.^,OfCAllfO% 0FCAIIF0% NMM'NIVFRJ//^ ^inSANCElfX/ o ^TilJONVSOr'^ -< \WEUNIVER% v^lOSANCElfj> ^^IUBRARYOa o ^^IIIBRARY<9/: ^(!/0JllV3JO'^ .^WEUNIVER%. o vvlOSANCElfjv. -< "^/sajAiNn-awv^ ^OFCAIIFO/?^ .^.OFCAilFO/?;^ '^SlLIBRARYQr^ ^ -< "^AaJAiNn^wv** ^OFCALIFO/?^ ^OFCAllFOfiV ^ o -< %83AINn•3W^^ \\\Ll!NlVtR% , ^ _ o >' ^WEUNIVERS//, o v^lOSANCElfj^ o >;..OFCAIIFO;?,{> ^OFCAlIFO/?>j^ "^/^aaAiNn-JWV^ ^^Aavaan-^^ ^OAavaan-^^^ ^ -s^UIBRARYOc. ^^lllBRARYQc. I li irri Si irrl y.v.1 V w/^ A>:lOSANCElfj^ Or-I o -< u3 .^^IIIBRARYQ^ '^ ^ 5 .^jOFCAllF0% ^OFCAIIFO;?^ %a3AiNn3WV ^^AHvaaiHS!^ AWE UNIVERi/A '^ '^XilJDNVSOV'^^^ =o 2 ^ ^/5a3AiNn]Wv -o^llIBPARY/9- % ^OFCAllFOff/i!^ £? t:^ ^CAHvaani'^ ^WE UNIVER^//. ^lOSANCElfj> o %83AINn-3WV .C^f fAlIFO/?,- 'mi ^0 '/>?- o O v>;lOSANGElfx> o ^ajAiNn-Jwv ^llIBRARY(?/ -^\\ILIBRARYQ<^ "^/sa^AiNnjwv^ '^ii/ojnvDjo-^ ^^ojiivdjo^ ^OFCAIIFO/?^ ^OFCAllFOff^ ^^AavjiaiiiV^ ^^Aavaaiii^"^' ;sv. o ^ AWEUNIVER% RYQ/r ^^IIIBRARYQ^ n <= ^^ I 1 1 /I = .^WE•llNIVERS•/A A>;lOSANCElfj> li irr TRADE, POPULATION AND FOOD. TRADE, POPULATION AXD FOOD. A SERIES OF PAPERS ON ECONOMIC STATISTICS. BY STEPHEN BOURNE. .... " a question which ha* given rise to great discussion of late, and which by some has been consiiiereil a most serious matter to our commercial position : I mean the fjreat anil growing difference between the value of the imports and export ■; of this country. I think the credit is due to Mr. liourne, a valued member of our .Society, for having first called attention to this phenomenon in a paper which he read last year Though I do not share in the gloomy conclusions which Jlr. IJourne draws from these figures, yet I think they are well worthy of consideration and require an explana- tion." — Speech by Afr. Sluiw-Lefevre as I^esulent of the Utatistical Hvcieti/, 2oth June, 1878. LONDON: GEORGE BELL AND SONS, YORK STREET, COVENT GARDEN. 1880. CHISWICIC PRESS .— C. WHITTINGHAM AND CO. TOOKS COURT, CHANCERY LANE. 3-5 0Q> TO THE RIGHT HOX. EARU GRANVILLE, K.G., SECRETARY OF STATE FOR FOREIGN AFFAIRS. My Lord, Having at an unusnally early age become inte- rested in the progress of political life during the stormy period which succeeded the Relief Act of 1829 and pre- coded the Reform Bill of 18o2, I have never wavered in attachment to those great principles which later on dic- tated the Abolition of Slavery in the West Indies (where I resided during the transition period) in 1834 and the removal of Restrictions on Trade in 1845. Having also in my boyhood been honoured by the patron- age of the then Lords Holland, Brougham, and John Russell, and received my first appointment in the public service at the hands of Lord Melbourne, I learned to venerate the champions of that liberal legislation which raised our country to its proud position of prosperity at homo and honour abroad. In your Lordship I now recognize the connecting link between the policy of those days and the more I'ccent de- velopment of the present times, — the able representative of British interests at the Court of our nearest neiy:hbour for a 42.'i'.iJ).'? Vi DEDICATION. considerable portion of the interval between the two periods, — and the enlightened administrator of our Foreign rela- tions at the present moment. Permit me, then, although personally unknown to your Lordship, to thankfully accept your permission to dedicate to you this volume, the result of many years of thought and labour spent in tho public service, in the hope that it may be received with favour as a slight contribution to the knowledge of the trading position in which the Empire stands. With much respect, Your obedient Servant, Stephen Bouene. London, Wtfi October, 1880. CONTENTS. FAGK Introductory. — Thk present Crisis in Tr.vde . . xi-xxvii I. The Official Trade and Navigation Statistics . . 1 ]\Ietho(ls adopted for collecting — Imports — Sources of information — Particulars required — Country of origin — Description of gords — Quantities — Values — Exports — Nature of records and publications — Alterations in sys- tems — Bill of Entry — Conclusion. II. The Progress of olr Foreign Trade — Imports and Exports during Twenty Years . . . . .(l Values, official, real, computed, declared — Gradual pro- gress of commerce — Proportion of trade — Principal arti- cles — Transhipments — Total imports, re-exports — Total exports — Value of imports — Value of exports — Pi-incipal articles of import and re-export — Ditto of export British produce — Quantities — Imports — Re-exports — Quantities and values of food — Raw Materials — Surplus of imports — Position of Trade — Tal)les, imports, exports. III. The Growing Preponderance of Imports over Ex- ports ........ a') Earlier period of trade — Period from 1854 to present time — Alterations to be made in relative values — Excess of imjjorts during past twenty years — Preponderance of imports in recent years — Conchuling remarks. IV. The Increasing Dependence of this Cointry ipox Foreign Supplies of Food ..... 76 Value of imports for series of years — (Jrain converted into beer anil spirits — Quantities of principal articles of Vin • CONTENTS. PAOB food — Quantities of bcverajjes and tobacco — Comparison of foreign supply witli home produce — Quantity oi'' home- raised wlieat and meat — Dependence upon extraneous sources for food of nation — Financial relations with rest of world. V. The Nature and Extent of our Fobkign Food Sup- plies, AND THE Sources from whence they ark DERIVED . . . • . . . .103 Value of food imports — Sources of supply — Different kinds supplied by different countries — Comparison of home with foreign supplies. VI. The Growth of Population with Relation to the Means OF Subsistence . . . . .114 Theories of Malthus — Census Reports of 1871, sub- division into classes — Agricultural class — Industi-ial — Census division into sexes — Food-producei's — Objections to unlimited numbers — Increase of productive power a source of prosperity — False economy of restriction. VII. Duties on Wine. ....... 133 Proposed alteration — Rates of spirit duty on different liquors — Suggested rates of duty to be charged — Objec- tions — Difficulties. VIII. Excess of Imports and Trade Depression . . .138 Are we consuming capital ? — Figures of Imports, exports, and excess of former — Sources from which to be met — Probability of improvement — Foreign competition — Subdi- vision — Effects of excess imports — Want of economy — Remedy. IX The True Relation between Imports and Exports . 162 Origin of trade— Its progress — Conditions under which excess of imports is satisfactory — Also when exports are so — Trade from 1699 to 1815-^From 1S16 to 1878— Trade of Russia — Franee^United States — Our trade with the United States — Balance of trade — Food and wages — Reci- procity — Protection — Proposed remedies. CONTENTS. - IX PAGE X. Some Phases of the Silver Question . . . 199 Connection of gold with silver — Relation of production and quantity of precious metals to state of trade — Suffi- ciency of gold supply — Fall in prices — Purchasing power of gold — Variations in tlie value of gold — Production and depreciation of silver — Depression of trade — Bi-metallic and other theories — Concluding remarks — Postscript. XI. The Decay of our Export Trade .... 236 Progressive decline in its total value — Question whether in volume or value— Tables, 1872, 1873, 1877, 1878, 1879 — Sources of variations in exports — Imports not more satis- factory — Causes of decay and remedy — Free trade and protection. XIT. Social Aspect of Trade Depression . . . . 250 Long continuance of — Natural condition — Prosperity *^ of 1872-3 — Trade inflation — Progress of export trade — Social revolution imjiendlng — Bad iiarvests — Reduced ex- ])enditure — Undue exaltation of wealth — Xcw motives — Proper pi-inoiples. XIII. Extended Colonization a Xecessity for the Mother Country ........ 2G7 Population of United Kingdom — Production of Fond — Probability of lesser demands — Sources from which defi- ciency met — Extensive emigration necessary — Facilities ami advantages — Wherein lies source of wealth — Value of life — Relationship of mother country to dependencies — EHurts to meet necessity — Home-residents and colonies — Public opinion. XIV. DiuNKiNG and Depression ...... 301 Probable privation during ensuing winter — Retrench- ment necessary — Should begin with drink — Depression enhanced by expenditure on alcohol — Increases outlay for imports — Curtailment would quicken export trade — Awakening perception to truth. XV. Ri:t EXT Revival IN Trade . . . . , .311 Originated in orders from America — Examination into exports — Increase more in quantity than price — Imports, -a CONTEXTS. PAGE decided advance in price — Conntries to which exported and iinportcd from — Imports increased beyond exports — Food at bottom of (luctuations — Revival very much owing to bad harvest. XVI. TirE Finance OF " NATiojJAr. Insurance " . . . 326 Scheme of Mr. Blackley — Financial question — Table of supposed ftind — Amount proposed insufficient — Rate of investment — Accumulation necessary — Ultimate charge on fund — Disadvantages to thrifty — Advantages to impro- vident — Fallacies on which supported — Weaknesa of scheme — Unlikely to be adopted. INTRODUCTORY.— THE PRESENT CRISIS IN TRADE. IF it savour somewhat of presumption thus to place before the public a series of papers which with a few exceptions have ah'eady appeared in the published Proceedings of various Societies, the apology to be offered is that in the opinion of friends, the accuracy of whose judgment it would be still more presumjotuous to dispute, their appearance is justified by the importance of the subjects of which they treat. These friends know that the information they con- tain has been honestly and laboriously collected, and though the conclusions which the figures are employed to support may not altogether meet with unchallenged acceptance, they think the facts are yet worthy of attention as evidence to- wards the working out of problems of the highest interest. It was at first intended to rewrite the whole of the papers, bringing down the figures compiled for the earlier to the date of the later ones, and eliminating from each whatever had been introduced into the others; so reducing the bulk of the volume, and giving greater completeness to the whole. It was, however, found that to do this would involve the preparation of a mass of new figures which would not have altered the reasoning of which they were the ba.sis, involving great labour without any corresponding advantage. On the con- trary, that though in a few instances the repetition of figures xu INTRODUCTORY. and the restating of results may be found in some degree wearisome, yet as illustrating different branches of the sub- jects, and leading up to conclusions which harmonize and support each other, the iteration is valuable for strengthening the opinions arrived at through diffci-ent channels on kindred, yet not identical topics, all converging to the same end. The papers, therefore, excepting that in some few instances later figures have been added to some of the tables, and here and there a verbal alteration has been made, are repro- duced in the same state as they first appeared. They are also ranged in chronological order rather than with reference to their subject-matter; so that wherever similar points are touched, the later paper gives contact with the latest facts. It is hoped that in their collected form these essays may not be altogether useless to those statesmen, political economists, and leaders in philanthropic movements to whom the present trading and social relations of the country, whether home or foreign, must at this time be a source of the deepest interest as well as keenest anxiety. The mention of one other reason for publication may perhaps be pardoned. It has been a source of much solace to the wi'iter during the many weary years through which he has been officially engaged in the compilation of trade statistics, to trace the information they afford backwards to its sources, and onwards to its bearings upon the progress and prosperity of the community : thus, by utilizing the labour bestowed — beyond the mere results shown in the published trade accounts — relieving the tedium of perpetually deal- ing with dry and uninteresting details. With this object he has ever sought to improve and simplify the methods for pro- curing, recording, and compiling the various accounts ; and had some share in bringing about the extensive changes of system in 1870 which form the subject of the first of the THE PRESENT CRISIS IN TRADE. xiu following papers. Since then, finding himself — whether from the accidents of official life, the results of political changes, or as the penalty of too great pertinacity in pur- suing those plans of statistical reform which then received the highest sanction and have since obtained the highest praise — in a great measure shut out from the honour and responsibility of carrying them into practice ; it has been to him no less a labour of love than of presumed duty to give the country which has paid for his services the benefit of such light, the result of long training and close observation, as it might be in his power to throw upon the various subjects with which the trade returns are so intimately connected. It must, however, be understood that, whatever the shape in which the figures are condensed or reproduced, they rest upon official sanction only in so far as they emanate from the recognized official authority, and that the author is solely responsible for the forms in which they are presented in the following pages, as well as for the opinions expressed or the deductions which to him they appear to sustain. With these explanations and in this spirit he desires to offer a few preliminary observations on the momentous trading crisis through which the country has been passing of late years, the end of which has certainly not yet arrived. The subjects treated of in the following pages may bo ranged under three heads : the progress of our Trade, the increase of our Population, and the supplies of Food which our commerce procures for our people to consume. The sequence in which they stand in the title-page of the volume indicates the order in which they claim considera- tion. A retrospect of the early history of our foreign trade will show that it arose from the same cause which induced XIV INTRODUCTORY. Solomon to scud sliips to Ophir for gold and to bring home from thence the " silver^ ivory, apes, and peacocks/' Our ancestors desired to possess some of the treasures which travellers had discovered other lands to contain, and to consume the luxuries which their own soil and climate failed to bring forth. But very early the cnterpi^se which took our discoverers abroad induced them