAL UNITY 
 
 country of, in the first place, thousands of soldiers 
 who were disbanded at the close of hostilities. A large 
 number of retired naval and mihtary officers, as well 
 as the disbanded soldiers, were given grants of land in 
 Canada, mostly in the Upper, but a certain number in 
 the Lower Province. There were also large numbers 
 of both Highlanders and Lowlanders from Scotland 
 who went to Canada about that time to seek their 
 fortunes. To these was added a large influx of agricul- 
 tural labourers and hand-loom weavers from the 
 northern districts of England, the latter being thrown 
 out of employment owing to the introduction of im- 
 provements in machinery and the concentration of 
 work in urban mills. The bulk of these immigrants 
 proceeded to the better lands of Upper Canada, though 
 some went to Quebec or the Maritime Provinces. 
 
 Although the Federation of all the British North 
 American Provinces had long been in the thoughts of 
 many Canadian Governors-General and statesmen, and 
 was even discussed by many far-seeing people as far 
 back as 1812, it was never considered practical or 
 taken up in earnest till Canada found a man of shrewd- 
 ness and strongly imperialistic vievrs in the late Sir 
 John A. Macdonald, who tackled the question in 
 earnest, and, aided by other Canadian statesmen, 
 including the late Sir Charles Tupper, was enabled to 
 carry it through. The time he chose for his effort in 
 this direction was, no doubt, an opportune one ; he 
 took it, and did not, as another man of a more dilettante 
 turn of mind, in his position as Premier, might have 
 done, make one or two mellifluous and well-turned 
 oratorical efforts setting forth its advantages, and then 
 let it drop. The difficulties he had to encounter were 
 
THE FEDERATION OF CANADA 95 
 
 innumerable, but they did not daunt him, and at length 
 all the various provinces except three (two of which 
 have since joined the Dominion of Canada) having 
 agreed to federation, a convention was held of delegates 
 from the assenting provinces at the Westminster Falace 
 Hotel, London, just half a century ago in the winter 
 of 1866-7. They settled the details, and in the 
 March of 1867 the British North America Act passed 
 without opposition through the Imperial Parliament 
 at St. Stephen's, and received Queen Victoria's assent. 
 
 For general convenience and security of situation, 
 as well as to prevent jealousy and contention, the 
 capital was fixed at Ottawa, hitherto an obscure 
 country town. The Constitution was most carefully 
 framed ; it has much in common with the constitu- 
 tional precedents of the United Kingdom, together 
 with some borrowed from the United States, care 
 having been taken to avoid any points of possible 
 divergence or weakness Avhich the American scheme 
 had shown, such as the line of demarkation between 
 Federal and State rights, which were partly, no doubt, 
 the cause of the great civil war between the Northern 
 and the Southern States of that Republic. It has also 
 some features sui generis to suit the circumstances of 
 the country for which it was framed. It has proved 
 by experience to have worked smoothly and well. 
 
 The Dominion Cabinet's work for the first twenty 
 years was mainly in regard to two questions, both of 
 vital importance to Canada. The first was that of 
 framing a tariff high enough to prevent the rising 
 industries of Canada being submerged and swamped 
 by a flood of foreign imported goods, more especially 
 those of her southern neighbours. After 1866 America 
 
06 IMPERIAL UNITY 
 
 was feeling the result of her heavy debt, contracted 
 during the civil war. Favoured by a then compara- 
 tively low Canadian tariff, she was pouring her pro- 
 ducts into Canada, and this was found to have an 
 immediately bad effect on Canadian manufacturing 
 industry, not merely one of a threatening character. 
 
 It must be understood that a Free Trader in Canada 
 at that time was not, in the British Cobdenite sense 
 of that expression, in favour of free imports. Free 
 Trade in Canada meant a tariff for revenue on all 
 conveniently taxable commodities. Those who op- 
 posed that policy were in favour of having a tariff so 
 high that home-made goods could compete with 
 foreign manufactures. The divergence of opinion in 
 the Canadian Federal Parliament respecting the tariff 
 was one of degree only as to how high the duties 
 should be, and not, as here, involved in the question 
 as to whether free dumping of foreign goods should be 
 allowed or not. To the British mind a difference 
 between fifteen and thirty per cent, duty may not 
 appeal, or seem likely to constitute two bitterly 
 opposed schools of economic thought, but undoubtedly 
 this was what happened at that time in Canada. 
 
 It should also be borne in mind in this connection 
 that at the expiry of the commercial treaty with 
 Canada in 1865 the United States, who were at that 
 time anxious to convince Canada how much she lost 
 by not being a portion of their Union, refused to renew 
 the reciprocity treaty. The Americans were then 
 also sore with Great Britain owing to the escape from 
 an English port of the Alabama, which had captured 
 or destroyed many of their merchant ships during their 
 civil war and also broken their blockade. We agreed 
 
"THE NATIONAL POLICY" OF CANADA 97 
 
 to arbitration in this matter, the award went against 
 us, and we paid a large sum in compensation for the 
 damage done. The consequence of this refusal in 
 regard to reciprocal trading with America, and, 
 secondly, the dumping of goods on the Canadian 
 market from the States, caused serious depression in 
 Canada ; they had then only three million inhabitants 
 against forty million in the States. 
 
 Soon after this the Canadian Premier, Sir John 
 Macdonald, carried through his famous measure 
 known as " The National Policy," which consisted in 
 imposing a duty averaging about thirty per cent, on all 
 imported goods. This protection of home industries 
 has remamed ever since the basis of Canadian policy, 
 and when in 1896 a Liberal Grovernmcnt, after being 
 seventeen years out of office, came into power, the 
 Free Traders had vanished from the land, and the new 
 Government carried on the same fiscal policy as their 
 political opponents. 
 
 One of its earliest acts, under Sir Wilfrid Laurier's 
 premiership, was to grant preference — that is, a re- 
 duction of about one-third of the duty on certain 
 British goods, which greatly increased the volume of 
 British trade into Canada, more especially the woollen 
 trade of Halifax and Bradford in Yorkshire. Soon 
 after the introduction of the higher tariff in Canada 
 to which we have previously alluded, the exports of 
 our woollen goods fell in value by about one-sixth, 
 and there was great depression in that industry in this 
 country. As our woollen manufacturers in York- 
 shire feared that one result of the new tariff would be 
 the loss to them of the power of selling at a profit in 
 Canada, a deputation of Yorkshire woollen manu- 
 
98 IMPERIAL UNITY 
 
 facturers moved in the matter, and sent a deputation 
 respecting their industry to Sir Michael Hicks- Beach. 
 They told him their markets were depressed, and this, 
 they stated, had been in a great measure caused by 
 the exclusion of their manufactures from Canada, this 
 being the result of the Canadian protective tariff. 
 Sir Michael Hicks-Beach in reply informed them " that 
 he should consider very carefully what they had 
 placed before him." That is just the kind of stock 
 reply a Minister in a " free-import trade " country 
 has to make if an industry is being destroyed from 
 the effects of a foreign tariff. The words were spoken 
 as long ago as 1878, but they might be kept for use 
 whenever a deputation of manufacturers is received 
 at the Foreign Office until we change our present 
 hopeless and helpless tariff system. 
 
 It is, undoubtedly, a matter of great regret that no 
 reciprocity has been shown by Great Britain for this 
 graceful and generous act on the part of the Old Do- 
 minion in giving a 33Jth preference to certain of our 
 exports under their tariff, nor has it been properly 
 understood and appreciated by the working-men of 
 the United Kingdom, who are led like a flock of sheep 
 by a number of noisy political agitators to vote for 
 what are wrongly called "Free Trade" candidates. 
 Both Halifax and Bradford return " Free Traders," or 
 men who certainly would have refused to give any 
 preference to the industries of Britons beyond the 
 seas in Canada, or anjnvhere else. 
 
 A few words here regarding the plan of prohibiting 
 imports which the late Government jumped at in order 
 to evade the real remedy, namely, a British general 
 tariff, will be much to the point. It is, of course, as 
 
PARTNERS IN PEACE AS WELL AS WAR 99 
 
 they know, ultra-Protection, and only intended to be 
 a temporary measure. Li Canada it is, however, 
 hoped that in any new measures of a permanent 
 character which will be taken to restrict imports it 
 will be remembered that Canada and Australia are 
 partners with England in peace as well as in war. 
 That view is largely held also in the United Kingdom, 
 and will be, we believe, the opinion of the majority 
 of our people, if it is not in fact so at present. Whether 
 any of our leading statesmen in the United Kingdom 
 will have the courage to grasp the nettle, and really 
 spare no effort to carry a deihiite national and Im- 
 perial fiscal system through, we shall in due course 
 see. 
 
 The second great question which, despite great 
 difficulties, was surmounted was the construction of 
 a great arterial line from east to west to open out the 
 enormous and prolific resources of the great North- 
 West, the Prairie Provinces, and British Columbia, 
 to give easy communication between one part of the 
 Dominion and the other without crossing into United 
 States territory, and to rectify in a great measure the 
 mistake caused by the large extent of territory our 
 commissioners surrendered in 1842, when, without 
 warrant, and apparently without necessity, they gave 
 up to the United States not only as fine a piece of 
 territory as any in the world, including parts of what 
 are now Ohio, Indiana, Michigan, and Illinois, but 
 also, in a measure, cut off one part of Canada from 
 the other, and isolated British Columbia from Mon- 
 treal and Quebec. It is idle to speculate on the value 
 of the territory we then flung away, or how much larger 
 and better knit together the confederation of Canada 
 
100 IMPERIAL UNITY 
 
 would now be had we not given up a large part of her 
 most valuable corn-producing districts. This blunder 
 — for it was a blunder — has been partly rectified by 
 the construction of the Canadian Pacific Railway ; and 
 if Canada can never have a " scientific frontier '* in 
 a commercial sense, one must trust that these com- 
 missioners decided on a satisfactory frontier in certain 
 other respects. 
 
 An epic might be written about the construction of 
 the Canadian Pacific Railway and the courage and 
 pertinacity with which the late Sir John Macdonald 
 and the men who afterwards became Lords Strathcona 
 and Mountstephen, and others of equal grit and 
 determination — some might say, rashness — stuck to 
 their guns and carried it through. They were, in 
 truth, the life and soul of what often appeared to be 
 a hopeless enterprise. Two of them have lived to see 
 it paying handsome dividends, and it has opened out 
 to the world some of the best corn-growing and cattle- 
 raising regions in the world. Far from it being suffi- 
 cient, however, to serve the prosperity it has helped 
 to make, and the whole of the country whose success- 
 ful future it has created, another great line is being 
 built farther north parallel to it. 
 
 British Columbia was very keenly in favour of the 
 construction of the Canadian Pacific, and, in fact, joined 
 the federation on the strength of a promise that it 
 should be made. That important province is fortunate 
 in possessing a milder climate than the rest of Canada, 
 and is more English and less American than any 
 other part of the Dominion. 
 
 Notwithstanding the enormous increase in acreage 
 under corn in Canada since the beginning of this century, 
 
BRITAIN'S GREATEST GRANARY 101 
 
 there are now more than thirty-five million acres, and 
 the extent of the live stock within her borders, which 
 in 1914 included nearly three million horses, over six 
 million cattle, two million sheep and four and a half 
 milUon pigs, Canada has not, as yet, been fully de- 
 veloped, and the day will probably come when three 
 times the present quantity of cereals will be grown, and 
 when her live stock will be far more numerous than it is 
 to-day. There are immense tracts hi her corn-growing 
 zone now untouched, and doubtless when the population 
 is larger the land will produce millions of hundred- 
 weights more grain than at present. The population of 
 Canada is now about seven and a half million, what will 
 it be when this century closes ? The best men to 
 emigrate are those with some practical knowledge of 
 farming, and the most successful settler in a new 
 country is a man who goes there after deliberation, 
 and with the facts before him, also the assurance that 
 he has the requisite qualities for his task — i.e. energy, 
 skill, and determination. 
 
 From time to time there are great booms in Canada ; 
 there was one when this century was young, in 1901-2^ 
 another twenty years previously. Thousands then 
 rushed to Winnipeg, which in two years reached a 
 population of thirty thousand . Many of the farmers 
 and their sons in the Province of Ontario left for the 
 promised land. Manitoba and its neighbouring pro- 
 vinces are marvellous regions for corn-growing and 
 cattle-raising owing to the great fertility in many parts 
 of their soil, and at that time exaggerated stories were 
 told about them. It was, it is said, a local jest in 
 Canada that nobody who returned from Manitoba could 
 ever speak the truth again ! 
 
102 IMPERIAL UNITY 
 
 It is interesting to note that in seventeen years 
 Canada nearly quadrupled her total trade. In 1897-8 
 it was $304,475,736, and in 1914-15 it had mounted 
 up to $1,120,253,772, so that Protection does not seem 
 to have injured either the manufacturing or the agri- 
 cultural prosperity of the Old Dominion. Let us 
 hope, as we have previously urged, that she has in the 
 future a prospect of increased mercantile transactions 
 with the United Kingdom under a well-arranged 
 system of mutual reciprocity. 
 
 At a luncheon given at the House of Commons by 
 the Empire Parliamentary Association in November 
 1916, when Sir Thomas White, Finance Minister of 
 Canada, was the principal guest, Mr. McKenna, at 
 that time the Chancellor of the Exchequer, who pre- 
 sided, in proposing " Canada and the Empire " said : 
 "Who would have believed that Canada, whose 
 financial development had made it necessary for her 
 to be a borrower year after year in the money market 
 of London, was to become not a burden, but a financial 
 aid to her Mother Country ? " And he also added that 
 " the balance of trade which was formerly against 
 Canada had now turned in her favour." This acknow- 
 ledgment that it is more beneficial to a country to 
 sell more of its goods and products than to buy an 
 excess quantity of them is an admission, coming 
 from a Free Trade Chancellor of the Exchequer, of 
 some importance. 
 
 Sir Thomas White, in his reply, told those present, 
 of whom the present writer was one, that Canada had 
 already sent a quarter of a million men overseas to the 
 war, and that there were as many more to follow, and, 
 speaking of the vast resources of the oversea Do- 
 
CANADA'S UNDEVELOPED WEALTH 103 
 
 minions generally, said : " Had we realised that they 
 were rich in natural resources beyond the dreams of 
 Empire ? " His earnest counsel was to develop those 
 resources and promote trade within the Empire. In 
 urging the inception of that policy by a system of 
 preference within the Empire, he contended that it 
 was " a matter of purely domestic concern." 
 
 It should be the duty of far-seeing statesmen in 
 this island mother home of our race to see that the 
 links which have bound us together in danger should 
 be thoroughly welded in time of peace and prosperity 
 — ^and one cannot do better than conclude these few 
 remarks on the Old Dominion, which the author has 
 visited on many occasions, and for which he has 
 a great admiration, by quoting the following extract 
 from one of the late Lord Dufterin's eloquent addresses : 
 
 "In a world apart, secluded from all extraneous 
 influences, nestling at the feet of her majestic mother, 
 Canada dreams her dream and forebodes her destiny 
 — a dream of ever-blooming harvests, multiplying 
 towns and villages, and expanding pastures, of con- 
 stitutional self-government, and a confederated Em- 
 pire, of page after page of honourable history added 
 as her contribution to the annals of the Mother 
 Country, and to the glories of the British race, of a 
 perpetuation for all time upon this continent of that 
 temperate and well-balanced system of monarchical 
 government which combines in one mighty whole, as 
 the eternal possession of all Englishmen, the brilliant 
 history and traditions of the past with the freest and 
 most untrammelled liberty of action in the future.'* 
 
 Let us turn next to the great Commonwealth of 
 Australia, whose federation was inaugurated on 
 9 
 
104 > IMPERIAL UNITY 
 
 January 1st, 1901, when the various States of which 
 it is composed joined together under the executive 
 power of one central Government with authority over 
 commerce, navigation, finance, defence, posts and 
 telegraphs, and certain other matters. 
 
 The area of this important part of Greater Britain 
 exceeds three million square miles, whilst its total popu- 
 lation is at present about five million. Needless to say, 
 with the exception of the tropical coast-line of the 
 north, this continent contains a chmate nearly every- 
 where highly suitable to Europeans, and a very 
 equable range of temperature, and it alone awaits a 
 larger inflow of immigrants to open it out and develop 
 its great agricultural, mineral, and other resources. 
 
 If an emigrant to Australia expects a paradise on 
 earth he will not find quite that. It has great natural 
 advantages ; on the other hand, it has, as one finds 
 everywhere else, a few things which may occasionally 
 occur of an adverse character, such as droughts or floods, 
 not to mention in certain parts well-meant but occa- 
 sionally slightly harassing legislation. The first of 
 these three is greatly palliated by irrigation and the 
 sinking of artesian wells, the second by dams, and the 
 last by legislative amendments. Australia is, not- 
 withstanding, a place where a man with energy and 
 determination can not only make a comfortable living, 
 but, if fortune smiles on him, accumulate considerable 
 wealth. 
 
 When this war broke out the Australian Government 
 discovered that its generosity had been abused, and 
 that the stranger within its gates from Germany had 
 established a practical monopoly of many of the 
 minerals and other natural products which bountiful 
 
THE DECISIVE ACTION OF AUSTRALIA 105 
 
 nature had placed within their territories. They 
 acted in that matter with a promptitude and decision 
 that left nothing to be desired, and which might have 
 been copied with most satisfactory results nearer the 
 capital of the Empire. They cancelled by legislative 
 enactment all these contracts which gave the enemy 
 control of zinc, w^olfram, etc., that were urgently re- 
 quired for military purposes to defend Greater Britain. 
 They did so because the contracts were against public 
 policy, as Mr. Runciman, M.P., who was then President 
 of the Board of Trade, said in his place in the House 
 of Commons last year : 
 
 " Australia, as soon as she knew wc needed wool 
 badly, prohibited the export of wool outside the 
 British Empire. Australia throughout, from the very 
 beginning, not only in regard to metal but also in 
 regard to wool, has acted in strict harmony with us 
 and with enthusiasm. No sooner did they reahse in 
 Australia and New Zealand that we required larger 
 supplies of frozen meat than they at once, with all the 
 enthusiasm of youth, said that they would take every 
 animal, and that every animal that passed through 
 the abattoirs of Australia and New Zealand should be 
 placed at our disposal ; and," Mr. Runciman added, 
 " without that large and direct control we should 
 have found it difficult to have kept ourselves suppHed." 
 
 In October 1916 an arrangement was arrived at 
 between the Imperial and the Australian Governments 
 in regard to practically the whole surplus grain stock 
 of Australia being acquired for the benefit of the 
 inhabitants of the United Kingdom, in order to keep 
 the price of bread down in these islands as far as is 
 possible. 
 
106 IMPERIAL UNITY 
 
 How did the Germans set about getting hold, as 
 they thought to our disadvantage, of the natural 
 wealth of Australia whilst they were preparing for 
 this war prior to 1914 ? 
 
 As the sea by beating against the shore finds out 
 any weak spot where its defences are not sure, eats 
 into it and undermines it by its ever-recurring and 
 persistent attacks till the foundations are washed 
 away, and the cliff falls into the devouring maw of the 
 destroying element, so the Germans by their system 
 of so-called " peaceful penetration " in Australia and 
 other parts of the British Empire made their attacks 
 to undermine our industries and trade and annex our 
 natural resources to our undoing. Sometimes this 
 attack was made openly by the promotion of German 
 Joint Stock Companies and clubs, the latter frequently 
 to advocate Pan-Germanic principles ; more often 
 this attack was made by more stealthy methods, to 
 undermine and, if possible, destroy our position as a 
 world Power, and also as a great trading and indus- 
 trial community, by a scientifically organised system 
 of robbery by erosion. It does not appear that either 
 Austria or Turkey, now their willing, or unwilling, co- 
 partners in the present war, were either cognisant of 
 all this, or guilty of acting with them in this pre-war 
 mode of aggression. 
 
 When Australia sets about doing a thing she is 
 nothing if not thorough, and as her Prime Minister, 
 Mr. Hughes, informed an audience which he addressed 
 at Liverpool, at the end of last May (1916) : 
 
 " There was not [at that time] one German com- 
 pany in Australia, there was not one company in 
 
AUSTRALIAN THOROUGHNESS 107 
 
 Australia with a German shareholder ; yet when the 
 war broke out the control of Australia by the Germans 
 was at least as complete as the control of Belgium by 
 Germany. All our metals, all our great financial in- 
 terests were dominated by her. To-day her influence 
 simply does not exist." 
 
 Who that has seen the regiments of either Canada, 
 Australia, or New Zealand march through the streets 
 of London, and marked the splendid physique of those 
 wiry, strong, and well-set-up men, looking as if they 
 were absolutely fit, can deny that the environment 
 which Britons beyond the seas enjoy conduces to 
 make the fine specimens of manhood the Anzacs have 
 sent to Europe, to uphold the honour of the flag of 
 the Old Country, and to stand shoulder to shoulder 
 with the five million sturdy soldiers from these isles 
 who have also volunteered at the call of duty to fight 
 the good fight ? 
 
 When peace comes, it should be our duty to keep as 
 many as possible of these men within the Empire's 
 ken, and not to lose more than we can help or let 
 them emigrate to other lands and drift away from the 
 Empire they have sacrificed so much to maintain. 
 On that, it is satisfactory to note that in New South 
 Wales, according to reports received, they are already 
 preparing land and homesteads, and even, to some 
 extent, arranging to stock them, by the voluntary 
 efforts of their citizens to give, at the conclusion of 
 the war, to some of the soldiers returning to their 
 shores a comfortable and suitable reward, and, it is to 
 be hoped, one which, aided by their endeavours, will 
 secure to them a competence for the rest of their lives. ^ 
 I See Appendix 11, 
 
108 IMPERIAL UNITY 
 
 The peopling of Australia is one of the great pro- 
 blems that have to be solved, and from that fact it 
 would appear quite as important to open absolutely 
 new districts by railways as to devote so much atten- 
 tion to cutting up the large sheep runs into farms 
 for closer settlement by small farmers. In Australia 
 nearly all the railways are owned and worked by the 
 various States. They have been built not so much 
 to open out new country, as in Canada, South Africa, 
 the Argentine, and even Siberia, as to provide facile 
 means of communication for the present population, 
 who ver}^ naturally, through their representatives in 
 the various State parliaments, use their influence to 
 get new lines made to serve their own districts, They 
 argue that it is better to lay lines through those areas 
 which are fit for closer settlement than to risk public 
 money on lines like the Canadian Pacific, for instance, 
 in the Old Dominion, to act as a pioneer for open- 
 ing out a country for development. 
 
 They are in favour of State-owned railways as 
 against ownership by private companies, and they 
 have been strongly opposed to giving grants of 
 national land to private groups of individuals to aid 
 them in the construction of railways, priding them- 
 selves on the fact that, with the exception of about ten 
 thousand miles of privately owned railways, no interest 
 has to be paid to railway shareholders for the capital 
 expended by them. Thej^ are, however, apparently 
 oblivious of the fact that their country has borrowed 
 something like £140,000,000 sterling from the British 
 investor for railway construction, and that the latter 
 receives his rate of interest for the money lent, and 
 has the guarantee of the State Treasury, and does not, 
 
RAILWAYS IN AUSTRALIA 109 
 
 therefore, run any risk whether the railway pays or 
 not. The Australian Government pays a higher rate 
 of interest for bonds than the 3*66 per cent, which is 
 the amount the railways in Australia earned on their 
 total capital in 1912-13. 
 
 It would also greatly conduce to cheapness in freight 
 and to increased facilities for intercommunication be- 
 tween various parts of Australia if there were, as is the 
 case in Great Britain, a uniform gauge of railways 
 instead of, in New South Wales, one of 4 ft. 8J ins., in 
 Victoria and South Australia one of 5 ft. 3 ins., and in 
 Queensland, Western Australia, and Tasmania a gauge 
 of 3 ft. 6 ins. We found the disadvantage of this 
 break of gauge some years ago in this country, and so 
 the Great Western Railway changed the whole of their 
 system from the broad to the narrow one of 4 ft. 8 J ins. ; 
 consequently we have established uniformity in that 
 respect in all arterial lines, and the loss of time under 
 the double gauge is avoided. 
 
 The cause of this divergence of gauge in Australia 
 was that each State, a few years ago, before the federa- 
 tion of the whole continent into a United Common- 
 wealth, looked on itself rather more as an insular or 
 isolated unit than as a part of a great united whole. 
 There is a consensus of opinion now that this should 
 be remedied throughout Australia, though the expense 
 of so doing would be a heavy one. In due course, if 
 the powers are exercised for the Federal Government 
 to control all the States' railways, this question will 
 probably be taken up and uniformity established. 
 
 It will be seen from this that the tendency in Canada 
 is for the new-comers to go West and open out new 
 rural areas, whereas in Australia it is to settle them 
 
110 IMPERIAL UNITY 
 
 on the land already partially opened out by the pastoral 
 farmers or " squatters," as they used to be called, or 
 to join the already disproportionately large urban 
 populations to the whole community in the cities and 
 towns. Hence there are fewer people in Australia on 
 the land than one would expect, although the life that 
 country can offer to an agriculturist is, as a rule, both 
 a pleasant and a happy one. 
 
 Many more of the people of these islands who 
 emigrate go to Canada than to Australia. Why is 
 this ? Why should Canada, with its long winter, 
 attract more settlers than Australia with its genial 
 climate ? Several reasons may conduce to this : in 
 the first place the journey to Canada is much shorter 
 than to Australia ; then, in Canada, the regulations 
 as to the admission of an immigrant are not so severe 
 as is the case in Australia — in^f act, there is no hindrance 
 put in the way of a skilled workman in entering Canada. 
 Again, the grant of land which a new settler is offered 
 in Australia, whilst very liberal as to terms, is in most 
 if not all the States not absolutely free as is the case 
 in the grant of a hundred and sixty acres of free land 
 in Canada. 
 
 Prior to the great war Australia had no organised 
 industries whatever, but now three industries are 
 organised— wheat, sugar, and metals. In agriculture 
 some of the State Governments had guaranteed the 
 farmers a minimum price for all wheat grown on new 
 lands, and as the result of that and other subsidiary 
 inducements ten and a half times as much as before 
 had been produced. They had made similar arrange- 
 ments regarding the sugar-growing industry ; stringent 
 laws have been passed prohibiting the labour of Pacific 
 
A WHITE AUSTRALIA 111 
 
 Islanders on the sugar estates in the tropical part of 
 Australia, which district is said to be unsuitable for 
 white labour. 
 
 That, of course, brings one to the somewhat knotty 
 subject of a White Australia, which is a difficult one to 
 approach, as there are, no doubt, many arguments in 
 its favour and but one or two against it, and which is 
 mainly, if not entirely, a question for the Australians 
 themselves to decide. In the first place they see that 
 the importation years ago of slave labour from Africa 
 into America has not been altogether a success, despite 
 the fact that the sugar and cotton growing in the 
 Southern States was thereby expedited. Then, no 
 doubt, the Australians feel that if they opened the 
 sluice-gates to Asiatic immigration for the teeming 
 millions of Asia they would soon be swamped, and 
 that the competition of these races of men working 
 long hours for little pay would drive down their workers' 
 wages, or leave them unemployed, and this would 
 mean the difference between comparative comfort and 
 penury. Further, this economic invasion of Australia 
 by Asiatics might lead to one of another sort. Apart 
 from that altogether, from an Imperial point of view 
 the difficult}^ lies in the exclusion of the inhabitants of 
 India, the Straits Settlements, and Hong-Kong (all 
 British subjects) from Australia. It may be con- 
 sidered that this difficulty could be partly met by 
 limiting the number of immigrants allowed to enter 
 the northern zone of Australia from these parts of the 
 Empire. 
 
 One has to face the fact that that part of Australia, 
 with its tropical heat, is barely suited for European 
 labour, and that the northern territories, " the great 
 
112 IMPERIAL UNITY 
 
 lone land," as it is called, is left almost deserted by 
 the inhabitants residing in more temperate and 
 favoured regions in the rest of that continent ; and 
 though it is said to be in many portions of its vast and, 
 at present, little known area suitable for the growth 
 of sugar and other tropical vegetation, little is yet done 
 by its thousand or so white inhabitants to develop it. 
 Indeed, owing to the paucity of their numbers, how 
 could they ? This is a difficult and a delicate subject 
 which the able administration of the Commonwealth 
 of Australia, in the interests both of Australia and the 
 Empire, Avill some day have to meet, and which we 
 trust they will solve satisfactorily. 
 
 To settle industrial disputes the compulsory arbitra- 
 tion laws of Australia can be put in force. Nothing 
 is outside their jurisdiction — wages, hours, privileges, 
 duties, or preferential employment. No workman of 
 any other country — an Englishman for instance — is 
 permitted to enter Australia even if he has entered into 
 a contract with an Australian employer, unless the 
 Minister of External Affairs is of opinion that there 
 exists a difficulty in obtaining a worker of equal skill 
 and ability in the Commonwealth. Therefore, although 
 wages are higher, hours shorter, and conditions of 
 employment in Australia satisfactory, the skilled British 
 artisan does not emigrate to that country as a rule, 
 for, even if he takes the precaution to get a definite 
 job before he starts on his long and expensive journey 
 thither, he may not be allowed to land, and he does 
 not care to take his chance of getting work such as he 
 is used to on arrival, as, if he fails to do so, he is forced 
 to turn his hand to any employment he can obtain. 
 
 Australia, being a continent by itself, had not in its 
 
THE SHEEP-RAISING INDUSTRY 113 
 
 borders formerly many of the animals, such as sheep, 
 common in nearly every other part of the habitable 
 globe, and the tremendous Australian sheep-raising 
 and mutton- and wool-exporting business has grown 
 up in practically little over a hundred years. A few 
 sheep were imported from Ireland and a few others 
 from India and New South Wales ; they appeared to 
 thrive well, and shortly after that, in 1797, several 
 fine wool merinos were imported from the Cape and 
 distributed amongst six or seven of the squatters. 
 
 Mr. Foster Frazer, in his work on Australia, mentions 
 that — 
 
 " all these little flocks which were consequent upon 
 their importation disappeared, except that of Captain 
 Macarthur ; they were probably eaten. Captain 
 Macarthur crossed his Cape sheep with those already 
 on the island. Later, in England, when George III 
 had a sale of the progeny of sheep which had been 
 presented to him from Spain, Macarthur became the 
 possessor of some of the best and paid the highest 
 price that has ever been paid in England for sheep. 
 These he proposed to export to Australia. Curiously 
 enough, he was for a time barred by an ancient statute 
 which made it a felony to export live sheep from Great 
 Britain. That difhculty was overcome by the exercise 
 of common sense. Macarthur brought his sheep to 
 New South Wales. By judicious breeding he began 
 cultivating sheep for their wool. This process has been 
 continued until to-day. No sheep in the world carry 
 so much wool as do those of Australia " — 
 
 or wool which is more highly esteemed by the manu- 
 facturers of Yorkshire or France and elsewhere. It 
 is long, thick, and beautifully fine. 
 
114 IMPERIAL UNITY 
 
 From such a small beginning so recently undertaken 
 what an important industry has arisen, both in regard 
 to the exportation of wool and now by the process of 
 cold storage of mutton ! Of all the mutton imported 
 into the United Kingdom in 1911-13 Australia sent 
 us a quarter, whilst of the enormous quantity of our 
 wools from overseas no less than thirty-six per cent, 
 comes from Australia, which possesses now over one 
 hundred million sheep. 
 
 Besides the absence of indigenous sheep in Australia 
 there was not, at the end of the eighteenth century, a 
 horse, a cow, a rabbit, or a sparrow. They are there 
 now, needless to ssij, in abundance. And the rabbits 
 and the sparrows the Australians could do very well 
 without. 
 
 On the arrival of the conies the climate appears to 
 have suited them so well that they increased and 
 multiplied to such an extent as to become a scourge ; 
 they would, especially in a dry season, eat up every 
 blade of grass on the squatters' land and leave none for 
 the sheep to feed on. They were literally all over 
 many districts in their millions ; they became a pest 
 and were regarded as vermin by the Australian settler. 
 Thousands of miles of wire fencing were put up to keep 
 them out. Every means that could be devised to kill 
 or trap them was adopted, but for a long time little 
 impression seemed to be made on their numbers. No 
 Australian will eat them, though now, owing to the 
 means of exporting them by cold storage to European 
 markets, and the value of their skins, they are con- 
 sidered to be rather less of a nuisance than they were. 
 Still, they are no more favourably regarded by the 
 Australian farmer than the grain-devouring sparrow. 
 
ENCOURAGEIVIENT OF DAIRY FARMING 115 
 
 Being aware of the scourge which rabbits had been 
 in Australia, and knowing that in the United Kingdom 
 they have plenty of enemies to keep them down, and 
 that, except in a few districts, they are not over- 
 numerous but command a good market price, one 
 confesses that one was astonished to read in an English 
 journal recently that — 
 
 "the Australian can make a good living catching 
 rabbits — the more he catches the more people like him. 
 The Englishman is more likely to get three months in 
 prison if he tries to catch any." 
 
 That statement is hardly a fair one, as rabbits are 
 not the pest in England that they are in Australia. 
 If a man robbed an orchard either in England or 
 Queensland, Australia, and was caught stealing a 
 basketful of apples, he would be equally punished in 
 either country. 
 
 In most industries there is a somewhat lengthy 
 period before the receipts from the produce come 
 in ; not so in the case of the dairy farmers, who are 
 paid in Australia monthly for the products supplied. 
 The Government of Victoria have done all in their 
 power to stimulate dairy farming and have estabh^ hed 
 butter factories, and also given instructions to dairy- 
 men to establish those factories on the co-operative 
 principle. They have also given, by way of further 
 encouragement, a graduated bonus on butter with 
 the higher premium on the product which fetches the 
 higher price in the London market. 
 
 The amount of butter imported to the United 
 Kingdom from Australia, according to the report of 
 the Royal Commission on Food, etc., " of certain por- 
 
116 IMPERIAL UNITY 
 
 tions of His Majesty's Dominions " recently issued, 
 had almost doubled between 1901 and 1914, in the 
 former year being 248 thousand hundredweight, and 
 438 in the latter. The rise in the amount of wheat sent 
 from Australia in those two periods was even more 
 marked, being for the first-named year 5*4 million 
 hundredweight, and for the latter no less than 121 
 million. 
 
 The resources of Great Britain, though large, are 
 limited, those of the British Empire as a whole are 
 boundless ; and when thoroughly developed in all 
 directions its mineral as well as its agricultural wealth 
 will place us in a position of great economic strength. 
 There are difficulties in carrying out all the vast 
 Imperial problems which have to be solved, and the 
 greatest difficulty will be the one we have made for 
 ourselves. If, however, we show the same determina- 
 tion to conquer any obstacles that are set in our way 
 that the men showed who were the pioneers in Aus- 
 tralia, we shall overcome them. They had a watch- 
 word which we should remember and adopt the spirit 
 of, namely, " Advance, Australia." 
 
 In New Zealand, as in all the British self-governing 
 colonies, the Mother Country contrives to make her 
 sovereignty felt as Httle as possible. Therein lies one 
 of the secrets of her success as a colonising power. 
 She does not rule and dominate, but is, as it were, the 
 first amongst equals. The visible Knks in the chain 
 which bind the United Kingdom and the Dominions 
 are the King, by his deputy the Governor, the fact 
 that the coinage bears his portrait, and that letters are 
 forwarded by the Royal Mail service. The whole of 
 the rest is self-government, from the Executive which 
 
LAND TENURE IN NEW ZEALAND 117 
 
 controls the administration, to the various munici- 
 palities and road boards ; and yet there is a strong 
 sentiment of oneness with the centre of the Empire, 
 which is felt even in the most distant Dominion, and 
 though the journey to London from New Zealand 
 takes five or six weeks, it is spoken of as "a trip 
 home " by many who have never seen these shores 
 before. 
 
 In many respects New Zealand is a close replica of 
 the Old Country, though not, of course, in all direc- 
 tions, and it thus follows out the contention of that 
 grand old colonist. Gibbon Wakefield, that a colony 
 ought to be in almost every essential a duplicate of 
 the country by which it was established — with this 
 difference, that everything good should be selected 
 and everything bad in the parent State be rejected. 
 He also, to obviate the improvidence and reckless dis- 
 tribution of waste lands, which led to too great a dis- 
 persion of the inhabitants, advocated the abolishing 
 of free grants of land, and charging for it what is 
 termed " a sufficient price," such price to be regis- 
 tered and to vary according to the circumstances of 
 each case. The acquisition of land in New Zealand 
 is now practical!}', however, within the reach of all 
 emigrants. 
 
 As the mode of holding land in New Zealand has 
 been altered by legislation as recently as 1907, a few 
 details respecting that change will be here referred to. 
 
 The New Zealanders have not generally adopted 
 the system, which obtains in most of the provinces of 
 their neighbours in Australia, of alienating the land 
 once and for all, of granting freeholds and using the 
 purchase price as revenue. They have instead adopted 
 
118 IMPERIAL UNITY 
 
 a way they consider better, and place to capital account 
 the cash paid by each individual for the absolute 
 acquisition of the national land. 
 
 Prior to the passing of the Act of 1907, the New 
 Zealand executive had let the land at a nominal rental 
 on nine-hundred-and-ninety-nine-year leases. Sir 
 Joseph Ward, who was Prime Minister ten years ago, 
 determined to do away with what he described as 
 " this eternal leasehold system " of holding land, and 
 succeeded in his efforts. 
 
 Under this statute, now in force, there are three 
 ways of acquiring land from the authorities of this 
 Dominion ; firstly, by the purchase of the freehold 
 tenure, though certain improvements have to be 
 effected before the full title to the land is granted to 
 the purchaser ; secondly, on a lease of twenty-five 
 years' duration, with the annual payment of five per 
 cent, on the value of the land so leased, and the right 
 to buy the freehold after the first ten years have 
 elapsed ; thirdly, on a renewable lease for thirty- 
 three years, and after that period has elapsed the 
 lease to be renewed if desired, but subject to a re- 
 valuation and an increased rental if the value found is 
 to be then enhanced ; the tenant to pay by way of 
 rental four per cent, on the capital value of the land as 
 valued at the time of the first or any other subsequent 
 leases. In order to prevent too great an amount of 
 land being held by any one individual, there are 
 various restrictive clauses, such as that which limits 
 the holding of land to a value of £40,000. 
 
 This novel departure in legislation in regard to land, 
 needless to say, w^as strongly opposed before it becam_e 
 law. The State in New Zealand, however, is by no 
 
WOMEN FRANCHISE IN NEW ZEALAND 119 
 
 means a harsh landlord, and is on occasion prepared 
 to advance money to the tenant at a low rate of in- 
 terest, and, should times not be prosperous, to defer 
 payment of rent. 
 
 The clauses in this Act for the compulsory pur- 
 chase of large holdings by the authorities have as yet 
 only been enforced a few times, as the terms offered 
 by the official valuer have been, in most instances, 
 accepted by the holder of the land, and on the whole 
 this somewhat drastic method of dealing with the 
 land question has worked, it is said, well. 
 
 In New Zealand, if a law is found good, or a system 
 workable, it is adhered to ; if not, it is soon altered 
 or abolished. Women have been within the last ten 
 years enfranchised in New Zealand. The franchise is a 
 very extended one, ninety- five per cent, of the adult 
 male and female population being registered on the 
 voting lists, and not far short of eighty per cent, of both 
 sexes cast their votes at elections. The result is said to 
 have shown little change in the relative voting power 
 of the various political parties. It has simply doubled 
 the vote. Nor has the possession of the franchise had 
 any marked influence on the character of New Zea- 
 land ladies, or turned them, as a sex, into violent 
 politicians. They have displayed no particular interest 
 in any question except that of favouring the restric- 
 tion of facilities for drinking, and, in regard to that, 
 have voted for what is known here as prohibition by 
 means of local option. 
 
 The women of New Zealand are said to be fond of 
 books, whether of the yellow novel or " eternal tri- 
 angle " description is not stated. They have a clear 
 idea of their domestic duties and are good wives and 
 10 
 
120 IMPERIAL UNITY 
 
 mothers. Very many of them are bold and fearless 
 horsewomen, and as fond of dancing and other social 
 amusements as their sisters elsewhere. 
 
 When they have a plebiscite or referendum in New 
 Zealand the proposal on which it is taken has to be 
 carried by a three-fifths majority, and that appears 
 to be a safeguard against an important question being 
 made law by the snatch majority of a few votes. 
 
 Regarding New Zealand as a component part of the 
 Empire and one of its natural storehouses of agricul- 
 tural, pastoral, and mineral wealth, it occupies an ex- 
 ceedingly favourable position. As the Northern Island 
 lies partly in a sub-tropical region, it enjoys abundant 
 sunshine and adequate rain, and is not subject to 
 drought, nor are the climatic extremes as great as are 
 to be found in Canada or even in Great Britain. The 
 country produces every form of vegetation — trees, 
 grasses, grain, tobacco, lemons, olives, grapes, and 
 other fruits and vegetables. 
 
 Cattle, sheep, horses, and pigs increase within its 
 islands. This will be shown by the fact that cattle 
 are found to multiply very rapidly after each enumera- 
 tion. The cattle by the last returns were in excess of 
 ten millions, and the sheep numbered over twenty-four 
 millions, whilst there are about thirty-nine million acres 
 in occupation. To transmit these products from New 
 Zealand there are numerous lines of steamers to Great 
 Britain, Australia, North and South America, and 
 Canada. In March 1914 there were 2,863 miles of 
 Government railway lines, and twenty-nine miles of 
 private Unes, as well as a thorough coaching system on 
 the well-made roads throughout the islands. 
 The external trade of New Zealand is progressing 
 
NEW ZEALAND'S EXTERNAL TRADE 121 
 
 yearly. In 1909 it amounted in all to slightly over 
 thirty-five millions sterling in value, and it had in- 
 creased by ten millions to over forty-five millions 
 sterling in 1913. The great bulk of these goods and 
 products is disposed of within the Empire, going 
 chiefly to Great Britain and Australia ; the former 
 receiving the 'greater part of the eight million pounds' 
 worth of wool exported, and the four and a half 
 millions sterling in value of frozen meat. 
 
 The imports into New Zealand are also chiefly from 
 the United Kingdom ; those from foreign countries 
 have never assumed large proportions, and ranged from 
 thirteen to seventeen per cent, of the total during the 
 first decade of this century. From 1899 to 1904 they 
 slightly increased, but from that date to 1909 they fell 
 oft' from seventeen to fourteen per cent, of the total, 
 neither has the export trade of New Zealand to foreign 
 countries ever been a large one. The decrease of the 
 foreign imports to New Zealand was no doubt due to 
 the preferential treatment of British goods since 1904. 
 The tariffs both in Australia and New Zealand are 
 fairly high ones, and the proletariat of those countries 
 are, to a man, protectionist. It is by their vote that 
 their representatives have given these preferences to 
 the products of the work of their fellow-workmen and 
 felloAV-subjects in the United Kingdom, who have, in 
 consequence, had increased employment at a remunera- 
 tive wage. 
 
 This brotherly and friendly action on the part of 
 Britons beyond the seas to their kinsmen in these 
 islands has caused, no doubt, great searching of heart 
 and anger to the cosmopolitan body of men who com- 
 pose the Cobden Club, the more so as they are absolutely 
 
122 IMPERIAL UNITY 
 
 powerless to prevent it, or to force the New Zealanders, 
 or any other of the people of the Dominions who have 
 given trade preferences to the Mother Country (in- 
 cluding Canada, Australia, and South Africa), to take 
 the dumped goods from Central Europe or other 
 foreign countries unless they choose to do so. 
 
 Their pamphlets and their speeches, whatever effect 
 they may have on a diminishing section of the British 
 working-men, are absolutely powerless to influence 
 them when once they have emigrated beyond the seas, 
 where they can look at things for themselves as they 
 see fit, and are no longer under the tutelage of Mr. 
 Cobden's disciples. Prior to the war, however, as these 
 disciples can reflect with satisfaction, Germany did 
 some trade with New Zealand to a moderate extent in 
 fancy goods, toys, chemicals, and musical instruments. 
 
 Mr. Max Herz, the author of a work on New Zealand, 
 published in 1911, advocated reciprocity betwixt that 
 Dominion and Germany. If that consummation was 
 ever likely to be entertained, it is scarcely possible 
 now after the reported barbarities inflicted upon certain 
 *' Anzac " prisoners-of-war by the Germans, for it will 
 take a generation, if not more, for such atrocious acts 
 to fade from the memories of our people either in Great 
 Britain or the Dominions. Whatever Bernhardi may 
 have preached and taught them, the Germans will find 
 that " f rightfulness " and defying the rules of not only 
 war but of civilisation will neither be to their advantage 
 during war nor after peace is again restored. 
 
 The same writer, in his work on New Zealand, having 
 criticised the action^of the Britons of the southern seas 
 in giving a few years ago to their Mother Country two 
 splendid Dreadnoughts to defend her flag and their 
 
THE AWAKENING OF 1914 123 
 
 own, the crews of which have done their duty nobly 
 during this war, proceeds to write as follows respecting 
 this handsome gift : 
 
 " The inhabitants of these islands (New Zealand) 
 warm themselves with the cheap praises of the news- 
 papers, etc., but I fear this will not prove enough to 
 drive out the chill when the awakening comes. Eng- 
 land can scarcely be commended for accepting from 
 her struggling daughter such an offer." 
 
 The awakening did come in 1914 when the Kaiser 
 showed his hand, having all his preparations for war 
 ready, and nobody in Great Britain or New Zealand of 
 British blood has regretted the splendid voluntary gift 
 to the Navy alluded to. So far as the "struggling 
 daughter " is concerned. New Zealand year by year, 
 one is glad to see, advances in prosperity. 
 
 It is eminently satisfactory to note, and it shows the 
 thoroughly practical turn of mind of the New Zealand 
 authorities, that their meat, butter, and flax are placed 
 on the market in the best possible condition, a system 
 of inspection ensuring that their quality may be such 
 as to win renown and command high prices. The laws 
 order, and enforce absolutely, the utmost cleanliness 
 and purity. The butter before being shipped is ex- 
 amined by Government expert officials, and a common 
 stamp for New Zealand has been introduced. The 
 inspector then classes the quality in different grades, 
 and the buyer sees from the box what the quality is. 
 Flax fibre is similarly inspected and classified. 
 
 Prosperity in New Zealand has not been confined 
 to the large landholder with his immense flocks and 
 herds and his thousands of acres of land under crops. 
 
124 IMPERIAL UNITY 
 
 to the successful manufacturer, merchant, shipowner, 
 or those who are known as the professional classes ; 
 but the small holders who began life by obtaining small 
 sections, and lived at first under canvas, have also in 
 many instances come into the position of the comfort- 
 ably off, to their own advantage and that of their wives 
 and families. Probably many of them, at first, had 
 an uphill struggle to get along, but help of some kind 
 or other came to them from their neighbours, and they 
 faced their difficulties with manly and womanly cheer- 
 fulness. Time went on, and found them the possessors 
 of comfortable homesteads with a fair stock of cattle, 
 with maybe an orchard or a well-stocked garden as 
 well. Some received, during the milking season, from 
 the nearest dairy factory, £40 or £50 monthly for 
 their dairy produce ; their children have also the 
 advantage of schools within a reasonable distance from 
 their homes, and, as a matter of fact, they have not 
 only enough in a modest way for all their wants and 
 those of their belongings, but they can also give 
 hospitality to a friend or to a passing traveller. 
 
 The great present importance of dairy produce in 
 New Zealand, which only started as an industry in the 
 middle of last century, may be judged by the fact that 
 whilst in 1901 New Zealand sent to the United Kingdom 
 butter to the amount of one hundred and sixty-seven 
 thousand cwts., in 1914 we received three hundred 
 and fifty-eight thousand cwts. of butter from the same 
 source. Cheese showed even a more rapid, up to a 
 ten-fold, advance in those fourteen years, or from only 
 seventy-nine thousand cwts. to seven hundred and 
 forty-two ! 
 
 Space will only permit a brief reference to the gold- 
 
THE FIRST RUSH TO THE GOLDFIELDS 125 
 
 mining industry of New Zealand, now a somewhat 
 prosaic business undertaking, though early in the first 
 *' rushes " it offered possibilities of a great haul, and 
 equally of danger and hardship, the men who were 
 travelling in bands to the newly discovered goldfields 
 to seek their fortunes being obliged to help one another 
 across the swirling and often flooded and dangerous 
 rivers. In what was called an " old man flood " in 
 those days, they would strive as best they could to 
 protect and aid one another, but sometimes a " pal " 
 or two were drowned in these crossings. 
 
 They lived a somewhat rough life, at first, in these 
 mining camps. Then quickly municipal institutions 
 came into existence. In the election of the repre- 
 sentative men and local authorities the miner is said 
 to have been careful. He looked for strength ; he 
 looked for character. In these miniature republics 
 they obeyed authority and punished the wrong-doer. 
 The policy they adopted is an excellent one if it can be 
 attained in actuality, especially the latter part of it, 
 " Equality of all with the Government of the best." 
 
 Before leaving this part of the subject respecting 
 the material advancement in recent years of New 
 Zealand, it may be interesting to note that at a luncheon 
 given by the Royal Colonial Institute at the Hotel 
 Cecil, on October 27th, 1916, to the Prime Minister of 
 New Zealand, the Right Hon. William Massey, and the 
 Finance Minister of that country, the Right Hon. Sir 
 Joseph Ward, Bart., the author had the pleasure of 
 hearing both these Ministers enunciate their views on 
 many of the subjects set forth in these pages, and their 
 views appeared to be strongly in accord with many of 
 his own. Mr. Massey stated that — 
 
126 IMPERIAL UNITY 
 
 '* We have already initiated a scheme of land settle- 
 ment for returning soldiers, but naturally New Zealand 
 soldiers must come first. The Government have 
 already set apart 500,000 acres of Crown land, the best 
 of the Crown land now remaining, and we have pur- 
 chased no fewer than 100,000 acres of privately owned 
 land for this purpose. Already subdivision is going 
 on, and before my colleague, Sir Joseph Ward, and 
 myself left New Zealand a number of returned soldiers 
 had got possession of their sections, and agricultural 
 operations had already commenced." 
 
 One also learnt that the settlers are charged a small 
 rate of interest on the value of their sections, and also 
 that if it is found needful the Government will lend 
 them up to £500 to purchase stock, for fencing, house, 
 and other equipment. 
 
 Would they could " galvanise " us here into doing 
 something of the same kind by reclaiming waste land ! 
 
 One thing will always be remembered as long as the 
 world lasts, that in proportion to its population New 
 Zealand sent the largest contingent of voluntarily 
 enlisted men, all eager for the service, to fight for the 
 Empire in the Great War. 
 
 We will turn next to the Union of South Africa, which, 
 under the distinguished Premiership of General Botha, 
 has notonly crushed a sporadic rising inaugurated partly 
 by German intrigue, and done so promptly yet without 
 undue harshness, but also defeated our German enemy. 
 
 The history of South Africa during the last twenty 
 years gives a remarkable instance of the power of 
 assimilation, and the aptitude for successful colonisa- 
 tion and friendly fusion of different races and peoples 
 into the union of nations known as the British Empire. 
 
 It is not given to any man, or to any people, to be 
 
DEFEAT OF GERMAN AMBITION 127 
 
 wise at all times, and, whoever may have been the 
 originators of it, there is no doubt in looking back 
 through the vista of years to the Jameson raid of the 
 winter of 1895-6 that a grave political wrong was 
 then committed. Still, the absolutely uncalled-for 
 telegram from the Kaiser, in a matter which was no 
 concern of his, to President Kruger, congratulating 
 him on its suppression, was an unfriendly act to Great 
 Britain, and should have opened our eyes to the real 
 sentiments of the German Emperor towards ourselves. 
 The terms of peace in 1902 between Britain and 
 Boer were honourable alike to both sides, and under the 
 skilful administration of Lord Milner and his successor, 
 Lord Selborne, aided by the patriotic action of most of 
 the leading men of both the Africander and the Pro- 
 gressive parties in South Africa, the fusion of the two 
 European elements in that vast country has become 
 more pronounced. As time goes on let us hope that 
 many of the rough edges still to be found here and there 
 will be smoothed over and obliterated, to the common 
 weal of the whole of that Union. 
 
 As in other parts of the British Imperial circle, the 
 growing hostility between England and Germany 
 during the last decade did not pass unobserved in 
 South Africa. To many in that distant Dominion it 
 had become an accepted belief within the last ten 
 years that the deadly struggle between the two 
 countries could not be staved off, that, in fact, it was 
 inevitable, and that at no distant date their struggle 
 for supremacy would have to be fought to a finish. 
 
 The majority of Dutch South Africans had not the 
 faintest sympathy with German aims, or with Prussian 
 ambitions, yet they could not be expected, at first, 
 
128 IMPERIAL UNITY 
 
 to feel towards Germany as the average Englishman 
 did, though they were not very passionately anti- 
 German either. The invasion of Union territory by 
 the German South- West African forces in 1914 aroused 
 them from any apathetic feeling as to the issues of 
 this world-wide war. Boer, as well as Briton, rallied to 
 the flag, and the capture of South- West Africa, despite 
 the well-armed forces they were opposed to and the 
 terrible physical difficulties they had to encounter, was 
 accomplished by General Botha and his brave troops 
 with great military skill, decision, and promptitude. 
 
 The framing of the Union Constitution of the South 
 African Colonies in 1907 is not only a clear instance 
 of how men of statesmanlike ability and determination 
 who set to work to do a thing can do it, but also a re- 
 markable example of how those who hold different 
 opinions on many subjects can unite for a common 
 object which they have all set their minds to accom- 
 plish. Mr. Lionel Curtis, Assistant Colonial Secretary 
 for Urban Affairs, had the able assistance in 1906 of 
 Mr. W. L. Kitchens (Treasurer), Mr. Patrick Duncan 
 (Colonial Secretary), Mr. Brand, and Mr. Leetham. 
 This group of Crown Colony officials had the immensely 
 valuable aid both of General Botha and General Smuts, 
 also of Mr. Malan and Sir Abe Bailey. The driving 
 power of this Union of clear-headed men brought the 
 Union into being. Difficulties, to them, were only 
 opportunities. 
 
 On October 8th, 1907, the National Convention met 
 at Durban, and later on at Cape Town. It com- 
 prised, amongst others, Mr. J. Merriman, Sir Henry 
 (now Lord) de Villiers, Sir Starr Jameson, Mi\ Moor, 
 General Botha, General Smuts, ex-President Steyn, 
 
THE SOUTH AFRICAN CONSTITUTION 129 
 
 Sir George Farrar, Sir Percy Fitzpatrick, Mr. Fischer, 
 and also Sir William Milton and Sir Lewis Mitchell, 
 acting in the interests of the Chartered Company. 
 That which had been foreseen to be one of the diffi- 
 culties to be surmounted, namely, the allocation of 
 the expenditure and receipts of the various railways 
 in British South Africa, was the first to be overcome. 
 
 The National Convention issued its report in 
 February 1909, and during that year the draft Act 
 of Union as amended was approved by the Pcxrliaments 
 of the various South African Colonies. In the case 
 of Natal, it was accepted after a referendum by a 
 large majority. It was passed by the Imperial Parlia- 
 ment during the same year, and by a proclamation of 
 December 2nd it was declared that on May 31st, 1910, 
 the eighth anniversary of the peace of Vereeniging — 
 the Union Constitution should come into operation. 
 
 Taking a normal year's trading prior to the excep- 
 tional circumstances caused by the Great War, it is 
 satisfactory to note how large a percentage of the 
 South African import trade was from the United 
 Kingdom and other parts of the Empire, as will be 
 seen by the following table : 
 
 
 
 Per cent. 
 
 Imports from 
 
 Value 
 
 of Total 
 
 United Kingdom 
 
 . 22,141,489 
 
 54-87 
 
 Australia 
 
 . 2,022,989 
 
 5-01 
 
 India .... 
 
 1,138,210 
 
 2-82 
 
 Canada .... 
 
 880,222 
 
 2-18 
 
 Other British Possessions . 
 
 662,589 
 
 1*64 
 
 Total British Possessions 
 
 . 4,704,010 
 
 11*66 
 
 Total— British Empire 
 
 . 26,845,499 
 
 66-63 
 
 The balance of the South African import trade, or 
 33*47, about one-third of the whole, was from foreign 
 
130 IMPERIAL UNITY 
 
 countries, the United States heading the list with 
 9*38 of the whole, and Germany coming second with 
 8-73. 
 
 In regard to their export trade in the same year, 
 consisting chiefly of gold and diamonds (the former 
 to the value of over thirty-seven and a half million 
 pounds sterling), no less than 88' 7 per cent. of the whole 
 was to the United Kingdom. 
 
 It should, however, be borne in mind by the apostles 
 of Free Trade in this country that the assistance given 
 to the trade of the United Kingdom by the prefer- 
 ential treatment accorded to her goods in the South 
 African Customs tariff has been very material, and 
 has assisted her in the keen competition for business 
 with her commercial rivals, including the United 
 States and Germany. It is, indeed, largely the cause 
 of the fact that more than half their imports were 
 from the United Kingdom. 
 
 The system of tariffs now in force was first in- 
 augurated at the Customs Conference held at Bloem- 
 fontein in 1903, under the presidency of Lord Milner. 
 
 The main features then set forth for its leading 
 principles were : 
 
 1. The free admission of the necessaries of life, 
 including food-stuffs, except in cases where free 
 admission was found to be inconsistent with the en- 
 couragement of South African industries. 
 
 2. The moderate taxation, or free admission, of 
 building materials, agricultural implements, machinery, 
 mining plant, and generally of all articles necessary for 
 the development of the country. 
 
 3. The maintenance of the revenual efficiency of the 
 tariff by the imposition of heavy duties on luxuries. 
 
GOLD MINING ON THE RAND 131 
 
 intoxicants, and narcotics, and on articles minister- 
 ing exclusively to the convenience or pleasure of the 
 wealthier classes. 
 
 The grant of preferential treatment to articles pro- 
 duced within the United Kingdom was then inau- 
 gurated, as well as similar rebates to the goods of 
 other countries within the Empire. This system, one 
 is glad to see, is still in force, and by the Act of the 
 Union of South Africa of 1910, as amended by that of 
 1916, in many articles of commerce, such as cement, 
 candles, and cheese, we receive a rebate of one-fifth 
 on their general tariff. On all goods in which the 
 scheduled duty is three per cent, a rebate of the whole 
 duty is made in favour of the United Kingdom and 
 reciprocating British Possessions, and those products 
 are admitted free ; other reductions of duty of a 
 substantial character are granted to the produce and 
 manufacture of the United Kingdom and the British 
 Dominions by this tariff. 
 
 In South Africa one-third of the world's annual 
 output of gold is won, and ninety-five per cent, of this 
 comes from the Witwatersrand district in the Transvaal. 
 Curiously enough the fact stands that the conglomerate 
 beds of the Witwatersrand are essentially low grade. 
 The Rand gold industry, owing to the magnitude of its 
 operations, has been able to secure the services of the 
 most skilled mining engineers and metallurgists that 
 the world has produced. They have obtained by 
 their professional ability and skill a profitable recovery 
 from ores of lower grade than those which were origin- 
 ally neglected, and by economy in production have 
 maintained the profit even if the ores milled showed a 
 decrease in grade. 
 
132 IMPERIAL UNITY 
 
 Next to gold, diamonds are a great source of wealth 
 which bountiful Nature has given to this Dominion. 
 The discovery of the De Beers and Kimberley Dia- 
 mond Mines, the difficulties that had to be overcome 
 before their successful working was accomplished, and 
 how much they owed to the indomitable pertinacity 
 of Cecil Rhodes and others, would form the subject 
 of an epic. 
 
 The amount of the " blue ground " from the under- 
 ground working which is brought to the surface 
 annually when the mines are in full working is of such 
 an enormous extent that it would form a cube which 
 would more than hold St. Paul's Cathedral ! The 
 disintegration of this earth, its washing and separation^ 
 are matters of detail into which it is not proposed to 
 enter here. It must suffice if one mentions the in- 
 teresting fact that after every known mechanical 
 means of separation of the diamonds had been tried 
 and failed, it was discovered by one of the employees, 
 Mr. Kirston, that diamonds have a peculiar affinity to 
 oily matter, and an ingenious adaptation of this fact 
 has led to the invention of a machine " whose power 
 of distinction in the sorting of diamonds is far superior 
 to the keenest and most highly trained ej^e." In the 
 year 1913 these precious stones to the value of over 
 twelve million pounds sterling were exported from 
 South Africa. 
 
 Besides diamonds, this Union abounds in other 
 minerals, such as iron, coal, copper, silver, and tin. 
 The coal-fields near Newcastle in Natal are both ex- 
 tensive and produce coal of a very high quality, and 
 £1,392,464 of that product was exported in 1913. 
 Natal, the Garden Colony, as it is called, produces 
 
THE RHODES SCHOLARSHIPS 133 
 
 sugar, tea, coffee, cotton, fruit, and tobacco. The 
 vineyards of South Africa have recovered from their 
 attack of phylloxera, though, as yet, no appreciable 
 amount of wine is exported. 
 
 In 1913 ostrich feathers formed one of the largest 
 and most important branches of commerce in South 
 Africa, and of this commodity nearly three million 
 pounds in value were exported abroad. Cattle raising 
 formed a great and important industry, and even the 
 hides of the animals produced a sum in the export 
 returns exceeding two millions sterling. The Angora 
 goat, famous for its beautiful flossy wool, is found in 
 many localities. Maize is the chief cereal cultivated, 
 and is used by the natives in their " mealies." 
 
 On the roll of the Makers of Empire is inscribed the 
 name of Cecil Rhodes, who in 1888-9 founded the 
 British South African Company under a Royal Charter, 
 with the object of opening out to civilisation the 
 enormous tract of country from Bechuanaland to 
 Central Africa. Shortly after that date this company 
 peacefully occupied Mashonaland ; later on it added 
 Matabeleland to its jurisdiction, and the group of 
 colonies known as Rhodesia was formed. 
 
 Rhodes's busy and strenuous life ended in March 
 1902. Determined to encourage breadth of view in 
 the minds of future generations of young South 
 Africans, he instituted eight scholarships to be held 
 by colonials who would be educated at his old Univer- 
 sity of Oxford for the purpose, according to his will, 
 of " instilling into their minds the advantage to the 
 Colonies as well as to the United Kingdom of the 
 retention of the Unity of the Empire." Later on, in 
 A codicil to his will, executed in South Africa, he 
 
134 IMPERIAL UNITY 
 
 provided for the founding of five German scholarships 
 in the following words : 
 
 " I note," he said, " the German Emperor has made 
 English compulsory in German schools. I leave five 
 yearly scholarships at Oxford of £250 per annum to 
 students of German birth, the scholars to be nominated 
 by the German Emperor for the time being. . . . The 
 object is that an understanding between the three 
 Great Powers will render war impossible, and educa- 
 tional relations make the strongest tie." 
 
 The generous testator's object and hopes have not, 
 we are now only too vividly aware, been realised, and 
 the position of the University of Oxford in regard to 
 this bequest in the light of present developments and 
 the " Strafe England " teaching in Germany was, to 
 say the least of it, found to be so unchristian that it 
 has been abolished. Perhaps we may also be allowed 
 to wonder why the German Emperor ordered English 
 to be taught in his schools. Was it to enable as many 
 of his subjects as possible to spy out the land with 
 greater facility, or in order that he might have at his 
 disposal a large number of English-speaking civil ser- 
 vants to be administrators in our Empire after he had, 
 as he hoped, conquered it ? Or did he aim at turn- 
 ing his young men into commercial bagmen 
 (" drummers," as our American friends call them), for 
 the purpose of so-called " peaceful penetration," and 
 to cut us out in commerce ? 
 
 Ehodes's " great and brooding spirit " left behind 
 it other mementoes of his active mind, one of which, 
 namely, the Cape to Cairo Railway, may be realised, 
 let us hope, in the fullness of time. Already the 
 
THE CAPE TO CAIRO RAILWAY 135 
 
 traveller can ride luxuriously from Cape Town, with- 
 out a break, over 1,641 miles of railway to the Victoria 
 Falls on the Zambesi, and over one hundred miles 
 north of the border of Rhodesia in the Congo Free 
 State ; and though Rhodes himself was no more when 
 the Union of South Africa was accomplished, it was 
 one of the great projects ever present to his mind 
 whilst he trod this earth. 
 
 The estimated population of the Union of South 
 Africa for the year 1914, according to the Statistical 
 Abstract, was 6,465,000, not including Rhodesia, 
 Basutoland, or Swaziland. 
 
 One fact stands out in our dealings with the native 
 races in that Union and the adjoining Protectorates 
 (in the former the natives outnumber those of Euro- 
 pean extraction by nearly four to one, and in the latter 
 they form almost the sole inhabitants) — that, despite 
 the fact that we have had wars with many of these 
 races, including the Zulus, Matabeles, and numerous 
 other fighting tribes, our firm yet just rule is appre- 
 ciated by them ; when these wars were concluded and 
 peace was declared, they found that our word was our 
 bond, and that we would do our best to safeguard 
 their rights and protect their interests. Consequently 
 they look on us in the light of protectors, and as 
 children regard their father. 
 
 One instance of this attitude occurred in the middle 
 of last century. The Basutos had ceded their rich 
 corn lands, known to-day as " the conquered terri- 
 tory," to the Orange Free State, and were threatened 
 with dispersion, if not extinction. Their chief, Mor- 
 hech, sought the protection of the Imperial Govern- 
 ment, which he obtained, and Basutoland is to-day 
 11 
 
136 IMPERIAL UNITY 
 
 under the direct authority of the High Commissioner 
 for South Africa. Morhech's appeal was expressed in 
 language of great poetic beauty as follows : " Let me 
 and my people rest and live under the large folds of 
 the flag of England before I am no more.'* 
 
 Our rule in India is set in the midst of an old highly 
 cultivated civilisation of ancient Aryan origin, dating 
 back long before the Saxon period in these islands, 
 which has produced men of great intelligence, and, in 
 some instances, of judicial and administrative ability. 
 India cannot be left out of consideration in the Im- 
 perial circle of the States comprising the Empire, for 
 it is not only a part, but a very important part, of the 
 whole, as is seen when we take into consideration 
 her size, her geographical position, volume of races, 
 development, immense industrial population, military 
 value, and her proved loyalty to the Crown. 
 
 At the very commencement of the war, India pro- 
 vided two fully equipped divisions for the scene of 
 conflict in France. Indian troops have, indeed, served 
 in every theatre of this vast war in France, Africa, 
 Gallipoli, Aden, Mesopotamia, China, side by side 
 with their fellow-subjects from other parts of the 
 Empire, and have gallantly borne their full share of 
 the dread ordeal. 
 
 Lord Hardinge, then Viceroy of India, sent the 
 following dispatch to London when the sword was 
 drawn in 1914: "The Rulers of the Native States 
 have with one accord rallied to the defence of the 
 Empire, have offered their personal services and the 
 resources of their States for the war." 
 
 There are many questions of great import concern- 
 ing India's interest as part of the Empire which will 
 
INDIA, AND THE IMPERIAL CONFERENCE 137 
 
 have to be considered both now and at the close of 
 this war. These include trade, defence, the develop- 
 ment of Imperial resources, and our attitude towards 
 enemies. In 1915, in the Imperial Legislative Council 
 at Simla, a distinguished Mohammedan moved a 
 resolution " urging that India should in future be 
 officially represented at the Imperial Conference.'* 
 This resolution was carried without a division of the 
 Council, and submitted by the Viceroy to H.M. 
 Government, which authorised him to say that this 
 expression of opinion in the sense of the resolution 
 would receive most careful consideration. Of course, 
 the inclusion of additional members to the Conference 
 must depend upon the decision and approval of the 
 members of the Conference. 
 
 It would seem that in any scheme for ensuring that 
 the Empire shall be self-contained, India and its pro- 
 ducts must take a very important part, and therefore 
 Indian interests and opinions should be consulted. It 
 would be an advantage to have an open and free dis- 
 cussion of the points to be considered in reference to 
 all the various parts, instead of a single part of the 
 Empire. The exchange of opinions would enable 
 those taking a share in it to arrive at a common ground 
 of agreement, and prevent misunderstanding. Take 
 the case of Indian emigration as one subject, for in- 
 stance ; it might be possible that at such a conference 
 some solution of that question might be arrived at 
 which would satisfy the views of the Dominions and 
 be acceptable also to India. 
 
 The Imperial Council is a deliberative and not an 
 executive body. If India is represented at the 
 Council, each self-governing Dominion will remain, a^ 
 
138 IMPERIAL UNITY 
 
 now, free to accept or decline any proposals agreed 
 upon at the Conference. If we are to become the 
 British United States we must be so in reality, and 
 not merely on paper; nor does it seem practical to 
 evolve any truly Imperial united fiscal system both 
 within the Empire and in connection with foreign 
 countries without including India. 
 
 The raw material that India can produce in abun- 
 dance will be the indispensable foundation for the 
 establishment of many industries within Greater 
 Britain, and it is to be hoped that we shall never 
 again have to depend on having the raw material 
 produced within our Empire manufactured in a foreign 
 country. If Sir John Simon, and the other Cobden 
 Club enthusiasts for foreign-made goods, object to 
 that, they can emigrate to " their spiritual homes," 
 wherever they may be, or use the products of the 
 labour of the native inhabitants of Great Britain, 
 India, and the Dominions. 
 
 Taking the year preceding the war. Great Britain 
 absorbed forty-one per cent, of India's exports and 
 imports ; the rest of the Empire had eleven per cent., 
 and foreign countries took the balance, or forty-eight 
 per cent., nearly half. Neither Australia nor South 
 Africa had any appreciably large business transactions 
 with India. The total trade of India for that year w^as 
 three hundred and eighteen million pounds sterling, 
 exceeding that of Canada, which was two hundred and 
 twenty-six millions, and Australia, one hundred and 
 fifty-eight millions. 
 
 It is to be hoped that when this war ends there will 
 be a larger inter-Imperial trade between India and 
 the other parts of the Empire. There is in that great 
 
ENCOURAGE INDIAN INDUSTRIES 139 
 
 country a magnificent opening for fresh markets for 
 both the Mother Country and the Dominions, but 
 now it is a dumping-ground for the products of other 
 races than our own, who are very sparing in purchasing 
 any Indian product except certain raw materials for 
 manufacture, such as metal, flax, and hides. It would 
 seem to be to the interest of this country to encourage 
 the growth of cotton in India. If that were done the 
 quality would, no doubt, improve, and provide against 
 our Lancashire manufacturers being so dependent on 
 one source of supply, and the consequent risk of 
 having prices forced up to their disadvantage. 
 
 Before India came under the ban of the " free-im- 
 port trade " fallacy she had a number of flourishing 
 industries of her own. They are now mostly things 
 of the past. There is plenty of capital in the country, 
 but the operation of these works was checked and 
 swamped by unrestricted foreign competition. 
 
 Regarding raw material for manufacture from India, 
 before the war British tanners stated that " they 
 were unable to produce box sides in competition with 
 German manufacturers, who had a strongly protected 
 home market," in which they could make large profits, 
 " and free entry into the English market." After the 
 war broke out this trade was diverted mainly to the 
 United States. In India we have a great supply of 
 raw hides, of which laissez faire ordains that we take 
 little or no advantage ourselves. In 1915, out of a total 
 export of 16,361,624 raw hides and skins, less than a 
 twentieth, or seven hundred thousand came to the 
 Mother Country, America taking the lion's share. The 
 fact remains that whilst we have an abundance of hides 
 within the Empire, and tanning material galore, nearly 
 
140 IMPERIAL UNITY 
 
 all the leather soles of the boots worn by the British 
 civilian of all ages and sexes, and by the British 
 soldier, come from a foreign country. The tanning 
 industry, at one time a very profitable one, has been 
 greatly hampered and almost destroyed by foreign 
 bounties and by foreign dumping under our free- 
 import trade system, and, in consequence, the wages 
 of the workers in manufacturing leather from hides 
 goes to foreign employees. 
 
 The cultivation of tea has been steadily increasing 
 in both India and Ceylon, and also its consumption in 
 the United Kingdom. In 1863 only nine million lbs. 
 were imported here ; that had increased in 1901 to 
 one hundred and sixty million lbs. from India, and one 
 hundred and five millions from Ceylon, and in 1914 to 
 two hundred and three million, and one hundred and 
 ten million lbs. respectively. 
 
 Tea is now grown not only in the Assam district., 
 at Hazairbagh, in Bengal, but on the pleasant slopes 
 of the Neilgherries, in Madras, and also in the Kangra 
 valley, beneath the shadow of the mighty Himalayas. 
 When going over a tea plantation in that district, it 
 was most interesting to see the squat little tea bushes 
 ranged in rows, the particularly clean buildings where 
 the drying, pressing, and packing of the leaves were 
 carried on, and to remember that all this trouble 
 would have for its result the cheering, but not in- 
 ebriating, of a large portion of Her Majesty's subjects 
 in the United Kingdom. 
 
 The railway system of India has been vastly extended 
 in the last few years ; in 1889 there were 15,245 miles 
 of railway open to traffic ; in 1913 there were 33,599 
 miles open. It is not necessary to dwell on the effect 
 
INDIAN RAILWAYS, AND IRRIGATION 141 
 
 this must have on the population, their methods, and 
 habits, or on the extent to which it encourages a pro- 
 cess of fusion amongst all classes. The people avail 
 themselves of these increased traffic facilities to an 
 enormous extent. In 1913 four hundred and thirty- 
 seven million people took advantage of the opportunity 
 of travelling on the railways. There is, especially, 
 an immense passenger traffic carried on the lines 
 during the time when some native fair or festival is 
 being held. At Benares during the " Ramlela " vast 
 crowds arrive, literally " packed " in train after 
 train. The amount received by railway companies 
 in India from European passenger traffic, even in- 
 cluding the movement of troops and the annual 
 migration to Simla, is, comparatively speaking, small. 
 The first-class carriages for Europeans are particularly 
 roomy and comfortable, each carriage being supplied 
 with a washing compartment — a great boon in such 
 a hot climate. The carriages used by the natives 
 seem to meet their requirements, and there are, on 
 most lines, separate compartments for native ladies. 
 With regard to irrigation, no less than seventeen 
 million acres have been irrigated within recent years, 
 mainty in the northern territories. Much of this, 
 principally in the Punjab, was formerly practically 
 uncultivated land. The outlay upon it has been forty- 
 one and a half million pounds, and no capital has ever 
 been invested to better and higher advantage. As a 
 result you have this gigantic area of land producing 
 profitable crops, and enabling large and prosperous 
 colonies of cultivators to benefit by it. 
 
 In the district near Cawnpore, where both wheat 
 and barley are cultivated, the mode of irrigating the 
 
142 IMPERIAL UNITY 
 
 land is to carry the water over the country by a series 
 of main channels provided by Government from which 
 the cultivator makes his own offset into a small pond, 
 and distributes it over the crops by means of smaller 
 conduits. This system of irrigation from the main 
 channel he arranges and maintains at his own cost. 
 The water is turned on the growing wheat, patch after 
 patch, in a most skilful and careful manner. 
 
 In the year before the war, we imported from India 
 nearly nineteen million cwts. of wheat out of a total, 
 from all sources, of one hundred and five million cwts. 
 This large amount of grain comes not only from the 
 territory directly under the administration of the 
 King-Emperor, but from the vast domains of some 
 of the Native States under British protection. These 
 States are ruled by their own princes, and have each, 
 by arrangement, a force known as Imperial troops. 
 These soldiers, as at present, are available if required, 
 and have to a large extent volunteered for active 
 service in our armies. 
 
 Other of the native princes whose territories have 
 been absorbed in our own have no possessions beyond 
 the immediate vicinity of their palaces ; they are in 
 many instances allowed large pensions by the British 
 Government, and live surrounded by countless followers 
 in a sort of semi-state, possessing armed retainers in 
 numbers sufficient to form a guard of honour, whilst 
 in other respects their position is similar to that of a 
 wealthy English nobleman. 
 
 The internal history of India for the last few years, 
 since King George V held his durbar at Delhi and was 
 there crowned Emperor of India, has been one of 
 peaceful progress. A large number of the natives have 
 
THE EMPIRE'S RALLY TO THE FLAG 143 
 
 become members of the various legislative councils, 
 others have had the honour of being appointed High 
 Court judges (of whom sixteen out of fortj-four are 
 Indians), others again have become members of the 
 Indian Civil Service, and one has a seat on the Viceroy's 
 Executive Council. 
 
 The interests of India and our own are inextricably- 
 interwoven, and it is our duty to realise how important 
 that country is, and the great part she is destined to 
 play as a component part of the Empire and the 
 brightest jewel in the British Crown. 
 
 It is not proposed in these pages to go into detail 
 respecting the great and important resources of the re- 
 maining colonies and dependencies of the Empire ; one 
 and all have shown their loyalty and devotion to the 
 Homeland at this great crisis by every means in their 
 power — by the personal service of their sons in the 
 Empire's armies and fleets, by contributions either in 
 money or in kind, and in other ways that have con- 
 tributed to our assistance. They have done all this 
 voluntarily, in a way never to be forgotten. 
 
 In considering their natural wealth, one is lost in 
 amazement that wo have let others in the past partly 
 annex it, and have not acted more judiciously as 
 guardians and trustees for future sons of the Empire. 
 Take the old Colony of Newfoundland, for instance, 
 with its great resources ; take also Ceylon, Mauritius, 
 the Straits Settlements, British Honduras, Guiana, the 
 important British Colonies in East and West Africa ; 
 they are all natural mines of mineral, agricultural, and 
 pastoral wealth. 
 
 Can one afford to minimise the importance to the 
 E'npire of the strategic military and naval, and, in 
 
144 IMPERIAL UNITY 
 
 8om3 instances, great trading centres, ports, and coaling 
 stations of Cape Town, Hong-Kong, Gibraltar, Malta, 
 Bermuda, Singapore, Aden, Colombo, Point de Galle, 
 and numerous other places all over the world ? Then 
 let us consider the precious metals, of which the great 
 bulk of the world's suppl}^ are within our King- 
 Emperor's realms. Again, iron and coal, the hand- 
 maidens of commerce, are almost equally dispersed 
 throughout its bounds. During the present struggle 
 we have heard a great deal about zinc and its im- 
 portance for munitions of war. The list of places 
 where it can be found within the British Empire is a 
 long one, and includes The Broken Hill Mines near 
 New South Wales ; it is also worked for in Queensland, 
 New Zealand, Newfoundland, and Canada (particularly 
 in British Columbia), while a number of workable zinc 
 deposits are also found in British Burma, Egypt, 
 Nigeria, Rhodesia, and that great mineral region the 
 Transvaal. This product is known commercially as 
 spelter. The list of the Empire's resources in regard 
 to copper (that useful mineral for the arts of peace as 
 well as the ammunition of war) would be almost 
 equally long. 
 
 The remarks that follow are conJQned, however, to 
 the important and burning foreign-sugar bounty 
 question. Cane sugar was at one time the staple 
 industry of the then flourishing West Indian Islands ; 
 it was also grown in the Mauritius and in other tropical 
 and semi-tropical regions of the Empire, to the great 
 advantage and prosperity of their inhabitants. Un- 
 fortunately, by our false economic system of free 
 imports, we encouraged the foreign-bounty system, 
 and the industries of either growing sugar in the 
 
JAMAICA AND CUBA VISITED 145 
 
 Colonies or refining it in the United Kingdom (in the 
 East of London, Glasgow, etc.) were, when this war 
 broke out, nearly a thing of the past. It is quite 
 possible to revive those industries of growing and 
 refining sugar, and we should, to use Mr. Hughes's 
 phrase, not think about it, but "do it." 
 
 To anyone who has travelled much abroad, especially 
 in the Western Hemisphere, our action in regard to 
 the sugar-producing colonies of the West Indies is very 
 marvellous. About four years ago the author travelled 
 from Washington down through the southern States 
 of America, and took ship from Key West to the 
 Island of Cuba, now nominally independent, but in 
 reality under the aegis of the United States. That 
 island is in a very flourishing condition. The sugar 
 plantations were visited, tobacco was seen growing, 
 and prosperity evidently abounded in every direction. 
 
 The reason Avhy the Cuban agriculturist is prospering 
 is not difficult to discover. Cuba being more or less 
 a Protectorate of the United States, they give them a 
 certain preference in regard to their exportation of 
 sugar and, one understands, other commodities to 
 the United States. This rebate of duty enables them 
 to practically supply the major part of the imported 
 sugar required by their great neighbour. 
 
 After leaving Cuba a visit was paid to Jamaica, our 
 principal island in the West Indies. It made one 
 rather sad to see the totally different appearance of 
 Kingston as compared with Havana and other 
 prosperous towns in Cuba. This is partly owing to 
 the fact that the prosperity of Jamaica had greatly 
 waned as a result of our giving protection in the United 
 Kingdom to foreign beet sugar, by permitting it to be 
 
146 IMPERIAL UNITY 
 
 imported to our shores under a bounty system, whilst 
 we sternly refused any aid to our own fellow-subjects 
 in the West Indies. It is a fact that although at one 
 time we were nearly entirely supplied with sugar by 
 those Colonies to the great advantage of hundreds of 
 English people and thousands of those employed by 
 them on their estates, now the amount of sugar sent by 
 the West Indian Colonies to the United Kingdom is 
 infinitesimal, Avhilst prior to the war, in 1913, we re- 
 ceived unrefined sugar from Germany to the amount of 
 9*4 million cwts., from Austria 3*2 million, and from 
 Cuba 4-5 million. From all British Possessions, in- 
 cluding the Mauritius and the West Indies, our receipts 
 were only r4 million cwt. of that commodity. In 
 1913 we received no refined sugar at all from any British 
 Possession, although within its area we have hundreds 
 of millions of acres of land suitable for the growth of 
 both cane and beet sugar, ample labour in a population 
 exceeding four-hundred million people, and machinery 
 and coal for its refining. On the other hand we 
 received, to add to their wealth, and entirely in conse- 
 quence of the pernicious bounty system, 9*3 million 
 cwts. from Germany, 4 million cwts. from Austria, and 
 3" 6 million from the Netherlands (some part of which 
 was a transit trade from Germany), or 16'9 mUlion cwts. 
 of refined sugar from these three foreign countries out 
 of a total of 18*5 million cwts. In 1914 we received 
 from the United States 2*1 million cwts. and from Java 
 23 million cwts. of sugar. ^ At one time, prior to 
 
 1 These figures are given from the Memorandum and Tables of 
 the Royal Commission on the National Resources, etc., of His 
 Majesty's Dominions, presented to both Houses of Parliament, 
 November 1915 (Cd. 8123). 
 
THE SUGAR-BOUNTY QUESTION 147 
 
 Cobden's day, all this sugar was grown in the British 
 Possessions, and none received from abroad. It was 
 refined by British home or colonial labour, thus large 
 sums were paid in wages in the King's Dominions. 
 
 The question of these sugar bounties was, and un- 
 fortunately still is, an urgent one, not only for the 
 West Indies, but also for the sugar refiners both in 
 London and Glasgow. At one time there were a large 
 number of refiners on the Thames doing an excellent 
 business in refining sugar which came from the West 
 Indies. The same applies to the Clyde. All this is 
 practically now a thing of the past, as, owing to the 
 sugar-bounty system, their industries have been killed. 
 
 No doubt the cost of this system to the foreign tax- 
 payer is considerable. The gain to this countr}^ is, 
 or rather was, that prior to the war some people 
 probably imagined they bought their sugar a fraction 
 of a farthing a pound cheaper, and perhaps a few of 
 our manufacturers of soda water or jam believed that 
 they gained larger profits in consequence ; but if the 
 bounty system were abolished, and fair play given to 
 British-grown sugar within the Empire, competition 
 would keep prices down, and their profits would not be 
 diminished. 
 
 During the time when the writer was in Parliament 
 this question was brought up, time after time, by a 
 few members of the House, including himself. Speeches 
 sympathising with the destruction of the industry of 
 sugar refining in the United Kingdom, and regretting 
 that the agriculture of the West Indies had become 
 very depressed, were delivered by Ministers, but 
 nothing was really done, and these expressions of 
 sympathy did not mend matters at all. Conventions 
 
148 IMPERIAL UNITY 
 
 regarding sugar bounties were called together, con- 
 ferences were held, but the interested parties in favour 
 of this sugar-bounty system in the United Kingdom 
 were too strong, and were too wealthy and politically 
 important to one of the two parties in the State to allow 
 anything to be done. They were on the spot, and 
 could influence votes, whilst the planters in the West 
 or East Indies, Mauritius, Ceylon, and other sugar- 
 growing colonies were far away, and the home sugar- 
 refining industry therefore was not adequately safe- 
 guarded. 
 
 The mode by which this system of foreign bounties 
 is arrived at is that in Germany, and other European 
 foreign countries, all raw sugars are taxed according 
 to a graduated scale, supposed to be in proportion to 
 the amount of saccharine matter they contain, and 
 the refiners merely contrive to have the raw foreign- 
 grown beet sugar, which is entered in bond for refining, 
 classed lower than its true saccharine nature. When 
 this sugar is refined, if any of it is exported the refiners 
 are entitled to get back the duty, and they accordingly 
 demand a drawback equivalent to the full saccharine 
 standard which the refined sugar shows, thus mulcting 
 the State of the difference between the debit and the 
 credit. 
 
 By this means two very different objects appear to 
 be accomplished : the refiner, under the pretext of 
 the high duties, keeps up the prices of sugar at home 
 and realises large profits ; but abroad, by help of the 
 excise drawback, he appears as a cheap seller, and in 
 point of fact has within the last ten years almost driven 
 English sugar refiners out of the market. In short, 
 the higher the duty, the bigger, as a rule, are his profits 
 
EVILS OF THE SUGAR-BOUNTY SYSTEM 149 
 
 both ways ; for so long as his sugar is taken into bond 
 by colour rather than by its true saccharine value, he 
 obtains a larger profit on his drawback with every 
 augmentation of duty, and rises into more supreme 
 command of our free-import markets. 
 
 Our sugar refiners have made strong representations 
 regarding this bounty system, and a few years ago a 
 Convention was held at Brussels to really amend it, 
 as many of the foreign countries, including France, 
 had decided to do their best to put it down. This 
 Convention was suggested by our country in 1902 — 
 a Unionist Government being then in power — and was 
 signed by us in the number of European sugar-producing 
 countries in September 1903. 
 
 The solemn obligation thus entered into to abolish 
 the sugar bounties was repudiated by the next Ad- 
 ministration when they got into office. They therefore 
 left the other contracting parties bound by a National 
 Convention to produce and export their sugar without 
 bounties or excessive surtax, while in Great Britain, 
 their principal market, they were called upon to 
 compete once more with bounty-fed sugar, notwith- 
 standing our solemn obligation undertaken to the 
 contrary. 
 
 France appears to have been the sufferer by this 
 distinct break of faith, for whereas in 1901 she exported 
 to the United Kingdom five milHon cwts. of refined 
 sugar, it had dropped to 01 million in 1913, whilst on 
 the other hand one finds Germany increased its ex- 
 port of refined sugar to this country from 7' 9 millions 
 in 1909 to 9-3 millions in 1913. 
 