to settle in the new- found countries, and by degrees to establish trading posts and colonies to an extent which no other nation has at- tempted, first, for the collection and transport of the articles produced by the natives, and then for themselves to culti- vate or manufacture the goods they found to be in demand at home. This required supplies for their maintenance, materials for their fisheries, farms, and factories, which could only be obtained from home, and thus, in addition to the sending out of goods in payment for those we received from thence, there was a growing export of those things which formed the capital worked by the settlers, but mostly owned at home. To this, in process of time, became added goods purchased on credit or paid for by loans, stocks, and shares furnished by capitalists at home. There was thus a continually expanding export trade, furnishing employ- ment to the growers, manufacturers, and traders at home. During this period the import trade had likewise been pro- gressing, and was maintained, first, by the demand for articles wherewith to repay those who had furnished the foreign supplies for our own use ; then in the return of interest, earnings, and profits on capital and labour bestowed both at home and abroad ; and, finally, for goods purchased by this country with the proceeds of repayments made by others. The remarkable development of this trade in both directions during the twenty years of its greatest prosperity, 1854-74, forms the subject of the second paper, that on THE PRESENT CRISIS IN TRADE. XV " The Progress of our Foreign Trade/' read in 1875 ; its predecessor, that on the " Official Trade and Navigation Statistics," having given information as to the nature of the returns from which the particulars of this progress were derived . It was then that the phenomenon alluded to by Mr. Shaw-Lefevre in the quotation on the title-page, that of the '^ Growing preponderance of Imports over Exports," was brought to view in No. III. paper of 1876 bearing that title. It will be seen however, from the concluding para- graph of the previous paper (p, 52), and still more from the notes on p. 223 that at a still earlier date (1873) the analysis to which the trade returns had been subjected, led to doubts as to whether the rapid rise in our imports was altogether compatible with the prosperity of trade, when unaccompanied by a corresponding expansion in that of our exports ; and from this arose the attempt in that paper, not so much to give the explanation of this phenomenon, which after its reading was in Mr. Shaw-Lefevrc's opinion still needed, as to state plainly the circumstances of our trade, in order that its condition might be properly investigated . This paper was the precursor of many others, from the pens of Mr. Newmarch, Mr. Giflfcn, Mr. Mundella, and Mr. Shaw- Lefevre himself, all dealing with the various points suggested to account for this remarkable change in the balance of our ti'ade. In truth, however, no satisfactory explanation has been afforded. In one quarter it was thought that tlie difference was more apparent than real, inasmuch as the values given were subject to deduction on one side, and addition on the other. This was admitted and calculated for in the paper itself, and after much discussion the degree iu which these alterations affect tlio results is not a point ou which there is much diversity of opinion; and at best it XVI INTRODUCTORY. docs not explain tlio rapid transition from one condition of trade to the other, amounting to a change of nearly £100,000,000 as between 1872 and 1877. Another opinion was, that the difference was due to the large profits on our trade, and the greatness of our income realized abroad and remitted home ; but there was no apparent reason why these sources should have so suddenly augmented, or the receipts from them liave coincided with the setting in of a period of depression. It was then argued that the rapidity of our accumulations at home forbad the supposition that our importations were excessive. Subsequent experience, however, has shown that the appraisement of our national property was set too high, and a fresh valuation would now considerably lower the estimate. Again, the condition of manufactures abroad was thought to be such as to dispel any fears that our manufacturing supremacy was in danger ; notwithstanding this, it must be admitted that progress in this direction at home has scarcely kept pace with its rapid strides abroad. Another idea put forth was, that those to whom we had lent money in our colonies and other places were paying off their debts ; but the figures proved that if this were so, payment was being made in articles of food, the consumption of which would not only cancel the debts but destroy the wealth they represented. A nearer ap- proach to a satisfactory solution may be found in the sug- gestion that the discrediting of foreign loans which took place at this period had restricted sales for export. This, however, would show that in the measure that former ex- ports had resulted from the expenditure of these loans in this country, the manufacturing interests had gained at the expense of the investing members of the community, and that the diminution of these transactions was beneficial. Yet it iu no wise accounted for the vast increase of the THE PRESENT CRISIS IN TRADE. xvil imports which, but for our necessities, ought to have les- sened with our diminished power to effect exchanges of our own produce. Nor docs the supposition that we were ceasing our investments abroad at all support tlie argument that om* continued increase in imports was advantageous. It simply shows that we were sending forth our money to purchase perishable commodities for consumption instead of for profitable investment. Neither of these views ex- plains how wo could fail to become poorer by buying more than we were selling. No. VIII., on " Excess of Im- ports," written though not published early in 1878, and No. IX., on the " Relation between Imports and Exports," late in the same year, are both of them efforts to discover some of the reasons for the existing state of things, and the principles which should guide to a right judgment re- garding them. The two Papers XI. and XV. carry on the facts necessary to a correct understanding, by analyzing the figures for the worst year of the depression, and show- ing the " Decay of our Exports " in 1879, and those which manifest a partial " Revival in Trade " up to the present time. The last paper to be mentioned in this section is No. X., " On the Silver Question," in which, besides dealing with the history of the production and prices of the precious metals, it was maintained that there had been neither such an appreciation of gold as to account for the depreciation of silver, nor such a scarcity of the superior metal as would either considerably enhance its value or impede trade transactions. The soundness of these opinions would ap- pear to be shown in the subsequent rise in prices, and the absence of the anticipated drain of gold for the expansion of the circulation in other places. When that drain does take place it mil occur, not because gold ia wanted for use in xviil INTRODUCTORY. America or clsowhcro, but bccauao other means of settling balances have become exhausted. On all these points there is room for much divergence of opinion, but the facta remain unaltered: that this prepon- derance of imports still exists, that though for the few intervening years the balance was reduced, it never before reached so high as it has done during the past year, and that as shown by the most recent returns — those issued whilst these sheets are passing through the press — its dimensions are still increasing. Neither is there any room for questioning — whatever may bo inferred from it as to the prosperity or adversity of trade or manufactures — that the cause of this continuous balance exists in '^ The Increasing Dependence upon Foreign Sup- plies for Food," the details of which are put forward in Paper No. IV., compiled early in 1877. Whilst manifesting that these had been trebled since 1857, it yet fails to show the still higher totals which have since been reached. In a subsequent paper, No. V., on " the Nature and Extent of our Food Supplies, and the sources from whence they are derived,'^ information will be found which may serve as material for guiding to some conclusions as to the bearing of these facts on the welfare of the nation. Other papers contain figures also which may aid in the same direc- tion. The second division under which a portion of these papers may be classed is that which relates to Population. Just as our trade in its origin and growth has widely differed from that of other nations, so have there been peculiar conditions under which the inhabitants of the United Kingdom have progressed to their present numbers and social positions. In China and India we have examples of nations existing for ages in much the same condition, cultivating the land as THE PRESENT CKISIS IX TRADE. xix their forefathers had done, trading more between them solves than with foreigners, but constrained by the pressure of in- creasing numbers to seek commercial intercourse with other countries — principally with England — and thus sharing in the benefits of Western civilization, enabling them to ex- change tlio products of their industry in the shape of raw material and food for the finished articles sent from our own and other shores. In the United States wo have an example of a different kind : a comparatively new people, occupying lands of great richness in agricultural and mineral products, increasing with great rapidity, by natural addi- tions, consequent upon freedom of space and abundance of food, aided by the attractive influence of the same causes bringing immigrants from the older countries; employing itself mainly in agriculture, and so obtaining manufactured articles from abroad, mainly from the Mother country, although now endeavouring to rival her in both manufacture and trade. The same may be said with a great degree of truth of our own Australian and African colonics, who, liko the United States, in becoming peopled have not only sus- tained themselves upon the food resources of their own lands, but have been able to produce large quantities both of this and of raw material for transport to the old world — again up to very recent times chiefly to this country. The soil has created the population, and with it tho means of subsistence. Here, however, we for many years past, though rapidly adding to our numbers, have ceased to grow more of food or clothing, and thus are yearly becoming moro de- pendent upon our manufacturing and trading operations for obtaining the necessaries of life. It is the trade which has created our population, and that in three ways — tho natural increase which it fostered, the restraint it put upon emigration, and tho immigration of those who found better XX INTRODUCTORY. employment here than in tlie places of their birth. On the maintenance and the rapid enlargement of that trade we depend for the life and the increase of our people. Hence the depression and suffering resulting from the lessening or decay of our exports, and the grave anxiety with which the present state of affairs must be regarded. In Paper No. VI., " On the Growth of Population," &c., 1877, it was sought to be shown that up to the date when that paper was written there had been no increase out- stripping the means of subsistence produced at home or procurable from abroad in exchange for our manufactures. In No. XII., "The Social Aspect of Trade Depression^' as the status of the several members were affected by it was set forth, whilst in No. XIII. the necessity for extended colo- nization as a consequence of that depression was contended for ; and in No. XVI., on the " Finance of National In- surance," the practicability of the proposed measures for the prevention of pauperism was investigated from a finan- cial point of view. The objections to which this scheme lies open on the ground of expediency, as well as for social, moral, and even religious reasons, are numerous. There was not space for dealing with these, which may form the subject of future consideration should the National Club still be a candidate for public acceptance. The third subject dealt with in these papers is that of Food, which besides having the two already alluded to de- voted entirely to it, finds a place or places in almost every one of them; for the necessity of obtaining supplies of food forms so important a consideration in every trade question that scarcely any can be separated from it. To our trade we owe the increase of our population, and to the extent of that increase we owe the necessity for trading in food. It is thus the first, the last, and the all-imjjortant subject on THE PRESENT CRISIS IN TRADE. XXI which hinges the continuance or advance of our national prosperity, for herein we differ from almost every other nation, and it is the end and aim of trade to remove the existing consequences of that difference. We cannot avoid supplementing our deficient home supplies by drawing upon the superfluous growth of other countries ; we must neces- sarily work for the production of something wherewith to pay for those supplies, and we have no means of carrying on the exchange but through the medium of the trading rela- tions we establish or maintain with the rest of the world. Closely connected with this are the facts spoken of in paper No. XIV., on " Drinking and Depression," which deals with the waste of money expended on alcohol, and the degree in which this affects wages, and through wages the enhanced cost of our manufactures, thus heavily weighting our com- merce with the world. Paper No. VII., though relating solely to an article which can only be classed with food, more properly belongs to the first group, that of trade, since on the adoption of some satisfactory settlement of this matter much of our trade, with France especially, depends. Yet it is impossible not to see that if we would dispense with the consumption of tliat article we might save for devotion to other uses all the labour expended in producing the goods we have to sell or exchange for wine. It will be noticed how closely the principles, on which three years since it was suggested that legislation should be based, are in confor- mity with those proposed by Mr. Gladstone in his recent Budget, but withdrawn to await an agreement with the French Government. Paper No. XIII., on Colonization, enters more fully into the extent of our home supplies, and from their proved deficiency points to the necessity for many of our people to go forth and become food-producers for themselves and for those who remain