 Our Government claim the right to import freely 
 bounty-fed sugar, whilst still remaining in the Con- 
 
150 IMPERIAL UNITY 
 
 vention for the abolition of bounties ! A shortage of 
 one million seven hundred thousand tons in the 
 world's crop of beet sugar in 1911 was the pretext 
 seized upon by the Government to give notice of the 
 nullity of the Convention. This action has laid us 
 open to the charge of breach of faith, and has 
 caused our economic policy and methods to be 
 regarded with grave suspicion in this respect. The 
 position the then Government took up was no doubt 
 forced upon them by their desire to placate certain 
 people whose object was to obtain sugar at the lowest 
 possible price, regardless of whether that price was 
 a natural or artificial one. They had evidently 
 found it impossible to square this attitude with loyal 
 adhesion to a Convention which was entered into 
 primarily for the purpose of abolishing bounties, so 
 they thus pleased, probably, some of their cocoa or 
 chocolate manufacturing friends. Whilst we had a 
 Government pledged to "Free Trade," one could not 
 be surprised at this, or that they took no steps to 
 abolish the most obnoxious form of Protection, for 
 these two words appear to cover everything and to be 
 a shibboleth for bounties, dumping, or any other system 
 calculated to destroy our industries ; but under the 
 present Government may one hope that this question 
 will be looked into, and that our breach of faith both 
 to foreign countries and to our own employers and 
 employed in the United Kingdom will be ended ? 
 
 It should, however, be stated that in another direc- 
 tion the late Government seems to have endeavoured 
 to look at the question not so sternly through free- 
 import trade spectacles, for in a letter dated May 24th, 
 1913, addressed to the British Delegate on the Inter- 
 
HOW TO PREVENT FOREIGN BOUNTIES 151 
 
 national Sugar Convention, Sir Edward Grey, now 
 Viscount Grey, declared as follow^s : 
 
 " An exemption (total or partial) of sugar manu- 
 factured in the United Kingdom from the duty leviable 
 on imported sugar is, of course, not to be regarded as 
 a bounty, provided that the preference so accorded is 
 less than the surtax permitted by the Convention." 
 
 The Government is to be congratulated to that extent 
 upon their courage and common sense in throwing to 
 the winds, not for the first time, the effete doctrine of 
 Cobdenism, and encouraging a new British agricultural 
 industry ; also, to some extent, the sugar manufacturers 
 of this country, who will enjoy an advantage of 1.9. 10c?. 
 per hundredweight over their foreign competitors on 
 all beet sugar grown here, that being the customs 
 duty payable on imported sugar. 
 
 It is a very remarkable thing that orthodox free- 
 import traders have no objection whatever to Govern- 
 ment grants and bounties, which constitute the crudest 
 and most flagrant forms of Protection, but would rather 
 commit hari-kari than adopt the much milder form of 
 it by saying to the foreign producer : If you wish to 
 give a bounty on the products you send into this 
 country we cannot prevent you, but when we find out 
 the exact amount of that bounty we will charge you 
 the exact amount you so give in our import tariff ; we 
 will not allow that sum to be put solely into the pockets 
 of a few wealthy cocoa merchants and manufacturers, 
 but we will take the bounty you see fit to provide and 
 hand it to our Chancellor of the Exchequer in aid of 
 the taxation of everybody, rich or poor, who resides 
 within the bounds of the United Kingdom. 
 12 
 
162 IMPERIAL UNITY 
 
 Let the United Kingdom awake to the fact that 
 reciprocal trading would secure to the whole Empire 
 a steady inflow and efflux of commerce, and encourage 
 in every part industrial development in the field and 
 in the factory, whilst emphasising the fact that Imperial 
 unity should be attained by the Mother Country and 
 the Dominions co-ordinating their general interests 
 as far as possible, without infringing the powers of 
 self-government in all non-Imperial essentials. 
 
CHAPTER V 
 
 ALLIES IN PEACE AS WELL AS WAR 
 
 " Sure in the justice of her cause, standing by her King, backed 
 up by her Army in co-operation with the Armies of her Allies, and 
 confident in the resolution of the Protecting Powers not to sheath© 
 the sword until her complete independence is restored, Belgium 
 awaits with an unconquerable spirit the hour of liberation and 
 reparation." — Baron Beyens, Belgian Minister for Foreign Affaire, 
 
 After the war the world will be more or less divided 
 betwixt the British Empire, the territory of the Allies, 
 the territory of the neutral nations, and that of our 
 present enemies. 
 
 It is interesting and important to note the fact that 
 the territory belonging to ourselves and the Allies 
 controls fifty per cent, of the world's trade, that, also, 
 to the flags of the Allies about half the population of 
 the world owe allegiance, if that proportion is not soon 
 increased. The United States and Latin America 
 control eighteen per cent., neutral nations in Europe 
 and China fourteen per cent., whilst the aggressors, 
 Germany, Austria-Hungary, Turkey, and Bulgaria 
 account for eighteen per cent, of the world's trade, 
 and of its wealth and population. 
 
 A thoroughly effective rapprochement between the 
 Allies would act as a great safeguard for peace, as it 
 would spell commercial ruin to any nation or group of 
 
 153 
 
154 ALLIES IN PEACE AS WELL AS WAR 
 
 nations who dared to break the peace and again for 
 any reason, ambitious or otherwise, deluged the world 
 with blood. 
 
 If our statesmen can only cast aside for the nonce 
 any preconceived economic theories they have held in 
 the past, and act with promptitude and decision, they 
 have this great fulcrum ready to their hands, which 
 in the interests of civilisation and humanity they should 
 eagerly and promptly grasp. In considering this point 
 we must recollect that three of our great Allies in 
 Europe are protectionist countries, whilst neither 
 Japan, Belgium, Portugal, Serbia, nor Montenegro 
 allows most goods duty-free within their borders. We 
 have been for the last sixty or seventy years a free- 
 import trade country. The lead, therefore, in carrying 
 out many of the resolutions arrived at in Paris at 
 the Economic Conference should therefore naturally be 
 given by us. 
 
 We are all agreed that we wish to shake off the 
 incubus of German commercial penetration from which 
 some of us have suffered more than others. It is, 
 therefore, the more needful for the Allies to be on their 
 guard against the insidious methods of Germany ar^d 
 the encroachments of her trade. The lever to command 
 the destinies of the world was Germany's thoroughly 
 organised and equipped commercial attack on other 
 nations. This lever was recklessly thrown aside when 
 she drew the sword, and will no doubt, when oppor- 
 tunity permits, be made full use of again. 
 
 Before the war Britain, Russia, Italy, and Belgium 
 were politically free, yet all of them were more or less 
 economically under the sway of Germany, and even 
 France was so influenced in a lesser degree. Germany 
 
TRUE INTERESTS OF ENGLAND AND FRANCE 155 
 
 had woven the net of control of finance and industry 
 over all the countries named, and had wrapped its 
 meshes tightly round them in certain directions and 
 in other ways. Had she waited a few years more 
 before commencing hostilities, her economic dominance 
 in Europe would have been almost complete. Close 
 commercial relations exercise great influence in the 
 international relations of the Powers. In all ages of 
 man self-defence has been acknowledged to be ad- 
 missible, and if it is necessary to treat the German 
 trader for what in reality he is, namely, a political 
 agent, we must not hesitate to do so. 
 
 In considering questions relating to the resources of 
 our future trade with the Allies, with whom our troops 
 are now standing shoulder to shoulder on the assured 
 road, let us hope, to victory, our thoughts first turn 
 to France, our nearest neighbour, on whose soil the 
 invader's hordes are still established. Our material 
 trade relations are even now of great importance to us 
 both. In 1914 the exports from France to the United 
 Kingdom were valued at nearly thirty-eight millions, 
 and the imports to that country of British produce 
 and manufacture were valued at thirty-five millions. 
 Whether considered from a geographical point of view, 
 or with reference to the products of each country — 
 having regard also to natural causes such as the variety 
 of climate, the productiveness of the soil, or to mineral 
 resources — it may be said that there can be no two 
 countries better fitted for the freest possible inter- 
 change of commodities with one another than are 
 England and France. And there can be no doubt that 
 the freer you can make the trade between two such 
 countries, the more prosperous they will both become. 
 
156 ALLIES IN PEACE AS WELL AS WAR 
 
 From natural causes, and from the acquired bent of 
 the industry of the inhabitants of either country, they 
 need fear, were their interchange in commerce doubled, 
 no rivalr}^ except the rivalry of supplying each other's 
 wants. We can provide them with one of the solid 
 utilities of commerce, the motive power of progress, 
 coal, besides the products of our smelting furnaces and 
 engine shops, and the useful manufactures of our 
 power looms ; whilst tbey can give us in return the 
 produce of their vineyards, as well as those countless 
 objects of art and luxury in the creation of which they 
 excel owing to their taste and skill. It is, therefore, 
 to be hoped that the day may arrive when there will 
 be even a larger interchange of commodities between 
 us than at present. 
 
 The French National Debt, like ours, is a large one, 
 and when this war terminates it will then, as with us, 
 be a heavy burden on the taxpayers unless, by the 
 fortunes of war, it is borne by others. In any case, 
 they will feel it less than if it were held by a few 
 people, for the debt of France is held by nearly all her 
 sons, rich and poor alike. Regarding the French 
 National Debt it is worthy of notice that it is a crea- 
 tion almost entirely of the last hundred years. It is 
 curious to note that, during the years 1800 to 1814, a 
 period of fourteen years, during which the French 
 nation was almost constantly at war, and during which 
 we were subsidising half Europe to fight the great 
 Napoleon, that extraordinary man can fairly be said 
 to have actually carried into effect what is reported 
 to have been a great maxim of his — he " made war 
 support itself." He increased the French National 
 Debt by less than six million pounds, which sum we 
 
FRANCE 157 
 
 probably spend in one day at present to maintain 
 our independence as a nation and freedom as a 
 people. 
 
 The French are very thrifty, and there are few 
 French people who have not put by a sum of money 
 either for the purpose of giving their daughter a 
 wedding portion or of purchasing some " rentes " or 
 other securities. The steadiness of the French work- 
 men cannot fail to be a gain to her industries. By 
 the loss of Alsace-Lorraine to Prussia in 1871 the area 
 of her territory was diminished by 5,602 square miles, 
 much of which was an important mhiing and manu- 
 facturing part of France — part of that territory is 
 now reoccupied by French troops. 
 
 The view of a distinguished French depute, M. 
 Franklin Bouillon, is that the Franco-British entente 
 cordiale should be transformed into action cordiale 
 during times of peace, and all who wish well to both 
 countries will hope that ideal will be realised. There 
 would appear to be no nation in the world that has 
 more to gain by an increased and closer intercourse, 
 both on the grounds of commerce and friendship, with 
 Great Britain than France. 
 
 The recommendations of the Paris Conference which 
 was held by the Allies are of such importance that 
 it seems desirable here, in a work concerning the 
 economic conditions of our commercial interchange, 
 to refer to them at some length. They cover three 
 periods to which they refer — the war period, the re- 
 construction period in those countries or portions of 
 countries which have been in enemy occupation, and 
 the period after peace is declared. Important as they 
 are, I will not here refer to the two former periods, 
 
158 ALLIES IN PEACE AS WELL AS WAR 
 
 but will give the recommendations adopted by the 
 Paris Conference for the permanent measures to be 
 adopted by the Allies after peace is declared : 
 
 "The Allies decide to take the necessary steps 
 without delay to render themselves independent of the 
 enemy countries in so far as regards the raw materials 
 and manufactured articles essential to the normal 
 development of their economic activities. 
 
 "These measures should be directed to assuring 
 the independence of the Allies, not only so far as 
 concerns their sources of supply, but also as re- 
 gards their financial, commercial, and maritime 
 organisation. 
 
 " The Allies will adopt such measures as may seem 
 to them most suitable for the carrying out of this 
 resolution, according to the nature of the commodities, 
 and will have regard to the principles which govern 
 their economic policy. 
 
 " They may, for example, have recourse either to 
 enterprises subsidised, directed, or controlled by the 
 Governments themselves, or to the grant of financial 
 assistance for the encouragement of scientific and 
 technical research ; to Customs duties or prohibitions 
 of a temporary or permanent character ; or to a 
 combination of these different nielliods. 
 
 " Whatever may be the methods adopted, the object 
 aimed at by the Allies is to increase production 
 within their territories as a whole to a sufficient extent 
 to enable them to maintain and develop their economic 
 position and independence in relation to enemy 
 countries. 
 
 " In order to permit the interchange of their pro- 
 ducts the Allies undertake to adopt measures for 
 facilitating their mutual trade relations both by the 
 establishment of direct and rapid land and sea trans- 
 port services at low rates and by the extension and 
 
THE PARIS ECONOMIC CONFERENCE 159 
 
 improvement of postal, telegraphic, and other com- 
 munications. 
 
 " The Allies undertake to convene a meeting of 
 technical delegates to draw up measures for the 
 assimilation, so far as may be possible, of their laws 
 governing patents, indications of origin, and trade 
 marks. 
 
 " In regard to patents, trade marks, and literary 
 and artistic copyright which have come into existence 
 during the war in enemy countries, the Allies will 
 adopt, so far as possible, an identical procedure, to be 
 applied as soon as hostilities cease." 
 
 This procedure will be elaborated by the technical 
 delegates of the Allies. 
 
 " Whereas for the purposes of their common defence 
 against the enemy the Allied Powers have agreed to 
 adopt a common economic policy, on the lines laid 
 down in the resolutions which have been passed, and 
 whereas it is recognised that the ejffectiveness of this 
 policy depends absolutely upon these resolutions being 
 put into operation forthAvith, the representatives of 
 the Allied Governments undertake to recommend their 
 respective Governments to take without delay all the 
 measures, whether temporary or permanent, requisite 
 for giving full and complete effect to this policy forth- 
 with, and to communicate to each other the decisions 
 arrived at to attain that object." 
 
 No doubt the Paris Economic Conference has done 
 good work. Their task was by no means a light one, 
 practically to make suggestions to revolutionise trade 
 relations between their respective countries, and to 
 give an outline of the terms on which future economic 
 treaties could be based ; but, good as the resolutions 
 
160 ALLIES IN PEACE AS WELL AS WAR 
 
 are, until they are carried into effect they are merely 
 recorded pious opinions. Certain views of some public 
 men on this subject arc subjoined. Mr. Bonar Law 
 at a dinner given in June 1916 said : "I am certain 
 that these (the Paris Conference) resolutions will be 
 adopted not only by the present Government, but by 
 the present House of Commons, and that they may be 
 taken as representing the settled policy of the British 
 Government," whilst on June 26th, 1916, Mr. Asquith, 
 then Prime Minister, reptying to questions as to oppor- 
 tunities for discussing the resolutions, said : ''If 
 there is any general desire for such a discussion the 
 Government will endeavour to provide an early oppor- 
 tunity for it." And Lord Robert Cecil informed the 
 House of Commons, on July 13th, that the resolutions 
 passed at the Conference " have been confirmed by 
 the French Government." 
 
 On the other hand, in order to prevent any definite 
 action from being taken. Lord Beauchamp presided 
 last July at a meeting of members of both Houses, 
 when the following resolution was passed : 
 
 " That this meeting of Liberal members of both 
 Houses of Parliament records its firm adherence to 
 the principles of Free Trade and undertakes to offer 
 the most determined resistance to any proposals to 
 depart therefrom." 
 
 It is, however, not stated what number of members 
 were present or who they were. 
 
 Before anything can practically be done to carry 
 out these proposals, and before we attempt to com- 
 mence differentiating between our Allies, neutral 
 
THE "MOST FAVOURED NATION" CLAUSE 161 
 
 nations, and present enemies, we must denounce cer- 
 tain commercial treaties which contain " most 
 favoured nation " clauses. Those " most favoured 
 nation " clauses have hitherto done nothing to encour- 
 age our trade. One of the first of those treaties made 
 was between France and the United States as long 
 ago as 1778. The terms of the "most favoured 
 nation " clause in it are as follows : 
 
 "The Most Christian King and the United States 
 engage mutually not to grant any particular favours 
 to other nations, in respect of commerce and naviga- 
 tion, which shall not immediately become common to 
 the other party, who shall enjoy the same favour 
 freely, if the concession was freely made, or on allow- 
 ing the same compensation if the concession Avas con- 
 ditional." 
 
 Since the sixties all European States have given up 
 the standpoint of a conditional construction of a 
 " most favoured nation " clause — that is to say, that 
 all favours given to a third State are now given to any 
 State which has previously had a treaty made on a 
 "most favoured nation" basis. These concessions 
 are given without any compensation even though 
 secured by the first country in return for costly con- 
 cession. The real point to be considered to-day is 
 this i That no special reciprocal arrangements can be 
 made between the Allies until these treaties are de- 
 nounced, since until that is the case any concession 
 made would under it automatically become extended 
 to all other nations possesshig similar privileges. 
 
 It would, therefore, be better to denounce all 
 
162 ALLIES IN PEACE AS WELL AS WAR 
 
 treaties which hinder the development of our industry 
 or that of our Allies. If you have a building with an 
 unsatisfactory foundation, pull it down and build 
 another. You will not achieve the end in view, 
 namel}^ making equitable arrangements with other 
 nations, unless you make a fresh start and new treaties 
 to meet the altered conditions of international com.- 
 merce. France hated the Treaty of Frankfort, which 
 she has taken steps to denounce. Russia has already 
 done the same with regard to treaties that bound her 
 to Germany and Austria ; as a matter of fact they 
 were so drafted as to be diametrically opposed to the 
 commercial interests of the United Kingdom, and it 
 was said that Russia was a somewhat unwilling party 
 to that part of these treaties. 
 
 Referring to the European treaty system, it is im- 
 portant to notice that whilst in office last year Mr. 
 Runciman said in a speech which he delivered : " When 
 the war is over not one of those things will start off 
 in the same position as when the war began." 
 
 It is said that a certain place is paved with good 
 intentions. One must hope that these good resolu- 
 tions passed at the Paris Conference, excellent as they 
 are, will not be used for a similar purpose. One of 
 the chief evils that it is imperative to have remedied 
 is the attack on the " key industries " of Great 
 Britain and the Empire by what is known as the 
 German "dumping" practice. What is a "key 
 industry " ? some may ask. No clearer definition of 
 what it is could be given than the one which M. 
 Henri Hauser, corresponding member of the Listitute 
 of France, sent to the Morning Post in June 1916. 
 From it the following passages are extracted : 
 
KEY INDUSTRIES DEFINED 163 
 
 " Sir Hugh Bell, in his pamphlet on Trade after the 
 War, denies any value to the idea of a key industry. 
 This name is given, as everyone knows, to an industry 
 which allows a second to be derived from it. We 
 have seen during this war that the absence of certain 
 industries of a fundamental order has prevented the 
 pursuit in the same country of other industries which 
 utilise the products of the first class. How is it pos- 
 sible to make dyes or explosives when phenol cannot 
 be made and when no more of it reaches you from 
 abroad ? 
 
 " There are key industries, and the nation which 
 allows such industries to die out from its midst loses 
 the key which opens the door to others. Galvanised 
 iron has been an important English industry, says Sir 
 Hugh, and will be again, ' if it can be saved from its 
 friends.' Now to contend against the German in- 
 dustry is it not better to buy one's zinc more cheaply 
 than to pay high prices at Swansea ? 
 
 "So it seems. The manufacturer of iron-plates 
 believes that he is doing good business when he pro- 
 fits by the jjrices of zinc dumped in Swansea by the 
 German Cartel. He is pleased to think that he, an 
 Englishman, pays less for German zinc in England 
 than the Germans pay in their own country, and that 
 consequently he is able to make iron-plates less ex- 
 pensively than the factories in Diisseldorf. And this 
 is true for a certuih period — so long as the practice of 
 dumping is applied only to the production of zinc. 
 
 " But the time will come when, thanks to dumping, 
 the zinc industry will have disappeared from England. 
 Then the policy of the German Cartels will assume a 
 new aspect. The German manufacturer who buys 
 German zinc to make German iron-plates will con- 
 tinue to pay a few pfennigs more than his English 
 competitor, when his iron-plates are intended for 
 German customers. But when it becomes a question 
 
164 ALLIES IN PEACE AS WELL AS WAR 
 
 of German iron-plates intended for English custom 
 matters are arranged in the following way : The Zinc 
 Syndicate agrees to deliver to the Iron-plate Syndi- 
 cate a fixed quantity of zinc, no longer at the current 
 market price in Germany, but at the dumping prices 
 of Swansea, or even at a lower price. Consequently, 
 the iron-plate manufacturer at Diisseldorf will at last 
 be able to enter the English market as a competitor 
 of the English manufacturer of the same article. As 
 the Coke Syndicate, the Cast-iron Syndicate, and the 
 rest will have agreed to furnish him with the same 
 advantage, he will be able, when it may be necessary, 
 to lower his prices by several marks and drive the 
 English iron-plate trade out of the Swiss or Italian 
 markets. 
 
 " Gradually the English trade in galvanised iron 
 will be threatened, for the very reason that it has for 
 a long time previously imprudently profited by the 
 dumping prices of zinc. The zinc industry w^as a key 
 to the iron-plate industry, and the key has been trans- 
 ferred from Swansea to Diisseldorf. Galvanised iron- 
 plates, for instance, are used to make reservoirs for 
 rain water. German dumping allows English makers 
 of reservoirs to buy during a certain time their iron- 
 plates more cheaply than if they had been made in 
 England, and consequently to beat their German 
 rivals in the markets of the world, to sell them even in 
 Germany, All is for the best in the best of worlds 
 until the day when dumping shall have strangled in 
 England the trade of galvanised iron and when the 
 German Cartel of iron-plates allows the Cartel of 
 Reservoirs special exportation prices. Then the Ger- 
 man reservoirs sell in Spain more cheaply than the 
 English reservoirs. Then they will be sold more 
 cheaply in England itself, and so on. Every industry 
 is a key in relation to the industry immediately above 
 it in the scale of production. To lose one such key 
 
BIGOTED ''FKEE TRADERS" 165 
 
 means losing at once the means of opening the doors 
 of the floor above ; eventually it means losing the 
 keys of all the floors." 
 
 There are some exceedmgly bigoted manufacturers 
 in this country who use the words " free trade " as an 
 attempted answer to any argument regarding dump- 
 ing or any other question, as if those two words were 
 a sort of patent medicine of which they do not stop 
 to inquire the contents, but, finding it gives them tem- 
 porary relief, are perfectly indifferent as to whether 
 it does them a permanent injurj^ or not. The expres- 
 sion " free trade " has that soothing effect upon them 
 that the blessed word " Mesopotamia " is supposed to 
 have had on the old woman — though whether even 
 that word would have the same effect during the last 
 year or two is more than doubtful, if she were of 
 British birth and had relatives at the front in that 
 country ! If one attempts to point out to them the 
 evil of the destruction of our key industries they 
 stubbornly refuse to understand. It is not because 
 they cannot see, but their selfishness, and one may 
 add their shortsightedness, is so great that they ivoji't 
 see. 
 
 To refer to the instance quoted by M. Hauser 
 which has been previously given, so long as they get zinc 
 under a fair market price for that commodity, and 
 make a large profit, what care they if the zinc industry 
 is ruined ? If any of these obstinate " Free Traders," 
 as they call themselves, have ever studied the ques- 
 tion, which one doubts, they would know that this is 
 against their pet doctrine, as Free Trade, which we were 
 told was the " design of nature," was to buy goods at 
 
166 ALLIES IN PEACE AS WELL AS WAR 
 
 their natural price in the country in which they were 
 produced or manufactured, not foreign goods sold 
 there under their market price by means of a bounty 
 or other artifices. When, however, the tin-plate 
 manufacturers, as has been shown, were attacked, and 
 their business ruined by the same insidious plan, the 
 purchaser of the tin-plates was in turn attacked and 
 his industries undermined by the same process. His 
 eyes were then opened to the iniquity of the plan, and 
 so, in succession, industry after industry is destroyed 
 after the key product to their manufacture is first 
 undermined and then ruined. 
 
 It is sometimes well to look at our economic posi- 
 tion with the eyes of others, more especially when they 
 are those of a great statesman of a friendly Power ; 
 in other words, it is well to do as Burns said, "see 
 oorsells as ithers see us." M. Thiers, when he was 
 the distinguished President of the French Republic, 
 said on one occasion : 
 
 " What was needed to make Holland, which gives 
 laws to France, descend from her loft}^ position ? It 
 only needed fifty years. It only needed a Navigation 
 Act in England and a Colbert in France. God forbid 
 that I should predict for England such a destiny ; but 
 I repeat it : her existence, which depends on con- 
 sumers which she seeks everywhere outside herself, is 
 less solid than that of France who has her consumers 
 within her own bosom." 
 
 France has never been a Free Trade country. Her 
 protective tariff of 1892 has not increased the price of 
 living in that country, and since it came into force it 
 has, on the contrary, diminished the cost of the whole- 
 sale price of bread as muchasfourteenper cent., whilst 
 
BOUNDLESS RESOURCES OF RUSSIA 167 
 meat has decreased in price five per cent. Wages, on 
 the other hand, are ten per cent, in excess over their 
 previous level, and the capital in French savings 
 banks is greater. 
 
 It is rather noticeable that whilst in the United 
 Kingdom we raise revenue mainly by means of direct 
 taxes, such as income tax and death duties, in France, 
 one finds, in examining their budget for the years 1911- 
 1913, that whilst the direct taxation was under twenty- 
 five millions, out of their total revenue of one hundred 
 and eighty-nine and a half millions three items alone 
 of indirect taxation — customs, miscellaneous, and sugar 
 — account for no less than fifty- five and a half millions 
 of revenue. 
 
 The commercial possibilities of Russia after the war 
 is a question which should be carefully considered. 
 Russia is a huge country occupying one-sixth of the 
 earth, with a population of one hundred and seventy- 
 three millions, chiefly occupied in agriculture. The 
 last-mentioned fact can be appreciated when it is 
 stated that she has under cultivation in cereals, 
 potatoes, etc., the enormous area of three hundred 
 and sixty-one million acres. Two of the larger cities, 
 Petrograd and Moscow, contain, the former two million 
 inhabitants and the latter about half a million less. 
 Her resources in mineral and other wealth are very 
 great, and include gold, platinum, silver, copper, iron 
 of a very superior quality, lead, coal in apparently 
 inexhaustible supply, oil fields of excellent naphtha, 
 splendid harbours, immense rivers, nearly forty-seven 
 million miles of railways, and an important and growing 
 manufacturing interest. Of the exports of the United 
 Kingdom in 1914 she took products of the value of 
 13 
 
168 ALLIES IN PEACE AS WELL AS WAR 
 
 fourteen and a half million pounds sterling, of which 
 machinery was the principal of our manufactures, coal 
 and manufactured metals being the next two in order 
 of value. 
 
 From Russia we imported goods and products to the 
 value of twenty -eight millions, which included timber, 
 corn and grain, butter, hides, flax, and eggs, and others 
 to a smaller extent. The Russian import tariff is by no 
 means a light one, and there is no doubt that if mutual 
 preferential and discriminating duties were arranged 
 between the United Kingdom and Russia a very much 
 larger interchange of commodities between those two 
 great countries would be the result. 
 
 It makes one pause to think that His Majesty the 
 King, and the Emperor of Russia — two cousins — are 
 rulers over six hundred and eight millions of the human 
 race. The good feeling between the Russian and 
 British people at the present time is very thorough. 
 An English friend of the writer's who was on duty 
 in Russia last summer told him, on his return to Eng- 
 land, that ho never saw anything like the enthusiasm 
 with which the English are now received in the 
 Russian Empire. Their kindness of the Russians, he 
 said, was almost too pressing, and he himself had 
 slightly suffered from a plethora of good dinners and 
 high living. 
 
 In conversation, also, last October with two of our 
 wounded soldiers, returned prisoners of war from 
 Germany, each of whom had lost a leg, one learnt that 
 the camaraderie and friendliness of the Russian pri- 
 soners of war in Germany to the British soldiers in 
 the same unfortunate circumstance were very marked 
 indeed. 
 
HOW TO ENCOURAGE OUR COMMERCE 169 
 
 In order further to encourage our trade with Russia, 
 our commercial travellers should be better equipped, 
 and should have a knowledge of the Russian language, 
 which one gathers is by no means so difficult to acquire 
 as some people imagine. We should study the cus- 
 toms and requirements of the Russian people and 
 supply them with exactly what they require, not 
 with what we wish to sell. Our business circulars 
 should be in Russian with prices, measurements, etc., 
 in local equivalents. The German travellers are 
 much more up-to-date in their methods of discovering 
 the financial soundness of their customers and in 
 cases where they do not represent firms selling similar 
 goods they are said to assist one another most will- 
 ingly with any knowledge they acquire. 
 
 Our Consular Service in Russia requires strengthen- 
 ing. It only consists at present, according to recent 
 returns, of thirteen paid British Consuls — that is to 
 say, only two more than are appointed to another of 
 our Allies, namely Portugal, which has a population 
 eighteen times less than that of the Russian Empire. 
 
 It has been mentioned that their import tariff is by 
 no means a light one, and that statement would appear 
 to be justified by giving the following items taken from 
 our official Blue book on this subject. Under the 
 heading of woven manufactures appears the fact that 
 cotton velvets and plush have to pay on entering 
 Russia a duty of 2^. 6|c?. per lb., whilst for the same 
 weight cotton tulle for curtains is charged 4^. S^d, 
 And on made-up women's clothing the duty in that 
 country is 9^. 4Jc?. 
 
 Turning to other of our manufactures, of which we 
 Bell a considerable amount to Russians, rails of steel 
 
170 ALLIES IN PEACE AS WELL AS WAR 
 
 or iron, perforated or not, have to pay per hundred- 
 weight 5s. lid., whilst steel or iron wire pays according 
 to gauge, the finer descriptions being charged the 
 heavier duty, which is per hundredweight from Us. lOd. 
 up to £1 105. lO^d. From a long list these duties are 
 simply taken as examples, and one could continue 
 quoting many others of a somewhat similar amount 
 ad infinitum. 
 
 By one of the most recent reports available issued by 
 the Foreign Office and the Board of Trade one finds 
 that the development of Russian industries may be 
 gauged by the fact that the output of fuel during the 
 first nine months of 1913, the last complete year before 
 the war commenced, had grown to about thirty million 
 tons as compared with twenty-five million tons during 
 the same period of 1912. Notwithstanding this remark- 
 able increase in the consumption of fuel, it is estimated 
 that the demand exceeded the supply by over two and a 
 half million tons. 
 
 As in America and elsewhere there is a strong feeling 
 
 in Russia against syndicates and combines, and the 
 
 Ministry of Trade and Industry has been approached 
 
 by a variety of interested parties for protection against 
 
 them. The Ministry is now considering the advisability 
 
 of prohibiting trusts, etc., formed without the express 
 
 sanction of the Government. One item of export that 
 
 strikes one as remarkable in regard to the amount sent 
 
 by Russia to other countries is that of eggs, of which 
 
 in 1913 they exported to the value of about nine and a 
 
 half millions, or an increase of half a million pounds 
 
 sterling in value over that of 1912. The United 
 
 Kingdom purchased 53*3 per cent, of this total, and 
 
 Germany 46*3. Compared with the total import trade 
 
AGRICULTURE IN RUSSIA 171 
 
 of Russia, the share falling to the United Kingdom 
 in 1913 was only 13*9 per cent, as against 13*5 in 
 the previous year, whilst in the same years Germany's 
 share had mounted up from 50*1 per cent, in 1912 
 to 52' 7 per cent. 
 
 The naphtha industry in Russia practically started 
 in 1870, the principal oilfield being situated in the 
 Baku region, where there are 182 firms working the 
 oil from 3,142 wells. Of the total output fourteen per 
 cent, was obtained from oil fountains. 
 
 In Russia they have an institution called " The 
 Peasants' Land Bank " to assist them in purchasing 
 their land by loans advanced from the bank. The 
 aggregate acreage dealt with by the Land Bank during 
 the year 1913 was in excess of three and a half million 
 acres. They advanced 93*5 per cent, of the sale price, 
 so that the peasant purchaser was onlj^ obliged to pay 
 6' 5 per cent, in cash. 
 
 The State in Russia appears to do everything in its 
 power to assist the agricultural interest, and has 
 supplied monej^ for the construction of grain elevators 
 in the most important agricultural districts of Russia, 
 while during the year referred to above a sum of about 
 £1,300,000 was assigned for that purpose. 
 
 Siberia has always been looked upon by most of us 
 as an Ultima Thule, a place where people were sent 
 into exile and had to traverse dreary wastes and climb 
 snow-clad mountains to get to their destination ; but 
 one finds in reality that it is a country to which, far 
 from its being considered uninhabitable, the emigration 
 of peasants from Russia proper continues to grow 
 steadily. No less than three hundred and twenty-seven 
 thousand crossed the Urals to Siberia in 1913, as 
 
172 ALLIES IN PEACE AS WELL AS WAR 
 
 compared with two hundred and fifty-nine thousand 
 in 1912. The number of emigrants returning to their 
 former homes has also fallen considerably. 
 
 The majority of emigrants settle in the province of 
 Tomsk, on land belonging to the Imperial Cabinet and 
 to the State ; others go to the Far East, and a few to 
 Turkestan. Advances to the emigrants for procuring 
 materials for building dwellings, etc., were made by 
 the State to the extent of about seven hundred and 
 fifty thousand pounds in 1913. The number of depots 
 containing agricultural implements, machinery, etc., 
 for assisting settlers has increased. Besides these the 
 Emigration Department controls saw-mills in certain 
 districts for providing timber on easy terms, and also 
 a number of shops where emigrants may purchase 
 their stores at the lowest rates. 
 
 The area allotted to emigrants during last year 
 amounted to nearly three million acres. New roads 
 aggregating one thousand two hundred miles were 
 commenced, some one thousand five hundred miles 
 were completed, surveying for over two thousand 
 five hundred miles of new roads was carried out, 
 and five thousand miles of old roads were repaired and 
 attended to during 1913. During the same period 
 one thousand nine hundred new wells were con- 
 structed for providing water for new settlers, besides 
 reservoirs. 
 
 Whilst Eussia possesses a parliament called a Duma, 
 she is more under an autocratic form of Government 
 than is the case in Great Britain, and whilst naturally 
 one has a greater admiration for our form of Govern- 
 ment in theory, one is forced to admit that the Russian 
 system can carry out useful and practical reforms in 
 
RUSSIAN TRADE PROSPECTS 173 
 
 certain directions with greater celerity and ease than 
 are possible here. 
 
 Before the war commenced we do not appear to have 
 been gaining, so far as our shipping was concerned, at 
 the port of Petrograd-Cronstadt, for in the year 1911 
 our gross tonnage was 22* 1 of the whole at that port, 
 whilst the German was 17*5. In 1913 theirs had 
 increased to eighteen per cent, and ours had decreased to 
 20*5. In that year Germany sent into Russia goods to 
 the value of 643 million roubles. The United Kingdom 
 came next in the list of exporters to that country with 
 only 170 million roubles to her credit. 
 
 Regarding timber, which is so much in demand here 
 for paper, etc., the stock of the Urals has been little 
 exploited, with the exception of that in the immediate 
 vicinity of the mining works, where it has been felled 
 for local uses. New railways in course of construction 
 and others which it is proposed to construct will 
 greatly facilitate the exploitation of regions hitherto 
 inaccessible for export trade. 
 
 The following are extracts from the most recent 
 Consular Report issued by our Foreign Office which 
 appear to be well worthy of consideration and adoption. 
 Do they not in detail emphasise the words, '' Wake up, 
 England ! " used in a speech some years ago by an 
 august personage. 
 
 " In view of the large trade in Russia in ploughs, 
 threshers, seeders, and other agricultural machinery and 
 implements there should be a great opening for British 
 manufacturers. British firms would do well to send 
 out representatives with a thorough knowledge of 
 Russian, to study requirements on the spot, so that 
 the United Kingdom may be able to step in and meet 
 
174 ALLIES IN PEACE AS WELL AS WAR 
 
 the demand for goods which have been supplied by 
 Germany. In the case of machinery these envoys of 
 commerce should have an intimate acquaintance with 
 the machines which it is their object to introduce, and 
 should be possessed of the expert knowledge and 
 technical training necessary to enable them to grasp 
 at once, and apply practically, the modifications 
 demanded by local conditions or local preferences. 
 
 " With the exception of pulp and rags, the paper mills 
 of Kussia are mainly dependent on import for the 
 material used in the manufacture of paper. I under- 
 stand that so far the greater part of this other material 
 has been imported from Germany or by German firms, 
 the conditions of sale granted by that country as to 
 price, credit, and delivery being more advantageous 
 than those conceded by other countries. But British 
 goods could enter the field with good prospects of 
 success, if competent salesmen knowing the language 
 were to offer the goods c.i.f. Riga, and British firms 
 were prepared to give sufficient credit, and to offer 
 business on sufficiently favourable terms. The ques- 
 tion of credit must, of course, be left to the discretion 
 of the individual merchants, but it may not be super- 
 fluous to repeat in parenthesis an observation made 
 in many previous Consular reports, viz. that the 
 success of German trade in this country has been 
 largety due to its system of extended credits. The 
 goods in question which have hitherto come from 
 Germany are wire-cloth and felts for paper-making 
 machinery, dyes, and machinery of every kind used in 
 paper making. 
 
 "The china-clay trade, which is a very extensive 
 one, as this substance is required in so many industries, 
 has been largely monopolised by a German firm at 
 Diisseldorf . I am informed that this firm has contracts 
 to purchase the output of all china-clay works in certain 
 countries abroad, and delivers the clay in Russia to the 
 
ADVANTAGE OF ADAPTABILITY IN TRADE 175 
 
 various mills from its warehouses in Russian ports 
 according as the demand arises. 
 
 " It is the great adaptability of the German merchant 
 and agent to local conditions which has enabled him to 
 obtain such a footing, but now and after the termina- 
 tion of the war every chance should be in favour of 
 his competitors. In wire-cloth, felts, and machinery 
 Sweden is beginning a trade, and has, thanks to her 
 geographical position and the intelligence of her mer- 
 chants, great chances of success. British manufac- 
 turers should take note of the present opportunity.'* 
 
 It should also be realised by British firms that the 
 opportunity offered by the war to capture Germany's 
 share of the import trade to Russia is one which it 
 would be foolish to disregard. The volume and variety 
 of manufactured goods hitherto supplied by German 
 firms to this country are immense, and it is quite im- 
 possible to enumerate all the different classes and sub- 
 classes of goods in which Germany holds the field. 
 Her position as Russia's nearest neighbour, her com- 
 mercial enterprise, her extreme adaptability, and the 
 study she has made of Russian markets have all 
 contributed to secure for her the commercial position 
 which she has held in this country. It is satisfactory 
 to learn that an organised effort is being made in the 
 United Kingdom to profit by the present opportunity, 
 and it may be hoped that the great field for enterprise 
 offered by this country will not be neglected by British 
 manufacturers and merchants. 
 
 The Government of Russia was during the autumn 
 of 1913 doing whatever it could to encourage the 
 importation of coal from abroad for the needs of the 
 State and private railways, and to that end had 
 
176 ALLIES IN PEACE AS WELL AS WAR 
 
 authorised the duty-free purchase of coal for the use 
 of various railway companies. 
 
 Before concluding this necessarily brief sketch of the 
 trend of our future economic policy with the great 
 Empire of Russia a few words on its political life during 
 more recent reigns might be not only interesting, but 
 very much indeed to the point. 
 
 During the reign of Alexander II of Russia, German 
 influence, manners, and customs were powerful, and 
 much in vogue at the Russian Court. That Emperor 
 himself was a staunch admirer of the Hohenzollern 
 dynasty of Prussia, whose interests he did all in his 
 power to support, with the result that he permeated 
 Russia with Germanic influences in all directions, much 
 to the chagrin of the thoroughly nationalist Russians 
 in his own dominions. 
 
 His successor, Alexander III, followed in his foot- 
 steps in this direction, though with more caution, and 
 being a man of very broad views had probably less 
 sympathy with the barrack-square Prussian ideal of 
 administration. The Emperor was at heart first and 
 foremost a Russian. 
 
 In the middle of the eighties, just when Bismarck 
 was once more drawing the Russian diplomacy into 
 Germany's orbit, the first German military and financial 
 mission went to Turkey. Early in the nineties the 
 foundation of the German domination was laid at the 
 Bosphorus. The policy of the Berlin Government 
 towards Russia underwent a radical change. After 
 the unification of Germany, weak Prussia needed strong 
 Russia to protect her, and also wanted her aid in her 
 aims of aggrandisement ; but when she attained her 
 end in consequence of the unselfish services of Russia, 
 
PRUSSIAN INTRIGUE DEFEATED 177 
 
 and Prussia had absorbed and assimilated Germany, 
 she wanted her late protector to become her satellite. 
 In furtherance of that object German colonisation in 
 Russian Poland and elsewhere in that country was 
 commenced on a large scale. German syndicates set 
 to work to buy land in Russia and Poland, and after- 
 wards in Western and Southern Russia, and the extent 
 of that pacific invasion is still to some extent, or was 
 still prior to the war, felt in Russia. 
 
 Alexander III was the first quite national Emperor 
 of Russia, and could be regarded as the founder of a new 
 and purely national Russian dynasty. Under the rule 
 of the present Emperor Nicholas II it is considered by 
 the best Russian authorities that the German chan- 
 cellories have spared no effort to weaken Russia by 
 trying to thrust her into hazardous and disastrous 
 undertakings, and, according to Wesselitzky, in his in- 
 teresting short treatise entitled Russia and Democracy : 
 
 *' During the South African War the Berlin Cabinet 
 and the Emperor William himself strained every nerve 
 to form a coalition against Great Britain. The pro- 
 nounced friendliness of the Emperor Nicholas towards 
 the latter disconcerted their schemes." 
 
 The systematic colonisation previously mentioned 
 and the pacific commercial penetration of Russia by 
 the Germans was renewed later with increased energy, 
 and was hurriedly pushed forward, more especially in 
 the frontier provinces. The greatest progress was 
 made in the Vistulian district, in Poland, in the Baltic 
 provinces, and in South- Western Russia. The alien 
 emigrants of these districts have recently proved 
 willing to serve in the field against Russia, and indeed 
 
178 ALLIES IN PEACE AS WELL AS WAR 
 
 large numbers of them are doing so, whether they were 
 nominally naturalised Eussian subjects or not. 
 
 They are said to furnish the best spies of that corps 
 of German spies and paid emissaries with which every 
 country in the world has been cursed, more especially 
 during the recent initial period when German}^, at the 
 instigation of Prussia, was preparing to spring from 
 her lair like a panther, attack and destroy the other 
 European nations, and place her War Lord and Ger- 
 many supreme " iiber alles." German schools were 
 started in various parts of Russia, and were, as a matter 
 of fact, fortresses to further the ends of the Fatherland. 
 
 All these attacks on Russian nationality were re- 
 sented by the Slavophiles, who fought as hard as they 
 could to liberate their country from the German yoke. 
 The present Emperor is a devoted advocate of peace, 
 as strong in that respect as his deceased relative our 
 late King Edward VII, and it was at the instigation 
 of the former that the Conference at the Hague was held 
 and the various rules drawn up respecting arbitration 
 (or the way in which war, if it arose, should be con- 
 ducted), rules which, during recent hostilities, have 
 been more honoured by the Germans in the breach 
 than in the observance. 
 
 As there has recently been some attention regarding 
 the village commune or " Mir," and as that is an 
 important Russian institution, it may be interesting 
 to remind the reader what it actually was and how it 
 has been changed. 
 
 The system is that all male peasants in every part 
 of the Empire are inscribed in census lists, which form 
 the basis of direct taxation. These lists are revised 
 at regular intervals, and all males alive at the time of 
 
RUSSIAN ^'MIR" SYSTEM 179 
 
 the revision, from the new-born babe to the centenarian, 
 are duly inscribed. Each commune has a list of this 
 kind, and pays to the Government an annual sum 
 proportionate to the number of names which the list 
 contains. During the interval between the revisions, 
 the financial authorities take no notice of the births 
 and deaths. A commune which has a hundred male 
 members at the time of the revision may have in a few 
 years considerably more or considerably less than that 
 number, but it has to pay taxes for a hundred members 
 all the same, until a new revision is made for the whole 
 Empire. 
 
 The payment of taxes is inseparably connected with 
 the possession of the land, whilst at the same time they 
 are neither paid as the rent of the land nor as a land 
 tax, for in Russia the members of one commune may 
 possess six acres and those of a neighbouring one 
 seven, and yet the taxes may be identically the same — 
 the fact being that the taxes are simply personal, and 
 are calculated according to the number of " souls " 
 inscribed in the communal lists at the time of the 
 revision. 
 
 Each commune has the power to distribute the land 
 as it sees fit, and as a rule it allots the land in the 
 number of shares corresponding to the number of 
 individuals in each family ; and as receiving a share 
 makes it obligatory to pay the tax in many communes, 
 the shares are allotted and reallotted in accordance 
 with the number of able-bodied adults there are in 
 each family. In Russia the possession of a share of 
 communal land is often not a privilege, but a burden. 
 Naturally, owing to deaths and a variety of other 
 reasons, the working powers of the several families in 
 
180 ALLIES IN PEACE AS WELL AS WAR 
 
 the village commune change ; hence there are often 
 independent reallotments of the land made by the 
 commune itself, besides the general Government re- 
 vision, which occurs on the average once in about 
 fifteen years. This village commune is governed, as 
 we should term it, by local sc4f-government of a most 
 democratic character. The elder merely represents 
 the executive power, whilst all real authority resides in 
 the assembly, of which all the heads of households are 
 members. 
 
 The commune, it must be remembered, was not 
 abolished by recent legislation. Its members were 
 only allowed to choose between remaining in it or 
 becoming individual landowners. The power to hold 
 his own land and become transformed into an in- 
 dividual working unit has commended itself very much 
 to the Russian peasants, and they are eagerly buying 
 up the goodwill of their land aided by advances from 
 the State. It is estimated that in due course eighty 
 per cent, of the communal land will be thus dealt with. 
 
 The colonisation of Siberia is also, as has been 
 incidentally mentioned, proceeding apace, and from 
 European Russia alone there have been half a milHon 
 new settlers ; but one of the most important matters that 
 has occurred during the second period of the present 
 reign has been the marked rapprochement of Russia 
 to France and England. Nicholas II is carrying to 
 completion the work indicated by Peter the Great of 
 a firm alliance with France and England, which may 
 be called that great monarch's unwritten testament. 
 
 The Russian Government has been very patient with 
 German arrogance during the last few years. She 
 outwardly bore with patience the Kaiser's boastings 
 
RUSSIA STOPS SALE OF ALCOHOL 181 
 
 about Germany's " shining armour," also the entirely 
 one-sided arrangement of 1911 by which Russia recog- 
 nised the Bagdad Line as a German Government 
 undertaking. She also looked on quietly during the 
 creation of the State of Albania and the exclusion of 
 Serbia from the Adriatic, both of which were directly 
 due to Germanic influences, and were the direct cause 
 of the second war between the Balkan Powers. 
 
 One of the most remarkable revolutions that have 
 occurred in regard to social reform in any country has 
 been the heroic action of the Russian Government in 
 abolishing the sale of all alcoholic drinks in that country 
 since the present war commenced ; despite the fact 
 that money for warlike purposes was urgently required, 
 she took that drastic step which many prophesied 
 would lose her millions of money per year to her 
 revenue. Contrary to such expectations, the taxes 
 did not drop after this change, but rose considerably, 
 and the productiveness of the people is said to have 
 increased thirty or forty per cent., whilst their savings 
 placed in the bank were in excess in 1914 over those of 
 the previous year by no less a sum than two million 
 eight hundred thousand-odd pounds. The standard of 
 living has also been raised in Russia. That Empire is, 
 in truth, a democratic monarchy. Her subjects have 
 shown the greatest loyalty throughout this war, and 
 have never been more thoroughly united. They are 
 determined to liberate the Slavs and to solve the 
 question of Russia's access to an open sea at some 
 future date. Under the wise leadership of the great 
 Slavic Czar this union of democracy has been accom- 
 plished. Mr. Lloyd George, who is a master in sum- 
 ming up in a few clear words the whole substance of a 
 
182 ALLIES IN PEACE AS WELL AS WAR 
 
 question, stated at Bangor in 1915 that he doubted if 
 Russia ever made an aggressive war on her European 
 neighbours, and that " Russia desired above everything 
 peace ; she wanted peace, she needed peace, she would 
 have had peace had she been left alone." She was, in 
 fact, at the beginning of a great industrial development 
 when the war broke out, and she wanted peace to bring 
 about its fruition, also to eradicate from Russia as far 
 as possible all traces of German penetration. 
 
 One of the most popular recent acts of the Russian 
 Government has been the russification of the name of 
 the capital to the word " Petrograd." This appears 
 to indicate the end of the German domination in Russia, 
 and the beginning of a Russian period of history, and 
 efforts are being made, which it is to be hoped will 
 continue both now and after the war, to knit both 
 fronts of the Grand Alliance, the Eastern and the 
 Western, as a safeguard both for their material pros- 
 perity and for the fviture peace of Europe, 
 
 According to the old Japanese mode of reckoning, 
 1914 was the Year of the Tiger, which should according 
 to superstition have been a year of tragedy and disaster. 
 This has proved to a great extent to be the case. It 
 commenced with a volcanic eruption of some magnitude 
 at a place called Sukurajima in the south of Japan. 
 Her Majesty the Empress-Dowager passed away in the 
 spring, plunging the whole nation into mourning. The 
 Cabinet fell later on, certain scandals to some degree 
 contributing to that event. In the early summer the 
 failure of a large bank brought about a feeling of 
 uneasiness, and in August Japan joined her Ally Great 
 Britain and declared war on Germany. 
 
 One of the great difficulties Japan has experienced 
 
JAPAN SUPPORTS HOME INDUSTRIES 183 
 
 since the war commenced has been the lack of shipping 
 facilities. She had exceptional demands for wheat and 
 bran from Australia, for oats and barley from Europe, 
 and, needless to say, for warlike stores from Russia 
 and elsewhere. Maize was required on the Pacific 
 coast. In fact, increased demands were made in all 
 directions for her produce and manufactures except 
 in regard to silk. The tilling of the land is held in 
 the highest honour in Japan, and doubtless many 
 Japanese are at a loss to understand how any great 
 nation can treat agriculture as a Cinderella amongst 
 industries and prosper. Rice has been from the 
 earliest ages in Japanese history one of their great 
 staple products of agricultural industry, but until the 
 latter years of last century no appreciable quantity of 
 it was exported to foreign climes. At one time its 
 being sent from Japan was absolutely prohibited, 
 owing to the fear that the drain of rice from the country 
 might cause a famine. In the year 1914 one finds that 
 the United Kingdom still remained at the head of the 
 list of those countries which supply Japan with ma- 
 chinery. There are some important points which 
 should be borne in mind ; one is that the Government 
 Departments which encourage the policy of supporting 
 home industries place their orders in Japan whenever 
 they can possibly do so. That has always been the 
 policy of the Japanese, so in the last great war in which 
 they were involved as much as seventy per cent, of their 
 war outlay is said to have been spent at home, and in 
 consequence there are many examples of struggling 
 industries which were built uj? into successful concerns 
 by the large demands made on their capacity. 
 
 Another thing to be remembered is that Japanese 
 14 
 
184 ALLIES IN PEACE AS WELL AS WAR 
 
 engineering works are increasing in number and 
 capacity. Of course, if it were not for the heavy 
 duties, it would be impossible for them to compete in 
 many lines with our manufactures, but the duty and 
 the freight give them a big advantage which enable 
 them to come fairly near British prices, and it is sug- 
 gested that the makers of British machinery will have 
 to consider whether it would not pay them to ship only 
 the small delicate parts and have the heavy castings 
 made locally, thus saving the duty and freight on the 
 latter. That suggestion is made by the Foreign Office 
 here, and it is only one instance of the result of a high 
 tariff in a foreign country possibly causing unemploy- 
 ment amongst the working-classes here. 
 
 One of the interesting features of engineering work 
 in Japan is the large number of very small establish- 
 ments in existence — places which appear in engineering 
 directories as " So-and-So's Engineering or Ironworks," 
 but which really consist of a workshop with one lathe 
 and two or three hands. They have no establishment 
 charges, they work for a very small profit, and conse- 
 quently they are able, in tendering for Government 
 work, to put in exceedingly low prices. They do not 
 quote direct, they are too small to do that, but a sort 
 of broker takes the contract from the Arsenal or other 
 department and then sub-lets it to these different 
 works. As they are on such a small scale there is a 
 good deal of irregularity in the output, and the per- 
 centage of rejections is large, but none the less com- 
 petition from such works is very severe. 
 
 There is no doubt that the trade of Japan will expand 
 as the years roll on, and that she will become a greater 
 competitor for the trade of the various other nations of 
 
PROGRESS IN JAPAN 185 
 
 the world, more especially that of China. The trade 
 to China from Japan is a growing one, and the mer- 
 chants of the latter country have many advantages. 
 They understand thoroughly the customs of the 
 Chinese ; they usually know not only the writing but 
 also one of the colloquial languages of the Celestial 
 Kingdom, and they have not only the advantage of 
 propinquity, but they have also several steamship lines 
 of their own running large and sAvift steamers regularly 
 to the ports of China. These steamers also run to 
 Hong-Kong, Manila, Singapore and Saigon, and to the 
 Japanese Islands, and, of course, there are large lines 
 running to Europe and America. 
 
 The imports from the United Kingdom in 1914 were 
 valued at fourteen and a half million pounds sterling. 
 The chief in importance were iron and steel and 
 machinery. Of woollens we sent more than nine 
 hundred pounds' worth. Other articles of commerce 
 were cotters, manures, chemicals, wool, arms and 
 ammunition. 
 
 The soil of this country is very productive and grows 
 every variety of agricultural produce. Minerals are 
 extensively found throughout the Islands, and include 
 copper, iron, lead, antimony, sulphur, and zinc. Gold 
 and silver are also found in the Island of Sado. The 
 chief manufactures are silk and cotton. Fruit is 
 abundant. The Japanese are introducing from Europe 
 apples, pears, strawberries, peaches, grapes, and figs. 
 The area of the country is about two hundred and six 
 thousand square miles, and the Islands of Japan proper 
 contain a population of about fifty-three millions, 
 whilst, with Korea and their other outside Dominions, 
 the total population exceeds sixty-seven millions. 
 
183 ALLIES IN PEACE AS WELL AS WAR 
 
 The export trade from Japan to the United Kingdom 
 was just before the war about £4,300,000 in vahie, and 
 was chiefly composed of silk goods, straw plaiting, 
 un wrought copper, oil, fish, porcelain, and seed. 
 
 As Great Britain has decided to adopt a form of 
 conscription to meet the requirements of this war, of 
 all males between the ages of nineteen and forty-one, 
 with certain limited exceptions, it might be interesting 
 to note that, after the abolition of the long-rooted 
 feudal system in Japan of 1873, conscription was 
 introduced there, and contrary to the opinion of 
 foreigners it was successful, and worked remarkably 
 easily and perfectly from the start. This bold ex- 
 periment has not only given to Japan a large standing 
 army which can be expanded without difficulty or 
 confusion in time of need to include all the vigorous 
 manhood in the country, but in no sense has the 
 Imperial army there deteriorated from the high 
 standard of courage, devotion, and discipline of the old 
 Samurai levies.^ 
 
 Certain schemes are now in the air in this country 
 for the framing of a Constitution for the United Empire, 
 a subject presenting great possibilities, and also great 
 
 1 Compulsory Military Service came into force in Great Britain 
 in the spring of 1916. The requirements of the case rendered it 
 needful. During the spring and summer of 1915 the author of this 
 work was in the recruiting service, and as a recruiting Staff Officer 
 had charge of a large district in the London Command. The re- 
 cruiting was then on the voluntary system, and amongst the recruits 
 who presented themselves to be attested were men who had come 
 as far as from the Argentine and South Africa to join the Colours ; 
 two of them said that they had been clerks in an office in Buenos 
 Ayres in which there were also several German clerks, and that these 
 Teutons had received mobilisation orders to return to Germany and 
 rejoin their regiments in June 19U, which they had obeyed— this 
 
THE JAPANESE CONSTITUTION 187 
 
 difSculties which one trusts mp^y in due course be 
 surmounted, and on this topic Lord Milner and many of 
 the leading statesmen of the Mother Country and the 
 Dominions expressed their views at a conference held at 
 the House of Commons. It may be interesting here 
 to note the steps which were taken in Japan to frame 
 the Constitution which came into force in the last 
 decade of 1900, and which has, on the whole, worked 
 smoothly both in times of peace and in times of war. 
 To Marquis Hirobumi Ito was confided the arduous 
 and difficult task of framing a draft of the new Japanese 
 Constitution. He set about this herculean task in a 
 very practical and systematic manner, and spent much 
 time abroad studying the constitutions of various 
 countries. His difficulty was increased by the fact 
 that his country had always been a non-constitutional 
 one, and that he had to erect on the debris of its past 
 history and old-world customs, and prepare, a con- 
 stitution adapted to the modern requirements of Japan. 
 He had further to remember that his was intended as a 
 permanent measure, and it was necessary, therefore, 
 to examine all the possible effects which were likely to 
 
 prior to the assassination of the Archduke Ferdinand of Austria. 
 This clearly shows that the pretext of his murder for attacking 
 Serbia made by the Austrians was merely an excuse, and that thia 
 war had been premeditated and certainly determined on in Berlin 
 in the spring of 1914, if not long before. 
 
 In the autumn of 1915 a sort of half-way house or compromise 
 was attempted. This particular recruiting scheme was about as 
 easy to carry out as the mixing of oil and water, since it involved 
 the attempted fusion of voluntarism and compulsion. Recruits 
 however, flowed in, and recruiting occasionally extended far into the 
 night. It could only, however, be a sort of makeshift, and was at 
 length succeeded by an excellent and thoroughly workable system 
 of compulsory service. 
 
188 ALLIES IN PEACE AS WELL AS WAR 
 
 arise from it in the distant future, and to keep clearly 
 before his eyes that it was absolutely essential to 
 safeguard the traditional rights of the Sovereign. 
 When, in July 1912, H.I.M. the late Emperor of Japan 
 died, Marquis Hirobumi Ito was so afflicted with grief 
 that he committed suicide, or harikari, in the Japanese 
 manner. 
 
 The Constitution thus created relied on the Sovereign 
 of the State as the sheet-anchor to prevent the bark of 
 State from drifting into difficult and dangerous waters. 
 It is interesting to note that in some respects the 
 Constitution given to Japan by the Emperor is analo- 
 gous to many of the constitutional precedents (for we 
 have no written Constitution) of Great Britain. In 
 other respects the French or German representative 
 institutions can be traced, and many provisions are 
 sui generis, originating from the well-considered and 
 ripe judgment of those who framed this Magna Charta 
 to suit the customs and requirements of Japan. Other 
 provisions are, again, modifications, and in many 
 instances improvements, of the systems adopted else- 
 where. 
 
 As the port of Kiaochow has loomed rather large 
 before the public eye during this war in consequence of 
 our Allies the Japanese having captured it from the 
 Germans, a few words respecting it may not be out of 
 place. Russia had occupied Port Arthur in 1897. 
 France had got her frontier rectified in the Meking 
 valley, as it was euphoniously called, and the time 
 appeared ripe for Germany to claim her share of the 
 good things going ; so she determined, to quote Count 
 von Billow, *' not to be out of the sunshine," and found 
 a pretext in the murder of two German missionaries 
 
THE "HUN^' SPEECH RECALLED 189 
 
 by some fanatical Chinamen in the interior to assert 
 her position. The German Emperor deemed that this 
 lamentable occurrence could only be expiated by the 
 surrender to Germany by the Chinese of the harbour of 
 Kiaochow. Germany also demanded, with the threat 
 of the " mailed fist " indicated by the squadron of 
 ironclads which she sent to the East, the right of 
 making a railway in and controlling the province of 
 Shantung, in both of which plans she succeeded. She 
 immediately set to work to make the new harbour of 
 Tsingtao. The next step in the trend of events which 
 happened in China was the Boxer rising in 1900, and 
 the march on Peking by the Allied Forces, including the 
 Japanese, to the rescue of their several legations. 
 
 To teach " the pagan," it is presumed, some of the 
 Christian virtues, the Kaiser made the following famous 
 speech to the German contingent which took part in 
 the operations against the Boxers, which it seems 
 worth while inserting here, as some people may have 
 forgotten how the name " Hun " has been acquired 
 by the Germans. His Majesty said to his men : 
 
 " No quarter will be given, no prisoners taken. All 
 who fall into your hands shall be at your mercy. Just 
 as the Huns a thousand years ago, under the leadership 
 of Attila, gained a reputation for sternness in viitue 
 of which they still live, so may the name of Germany 
 become known in such a way in China that hereafter no 
 Chinaman may so much as dare to look askance at a 
 German." 
 
 The Japanese troops fought bravely side by side 
 with the troops of the Western nations, especially 
 jseeping up the best relations with the British and 
 
190 ALLIES IN PEACE AS WELL AS WAR 
 
 American forces. During the first stages of the cam- 
 paign, the French entrusted the care of their sick and 
 wounded to the Japanese military medical service, 
 and thus practically testified — as has been also done 
 by eminent British medical men, such as Sir Frederick 
 Treves, and others — to the completeness and excellence 
 of the Japanese military medical arrangements for 
 the care of the sick and wounded, and to the determina- 
 tion to do all in human power to alleviate the sufferings 
 of friend and foe alike caused by the dread realities 
 of war. 
 
 Great Britain and Japan entered into a new and 
 strengthened alliance in the year 1905. That treaty 
 contains a clause to which Japan has strictly adhered, 
 promising to act under certain contingencies in support 
 of the naval and military forces of the United Kingdom. 
 The treaty between Great Britain and Japan has been 
 tried in the ordeal of fire and has not been found 
 wanting. The two island Empires of Great Britain 
 and Dai Nippon are both non-aggressive Powers, and 
 no incident can arise which one can foresee which in 
 their united action can fail to be beneficial to the 
 interests of peace. 
 
 It makes one sad to reflect that no country in the 
 world was pursuing its path of peaceful progress and 
 living, apparently, on terms of perfect friendship with 
 its great German neighbour more contentedly than 
 Belgium in July 1914. Without provocation or excuse, 
 and with a cynicism that is absolutely appalling, 
 Germany tore up the *' scrap of paper " in which she 
 had with the other great Powers of Europe guaranteed 
 Belgian independence, and invaded that country, send- 
 ing her hordes of long-prepared and carefully organised 
 
BELGIAN BRAVERY 191 
 
 armies across the Belgian frontier to attack the fortress 
 of Li6ge. Bravely and stubbornly did Belgium do 
 her best to withstand her giant foe, and in that memor- 
 able fortnight during which she checked the enemy and 
 gave to the armies of France and Russia, and our small 
 but gallant expeditionary force, a short period to 
 prepare, the time thus given proved to them of in- 
 estimable value, and did much to save the situation 
 and rescue Europe from a devouring aggressor and a 
 bitter fate. Belgium suffered cruelly for that, and is 
 still suffering ; but as there is a God to protect the 
 weak, who, in due course, and in His own time, metes 
 out punishment to the evil-doer, her wrongs will be 
 righted and her future security assured by no parch- 
 ment treaty (worthless with such a foe !) but by the 
 strong arm of retribution and just revenge, rendering 
 her neighbour powerless to again rob, ravish, murder, 
 burn, and d*estroy. As far as money or added territory 
 can repay Belgian wrongs she will have just restitution 
 made to her by Germany, though, alas ! no restitution 
 can restore to life her brave men, women, and children 
 who have been massacred, or her gallant soldiers who 
 have fallen in her fight for life and liberty. 
 
 Though the population of Belgium does not exceed 
 seven and a half million souls, her manufacturing in- 
 dustries are of great importance. Her chief exports 
 to the United Kingdom in 1914 consisted of flax and 
 cotton manufactures, glass, leather goods, iron and 
 steel, linen, motor-cars, woollens, zinc, and paper, whilst 
 she purchased from the United Kingdom a large amount 
 of coal, cotton manufactures, chemicals, leather and 
 boots, machinery, metals, wool, and a large number 
 of horses, the last to the value of £363,486. 
 
192 ALLIES IN PEACE AS WELL AS WAR 
 
 The Belgian trade was in 1914 to a considerable 
 extent a transit one, and her import tariff was so 
 arranged that there were light duties in the portion of 
 her trade which was a transit one, and heavier ones on 
 those goods imported for use in Belgium and which 
 competed with her manufactures. As Belgian works 
 make similar goods to those we obtained from Germany, 
 a discriminating duty in her favour by the United 
 Kingdom, after we have a general tariff, would be to 
 the great advantage of her trade. 
 
 In turning our eyes to our Ally beyond the Alps, 
 Italy, since the days when her traders bartered their 
 goods with the inhabitants of this country for the 
 products of the tin mines of Cornwall, has always had 
 commercial dealings with the United Kingdom of 
 greater or less importance. At present they are con- 
 siderable, and appear to be, as they were in those 
 early days in history, the natural products of Great 
 Britain, such as coal and iron, more than with her 
 manufactures. In 1914 they amounted in value to 
 fourteen millions, whilst we purchased eight and a half 
 millions of her merchandise, principally her silk ard 
 vegetable food-stuffs, together with a considerable 
 quantity of woollens, cotton goods, hemp, linen, yarn, 
 and tissues. 
 
 Italy appears to have been always an important 
 maritime and agricultural power, though the former 
 seems to have been her chief role. She possesses a 
 mercantile marine of about one million one hundred 
 thousand tons burden, chiefly iron or steel vessels, and 
 from her position in Europe she already possesses a 
 very large share of the trade of the Mediterranean ports. 
 In addition to this her lines of steamers and trading 
 
ITALY 193 
 
 vessels are now found in every port throughout the 
 world. 
 
 As we are aware, her naval force is of considerable 
 relative strength in comparison with the other navies 
 of the world, and she has in recent years spent large 
 sums on its equipment and armament. As the years 
 roll on we may expect to see a peaceful rivalry of a 
 more pronounced character between Italian merchant- 
 men and those conducting our carrying trade to the 
 East. 
 
 The following extract from a recent consular report 
 may be of great interest to either Canada or Russia, 
 more so, probably, than to the United Kingdom : 
 
 " Since the outbreak of war Italy has experienced 
 the greatest difficulty in getting timber from Austria- 
 Hungary, her chief supplier, and the importation of this 
 commodity decreased very much. The Government 
 has for some years past realised the necessity of en- 
 couraging reafforestation, with a view to rendering 
 Italy independent of foreign countries for the supply 
 of timber, the importation of which averages one million 
 two hundred and fifty thousand tons per year. Large 
 sums have been devoted and are yearly spent in plant- 
 ing forests and regulating the water basins in the 
 mountains under the State domain, and prizes are 
 distributed among private landowners who are dis- 
 posed to follow the Government's example. But for 
 many years to come Italy will have to import large 
 quantities of timber. There was a small decrease in 
 the importation of furniture from Austria-Hungary 
 and the United Kingdom." 
 
 A large proportion of the inhabitants are employed 
 in agriculture, and though the soil is not cultivated 
 
194 ALLIES IN PEACE AS WELL AS WAR 
 
 to the high standard which it probably might attain, 
 still Italy's chief agricultural products, such as wine, 
 oranges and lemons, and olive oil, conduce greatly to 
 her wealth and to her export trade. 
 
 There is no doubt that our trade with this country 
 would increase if her import tariff were not so high as 
 it is, if she organised and classified her tariff more 
 thoroughly, and if there were more reciprocity in that 
 respect between the United Kingdom and Italy. 
 
 The best customer for her hemp and flax tissues is 
 Great Britain. During the year 1914 Italy was 
 favoured with an abundant crop, and her exportation 
 of those materials rose greatly. The war has caused 
 a great set-back in the Italian silk industry. That, 
 one must hope, is only of a temporary character. She 
 has been importing a large amount of rubber from 
 Brazil and the Straits Settlements, the result being 
 an increased exportation of tyres produced exclusively 
 in Northern Italy, from seven thousand hundredweights 
 to forty-one thousand hundredweights coming to the 
 United Kingdom, whilst the exportation of tyres to 
 Belgium, Switzerland, and Germany has decreased. 
 
 It is noticeable that in 1914, whilst there was an 
 increase of Italy's exports to Great Britain of more 
 than two million pounds sterling in value, there was a 
 decrease to Germany of about one million. 
 
 At the moment of the declaration of war by Italy 
 against Austria, she was hampered in her commercial 
 relations with Germany by two treaties — one signed 
 on the eve of the declaration of war, which in substance 
 was a modification of the international Geneva con- 
 vention tending as far as possible to " civilise " warfare, 
 and another, a commercial trea-ty, signed for the first 
 
ROUMANIA 196 
 
 time in 1891 and renewed in 1904, which made Italy a 
 tributary to Germany from the economic point of view. 
 It was announced in August 1916 that this second 
 treaty, to which Germany attached the greatest 
 importance, was about to be denounced by Italy. 
 
 There has been a very complete penetration of Italy 
 by German trade and finance operations. It has been 
 clearly seen that the way in which Italy will be rescued 
 from that position is by the arrangements made by the 
 joint efforts of a British-Italian Banking Co-operation 
 recently started to provide methods of finance of a 
 satisfactory character, a scheme by which the com- 
 mercial independence of Italy will in no sense be 
 compromised. Our hearts go out to our gallant Ally 
 and her brave soldiers who are so determinedly meeting 
 the foe on her northern boundary. 
 
 The Kingdom of Roumania, although comparatively 
 speaking a small one, containing as it does a population 
 of about seven and a half million people, has come 
 gallantly to the front and joined the Entente Powers 
 against the Military Autocracy of the German Empire 
 and her satellite associates, and she is, as these lines are 
 written, struggling for her independence and liberties 
 against the octopus-like grip of the Central European 
 Confederation and their Balkan Allies. 
 
 The wealth of this country consists principally in 
 cattle, corn, minerals, and petroleum ; not greatly 
 worked except in regard to her petroleum fields and 
 salt mines ; both of which have, no doubt, caused her 
 to be looked upon with jealous eyes by the Central 
 Powers. She defeated Bulgaria in the second Balkan 
 war of 1913, and is said to have made a treaty with 
 that Power last year, which promised neutrality if 
 
196 ALLIES IN PEACE AS WELL AS WAR 
 
 she went to war with Germany. Roumania appears 
 to have believed that this treaty would be adhered to, 
 and, in consequence of Bulgaria's treachery, has had to 
 defend two frontiers instead of one. Her army, when 
 fully mobilised, is said to consist of seven hundred and 
 fifty thousand men, or ten per cent, of her population. 
 
 Roumania is amongst one of the richest agricultural 
 and mineral-bearing countries in Europe, and contains 
 an area of about fifty- three thousand square miles . The 
 people pride themselves on the fact that they are largely 
 of Latin origin, and thus have a racial link with France 
 and Italy. As regards the climate the winters are 
 intensely cold and the summers equally hot. The 
 geographical position of the country renders it the 
 guardian of the mouths of the Danube— that great 
 central European river with its vast, though only 
 partially developed possibilities. 
 
 How history repeats itself ! The Roumanian people 
 of to-day are the descendants of those Roman 
 colonists whom Trajan planted for the defence of the 
 Empire against the northern barbarians, and in defence 
 of Latin civilisation. Their first conquest is com- 
 memorated in the reliefs of Trajan's column in Rome. 
 The province was named Dacia, and included the 
 greater part of the modern Roumanian Kingdom and 
 of Transylvania. To the present day the vast 
 majority of the population of Transylvania are Rou- 
 manian, alike in origin, in language, and in sympathy. 
 
 A recent electoral law passed in Hungary includes 
 special clauses demanding a higher qualification for 
 the vote in Transylvania than in Hungary proper, and 
 also giving preferential voting power to the towns 
 where the Saxon and Magyar element is considerable 
 
PORTUGAL 197 
 
 rather than to the country districts where the Rou- 
 manians predominate. As a result one deputy has 
 been chosen in recent elections for every four to five 
 thousand electors in Eastern Transylvania, while in the 
 Roumanian parts of that province there is only one 
 deputy for every fifty or sixty thousand.^ 
 
 The exports from Roumania in 1913 to other coun- 
 tries consisted chiefly of petroleum, cattle, and cereals 
 including wheat, barley, and maize. Roumania's im- 
 ports from the United Kingdom in 1914 were, in 
 value, about two millions sterling, and her exports 
 exceeded slightly three millions. 
 
 Portugal has, in conformity with an ancient treaty 
 with the United Kingdom, recently joined the Allies 
 in the defence of civilisation, and is rendering valuable 
 aid in the East African campaign, also by annexing 
 at her ports and harbours the enemy's ships for the 
 use of the carrying trade of commerce. It is stated 
 that, in addition to this, she is sending a contingent 
 of troops to France. 
 
 In 1914 her imports from the United Kingdom ex- 
 ceeded two million pounds sterling in value, whikt she 
 sent us of her products to the value of one million 
 pounds, chiefly the excellent vintages of her grapes, 
 and also cereals and other agricultural produce. 
 
 The two Balkan States of Servia and Montenegro 
 are so geographically situated that their interchange 
 of goods and commodities with the United Kingdom 
 
 1 We have even greater anomalies than that in the United King- 
 dom, for we give one representative each to Galway and Newry in 
 Ireland, though both together only number about four thousand 
 electors, whilst we give no more to the Borough of Wandsworth, 
 London, and the County Division of Walthamstow, Essex, each with 
 about forty thousand electors. 
 
198 ALLIES IN PEACE AS WELL AS WAR 
 
 has been only limited. They have both suffered 
 much after twice jointly defeating their giant neigh- 
 bour on the northern side of the Danube, and from 
 the flames of adversity and oppression, let us hope, 
 they will arise before long with enlarged borders, use- 
 ful outlets to the sea, renewed strength and prosperity, 
 and the assured feeling of not only having a staunch 
 and true friend in Russia, but the loyal and hearty 
 friendship of all the other Allies, who will do what lies 
 in their power to further their interests. 
 
CHAPTER VI 
 
 NEUTRAL NATIONS 
 
 " Our ancestors have turned a savage wilderness into a glorious 
 empire, and have made the most extensive and the only honourable 
 conquests, not by destroying, but by promoting the wealth, the 
 number, the happiness of the human race." — From a speech delivered 
 hy Edmund Burke, in the House of Commons, March 22nd, 1775, on 
 Conciliation with America, 
 
 Despite the fact that years have rolled by, it is still 
 the lot of the author to call to mind a remark once 
 made to him by an American merchant, which, al- 
 though humorous (as nothing is more quaint than a 
 sudden contrast of ideas), did not fail at the same 
 time to indicate the American practical turn of mind. 
 It was in midwinter. Standing on the Canadian side 
 of the Falls of Niagara, looking at one of the most 
 magnificent — one might almost say awe-inspiring — 
 sights in the world — that mighty mass of w^ater dash- 
 ing from the heights above, with a vibrating roar, 
 into a foaming abyss, whilst even the spray, as it 
 separated from the huge volume of water, appeared 
 powerful enough to dash asunder the ice-bound rocks 
 on either side of the Falls — the latter remarked, " What 
 a big waste of water power ! " Four years ago, in 
 1912, when at Toronto, having crossed Lake Ontario 
 16 199 
 
200 NEUTRAL NATIONS 
 
 in a steamer from Canada and going by a "railroad " 
 past the fierce and foaming and loudly resounding 
 rapids to the Falls, I then saw that which my friend 
 had spoken of had been accomplished. The Falls had, 
 so to speak, been harnessed, and their immense motive 
 power utilised, so that the electric lighting of many 
 large cities both in Canada and the States was accom- 
 plished by their mighty force, and numerous forms of 
 industry in mills and factories were worked by the 
 same means. Despite the beauty of the Victoria 
 Park on the Canadian shore, the huge power station, 
 and especially a number of ugly, grimy-looking works 
 by which the American side was disfigured, somewhat 
 detracted from the grandeur of the scene referred to, 
 though nothing could entirely rob the Falls of their 
 majestic grandeur, and lessen the feeling, akm to 
 awe, with which one viewed them. 
 
 In this pushing, go-ahead age, especiallj^ in the 
 American Continent, utility is the one thing aimed at, 
 and they may be right in that respect, and it is ill for 
 a British subject to complain, especially in a work in 
 which he is endeavouring to urge his fellow-country- 
 men to " wake up." Cannot we take a lesson from 
 this practical use of this mighty water power, and, by 
 utilising the vast motive power either by opening or 
 closing the sluice-gates of preferential trade within 
 our mighty and potentially prosperous United Empire, 
 unlock the doors barred to our industries in foreign 
 protectionist States, working unitedly in mutual com- 
 mercial amity with our Allies, our American cousins, 
 with neutral States, and also, in the course of years, 
 with some, if not all, of our present foes ? Is it not 
 worth trying (even if some of us have to give up some 
 
WAR FINANCE 201 
 
 preconceived prejudices) to benefit both ourselves and 
 those who come after us, and to bring into our revenue 
 large sums to aid our taxation ? 
 
 To the mind of the statesmen in the great Republic 
 in the West, it has appeared as clear as crystal that a 
 very heavy income tax, or oppressively high death 
 duties, are a discouragement to thrift and economy ; 
 a bar to enterprise, persevering work, and industry ; 
 and simply an incentive to a " let us eat and drink 
 and amuse ourselves, for to-morrow we die " tone of 
 thought amidst all classes of the community. After 
 the great civil war between the Northern and Southern 
 States in America in the last century, they increased 
 their tariffs. 
 
 That fierce struggle was won by the North after 
 many reverses, not so much by the marked military 
 genius of their generals — for no leader to compare with 
 Washington was found amongst the armies of the 
 North — as by the resolute patriotism and the thorough- 
 ness of the determination to succeed of the Americans 
 themselves. The object of the United States in rais- 
 ing their customs dues was to assist the country in 
 paying the heavy expenses of this war, an end which 
 it has to a large extent accomplished. 
 
 The views of Americans in regard to the question of 
 tariffs may be best gathered from the words of the 
 Republican Manifesto in 1906: 
 
 " The true American policy taxes foreign products, 
 and encourages home industries. It puts the burden 
 of revenue on foreign goods. It secures the American 
 market for American producers. It upholds the 
 American standard of wages for the American work- 
 ing-man." 
 
202 NEUTRAL NATIONS 
 
 The Democratic manifesto also proclaims that " in 
 the United States, as elsewhere, Protection protects 
 labour." 
 
 The value attached to the home market by American 
 economists is indicated by the following quotations ; 
 
 " A bushel of corn is worth as much in Illinois or 
 Iowa as in the neighbourhood of Paris or of London. 
 The sole reason why it sells for only a fourth or fifth 
 as much is that the farmer is burdened with the cost 
 of sending it to market. Bring the market to him by 
 opening the great coal and ore deposits of Indiana, 
 Illinois, Missouri, and Michigan, and then not only will 
 he be relieved of the necessity for looking to distant 
 markets, but it will be impossible for him to supply 
 them because the price at home will be on a level with 
 that abroad." 
 
 Whilst one prefers to refer to modern views, as 
 quoted above, on this subject of Free Trade or Protec- 
 tion, it might also be pointed out that the American 
 school of political economy was founded by Alex- 
 ander Hamilton, one of the greatest statesmen of the 
 United States of America, who held that "the free- 
 trade doctrine of Adam Smith was only possible in 
 practice if adopted by all nations," and that home 
 competition would cause the home-made product to 
 be cheaper than the foreign article in most instances. 
 The American turn of mind is an eminently practical 
 one ; the men of that great commonwealth have no 
 objection, as a rule, to the idea of free trade through- 
 out the world per se, if it could be accomplished. 
 What they do object to, and have no use for, is 
 Oobden's free-import trade system, which is, as an 
 
WHERE TRUE FREE TRADE EXISTS 203 
 
 American Senator called it in a conversation at 
 the Capitol in Washington City in 1910, "a very 
 lob-sided, one-horse proposition." It must be re- 
 membered that within the United States itself, from 
 north to south, from east to west, free trade exists at 
 the present day. By the American Constitution that 
 will continue permanently, as no duty or tax can be 
 charged by one State in the United States on the goods 
 of another. 
 
 Amongst the many problems of importance relating 
 to the British Empire now before the country, that 
 of the Constitutional Federation of the whole Em- 
 pire, to which previous allusions have been made, 
 must be considered ; and the following aspiration, 
 expressed by Mr. Balfour last year, will, one trusts, 
 be realised : 
 
 " That in the fullness of time the true and proper 
 climax of this great historical evolution was not 
 separate communities, however great, however free, 
 however scattered in the world, but one United 
 Empire." 
 
 Turning again to the great American Republic, it 
 may be well to reflect on the mode by which the 
 Union or Federation of that Union of independent 
 States was accomplished. First, to put briefly and 
 concisely the position of affairs in America prior to 
 the separation of thirteen of the American Colonies 
 from the United Kingdom. At that time each pos- 
 sessed local legislative bodies modelled somewhat on 
 the lines of our Parliament of those days. Until the 
 last stages of the struggle, which led to secession, these 
 
204 NEUTRAL NATIONS 
 
 Colonial Assemblies never claimed the right to control 
 their outside or foreign trade relations. The British 
 Government, on their part, undertook to protect the 
 coasts and the ships of America at the cost of the 
 British Treasury. The frontiers of these Colonies were 
 constantly being menaced and attacked by fierce 
 Indian tribesmen, and also by their neighbours, the 
 French. With the latter Power Great Britain waged 
 the Seven Years' War, and accepted the responsibility 
 for its cost, aided by such contributions as the Colonies 
 chose to furnish. These sums were, comparatively 
 speaking, slight, and nearly the whole cost of this 
 war, which ended in our victory, fell on the British 
 taxpayers. The question of paying for it was never 
 an element in the final quarrel between Great Britain 
 and the American local Parliaments. We had, how- 
 ever, to maintain a considerable force in America to 
 protect the Colonies against further attack, and on 
 behalf of the British taxpayer, then heavily burdened, 
 our Government sought to receive some settled con- 
 tribution from the Colonists more directly interested 
 in the matter themselves. 
 
 The Imperial Government applied more than once, 
 in vain, to the Colonial Assemblies for contributions, 
 and then, as the result proved, unwisely, but in a way 
 which they believed to be within their rights, decided 
 to raise the necessary contribution from the Colonists 
 by Act of Parliament, and passed the Stamp Act and 
 a duty on tea to do so. This caused the revolution. 
 During the first Continental Congress in 1774, Calla- 
 way, the loyalist leader, submitted a measure for con- 
 verting Congress into an American Government under 
 a British Viceroy. This proposal was first accepted 
 
AMERICAN CONSTITUTION 205 
 
 in principle, and then ultimately defeated, as had been 
 a plan to form a Central American Parliament twenty 
 years previously. 
 
 After the Declaration of Independence the same 
 difficulty arose of inducing the various States to raise 
 supplies to pay the debts incurred during the war, or 
 to carry on the administration and defence of their 
 territories as a whole. This was found an insuperable 
 task. Grave dangers and difficulties, and even 
 anarchy, were impending. At length the various 
 provinces — or States, as they were called — agreed to 
 transfer certain of their powers to a national Govern- 
 ment. 
 
 Washington and his compeers drafted this important 
 Constitutional Charter, which was at a Convention 
 brought before, and agreed to by the representatives 
 of the then thirteen American States. With a few 
 important modifications, it is still in force, and is 
 probably the most carefully thought-out and well- 
 devised Constitutional Charter the world has ever 
 known, the more so when one remembers that, at the 
 time they were framing it, it was in many directions 
 an absolutely novel departure. 
 
 In this constitutional law both Chambers appear 
 to have equal powers as to money Bills, for by Article 8 
 it is enacted that — 
 
 " the Congress (that is to say, both the Senate and 
 the House of Representatives) shall have power to 
 lay and collect taxes, duties, imposts, and excises, to 
 pay the debts and provide for the common defence 
 and general welfare of the United States ; but all 
 duties, imposts, and excises shall be uniform through- 
 out the United States." 
 
206 NEUTRAL NATIONS 
 
 Again, I find that — 
 
 " no tax or duty shall be laid on articles exported 
 from any State. And also that no preference shall 
 be given by any regulation of commerce or revenue 
 to the ports of one State over those of another : nor 
 shall vessels bound to, or from, one State be obliged 
 to enter, clear, or pay duties in another." 
 
 Why, when we were giving autonomy to the various 
 States comprised in the British Empire, won as most 
 of them were by our own blood and our own money, 
 we did not adopt a similar provision, it is difficult at 
 the present time to understand. Again, we find in 
 the Constitution of the United States that — 
 
 *' no State shall, without the consent of Congress, 
 lay any impost, or duties, on imports or exports 
 except what may be absolutely necessary for executing 
 its inspection laws ; and the net produce of all 
 duties and imports, laid by any State on imports or 
 exports, shall be for the use of the Treasurj^ of the 
 United States and all such laws shall be subject to the 
 revision and control of Congress.'* 
 
 It is also enacted that — 
 
 "No State shall, without the consent of Congress, 
 lay any duty upon tonnage, keep troops or ships of 
 war during peace, enter into any agreement or com- 
 pact with another State, or with a foreign Power, or 
 engage in war, unless actually invaded, or in such 
 imminent danger as will not admit of delay." 
 
 It will be seen from these extracts from the American 
 Constitution how carefully they safeguarded the 
 
THE ENTENTE ALLIANCE 207 
 
 freedom of trade within the boundaries of the Ameri- 
 can Republic. 
 
 All the representatives who appended their signa- 
 tures to this State document bore British names. It 
 was not the custom then, as at present, for foreigners 
 to change their names, so one may take it that at 
 that time, at all events, the white population of 
 America, in those thirteen States, were mainly, if not 
 entirely, of British extraction. 
 
 The population of the United States, taken in 1900, 
 was about seventy-six millions. By the last census, 
 in 1910, it had increased to ninety-two millions; of 
 these, two and a half millions were born in Germany, 
 but one is given to understand that no inconsiderable 
 number of them are opposed to the Kaiser's policy. 
 
 The United States is not only a great gainer in a 
 purely material sense by the bulwark the Entente is 
 opposing to Prussian militarism and aggression in 
 this great war, but her statesmen must be aware that 
 the Entente Alliance is fighting the battles of civilisa- 
 tion, in which good work the States may soon rally by 
 their side ; for were it possible for Prussia, aided by 
 her Allies, to assert her supremacy over the Entente 
 Powers and defeat them, it would only be a matter of 
 time before America would have to fight herself to 
 defend her own just rights and also those of the Latin 
 South American States, and against their absorption 
 in the Kaiser's Dominion. 
 
 It should be borne in mind that the United States 
 owed, in 1915, about fifteen hundred millions ; of 
 that amount we were the largest creditor nation, 
 the amount owed to us being eight hundred millions 
 sterling. That large debt has probably before now 
 
208 NEUTRAL NATIONS 
 
 been swept away, if, in fact, we are not now largely 
 a debtor nation to the United States. 
 
 As Sir John Spear, M.P., said in his place in a 
 debate in the House of Commons, in 1916 : 
 
 " In this very expensive war it has been very em- 
 barrassing that we have had to send as much gold to 
 America to purchase things which, with equality of 
 competition and sufficient encouragement for security 
 against dumping bounties or hostile tariffs, we might 
 very well and easily have produced at home." 
 
 American industry has always been conducted on 
 thoroughly efficient and up-to-date lines, and the 
 increased banking facilities which will be afforded to 
 her industries by the Federal Reserve Act of 1914 will 
 tend to give their manufacturers increased oppor- 
 tunities to increase further their output of products 
 and manufactures for the international trade of the 
 world, as well as for their home consumption. The 
 American can afford to look more at home for his 
 markets than the Englishman ; it is one of the greatest 
 advantages which a young and immense country like 
 America can possess that no congestion in her labour 
 market can last long. The inhabitants, too, can 
 change their district or their employment with greater 
 facility than is possible in an old and more settled 
 country. Thus one sees that in a few years millions 
 of the inhabitants of the United States change from 
 one part of the Union to the other, and open out 
 immense regions for the growth of corn or cotton as 
 opportunity requires ; or migrate from the country 
 districts to the great centres of industry and manu- 
 facture, if, as at present, there is any increased world- 
 
AMERICA'S WORLD-WIDE TRADE 209 
 
 wide demand for those products : and they can do 
 so with greater facility and with less feeling of being 
 transplanted than is the case with the inhabitants of 
 these Isles who emigrate to a distant Dominion across 
 the seas. 
 