at home, in some oral! h 2 xxn INTRODUCTORY. of the magnificent territories which form a part of the British Empire. The needed explanation, then, of the phenomenon mani- fested in the growing expansion of our imports beyond that of our exports is simply this, — that with a prosperous stato of trade and manufactures, the mouths we have to feed, and the food required to feed them, have increased beyond the powers of our own soil to provide for; and that other nations have been growing in intelligence, wealth, and manu- facturing power, and so in the capacity for supplpng their own wants, without increasing, but rather decreasing, their demands upon those products of our labour by which our ability to purchase food from them is largely maintained. Our necessities have been multiplied by continuous seasons of diminished produce from our own soil, whilst agricultural operations have been progressively advancing abroad ; thus, concurrently with lessened crops, there has been a lower range of prices to remunerate our own agriculturists, and they have had less to expend with the manufacturers for the home trade. That we should have been able thus long to stem these adverse currents does, indeed, manifest the pro- gress of our resources, and the accumulations of our past prosperity in trade ; but it does not at all indicate that we may not now be expending more than our income, or at least ceasing to make those accumulations which have con- tributed to our wealth and given us the commercial stand- ing which we still retain. Neither does it forbid the sup- position that if that wealth and that supremacy in trade and manufacture is to be preserved, we must retrace our footsteps, in some directions, and advance vdth greater boldness and rapidity in others. One feature in the present aspect of affairs appears to have been lost sight of, or not, at least, suflficiently appre- THE PRESENT CRISIS IN TRADE. xxui ciated — namely, the extent to which the wealth — not only the floating but the realized capital we have — may be held as bankers rather than owners, and how large a portion of our trade wo carry on as agents rather than principals, earning commissions instead of realizing profits. It may bo that during the years of depression through which we have been passing, this has been the most profitable position to occupy, for there seems to be a growing tendency towards in- creasing the rewards of the distributor rather than those of the producer. All the experience we gain from an insight into the methods by which fortunes have been accumulated by individuals, or dividends earned for share- holders in banks, shows that boldness in speculation by the one, and the almost unlimited expansion of credit in the other, have been the sources of success. It is amazing to see how vast a superstructure credit builds upon a slender basis ; how little of actual available capital serves to carry on the most gigantic undertakings. It is thus that money held simply in custody, often enables its holder to obtain and expend so large an income. It may he that thus we have been enabled to tide over times in which we have certainly been spending more than we have been earning, and fortunate will it be for us if we thus sustain our com- mercial pre-eminence, until we can take the new departure — to use a nautical phrase — which the altered conditions under which the voyage must be pursued renders an absolute necessity. What then are the steps we must retrace ? Clearly those of individual and national extravagance, of deterioration in the quality of our manufactures, and the honesty of our trade — of undue exaltation of wealth, and dependence upon skill or smartness in obtaining the larger share of that which already exists, rather than upon industry and perseverance XXIV INTRODUCTORY. in creating and preserving, not money alone, but all that really adds to the wealth of the world. What, too, are those in which we must advance ? Aa individuals we must attach more value to honest labour, whether of the hands or the brains, employed in actual production, or the improved use and lessened destruction of that which labour has already created ; and must use the hours reserved from laborious occupation as opportunities for real recreation, not for in- dulgence in enervating pleasures or exhausting pursuits. As citizens we need to set a higher value upon the powers of life, by sanitary improvements to lessen mortality, by hygienic measures to improve and strengthen the health of the populace, and by police regulations to repress, so far as these can possibly do, all interference with that which wastes time or substance. As producers and manufacturers we need to study and practise whatever may lessen the cost of production and increase the power of labour; to culti- vate those branches in which we have a natural or sure superiority over other nations, and cease to increase those in which it is certain that other countries must ultimately excel ourselves. As traders we need to lessen the cost of distribution, to discourage costly rivalry, to increase facilities of transport, and to seek out new openings for the sale of our goods and the bringing home new articles of utility, whether as food or for manufacture. As labourers we should cease from ruinous strikes and aU interference with the devotion of time, strength, and talent, wherever and for how- ever long they may be profitably employed. As capitalists we must cultivate those close and cordial relations with labour through which alone money can be made to increase ; eschew all those speculations which merely seek to trans- fer it from one pocket to another, and even risk it wher- ever at home or abroad it may help honest labour to increase THE PRESENT CRISIS IN TRADE. XXV production. As statesmen we must economize the national resources, and, so for as is compatible with the detection of crime or the prevention of pauperism, the spread of educa- tion and the preservation of healthy life, remove every re- striction upon individual liberty. We must so regulate our intercourse with other nations as to avoid expenditure in war or the destruction of the life and property of those who by peaceful measures might be made our customers and friends. As disciples and teachers of Economic science, we must seek for the more universal diffusion of those principles of action which in our individual case or national experience have been proved to encourage labour and enhance capital in harmonious union. We must repudiate any attempt to revert to the policy of protection, or the imposition of reci- procal restrictions upon the fullest freedom in the inter- change of commodities, in the utmost confidence that what- ever of real utility is best produced or manufactured in any one part of the world, it is the best that every country should obtain at the lowest cost and in the readiest manner. We must seek to have all fiscal regulations so applied as to afford the greatest freedom in the handling, storing, and dealing with all dutiable goods which may be consistent with the safety of th« . revenue, so long as the exigencies of the State render the continuance of Customs or Excise duties absolutely indispensable. It will be said, however, that all these are truths well known and generally approved. They recommend no specific measures, suggest no new courses of action. Is it not the fact, however, that in these days we are in danger of forgetting that it is just in proportion as we have put them into practice we have prospered in times past, and that because through their imperfect recognition on the one side, and their undue exaltation, as the means of rectifying every xxvi INTRODUCTORY. natural or acquired disadvantage which wo find ourselves un- able wholly to overcome, on the other, there is a growing dis- position on the part of many to revert to a selfish and exclusive policy ? This may only retard the progress of a young and mainly agricultural country like the United States, but would inevitably result in the speedy decay of an old covmtry like ours, whose prosperity has hitherto resulted from the advance of its trade with the whole world. It is painful to have to repeat the truths which should be accepted as axioms, to refute those fallacies which were thought to be exploded- but so long as there remains any considerable body of states- men or economists who cling to protection or would restrict freedom of trade, the compilation of statistics and the re- stating of the facts they substantiate can scarcely be deemed a work of supererogation. It is often unjustly charged on those who dwell upon the admitted excess of imports, that they take unnecessarily gloomy views of the trading condition of the country — at least it was so charged when first the fact was brought to notice in 1873 ^ — but it can scarcely now be said that any unfavourable anticipations then entertained were worse than the experience of the intervening seven years ; nor that the present state of our trade is so satisfactory or encouraging as to support the roseate hues in which their opponents represented this preponderance of imports as our unalloyed gain. It is unfortunate for those ardent free-traders who yet doubted the soundness of all the trade which was then being carried on, and who foresaw the adversity which has since existed, that the facts they adduced have been perverted to the support of Protectionist theories ; but this would have been less the case had there been any dis- position on the part of those who believed in the con- ^ Pace 223. THE PRESENT CRISIS IN TRADE. xxvii tinuancG of unexampled prosperity, to admit that there was any cause for anxiety. The fact remains undisputed that the disparity between the two continues to exist, and that the years through which it has lasted have not been marked by a prosperous progress. Even now, whilst these words are being written, the trade returns which are being pub- lished show the increase of an adverse balance, and that tho food imports very nearly swallow up the whole value of the produce and manufactures we export. Yet we do not hear that traders or manufacturers are reaping large profits, that labourers are able to command exorbit-int wages, or that there is any plethora of work for those who are seekin"" employment, such as would naturally result were we truly advancing in wealth in the measure that tho goods we receive from abroad exceed those that we are able to sell for export. Still there is no reason to doubt the strength of our natural position, or that there are abundant means for tlio comfort and happiness of all, and many more than, tho present members of the Empire, if only we will discard our sense of false security, forsake the vices prosperity has engendered, and learn to practise the virtues which are taught by adversity. There may not be room within these islands for all who would like to remain at home, or for the employment of all the labour and capital which may bo redeemed from unprofitable uses; but there is ample scope for all of tho present and many successive generations in manufacturing for the yet uncivilized nations of tho world, and developing tho producing powers of tho uninhabited portions of our own Empire. I. The Official Trade and Navigation Statistics.' p I ^HE following paper was prepared soon after the exten- X sive alterations in the methods and arrangements for compiling the statistical returns which took place in the year 1871. It was drawn up and promulgated, not without advice from competent authority that it was expedient to make the public acquainted with the changes which had then ]>een made; and although the system then introduced has now become thoroughly establislied, it is perhaps more than ever necessary to detail its character, so that those who compare the accounts of one period with another may be made aware of the points in which the comparisons need correction. In subsequent papers the degree in which these changes, affect tlie information collected from the published returns is more fully pointed out ; and if these several alterations are borne in mind, they will serve to correct many erroneous deduc- tions from figures which are not so fully in concord as they would have been had one uniform plan been in use from the earliest to the latest period.] It was my intention, in the paper I have the honour of laying l^cfore you this evening, to have grouped the several articles of import and export, as shown in the trade returns for the past year, into distinctive classes — according to the use for Avhicli they are, brought hero, or the purposes to which ihoy are to be ajiplicd — and to have instituted a com- ' llfiul l)L'luiT the Statistical Society, 21st May, 187-2. Vol. xxxv. B 2 THE OFFICIAL TRADE parison between the quantities thus shown and those of one or more former years similarly classified. The classification proposed for the imports would have embraced the distinc- tive headings of articles of food and personal consumption, of fuel and lighting, of clothing and habitation, of works of art and the gratification of taste and amusement, of raw materials for manufacture, of those for agricultural opera- tions, and any others which might appear of a sufficiently distinctive character to be worthy of forming a separate class. The years chosen for comparison with 1871, would have been 1861 and 1851, and possibly another decennial period ; selecting those in which the census was taken, as being convenient periods for considering the figures so ob- tained in connection with the growth of our home popula- tion, and thus showing our increasing dependence upon the supplies we obtain from abroad. We should thus have seen the extent and the several degrees in which our comfort and happiness — if not our very existence — depend upon the maintenance and growth of our commercial relations, and have had, as I venture to think, a more distinct view of the wide-spread benefits of the unrestricted intercourse we are enabled to carry on with every producing and manufacturing country throughout the world. In like manner, by a similar classification of our exports, but varied in accordance with their character and origin, rather than with their appropria- tion by those to whom we send them, a comprehensive view might have been presented of the various commodities which enable us to pay for the goods we import, whilst at the same time furnishing employment to so large a portion of our in- dustrial population, and adding so greatly to our stores of material wealth. A further statement of the articles drawn hither, simply as to a depot, from which other countries may obtain their supplies, would have shown how large a propor- tion of our foreign trade results from the facility with which its operations are here carried on — the consequence of our wealth, our intelligence, our industry, and the undisturbed peace we have so long enjoyed. AND NAVIGATION STATISTICS. O In the process of this investigation I should have had to take into account the extensive alterations which have re- cently been made in the substance and form of our statistical returns, whereby the comparison between different periods is much disturbed and often rendered difficult. This would have led rao to notice the nature and extent of those changes, to have reviewed the history of our statistical pro- gress, and to have given some consideration to the character and scope of our present arrangements for collecting, re- cording, and publishing the information obtained through their instrumentality. In pursuing this plan, I should have had to derive my facts from the various tables compiled for public use, and though in dealing with them I might have had some advantage from having through many years of official engagement become conversant with their details and uses, the conclusions to which I might have been led would have been entirely of personal authority, and have been in no way invested with official sanction. In like manner, for any opinions I may now express or inferences I may draw — myself, and myself alone, must be hold respon- sible. Having, however, proceeded some distance in the path thus marked out, I became aware of two serious diffi- culties which stood in the way of a satisfactory completion of the task on the present occasion. In the first place, an unlooked-for delay in the compilation of the annual state- ment, which it was fully expected would have been in the printer's hands at the termination of last quarter, prevented the necessary figures from beiug available. Had the read- ing of this paper taken place earlier in the session it might have been well to have dealt with the figures for 1871, pub- lished in the December monthly account, imperfect and insufficient as they might be ; but since those of the revised and perfected annual accounts are so near being ready, it seemed a pity to em]iloy any considerable amount of time or labour upon those which are subject to con*ection ; and still moi*e undesirable to place on record quantities or calcu- lations which would, though even in minor particulars, 4 THE OFFICIAL TRADE differ from the final results of the yearns transactions. And in the second placo^my object being to put before you such a statement of the principles upon which our collection of statistics rests, of the sources from whence they are derived, of the manner in which they are dealt with, and the results which these labours produce, as may in some measure explain their value and aid in their employment, I found it impossible to compress these remarks within less space than is afforded by the limited time that I am privileged to ask your attention. I am, therefore, most reluctantly compelled to fail for the present in the first part of my self- allotted task, and to seek your indulgence for confining myself to such observations as it may be in my power to ofier upon the latter portion of the subject. Should I in so doing over- step the line which separates matters of public or special interest from those of purely ofiicial importance, you will, I trust, make allowance for the difiiculty of getting out of the groove in which the thoughts of an official are so apt to traverse. If, again, I may seem to enter upon details which are of too trivial a nature to warrant being brought under your notice, I would ask you to bear in mind that the integrity of the accounts depends upon the care which is taken to secure accuracy in the original rendering of small particulars; and seeing to what an extent the official depart- ment must be dependent upon the public interest in the attainment of this object, I would hope to enlist your sym- pathy with such an end, and to provoke your individual and collective influence towards its attainment. It must be quite needless to enlarge upon the advantage to a great commer- cial country like ours, of having all the information which can serve to illustrate the progress of its commerce collected together; neither can it be requisite to dilate upon the necessity that such information should be as full and accurate as it is possible to make it; but it may not be unimportant to familiarize the minds of those who furnish the materials for, and those who make use of, the publications of this kind, with some of the processes by which they are prepared, and AND NAVIGATION STATISTICS. ' 5 the means by wLicli their completeness and truthfulness may be secured. I. — Methods Adopted for Cofleding Statistics. The earliest attempt to obtain anything like a systematic collection of authentic commercial statistics, would seem to have taken place inthe year 1G97, when theoffice of Inspector- General of Imports and Exports was established on a system, by which ''provision was made that an account should be kept of the trade carried on by England with each foreign country and each of the British settlements and possessions abroad, showing the goods imported and exported, methodi- cally enumerated and classified ; their quantities by weight, tale, or measure ; and their equivalent in money, computed at certain official rates of valuation then first assigned." The necessary information was obtained and condensed by tabulation into prescribed forms at the several ports through- out the kingdom, and being transmitted to this office by the different collectors of customs, was then collected into the required records. From these, as occasion offered, extracts were made and collections formed in obedience to requisi- tions from the proper authorities; or periodically presented to Parliament and issued to the public by the Board of Trade. In later years it was found that the Examiner's — an office originally created to exercise a check upon the correct receipt of the revenue — could conveniently collect the statis- tics for the port of London, by a system which computed the duties due upon each article of import in the process of biinging them together for the use of the Inspector-General. In 1849 this plan was extended to the out-ports, which, in- stead of framing accounts each for itself, transmitted to the Examiner duplicates of the original entries passed by the importers. Thus his books of record contained the particu- lars for the whole kingdom, and it became his duty to for- ward the whole of the periodical accounts to the Inspector- General, by whom they were again transcribed into tbo 6 THE OFFICIAL TRADE various appointed forms and books. This concentration of the preliminary work under one head was a decided step in the right direction. It ensured greater uniformity in deal- ing with all matters of detail, lessened the time employed in its performance, and considerably diminished the expense. But there still remained the three offices — Examiner's, In- spector-General's, and Board of Trade, all engaged in the same duty. It became apparent that " to arrest the work at a certain stage of advancement in one office, for the pur- pose of committing its completion to an entirely different set of workmen, involved a considerable sacrifice of both time and strength, for which no corresponding advantage was gained,'' and " that the union of the two Customs' depart- ments would permit an earlier rendering of the periodical returns, and result in a marked advancement of the service in efficiency and economy." Yet it was not till 1870 that effect was given to the recommendations made so far back as 1857. Towards the close of the latter year, directions were given for the fvision of these two offices into one ; that of Inspector-General of Imports and Exports as well as that of Examiner ceased to have an independent existence, and the new " Statistical Department " undertook the whole duty ; the Board of Trade ceasing to have any share in the pro- duction of the accounts, but retaining its control over their nature and form. This change, so long anticipated and laboured for, has, notwithstanding the temporary confusion incidental to a period of transition, been attended with marked success, and gives promise of still greater satisfaction in its further progress. This office having thus become the depository for all the information bearing upon commercial statistics, which it is in the power of the customs' officers to collect; it is evident that its work will resolve itself into the three branches of recording facts, compiling accounts, and publishing returns; and that, though these duties are primarily undertaken for the service of the Government, they are intended ultimately for the benefit of the public, and must, therefore, be so shaped AND NAVIGATION STATISTICS. 7 as to meet the wants of those for whom they are performed. It may not be without interest to trace tlio successive pro- cesses by which this is effected, and, in so doing, to take first those which relate to the importation of foreign and colonial goods. II. — Imports. 1. Sources of Information. There are three sources from which information regarding these can bo obtained : the report by the master of the vessel of the cargo she brings; the entry by each importer of the precise portion of that cargo which belongs to himself; and the accounts given by the officer who superintends the vessel's discharge. Powers are confei-red by Act of Parlia- ment upon the Board of Customs, to require from the first two of these, such statements as may answer the desired end ; the third, being its own servant, is necessarily amenable to such orders as it may issue. The master of every vessel is bound within twenty-four hours of his arrival, and before breaking bulk, to report to the Collector of Customs for the port at which he may arrive, the place from whence he comes, with the number and description of all the packages or parcels of goods comprised in his cargo. Then the importer or owner is bound, before he can obtain permission to have his goods landed, to make an entry setting forth the ship in which, and the country from which brought, the number of his packages, and description of his goods, with their quantity by weight, tale, or measurement, as well as their value. In the comparison of those two statements we have the means of discovering whether one or both have duly brought to the knowledge of the authorities the fact of such importation, pecuniary penalties being attaclied to negligence or inaccuracy in these respects. Tho master has a general knowledge of the nature of the goods he is bringing, but of their precise description or quantity, aud still less of their value, he can have no means of forming a correct opinion. These particulars, however, must bo 8 THE OFFICIAL TRADE (moro or less) known to the parties to whom they are con- signed, and this knowledge tho Crown demands that they shall impart to its officers, not from any inquisitorial desire to know the secrets of each individuals trade, but for the security of tho revenue, and the acquisition of statistical information from those best qualified to afford it. The importer's entries are of three kinds, first, those in which the goods being liable to import duty, ho tenders payment of the amount due upon them ; secondly, those on which duty being chargeable, he wishes to place them in bond until such time as he is ready to pay the duty, or to re-export the goods without such payment ; and thirdly, those on which no duty being due to the Crown, the goods come into his possession so soon as landed. There is also a fourth kind of entry, when the duty is paid upon goods to be taken out of the warehouse. The first and second to- gether include all the dutiable goods imported ; the first and fourth the portion of the same delivered for home con- sumption. These entries are passed in duplicate, the originals, when ' completed, becoming the warrants, by virtue of which the goods they represent are delivered from the ship or ware- house ', and the copies, technically termed bills, the founda- tion for the statistical accounts ; for which purpose they are forwarded daily from every port in the kingdom to the cen- tral office in London. Those for articles on which duty is being paid, must give correct quantities, otherwise the goods are detained until the error is rectified. They have for man}'" years past been recorded daily in the office registers; but those on which no duty is taken, have not, till since the general revision of last year, been so dealt with ; the records being raised from separate accounts furnished by the officers so soon after the discharge of the vessel as they can be made up. Thus two systems prevailed, goods paying duty being deemed an importation or delivery of the day on which the entry was passed ; whilst others only dated from the com- pletion of the lauding account, often weeks or months after AND NAVIGATION STATISTICS. V their actual arrival ; and the weekly or monthly return which ought to have shown the full imports for the period, really only included those which were finally examined, and tho accounts respecting them made up. This has now been altered, and since the commencement of last year every entry is recorded at once. It therefore becomes of impor- tance that the particulars they contain should be correctly given, and means taken to detect and rectify any errors which may creep in. This being done, it only remains for the department faithfully to perform its functions, and correct statistics must be the result. 