 The increase of the railway system in the United 
 States has been very great in recent years, and in 
 1904 the mileage exceeded two hundred and forty-seven 
 thousand miles. The permanent way on their lines is 
 not, as a rule, as smoothly laid as in this country ; and 
 though their railway carriages are comfortable and 
 many trains are provided with " Observation Cars " 
 from which one can view the country with ease as one 
 travels through it, the trains are frequently overheated. 
 The exchange of trade in normal times with the 
 principal countries of the world is immense ; in 1913 
 their exports to the United Kingdom were in value 
 nearly six hundred million dollars, and in 1914 about the 
 same ; whilst they imported from us in both those 
 years goods to the value of about three hundred milhon 
 dollars, or about half the amount in value purchased 
 from them. Their trade to and from Germany was the 
 next in importance in those two years, though con- 
 siderably less than with this country. In 1913 more 
 than fourteen and a half million running bales of cotton 
 were produced in America in over twenty-four million 
 acres of land. 
 
 The dues charged on imports to the United States 
 are as a rule high ; on the greater number of linen and 
 hempen goods it is ten to sixty per cent, ad valorem 
 duty ; on articles made partly of lace the higher duty 
 is charged. On silk it is from fifty to sixty per cent., 
 whilst on cloth, velvet, stockings, blankets, clothing, 
 
210 NEUTRAL NATIONS 
 
 laces, and carpets, varying duties are charged ranging 
 from twenty to fifty per cent. Again, on metals, cutlery 
 (once almost a monopoly of English manufacture in 
 the United States), machinery, brass and leather goods, 
 and also on those composed of zinc, earthenware, 
 porcelain, glass, paper, also stationery * and books, 
 heavy duties are charged. Cotton goods are admitted 
 at a lower rate, in no cases exceeding twenty-five per 
 cent, ad valorem. 
 
 Despite these duties our manufactured products 
 still find a considerable entrance into their markets. 
 Taking a particular district as an instance, for example, 
 I see by one of the most recent consular reports from 
 Boston that British boots and shoes, though not an 
 important branch of our export trade to America, were 
 becoming more popular in that district. On the other 
 hand, a very large and important branch of their 
 commerce is the American export of leather to Great 
 Britain and Europe generally. 
 
 The following is an interesting extract from the 
 Boston District consular report to which reference 
 has been made, as showing the rather potyglot class of 
 individuals engaged there in industry ; 
 
 " The Commonwealth of Massachusetts empowered 
 a Commission to examine the conditions of immigration 
 into this State. The investigation carried out by the 
 Commission was brought to a conclusion in the earlier 
 part of the past year, and much information of value 
 was accumulated. 
 
 " It was found that the percentage of persons coming 
 from the United Kingdom engaged in manufacturing 
 and mechanical industries in Massachusetts decreased 
 from 19-3 per cent, in 1890 to 11*6 per cent, in 1913, 
 
CONSULAR REPORTS 211 
 
 that of persons of Irish birth so engaged decreased in 
 the same period from 29*8 to 12' 7 per cent., that of 
 British Canadians decreased in the period considered 
 from 16 to 3' 3 per cent., while that of French Canadians 
 fell from 206 to 16'7 per cent. 
 
 " On the other hand, Poles, who do not figure at all 
 in the percentage estimates for 1890, made up in 1913 
 13" 7 per cent, of the persons engaged in mdustries in 
 Massachusetts. Portuguese, Greeks, Lithuanians, Jews, 
 Armenians, and Syrians all appear in the percentage 
 estimates relating to persons employed in industries 
 in Massachusetts in 1913, though none of these races 
 are mentioned in the estimate for 1890. 
 
 " Of 1,217 factories which reported to the Commission 
 on the subject of the number of Southern and Eastern 
 Europeans in their employ, 513 reported an increase 
 in the number of such employes." 
 
 This report also mentions that the rate of wages had 
 recently become higher in that part of America, that 
 the hours of labour were less per day, and that war 
 orders played an appreciable part in keeping labour 
 employed. One fact in this report it was satisfactory 
 to notice : that a local textile manufacturer of Boston 
 admitted that the British manufacturer excelled him 
 in point of style and finish of the cloth ; and that he 
 also showed " greater originality and variety in design " 
 is another advantage resting with the British manu- 
 facturer. It is gratifying to find in this instance that 
 our home exporter has thoroughly studied the market, 
 and that his goods are said to give little cause for 
 complaint on the ground of unsuitability to local trade 
 conditions. As this complaint has sometimes been 
 alleged against British merchandise, the above facts 
 are worthy of note. 
 
212 NEUTRAL NATIONS 
 
 Another fact should be of interest, and that is the 
 return of the shipping of all nationalities which entered 
 and cleared in the foreign trade of the Port of Boston 
 during 1914. Of the former 2,002,648 was the net 
 tonnage of British ships which entered out of a total 
 of 2,909,193 tons in all, and of the latter 2,069,708 was 
 the tonnage of British ships out of a total which cleared 
 2,524,619. 
 
 In another consular report for 1914, from the Consular 
 District of Savannah by Colonel Brookfield, His 
 Majesty's Consul in that area, and for many years 
 member for the Rye Division of Sussex in the House 
 of Commons, the statement was made that there was 
 a decrease in that year both of shipping and trade at 
 Charleston in consequence of the Great War, 
 
 When the writer visited Charleston on his way to Palm 
 Beach, Cuba, and South America in 1911, he found it a 
 place of interest, and an important maritime centre for 
 the exportation of cotton and other goods to Europe, 
 and for coastwise trade. Part of that city is like a bit 
 of old England, as one imagines it was at the beginning 
 of the nineteenth century, dumped down in busy 
 America of to-day. The people you meet speak in 
 that soft southern accent so pleasant to the ear, and are 
 most hospitable to visitors ; the latter characteristic is, 
 however, almost universal in America. On the sea- 
 front at Charleston there are a number of villas which 
 remind one of those on the Riviera, and a short distance 
 from it are the beautiful public gardens with semi- 
 tropical flowers of all descriptions growing in them. 
 
 From America some splendid lines of steamers run 
 to South America, and in future the Americans will, as 
 at present, spare no effort to gain even a larger share 
 
THE COST OF FREIGHT 213 
 
 of the important trade of those Latin countries. They 
 published a few years ago an American Trade Directory 
 in the Portuguese language in Brazil, and a Spanish 
 one for the Argentine. Why do we not adopt a similar 
 course ? 
 
 Except during times of war, the charges for freight 
 to and from America have been greatly reduced in 
 recent years, so that the Englishman, in this country, 
 making goods competing with those exported from the 
 United States has not the compensation in his favour 
 of his foreign competitor having to pay a heavy 
 freight, whilst on the other hand the taxes are heavier 
 here than in America. Why should our manufacturer 
 be handicapped by heavy duties in America on sending 
 goods there whilst they have a free and open market 
 here ? 
 
 Regarding cotton and other raw produce for manu- 
 facture, various questions arise, and we must regard 
 them from a dilferent point of view. 
 
 It should be our endeavour to send full cargo ships 
 to the States as well as receiving well-laden ships from 
 America in our ports. Freights would naturally be 
 reduced if shipowners found they could load their ships 
 with produce on going to the United States as well as 
 on the return voyage. Freight is an element of cost 
 in regard to all imports and exports, therefore by its 
 reduction the consumer in either country is a gainer. 
 
 We Britons do not look at the Great Republic in the 
 West, the inhabitants of which country are mainly 
 sprung from the same race as ourselves, simply as 
 possible competitors in industry and commerce, nor do 
 we envy their prosperity. But we hope that we, as the 
 people of another great nation, may also prosper. 
 
214 NEUTRAL NATIONS 
 
 Our aims are the same, and seek to secure the freedom 
 of humanity from wrong, tyranny, and oppression. 
 
 The importance of our relations with all the neutral 
 nations in the north of Europe is great ; many of whom 
 have had, unfortunately, to bear gross indignities 
 and to suffer maritime losses by the unjustifiable and 
 piratical action of the enemy's submarines — though 
 some of them may have been gainers more than 
 losers during the course of this titanic struggle. It 
 is proposed by the writer to confine his remarks here 
 to a brief reference to some of the aspects of the 
 problems already alluded to in these pages in relation 
 to the countries of Spain, China, and certain of the 
 larger South American States. 
 
 English men and women must feel grateful to the 
 people of that free and beautiful country Switzerland, 
 for the kindness and benevolent action to some of our 
 wounded prisoners of war who have been allowed to go 
 there and find a haven of rest and happiness after having 
 endured the rigours and harshness (to use no stronger 
 words) to which the Prussian military authorities treat 
 those whom they capture, in consequence of which some 
 of these British prisoners of war have, to the writer's 
 official knowledge, lost their reason. 
 
 One question will have to be settled by all the civilised 
 nations of the world when this war ends, neutral as 
 well as those which are at present the belligerent 
 Powers, and that is the use of undersea vessels and of 
 mines in time of war. Both neutrals and belligerents 
 have suffered from this mode of warfare, and from the 
 way in which the Central States, especially the German 
 Navy, have abused the power these undersea vessels 
 have given them in attacking and sinking, often with- 
 
THE POLICING OF THE SEAS 215 
 
 out warning, hospital ships, ocean liners, mercantile 
 vessels, and even fishing boats with their crews peace- 
 fully plying their industry. 
 
 Whether the Neutral Powers have a large sea-board 
 like America, China, Spain, The Argentine, and Brazil, 
 or a smaller one like Holland, Denmark, Sweden and 
 Norway, they are interested in this question of the use 
 of the sea and the prevention of the abuse of their 
 hospitality and the misuse of their ports and harbours 
 by submarines. The United States and Spain have 
 protested to the Central States regarding the murder 
 of their citizens by German submarines, the former by 
 various " notes " making demands which were not 
 complied with. America showed by her repeated 
 protests and warnings that she wished, if possible, to 
 avoid war, and yet would not allow Germany to murder 
 her subjects and terrorise civilians on the high seas.^ 
 
 The policing of the seas by Great Britain and her 
 Allies has partially checked this cruel form of " fright- 
 fulness," and by various means at least a hundred of 
 these pests of the ocean have been destroyed ; in fact, 
 we have sunk or captured them faster than they could be 
 bunt, though there are still many afloat calling at, 
 hovering near, and using American and other neutral 
 ports as a base for their depredations on trading vessels 
 and the ships of the very nations whose hospitality 
 and shelter they have enjoyed. Moreover the German 
 mercantile marine dare not come out to sea, so reprisal 
 is impossible, even if the Entente Powers would deign 
 to adopt such barbarous tactics. 
 
 Assuming that this war were ended, as it will be in 
 due course, and that two small maritime Powers were 
 * See Appendix III. 
 16 
 
216 NEUTRAL NATIONS 
 
 at war, it is impossible to imagine that all the other 
 Powers of the world would allow them to use their sub- 
 marines and mines, as they are now being used bj'' Ger- 
 many, to harm all the neutral or belligerent mercantile 
 vessels of the world as they deemed fit, and to sink and 
 destroy some of them. If they did, the danger to 
 peaceful citizens at sea, the element which comprises 
 the greatest part of the world's surface, would be even 
 greater than it is now, as our fleet would not be mobi- 
 lised, nor that of France, Russia, or Italy, to police the 
 seas and do their utmost to put a stop to this worse than 
 useless mode of warfare — in reality merely a mode of 
 displaying " frightfulness " and hatred. The writer 
 maintains that a merchant vessel of any Power should 
 have, and has, the same rights at sea as it had during 
 the Napoleonic wars. That right by international 
 law should, in the interests of humanity and civilisation, 
 be strictly maintained and adhered to, and a mode 
 should be devised by which its infringement by a 
 belligerent Power be promptly and severely punished. 
 
 What is one to call Greece, a neutral or a non-neutral 
 Power ? That country's cruel desertion of Serbia at a 
 critical time, and its tame surrender of the Greek Port 
 of Ka valla and the military stores contained therein, 
 together with a division of the Greek army, will 
 certainly not read well in history, nor is it approved 
 of by the patriotic Greeks in that kingdom. There were 
 other grave questions between the Entente Powers and 
 the King which it is not in the province of this work 
 to enter. May one hope they will soon be settled. 
 
 Turning to the South of Europe, to Spain, one of the 
 most fertile of European countries, with its vast and 
 varied mineral resources of iron, copper, lead, and other 
 
SPAIN 217 
 
 minerals, its agricultural wealth in vineyards, orange 
 groves, olives, lemons, almonds, pomegranates and 
 dates, and abundant cereals, besides hemp and flax of 
 the best quality, its trade with this country is a steady 
 though not a large one. For many years France and 
 Great Britain were the chief nations with which 
 Spain had trading transactions, now there are other 
 competitors. She derives a good deal of her revenue 
 from her import tariffs, which are high, and spares no 
 effort to protect her manufacturing industries. 
 
 In 1914 we exported to Spain goods to the value of 
 over six million three hundred thousand pounds, mainly 
 coal and coke, machinery, metals of all sorts, ships, 
 chemicals, manure, cottons, and linen, and received in 
 return, to the value of over fourteen million one hundred 
 thousand pounds, her minerals, copper manufactures, 
 fruit, and wines, the last named being only eighth in 
 value of the exports from Spain to the United Kingdom 
 during that year. For the last few years Spain has been 
 pursuing the even tenor of her way, and has, aided by 
 her French and English friends, settled her difficulties 
 in regard to Morocco — whether a certain Government 
 of the "mailed fist" order liked that settlement 
 or not. 
 
 We have a duty on wine entering this country, as we 
 are all aware, and it is important to note that during 
 the latter part of last century we settled a dispute with 
 Spain quite easily and satisfactorily in consequence of 
 the fact that we had that import duty to bargain with, 
 and were not without powers, if need be, of retaliation. 
 The Spaniards had put prohibitory duties on our im- 
 ports to Spain, and to obtain their removal we conceded 
 certain reductions on our customs dues on their wino 
 
218 NEUTRAL NATIONS 
 
 sent into this country — voila tout ; and even the late 
 Professor Fawcett,an ardent Free Trader of his day, and 
 at one time Postmaster-General, said in regard to this 
 particular settlement of this dispute, and said truly : 
 *' A protectionist country is obviously in a much better 
 position to negotiate a commercial treaty than one that 
 has adopted a Free Trade policy." 
 
 Presuming, therefore, that our export trade to Spain 
 had been ten times what it was and was relatively of 
 great importance to a large district in this country, and 
 that we had had no duty on wine, and therefore no other 
 lever to act on their self-interest, by what means, may 
 one ask, could we have induced them to relax their 
 preventive import dues on our commerce ? 
 
 English capital and enterprise have been opening 
 out the immense mineral wealth of Spain in the mines 
 around Bilbao, and the mineral resources of that 
 country have been in a measure opened out, largely by 
 foreign capital, though great undeveloped resources in 
 that respect still remain untouched. 
 
 The Rio Tinto Copper Mining Company in Spain is 
 one of the largest producers of copper in the world. 
 Regarding that mine one recalls an amusing story. 
 A City of London operator in stocks, or — not to put too 
 fine a point upon it — a speculator, had made a large 
 fortune in his dealings in Rio Tinto shares. A friend 
 of his who knew this said to him one day in the City : 
 " Well, how is your copper mine getting along ? " 
 " Copper mine ? " said the successful man. " I have 
 nothing to do with copper." 
 
 "Well," said his friend, "I thought you were 
 interested in Rio Tinto Copper Mine shares ? " To 
 which he replied : 
 
CHINA 219 
 
 " Oh yes, of course I am ; I never knew it was a 
 copper mine ! " 
 
 Regarding the means of communication, the rail- 
 ways already constructed in Spain in 1912 were of a 
 9,161 mileage, and the vessels entered and cleared that 
 year at Spanish ports exceeded forty-one thousand tons 
 burden. The interests, both on land and sea, of the 
 British Empire and the Kingdom of Spain are the same, 
 and are for peace and progressive prosperity. 
 
 China is a storehouse of men and means ; its outer 
 door has scarcely yet been opened. The greater part 
 of its vast area, of over four million two hundred 
 thousand square miles, Avith a population in China 
 proper, and not including Manchuria, Mongolia, Tibet, 
 and Eastern Turkestan, of four hundred and twenty- 
 one million inhabitants, has practically remained to 
 the rest of the world a sealed book and a closed market. 
 
 Should the Chinese authorities decide to relax their 
 barriers, it would be difficult to estimate the important 
 changes that might ensue and the increased com- 
 mercial transactions betwixt China and the rest of the 
 world. In 1915 some steps had been taken to com- 
 mence in reality opening out China by means of rail- 
 ways, and, inclusive of the Manchurian lines, six 
 thousand five hundred miles of railway had been 
 opened, and two thousand five hundred more were 
 either projected or in course of construction. 
 
 A few years ago, all over that country the mode of 
 travelling was to our ideas primitive ; horses were 
 few, and those the people had they used for riding. 
 The country was almost roadless, the means of com- 
 munication by land being narrow, badly paved tracks 
 not suitable for horse-drawn vehicles. Where they had 
 
220 NEUTRAL NATIONS 
 
 not the rivers, and the canals widely dispersed through- 
 out the country, one mode of locomotion was by means 
 of wheelbarrows drawn by men, nor was it an uncom- 
 mon sight to see a Chinese farmer and his wife going to 
 market sitting in one. 
 
 There are now excellent roads in many parts of the 
 country, especially in and near the treaty ports, and 
 the modern motor-car has found its way to what used 
 to be called the Celestial Kingdom. 
 
 That brings one to the fact that China is no longer 
 a Monarchical Empire, as it appears to have been for 
 countless centuries, but a Eepublic. 
 
 In 1911 a revolution broke out, and within a few 
 months the Manchu Dynasty abdicated, and was re- 
 placed by Yuan Shi Kai, who became President of the 
 Chinese Republic. In 1913 the Southern party in 
 China engineered another rebellion, which was, how- 
 ever, suppressed, and great efforts have been made by 
 the President to consolidate his rule and give more real 
 power to the Central Administration of the country. 
 That is a thing much needed, as the old system of 
 affairs amounted to this, that each local government 
 in China became a completely separate entity without 
 any real loyalty, or obligation, to the Central Govern- 
 ment, except the payment of certain taxes, and conse- 
 quently China was a country loosely knit together, and 
 simply, to a great extent, a geographical expression. 
 
 It seems strange that China, whose people are, in 
 reality, the most conservative on the earth's surface, 
 should adopt a republican form of government, and there 
 is no knowing whether it will not, at some future date, 
 resume its monarchical system in some shape or other. 
 
 In regard to the dislike of the Chinese for change, it 
 
EARLY PREJUDICE AGAINST RAILWAYS 221 
 
 may be interesting to refer to one of the first attempts, 
 made about thirty years ago, to lay a short line of 
 railway near Shanghai. 
 
 It appears that certain British merchants in Shang- 
 hai obtained permission from the Government to make 
 a road. They accordingly first decided to lay a tram- 
 way, and then, bolder counsels prevailing, a railway, 
 which, whilst it continued, was not an unprofitable 
 concern. The Governor of Nanking, Shun-pao-Shen, 
 made them a very fair offer for the purchase of this 
 line, and having bought it, had it, to many people's 
 astonishment, taken up and removed to Formosa, 
 where the Chinese authorities considered that it would 
 not assist in regenerating the country — where, in fact, 
 it would be out of harm's way. 
 
 The Governmental arguments against railways were 
 said to be these : " Let the foreigners once make 
 railways, and they will break down all the institutions 
 of this country, destroy our influence, and, possibly, 
 lead to the loss of our independence as a nation. We 
 have not the money to make them ourselves, and should 
 the foreigner do so he will drain the resources of our 
 country in the interest we shall have to pay him for 
 their construction." They did not see then, as they 
 apparently realise now, to a certain extent, that it 
 would tend to increase their wealth tenfold by opening 
 out their country. 
 
 The same idea was prevalent in the early days of 
 railways in this country, in many localities — namely, 
 that the railways would not be a benefit but an injury 
 to the district — and many considerable English towns 
 used all the influence they could bring to bear at the 
 time to prevent the main lines of railway being taken 
 
222 NEUTRAL NATIONS 
 
 through their boundaries. In some instances they 
 succeeded, much to the regret of the present-day in- 
 habitants, as they are only on branch lines with two or 
 three trains a day, and are, in some cases, left in a sort 
 of backwater whilst other places near them, on the 
 main line, have increased in size and importance. 
 
 How different are the Chinese customs in many 
 respects from our own ! White instead of black is the 
 colour used for mourning. The prow of a ship is 
 considered the place of honour, instead of the stern ; and 
 in the latter respect we have, to some extent, recently 
 copied them, as the writer found when crossing the 
 Atlantic on that splendid ship — now, alas! at the 
 bottom of the sea — tlie Lusitania, where the best cabins 
 were forward, most probably in order to get more air 
 and to be farther away from the excessive vibration of 
 the screw when the vessel was going at full speed. Their 
 mode of writing is from right to left, and when warm 
 they fan themselves behind, not, as we do, in front. 
 
 They differ from us more materially in respect to the 
 way in which they esteem agriculture, and they would 
 consider our treatment and neglect of that important 
 industry incomprehensible. In China the farmer's 
 year is solemnly inaugurated, and spring is ushered in 
 by a festival. No farmer is supposed to begin to plough 
 till such ceremonies have been performed. These 
 rites, under the old regime, used to be attended by the 
 governors and administrators of the various provinces, 
 and also by the Emperor himself in person at his capital 
 in Pekin, and they may be carried out still by the present 
 authorities, though of that the writer is not certain. 
 
 Care is taken that the land shall not be allowed to lie 
 fallow. With the view of superintending farmers and 
 
CHINESE LAWS REGARDING LAND 223 
 
 agricultural labourers in their operations, an agri- 
 cultural board is established in almost every village 
 throughout the Empire. This board is presided over 
 by three or four aged agriculturists, upon each of w hom 
 the eighth degree of rank is conferred. It insists upon 
 each farmer cultivating his lands to the fullest extent, 
 and sowing and reaping in due season. A farmer who 
 is negligent in these respects is taken, at the suggestion 
 of the board, into the presence of the magistrate to 
 receive a flogging. The number of stripes is in pro- 
 portion to the quantity of land which he has left unculti- 
 vated. Nor is the law confined to renters. There is a 
 decree which enjoins all landed proprietors to see that 
 their estates are kept in high cultivation ; and the 
 penalty inflicted for a breach of this law is an entire 
 confiscation of the neglected property to the State. 
 Farming in Great Britain and China involves very 
 different outlays. 
 
 In Great Britain it is impossible for a man without 
 capital to enter upon a farm. In many of the pro- 
 vinces of China, however, the reverse is the case, as a 
 Chinese farm — I speak more particularly of the south 
 of China — is without stock. The Government authori- 
 ties frequently receive petitions from poor farmers 
 asking to be appointed tenants of the public lands, as 
 the Government sometimes appoints men who are 
 acquainted with husbandry to farm its estates. Like 
 their masters, the agricultural labourers are very 
 industrious. As in some parts of England, especially 
 at present, women are employed as well as men. Not- 
 withstanding all this care, there is at times, owing to 
 either floods or drought, great scarcity of food in China 
 and consequent famine. 
 
224 NEUTBAL NATIONS 
 
 Regarding punishments, when last in China the 
 writer went to see a Chinese prison at Canton, and 
 found the condition of the prisoners such that they w^ere 
 greatly to be pitied. They lived in cells ; the place 
 was filthy ; they appeared to be without proper clothes 
 or food. The prison system, it is to be hoped, has now 
 been reformed. One man was hung up to the ceiling 
 by cords tied to his fingers and toes, and he was almost 
 insensible with pain ; another was being bastinadoed 
 for some offence or other, and on a remark being made 
 to a Chinese friend to the effect that the rod was bei::>g 
 lightly applied by the jail official, he smilingly replied, 
 in his broken English, " That prisoner man plenty of 
 money has got " 1 Another man was being tried by 
 an official corresponding apparently to our police 
 magistrate, who interrogated him. The prisoner w^as 
 kneeling in front of the magistrate with his back bare, 
 his hands and legs trussed like a fowl, with wooden 
 bars thrust between them securely tied with rope. 
 If in answer to the question this unfortunate man made 
 a reply which the magistrate did not approve of, that 
 official gave a sign, and a jailer applied with great 
 vigour a bamboo rod to the prisoner's back, which 
 caused it to bleed and lacerated it with wounds. The 
 prisoners begged for money, which the visitors were 
 allow^ed to give them, and one hopes that they were able 
 to purchase some extra food with it. All this was very 
 different from the clean and well-ordered prison to be 
 found in British territory at Hong-Kong. 
 
 They have a system of competitive examinations in 
 China, and immense examination halls are dotted all 
 over the country ; each student has a small compart- 
 ment in which he lives during the examination, which 
 
CHINESE COMPETITIVE EXAMINATIONS 226 
 
 lasts for days. In theory a Chinaman can rise to any 
 position, however high, in the State, if he is successful 
 enough in these educational contests, but whether 
 influence there, as elsewhere, has something to say in the 
 matter or not one cannot state. 
 
 The men who go up for examination are locally 
 examined and belong to the same district in the primary 
 tests. That is needful, for though Chinese is written the 
 same all over that Republic, it is so differently spoken 
 and pronounced in various parts of the country as to 
 constitute almost another language, and not merely a 
 different dialect. The common people, for instance, of 
 North China cannot understand the Cantonese from 
 the South, and vice versa. It is said that two com- 
 pradors, or cashiers, one from Tientsin and the other 
 from Canton, both of whom understood and spoke 
 " pidgin " or Chinese English, had to converse with one 
 another in that queer parody of our language or write 
 down what they wished to say ! 
 
 As the reader will be aware, the advance of the 
 Chinese in progress, and their Governmental and other 
 institutions, have everything to do with the immense 
 possibilities which will ensue with the opening out of 
 that immense country to foreign trade and commerce, 
 and for that reason certain aspects of these questions 
 have been here dealt with. 
 
 Turning now to the more prosaic question of trade. 
 In 1914 the Chinese Merchants Steam Navigation Com- 
 pany possessed a fleet of thirty-one vessels of sixty 
 thousand tons burden. The same year the total ton- 
 nage of vessels entered and cleared at the treaty ports 
 in China exceeded ninety-six million tons, or an increase 
 of nearly three million tons burden over the previous 
 
226 NEUTRAL NATIONS 
 
 year. Telegraphs are being constructed all over China, 
 and Peking is already in direct telegraphic communica- 
 tion with Europe. 
 
 Our exports to China of the produce and manufacture 
 of the United Kingdom were to the value of nearly 
 seventeen million pounds sterling in the same year, 
 and mainly consisted of cottons, iron manufactures, 
 and tobacco ; whilst our imports from that country 
 were to the value of five million three hundred thou- 
 sand pounds, and were chiefly tea, raw silk, and, 
 curiously enough, peas and beans. 
 
 In " Whitaker's " the following small though important 
 analysis is to be found of how the foreign trade of China 
 was shared by the nations of the world in 1914 : 
 
 British 
 
 
 Foreign 
 
 
 
 per cent 
 
 
 per cent. 
 
 Great Britain . 
 
 . 12 
 
 Japan 
 
 . 20 
 
 Hong-Kong 
 
 . 28 
 
 U.S.A. . 
 
 9 
 
 India 
 
 4 
 
 Europe (exc. Russia^ 
 
 . 11 
 
 Other Dominions 
 
 2 
 
 Russia 
 
 . 6 
 
 
 
 Other countries 
 
 8 
 
 Total . 
 
 . 46 
 
 Total 
 
 . 54 
 
 That is satisfactory enough as far as the figures go. 
 If the British Empire could always retain forty-six per 
 cent, of the foreign trade of China we should do well 
 enough. It should, however, be borne in mind that the 
 flourishing British Colony of Hong-Kong transacts a 
 large transit trade, and that some part, though probably 
 only a small portion, of the goods sent through Hong- 
 Kong to China, comes from outside Great Britain or the 
 British Dominions. 
 
 In China the foreign residents were numerically 
 (omitting the figures under a thousand) : British, nine 
 
FIRST USE OF TEA AND SILK 227 
 
 thousand ; Japanese, eighty-five thousand ; Russian, 
 fifty-six thousand ; Grerman, three thousand ; and 
 French, two thousand. 
 
 In China, lands are all freehold, and are held by 
 families under the Government on payment of a certain 
 annual tax. These taxes are collected and paid to the 
 National Exchequer by the district rulers, who give 
 a receipt to the landowner ; should the crop be de- 
 stroyedby inundation or the ravages of insects, however, 
 the land tax is according to law not to be exacted, and 
 the mandarins are punished should the}^ under such 
 circumstances, enforce payment. When the farmers 
 have been deprived of their crops by inundation, the 
 representatives of the Provincial Government are 
 authorised to advance money to them to purchase 
 seeds, on the condition of repayment at an expiration 
 of ten years. The Chinese would appear to have in 
 those respects a great sense of equity. 
 
 Tea was used in China as a beverage for hundreds 
 of years before it was introduced into any other country. 
 In Russia and America China tea still maintains its 
 popularity, though in this country not such a large 
 quantity of it is consumed as was once the case. Silk, 
 as we know it to-day, also owes its origin to the Chinese ; 
 for several centuries after the introduction of silk as an 
 article of sale into Greece or Italy it was regarded by 
 some Europeans as a species of down gathered from the 
 leaves of trees, and by others as a very delicate fibre of 
 wool or cotton. An immense amount of that valuable 
 texture from China finds its way into all the markets 
 of the world. 
 
 Pottery, or porcelain as we now call it, was for years 
 always known in this country as " china," because it 
 
228 NEUTRAL NATIONS 
 
 was in that country that it was first discovered how to 
 mix the clays and retain and fix the colours. 
 
 A description of book printing is said to have been 
 executed in China hundreds of years before the printing 
 press was invented in Europe. 
 
 In the painting of porcelain in China, there is, it 
 appears, a division of labour. One artist draws the 
 designs, another paints landscapes, a third rivers, a 
 fourth trees, a fifth butterflies, a sixth birds, and a 
 seventh human figures and buildings. 
 
 Porcelain, and even pottery, from China is now not 
 in general use here, and one seldom sees the famous 
 Willow pattern, or more expensive, ornate, and beauti- 
 fully executed specimens of porcelain, except in ladies' 
 drawing-rooms and museums. It is considered too 
 expensive for general use. The Celestial Kingdom has 
 for hundreds — I might almost say thousands — of years 
 been famous for its bronzes, many of them being of 
 beautiful workmanship and elegant design. 
 
 Amongst the mercantile classes in China a high sense 
 of honour exists ; they nearly all belong to societies 
 or guilds which are willing to go sureties for them in 
 many of their large mercantile undertakings. They are 
 seldom known to go from their word in business transac- 
 tions, though, of course, there are exceptions — where 
 are there not ? A Chinese merchant cannot afford to 
 " lose face," as it is called, and so his word is as good as 
 his bond. 
 
 Unlilie China, in respect to its teeming millions of 
 population, the South American RepubHcs have this in 
 common with that country, a prospect of being, at some 
 future date, among the richest and most prosperous 
 States in the world, when properly opened out and 
 
THE REPUBLIC OF BRAZIL 229 
 
 developed. As yet their vast areas are sparsely in- 
 habited, and except in some parts of the Argentine, 
 Chili, Brazil, and in the vicinity of the cities and larger 
 centres of industry, they are practically untouched by 
 the hand of man. 
 
 Brazil, for instance, is nearly equal in size to the 
 whole of Europe, and has amongst its rivers the 
 Amazon, probably the largest in the world, while the 
 country is intersected by several large and important 
 chains of mountains. 
 
 The climate has been described in the following 
 words — and, except in certain valleys and in the 
 swampy land near some of its rivers, this description, 
 in reference to Brazil generally, from the writer's 
 personal experience of the neighbouring State of 
 Colombia, is a fairly accurate one : " Winter in this 
 country resembles summer in the North of Europe ; 
 summer appears one continuous sprmg, whilst spring 
 and autumn are unconsciously lost in winter and 
 summer." Being not far from the equator, it is, 
 however, in the torrid zone, and that description would 
 apply more especially to the higher elevations of the 
 country. 
 
 All over Brazil, however, one finds great and varied 
 natural resources, and probably the forests are unsur- 
 passed for the variety of the useful and ornamental 
 woods they contain. In addition to this there are many 
 iron mines, although as yet not nearly enough iron is 
 produced to supply the wants of the country, and it 
 must also be added that the diamond mines of Brazil 
 were at one time of very considerable value. The 
 lustre of these diamonds has made them very highly 
 esteemed, and they have a water of great purity. They 
 
230 NEUTRAL NATIONS 
 
 are at present rather rare, and not many are found as in 
 the days when Portugal ruled over that country. 
 
 Cattle-raising is an important industry, the number 
 reared being computed at eighteen millions. Cotton is 
 grown on a fairly considerable scale, and we imported, in 
 1914, over one million seven hundred thousand pounds' 
 worth of their raw cotton to the United Kingdom. 
 
 The chief product which we purchased from Brazil 
 in that year was rubber to the value of three million 
 four hundred thousand pounds. This useful article 
 of commerce comes from the more northern provinces, 
 is shipped from Para and Manaos, and is usually known 
 by the former name. It is mostly collected from the 
 indigenous wild rubber trees of Brazil, though a certain 
 proportion of plantation rubber trees are grown. It 
 is famous for its extraordinary durability and flexible 
 qualities, and is, therefore, used extensively for 
 machinery and the tyres of all descriptions of locomo- 
 tives, motor cars, and carriages, for which purpose 
 the softer rubbers from other parts of the world 
 outside South America are not, as a rule, so well 
 adapted. 
 
 Rubber gatherers go into the huge forests on the side 
 of the hills and valleys near the Amazon and collect 
 this rubber. They are, as a rule, a hardy race of men 
 of mixed breed, or pure Indians, and used to the rough 
 and adventurous life which their calling obliges them 
 to lead. Some of the mountains where this rubber 
 is collected border the neighbouring State of Colombia, 
 in which, also, no inconsiderable quantity of rubber is 
 found ; so the rubber-gatherers sometimes take their 
 wares to Colombia and sell them to the merchants there 
 for export to Europe or America. The Amazon is the 
 
BRAZIL'S POPULATION AND TRADE 231 
 
 great highway of Brazil and it carries an excellent 
 service of steamers. 
 
 Coffee and cocoa are also grown largely in the North 
 of Brazil, and of the former we purchased to the value 
 of nearly one million pounds sterling in 1914. The 
 latter is used greatly in the country itself, as well as 
 for export. 
 
 Our exports to Brazil consist of nearly every descrip- 
 tion of manufactured goods which we make, as well as 
 coal and coke ; of the former, cotton and iron goods 
 were the chief articles we sent them in 1913. 
 
 Although, no doubt, there are a vast number of in- 
 dustrial establishments in Brazil, and there were a few 
 years ago no less than one hundred and sixty-one cotton 
 mills, still the possibilities of English manufactured 
 goods being more extensively used in Brazil are great — 
 despite the fact that their tariff is a high one and has 
 been in recent years increased — provided our merchants 
 and manufacturers study the requirements of the 
 people. 
 
 The country lacks a sufficiently large population, 
 considering its size, to develop its resources, the number 
 of inhabitants being estimated to be about twenty-one 
 and a half million, and moreover the population, besides 
 being composed of several races, is not by any means 
 of the most industrious character. The planters, 
 mostly of Portuguese extraction, form a sort of nobility. 
 There are, besides, mulattoes, the offspring of Europeans 
 and negroes, also large numbers of negroes and Creoles, 
 in addition to a native Indian population of about one 
 million. The aborigines are of a bright yellow-copper 
 colour, short, robust, and well made. They are in an 
 extremely low state of civilisation, their sole occupa- 
 17 
 
232 NEUTRAL NATIONS 
 
 tions being, in most instances, rubber gathering, fishing, 
 hunting, and the culture of manioc and bananas. 
 
 There are numerous and constant lines of steamers 
 running from this country, the United States, and 
 France, to Brazil, and before the war others ran from 
 Germany. No effort is being spared by the competing 
 great commercial nations of the world, moreover, 
 to develop further theii- trading relations with that, at 
 present, very partially developed country. 
 
 The Argentine, another great South American State, 
 nearly six times as large as the United Kingdom, has 
 a population of under eight million people. Despite 
 this paucity of population in proportion to its area, 
 this country has not by any means remained stationary 
 in the last forty years, far from it. In 1878 we pur- 
 chased from it goods to the value of about £1,000,000 ; 
 in 1914 that had increased to over £37,200,000 in value, 
 of which fifteen millions were imports of beef and 
 mutton, and thirteen millions corn and other cereals. 
 
 These are startling figures, and show a great increase 
 of prosperity in the Argentine. In 19U they had a 
 stock of no less than twenty-nine million cattle, eighty 
 million sheep, and nine and a half million horses, besides 
 mules. 
 
 The figures of our exports as compared with 1878, 
 are almost as indicative of advancement ; in that j^ear 
 we sold them goods to the value of about £2,300,000, 
 whilst in 1914, although this great war had commenced 
 in August, our exports to the Argentine were of the 
 value of £14,600,000, or more than six times greater. 
 
 Who can say, if that country progresses as it should, 
 what its condition will be in a generation, or in forty 
 years' time ? There will, no doubt, be a great increase, 
 
CHILI 233 
 
 always provided we show the same concerted energy 
 as many other nations in encouraging their trade and 
 commerce. 
 
 The increase of the railway system in the Argentine 
 in the last thirty-eight years has been from a mileage 
 of 1,409 to that of 21,800, and many lines are being made 
 or are projected. One of these goes right across the 
 Continent of South America, starting from the attrac- 
 tive " Paris of South America," as it is called — Buenos 
 Ayres ; a wealthy, large, gay and exceedingly expensive 
 city of palatial buildings, affording its wealthy inhabit- 
 ants every luxury man can desire or art and skill can 
 contrive. It is said that in no part of the southern 
 portion of America does an Englishman find himself 
 more at home, or stand a better chance of getting on, 
 than in Chili. The independence of that country was 
 nobly striven for by Lord Cochrane, and his deeds 
 still live in the memories of the inhabitants ; hence the 
 prestige which clings to the English name in that region. 
 
 The natural features of this country have, in some 
 measure, been of great advantage, as they have ren- 
 dered almost impossible the constant revolutions and 
 " pronunciamentos " to which the other States in South 
 America have been subjected. Chili extends in a long 
 narrow strip along the western shores of South America, 
 and in no part does the breadth of this State much 
 exceed one hundred and twenty miles, whilst on the 
 east it is bounded by the great Cordillera of the Andes. 
 Whether it is owing to the fact that its Government 
 has been able by means of the sea to communicate 
 with every part of the country, or to other reasons, 
 it has certainly kept singularly free from internal strife. 
 
 In Southern Chili the gTeat mountain range above- 
 
234 NEUTBAL NATIONS 
 
 named rises to a mean elevation above the sea of about 
 thirteen thousand feet, although many peaks are of a 
 greater height. Several of them are volcanic, and 
 shocks are felt in the country almost daily. These, of 
 course, are usually very shght, but there have been 
 earthquakes of such violence in Chili that their recollec- 
 tion will not yet have faded from the mmds of the people. 
 In the whole Cordillera of the Andes, extending from 
 Mexico through the greater part of South America, 
 these seismic disturbances of the earth's surface occur 
 from time to time. 
 
 This country is particularly rich in minerals, the 
 principal of which is copper. Her chief commodity of 
 export is nitrate of soda, of which she sent to this 
 country, in 1914, quantities of the value of over one 
 million six hundred thousand pounds. Grain, tin, 
 copper, and chemicals are also imported here from Chili 
 in large quantities, whilst she purchases coal, textiles, 
 and manufactured iron from our merchants, and even 
 before the opening of the Panama Canal, in 1912, was 
 served by six lines of steamers between Panama and the 
 Magellan Straits and other parts of the world. 
 
 The demand for the corn and grain of Chili does 
 not appear large in comparison with what we obtain 
 from the Argentine, for instance, still it is considerable. 
 Regarding that, it is interesting to note the following 
 from The Trade of the World, which has been previousl}^ 
 referred to — and one hopes that, in this respect, history 
 will repeat itself when this great war ends, as the wastage 
 of war and loss in many ways, such as the breeding 
 stock of cattle, railways, ships and buildings destroyed, 
 and in other directions, must be twenty times greater 
 than it was in 1871 : 
 
A CITY OF CONTRASTS 235 
 
 "The demand for Chilian cereals in the markets of 
 Europe is not so great as it was just after the Franco- 
 Prussian War, at which time large fortunes were made 
 by the planters of that State." 
 
 The capital, Santiago, contains a population of over 
 three hundred and fifty thousand people, and appears 
 to attract the larger proportion of the wealthier in- 
 habitants as residents. There the rich planters settle, 
 leaving their stewards to look after their estates in the 
 country, and many of them become, in fact, non- 
 resident landlords. 
 
 It is said that a first visit to the city of Santiago 
 cannot but be a matter of agreeable surprise to an in- 
 telligent European, but after a more lengthened stay 
 the ambitious growth and luxury of the town will 
 probably seem to him out of due proportion to the 
 power and resources of the country of which it is the 
 capital. One is, indeed, scarcely prepared to find 
 ninety miles inland at the foot of the Andes a city with 
 so many inhabitants, with such handsome public build- 
 ings, stately dwelling-houses, and exceptionally fine 
 promenades. What, perhaps, strikes the stranger 
 most, next to the marvellously beautiful situation of 
 the town, is the atmosphere of aristocratic ease and 
 exclusiveness pervading it. It is also a place of ugly 
 contrasts, for the hovels of the poor are contiguous to 
 the mansions of the rich, and not, as in some other 
 cities, a certain distance away from them. 
 
 Another Republic in South America whose natural 
 resources are great, but as yet very little developed, 
 is the Republic of Colombia, which has an estimated 
 area of 461,000 square miles and a population of about 
 
236 NEUTRAL NATIONS 
 
 five and a half million people. It may be described as an 
 irregular area occupying the extreme north-west corner 
 of the South American Continent, bounded on the north- 
 west by the new Republic of Panama, on the west by 
 the Pacific, on the north by Ecuador and Peru, on the 
 east by Brazil and Venezuela, and on the north by the 
 Caribbean Sea. 
 
 The Republic of Panama was a few years ago one of 
 the States of Colombia itself. The United States, 
 wishing to complete the Panama Canal, which was 
 begun by the French, offered the Government of 
 Colombia a payment in cash for the right to make a 
 canal through the Isthmus of Panama. As far as one 
 could make out, the offer was a liberal one, and the 
 Government of Colombia appeared willing to accept 
 it, but it had to be also agreed to by their legislative 
 body, who, like other bodies of a similar kind nearer 
 home, had reduced procrastination from an art into a 
 positive science. At length both the local inhabitants 
 of the then State of Panama, who wished a canal cut 
 through the isthmus, and the United States authorities, 
 got weary ; the former revolted from Colombia and 
 formed themselves into a separate Republic, coming 
 quickly to terms with the Americans, who have since 
 completed the Canal. They constructed it in a most 
 methodical and thorough manner, and by their careful 
 sanitary precautions the loss of life was comparatively 
 small among the workers on that gigantic and wonderful 
 piece of engineering with its enormous cuttings and 
 Brobdingnagian locks, which it has been the writer's 
 lot to see twice during its construction. Naturally the 
 Colombians are rather sore about losing this State, or 
 were as late as 1911. 
 
THE REPUBLIC OF COLOMBIA 237 
 
 Colombia's mineral resources are very varied and 
 extensive throughout its confines, and include emeralds, 
 gold, silver, platinum, copper, lead, iron, and coal. It 
 possesses the most magnificent forests with abundance 
 of splendid timber growing in them, including mahog- 
 any, cedar, dye woods, rubber, and a variety of hard 
 woods suitable for cabinet-work, road paving, sleepers 
 for railways and building purposes. It is watered by 
 splendid rivers, including the Magdalena, Cauca, etc., 
 the former running north and south through the country 
 from the coast towards the capital, Bogota, which is 
 situated on a plateau nine thousand feet above sea-level, 
 80 that on leaving the steamer one has to travel up by a 
 mountain railway to the capital — a mode of travelling 
 which has superseded the old method of gomg there by 
 mule over badly paved and almost impassable roads. 
 
 Nearly every tropical and semi-tropical plant and 
 vegetable grows luxuriantly in the rich soil of this 
 country, as well as cereals, and it is an excellent place 
 for rearing cattle and horses. The chief trade in 
 Colombia prior to this war was done by German firms, 
 and the British Consul at the chief port of Barranquilla 
 was a German ! The trade with Great Britain was about 
 one millio7i pounds sterling in value in imports from 
 Colombia and the same amount in exports to it. Their 
 import tariff is not so high as in many South American 
 countries. 
 
 Coffee forms a large part of the export trade from 
 Colombia to Europe and America, also indiarubber and 
 gold and silver from the mines, mostly worked by 
 English capital. 
 
 Some day or other this will be one of the wealthiest 
 countries in the world ; at present it moves very slowly ; 
 
238 NEUTRAL NATIONS 
 
 railways, and, in fact, progress there in all directions 
 are in their infancy . 
 
 Want of space precludes any further description of 
 Colombia's possibilities. Like all the other Latin 
 Republics in South America, she has escaped the in- 
 sensate folly of internal turmoil and revolution for the 
 last fourteen or fifteen years, and it is to be hoped that 
 this satisfactory state of affaii's may long continue. 
 
 A few words about Mexico before leaving the subject 
 of the Latin Republics. Under the firm rule of Diaz, 
 for well-nigh a generation that country was peaceful 
 and prospering. Foreign capital, largely from this 
 country, was building fine trunk lines of railways and 
 other important works in the country. All that un- 
 fortunately ceased in 1910-11 and anarch}^ supervened. 
 
 The " hands off any part of America," or Monroe, 
 doctrine is presumably a sound one for the peace of that 
 continent, but the United States have duties regarding 
 it as well as privileges, and Mexico is a question that 
 sooner or later they will have to see to and straighten 
 out, for it cannot be left an Alsatia of riot and blood- 
 shed indefinitely. Some of the inhabitants contend 
 that with thorough development this country might 
 compete with Cuba in the production of sugar, coffee, 
 etc. ; be that as it may, notwithstanding the richness of 
 the soil and the wealth of the silver and copper mines, 
 one finds that — quoting the words of a former Mexican 
 Minister of Foreign Affairs — " Chronic anarchy here 
 produces the phenomena of humiliating poverty in the 
 midst of elementary riches." What is the cause of 
 this ? To put it briefly, one word will explain it, and 
 that word is " Revolution." 
 
CHAPTER VII 
 
 THE CENTRAL EUROPEAN POWERS 
 
 ** War in the future will be an economic affair, a struggle for 
 existence on a wholesale scale. I hope my successors will always 
 keep that fact in view." — Bismarck. 
 
 Turning our eyes next to the Central European Powers, 
 with whom we are now opposed in a deadly struggle for 
 all we hold dear, we must remember that we only 
 declared war after Germany's violation of a treaty bind- 
 ing her to maintain the independence of Belgium which 
 had been solemnly entered into on Germany's part. 
 Stealthily and with Machiavellian cunning that nation 
 had been undermining our strength and sapping the 
 economic foundations of our trade and industry for 
 several decades, organising the attack m all parts of our 
 Empire, in order, if possible, to tear it asunder for her 
 own profit ; this whilst the German people were enjoying 
 its hospitalit}^ and the same privileges as ourselves 
 within its bounds. 
 
 The question of our after-war economic treatment of 
 our present foes, and more especially Germany, is one we 
 cannot lightly dismiss, and it will require the gravest 
 consideration on the part of our statesmen and those 
 of our Allies. There are many important matters 
 which will have to be seen to in due season, such as the 
 
 239 
 
240 THE CENTRAL EUROPEAN POWERS 
 
 trend of their trade, also their organisation for peaceful 
 penetration, and dumping of goods ; their scheme for 
 capturing our " key industries," their bounty system 
 to their merchandise and shipping, and also their high 
 Protective Tariff. Whatever else the last may have 
 done, it has made them a much more self-contained 
 people, so far as food and the main necessaries of life 
 are concerned, than we are. 
 
 Prior to the inauguration of this tariff, in 1879, Bis- 
 marck, in introducing this measure into the German 
 Reichstag, said ; 
 
 " We refuse to remain the sole dupes of an honourable 
 conviction. Through the widely opened door of our 
 imports we have become the ' dumping ' place of foreign 
 surplus production, and it is this, in my opinion, that 
 has prevented the continued development of our 
 industry and the strengthening of our economic con- 
 ditions. Let us close our doors awhile, and secure for 
 German workers the German market, which hitherto 
 the foreigner has exploited with our connivance. The 
 abstract doctrines of science influence me not at all ; 
 I form my verdict on the teachings of experience. I see 
 that the Protectionist countries are prospering, and that 
 the countries which practise Free Trade are decaying. 
 
 " Since we lowered our tariffs we have, in my opinion, 
 been a prey to consumption. We have been bleeding 
 to death. The process was delayed for some years by 
 the French millions." 
 
 And also about the same time Bismarck, in a con- 
 fidential circular to the Prussian Ambassadors the year 
 before the adoption of the present protective policy of 
 Germany in 1879, clearly defined his opinion regarding 
 the actual payer of the import duty : 
 
CUSTOMS DUES BORNE BY PRODUCER 241 
 
 " As the fact that foreign countries always show the 
 greatest concern if another country desires to increase 
 its duties, it can be seen that such Customs duties are, 
 to a very large extent, borne by the foreign p'oducer, arid 
 not by the consumer. If the home consumer should 
 really have to bear the weight of increased duties, such 
 an increase would leave the foreign producer in- 
 different. Under a system of protective tariff, the 
 Empire will therefore derive part of its income from 
 foreign countries." 
 
 Germany then carried out the policy advocated by 
 her great economic writer, Liszt. He T^as origmally 
 a believer in the popular theory of Free Trade, but he 
 also held that the prosperity of a nation did not consist 
 in amassed Avealth, but was in proportion to its powers 
 of production ; that a nation is able by moderate 
 protective duties to build up productive strength as a 
 great agricultural self-contained Power, and also its 
 manufacturing industries, and to produce the domestic 
 article as cheaply and as good as or even more cheaply 
 than the imported article. Lessons which he also 
 thought it wise to ponder over could be learnt from 
 the decay of ancient nations, especially those which, 
 like the Greeks, had become merely traders, and had 
 considered the interests of the home producers as of 
 secondary importance. He also held that it was the 
 duty of the economist not to be hide-bound by ancient 
 shibboleths, but to look at facts as they stood in the 
 actual world we are living in. 
 
 He also considered that the arguments of Adam 
 Smith, which depended on the assumption of universal 
 peace and universal association and brotherhood 
 amongst nations, were economic theories based upon 
 
242 THE CENTRAL EUROPEAN POWERS 
 
 premises completely untenable. In fact, the views 
 of nearly all the German statesmen and economists are 
 in direct opposition to those held by a large section of 
 our fellow-countrymen, though that section is not so 
 large as it once was. German}^ is unanimous in the 
 conviction that, economically spealdng, no country 
 should be dependent upon another for food and the 
 chief necessaries of life. This fact has proved to be 
 to the advantage of the German cause at the present 
 time. They have also taken steps to encourage their 
 manufacturing interest, and it is forbidden to order 
 goods from foreign firms when similar products are 
 purchasable in Germany. 
 
 We, on the other hand, have for long held the con- 
 trary opinion. Our Government, railway companies, 
 municipalities, and other public corporations buy all 
 they require in the cheapest market, regardless of 
 consequences. That has applied, though not so 
 markedly, to those parts of the Empire not controlled 
 from Downing Street, in Canada, in Australia, and in 
 other self-governing colonies. 
 
 The manufactures of the Central Powers were well 
 organised before hostilities commenced, and had 
 framed State regulations to meet the contingency of 
 war, therefore their works had not, as ours had, to be 
 turned inside out by a Minister of Munitions or by any 
 other public functionary. They are also said to have 
 been given good warning beforehand to prepare for 
 emergencies. Their shipper is usually an export agent 
 to a whole group of manufacturers. He informs them 
 of the exact requirements of their customers ; he 
 advises one manufacturer to concentrate his energies 
 on one article, and another to specialise in another 
 
GERMAN LINKED COMPANY SYSTEM 243 
 
 class of goods. Thus he eliminates competition, and 
 enables them to undersell the British trader. That is 
 one of the secrets of the capture by Germany of many 
 foreign markets, notably in South America. 
 
 Presuming that the German group decide to build a 
 railway, say, in Africa or in any other part of the 
 world, they link themselves with a group of allied 
 and supplementary industries, and form what is called 
 a " Linked Company System." They jointly pay all 
 expenses connected with the concession, therefore 
 their railway concessionnaires not only build the rail- 
 way with their own capital, but obtain from the 
 Fatherland the rolling-stock, the machinery, the light- 
 ing plant, and so on. As the country is developed, all 
 the imported requirements of the inhabitants are 
 entirely supplied by home firms. No other nations, 
 British or any other, are allowed to have a look in any- 
 where, if it can be prevented. If, as in some cases, a 
 small concession is allowed to a foreign trader to supply 
 some commodity, it is very often for the reason that the 
 Linked Company group do not desire to do so them- 
 selves. It is a complete manifestation of the powers of 
 combined organisation, and, of course, succeeds in de- 
 feating our more easy methods of individual enterprise. 
 
 The Council of the British Engineering Industry are 
 considering the problems in regard to this system. By 
 this means Prussia and her feudatory German States 
 have developed their carrying trade, and also by a 
 system of scientifically arranged subsidies have assisted 
 the sale of their manufactures. One must acknowledge 
 that Germany has a body of intelligent statesmen, who 
 have done all in their power — with considerable success 
 — to encourage German trade and commerce. 
 
244 THE CENTRAL EUROPEAN POWERS 
 
 In the course of a speech in the House of Commons 
 delivered in 1916, Mr. Runciman, then President of the 
 Board of Trade, said : 
 
 " Before the War a large number of articles were 
 almost entirely in German hands, such as dyes, electrical 
 apparatus in some particulars, and several others I 
 could name, including certain of the best chemicals, 
 magnetos, optical glass, etc., which were all of great 
 importance to us, not only as a great commercial 
 country, but as a fighting country. We were placed 
 at a great disadvantage, and never again should that 
 happen." 
 
 This statement is satisfactory so far as it goes, but 
 does it simply express his opinion, or has it any chance 
 of being actually carried into practice ? Prohibition of 
 these articles was proposed by certain supporters of 
 the late Government, but this policy would not carry 
 into effect the words " Never again should this 
 happen," as Prohibition is, of course, only suggested as 
 a temporary measure. The only way to carry them out 
 effectively is for our statesmen to grasp the nettle, and 
 acknowledge that the Free Import sj'stem which we 
 have is not a practical one for a commercial nation in 
 the twentieth century, whatever it might have been 
 when inaugurated seventy years ago. 
 
 In the course of the same speech the same speaker 
 also advocated a large expenditure on technical colleges 
 and modern appliances, and urged that we should be 
 more adaptable. He also indicated that further com- 
 mercial banking facilities would play a large part in re- 
 gard to holding our own against the Prussian Combine. 
 
 All those things, technical colleges, banking facilities. 
 
GERMANIC PENAL TABIFF 245 
 
 etc., would read very well in a thesis on how to encour- 
 age British industries, and they would be, no doubt, 
 useful adjuncts to our industry if we had equality of 
 competition with our foreign competitors. But one 
 fails to see their power to prevent the dumping of goods, 
 or the insidious modes in which the Germans attacked 
 our " key industries," or the penal tariff they put up 
 against our manufactured goods, whilst allowing coal 
 and iron, those useful products which Nature has 
 bestowed upon us, to go into their country on payment 
 of comparatively moderate duties. The remedies 
 suggested above are only palliatives, and not adequate 
 to meet the difficulties that we shall have to face. We 
 have thrown open our market freely to the manu- 
 factures of Germany, whilst year by year she has in- 
 creased her tariffs and made them more preventive 
 against our exports. 
 
 The Germans as a nation are not pioneers in inven- 
 tion, except in the regions of chemistry and in certain 
 branches of medical science. Some people imagine 
 that they were the inventors of undersea vessels or sub- 
 marines : that is quite a mistake. These vessels were, 
 as a matter of fact, first made practical use of by the 
 French at the beginning of this century. A few years 
 afterwards they were adopted by ourselves, and were 
 last of all taken up by Germany, the weaker Power 
 at sea. There is, indeed, scarcely a branch of in- 
 dustry in which Germany has not benefited by trading 
 on ideas which have been the product of Anglo-Saxon 
 genius, either on this or on the other side of the Atlantic. 
 In medical science she has made some discoveries, no 
 doubt : for instance, the brilliant work of Pasteur, the 
 bacteriologist, was carried to useful fruition by Pro- 
 
246 THE CENTRAL EUROPEAN POWERS 
 
 feasor Robert Koch, who adopted the usual Prussian 
 plan of making a practical use of this newly acquired 
 knowledge. 
 
 Amongst the things that one can learn from the 
 German people is the effective mode of preparing both 
 men and women between the ages of 14 and 18 for 
 after-life. A very large proportion of the population 
 is given a comprehensive trade education, in its wider 
 sense, to fit them for the battle of life, and youths of 
 that age are not allowed, as here, to make an easy 
 living in some blind-alley loafing occupation as golf 
 caddies, errand boys, etc. This is a source of strength 
 to modern Germany, and it should be wisely copied m 
 other lands. It creates an incentive to thoroughness 
 in work, and the idea that it is a duty to the State to be 
 an efficient worker. Dr. Emil Lederer states, it may be 
 noted, "that the removal of all men capable of bearing 
 arms in Germany has smashed industry to atoms for 
 the time being." 
 
 jVIany of us have never realised that the Kaiser, 
 Bismarck, and other national statesmen have established 
 in their country by degrees a gigantic system of State 
 Socialism such as the world has never seen before, 
 organised and created for the sole and definite object 
 of making Germany the dominant military, naval, 
 industrial, and commercial country of the world. 
 
 The leading men are now devoting their energies, 
 apart from the war, to creating an economic Zollverein 
 of the Central European Powers. They are making 
 efforts, by means of the mailed fist and in other less 
 strenuous diplomatic ways, to establish a Customs 
 Union from Hamburg to Bagdad. This idea has been 
 germinating in their minds for many years past, and 
 
INDUSTRIAL WARFARE 247 
 
 has been the motive of the wide extension of their 
 trading system amongst the Central European Powers, 
 efforts having been made in all their treaties to exclude 
 the products of Great Britain, and of the British 
 Empire, from entering into the countries with which 
 the treaty has been made. 
 
 With regard to this Central European Association 
 a meeting was held at Vienna in December 1915, in 
 which it was resolved that reciprocal economic treat- 
 ment of the people of Central European States should be 
 arrived at. " It must embrace," so the statement ran, 
 " as far as possible all aspects of economic life." The 
 scheme will, at the same time, be found difficult, if not 
 impossible to carry out, as there are between Germany 
 and Austria-Hungary certain divergences of interest 
 to bo overcome, and the latter will be also unwilling, 
 one would thmk, to place herself even more directly 
 under the domination of the Prussian interest. Turkey 
 will not join in the scheme either with willingness or 
 enthusiasm. Still, we must remember, as the blindest 
 of pro-Germans must see, that as Germany cannot 
 win the war, she will spare no effort to conquer the world 
 commercially and from an industrial standpoint, by 
 means of certain agreements, which she will try to 
 wring from the Allies, if possible — of such a descrip- 
 tion as to sow dissension amongst them. If the war 
 terminates in a treaty of peace, and not, as we feel it 
 should, with a statement of the Allies' terms that 
 Germany will have to accept, she will probably offer 
 very generous terms in the treaty, knowing well that any 
 agreements she enters into are only " scraps of paper " 
 which she can at her will, as opportunity arises, denounce 
 and throw aside. 
 18 
 
248 THE CENTRAL EUROPEAN POWERS 
 
 In Germany, one must also remember, the whole 
 economic armoury of the State is utilised for forging a 
 way amongst the competing nations of the world. 
 The Director of one of the great Prussian shipping com- 
 panies is, for all practical purposes, the Kaiser himself. 
 When the war ends, the Central European Powers will 
 require to export, because they have a paper currency, 
 in order a keep up the value of their exchange. It is 
 unwise to be deluded by any sudden fall, at present, in 
 the value of the German mark. If, just now, they are 
 only importing a small quantity of goods, but exporting 
 a very much smaller quantity, the exchange will fall, 
 but that is only a drop in the ocean of their total trade, 
 internal or abroad. The former is carried on by means 
 of a paper currency, and, therefore, the fall of exchange 
 at the present moment is really of small account. 
 What really would matter to them would be an effective 
 British blockade, and Holland and the States surround- 
 ing Germany being prevented from exporting goods 
 across their borders. Amongst the bulky articles 
 Germany requires are copper and rubber, besides wool 
 and fats. The British blockade keeps the bulk of 
 these goods from her shores, and their shortage 
 daily increases. 
 
 Some of our statesmen and Chambers of Commerce 
 have awakened to the urgency of the question, and are 
 determined to do all in their power to preserve our 
 trade. The British Imperial Chamber of Commerce 
 passed the following Resolution, amongst others, in 
 June 1916 : 
 
 " That legislation should be enacted by the different 
 Governments within the British Empire under which 
 
ACTION OF CHAMBERS OF COMMERCE 249 
 
 each Government should have the power to insist on any 
 individuals, firms, or companies, producing, manu- 
 facturing, or trading within the British Empire, being 
 British-controlled both as regards management and 
 ownership. Also that m the event of enemy companies 
 or firms being permitted to reopen or commence trading 
 in any part of the British Empire, they should be sub- 
 ject to such control and inspection as shall make it 
 impossible for them to be used as political agencies 
 under the guise of industrial establishments." 
 
 They also, together with other Resolutions regarding 
 our fiscal relations, passed the following : 
 
 "For restricting by tariffs and otherwise trade 
 relations with all enemy countries, so as to render 
 dumping or a return to pre-war conditions impossible." 
 
 They have seen the results during this great war of 
 our economic system and that of Germany, and have 
 marked how much more efficiently their system has 
 stood the supreme test of war than ours. Not only 
 was Germany in times of peace under the protective 
 system inaugurated in the seventies of last century 
 rapidly catching us up as a trading nation, and in some 
 branches of mdustry outstrippmg us, but in 1913 her 
 total imports and exports were only one hundred 
 milHon pounds sterling short of our own total trade. 
 
 With the advantage of having a great Empire behind 
 us, and the virtual command of the seas for over a 
 hundred years, we have been handicapped by our free- 
 import system of trade and the loss of any bargaining 
 power, being only just able to keep ahead of the com- 
 mercial position in which Germany has won for herself 
 in the forty years prior to 1914. 
 
250 THE CENTRAL EUROPEAN POWERS 
 
 There are, however, some amongst us who wish to 
 re-establish as soon as possible Germany's ascendancy 
 in British markets, in order that she may be able to pay 
 the war indemnities fixed by the Allies. Such a policy 
 is too fatuous to require refutation by argument. 
 
 One of the clearest evidences of British determina- 
 tion to have no more of the system of squeezing their 
 manufacturers and producing classes for the benefit of 
 other peoples was the defeat of a Free Trade Resolu- 
 tion in the very Mecca of that faith — Manchester. So 
 annoyed were the minority at this defeat that they 
 actually gave a banquet in London to some of the 
 Minority Members of that Chamber, when speeches of 
 obdurate pride and steadfast hate were made in defiance 
 of their defeat, which, one of their speakers said, was 
 caused by " too anti-German feeling," — in other words, 
 that the defeat of Free Trade in Manchester was in 
 reality the defeat of the Germans themselves. Free 
 Traders may not realise it, but if Mr. J. M. Robert- 
 son, M.P., and others had thek own way in the manner 
 their speeches indicate, viz. " business as usual after 
 the war," and if the " most favoured nation " clau.^es 
 in the treaties now existing were allowed to stand, they 
 would simply put us back into the position of being 
 unable to prevent peaceful penetration by the foreigner, 
 and we should have repeated at some future date the 
 painful and humiliating experience we had in 1914. 
 In addition those industries which have been started 
 since the war would be killed, and would have no power 
 of permanent recuperation. 
 
 At the last general election, in 1906, whilst takuig 
 an active part in supporting the Unionist candidates 
 in Westmorland and Manchester, it came to the know- 
 
GER^L4N PRE-WAR PROGRESS 251 
 
 ledge of the author that Free Trade advocates said, 
 " You dare not change your system of tariffs in this 
 country, for if you do, Germany will declare war on 
 you," or words to that effect. War has not been pre- 
 cluded although we still adhered to the old system. 
 
 They further pointed out the pitiable plight which, 
 they said, German workmen were in under Protection, 
 being fed on black bread, dog's flesh and horse's flesh, 
 clothed in rags, usually miserably paid, and living in 
 wretched hovels. Anyone who had been in Germany, 
 either in the north or in the south, knew this to be a 
 pack of falsehoods, but such statements were found to 
 be good enough to win votes and elections, and they 
 were afterwards referred to in the House of Commons 
 by one of the Ministers who had benefited by them, 
 viz. Mr. Winston Churchill, as " terminological m- 
 exactitudes ! " 
 
 The pay really given to German workmen when 
 times of peace prevailed was in certam mdustries 
 higher than that which prevails in England. In the 
 clothing trade, for instance, wages are said to be lower in 
 London than in Berlin. Since the adoption of a higher 
 protective policy in 1897, the progress of Germany 
 towards prosperity has been marvellous. Both Ger- 
 many and the United States have passed us in the 
 production of iron. Delegates from British wool and 
 textile industries in 1908 were astonished to find the 
 German workers well conditioned and circumstanced, 
 and they reported that in some cases weavers received 
 in Grermany 12 J per cent, more for their work than the 
 best similar workers do in Yorkshire factories. 
 
 Having such large indirect taxation, mainly paid 
 by those who import goods into Germany, there is less 
 
252 THE CENTRAL EUROPEAN POWERS 
 
 requirement for direct taxation in Germany, therefore 
 the German worker only pays half the rates and taxes 
 that have to be paid here. It is, in fact, very difficult 
 to understand why, considering their increased com- 
 mercial success in the last thirty years, they ever went 
 to war at all, or what they thought they could gain 
 more than they already received as a result of our 
 generosity. 
 
 In the year 1913, the last complete year's trade before 
 the war, the total export trade of Germany reached the 
 value of £1,026,000,000 sterling : 20 per cent, of this 
 came to this countrj^ and 28 per cent, went to our 
 Allies ; in other words, 48 per cent., or nearly half, went 
 to the nations now arrayed against her ! Therefore, 
 and with justice, the fear of a united conclave of 
 nations refusing to open their markets again freely 
 to her commerce must cause grave apprehension in 
 German business circles ; for even if she induces 
 Austria-Hungary, Turkey, and Bulgaria to enter hito 
 a commercial Zollverein^ that would make but a small 
 counterpoise to the loss of her trade with the Allied 
 Powers. 
 
 Go to any of our great centres of industry in this 
 country, and see how well and how thoroughly as in- 
 dividual firms many of our manufactures are organised. 
 That system has been extended by Germany to the 
 whole nation. We must take a lesson from her, and 
 realise the advantage of systematic organisation in 
 respect of commercial and industrial matters, knowing 
 that to that fact the success of the German people 
 in recent years is greatly due. If we do that, and 
 organise in the same way, we shall increase the 
 economic power of our industries to a great extent. 
 
THE IDEALS WE ADHERE TO 253 
 
 Before the war Germany was the only well-organised 
 nation in the world. She also determined to push out 
 of her path all who stood in her way to complete mastery 
 and dominance in the world. That ideal was followed 
 not only by the Government, but by the vast majority 
 of the people in that great nation, and to this end they 
 devoted their whole energies in life. There was no 
 divided control, and all had to act as they were told 
 without scruple, mercy, or compunction. We, however, 
 in copying them in organisation, will determinedly 
 adhere, not to the doctrines set forth by Bernhardi, or 
 men of that stamp, but to our own ideals of Truth, 
 Honour, and Justice. 
 
 Among other products which we imported from 
 Germany was timber for the manufacture of pulp ; and 
 we have certamly realised during this war the incon- 
 venience of our cosmopolitanism in respect of that 
 import, of which product we had ample supplies 
 withm the Empire. An investigation has lately been 
 made by the Board of Trade as to the possibility of our 
 holding our own in neutral markets in competition 
 with German goods. The British cotton goods, which 
 our merchants exported to warmer climates, such as 
 Australia and India for instance, were harsher than 
 those supplied from Germany. They would wear 
 better, no doubt, but the inhabitants of those places 
 did not like them so much, as they were not so soft to 
 the skin, though quite as low in price as the German 
 goods. Amongst the largest items of German exports 
 in 1913 to the United Kingdom, Turkey, Roumania, 
 British India, South America, United States, China, 
 Japan, and Egypt, were woollen and worsted tissues, 
 which they sent to the large value of £13,500,000 stg., 
 
254 THE CENTRAL EUROPEAN POWERS 
 
 and the Board of Trade appears to be of opinion that 
 the British manufacture could gain a great portion of 
 that trade if it would consent to consider local needs 
 and local conditions. 
 
 Throughout Germany railways have been laid, for 
 the most part for strategic reasons — to oppose, so to 
 speak, Railway Power to Sea Power ; and these have, 
 no doubt, been of great advantage to the German 
 Forces, who have held interior lines during the present 
 war. Some of these railway lines owned by the State 
 have also been used for the purpose of pushing their 
 export trade, and their goods have been transmitted 
 over them to Hamburg and other ports, or down south 
 through Austria and Turkey, under a large discount in 
 rates. Nothing, in fact, has been left undone to further 
 the prospects of German commercial and industrial 
 dominance throughout the world. 
 
 Our way tp fight that, is not only to give, as we do, 
 a thoroughly good article, which can compete in price 
 with the German production, but, as has been previously 
 stated, to meet the requirements of the inhabitants 
 and purchasers of the various countries. In brassware 
 goods, for example, German competition was very strong 
 and very successful, their exports were over £6,500,000 
 stg. in value, as compared with ours, which were a little 
 over £1,500,000. In the case of machine tools, toys and 
 games, the German exports were in excess, by four to 
 one, of those from Great Britain ; Avhilst in kon and 
 steel plates, in glass, and in several other products they 
 had the largest share of the trade of neutral markets. 
 This was not formerly the case, and has only been so 
 since Germany adopted Protection. The Board of 
 Trade urged in their report that an important opening 
 
THE AUSTRIAN EMPIRE 255 
 
 is available for British development in connection with 
 iron and steel railway material. 
 
 A nation that treats trade as if it had no relation to 
 national security may for a time make great strides, 
 but a day of reckoning must come, and it has come to us. 
 As Mr. McKenna, then Chancellor of the Exchequer, 
 said in Parliament in 1915 : " We have seen a nation 
 which, in profound peace, planned, proposed, and 
 eventually provoked war. We have also found our- 
 selves dependent on that nation for many essential 
 matters of our trade." Let us hope that will not occur 
 again. 
 
 What shall we say of Austria and Turkey, and of the 
 latest acquisition to this curious combination — Bul- 
 garia ? What the three junior partners can have ex- 
 pected to gam by joining the German Confederation 
 in their midsummer madness it is difficult to say. 
 Were they willing or unwilling partners ? Does the 
 Prussian system and that of her feudatory States, in 
 regard to commercial and financial penetration, so 
 dominate them that they and their rulers had no op- 
 tion ? Or, on the other hand, were they simply drawn 
 into the fray by a few leading men in their respective 
 countries who had become thoroughly Prussianised ? 
 
 The population of Austria is composed of many 
 races, and numbers 29,000,000, or, including the 
 Kingdom of Hungary, about 51,000,000. Its area is 
 about 135,000 sq. miles. Germany, which is the senior 
 partner, has a population of 65,000,000 and an acreage 
 of 209,000 sq. miles. Whilst the German trade was 
 as large inwards and outwards as £869,000,000 in 1914, 
 which was a decrease from the previous year, that of 
 Austria was only £221,000,000 stg. in value. The 
 
256 THE CENTRAL EUROPEAN POWERS 
 
 Austrian Empire sent us £4^500,000 value of goods in 
 1914 ; of that £2,500,000 was the value of her sugar 
 export to the United Kingdom, whilst from our shores 
 we only sent products to the value of £2,500,000 stg. 
 in all, or to the same value as we received sugar from 
 them. Amongst other items we bought £377,000 worth 
 of eggs, and we appear to have got on during the last 
 two years fairly satisfactorily without these imports. 
 Of our exports to them, the largest items were coal 
 and iron. - 
 
 Our trade with Turkey in 1914 was to the amount of 
 £5,900,000 in value, and mainly consisted of cotton 
 yarns, woollens, coal, and machinery, whilst we imported 
 from that country wool, raisins, drugs, olive oil, to- 
 bacco, and figs, to the value of £4,200,000. It is to be 
 regretted that a nation for whom, in the last genera- 
 tion, we sacrificed so much should have turned against 
 us. Whether it is the fault of our diplomacy, or 
 whether Germany had means of inducing the Turkish 
 authorities to espouse their cause which we would not 
 deign to attempt, one cannot say. The Turk is reputed 
 to be a fair or " clean " fighter, though whether that 
 reputation is justified or not time will show. 
 
 There is a very small interchange of goods between 
 Bulgaria and the United Kingdom ; their exports in 
 the main consist chiefly of cereals, such as wheat. 
 
 One may take for granted that the most determined 
 adherent of our present free-import trade system will 
 admit that, as Nature placed coal and iron contiguous 
 in the United Kingdom, and the physical strength of our 
 countrymen is equal, if not superior, to that of the 
 German race, and as we are possessed of ample capital 
 and splendid machinery, nearly exclusively invented by 
 
BRITISH IRON TRADE AND GERMAN 257 
 
 the genius of the Anglo-Saxon race on this or the other 
 side of the Atlantic, we have the requirements of 
 industry and commerce in abundance. 
 
 Can it therefore be the " design of Nature," as the 
 adherents of our present trade system try to make out, 
 that in the year 1910 we imported from Germany hon 
 plates and sheets for the manufacture of ships, bridges, 
 and boilers to the weight of 35,100 tons, and in 1913 
 88,463 tons, whilst in the former year we only sent 
 them 2,734 tons of our similar products, and in the 
 latter that amount had decreased to only 339 tons ? 
 
 Taking another instance in the iron trade, one finds 
 that we purchased rails for trams from Germany in 
 the former year to the amount of 1,269 tons, and in 
 the latter that amount had increased nearly four-fold ; 
 we took from them 4,534 tons of that manufacture, 
 whilst to Grermany we sent similar products in those 
 two years to the small amount of 36 and 42 tons 
 respectively. Of rails for the use of our locomotives 
 on the permanent ways of this country we purchased 
 2,524 tons from the same country in the first year that 
 has been named, and in the latter 6,075 tons. We do 
 not appear to have exported any of that commodity 
 at all. The railways in Germany are in the hands of the 
 State, and no EngUsh rails are in consequence bought. 
 Again, in manufactured zinc we sent them no ex- 
 ports at all in either of the two years referred to, whilst 
 we purchased from them 6,643 tons in the former and 
 7,169 tons in the latter year. In all these instances it 
 will be seen that we were becoming more and more 
 dependent on them. It would be possible to enumerate 
 numbers of other instances of a similar character in the 
 manufactured-iron trade and m numerous other mdus- 
 
258 THE CENTRAL EUROPEAN POWERS 
 
 tries, but it is scarcely needful to do so, as the trend 
 of our inward and outward trade has been sufficiently 
 demonstrated. 
 
 It should be borne in mind that the metal and iron 
 trade was one in which, about the middle of last century, 
 we were pre-eminent and almost without rival. Rail- 
 ways also were invented by a great Englishman, and 
 the first two lines of railway in the world were laid be- 
 tween Liverpool and Manchester and near Darlington. 
 
 On election and other platforms one may hear the 
 bleatings of a certain class of orators about technical 
 education being the only panacea for our lost indus- 
 tries. We have already skilled engineers and com- 
 petent workmen for the making of iron rails and steam 
 boilers, and it is therefore idle to suggest that that 
 would be any remedy at all. It may be asked, to what 
 does one attribute the fact that our trade in manu- 
 factured iron abroad is diminishing, as well as in many 
 other directions, and also that we imported in 1913 a 
 considerable amount of iron and steel raUs, boiler plates, 
 manufactured zinc, and smaller articles of commerce, 
 such as, to quote a few only, gimlets, files, thimbles, 
 corkscroAvs, buttons, gilt wire, electrical machines, 
 cotton, curtains, lace, and all kinds of other products 
 large and small, to a great extent from Germany ? 
 The answer to this is that undoubtedly the main cause 
 is the heavy prohibitive import tariff on most of our 
 manufacturers sent to Germany, which renders it 
 almost impossible to continue exporting many of the 
 above-named products even with a minimum of profit. 
 
 In examining the most recent Blue book published by 
 the Board of Trade in 1913 on this subject, entitled 
 Foreign Import Duties, an exceedingly bulky volume of 
 
THE BRITISH WORKER'S DEMAND 259 
 
 nearly thirteen hundred pages — and, one may add, no 
 light task to study, as it has only an index, if one can 
 call it so, of two pages, and no apparent consecutive 
 order, alphabetical or otherwise, in regard to its con- 
 tents — one finds that on steam boilers exported from 
 the United Kingdom to Germany the import due charged 
 was in 1913 3^. per hundredweight ; on gimlets and 
 cutting files 145., on screws 6s., on thimbles, corkscrews, 
 nutcrackers, and buttons, 125. ; on gilt wire the high 
 import due of £3 145. lid. was imposed, on electrical 
 machines £1, on compasses and mathematical instru- 
 ments and typewriters £2 95. lid., all per hundred- 
 weight, so it would appear that even respectmg 
 scientific apparatus they did not rely solely on their 
 technical education in order to prevent our manu- 
 facturers competing with their own in then home 
 market. 
 
 Taking other duties charged on other manufactures, 
 it appears that lace of certain descriptions was taxed at 
 l5. 4d. per lb. on entering Germany. Most articles of 
 clothing were liable to import dues from l5. id. to I5. 6|(Z. 
 Turning to the machinery department, steam engines 
 or steam turbines, etc., had to pay by their general 
 tariff rules on entering Germany £1 175. per hundred- 
 weight, and so on ad infinitum. One need hardly add 
 that all these articles of commerce were, prior to this 
 war, allowed in the United Kingdom from the Central 
 European States duty-free. 
 
 Now the question might be asked, What policy is 
 suggested to amend this state of things and give equality 
 of competition to the British manufacturer and work- 
 man in regard to the products of their enterprise and 
 industry entering the Central European States ? — 
 
260 THE CENTRAL EUROPEAN POWERS 
 
 for it should be remarked that the Austrian tariff is by 
 no means a light one. 
 
 The foreign manufacturer and worker has this great 
 advantage over our people. He has a protected market 
 in his own country to pay for the upkeep of the works 
 and the cost of the plant — the latter in some instances 
 a very heavy charge indeed — and he can, of course, 
 in consequence, dump goods here to undersell our 
 makers, who have to pay all the charges of their manu- 
 facture out of their sales in the open market. Without 
 doubt this dumping system injures our home industries 
 in many cases, and does not give them either fair play 
 or equal competition. The remedy suggested, there- 
 fore, is the only logical and practical one, that we 
 should frame a general tariff, and say to the German 
 people : If you won't take our goods, but bar the door 
 to them, we will do the same with you, and if you see 
 fit to open your door to some extent, we will do the 
 same with you. We won't allow our industries to have 
 unequal competition with yours any longer. Further, 
 as has been previously suggested, after the war ends 
 we should not allow their shipping the same use of our 
 ports, harbours, and works on the same terms as our 
 Imperial mercantile marine, or those of our Allies, or 
 such friendly neutrals as we decide to make reciprocal 
 trading and shipping treaties with. We must, in fact, 
 base our commercial arrangements with the Empire 
 and the world in general not on sentimental lines 
 or in accordance with a Utopian policy of setting 
 a good example and chancing to luck or Providence 
 whether it is followed or not. 
 
 Of course in looking at this economic question from 
 the British standpoint, and also from that of the 
 
LORD MACAULAY ON PATRIOTISM 261 
 
 Empire and our Allies and friends, one lays oneself open 
 to be accused by certain stern political economists — 
 "Little Englanders" of the past, and Small Navyites 
 who love every country but their own — of not being 
 sufficiently cosmopolitan, of being narrow-minded, 
 and not regarding this question from the standpoint of 
 the sublime theory of the universal brotherhood of 
 mankind, which the last two years have done little to 
 prove a reality. Be that as it may, it would seem to 
 be to the ultimate benefit, not only of Great Britain 
 but also of the world at large, to look at this question 
 in a practical common-sense way. We must arouse 
 ourselves to the fact that many of the markets of the 
 world are being greatly restricted if not absolutely 
 closed against our trade and that of the British Empire 
 by hostile tariffs, and that unless we wake up we shall 
 only give to others the sinews of war for an early re- 
 newal of the present orgy of carnage and destruction. 
 
 We must also rouse ourselves from our economic 
 slumber and awake to the fact that the Hamburg- 
 America Line and North German Lloyd are preparing 
 for a trade campaign when the war terminates, and for 
 an extension of their commerce. In truth, in the 
 midst of war Germany is mobilismg for peace. She is 
 said to have formed a conclave of nine of the most dis- 
 tinguished business men of that Empire, who for the 
 last year have given their exclusive attention to the 
 working out of a plan for transferring Germany with 
 the least possible delay or disturbance from a war to a 
 peace basis. Is it wise to let the enemy count too 
 much on British presumed dislike to preparation and 
 looking ahead ? 
 
 One should approach this question as British 
 
262 THE CENTRAL EUROPEAN POWERS 
 
 subjects and in the same spirit as did the late Lord 
 Macaulay when in a speech on the sugar duties 
 delivered in the House of Commons he said : " A man 
 would not be justified in subjecting his wife and 
 children to disagreeable privations in order to save, 
 even from utter ruin, some foreigner whom he never 
 saw. If a man were so absurd and perverse as to 
 starve his own family in order to relieve strangers 
 with whom he had no acquaintance, there can be little 
 doubt that this crazy charity would produce much 
 more misery than happiness. It is the same with 
 nations. No statesman ought to injure other countries 
 in order to benefit his own country. No statesman 
 ought to lose any fair opportunity of rendering to 
 foreign nations such good offices as he can render 
 without a breach of the duty which he owes to the 
 society of which he is a member. But, after all, 
 our country is our country, and has the first claim on 
 our attention. There is nothing, I conceive, of narrow- 
 mindedness in this patriotism." 
 
CHAPTER VIII 
 
 THE HOUR OF GREAT OPPORTUNITY 
 
 *' There is a tide in the affairs of men 
 Which taken at the flood, leads on to fortune, 
 Omitted, all the voyage of their life 
 Is bound in shallows, and in miseries. 
 On such a full sea are we now afloat, 
 And we must take the current while it serves 
 Or lose our ventures." 
 
 Shakespeabe, Julius Ccesar, Act 4, Sc. Ill, 
 
 The opportunity which will arise when this great war 
 
 terminates is one which may never occur again. The 
 
 Empire is more thoroughly united in sentiment than 
 
 it has ever been before in history. The great peril we 
 
 have all gone through, and the common danger we 
 
 have faced resolutely and bravely— and which will 
 
 before long, we all hope, have been surmounted— 
 
 has brought us together as Britannia's sons and 
 
 daughters have never been brought together before. In 
 
 the field of battle, the hospital, factory, ship, workshop, 
 
 farm, and elsewhere, all classes have commingled 
 
 together, helping one another as best they could for their 
 
 common good. The rough edges of social differences, if 
 
 not actually removed, have been smoothed over, let us 
 
 hope for long years after this war has become a thing of 
 
 the past. 
 
 19 263 
 
264 THE HOUR OF GREAT OPPORTUNITY 
 
 We have learnt as an Empire, as a nation, and as a 
 community, to understand one another better, and to 
 realise that with but a few exceptions our common 
 aspirations and our common hopes are to safeguard our 
 Empire, our liberty, and our flag, and to protect 
 civilisation from the wanton ambition of ruthless 
 tyrants and military adventurers. 
 
 Time, however, is of the essence of the problem 
 before us, and if we are to do anything really satisfactory 
 we must set about preparing to do it now, and, putting 
 aside all considerations of doctrine or party, devise a 
 policy to develop our immense resources — one by which 
 we can improve the conditions of our national, social, 
 and economic life. 
 
 To us has been assigned the responsibility of guard- 
 ing the destinies of one-fourth of the human race. In 
 carrying out that great trust we shall ever keep the 
 ideals of liberty, order, and justice before our eyes as 
 the lode-star of our policy. Our aim must further be 
 to add to the material and social welfare of the people in 
 the Dominions and Dependencies comprised in the 
 Pax Britannica, not continuing to pursue in that direc- 
 tion a policy of negation and drift, but putting into 
 execution a definite, well-thought-out plan suitable to 
 the present conditions of the world in the twentieth 
 century. 
 
 The first absolutely essential thing which we must 
 set about is to put our inter-Imperial trade relations, 
 and our commercial interchange, on a satisfactory 
 basis, at the same time leaving each Dominion its power 
 of self-government and fiscal autonomy untouched. 
 This can only be done by an inter-Imperial preferential 
 system of tariffs, which will entail the Mother Country 
 
GREAT QUESTIONS TO BE SOLVED 265 
 
 establishing a general Customs Tariff within the 
 United Kingdom. 
 
 The question which will also have to be approached 
 by the ]next Dominion Conference is the Constitutional 
 position of the Empire, and the best mode of devising 
 an authority which will have the power to deal either 
 directly or indirectly, in a representative capacity, with 
 matters affectmg the Empire as a whole. 
 
 There are other questions of the greatest importance 
 which it is proposed to refer to after first touching 
 briefly on some of the chief aspects of the problems 
 which these two matters of moment to the Empire 
 involve. 
 
 Regarding the co-operation on a preferential basis 
 within the limits of the Empire of its commercial rela- 
 tions and its industries, given the will to do so, which 
 certainly exists in the Dommions beyond the seas, 
 the vast majority of the people of the United Kingdom 
 will doubtless accept this policy. There are, no doubt, 
 difficulties, but these difficulties could easily be met and 
 surmounted if a conciliatory give-and-take attitude 
 were adopted. 
 
 Our plans must be ready and the interests of the 
 manufacturing, mining, shipping, and other industrial 
 classes and mterests safeguarded. The question of a 
 tariff in the United Kingdom should be approached at 
 once and a Royal Commission appointed to take all 
 steps needful to give fair consideration to all the in- 
 terests involved, and to make a report which should 
 be acted on without needless delay in order that a 
 scientific general import tariiS in the British Isles may 
 become law. 
 
 From our general tariff, when fixed, preferences cculd 
 
266 THE HOUR OF GREAT OPPORTUNITY 
 
 be given within the Empire, to the Allies, or to friendly 
 neutral Powers, as far as possible on the principle of 
 reciprocity. 
 
 The virtue of any proposed action of this description 
 is to do it in time. Have we not had warnings enough 
 in the last two years about the evil of procrastination ? 
 We ought, therefore, without needless delay to thrash 
 out and decide upon a policy to meet the altered condi- 
 tions we shall have to face when this war ends. 
 