2. Particulars required. The points on which it is essential that accurate state- ments should be made in these entries are four, relating, first, to the country froui which tho goods are brought ; secondly, tho description of each article ; thirdly, its quantity ; and, lastly, its value. A. Country of Origin. For the guidance of the officers and all persons concernedin the passing of entries, there is issued an authorized " List of countries and di\asions of countries as they are henceforward to be distinguished on the statistical records of the com- merce and navigation of the United Kingdom." This list formerly enumerated I 78 countries or parts of countries, mauy of them being subdivided according to certain arbi- trary boundaries, as, for instance, France and Spain, as within and -without the Mediterranean ; the United States, whether north or south. Many of these distinctions it was found impossible satisfactorily to maintain, and others ap- peared to bo useless. They were, therefore, swept away, and a now list issued with only I I 2 distinct headings. Tho result of this condensation will be tliat certain countries, which have hitherto been sjiccified, will no longer have a separate place, but be included with others in larger divi- 10 THE OFFICIAL TRADE sions. Thus the West Indies are now divided solely accord- ing to nationality ; all those belonging to Great Britain are included together, and the trade of Jamaica, Barbadocs, &c., will be found merged with the smaller islands under British West Indies. The presidencies of India and the divisions of Australia are still separately retained. A complicated question, however, here arises, as to the way in which goods passing through other countries in tran- sit to or from this should be dealt with ; whether as imports or exports from or to the original country, or from that to which they are shipped to this country or landed abroad. A ship takes goods from London to Portland in America, to be thence forwarded to Quebec; shall these be deemed as ex- ported to the States or to Canada? Another brings goods from Boulogne, which have been brought by rail from Marseilles, which place they reached, from Naples. Are these to be impor- tations from France or Italy ? In former times, when railway transit and forwarding companies were unknown, a very simple rule sufficed ; goods taken on board at any port were deemed to be an importation from that port ; and goods sent to any place were deemed, to be exported to the port at which the ship in which they were sent was to unload her cargo. An adhe- rence tothisrule leads now to the most anomalous results ; very large quantities of goods are received or taken from here, on " through rates,''^ which means that the journey is performed in many stages, and with many changes of conveyance, and yet it can be of little consequence how they are carried to or from their viltimate destination or place of origin. It is often mere matter of accident by which route they are con- veyed ; yet it makes a vast difference to the trade accounts whether they are assigned to one or the other, and may de- stroy altogether the comparison of one year with the other. This will be made plain by referring to the trade with British India, or with the countries on the Pacific shores of America. Goods shipped in Calcutta, by a vessel coming round the Cape of Good Hope or through the Suez Canal, will be taken as arriving from Bengal; but should they break their voyage AND NAVIGATION STATISTICS. 11 by a railway transit across the Istlimus, and bo re-sliipped at Alexandria, they will bo entered as if from- Egypt. Again, a Liverpool company is engaged in carrying goods to and from Chili, Peru, and other countries in the Pacific, as well as to Mexico, Cuba, the West India Islands, China, Japan, &c. All those for places this side of the Isthmus of Panama are rightly assigned to their respective countries, because the Liverpool vessel receives or discharges them there ; but all which are sent across the isthmus and there delivered by the railway, or carried further by the ships of the same or an allied company, are considered as from or to Colon in New Granada, where the first vessel commences or ends her voyage. JSTor is this evil one that can be easily remedied; and, in the absence of a remedy, the old rule still prevails in some instances, and in others the simpler plan is adopted of disregai^ding the changes or breaks in conveyance, pro\aded only the journey be continuous. Until this is universally aclcnowlodgod, any attempt to ascertain the extent of our trade with such countries as have indirect as well as direct channels for the passage of their goods, or to compare the results of different years, must be utterly fallacious. In all cases the parties entering their goods at the Custom houses here, must know from whence they are receiving or whither they arc sending them, and it is quite as easy, indeed more so, to declare the final rather than the intermediate port. The only principle upon which it is safe to act, seems to be that of considering tho terminal points in the journey the goods jierform, as those of departure and arrival. [The principle here contended for is now adopted, and since it is tho practice to carry all imports to the country of origin, and exports to that of ultimate destination, so far as these are known, and are disclosed in the documents prepared by the traders. It is probable, however, that some of thcso escape being so noticed, and hence that the trade conducted with countries reached by circuitous routes and inland com- munication fails to be fully shown, whilst that with countries having transit ports, is, to some extent, unduly magnified.] 12 THE OFFICIAL TRADE Yet this will fail to bo precise when they change hands be- tween these points, and is at best insufficient to deal with those which are re-packed or arranged for further transit. Jamaica at one time owed its commercial importance to being the depot for goods afterwards sold to the traders with South America. St. Thomas and Nassau are still places of con- siderable trade, but of small consumption. There are some countries, such as Switzerland (from her having no ports) , with which we appear to have no trade ; and many, Austria for instance, which show but little, because the greater part passes through others ; although our relations with both these may in reality be as direct as it is in cases where it is more clearly manifest. It is very desirable that attention should be directed to all these points, as showing that many of the results at which we arrive cannot be taken without some limitation, and also for the purpose of eliciting opinions which may aid in the acquisition of perfectly accu- rate statistical knowledge. B. Descriptions of Goods. The next essential point is that which determines the precise description of the articles imported. This, like the country of origin, is regulated by a " List of articles of mer- chandise, imported into the United Kingdom, showing the designations by which they are to be distinguished," enume- rating 389 distinct articles, and having an appendix for " certain articles which are not specifically enumerated in the import list, showing the revised denominations under which they are to be distinguished in the entries,^^ in which 417 other articles are mentioned. The lists under which the articles were kept in the accounts prior to last year were ex- tended to 886 heads, embracing numerous subdivisions now omitted, because it had been found that the attempt to keep them up only tended to produce errors. In the case of articles of large import and distinctive character, there is no difficulty in determining to what denomination they belong. AND NAVIGATION STATISTICS. 13 Wheat, cotton, tea, wine, at once assume their proper posi- tion, but with many articles, manufactured ones especially, the class in which they should be placed is very doubtful. A clock, for instance, would seem to be a clear title under which to include every description, but in many of those imported, the timepiece is the least valuable part ; for the case and stand may be works of art, of metal, porcelain, wood, or other material, and would then properly fall under one of these heads. The list at present in use has been prepared with much care, with a desire to give a distinct place to every article of commercial importance, and to ex- clude those of limited or unfrequcnt importation ; yet many are excluded or grouped together, which the importers or producers of the article would wish to see specially distin- guished. It is to bo feared that in the condensation which has taken place, information which for many reasons would be very valuabje has ceased to be noted. Those who con- sult these accounts from time to time discover omissions which they regret, and endeavour to have them repaired ; but there is this great difficulty, that any alteration not only increases labour, but destroys comparison with the accounts already published under a different regulation. c. Quantities. The third point has reference to the quantities of the article. With those that are liable to duty there is not so much difficulty, since sooner or later they will be weighed or measured for the assessment of duty ; but for those which yield no revenue this would be impracticable. Besides the expense, it would involve such a delay in dealing with the goods as to seriously impede the operations of trade ; and in very many cases goods are so packed as to make it trouble- some and destructive to ascertain the contents of the pack- ages in which they are contained. Until recently, the im- porter's entry for free goods, although stating the number, weight, or measurement, as the case might be, was not 14 THE OFFICIAL TRADE taken as correct until endorsed by an officer who, without actually examining the goods, exercised such a supervision over their landing as would, it was thought, enable him to detect any serious error. With dutiable goods goinginto bond, no weight, &c,, at all was stated by the importer, and none could therefore be taken to account until the necessary exa- mination of the goods discovered the exact quantity. It was proposed many years ago, that the importers should render an account of the contents of their several packages, but a fear lest they should not be able to do so with sufficient accuracy prevented this plan being adopted until recently. The extreme importance, however, of obtaining information on this point at an early period, and the consideration that in dealing with large numbers of entries, minor errors would balance each other so as to leave the ultimate results sub- stantially accurate, induced a change of system. Now the first records are made from the importer's entries. Most articles are brought here in packages of certain recognized sizes, the usual weight or measurement of which become known to those through whose hands they pass, and even in the absence of any invoice or other statement, the exercise of ordinary care in computing the quantity a number of pack- ages will contain, is certain to give a very near approach to accuracy. As before stated, in the case of goods liable to duty on consumption in the United Kingdom, it becomes necessary for revenue purposes to ascertain the exact quantities, and therefore the statement in the entry is only provisional. It may and does serve a temporary purpose, but the permanent records are corrected so soon as the landing accounts are made up. The same means of correction do not exist with respect to goods that are free of duty. These are subjected only to a cursory inspection by the examining officers, who are directed to satisfy themselves by examination of the goods or the wharfinger's landing accounts, that the variation is not excessive. If the error be beyond lO per cent., either more or less, a coiTection is made, but those of a lesser AND NAVIGATION STATISTICS. 15 degree are tLought to balance each other, on the principle that where the basis on which the calculation rests is sound, the average result may bo safely taken. Given the usual weight of a cask of tallow, or the contents of a pipe of wine, and it is very improbable that the sum of a thousand esti- mates will be very far from the truth. D. Values. There remains then but one point in which the accuracy of the statistics depends upon that of the information derived from the importer's entry, namely, the value, and this is one of great difficulty, the results hithei'to obtained being far less satisfactory than they have been in other respects. So far as regards any particular ai'ticle, and comparison in it of one year with another, quantity is a far better test than value, the one being a fixed, the other a fluctuating stan- dard ; but for the purpose of bringing together the various articles which each country sends us, or of ascertaining tho extent of our trade WTth the whole world, no other means exists but the reducing of all to one common equivalent. The asking of these values from the importer is quite an innovation on previous methods of acquiring this knowledge. Previous to 1871, the real values of all articles that could bo entered either by tale, weight, or measurement, was com- puted, not declared ; the basis of computation being ob- tained from special lists of prices furnished by appointed agents, an examination of the ordinary prices current, and any other available source which could guide the judgment of those by whom they wore estimated. This system had the defect that it could take but little account of tho special qualities of tlio parcels of goods at any time imported, but only the average market pi*icc of each month, excepting in so far as the agent employed had knowledge of tho class of goods then coming forward. For some articles, tin's ave- rage was very accurately ascertained ; of these, tea may bo cited as an example, but then almost all of it is brought to 16 THE OFFICIAL TRADE tho port of London, and is there disposed of by public sale, or through tho instrumentality of a few brokers to whom tho actual quality of each month's arrival is well known. But in others, say wine, the quality, and therefore the value, could scarcely bo ascertained; yet even in it a tolerably correct average could be struck by those who had the oppor- tunity of consulting the various importers. The present system has great disadvantages, arising from the want of knowledge on the part of the importers, the indifference of many who pass the entries, and the impossibility of the de- partment exercising a valid check. It is well known that a very large proportion of the goods sent to this country are on consignment, and not on purchase, in which case there is no invoice or statement of prices. In these cases tho consignee is very much in ignorance of their quality or price,and therefore unabletofix a proper valueuntil they have been examined and sampled. Where, again, as is very fre- quently done, the entry is made by a mere agent, who may gather the description of the goods from the ship's report, and estimate the weight from the nature of the packages ; there is no guide at all to the value. In other instances there is great indisposition to let the true value be known. Supposing, as is constantly the case, wine to be brought from Hamburg in casks, branded with the mark of the best Spanish vintages, it is very improbable that, however vile the stuff may be, it will be valued at less than the price of good sherry. The greatest vigilance, therefore, is necessary to guard against the most erroneous values, but the department can only interfere in extreme cases, for it is unable to discover or question any but very extravagant departures from the average. The law has given it the power of calling for in- voices or other proof, which is frequently done, and fines are often inflicted for wilful or careless departures from the truth. The only real security, however, is in exciting an interest amongst those who have to declare the value. When once it is understood that these and other particulars are of real importance, there is, in importers generally, too much AND NAVIGATION STATISTICS. 