 Our enemies in Germany have not been exporting 
 goods during hostilities, except to some extent to 
 Holland, Sweden, Denmark, Switzerland, and the 
 Near East, and it is reported that they have been 
 avowedly accumulating them to the large amount of 
 £300,000,000 worth in value in readiness for the Great 
 Trade War which they propose to commence on the 
 declaration of peace ; relying, we hope wrongly, on 
 political and other influences bemg brought to bear in 
 certain quarters to prevent the Entente Powers from 
 preparing to meet this attack. 
 
 The free-unport trade policy hitherto adopted as a 
 
 sort of religion by this country since 1850 — as the 
 
 law of the Medes and Persians which changeth not — 
 
 renders us very vulnerable to such a form of attack. 
 
 The Empke of India, whose fiscal policy is more or 
 
 less under the aegis of the British Government, is 
 
 nevertheless obliged to remain in the same position of 
 
 fiscal helplessness, and is practically deprived of powers 
 
 of retaliation against " dumpmg," or other trade 
 
 devices of a similar kind. The self-governing Colonies 
 
 are in a better position, and have the full power of 
 
 retaliation, if they so desire, should their industries be 
 
 attacked, and, unless one is greatly mistaken, would 
 
CANADA RESENTS GERMAN WAYS 267 
 
 not hesitate to act promptly and with decision if occa- 
 sion so required. 
 
 Our gallant French, Russian, Italian, Japanese, and 
 other Allies are not likely to stand any more nonsense 
 of that sort, but they are not hide-bound by any 
 economic shibboleths of the eighteenth and early nine- 
 teenth centuries. Their hands are free, and not tied 
 behind their backs as ours at present are. 
 
 The people of this country will have sometliing to 
 say in this matter, and wUl, if our administrators show 
 hesitation and procrastination in dealing with this 
 difficulty, demand to know whether an economic 
 system exists for the good of England or England 
 exists to prove the correctness of the views of certain 
 political economists. 
 
 During the autumn of 1916, the following instance 
 regarding the power which retaliation, if needful, gives 
 a country whose industry is attacked was brought to 
 the notice of the writer by an influential Canadian 
 friend whose views on economic questions coincide 
 with his own. 
 
 Canada, a few years ago, decided to give the United 
 Kingdom certain preferential treatment on certain 
 British exports to that Dominion. Germany, having 
 at that time a treaty in existence with Great Britain 
 containing what is called the " most favoured nation 
 clause," promptly took umbrage at Canada's action, 
 and made representation to the British authorities 
 that this preference given by Canada infringed the 
 aforesaid treaty. The British President of the Board 
 of Trade replied that Canada had fiscal autonomy, 
 and that he had transferred to that Dominion full 
 power in the matter. This, of course, the German 
 
268 THE HOUR OF GREAT OPPORTUNITY 
 
 authorities were fully aware of. The German Govern- 
 ment then heavily increased the import duties on 
 Canadian corn and other articles of commerce to their 
 country in order to punish Canada for daring to grant 
 preferential trade to theii' Mother Country. The 
 Ministers of Ottawa replied to this action very promptly 
 by at once doubling the duties on all the chief articles 
 of commerce which Germany sent to their shores, 
 fortunately possessing the power to do so at once under 
 theii' tariff law simply by an Order in Council, and 
 without any need of reference to their Legislature. 
 
 The German Consul-General then sought an interview 
 with the Canadian Minister of Commerce of that day, 
 !Mr. Patterson, who, being a man of determination, 
 told him plainly that they would not remit the duties 
 unless the Germans took off theiis. During the con- 
 versation ]\Ir. Patterson is reported to have said : " You 
 are not dealing with a British Government," and also, 
 in answer to the question put by the German Consul- 
 General : " What am I to report, then, to my Master ? " 
 " ITl tell you," replied the Canadian, and, sending for a 
 stenographer, he had the following typewritten • 
 " You tell your Kaiser that he gave us the medicine 
 first, and now we're giving it him, and if he does not 
 like it he's not to squeal ! " This he handed to the 
 astonished German Consul. 
 
 For two years the Germans and Canadians both 
 maintained these increased duties, till the former found 
 out that they were, so to speak, " cutting off their 
 nose to spite their face," as their exports to Canada, 
 consisting mainly of manufactures, were three times 
 greater in value than the Canadian exports to Germany. 
 Finally they cancelled the increased duty objected to, 
 
OUR HELPLESS TARIFF SYSTEM 269 
 
 and the Canadians did the same, Mr. Patterson inform- 
 ing them at that time that their exports would be placed 
 on the Canadian General Tariff without any preference 
 whatsoever. The Canadian friend previously referred 
 to did not ask what would have happened if, prior to 
 the war, for any reason, the Germans had decided to 
 double their duty on British goods. 
 
 From one's experience in Parliament it seems clear 
 that something like this would probably have occurred. 
 Some Member of Parliament, whose constituency was 
 hit by this increased tax — a few thousand British work- 
 ing men being unfortunately thereby thrown out of 
 employment and, maybe, a few local manufacturers 
 also ruined — would have asked a question in the House 
 of Commons as to whether this was " most favoured 
 nation " treatment, and would have received an official 
 reply which would have amounted to nothing. In a 
 month or so later, during a discussion on Board of 
 Trade estimates, this member would have made a 
 strong speech of protest, and the JVIinister in charge of 
 the Department would probably have replied in a 
 conciliatory manner, expressing his deep sympathy 
 with his honourable friend and his constituents, and 
 informing him that representation had been made on 
 the subject by the British Ambassador, but, he re- 
 gretted to say, without avail. He would not have 
 added in so many words, though he would have inferred 
 it, that nothing of real avail could be done as we had no 
 power of retaliation, and, of course, the sacred doctrine 
 of so-called " Free Trade " would not be in any way 
 infrmged by us. The Minister might even have offered 
 him a Committee to consider the matter, though, need- 
 less to say, the facts were patent and only too clear. 
 
270 THE HOUR OF GREAT OPPORTUNITY 
 
 A committee, or the offer of a committee, is a never- 
 failing source of consolation which is proffered by 
 a Minister when he is nearly certain he can do nothing, 
 or does not wish to move in the matter. 
 
 It must not be inferred from this that committees 
 are not often appointed really to carry out definite 
 and useful work, or that Ministers of the Crown in the 
 United Kingdom are not, many of them, men as firm 
 and determined as those holding similar offices in the 
 Dominions, for they are ; but whatever thek private 
 views may be, in favour of unrestricted free-import 
 trade or against it, the system they have to administer 
 has for years past rendered them powerless of retalia- 
 tion, and they know it ; the Foreign Governments 
 they have to deal with are equally aware that is the 
 case, and so thej fail to give us satisfaction in those 
 matters. 
 
 The fact is that the people who invented what they 
 wrongly described as " free trade " presupposed that 
 the world would, after its inauguration, be always at 
 peace, and that all the nations would wish to follow 
 " our good example " and establish unrestricted and 
 open interchange in thek markets with the commerce 
 of the world. The foreigner took what he conceived 
 to be the good part of the bargain, namely, the free 
 market opened to him in the United Kingdom, and, 
 after a few years' dalliance with slightly lower tariffs, put 
 his up higher agam, and only kept his tariff fairly low- 
 on such goods as we do not import ^^-ithin his borders, 
 whilst in most cases he placed preventive tariffs on 
 those commodities which we were exporting to his 
 markets, and did his utmost to restrict our trade. 
 This system of " heads I win, tails you lose " was 
 
WHY SHOULD WE TAX TEA? 271 
 
 called giving us " the most favoured nation treatment," 
 and one of the first things we should do would be to 
 give notice to put an end to all the commercial treaties 
 now existing with that clause in it, which we can do, 
 with a notice of either a year or six months in all cases 
 except one. The latter treaty can surely be modified 
 in our interests by 'our Japanese Allies on reciprocal 
 advantages being conceded them. 
 
 The former President of the Board of Trade, I\Ir. 
 Runciman, indicated in the House of Commons his 
 opinion of those treaties last year as follows : In some 
 instances, he said, the foreigner is giving us what is 
 ironically called " the most favoured nation treat- 
 ment " in commercial treaties, and in his tariffs he 
 " put a very low tariff on things which did not matter 
 and a very high one on some things which did matter 
 to us." 
 
 It has been erroneously stated that the consumer in 
 the importing nation has to pay all the tax charged on 
 goods at the Custom House. That view is only correct 
 in regard to products or commodities which the country 
 to which they are sent cannot make or produce, and 
 does not appl}^ to those which can be home-grown or 
 manufactured by the importing nation . Probably being 
 aware of that, our so-called "Free Trade" Ministers 
 and legislators put a heavy tax on wine, on tea, on 
 coffee, on tobacco, and on cane sugar, which, as they 
 were aware, we camiot produce in these Islands. 
 
 Before the war, the cry was specially raised by 
 women in England — " oh, so mebHj things that we 
 require — glass, china, decorative furniture, what are 
 called ' faacy goods,' jewellerj^ bronze, articles of 
 dress — are only made abroad, and if you put a duty on 
 
272 THE HOUR OF GREAT OPPORTUNITY 
 
 them we shall have to pay more for them." They 
 never stopped to inquire, nor did the political econo- 
 mists, why that was more or less true, nor to learn that 
 we had to import them in large quantities, if not en- 
 tirely, because the foreigner — say the German or 
 Austrian manufacturer — had a protected market in 
 his own country — in the case of Germany of 70,000,000 
 people and in Austria-Hungary of 50,000,000 — and he 
 could afford to dump his surplus stock in England at 
 a loss for a time, in order to kill any attempt on our 
 manufacturers' part to compete with him, and then 
 sell the goods here at any price he saw fit after he had 
 established a monopoly as a result of their manufac- 
 ture in this country being stopped. 
 
 If we had a moderate duty charged at our Customs 
 on nearly all those goods, they would be made in 
 England, Scotland, or Ireland just as cheaply, and 
 probably with better finish. Now, why would that 
 be the case, and why would the cost of the foreigner's 
 duty when paid not be added to their price, as 
 alleged ? For several reasons : fii'stly competition 
 amongst our manufacturers and traders would keep 
 the price down ; secondty the goods, instead of being 
 made here, as they are under our present economic 
 system, only in small quantities, would be made by 
 tens of thousands. 
 
 One superintendent in a mill or factory can see work 
 done on a large scale as well as on a small one ; that 
 is a saving in cost. The same staff of engineers can 
 drive a big engine capable of doing ten times the work 
 of a small one. Thirdly, where moulds of an expensive 
 character or special machinery are required to make 
 a special class of goods, the share of this first cost is 
 
THEORETICAL PROFESSORS 273 
 
 less per single article if goods are made by the hundred 
 thousand instead of the single thousand. 
 
 Besides that, it has also to be borne in mind that 
 when the shop-keeper sells an article of general use and 
 manufacture in this country he has to content himself 
 with a smaller profit. The railways also transmit 
 goods in bulk at a lower rate than they do small quanti- 
 ties. That has been found to be the case m actual 
 practice. 
 
 To state the matter thus in simple words, shocks of 
 course those theoretical professors of political economy 
 who hold different opinions, and who in their treatises, 
 set forth in words of portentous length and complex 
 sentences of great apparent learning what thej'^ are 
 pleased to call " the fundamentals " of their dogmas 
 and doctrines. They never condescend to study the 
 subjects they profess to teach either in the factory, 
 the workshop, the warehouse, or the field, but in the 
 seclusion of the University cloister or the study. 
 Their works, or extracts from them, are printed in 
 pamphlets and showered on the electors when a par- 
 liamentary contest is taking place, or repeated with 
 weary reiteration from platforms at election times by 
 politicians who have never studied the question. 
 
 No inconsiderable number of the voters to whom 
 these dogmas are thus presented have neither the 
 time nor the opportunity to test their accuracy, and 
 so the various fallacies which these politicians enunciate 
 get spread about like noxious weeds. Another remark- 
 able thing about Free Trade writers or speakers is that 
 they are largely of foreign extraction, and devote their 
 energies not to converting their own fellow-country- 
 men, and making them see the advantages of their 
 
274 THE HOUR OF GREAT OPPORTUNITY 
 
 one-sided doctrine, but to saying to our people words 
 to this effect : " The more you buy abroad and the less 
 you produce or make at home the better for you and 
 the worse for the foreign worker, and if you don't see 
 that you must be a fool." 
 
 There is no intention to attempt in these pages to 
 frame a tariff suitable for all the exigencies of our 
 Imperial destiny, our honourable obligations to our 
 Allies, and, last but not least, the promotion of the 
 direct interests of the inhabitants of the United 
 Kingdom. That could only be done by the combined 
 labour and practical knowledge and experience of a 
 strong commission or committee of experts, and no 
 doubt a good deal of time would be taken in framing 
 such a tariff for the consideration of Parliament. 
 
 One is inclined to think that high duties should be 
 put on what are known as luxuries, such as, for instance, 
 jewellery, lace, expensive clothing, motor cars, wines, 
 and tobaccos ; a moderate duty on articles of general 
 use, which can be manufactured or produced here ; and 
 a light one on certain products which cannot be grown 
 in the United Kingdom, such as tea and sugar, and 
 also on certain alimentary products (though not on 
 all), which, with the majority of articles of raw produce 
 and only slightly manufactured goods, should be 
 either very lightly taxed or placed on the free list. 
 
 Every unit of the Empire should be absolutely free 
 to make its own fiscal arrangements as it sees fit, and 
 as best suits the circumstances of the people in its own 
 area. 
 
 A man may be completely free to go his own way and 
 yet, at the same time, find it to his own interest as well 
 as for the benefit of his neighbour to work with the 
 
F.CONOMIC PRUDERY 275 
 
 latter. We must, in fact, row in the same boat with 
 the mighty dominions of the Crown, and " keep in 
 time " with them and pull the same stroke if we all 
 want to succeed in this wide-world competition. 
 
 Every unit in the Empire could without difficulty 
 arrange its own fiscal policy to suit its own conditions, 
 while, at the same time, giving favourable treatment to 
 every other unit of the Empire over and above the man 
 or nation not within the family. 
 
 Each unit of the family group makes his own arrange- 
 ments. Canada says, " We must have a tariff, but will 
 admit within our boundaries goods from Britain." 
 Similarly the United Kingdom, Australia, New Zea- 
 land, South Africa, the West Indies, and other parts of 
 the Empire charge at their customs a lower rate of 
 duty than the general tariff they have framed for their 
 own purposes. By such means the autonomous 
 principle is safeguarded, and yet the benefit of favour- 
 able treatment accrues to all the members of the 
 family. Why a nation should be called upon, as we 
 undoubtedly are, to keep fleets and armies to protect 
 its people and its boundaries, and yet, in obedience to 
 some law of self-imposed economic prudery, think it 
 wrong to have a tariff to protect its industrial and 
 commercial interests, it is difficult to see. 
 
 Every one of our Allies, including Japan, has a 
 carefully framed general tariff. All the self-governing 
 British Colonies have adopted Protection, and yet, in 
 the opinion of some people, the views held in favour 
 of protection by every other civilised race, and now, 
 it would seem evident, by more than half the people of 
 these Isles, are very much to be deprecated. During 
 the summer of 1916 a determined apostle of Free Trade, 
 
276 THE HOUB OF GREAT OPPORTUNITY 
 
 a fair-minded man holding broader views than most 
 of those who have adopted those doctrines, wrote a 
 thesis on the trade question in which he acknowledged 
 that we should have " to protect essential industries." 
 He shortly afterwards wrote a letter to one of the 
 leading London journals stating that he still remained 
 a Free Trader. The Editor, in a short leading article, 
 sought to reassure him in the following sarcastic and 
 humorous manner : " We hasten to inform the writer 
 that, whatever he says or does, no one will ever think 
 him a Protectionist. There are some favoured people 
 who always escape calumny, and he is one. A real 
 Protectionist is a bad man who takes a low view of 
 human nature, and believes there will always be a great 
 deal of jealousy amongst nations, developing occasion- 
 ally into downright fighting. Therefore he thinks that 
 whilst wealth is good, strength is better, and whilst 
 you may be doing better in the tradesman's sense by 
 letting ' doubtful friends ' make essential things for 
 you, you will assuredly be awkwardly placed in case 
 of war with the same doubtful friends." This war 
 has proved the truth of these words, as we know to our 
 cost. 
 
 Many, however, of the most far-seeing men amongst 
 us, who have hitherto been stout adherents of our 
 present free-import trade system, have now thrown 
 their previous views to the winds, as they consider that 
 no theoretical adherence to any group of economic 
 doctrines should prevent our adapting our fiscal 
 system in such a way as to meet the circumstances we 
 have to face. It is satisfactory to see that many of 
 our statesmen have clearly shown that in view of the 
 grave times through which we are passing, and the 
 
UNFAIR FOREIGX COMPETITIOX 277 
 
 difficult period which lies ahead of us when this war 
 terminates, they prefer patriotism to any previous 
 prejudices ; and if the necessity for a tariff is reason- 
 ably advanced and insisted on with courageous pertin- 
 acity, they, in then* desu^e and eagerness to look at 
 everything from a common-sense and practical stand- 
 point, will recognise that circumstances alter cases, and 
 that a general tariff is not a thing they can refuse, but 
 rather one which, in the interests of the country and the 
 Empire, they must accept as a beneficial proposal* 
 
 It is important also to note that a non-political 
 society of leading manufacturers in the United King- 
 dom, with the title of the British Manufacturers Asso- 
 ciation, has recently been formed with the object of 
 protecting British trade from unfair competition ; 
 whilst at the Conference of the delegates of Labour 
 held last autumn, in a resolution carried by a large 
 majority, the following sentence appeared in the report 
 of the proceedings published by the Press : " Methods 
 should be adopted which will restrict the importation 
 of cheap foreign goods which have been produced at 
 lower rates of wages, or under worse labour conditions, 
 than those prevailing in this country." 
 
 This evidently shows that labour in England has 
 broken loose from the bonds of its Cobdenite tutelage, 
 and is fully aware that satisfactory conditions of em- 
 ployment cannot be maintained after the war, or a 
 living wage paid to the workers, whilst we give, as we 
 do, the Germans and all other nations a free and open 
 market within our borders for ordinary trading, only 
 to find that in certain directions our generosity is re- 
 paid by all manner of underhand devices for cutting 
 into and undermining our industries with sweated or 
 
278 THE HOUR OF GREAT OPPORTUNITY 
 
 prison-made goods, or by means of subsidised dumping 
 — the most pernicious form of commercial " black- 
 legging." It would seem from this that the working- 
 man has awakened to the fact that if we allow German 
 " blackleg " goods to displace the manufactures of our 
 own people, and the shops in this country to be crowded 
 by bounty-fed foreign-made articles (subsidised in 
 some instances by their own Government in hard cash, 
 and aided also by ours in not having to pay an iota 
 towards the heavy general and local expenditure of 
 this country which has to be borne by the British 
 manufacturer of similar products), British labour will 
 have to look in vain for employment, whilst emigration 
 or starvation will be the only alternatives before it. 
 
 Even the tram-lines in our streets are laid with 
 bounty-fed German rails, and paid for out of public 
 funds provided by the British ratepayers, though at 
 the time when they were purchased by the order of 
 one of our local elected bodies probably hundreds of 
 our steel workers were seeking employment and were 
 unable to find it. 
 
 In regard to developmg the great resources of the 
 Empire, the Rt. Hon. Sir George Foster, K.C.M.G., 
 Minister of Commerce of Canada, has said ; 
 
 " The next thing is to improve all these by develop- 
 ment. Development works through production, and 
 trade and commerce come in to distribute the result 
 of production. I thmk that in this way we get trade 
 into its proper perspective. Trade is a means to an end 
 rather than an end in itself. Trade looked at in one 
 way is heartless, selfish, and inconsiderate of national 
 claims. The trader does not care as to the origin 
 of his goods, but the nation is immensely interested 
 
ZEAL OF NEW CONVERTS 279 
 
 in the origin of goods that are traded in. The trader 
 does not care primarily about quality, but the nation is 
 immensely interested in the quality of the goods that 
 are traded in. The trader cares nothing as to the 
 purpose to which his wares are put, but it is of immense 
 interest to the nation to what purpose the wares are 
 put. The trader, as such, cares nothing for loyalty 
 to the nation." 
 
 We must not blind our eyes to the fact that there is 
 a group of stiffly obstmate theorists, endued with 
 firmly set prejudices, who still maintain that Free Trade 
 principles are indeflectable, and that to remove that 
 Ark of the Covenant would be a grave disaster ; but 
 this cannot be said to be the main current of opinion 
 of any of the great parties in the State, and in some 
 cases the transition from the Cobdenite position has 
 been so rapid that, like all new converts, they are 
 even keener reformers than those who have steadily 
 held for years past that a change in our fiscal policy 
 was absolutely essential to the national welfare. 
 
 Their change of opinion has not, in all cases, been 
 caused solely by the startling revelations in regard to 
 our grave dependence on Grerman manufactures, even 
 for munitions of war, w^hich were made when this war 
 commenced, but also by the trend of the development 
 of trade in the last thirty years. The facts were too 
 strong for them to resist the impression that something 
 in our economic system must be wTong, as whilst in 
 German}^ during those three decades the agricultural 
 workers increased by nearly two millions, ours decreased 
 by a quarter of a million. Her workers, also, in iion, 
 steel, and engmeering increased by one million five 
 hundred thousand — ours by only one-third that number; 
 20 
 
280 THE HOUR OF GREAT OPPORTUNITY 
 
 and further Germany increased her production of iron 
 from three milHon tons a year to nearly twenty million, 
 while we increased ours from only eight to nine million 
 tons. 
 
 On the eve of war, Germany's manufacture of steel 
 was more than twice that of our own, and, aided by 
 her bounties, her increase of exports of iron and steel 
 in that period was from about one million tons a year 
 to six times that amount a year, whilst our increase 
 was only from three million five hundred thousand tons 
 to five million tons a year. The greater part of this 
 increase was made at our expense in consequence of 
 our wrongly described Free Trade system, and was 
 chiefly the means by which she accumulated funds for 
 her scheme of world-conquest and the economic defeat 
 of all competitors. 
 
 What right have we, alone amongst our brethren 
 beyond the seas, and amongst our brave and gallant 
 Allies who have fought and died for the same cause as 
 ourselves in defence of civilisation and liberty against 
 a common foe, to allow our enemies to recuperate 
 rapidly after this war is ended, as a result of our foolish 
 fiscal system, and to make immense profits out of our 
 insular free-import trade doctrines. Are we, again, 
 certain that we shall for all time hold the predominance 
 on the seas as at present, and be able, as in 1915, to 
 import food, drink, and tobacco to the value of 
 £381,000,000 and £181,500,000 of manufactured articles 
 to these shores ? 
 
 We must, in truth, as a nation, deal with this question 
 of our trade relations as practically and in as clear- 
 headed a manner as the best business man either here 
 or in any other country would deal with his business 
 
THIS IS THE TIME FOR ACTION 281 
 
 affairs, discarding all pedantic dogmas and the subtle- 
 ties so dear to certain professors. 
 
 We have had, from time to time, speeches in Parlia- 
 ment and in the country from Ministers in sympathy 
 with reform in our commercial system, though the 
 direction of that reform has only been generally indi- 
 cated. What we really requu'e is not so much sym- 
 pathy as action — action which will place the industries 
 of this country in a secure position, no longer at the 
 mercy of some autocrat or foreign Government to 
 attack with success. We do not require a mere passing 
 ray of economic prosperity, soon to pass away and 
 disappear, and be succeeded by the darkness of depres- 
 sion, unemployment; reduced wages and food, and a 
 fierce struggle for livelihood amongst our workers. 
 We must remember that whilst we have on our side 
 the latent advantages of abundance of raw material 
 within the Empire, the various climates suitable for 
 the growth of every known vegetable product, and 
 tens of millions of willing workers for the production 
 of manufactures of all kinds, we have a skilful and 
 determined economic enemy in Germany misled by 
 Prussian influence, who will spare no effort that 
 science, organisation, skill, energy — and, we must 
 add, cunning — will give to undermine our trade and 
 defeat us, and who will stick at nothing to accomplish 
 her end. We must profit by the opportunity that now 
 arises of consolidating the resources of the Empire and 
 of the Allies to the mutual advantage of all. We have 
 the ball at our feet now, if we take it in the right way. 
 
 Without any legislative action on the part of our 
 rulers, the virtual protection we have enjoyed during 
 the war has allowed the British manufacturer to make, 
 
282 THE HOUR OF GREAT OPPORTUNITY 
 
 amongst other articles, magnetos, hitherto sent from 
 Germany. Some of our manufacturers are, as a result 
 of this, doing well at the present time, and both our 
 home and our export trade is showing signs of recupera- 
 tion. If this war-tmie protection is withdrawn at the 
 termination of hostilities, that key industry and 
 many others would revert to Germany, as she would 
 dump those scientific instruments and other goods 
 upon us, under cost price, in order to kill our manu- 
 facture of them. If she succeeded in this, up at once 
 would go the price of the goods she had sent here. 
 The prices here would be put up as they deemed fit, 
 and we should be in the same helpless position in regard 
 to many of our manufactures, and as dependent on 
 Germany for many of the products we were without in 
 August 1914, as when this great war commenced. 
 
 It would seem as if the laissez faire followers of the 
 present one-sided fiscal system can never have read 
 the works of Adam Smith, the founder of the doctrme 
 of " freedom of trade " which they profess to believe 
 in, or, if they have done so, they have failed to under- 
 stand them, for they recklessly ignored the adequate 
 means of providing against the avowed and patent 
 attacks which our manufacturing and industrial enter- 
 prises have been subjected to during the last few 
 decades. In his work, The Wealth of Nations, one 
 finds this passage : 
 
 " The second case in which it will generally be ad- 
 vantageous to lay some burden upon foreign imports 
 for the encouragement of domestic industry, is when 
 some tax is imposed at home upon the produce of the 
 latter. In this case, it seems reasonable that an equal 
 tax should be imposed upon the produce of the former. 
 
INDUSTRIAL DEFENCE 283 
 
 This would not give the monopoly of the home market 
 to domestic industry nor turn towards a particular 
 employment a greater share of the stock and labour 
 of the country than what would naturally go to it." 
 
 This quotation admits an exceedingly important part 
 of the case maintained by those who advocate a freer 
 and fairer trade system in their country, and is an 
 absolutely unanswerable statement. In no part of 
 Adam Smith's arguments does he repudiate retaliation 
 by means of tariffs to safeguard the interests of our own 
 industries ; and, as will be seen from a careful perusal 
 of the above extract, he seems to have been conscious 
 that at some stage of the world's history industrial 
 defence might be not only desirable, but imperative. 
 
 That a system of free imports creates vast wealth for 
 a few middlemen no one disputes ; that it tends to 
 either national security or to a reasonable competence 
 and stability of well-paid employment for the many, no 
 honourable and sensible man can maintain or allege. 
 
 As has been already pointed out, the trade unionists 
 of this country, at their conference last autumn, clearty 
 indicated that the national welfare, the national inde- 
 pendence, and the continuous employment of the 
 industrious in the country at good wages are of more 
 importance and are more essential to the general good 
 than the manufacture of a few millionaires on the 
 unfair profits made on foreign dumped goods, and the 
 consequent ruin of scores of British industries employ- 
 ing labour. 
 
 Warnings that our economic system was out of touch 
 with the times, with the requirements of the United 
 Kingdom and of the Empire, have been uttered by many 
 
284 THE HOUR OF GREAT OPPORTUNITY 
 
 far-seeing men, several of whom, in order to state their 
 views, openly and fearlessly have sacrificed high olBfice 
 in the State, health, leisure, and finally, like the late 
 distinguished statesman, Mr. Joseph Chamberlain, 
 life itself, although they have been scoffed at and 
 totally misrepresented by some narrow-minded and 
 selfish politicians. 
 
 Their warnings have all come true, only too true. 
 Our position of economic dependence on Germany 
 when the war broke out in 1914 was pitiable, and it is 
 -monstrous that the once greatest industrial nation in 
 the world should have been placed in such a position 
 bv the dictates of a few Cobdenite fanatics. It was 
 certainly the Navy — and was it also good luck ? — that 
 saved us. We turned a deaf ear to the warnings of 
 the late Lord Roberts respecting our military forces, 
 beguiled by the oily words of a forensic War IVIinister 
 then in office. Of course, the fact may be alleged, and 
 justly, that the very fact of our being so unprepared 
 for a prolonged war shows both our belief in and our 
 wish for peace. Whatever excuse we might have had, 
 however, for unpreparedness for war, we should have 
 none now if we were found to be unprepared for peace. 
 
 There is a widespread belief amongst many in a posi- 
 tion to judge respecting commercial and industrial 
 matters, that whilst probably, at first, there will be a 
 great demand on all hands for labour to repair the 
 fearful destruction and wastage this war has caused, 
 it will not be long after hostilities close before a trade 
 contest of great intensity ensues, the severest by many 
 degrees that this countrj^ has ever taken part in. 
 This contest will be waged not only with the Central 
 European Combine, but also with another great pro- 
 
ORGANISATION 285 
 
 tectionist country, America, who will have enormously 
 increased resources to bring into competition with ours, 
 which by then will be greatly depleted, though Ger- 
 many's breach of international maritime law in sinking 
 by submarines our merchant ships has only reduced, 
 up to now, our merchantile marine to a very small 
 extent. 
 
 A strange anomaly strikes one in this connection. 
 If an expert in such matters were to go to any of our 
 great centres of industry, and, by permission of the 
 owners, be given an insight into the working of any of 
 the large concerns, he would report that the organisa- 
 tion of each of these concerns is as thorough and 
 efficient as any to be found in the world ; and whilst 
 this is, no doubt, the case, yet the general organisa- 
 tion of our industries as a nation leaves, from all 
 accounts, a great deal to be desired. Germany was in 
 1914 the best-organised nation in that respect, more 
 especially as regards co-ordination of working, general 
 scientific, and technical training. Before the war 
 she was the only nation that laid itself out for a sys- 
 tem of thorough industrial and economic organisation 
 and co-ordination, and it is sad to reflect that pre- 
 paredness, good in itself, was very largely perverted 
 for the dreadful purpose of world-conquest and human 
 destruction. 
 
 In our own defence we had to organise to manu- 
 facture munitions of war, but before Mr. Lloyd George 
 took that vital matter in hand for us with thoroughness 
 we were, indeed, in a parlous condition. Since that 
 effective organisation was carried out a different aspect 
 of affairs has presented itself. 
 
 By the Imperial preferential system of trade herein 
 
286 THE HOUR OF GREAT OPPORTUNITY 
 
 advocated, we should be able to organise the resources 
 of the widespread Dominions of the Crown in a 
 thoroughly effective manner, both for times of peace 
 and also, should the Empire's sons again be summoned 
 to rally beneath and uphold the flag, during the dread 
 arbitrament of war. 
 
 We should, then, as far as material resources are 
 concerned, be ready for any event. It is our duty to 
 be prepared, as the Chancellor of the Exchequer said 
 in a speech delivered to the Associated Chambers of 
 Commerce in 1915 :• " We have seen a nation which in 
 profound peace planned, prepared, and eventually 
 provoked war, we have also found ourselves dependent 
 on that nation for many essential matters of our own 
 trade." 
 
 That should never be the case again, more especially 
 when one finds that the then President of the Board 
 of Trade, Mr. Runciman, acknowledged in a speech 
 delivered last year in the House of Commons, in words 
 which might with advantage be inscribed and hung 
 up in that Department's offices : " There should be 
 no essential articles either for the arts of peace or for 
 the arts of war, which we could not in the Empire lay 
 our hands upon." We were the pioneers not only in 
 arts and manufacture, but also in the early development 
 of these great States under our Monarch's sway, and 
 yet we have in recent years allowed foreign countries, 
 Germany in particular, to control the development of 
 many of their national resources and materials, such as 
 zinc, copper, tin, spelter, aniline dyes, pharmaceutical 
 products, palm-kernel oil, etc. Regarding the latter 
 product, Mr. Bonar Law took effective steps last year 
 to prevent its being in future annexed by a foreign 
 
IMPERIAL RECIPROCITY 287 
 
 agency, and caused some heart-burning amongst a few 
 cosmopolitan politicians by his patriotic action in this 
 direction. It is to be hoped that in future after 
 that good example we shall not be fatuous enough 
 lavishly to throw aside for the benefit of strangers 
 these bounteous natural resources belonging to the 
 Empire. 
 
 The statesmen of Canada, Australia, and New Zea- 
 land have also taken prompt, effective, and energetic 
 action in preventing this exploitation by our enemies 
 of these gifts of Nature in the boundaries of those 
 Dominions. 
 
 Having, so to speak, set to work to put our own 
 house in order by action both in the United Kingdom 
 and within the Empire, and to place our commercial 
 relations on a mutual and reciprocal preferential basis 
 with promptitude, we should also simultaneously or 
 immediately afterwards come to nearly similar arrange- 
 ments with the Allies, giving, however, as seems 
 fitting, a greater degree of preferential customs dues in 
 the case of members of our family circle beyond the 
 seas. We have, as Allies, all fought together, and it is 
 only reasonable that those who have incurred heavy 
 losses and huge debts in the same cause should do all 
 in their power after the war to assist one another by 
 co-operation in all practical directions during the re- 
 construction period, which will probably extend for 
 four or five years at least after the termination of 
 hostilities. France and England, despite the heavy 
 drain of expenditure during this war, into which they 
 were forced by Germany, will still remain two of the 
 wealthiest nations of the world, and should spare no 
 effort to assist theu* gallant Ally, Russia, in opening 
 
288 THE HOUR OF GREAT OPPORTUNITY 
 
 out and developing the vast resources of her great 
 Empire. Then take Italy. Before the war she 
 exported a vast amount of her grain and other produce 
 to Germany. Should she lose that market for any 
 cause, it should be the endeavour of the Allies to find 
 her markets to compensate her for that sacrifice. 
 Belgium, Serbia, and Montenegro, should the fortune 
 of war go as we hope and anticipate, will receive heavy 
 indemnities from Germany for the unspeakably heavy 
 losses and terrible destruction and sufferings they have 
 endured. Respecting Belgium, besides an indemnity 
 from the enemy, a preferential tariff in her favour 
 given by Great Britain, the British Empu'e, France, 
 Russia, and Italy would materially assist the recovery 
 of her industries and prosperity. 
 
 All these gravely important questions, and others of 
 a lundred description, deserve — and will, no doubt, 
 receive — the most painstaking and careful consideration 
 by the statesmen of the Allied countries of the Western 
 Entente and Japan, theii* gallant Ally in the Far East. 
 Their vast area and great potentialities of material 
 wealth of all kinds and descriptions, theii* manufactures, 
 and their busy masses of industrial workers will help 
 wonderfully, it is to be hoped, in rehabilitating and 
 restoring all these countries to their pristine state of 
 prosperity. 
 
 That Germany, if she can induce those who are now 
 her Allies to assist her, means to foist an economic 
 war on us after hostilities are over, seems clear. She 
 must be met and countered b}^ us, as arranged at the 
 Conference at Paris last summer, by equally deter- 
 mined economic action on the part of the Western 
 Allies. 
 
THE ALLIES AND THE NEUTRALS 289 
 
 Whilst this great struggle has been going on, in 
 which more men have been engaged, more blood has 
 been shed, and more lavish cost and expenditure in- 
 curred than in any previous war known, the neutral 
 nations have been onlookers watching the mighty 
 battle for civilisation and liberty which the Entente 
 Powers are fighting. They have not spent a drop of 
 their blood in the contest itself, or risked any money to 
 secure the blessings of peace — which boon, let us hope, 
 they and we may enjoy for many generations. Some 
 of them, in fact, have grown richer and richer while 
 the dread contest has continued. Their ships (saving, 
 of course, a few which the unheard-of brutality of the 
 Germans has, contrar}^ to the rule of war, sunk by 
 their submarines) have sailed the sea in security with 
 immense gain and profit to theii' owners, and their 
 mercantile marine, unlike that of the Allies, has not 
 been largely requisitioned by the various Governments 
 for warlike purposes. 
 
 It does not seem equitable, therefore, that, at any 
 rate during the period of reconstruction and rehabilita- 
 tion by the Allies, they should share in such preferential 
 treatment of their commerce as the Allies, who have 
 borne the heat and burden of the day, may see fit and 
 proper to give to one another. 
 
 That is, of course, merely a way of looking at the 
 question from an equitable standpoint, nor is there any 
 reason why, after the reconstruction period has passed, 
 they should not enter into these reciprocal and beneficial 
 commercial arrangements, or others of a somewhat 
 similar character. The whole of this question will, of 
 course, require serious consideration from many 
 standpoints. 
 
290 THE HOUR OF GREAT OPPORTUNITY 
 
 We all know the manner in which Germany has 
 seen fit to fight this war ; in a work of this sort re- 
 caxjitulation of the horrors she has defiantly perpe- 
 trated against all laws, human and divine, is not 
 needed ; they will be inscribed in the pages of history, 
 and will be borne in the minds of our people and those 
 of our Allies from generation to generation. 
 
 Now respecting the immense debt which each of the 
 Entente Powers has been forced to incur in this great 
 struggle forced on them by Germany. How can 
 Germany expect to be placed on the same basis as before 
 the war, and enjoy all the privileges of our trade 
 throughout the Empire, the hospitality of our markets, 
 the free entrance of her goods into our ports, while her 
 shipping only pays the same harbour dues as our own ? 
 This cannot be permitted. During the greater part 
 of the War the Western Allies have amongst them 
 had to spend between twelve and fifteen million pounds 
 sterling a day to counter Germany's insensate bid for 
 universal world-domination and " over all " power and 
 tyranny. This war was arranged after most crafty 
 and deceitful preparation, and was instigated not only 
 by the Kaiser and his military advisers, but, one now 
 sees, by the whole German people. If Austria had not, 
 at the instigation of German}^, thrown down the gage 
 of battle to Serbia, and made demands on that inde- 
 pendent State on a pretext which had not one scintilla 
 of evidence or clear proof to justify her ordering con- 
 cessions to be granted her by that country which it 
 was manifest no independent Power could possibly 
 concede, there would have been no war at all, nor 
 would the world have been the scene of this orgy of 
 bloodshed, destruction, and unspeakable horrors. 
 
THE DEMANDS OF JUSTICE 291 
 
 Again, Germany has looted that at one time wealthy- 
 country Belgium, and only last autumn actually 
 took from the Belgian National Bank money in the 
 shape of a forced loan to the amount of forty millions 
 sterling of her treasure ! The Germans are making 
 goods with what they have stolen from Belgium, 
 similarly in France (at Lille), and all the other 
 countries they have ravished and robbed. Therefore, 
 during the reconstruction period for the Allies, no 
 goods should be allowed m British ports from Germany 
 except such as the Government see fit to allow, on such 
 terms, m regard to entry, as they decide to permit. 
 
 There may be some things which we shall require 
 from Germany ; those, naturally, it will be in our own 
 interest still to receive from them during the reconstruc- 
 tion period ; but we should make a clear distinction 
 between those things for which, prior to the war, Ger- 
 many had the monopoly and which we noAv find we 
 can supply ourselves, and such products or goods, if 
 any, as we may find we are unable to procure either 
 in the United Kingdom, the British Empire, or in the 
 territories of our Allies. Regarding the powers forced 
 into the Central Alliance by their rules, other considera- 
 tions would seem to arise. 
 
 The question of some system of Imperial Federation, 
 or the establishment of a truly Imperial Parliament, 
 or Central Executive Council, by which the various 
 States or Units in the British Empke can be kept in 
 touch with one another more effectually than is possible 
 at present, so that they may mutually work together 
 for the good of the Commonwealth, has long been in 
 the ak. As far back as 1872 the following statement 
 on the subject was made by that great statesman. Lord 
 
292 THE HOUR OF GREAT OPPORTUNITY 
 
 Beaconsfield, in a speech delivered at the Crystal 
 Palace : 
 
 "I cannot conceive," he said, "how our distant 
 Colonies can have their affairs administered except by 
 self-government. But self-government, in my opinion, 
 when it was conceded, ought to have been conceded 
 as part of a great policy of Imperial consolidation. 
 It ought to have been accompanied by an Imperial 
 Tariff, by securities for the people of England for the 
 enjoyment of the unappropriated lands, which be- 
 longed to the Sovereign as their Trustee, and by a 
 Military Code which should have precisely defined the 
 means and the responsibilities by which the Colonies 
 should be defended, and by which, if necessary, this 
 country should call for aid from the Colonies them- 
 selves. It ought, further, to have been accompanied 
 by the institution of some representative council in the 
 metropolis which would have brought the Colonies 
 into constant and continuous relations with the Home 
 Government. All this, however, was omitted, because 
 those who advised that policy — and I believe their 
 convictions were sincere — looked upon the Colonies of 
 England, looked upon our connection with India, as a 
 burden upon this country, viewing everything in a 
 financial aspect, and totally passing by those moral 
 and political considerations which make nations great, 
 and by the influence of which alone men are distin- 
 guished from animals." 
 
 In what clear words did that great man convey 
 great and important aspects of State policy ! Seven 
 years afterwards, in 1879, in The Trade of the World, 
 written by the author of the present work just before 
 standing as a candidate for Parliament for the then 
 Borough of Cockermouth in the interests of the party of 
 
AN IMPERIAL COUNCIL 293 
 
 which Lord Beaconsfield, at that date Prime Minister, 
 was the leader, the important topic referred to in the 
 sentences just quoted was dealt with briefly. The 
 passage is repeated here as it expresses what would 
 seem to be the right lines to commence the consolida- 
 tion of the British Empire : 
 
 " It has often struck the writer of this work — and 
 I believe I am not singular in that respect — that if 
 it were practicable it would be well if there was some 
 permanent consultative body in this country either in 
 the form of a colonial council or some other institution 
 Smdred to our present Indian Council, to give, if re- 
 quired, advice and assistance to the Colonial Secretary 
 of State on matters connected with the Colonies. To 
 sketch lightly some suggestions on this subject, the 
 number of such a council might be about twenty 
 members, one-fourth of whom could be appointed by 
 the Government to represent the Crown Colonies, their 
 duties being those of a Parliamentary Committee 
 sitting en permanence, to investigate and report 
 to the home and colonial authorities on any question 
 affecting our colonial possessions, either with regard to 
 their military resources, their agriculture, their require- 
 ments as to emigrants, or the advantages they could 
 offer them. The question of a greater union in our 
 trade interests and a general tariff might be brought 
 before their notice in order to report on the subject to 
 the Imperial and Colonial Parliaments." 
 
 This matter was from time to time brought more or 
 less into prominence during the days of the Imperial 
 Federation League in the eighties, but for various 
 reasons it has again been allowed to lapse into the 
 region of unfulfilled ideals. It has again and again 
 been mooted at Imperial Conferences in a tentative 
 
294 THE HOUR OF GREAT OPPORTUNITY 
 
 manner, but except in regard to the appointment of 
 some members from the dominions on the Council of 
 Imperial Defence, no active steps have been taken 
 in parliament to bring it about. ^ 
 
 It has for the last twenty years seemed to the 
 writer that, until parties in Great Britain could agree 
 on a rapprochement in regard to a fiscal union, preferen- 
 tial or otherwise, within the Empire, a Constitutional 
 Union other than that of the Crown was impracticable. 
 Lately, as this trade question, owing to the circum- 
 stances of the present war, has come more prominently 
 forward and entered into the region of what are called 
 practical politics, so the question of constitutional 
 reform may also be soon approached in the same spirit. 
 
 Some of the questions to be solved in this connection 
 are as follow%s : should an Imperial Cabinet contain a 
 Minister for India and for the Crown Colonies, or should 
 the Central supervision and administration of these 
 parts of the Empii^e still be under the control of the 
 present Parliament of the United Kingdom, or, if 
 Ireland were granted Home Rule, that of Great 
 Britain ? 
 
 Again, is the Parliament now sitting at Westminster 
 to be the nucleus of a new Imperial Parliament with 
 representatives from Great Britain and the Lominions, 
 or is the Parliament of St. Stephen's still to have its 
 members elected only from the United Kingdom, 
 whilst still continuing to control solely the Foreign 
 affaks, the Army and Navy, and the Emphe generally ? 
 Again, are we to have a Dominion or local Parliament 
 for the affairs of Great Britain only ? 
 
 The inclusion of the representation of the whole 
 
 1 See Appendix I. 
 
CERTAIN CONSTITUTIONAL PROBLEMS 295 
 
 Empire into a central legislative assembly or Parlia- 
 ment would necessitate many changes from the present 
 Parliamentary form of procedure, and it would not 
 seem desirable, therefore, to put "new wine into old 
 bottles," or the result might prove as unworkable and 
 disastrous as in the parable. 
 
 Amongst the many other questions which would have 
 to be settled would be the number of the members, 
 their allocation from the various parts of the Empire, 
 including the Mother Country, the mode of election, 
 the qualification of the electors, and the normal dura- 
 tion of each Parliament. The representation, whether 
 by nomination of the various executive councils or 
 by a more direct form of appointment, of the various 
 coloured races in the Empire would require most 
 careful consideration. The total number of inhabi- 
 tants of European or white descent in the Empire 
 is approximately sixty millions, whilst those of other 
 descent are about six times that number. IVIr. 
 Worsfold suggests a kind of educational franchise 
 in the case of the natives of India with its population 
 of over three hundred and twelve million people. It 
 may appear somewhat doubtful if that proposal could 
 be carried into actual practice with satisfactory 
 results. 
 
 One of the first duties of this representative body, 
 when formed, would be to devise a plan for an equitable 
 distribution of the charges for Imperial defence within 
 the confines of the Mother Country and the British 
 Dominions. In a recent work dealing with this ques- 
 tion, very elaborate details are set forth as to the 
 manner in which this sum of money should be collected, 
 in case of default, from any unit of the whole. These 
 21 
 
296 THE HOUR OF GREAT OPPORTUNITY 
 
 precautions seem superfluous, as the occasion for their 
 use is never likely to arise. 
 
 Before the Imperial Parliament representing all 
 parts of the whole came into existence these questions, 
 and many others, would require solution. 
 
 As a preliminary step to this end, it would seem to 
 be desirable at an early date to call together an Imperial 
 Council or Conference of delegates from the Dominions, 
 and also, as is now agreed to by the Government, from 
 India, together with certain representatives of the 
 Mother Country ; and as the matters they would have 
 to consider and advise on would be numerous and 
 important, and would take time, they should constitute 
 a council of a more permanent nature than the Imperial 
 Conferences hitherto summoned have been. It would 
 seem advisable that they should be called together for 
 a period of at least four years. It is not improbable 
 that they might ask the Government to appoint a 
 Royal Commission to report on the constitutional 
 problem of Imperial Parliamentary Federation, with 
 power to that Committee to draft a Bill on the subject 
 for submission for the approval or non-approval of 
 the various existing Parliaments in the Empire and the 
 Viceroy of India's Council. 
 
 If that was the case, it would appear advisable that 
 each House of Parliament in the Empire or Council 
 should have the power of accepting this measure 
 when presented to it, or of rejecting it, but not of 
 amending it, for if that was the case the proceedings in 
 respect to its final acceptance might be endless. 
 
 Some central body representing the Empire generally 
 should be entrusted with the power of considering and 
 approving of, or rejecting, any amendments to this 
 
FOREIGN AFFAIRS 297 
 
 proposed measure, and it would seem that the Imperial 
 Council or Conference previously referred to would 
 meet that demand. Presuming that central legisla- 
 tive assembly made amendments to the proposed 
 measure, the Bill as amended would have again to 
 be sent to the various Parliaments for their approval 
 or not. 
 
 Should the four-year term for which the first Imperial 
 Council in Conference was summoned expire before a 
 constitutional change of this magnitude was passed 
 and during the consideration of it, it would seem 
 desirable either for a further term to be given to the 
 Council then sitting or for a new Council to be sum- 
 moned to continue its duties. 
 
 In the minds of some who have wTitten on this sub- 
 ject, it would appear as if there was a desire to urge the 
 consolidation of the Imperial interests of Greater 
 Britain by the constitution of a central representative 
 body of the various parts of the Empire chiefly, if not 
 solely, on the grounds that at present the Dominions 
 have no voice in Foreign Affairs, and that their views 
 should be considered respecting these matters at times, 
 on extremely delicate and momentous subjects. 
 
 One would venture to say, in this connection, that 
 no more risky course could be adopted, or one less 
 fruitful of good, than a departure from the present 
 plan of the existing Imperial Parliament of practising 
 extreme reticence and self-abnegation in avoiding dis- 
 cussion on stormy subjects which are full of pitfalls 
 and dangers. 
 
 The Parliament at Westminster knows that there are 
 times when matters relating to foreign policy change 
 from day to day, almost from hour to hour. These 
 
298 THE HOUR OF GREAT OPPORTUNITY 
 
 must, in practice, be left to the Government of the day, 
 and to the Foreign Secretary especially appointed to 
 safeguard the Empire's interests on such matters. No 
 change would appear desirable in regard to that, 
 whether foreign affairs are left within the scope of the 
 duties of the Parliament as now constituted, or of one 
 elected by the various parts of the Empire. 
 
 Our system of the control of those questions would 
 seem superior in practice to that of the United States, 
 where foreign affairs are controlled by their Senate, 
 and canvassing and other noxious systems of wire- 
 pulling may often take place, organised by the partisans 
 of one point of view as against those opposed to them. 
 
 Even at contested elections in the United Kingdom 
 the candidates do not, as a rule, base their arguments 
 or speeches at election times much on foreign affaks. 
 There are, no doubt, exceptions to this rule ; for the 
 election of 1880, for instance, was fought very largely 
 on the alleged misrule and barbarities of the Turks in 
 Bulgaria, " The Bulgarian Atrocities " as they were 
 called. 
 
 Mr. Gladstone, in some way that one could never 
 clearly see he proved, attempted to foist on the then 
 Government, of which Lord Beaconsfield was Premier, 
 the indirect responsibility for these atrocities, said to 
 have been committed by the Turks in suppressing a 
 revolt in Bulgaria. If we may judge of events as we 
 see them now, both British political parties were then 
 partially wrong. The Bulgarians were not quite the 
 sainted martyrs they were pictured in Mr. Gladstone's 
 fiery speeches, nor were the Turks as worthy of our 
 countenance and support as they then seemed to be. 
 
 Things change even more rapidly in respect to 
 
THE MERCANTILE MARINE 299 
 
 foreign affairs nowadays, and only those judging 
 them from within can know their intricacies and com- 
 pHcations, especially in dealing with such a country as 
 Greece, for example. An Imperial representative, for 
 instance, leaving a distant Dominion of the Crown, 
 with his mind set on what he conceived to be the true 
 aspect of foreign affairs, might find on his arrival that 
 circumstances had absolutely altered. 
 
 The grave and great constitutional change thus out- 
 lined must, when it comes, be the result of human 
 endeavour and human skill. It must be built on sure 
 foundations, adaptable to times of stress and difficulty 
 as well as fair weather, must be suited to meet reason- 
 able alteration if circumstances so demand, and made 
 worthy of the great Empire and peoples within its 
 scope. 
 
 There are many deeply important questions respect- 
 ing the Mercantile Marine of all parts of the Empire 
 which will have to be settled when this war ends, and 
 without doubt absolute and full compensation should 
 be given to our shipowners and merchants for the loss 
 they have sustained at the hands of the enemy, in very 
 many instances by acts of piracy. The Merchant 
 Service has done much for us, and we must see that they 
 do not suffer for it. The ton-for-ton policy is the least 
 they are entitled to. We might also initiate a scheme 
 to better the condition of the personnel of the Mer- 
 cantile Marine, and amongst other things make it 
 obligatory that a due proportion of the men, and if 
 possible all the officers, should be, in British ships 
 within the Empire, British subjects. 
 
 We have, durmg the last two years, extemporised 
 a unity of action to meet the tremendous dangers to 
 
300 THE HOUR OF GREAT OPPORTUNITY 
 
 which we have been exposed. In truth we were 
 greatly taken by surprise, working, as we were, 
 singly towards peaceful self-development, when the 
 Central European combination sprang the mines they 
 had been preparing under our feet — although they, 
 fortunately for us, did not succeed in their object in 
 its entirety or cause the havoc, disruption, and ruin 
 they were intended to create. 
 
 Questions of Imperial defence, and other questions 
 of deep importance await solution, and are capable of 
 it if approached in the right spirit, as Lord Milner 
 pointed out at a Conference of the Empue Parlia- 
 mentary Association held in the House of Commons 
 Committee room in the summer of 1916, which the 
 author attended. His remarks were as follows ; 
 
 " Set any number of representative public men to 
 discuss the establishment of a genuine partnership of 
 the self-governing States in the defence and policy of 
 the Empire as an open question, and nothing may come 
 out of it but a pile of Blue books. But let them feel, 
 whatever the actual terms of their reference, that what 
 the people they represent deske is not discussion, but 
 action — that the question they have to answer is not 
 * Is this thing to be done ? ' but ' How is it to be 
 done 1 ' and the outcome will be a more or less com- 
 plete, but perfectly definite scheme." 
 
 The theory which the free-import traders of the 
 middle of last century held was that their policy would 
 produce cheapness and brotherly love and affection 
 amongst nations, and would, in consequence of the low 
 rate of labour, manufacture more cheaply and sell more 
 goods at higher profit. But their prophecies have all 
 proved false. War is as frequent as ever, food is dearer, 
 
NEGLECT OF HOME INDUSTRIES 301 
 
 and the foreigner, whilst sending his products to our 
 markets, keeps out ours by protective tariffs, so our 
 increment in the manufacture of other goods, iron, steel, 
 etc., has not been so rapid, so large, nor so continuous 
 as that of our foreign rivals. What the followers of 
 Cobden have succeeded in doing by their free-import 
 trade policy is to make England year by year more 
 dependent on an outside food supply, and to drive the 
 people from the land and the plough to the factory, 
 the emigrant ship, or 'the workhouse, as the Cob- 
 denites were told would be the case when they passed 
 their schemes into law. 
 
 The next point we must bear in mind — and it is 
 one which every civilised race, except ourselves, within 
 the confines of the United Kingdom, carries out in 
 actual practice— is that "All goods and products, 
 whether manufactured or raised at home or abroad, 
 should equally contribute to the taxation of the 
 country." We, on the contrary, adopt a totally 
 different system. We tax the home industries heavily. 
 In the last few years, by means of what are described 
 as social reforms, we have added burden upon burden 
 to the tax-payer. Further, we have let the foreign 
 goods in free, if by any means it is discovered that we 
 can manufacture or produce them in these Islands. 
 This has probably been done to swell the bulk of our 
 import trade, which is, according to the free-import 
 traders, the sole end and object of trade and commerce 
 and the sole measure of a nation's prosperity. We, 
 further, unlike all other nations in the world, pursue 
 a policy which tends to cheapen luxuries in our midst, 
 and hence encourages extravagance, and we do this by 
 steadfastly refusing to tax any foreign-made luxuries 
 
302 THE HOUH OF GREAT OPPORTUNITY 
 
 for the rich, such as lace, expensive furs, jewellery, etc., 
 adornments of all kinds and descriptions. 
 
 A few words respecting the Income Tax may be much 
 to the point here, as it is, without dovibt, when raised 
 to too high a figure, an aggressive impost in times of 
 peace, though no one can object to it during the 
 stress of war as at present, in order to raise the necessary 
 funds, the purpose for which it was originally framed, 
 Mr. Gladstone, by the way, promised to abolish it in 
 1860, but years afterwards, when Chancellor of the 
 Exchequer, he was either unwilling or unable to keep 
 that pledge. 
 
 The income tax falls, no doubt, chiefly on the patient 
 law-abiding class in the fiLrst instance ; when, as at 
 present, levied as a graduated tax, it is drawn from 
 what would afterwards form the accumulated wealth 
 of the country, it discourages thrift and saving, and, 
 though no doubt its object is to tax the few and gain 
 the applause of the many, and to help the working- 
 classes, its result in normal times is the direct reverse. 
 In reality it bears very heavily on the working- classes 
 through the employers of labour, and is the direct 
 cause of a vast amount of unemployment. 
 
 Our authorities have become so enamoured of this 
 form of taxation, for some reason best known to them- 
 selves (it may be its ease in collection), that our Budgets 
 do not attempt, as was done at one time, to distribute 
 equally the burdens between direct and indirect taxa- 
 tion, but lump two-thirds of it, at least, on to the former. 
 Nor, in the case of a British subject earning money 
 in another part of the Empire — in India, Australia, 
 Canada, for instance — and residing in the United King- 
 dom, are they content with making him pay only once 
 
INCIDENCE OF THE INCOME TAX 303 
 
 on his income towards the general defence of the realm 
 of which the United Kingdom forms a part, but they 
 make him pay twice, and in some instances a treble 
 income tax is demanded of him. It is not necessary 
 to go into this question here at any length ; it will 
 suffice to point out that it is a gross anomaly which, no 
 doubt, will be remedied when our Imperial Council, or 
 Parliament for the Empire, comes into existence, if 
 not before. 
 
 A short extract from a memorandum by the Hon. 
 J. G. Jenkins, Treasurer of the British Imperial Council 
 of Commerce, gives a clear resume of the anomaly now 
 complained of, as follows : 
 
 " The duplication of taxation within the Empire 
 did not arise until the Dominion Parliaments first began 
 to impose a tax on income for revenue purposes. Since 
 then the duplication has continued. Until recently 
 the rates of taxation, both in the United Kingdom 
 and such Dominions as imposed an Income Tax, were 
 of only moderate amounts ; although in principle 
 wrong, it was not seriously disadvantageous or harmful 
 to Imperial interests or such a charge upon those 
 affected as to cause any strong protest or agitation for 
 reform. 
 
 " Since the passing into law of the Finance Acts of 
 1914 and 1916 of Great Britain, and the Commonwealth 
 of Australia Acts Nos. 34 and 41 of 1915, the double 
 tax has now, so far as Australia is concerned, become 
 a treble tax as regards companies, firms, or persons 
 liable." 
 
 In the United States, which is usually considered a 
 more democratic country than the United Kingdom, 
 in 1894 a graduated income tax was condemned by the 
 
304 THE HOUR OF GREAT OPPORTUNITY 
 
 Supreme Court as contrary to the Constitution, and a 
 violation of the liberty of the subject, " being voted by 
 the many and falling on the few." In the United 
 States they have a written Constitution, which cannot 
 be tampered with and altered, as is the case here, by a 
 temporary majority. Their policy is that the best 
 taxation is that which is levied on articles of consump- 
 tion, luxuries especially, and they consider that such a 
 course has a tendency to encourage frugality, if judici- 
 ously imposed, whilst being confounded with the price 
 of the commodity in the market, it is scarcely perceived 
 by the consumer. 
 
 Taxes, after all is said and done, are like a medicine 
 which is needful to be taken. If the patient prefers 
 taking his dose with a conserve, why not let him do so ? 
 The stern so-called "Free Trade" doctors based their 
 prescriptions on two cardinal fallacies, — first, that the 
 burden of imports, whether the same goods or products 
 could be produced or not in the importing country, 
 must fall on the consumer ; and, secondly, that a tariff 
 must increase the cost of the article taxed. Having 
 got hold of a quack nostrum which, they say, did good 
 to the patient in his infancy, they refuse to see that the 
 altered conditions of his constitution, in his mature 
 years, requires another remedy. 
 
 In plain words, they stick to what they fondly think 
 Adam Smith taught in respect to political economy in 
 the eighteenth century under totally different conditions 
 of the world's relative progress and industry from 
 those existing to-day. 
 
 The utter failure of the promises and predictions by 
 which the people of England were cajoled into adopting 
 their present fiscal policy should be a strong argument 
 
GREAT BRITAIN AWAKENED 805 
 
 against its continuance. According to the theory of the 
 Free Traders, America, and the other large States which 
 have adopted a protectionist policy, should have been 
 ruined ; but, on the contrary, they are prospering 
 exceedingly. 
 
 We must, then, throw aside musty tomes of economic 
 lore written in a bygone age, regarding such text- 
 books as false guides, and we must face fresh facts and 
 situations with fresh minds, old ideas and theories 
 being worse than useless. The people of this country 
 and of the Empire will not, it seems clear, be satisfied 
 in future with a policy of procrastination in regard to 
 this or any of the other great questions which demand 
 action ; and if, after the War, they find the issues at 
 stake have not been grappled with, and that, instead of 
 being completely settled, they are not even approaching 
 solution in a way befitting our place in the world, 
 they will be bitterly disappointed. The people of 
 Great Britain are awakened to the gravity of the situa- 
 tion. They are aware that they may have to face great 
 dangers and privations, but they also know they are 
 free to choose their own destiny, and that they now have 
 a National Government whom they believe they can 
 rely on to take action and steer the ship of State 
 successfully through troubled waters. 
 
 We may be told that we cannot move for fear 
 of retaliation. That argument must be treated with 
 contempt. In any case, we shall receive the least 
 portion of the trade of the Central Empires they can 
 possibly give us. How can a group of peoples with 
 only eighteen per cent., in all, of the world's trade 
 retaliate with success on the grand alliance of nations 
 of which the British Empire forms a part, with its 
 
306 THE HOUR OF GREAT OPPORTUNITY 
 
 control of fifty per cent, of the remainder, not in- 
 cluding in this estimate the United States ? In the 
 future, as in the past, we shall have to meet the clash of 
 commercial and industrial competition. We shall do 
 so fortified and strengthened by the example of our 
 kinsmen beyond the seas, who have stood nobly by us 
 in times of stress and difficulty. 
 
 The Empire has been proved in the fiery furnace of 
 a great danger, and has come through this ordeal, so 
 far, purified and strengthened. It must be our aim 
 to cement this union of the States beyond the seas with 
 the Motherland by further co-operation in many ways, 
 and, where practicable, by ties of Imperial Federation, 
 giving to all who are our co-partners some share in 
 the destinies and governance of the British Empire. 
 
 There has been a strong current of public opmion in 
 recent years in favour of reconstituting the office now 
 held by the President of the Board of Trade, and making 
 that Department of the State of more importance in 
 relation to the other Governmental Departments and 
 bringing it more in touch with the actualities of modern 
 industry, modern trade, and modern commerce. Should 
 a ministry of that description be evolved, it might be 
 aptly described as the Ministry of Industry and Com- 
 merce, the former being the mainstay of any truly great 
 country, and the latter the handmaiden of industry, 
 rather than, as mistaken economists of the middle of 
 last century considered, the mistress. Commerce in- 
 cludes in its wide scope trade wholesale and retail. 
 
 The name is, of course, of no importance. The fact 
 that such a ministry was established and set to work to 
 solve some of the many problems in regard to industry 
 or trade that have in recent years been allowed to be put 
 
WORK AND WAGES FOR WILLING WORKERS 307 
 
 aside, would be of the highest benefit to the community. 
 There are, no doubt, a vast number of important ques- 
 tions which have had to give way to other subjects more 
 vehemently pushed to the front by political agitators, 
 such as attacks on the House of Lords, Ireland, the 
 disendowment and disestablishment of the Church in 
 Wales, and such-like matters, and these have stopped 
 the way. 
 
 Several reforms are still awaiting solution, but this 
 is not the same thing as saying that they could all be 
 carried in a few years, even if the Parliament of the 
 United Kingdom were relieved of some of its duties 
 by the establishment of a Pan-Britannic Imperial 
 Parliament, or by Ireland having a Parliament of its 
 own, and its sons delivering most of their speeches at 
 St. Stephen's Green instead of Westminster. One 
 knows that could not be the case from personal experi- 
 ence, after having had a seat, during three Parliaments, 
 in the House of Commons. 
 
 One of the greatest questions which the country 
 will have to consider at the termination of hostilities 
 will be (unless some of us are greatly mistaken) that of 
 work and wages and employment for the discharged 
 soldiers, and for all capable and willing workers in the 
 United Kingdom. We must aim at extending our 
 agriculture and manufactures, which will, in conse- 
 quence, give the fullest possible employment to our 
 workers. We must also see that our trading vessels 
 are free from the shackles of foreign legal entangle- 
 ments as to what ports they may call at, what freights 
 they may charge, and other curtailments of their just 
 opportunities. 
 
 When the resolutions passed at the Paris Conference 
 
308 THE HOUR OF GREAT OPPORTUNITY 
 
 are acted on — and there is no doubt that the people 
 of this country wish to adhere to their terms, our 
 industrial welfare will be assured in due course and 
 both masters and men will share in the increased 
 prosperity of our home industries. Strikes and lock- 
 outs will then be less liable to occur, more especially in 
 those concerns where profit-sharing is, to a certain 
 extent, introduced, fluctuations in expansion and 
 depression of trade will not be of such frequent and often 
 unexpected occurrence as at present ; and a tariff 
 system will tend to steady the conditions of industrial 
 enterprise, and give to the capable and industrious a 
 higher probability of permanent success. 
 
 The war has been fought in vain if it does not bring 
 together all sections of the community into a loyal 
 co-partnership for the common weal. All feelings of 
 distrust, or of latent hostility, between employer and 
 employed should be dismissed, and a new ideal of 
 trust and confidence substituted for them. " The 
 mists of suspicion between class and class must be dis- 
 pelled as clouds on a gloomy day are thrust aside by 
 the effulgence of the sun ; if we loyally work together 
 as a united people the prosperity of our race will be 
 assured." May that hope be realised. The people 
 of the Dominions, as of the Mother Country, are still, 
 however, looking for a sign of the future policy of our 
 Government, and wondering whether those in authority 
 are awake to the urgency of the questions which await 
 solution. 
 
 The agricultural lands of a nation may and should 
 become more developed and intrinsically valuable as 
 years roll on, reinforced as they ought to be by scientific 
 and sensible treatment. A question which might well 
 
THE OWNERSHIP OF BRITISH SHIPS 309 
 
 be considered by a Minister of Industry and Ck)mmerce 
 is whether it would not be advisable, not only to take 
 stock of the natural products within the Empire (more 
 particularly such products as anthracite coal, zinc, 
 copper, etc., as is being done), but also to consider 
 whether we should not nationalise a sufficient quantity 
 of them for an emergency, compensating the present 
 owners. 
 
 Under the British Nationality and Status of Aliens 
 Act, 1914, an alien is entitled to acquire freehold and 
 leasehold property of any description in the country he 
 is naturalised in . This w ould include a right to acquire, 
 for instance, steam coal in Welsh mines, minerals in 
 Canada, and forest land in Newfoundland. Again, an 
 alien is not entitled to own or hold a share in a British 
 ship, but, under the law as it at present stands, a 
 Company entirely alien in its composition, provided 
 that it is registered as a British Company, is entitled 
 to hold a British ship. 
 
 That is to say, in fact, that whilst one foreigner 
 cannot own a part of a British ship as an individual, 
 a group of foreigners by registering themselves as a 
 Public Company can own a whole British ship, and, 
 whilst residing in Prussia and " strafing " England, 
 enjoy all the privileges of British citizens in respect 
 thereto, with none of the obligations of paying our 
 taxes or of giving personal service in time of war, which 
 the latter have to do. Could not the Legislature find 
 time to consider such an anomaly as this, recollecting 
 how much w^e owe to our Mercantile Marine and their 
 gallant crews for what they have accomplished during 
 the last two years ? 
 
 In October of the year 1916 another matter con- 
 
310 THE HOUR OF GREAT OPPORTUNITY 
 
 nected with this subject came before the French 
 Chamber, who are taking powers to revoke the naturali- 
 sation of enemy aliens (Russia has already taken steps to 
 denaturalise or intern most of her dangerous Russianised 
 Germans). The vital argument in this matter is that a 
 German, under his country's Delbriick Law, can com- 
 fortably take the oath of allegiance to his adopted 
 country while remaining a German loyal to his Kaiser. 
 
 There is one measure from which, if it were practic- 
 able, great advantage to our trade and commerce, and 
 to those engaged therein, would accrue, and that is — 
 uniformity of Commercial Law throughout the Empire. 
 If that were left to the consideration and enactment of 
 all the present Parliaments of the Empire or Legisla- 
 tive Councils, which are said to number no less than 
 seventy, it would be found impossible to get them to 
 agree on the details of such a reform. If, however, 
 the codification of Imperial Statutes on that subject 
 were left to a central legislative body for the Empire, 
 it might be done. It would seem clear that there are 
 reasons of a special description why the commercial 
 laws all over the Empire should be similar. A man 
 engaged in business transactions does not confine his 
 transactions to one part of the Empire. Trade and 
 commerce know nothing about political or geographical 
 boundaries. 
 
 If a man in business wishes to transmit goods or 
 money from one part of the Empire to the other, or 
 in the case of bills of lading, he will find himself con- 
 fronted with all sorts of legal systems, and getting others 
 to interpret and unravel then* complexities for him 
 will cost him either time, labour, or money, in some 
 instances all three. The law relating to bills of ex- 
 
LEGAL REFORMS REQUISITE 311 
 
 change, cheques, etc., should certainly be assimilated 
 throughout the length and breadth of the King's 
 Dominions, but that has never been done. 
 
 In 1882 Parliament passed in clear and definite 
 language (not always the case, by the way, in Acts of 
 Parliament) the Bills of Exchange Act. That Act is 
 only operative in the United Kingdom ; it has, however, 
 been copied, it is said, in every part of the Empire 
 that has a legislature, but in some instances slight 
 divergencies and local differences from the original Act 
 have crept in. For instance, in Canada the risk to a 
 banker who pays on a forged endorsement is greater 
 than it is in England. In South Africa three days 
 of grace on a bill of exchange are unknown. This 
 must, at times, cause confusion. If there could be a 
 complete uniformity established and a uniform law 
 within the Empire as to bills of exchange, no doubt 
 the inter-Imperial assimilation of other branches of 
 commerce would follow in due course. 
 
 It seems very desirable that a careful revision should 
 be made of the mode in which British Patents are 
 granted to foreigners ; the words " adequately worked " 
 in those patents should be changed to " three-fourths 
 worked," as the former is too vague an expression ; a 
 colourable working is, in practice, deemed sufficient, 
 and the intention of the Act to encourage home in- 
 dustries is, in consequence, evaded and made a dead 
 letter. Were a system adopted by which a patent or a 
 copyright taken out by a British subject was in force 
 not in one part only, but in the whole Empire, on the 
 payment of higher fees, it would seem a small move 
 in the right direction. 
 
 It is also advisable that a mutual agreement should 
 22 
 
312 THE HOUR OF GREAT OPPORTUNITY 
 
 bo come to amongst the Allies as to patents, and that 
 the working in one country should be considered a 
 sufficient working in the other countries without the 
 patent lapsing in their countries. 
 
 It seems a pity that Canada has adopted the dollar 
 as the unit, and not the pound. In another part of 
 this work reference has been made to the great advan- 
 tage which the United Kingdom would enjoy if the 
 metric system of weights and measures were adopted. 
 Its general adoption throughout the Empu'e would, 
 naturally, be of even greater benefits, as would also be 
 the easy and practical simplicity of decimal coinage. 
 
 By the energy and perseverance of the author's late 
 friend. Sir J. Henniker Heaton, we have given one 
 another, as a rule, throughout Greater Britain slightly 
 lower and preferential rates for letters and parcels 
 than is the case in regard to postage to most foreign 
 States. One wonders why it never struck the "Free 
 Traders " that the advantage of a preference thus 
 given as between the United Kmgdom and the 
 Dominions might whet the appetite of the inhabitants 
 of this country for preferences in many other more 
 important directions. 
 
 The advantage of correspondence by letter is the 
 mutual interchange of ideas, as, in commercial traffic, 
 of goods. As arranged by the Postal Union, we pay 
 the same amount in writing to foreign States as they 
 pay in sending letters to us. If the " Free Traders '' 
 were right it would not matter how few letters on 
 business our merchants wrote abroad, or what the rate 
 of postage was, whether it was six times the amount 
 the foreigner had to pay on sending a letter to the 
 United Kingdom. Their argument would be : the sole 
 
HOW TO RESTORE INDUSTRIES 313 
 
 advantage of correspondence is the number of letters 
 you receive, and it would make no difference what 
 cost you were put to in sending replies to those letters, 
 as they now say the sole advantage and gain in the 
 trade of a nation are its imports. 
 
 There are very numerous industries which could 
 easily be restored to a position of prosperity in this 
 country, as well as others in which we have never yet 
 competed, if successfully introduced, and no lack of 
 capital would be experienced in either case if the 
 manufacturer only felt secure that his market would 
 not be taken away. As Mr. M. Barlow, M.P., has said 
 in the House of Commons : " You give me security 
 that my market will not be taken away for ten years, 
 and I will put down machinery and do it." 
 
 It should, further, be our aim not only by a scientific 
 tariff to prevent our industries being attacked and 
 possibly undermined by foreign dumped goods and 
 other similar devices, but also to provide adequate 
 Governmental grants to encourage technical education 
 in chemistry, engineering, mechanics, and agriculture, 
 more generally than is the case at present ; though the 
 skill and proficiency of those amongst us who have 
 studied these subjects leave nothing to be desired. 
 Should these industries increase, however, as is to be 
 hoped, more experts in them will be required. 
 
 If goods made in this country are to maintain their 
 position in the markets of the world, there is a necessity 
 not only for the equipment of the factories and work- 
 shops to be thoroughly up to date, as most of them are 
 said to be, but also that the workers should give us, as 
 in America and elsewhere, a fair day's work for a fair 
 day's wages, and that the undue limitations imposed 
 
314 THE HOUR OF GREAT OPPORTUNITY 
 
 by some of the trade unions on their members be 
 modified, and the output be, in consequence, increased. 
 
 After-war preparations are being vigorously pushed 
 forward in Germany. Raw material, it is said, will be 
 one of her first necessities for the revival of trade, and, 
 in consequence, the principal shipyards are busily 
 engaged in constructing huge cargo-bearing vessels, 
 and also liners to gain the ascendancy in the profitable 
 transatlantic trade. When peace comes, if Germany 
 only gains a partial success she will endeavour to 
 dominate the industrial spheres of activity in the 
 various countries of the world, an achievement which, 
 when she ruthlessly threw down the gauntlet to the 
 world from her " mailed fist," she was, no doubt, in the 
 way of attaining by her carefully planned organisation, 
 and system of so-called " peaceful penetration." 
 
 Germany knows that the struggle to regain the 
 export trade, to the value of £504,000,000, which she 
 enjoyed before the war will, at its conclusion, be a 
 severe one, and she has taken steps in all practical 
 ways to be ready. 
 
 One of the greatest dangers Great Britain, as an 
 industrial and trading nation, will have to face for some 
 time after the war will not be our present foe, or our 
 great and wealthy competitors in the United States, but 
 the action of the sentimental cosmopolitanists m her 
 midst, and of weak-kneed politicians at St. Stephen's. 
 
 We have the ball at our feet now if we take it in the 
 right way. People are gradually awakening to the fact 
 that the relationship between our security as a nation 
 and our economic policy is indeed close, and cannot 
 be disconnected, and that the more self-supporting a 
 country is, the more prosperous it is likely to be in 
 
NATIONAL SERVICE 315 
 
 time of peace, and the more powerful in time of war. 
 An endeavour has been made in these pages to urge 
 fair play for British Industry, and for that of Greater 
 Britain — not an open door for the foreign merchant 
 here, and a closed and locked one against the British 
 merchant abroad. 
 
 Thoughtful men of all parties are casting aside pre- 
 war prejudices, for they clearly see that our way of 
 security for the future lies in a well-considered system 
 of preferential trade for the Empire as a whole. For 
 generations when England was making her way, and 
 gradually becoming the centre of a great Empire, we 
 looked to the Plantations, as the Dominions were 
 then called, for our source of food, of raw material, of 
 arms and munitions of war, and were, in fact, a self- 
 supporting community. Persuaded by false prophets 
 to discard this system, in the supposed interest of a 
 fleeting cheapness, we became dependent and weak 
 and, as Germany imagined, an easy prey. 
 
 During the past two or three years we have been 
 casting aside this economic thraldom at an immense 
 sacrifice of men and money, and it is satisfactory to 
 note that the recently issued resolutions of Lord 
 Balfour of Burleigh's Committee support and advocate 
 a great and important step in advance towards Im- 
 perial consohdation, and also respecting the future 
 economic arrangements of the Empire, and the United 
 Kingdom with the Allies and the Neutral Powers.* 
 
 Taken as a whole, all parties, both in the Empire 
 generally and in the United Kingdom, have come 
 forward nobly at this grave crisis to do their duty. 
 
 * See Appendix IV. 
 
316 THE HOUR OF GREAT OPPORTUNITY 
 
 Neither men nor women, high or low, rich or poor, young 
 or old, have spared themselves. Women have, as a 
 sex, stepped most patriotically into the breach, and 
 carried on many duties, as a rule successfully, in 
 callings which had been previously considered only 
 men's work. The question of employment generally, 
 when the war ends, will be one of great urgency requir- 
 ing grave consideration. 
 
 The duty of both men and women to do everything 
 in their power to aid their country in this titanic 
 struggle we are engaged in against a highly organised 
 system of barbarism was early this year brought to 
 the attention of all by the Director of National Service, 
 Mr. Neville Chamberlain, when he pointed out the main 
 lines of his scheme of National Service, and the great 
 urgency of the demand for workers — ^that the matter 
 would not brook delay, and that we could not afford to 
 wait ; we must have the volunteers at once. 
 
 The scheme is at present to be a voluntary one ; 
 should, however, that fail, a compulsory one will have 
 to be adopted. Young and old are asked to join, but 
 if the former do so, and are of miUtary age, it will not 
 exempt them from service with the colours. 
 
 Our enemy will hesitate at nothing, having no respect 
 for any international usages of warfare or the customs 
 of civilisation. He not only has threatened, but as far 
 as he is able sinks at sight every merchantman and 
 passenger ship, and rejoices in the drowning of the 
 *' gallant messengers of plenty to this land " our 
 brave sailors. 
 
 We must hasten the building of ships of the Nav}^ to 
 cope with this submarine peril, arm all vessels of the 
 mercantile marine to destroy these reptiles and pirates 
 
NATIONAL SERVICE 317 
 
 of the sea, and speedily construct as many vessels as 
 possible to replace our losses. This submarine menace 
 we mastered before, and the author believes we shall do 
 so again. 
 
 Those who come to the nation's aid and join the band 
 of national workers will find that agriculture in this 
 country requires many more workers to increase the 
 home-grown food supplies. 
 
 In a speech the Prime Minister made at Westminster 
 this year, when National Service was introduced, he 
 said : " We are short of iron ore. I need hardly tell you 
 how important it is, not only in the conduct of the war, 
 but in providing ships to carry the raw material and 
 food." He also then indicated that we want labour 
 for loading and unloading ships and waggons, and that 
 a thoroughly democratic State has the right to claim 
 the services of all of its citizens when the fate of the 
 nation is at stake. It is in truth the duty of all to 
 organise civiUsation to defeat organised barbarism. 
 
 The work of the Paris Economic Conference was, 
 as far as it went, good. In conclusion may one again 
 point out that they were resolutions only and still 
 require carrying into effect. As Lord Derby, now 
 Secretary of State for War, said when presiding over 
 the Liverpool Chamber of Commerce at their Annual 
 Meeting last June i 
 
 " It was the duty of every Chamber of Commerce 
 and every commercial man, as we had accepted these 
 proposals and they were the considered judgment, not 
 only of ourselves, but of our dependencies and of our 
 Allies, to see that the proposals were put into concrete 
 form, and interpreted in such a way that the moment 
 the war was over they could be carried into execution." 
 
318 THE HOUR OF GREAT OPPORTUNITY 
 
 Throughout the United Kingdom and her wide- 
 spread Dominions beyond the seas, in all directions 
 one sees an awakened Emphe — a people who realise 
 that in this great war, and in the great industrial and 
 commercial struggle which will succeed it, there is one 
 of two alternatives awaiting us — success or failure. 
 From the Mother Country and from all parts of Greater 
 Britain resolute men have rallied to the flag to defend 
 the cause of liberty and justice. Purified by the supreme 
 sacrifice which many of them have made, may we who 
 still remain resolve that it shall ever float over a free, 
 a contented, and a prosperous people ! 
 
APPENDIX I 
 
 IMPERIAL REPRESENTATION 
 
 The Prime Minister on January 25th, 1917, explained the 
 objects for which the Imperial Conference has been con- 
 vened. The following are extracts from that important 
 announcement : 
 
 " The Empire War Council will deal with all general 
 questions affecting the war. The Prime Ministers or their 
 representatives wiU be temporary members of the War 
 Cabinet, and we propose to arrange that all matters of first- 
 rate importance should be considered at a series of special 
 meetings. Nothing affecting the Dominions, the conduct 
 of the war, or the negotiations of peace will be excluded 
 from its purview. There will, of course, be domestic ques- 
 tions which each part of the Empire must settle for itself — 
 questions such as recruiting in the United Kingdom, or home 
 legislation. Such domestic matters will be our only reser- 
 vation. But we propose that everything else should be, 
 so to speak, on the table." 
 
 War Policy of the Empire 
 
 " The war policy of the Empire wiU be clearly defined. 
 And of great importance is what I may call the preparation 
 for peace. That will involve not only demobilisation, but 
 such other after-the-war questions as the migration of our 
 own people to other parts of the Empire, the settlement of 
 soldiers on the land, commerce and industry after the war. 
 We have certainly not hesitated to depart from precedent.'* 
 
 319 
 
320 APPENDIX I 
 
 *' The terms of peace will be only a beginning. After 
 they are satisfactorily arranged we shall have to set to work 
 to build up that ordered freedom and fraternity which is the 
 only security for human peace and progress, and which 
 militarism has destroyed. And is it not certain that the 
 nations which have borne the heat and burden of the day 
 in overthrowing that militarism will take a leading share in 
 building that new earth which they have made possible by 
 their sacrifice ? No ; if we endure to the end I have small 
 fears for the future. And not the least important of the 
 foundations for the work we shall have to do together in 
 that future will be this War Council of the British peoples." 
 
APPENDIX II 
 
 LAND SETTLEMENT BY SOLDIERS 
 
 Reqaeding this deeply important question, the self-govern- 
 ing British Dominions have not left this matter to chance 
 or the " magic of patience," but many of them have already 
 taken active steps to be prepared and ready in regard to it 
 when hostilities terminate. 
 
 From Ottawa on January 11th, 1917, the following brief 
 report was sent to Great Britain of the steps taken by the 
 Canadian Government, that — ■ 
 
 " The two days' Conference of representatives of the 
 Dominion Provincial Governments convened for the pur- 
 pose of securing uniformity of action in dealing with returned 
 soldiers concluded to-day. The Government has prepared 
 a Bill providing for the settlement of Canadian soldiers and 
 British reservists from Canada in selected areas on home- 
 steads and lands under Federal control. The measure pro- 
 vides for agricultural training and financial aid by way of 
 loans under an administrative commission consisting of 
 three members." 
 
 *' A Renter's message says that a loan of £300 without 
 interest will be made to each settler for the erection of farm 
 buildings and the purchase of stock, and a further advance 
 will be made of £200 on the recommendation of the super- 
 vising Commissions. The settler who has lived three years 
 on the farm, and has repaid half the money advanced, may 
 dispose of the property." 
 
 321 
 
322 APPENDIX II 
 
 From Melbourne one learns during the same month that 
 the Australian Premiers at their Conference adopted a 
 sound repatriation scheme for the settlement on the land 
 of both Australian soldiers and sailors and those of British 
 nationality. Important steps in the same direction, as 
 previously pointed out in this work, have been taken by 
 New Zealand. 
 
APPENDIX III 
 
 THE UNITED STATES SEVER DIPLOMATIC 
 RELATIONS WITH GERMANY 
 
 The world was startled, though not surprised, to hear 
 this February that the United States had severed all diplo- 
 matic relations with the German Empire, and that the 
 American Ambassador in Berlin would immediately be 
 recalled. 
 
 The history of this ostracism of Germany by the United 
 States from being considered within the pale of civilised 
 nations is a lengthy one, and there is no intention in this 
 appendix to set forth the whole of the circumstances of the 
 case, or the forbearance the United States displayed in her 
 communications with this arrogant Germanic State. The 
 salient fact stands forth that after the sinking last April 
 without warning of the steamship Sussex bj^ a German sub- 
 marine, in which ship were several United States citizens, 
 some of whom were drowned, a strong note was sent by the 
 American Government to Germany demanding inter alia 
 an assurance that no such outrage on passenger steamers 
 should occur again. 
 
 The German Government gave that assurance to America 
 on "a scrap of paper.'' At that time the German sub- 
 marine fleet was in a very depleted state, owing to their 
 heavy losses of these undersea vessels, caused by the un- 
 ceasing activity of the British naval authorities. 
 
 Germany was at that time building with all speed larger 
 
 823 
 
324 APPENDIX III 
 
 and more powerful submarines with a more extended sphere 
 of action. On their partial completion this year, Germany 
 tore up *' the scrap of paper " in which she had promised to 
 desist from attacks contrary to the usages of war and inter- 
 national law on the mercantile marine of belligerent and 
 neutral powers, and forwarded one of the most insolent 
 diplomatic notes on record to the Government of the 
 United States, in which she denounced her former promise, 
 and, having repudiated it, declared her intention of sinking 
 all mercantile ships in certain seas adjacent to Great Britain, 
 France, and Italy at sight. The United States replied to 
 that insult at once with dignity and decision, and carried 
 out their threat of April 1916 — namely, that if this style of 
 barbarity by Germany was persisted in " The United States 
 can have no choice but to sever diplomatic relations with 
 Germany." 
 
 The United States Government dispatched notes to the 
 various neutral Governments of the world setting forth their 
 views on this subject, and pointing out the action of the 
 German Government in regard thereto. 
 
 Some of them replied fully concurring with the views of 
 the United States, but up till the middle of February 1917 
 no rupture of diplomatic relations has occurred betwixt 
 any of them and Germany. 
 
 The United States is still technically "a neutral power,'' 
 although it is stated that she is taking steps to put both her 
 Navy and Army in a position to be ready for emergencies. 
 
 There are some questions yet unsolved ; for instance, if 
 theaction of Germany causes the United States to commence 
 hostilities, will she come in as a full member of the Entente 
 Alliance, or in a more limited way ? Again, if America joins 
 in the war, will she or not subscribe to the agreement made 
 by the Allies and make peace only in concert, or will she 
 retain her liberty of action to make peace without con- 
 sulting any other nationality ? 
 
APPENDIX IV 
 
 REPORT REGARDING IMPERIAL PREFERENCES 
 AND COMMERCIAL TREATIES 
 
 The following resolutions passed hj the Committee on 
 Commercial and Industrial Policj^ of which Lord Balfour 
 of Burleigh is chairman, were issued as a White Paper 
 [Cd. 8482] on February 20th, 1917. 
 
 The Committee, which was appointed bj^ the late Govern- 
 ment, was a thoroughly representative one, and included 
 amongst its members many w^ho were, prior to the war, 
 considered to be staunch adherents of the Free Trade faith. 
 
 ''1. In the light of experience gained during the war, 
 we consider that special steps must be taken to stimulate 
 the production of foodstuffs, raw materials, and manu- 
 factured articles within the Emj^ire wherever the expan- 
 sion of production is possible and economically desirable 
 for the safety and welfare of the Empire as a whole. 
 
 *' 2. We therefore recommend that H.M. Government 
 should now declare their adherence to the principle that 
 preference should be accorded to the products and manu- 
 factures of the British Overseas Dominions in respect of 
 any Customs Duties now or hereafter to be imposed on 
 imports into the United Kingdom. 
 
 '* 3. Further, it will in our opinion be necessary to take 
 into early consideration, as one of the methods of achiev- 
 ing the above objects, the desirability of estabUshing a 
 
 325 
 
326 APPENDIX IV 
 
 wider range of Customs Duties which would be remitted or 
 reduced on the products and manufactures of the Empire, 
 and which would form the basis of commercial treaties 
 with Allied and Neutral Powers." "^ 
 
 These important resolutions are the first that have been 
 passed in this sense by a Committee appointed by the 
 Government. 
 
 Printed by Hasell, Watson & Viney, Ld., London and Aylesbury, England. 
 
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