17 good feeling and desire to do what is right, to permit of other than the best information it is in their power to give being placed at the disposal of the authorities. There seems, however, no way of providing for the very numerous cases in which the consignee is ignorant of the value, pr the agent who puts in the entry is without instructions to guide him. At present, the change of system produces, in many articles of import, an apparently great divergence between the values of this and former years. Had the old plan, as was done in 1851, been maintained for one or two years, in conjunction with the new, it would have served as a basis of comparison, and have shown whether the present method is of sufficient accuracy to compensate for the labour and cost its adoption entails. In the earlier stages of the system established on the formation of the Inspector-GeneraVs office, the value was taken from fixed official rates, founded on the ascertained prices which all known articles bore in the year lG9i ; with the addition of such new articles as afterwards sprung up, at the prices they each bore in the first year of their introduc- tion. These values remained unaltered, and were used down to 1870, for the computation of the "official value'' now altogether abandoned. It was supposed that by a con- tinuous computation of the value at the same rate year after year, a comparative statement would be arrived at of the true progress of trade ; and that by applying the same price on all occasions, the total value would furnish a measure of quantity. This was strictly true as regarded the articles singly, and would also be true of them collectively, so long as the relative quantities of each bore the same proportion to that of others and to the whole. Thus France sends us both wheat and wine ; if in any one year the quantities were equal, but in another year the quantity of the one be reduced, and that of the other increased, each by one half, the "official value" of the whole, to be a measure of quantity, ought to be the same ; but inasmuch as the rate of the two articles would diiTcr, the calculated result would diflVr also. 18 THE OFFICIAL TRADE Againj tliis country is a largo impoi-tcr of agTicultural pro- duce and raw material, many articles of which, fi-om increased demand and diminished supplies, have greatly risen in value ; and is a largo exporter of manufactured goods, which, from improvements in machinery and extended em- ployment of capital, have fallen in the cost of production. Last year we imported, principally from France, 3,35 I, I o6 great hundred of eggs, valued at £1,265,484, and exported to France 87,969,530 yards of cotton, at a value of £1,688,094, leaving us creditors of that country, so far as these two articles are concerned, for nearly half a million of money. The actual value of the eggs was about 6s. per great hundred, and of cotton 4^fZ. per yard, but the "official" rates were gd. and is, 6d. respectively. Calculating the values at these, the eggs would be worth but £ 1 25,666, and the cottons £6,597,700, showing a balance in our favour of nearly six and a half millions, instead of only a half million. This is doubtless an extreme case, but some such process of change has been going on in most of the articles and countries with which we have trading relations. It is clear, therefore, that any reliance upon the " official values " could only lead to mistaken opinions and fallacious results. It was considerations of this kind that led to the substi- tution of a declared value for exports in 1798, and a com- puted value for imports in 1854, this latter being again changed last year to a declared value like that given for the exports. III. — Exports. An analogous process to that thus described for the im- ports is pursued with the exports of British produce and manufacture. The countries are kept under the same head- ings, and a similar list enumerates 2 11 articles of which a separate account is kept, in lieu of 446 which the former one contained, whilst an appendix describes the proper places to which I 20 others are to be carried. The law imposes on every AND NAVIGATION STATISTICS. 19 shipper the duty of putting in a "■ specification '^ for each, shipment, stating the vessel and country to which she is proceeding, and the number of packages, with their contents in quantity and value. This document must be filed within six days after the sailing of the vessel, by which time also her master or owner is bound to deliver a manifest setting forth the whole contents of her outward cargo. The specifi- cation and the manifest being compared together, show that every article has been properly entered, and the same provisions which secure a correct statement of the various particulars on importation also rule with exporters. These have for many years past furnished all the information pro- cured respecting British goods, and with much greater assurance that the weight and value can bo correctly given than in the case of imports ; since these particulars must in all cases be within the knowledge of those by whom the goods are shipped. It is feared, however, that with regard to both, there is less attention paid than there ought to be to full and accurate information being given; and if it seems that in these observations too much space has been given to these small matters, it has been from the conviction that it cannot be too widely known how utterly impossible it is for the department to prepare or furnish coiTCct accounts, if the materials put into its hands for that purpose are not sub- stantially accurate. There has been too much disposition to consider the passing of Customs entries as a mere formality, imposing an impediment to the prompt transaction of com- mercial business, a disagreeable duty to be got through or slurred over with the greatest ease and rapidity. In many cases, too, there is reason to think that there is an indispo- sition to make known the full particulars, from a fear that in so doing the nature of operations which it is not desirable to divulge may thereby become known to others who fire pro- bably rivals in trade. It is to be hoped, however, that a more enlightened spirit will prevail, and that in proportion as the benefits of full information on all points of trade become felt, greater care will be exercised by all with whom 20 THE OFFICIAL TRADE it rests to make tho trade accounts as perfect as possible. If what has been hero said on the subject have any effect in helping on so desirable a result, the time and attention given to it will not have been in vain. [In republishing these observations as they were written, it is necessary to express regret that they should have been unfortunately open to the construction that they were intended to throw discredit upon the method adopted, whereas the object held in view in thus pointing out the dangers which existed, and the difficulties which might arise, was to incite those by whom the original entries were prepared to greater diligence in ascertaining and furnishing the correct particulars. That much trouble did arise from this source is well known to all who transact this business ; also that, even after years of experience and exercise of the greatest care, there is room for much improvement in this respect on the part of those who appraise and declare the values of their goods.] IV. — Nature of Records and Fuhlications. If the foregoing remarks have, as it is hoped, fully ex- plained the sources from which statistical information is obtained, they will also have shown the nature of the re- cords kept in the Statistical Department. Receiving the bills each day, they are at once entered into appropriate regis- ters, which show in detail the trade carried on, both inwards and outwards, at each port in the United Kingdom ; these are ranged under Articles and Countries, and specify in each case the quantity in its appropriate denomination, and the value as declared by the parties passing the several entries. By the addition together of the several items and tabulating the totals in proper forms, every description of information within the range supplied by the first entries can be obtained at pleasure. Their stated use is to supply the periodical returns to be laid before Parliament, or pub- lished in the ^'Gazette" for public information, but they AND NAVIGATION STATISTICS. 21 arc also drawn upon to no small extent for special accounts moved for by mcmLers of Pai'liament, and supplied to tho Government, or, by its direction, to various individuals or public bodies making application for them. Records of this nature, more or less fully compiled, are in existence fj-oin the year 1696, and every successive year adds to the sum of the knowledge we possess of tho history and progress of our national industry and commerce. The magnitude of this work will appear from the number of documents which have to be dealt with. Those for goods paying duty on arrival or going into the warehouse, many of which contain more than ono article, exceed i 20,000 annually; those for free goods, 230,000; for delivery from the warehouses on payment of duty, 1,300,000 : for the ex- ports there are close on 1 00,000 for dutiable articles, many of them containing six to ten items, and for British goods more than 500,000, averaging five or six articles in each. These have to be distributed over the 135 ports in the United Kingdom, subdivided into tho 600 articles contained in tho two lists, and the 1 1 2 countries. The regular publications for which the department is re- sponsible arc, 1st, a weekly account of corn, inserted in each Tuesday's " London Gazette,'' containing a statement of all that has been imported or exported up to the preceding Saturday ; 2nd, tho Monthly returns of trade printed for the House of Commons, and issued on the 7th of each month, containing condensed accounts of the principal articles of imports and exports during the preceding montli, aud a cumulative account for so many months as have elapsed in the same year, compared with similar periods in two preceding years ; 3rd, Quarterly accounts of the value of merchandise imported, and the British produce aud manufac- tures exported to each foreign country and British posses- sion in the past quarter, and six, nine, or twelve months in each of the three years ; and, 4th, an Annual Statement of a nmch more elaborate character, which makes its appear- ance in the shape of a largo quarto volume, after the pro- 22 THE OFFICIAL TllADE ceding accounts have been subject to revision and cor- rection. A variety of tables are also published in the " Statistical Abstract for Fifteen Years/^ issued annually by the Board of Trade; and much valuable information is given in the Annual Report presented by the Commissioners of Customs. In using these accounts, it is needful to bear in mind that, for reasons to be presently explained, those for the weekly, monthly, and quarterly periods are all prepared from the importers' entries, and therefore liable to correction; but that the Annual Statement has bestowed upon it all the care which it is possible to give, and is, before publication, made as correct in all particulars as it is in the power of the office to make it. V. — Alterations in System. In the system on which these accounts are prepared, as well as in the form in which they are issued, very great alterations took place at the beginning of last year. Nume- rous complaints having been made both in Parliament and the public prints, that they were delayed so long as to be practically useless, and that they seldom agreed with the statements put forth by other parties, a Treasury committee was appointed, by whom the whole subject was thoroughly investigated, and on whose recommendation the changes took place. The delay in the production of the monthly account was found to arise from an endeavour to compile it from the landing accounts, which often take six weeks or two months in completion ; and the differences between the official and private statements, from the fact that all these landing accounts could not be got in for the proper month, and, therefore, some of them had to stand over till the fol- lowing one. In reality, the official account was not, nor did it pretend to be, an accurate one for the specific month, but only so far as the examination of the goods had been com- pleted in time for them to be included. The assumption that AND NAVIGATION STATISTICS. 23 SO much as was left out at one time would bo compensated by an equal quantity on the next occasion, proved utterly fallacious, as was thus represented to the committee: — " If this information [the landing officer's account] could in all cases be obtained prior to the preparation of the account, it would be, in every respect, the most satisfactory source from whence it could be supplied, but weeks and months often elapse before it is received. In one bundle of bills acciden- tally taken for inspection, all of which were going into the October account, only eight properly belonged to that month, whilst there were eight, eight, and ten, belonging to June, July, and September respectively. It thus happens that the monthly account, as published about the 2-jth of the succeeding month, contains only a portion of the month's imports, -with a largo remanet from the preceding month, and smaller quantities of two, three, and four months further back. The weekly account of corn is probably two or three weeks out of date. It is true the average may be correct, but so great are the fluctuations in the arrivals, that, as at present given, the accounts aflford no sort of reliable infor- mation for the specific period they profess to represent. So serious is the divergence from the truth, in the article of tea for instance, that the account would often be many millions of pounds out, but that a plan has recently been adopted of adding an estimate of the quantity arrived but not weighed, thus altogether departing from the principle of using only such landing accounts as are made up. In tobacco, wine, brandy, and sugar, it is known that the deficiencies must be quite as large, but no means exist of obtaining estimates." '' Would it not be well that these statistics should be divided into two classes ? The one possessed of transitory interest, as the guide for present commercial and financial purposes, the other of lasting value as the permanent record of tlie national trade and progress. For the one (embracing weekly and monthly accounts), early publication is essential, whilst only a proximate accuracy and fulness is required. For tlio other, that they should be strictly correct and full in detail. 24 THE OFFICIAL TRADE wliilst sufficient time may bo taken in their preparation to ensure these important requisites. What is wanted in the first case, is not a statement of such goods as are actually landed and accounted for, but of such as are really in the country, available for consumption, the subject of bargain and sale, and capable of influencing calculations as to future operations. This information the mercantile world have at present no means of obtaining, except from the circulars of the brokers or others engaged in particular branches of trade, which are only to be relied upon to the extent of the knowledge within reach of their several compilers. To give eflfect to this view it is proposed that in the first instance the importer's account of weights, &c., should be taken at once instead of waiting for the landing officer's return. That from these the records in the registers should be made, reserving an additional column or spare line in which to insert the true quantity when ascertained. These entries would be made from day to day, and at the close of the month adopted for the transitory account. So soon as accurate information can be obtained, a correct total should be made for the annual and permanent one. In this mode the one might be ready in three to five days after the month ends, instead of the 20th or 25th as at present ; and for the other we should obtain that which now we never get, a really true record of the imports of each respective month." These representa- tions and suggestions met with approval, and have been carried out since 1st January, 1871. How far the anticipa- tion of approximate accuracy for the prompt account, and of real results for the permanent one, have been realized, will appear from the following table of the weights as given by the importers' entries, and the actual quantities of the principal dutiable goods imported within the year. AND NAVIGATION STATISTICS. 25 Importers' Entries. Actual Quantities. Percentage of Error. Cocoa 17,096,729 189,977,648 1,040,619 13,984,412 1 1,086,362 171,094,275 72,231,263 16,605,774 17,132,236 191,907,045 1,024,940 14,007,514 1 1 ,232,2.S4 109,770,570 70,592,930 10,821,045 - 0*2 I - lOI + 1-53 - 4-27 - 1-30 + 077 - 570 - 1-30 Coffee Currants Siiirits SiiTiir Tea Tobacco Wine All dutiable ar-"| tides together, f 492,431,233 499,905,922 - 1-50 Theso articles are selected because, for revenue purposes, they are actually weighed or measured ; and there can be no reason for supposing that in those which are not so tested, the importers^ entries need be less correct. This change is the basis of the present system, rendering it possible to pro- duce the monthly account sufficiently early to be of material use, and making it a substantially accurate statement of the transactions of the period which it professes to represent. The other groat feature in the altered accounts, which has before been entered upon so fully, is that of substituting a declared for a computed value. There are no means of test- in54oJ35 8,579,20.3 These examples are worthy of note, because it so often happens that ignorance of the change of system leads to the quotation of figures for values prior to 1854, as if they were of cfjual worth to those from that date forward. The same difficulty does not exist with regard to the export of British goods, the declared value for them having been adopted as far back as 1798. Beiny: thus restricted in the date to which wo can 4." U 34 riiOGRESS OF OUR FOREKiN TRADE, War, which then broke out, may \)0 deemed to have affected the trade of tliat and tlie following year; h)ut not to bo great an extent, however, as might be supposed, as will appear from the official values for it, and the few preceding years wherein there is much the same sequence, as is manifested by the real values of Table I. for succeeding years. Impdrts. British Exports. 1849 £ 105,884,263 100,469,067 110,484,997 io9.33i'i58 123,099,313 124,338,478 £ 63,596,025 '50 71,367,885 '51 74,448,722 '52 78,076,854 '53 '54 98,933.781 97.184,726 There are two aspects in which the commerce of the kingdom may be viewed : the one embracing all goods im- ported and exported, including those brought to it for a market and again carried abroad; the other excluding these and showing only the foreign and colonial goods retained, and the British goods exported. The first may be deemed the merchant's view, since to him it matters not whether the goods he sells are for home or foreign use, of home or foreign production. The latter, however, is the more important view to the political economist, since the general condition of the country is evidenced and influenced by its ability on the one hand to pay for the goods it consumes, and, on the other, by its power to produce and sell the articles on which the employment of so large a portion of its population depends. The several tables ' have been drawn out with the design of clearly showing : — Several of the tables to which reference is made have not been in- serted ; and the same omission has been followed in those appertaining to subsequent papers. Their bulk would have unduly swelled the volume, aud possibly have given it a forbidding appearance. The IMPORTS AND EXPORTS, 1854-74. 35 1st. The gradual yearly progress of our commerce under the three heads of original imports, re-exports, and reten- tions for homo consumption or manufacture, with the per- centage of increase or decrease upon its immediate prede- cessor in each year, and upon 1854, the first year of the series. Also, in like manner, the total exports, divided into those of foreign or colonial oi'igin, and those of home pro- duce or manufacture; but it must be borne in mind that the exports of foreign and colonial articles thus shown are only those which leave our hands in an unaltered condition, for if subject to any manufacturing process or change of character, they become classified as of British manufacture, and are in- cluded as such in the columns devoted to that class. 2nd. The proportion of trade carried on both inwards and outwards with the principal countries of whom we are cus- tomers, and to whose markets we send our ])roductions. These figures, on account of the space which would be occupied by a statement of each year's traflBc, are only shown for every fifth year, and the percentage of increase as before upon the figures of 1854. A very imperfect idea, however, will be given of the extent to which we trade with many countries, from the indirect routes by which much of the transport is effected, and the varying channels through which this takes place. With some countries there is little but direct trade. Russia, for instance, neither receives nor sends us much but in vessels from or to her own ports and ours; but Germany obtains a large portion of her supplies — and forwards hers to us — through the ports of Holland, and even by railway through France. The goods which in ordi- nary seasons are shipped from Hamburg, when that port is closed by the ice come to us via Altona, and then get credited to Denmark. A line of steamers in connection with the French steamers to the Ea«t, periodically takes large special points of interest are in general incorporated witli the text, or are contained in other pnpers, and references are given to the oriu'infll vohimes in which they may be found by those who desire a more inti- niato a('f|iuiiiitaiioo willi llicir details. 36 TEOGRESS OF OUR FOREIGN TRADE, cargoos to Marseilles, for transmission to China, Hong Kong, Japan, and other places ; and on their return voyages they bring back cargoes from those countries transhipped at the French port. ]iefore the Suez Canal was made, the ships of the Peninsular and Oriental Company which now go through the canal cleared out in this country for Egypt, to which country the goods they carried wore deemed to be exported ; and in like manner goods brought through the Red Sea and overland to Alexandria, were treated as im- ports from that place. The same, thing happens in the winter season with goods to and from Canada via Portland in the United States. This evil is, as stated in the "Monthly Return " for January of the present year, in process of cor- rection, and so far as the ultimate destination is known, the exports are now credited to the countries to which they pro- perly belong. Too much reliance must not, therefore, be placed on the relative extent of our trade with the various countries specified in the tables, since for this reason there is in many cases much intermingling of one with the other. Neither is it always right to judge of the growth or decline from year to year of the trade with any particular country, since with the starting of new lines of communication material changes in this respect may and do arise. 3rd. The principal articles of which our imports and ex- ports consist are separated for each fifth year in the same manner as the countries are. In all these tables we are dealing with the values — neces- sarily so for the first and second pui'poses — since the totals can only be obtained by reducing the denominations of weight, measure, &c., in which the goods are taken to account to the common measure of value in pounds sterling; and this being done for the grand total as well as for the amounts to and from the. different countries, it is well to show the different articles in the same form. These sums, however, fail fully to show the variations from year to year, because, being founded upon the market prices existing at the time, which are constantly shifting, it is necessary to IMPORTS AND EXPORTS, 1854-74. 37 take such fluctuations into consideration in arriving at a correct judgment as to the real increase or decrease which is taking place. To assist in arriving at right conclusions on this point, there have been added tables, showing the quan- tities of some of the articles of greatest magnitude, with the percentage of increase for last year over that of the year with which we commence. A comparison of the rates of increase in the value and the quantity of each article will show whether the additional value is duo to greater bulk or to higher price. It should be noticed that one portion of the goods brought to and taken from this country is not included in any of the tables, namely, those which are mei*ely sent hither to find a vessel going to the place for which they are destined, and are transhipped from one ship to another without being landed here, A somewhat rough account is taken of their value (and in many cases the quantities of the articles). This is of some importance, because thus passing into and out of our waters they furnish employment for our ships and men, and its increase is an element of additional mercantile or maritime prosperity. The whole value of these transhipments during the past twenty years is as follows:' — [In iiiillion £"s to two dcciiiials.] 1854. '55. .'06. '57. '58. '59. '60. '61. '62. '63. '64. 5-05 4-58 4-51 4"49 6-65 5-14 442 4-71 5-3^ 5"99 £ 6-47 772 6-66 18G5 '66 '67 '68 7-28 '69 8-12 '70 10*94 '71 11-36 72 13*90 '73 1 376 '74 I "1-42 ' It would liiivi.' vithin. the strict bounds of a statistical 4() rUOGUESS UF OUK FOKKKiN 'J'KADE, paper, I would trespass somewhat upon the time and indul- j^'-ence of my hearers or readers — trenching in some mcasuro upon the province of the political economist — to pass in re- view some of the conclusions at which their consideration may enable us to arrive. Perhaps the most important feature in the whole is to be found in the enormous increase in the quantities and values of the food, other than that produced in our own country, which we are able to purchase and consume — an increase totally out of keeping with that which has taken place in the population. The estimated number of inhabitants to be fed in 1854 was 27,800,000; in 1874, 32,400,000— a diffe- rence of 4,600,000, or 1 6 per cent. ; whereas the supplies of food from abroad, after making due allowance for those re-exported, cannot be taken at less than 1 50 per cent, more than they were twenty years ago. The reason for this disproportion is two-fold : first, that the production of food at home does not keep pace with the growth of our popula- tion ; and next, that with increasing means of purchasing food, the quantity consumed by the mass of the people is greater, if not in bulk, yet in value. From the official tables — -first, I believe, compiled in 1867 — we find that the acre- age of land under cultivation for corn and green crops in that year was 16,384,000, and in 1873 almost exactly the same, viz., 16,394,000 acres. At the same periods we had of live stock — Cattle Sheej) Pigs The population having been In 1867. 8,731,000 33.818,000 4,221,100 3o.335'00o In 1873. 10.154.000 33,982,000 3,564,000 32,125,000 Except, therefore, to the extent to which improved methods of cultivation had increased the productiveness of IMPORTS AND EXPORTS, 1854-74. 47 the soil, it does not appear that in these six years there had been any substantial addition to the quantity of food grown at home. If this be so, the supplies needed for the addi- tional mouths must have been chiefly drawn from abroad. This might probably account for a large portion of the in- creased value within that period, but not for the 30 to 35 millions, which have since 18G9 been added to our annual payments for food; and hence it is evident, as indeed other circumstances prove, that there must be greater purchasing power in some or every portion of the community. That both the causes alluded to are in operation is also manifest from the unequal rate at which, in proportion to the popula- tion, the increase of consumption goes on in articles of which part is produced at home and part obtained from abroad, and in those derived from the latter source. Wheat, bacon, butter, cheese, eggs, have all risen with far greater rapidity than sugar, tea, tobacco, and wine. What we have to pro- vide by foreign importations of the first class, is the excess over previous consumption of both home and foreign produce. Of the latter, over foreign alone, and the percentage of in- crease should for the former class be calculated not upon the importations of 1854, but upon these added to the quantities raised at home. The contrast between the variations of price in different classes of food is very marked. Take potatoes for one : the increase in value is sixty-fold, in quantity but thirty-three- fold, showing that the price we now pay for the same weight is nearly double what it was twenty years back — in 1854 barely 3.S. per cwt., in 1874 more than 5s. per cwt. Wheat, however, which has increased 158 per cent, in quantity, is only 97 per cent, greater in value. So "with rice : 42 I in weight only makes 268 in value. On the other hand, butter, cheese, bacon, eggs, lard, are all dearer than they were in 1854 ; in eggs, especially, we see that whilst the number is eight times, the value is eleven times as great; all tending to show that though grain — which is the produce of coun- tries in all parts of the world — is cheaper, meat, dairy pro- 48 TROGRESS OF OUR FOREIGN TRADE, ducc, and thoso articles for wliich wo are limited to places uoar at hand, have risen so much in cost, that practically the necessaries of life are dearer than they were in the year with which our observations commence. A very satisfactory indication is furnished by the grow- ing addition to our employment of the raw materials which form the staple of our textile manufactures, and in the metals which are so largely worked up and sent away as British manufactures, as well as in wood, hides, seeds, &c. Turning to the Exports of British manufactures, we find the same results, the increase being very general ; cotton, linen, and woollen manufactures having all more than doubled both in value and quantity, keeping pace with the larger importations of the raw materials from which they are pro- duced. Here again the increase is more than commensurate with that of the population, showing that if the average consuming power is raised, so also is that of producing and manufacturing. Must not this, be due to the extended em- ployment and the superior character of our machinery, through which a far larger amount of material is worked up by each hand ? otherwise such an extension of our manu- factures could not possibly have taken place. There are several points of great interest connected with the different countries with which we have the largest trading relations and the progressive growth of these. We must leave Russia out of the question in comparing the two years we have chosen, because of the Crimean War in 1854 ; but the fact of her now sending us nearly twice as much as she takes from us, shows the extent to which she has served as a granary for the United Kingdom. The same cause produces the same result with regard to Fi-ance, and in some degree the United States. On the other hand, Ger- many and Holland are both better customers to us than we are to them. The disproportion between the imports from, and the exports to several countries are so remarkable, that they deserve to be placed in contrast. First, those in which our imports are now in excess. IMPORTS AND EXPORTS, 1854-74. [In million £'8 to two decimals.] 49 1874. Imj)orts. Exports. ! £ ' £ Russia 21*40 1130 Sweden and Norway io'97 "'30 Belgium I4"93 12-90 France 4669 2940 Spain I2"85 7-70 United States 74-10 ' 32-30 1879. Imports. Exports. £ 15-88 8-39 1073 38-46 8-40 91-82 £ 10-61 3-94 11-89 26-56 3-76 25'52 Then those in which the exports are greater : — [In million £'s to two decimals.] 1874. 1879. Imports. Exports. Imports. Exports. (Tcrmanv £ £ £ i £ 21-60 29-62 21-96 i 15*45 Holland 19 97 1 ^-r «vr T r -8 T oo-Rrt "" On the whole it will be seen that our imports are now £370,000,000 against exports of £297,000,000. In olden times this would have been thought a serious evil. It was at one time considered that the country which received goods to a greater value than -it returned must inevitably become impoverished. A diflferent theory then arose. It was thought that no country (not being one in which the precious metals existed,) could go on paying in goods more than it got back, and therefore it must bo taken that in some way or other the exports, though smaller in amount, did in fact meet the claims upon us for the larger imports. That consequently the disparity between the two was a source of congratulation, since the excess of value in the one over the other was really so much wealth accruing to us as the balance of our trading operations. To a certain — perhaps a considerable — extent this was true. The ox- E 50 PROGKESS OF OUR FOREIGN TRADE, port values being fixed at tlie time of shipment, did not represent the charges of transit or the profits to those who shipped them; whilst the import values being those at the time of arrival, did include the expense of bringing them and the profit on their sale by the first importers, most or all of which accrued to this country as being the greatest carrier both out and home, as well as the depot in which they were sold. Such an explanation, however, cannot serve to account for so large a difference as now exists. This to the minds of many can only be accounted for in one of two ways : either that there is some error in the method by which the values are ascertained, or that we are really doing a business which is alarming in its tendency towards ultimate bankruptcy. But surmises and fears like these may well be dismissed, and the belief that the difference is really an accession to the accumulated wealth of the country fully entertained.^ It is obvious that for years past there has been an annual increase, not only in the capital devoted to reproductive expenditure, which, when it is judiciously devoted to this purpose, goes on increasing in the way of compound in- terest ; but also in that which seeks investment abroad. That a large amount of capital thus supports foreign loans, makes railways, and likewise maintains gas, water, harbour, and other companies is well understood ; but it is almost impossible to form an estimate of the annual return it makes in the shape of interest or dividends. Beyond this, how- ever, there is reason to believe that considerable sums are invested in private agricultural and manufacturing under- takings, as well as employed in trading pursuits. What more likely than that the manufacturer at home, who finds the demands of labour interfere with his ability to gain an adequate return for his capital here, should carry some of it to like uses abroad ? Or that the merchant who desires to ^ It will be seen in the subsequent paper, " On tbe Preponderance of Imports," that this view is much modified bj the progress of trade since the year when this was written. IMPORTS AND EXPORTS, 1854-74. 51 draw consignments of foreign or colonial produce to his establishments at home, should advance the money which pays for the cultivation of the soil and the gathering in of the produce ; should build or charter the ships, not only those which are employed in the direct trade, but in the coast or international carrying in distant countries ? It is well known that on this system the cultivation of our West Indian colonies was carried on so largely when slavery existed there ; that in this way the Northern States of tlie Union in America reaped the profits of slavery in the Southern; and there is no doubt that scarcely a country exists, or cultivation or manufactures carried on in any part of the world, in which British capital or British skill, paid for in money value beyond the cost of its mainte- nance, has not its share. Now, all this is in reality carried on more by credit than the actual transmission of money, but it nevertheless brings in large profits which in one shape or another must be remitted to this country. And why not in goods for which no equivalent exportation is made ? This will go on in an accelerated ratio, so that it is not abso- lutely impossible to conceive that the time may come when the imports we receive will not do more than represent the returns made for the use of British capital and credit. The recipients of these returns have but to consume the produce of our home growth and labour, in reality paying for them with the goods drawn from abroad; and thus manufactures might flourish and prosperity exist without a single article of export ever being made. The true interest of the capitalist at home, who finds that either there is a supcrabundauro of that which he has to employ, or that the conditions of the labour market here prevent his obtaining an adequate re- turn, seems to be, to seek to stimulate production elsewhere, or to encourage trade in distant places ; himself directing from hence their proper developments, and enjoying hero the fruits of his means and his talents. Still the question arises on the face of these figures, whether in truth the trade of the kingdom has not received 52 PROGRESS OF OUR FOKEIGN TRADE, a decided check. It will Le seen that 1871-72-73 were the years in which it seemed to have reached its highest point, and that 1874 contrasts unfavourably in every particular. The percentages of increase which in the former years had reached, for retained imports 136, for exports of foreign goods 225, and of British 164 per cent., have in the last receded to 1 56,209, and 1 46 respectively. The four months ^ of the present year manifest a considerable decline upon the corresponding period of last year, and would thus evi- dence that the diminishing process is still going on. Time alone will show whether this is one of those cycles of comparative stagnation from which we have often before recovered, or whether the conditions which regulate the re- lations of capital and labour to each other have not really so changed that we are transferring our superiority to other lands. Enough, however, has been said to show the enor- mous strides which British commerce and manufacture has made within the last twenty years. We may yet indulge the hope that our prosperity, not having reached its climax, will shortly manifest as great a revival as we have often witnessed before; and will in future years attain still greater magnitude, if not with quite as rapid a growth as hitherto has rewarded our national enterprise, wealth, and skill. ^ Imports in 1874, £123,915,925; in 1875, £119,549,154. Ex- ports (British) in 1874, £77,234,354 ; in 1875, £73,282,069. Full tables of imports and expoi'ts for subsequent years are given at pp. 61, 66, et seq. IMPORTS AND EXPORTS, 18o4-74. r.3 APPENDIX. Table I. — Total Value of Goo/ls Imported into thu United Kingdom, and of those Re-Exported therefrom in each Year from 1854 to 1874, with the Increase or Decrease per Cent, in each on the previous Year, and also on 1854 [1875 to 1879 added atfoot.l [In million £'s to two decimals.] Imported, Re-Exported. Retained for Home Consumption. Year. Increase ";; Increase or Increase or Decrease. Dee rease. On 18.51. Decrease. Pr. Year. On 1854. Tr.Year Pr.Year. On 1854. £ Per cnt. ■ Per cnt. £ Per cnt. Per cnt. £ Per cnt. Per cnt 1854 .. i52'39 - — 18-63 — — 133-75 — — '55 .. i43'54 - 5-7 — 5 '7 21 -oo 4- 12-7 4- 12-7 122-54 — 8-4 — 8-4 '56 .. <72'54 + 20-2 + 13-2 23 '39 4- 11-4 I4- 255 I49'i5 4-21-7 4- "-5 '67 .. 187-84 + 8-4 + 233 24-11 4- 3 4- 29-4 163 73 4- 9-8 4- 224 '58 .. 164-58 — 12-4 + 7 '9 2317 — 3-9 4- 24-4 141-41 — 13-6 I4- 5-7 •59 .. 179-18 + 8-8 ^4- .7-6 25-28 4- 9-1 4- 35-7 153-90 4- 8-8 4- 1 15-1 1860 .. 210-53 + 17-5 + 381 28-63 4- 13 2 1 4- 53-7 181-90 4- 18-1 4- 36-0 '61 .. 21749 + 3-3 1 + 42-7 34'S3 4- 20-6 4- 85-4 182-96 4- 0-6 4- 36S '62 .. 225-72 + 3-9 + 48-1 42-18 4- 22- 1 4- 126-5 183 54 4- 03 4- 37"2 •63 .. 243-92 + 10-0 + 63-3 S0'30 4- 19-2 4- 170-0 198-62 4- 8-2 4- 48-5 '64 .. 274'95 4- 10-6 + 80-4 52-14 4- ;v7 4- 1800 222-81 4- 12-2 + 66-6 1865 .. 271-07 - 1-4 1 + 77'9 S3'oo 4- 16 4- 184-7 2i3o8 - 21 4- 63-0 '66 .. 295-29 + 9-0 + 93-8 49'99 4- ^.-7 4- 1680 245 30 4- 12.5 4- 834 '67 .. 275-18 — 6-8 4- 806 44-84 — 10-3 4- 140-9 230 34 — 61 4- 72-2 '68 .. 294-69 + 7-1 4- 93'4 4»-io 4- 7-3 1 + 1584 246-59 4- 75 4- 84-3 •69 .. 295-46 + 0-3 4- 93'9 4706 — 2-2 4- 152-8 248-40 4- 0-8 4- 85-7 1870 .. 303-26 4- 2-6 + 99-0 44'49 — 5-5 U i39'o 258-76 4- 4-2 4- 93-4 •71 .. 331 02 + 9-2 + 117-2 6o'5i 4- 35 9 4- 225-1 27051 4- 4-5 4- I02'2 '72 .. 354-69 , + 7-2 + i32"7 53-33 — 3-6 4- 213-4 296-36 4- 9-5 4- 121 '6 '73 .. 371-2^ + 4-7 1 + 143-6 .S5-84 — 4-3 4- 200-0 3'5-45 4- 6-5 4- 1358 '74 .. 370-08 - 0-3 4- 142-9 58-09 4- 30 4- 2(1 '6 311-99 — 0-9 4- 132-5 Total \ I'l I 5.339'7' — — 863-61 — — 4,476-10 — — years ) ' Aver- 1 age 25427 4111 21314 1H75 .. 373-94 + I'O + M5'4 58-15 4- 0-1 4- 2' 1-9 315-79 + wV 136- 1 •7« .. 375"'S 4- 0-3 4- 146 2 56 14 — 3 4 4- 201 '2 319-01 4- 1-3 4- >39"3 •77 .. 394'42 4- 5-1 4- 158-1 53-45 — 4-8 4- 186-7 340-97 4- 6-9 4- '54 "9 '78 .. 368-77 — 6-5 4- 142*0 52-63 — 1-6 4- 182-3 31614 — 7-314- 136-4 ■79 .. 362-99 — 1-6 4- 138-2 57-25 4- 8-8 4- 207-1 305-74 — 3-3 4- 138-6 54 PROGRESS OF OUR FOREIGN TRADE. Table IT. — Value of Goods Exported from the United Kingdom, dis- tinguishing those of Foreign and Colonial Produce, and those of British Manufacture, in each Year from 1854 to 1874, with the Increase or Decrease per Cent, in each Year, on that of its prede- cessor, and also on 1854. [1875 to 1879 added.'] [In million &'a to two decimals.] Exported. Foreign and Colonial. British. Year. Increase or Decrease. Increase or Decrease. Increase or Decrease. Pr.Year. On 1854. Pr.Year. On 18.54. Pr.Year. On 18.54. £ 1 Per cnt. Per cnt. £ Per cnt. Per cnt. & Per cnt. Per cnt. 1854 .. 115-82 1 — — 1864 — — 9718 — 1 — '55 .. 116-69 1 + 0-7 + 0-7 21 'oo + 12-7 + 12-7 95-69 - 1-5 1- 1-5 '56 .. 139-22 1 + 19-0 1+ 20-2 23 39 + 11-4 + 25-5 "5 83 + 21-0 ,+ 19-2 '57 .. 146-17 + 6-0 + 26-2 24-11 + 3-0 + 29-4 122-06 + 5-4 + 25-6 'r.8 .. i39'78 — 4-4 + 20 2 23-17 — 3-9 + 24-4 11661 — 4-5 + 20 "o '59 .. iS5'69 + 11-4 + 34'4 25-28 + 9-1 + 35-7 130-41 + 11-8 + 34-2 1860 .. 164-52 + 5-7 + 42"! 28-63 + 13-2 + 53"7 i35'89 + 4-2 + 40-0 '61 .. 159 '63 — 3-0 + 377 3453 + 20-6 + 85-4 125-10 — 7-9 ;+ 28-7 '62 .. 166-17 + 4-1 + 43"5 4218 + 22-1 +•126-5 123-99 — 0-9 + 27-6 '63 .. 196-90 + 18-5 + 70 '0 50'30 + 19-2 + 170-0 146-60 + 18-2 + 50-8 '64 .. 212-59 + 7-9 + 83-4 52"i4 + 3-7 + 180-0 16045 + 9-4 + 65-1 1865 .. 218-83 + 2-9 + 88-9 S3'oo + 1-6 + 184-7 165-83 + 3-4 + 70-6 '66 .. 238-91 1 + 9-1 + 106-3 49 "99 — 5-7 + 168-0 188-92 + 13-9 1+ 94-3 •67 .. 225-80 ! — 5-5 + 94'9 44-84 — 10-3 + 140-9 18096 — 4-2 !+ 86-2 '68 .. 227-78 ! + 0-9 + 96-7 48-10 + 7-3 + 158-4 179-68 — 0-7 ,+ 84-9 '69 .. 23702 +40 + io4'7 4706 — 2-2 + 152-8 189-96 + 5-7 + 95 4 1870 .. 244-08 + 3-0 + iio"8 44"49 — 5-6 + 139'° i99'S9 + 5-1 + 105 '3 71 .. 283-58 + 16-2 + I44"9 60-51 + 35-9 + 225-1 223-07 + 11-8 + 129-5 '72 .. 314-59 i + 10-9 + i7i'6 58-33 — 3-6 + 213-4 256-26 + 14-9 1+ 1636 '73 .. 3II-OI i - 1-1 + 168-6 5 5 '84 — 4-3 + 200 255-17 — 0-4 + 162-5 '74 .. 297-65 1 — 4'5 + 156-4 5809 + 30 + 211-6 239-56 — 6-2 + 146-3 Total ) 21 f years J 4.3i2"43 — — 863-62 — — 3,448-81 — — Aver- age 205-36 1 — 4X12I _ ~ 164-23 1875 .. 281-61 — 0-5 + i43'2 58-15 + 0-1 + 211-9 223-47 — 6-7 + 129-9 '76 .. 256-78 — 8-8 + 127-1 Sfi'M — 3-4 + 201 2 200-64 — 10-1 + 106-4 '77 .. 252-35 - 1-7 + Ii7'i S3'4S — 4-8 + 186-7 198-89 — 0-9 + IQ4-6 '78 .. 245"48 - 2-7 + 112-0 S2'63 — 1-6 + 182-3 192-85 — 30 + 98-5 '79 .. 248-78 + 1-3 + it4-8 57 '25 + 8-8 + 207-1 191-53 — 0-7 1 + 97-1 III. The Growing Preponderance op Imports over Exports IN THE Foreign and Colonial Trade of the United Kingdom/ SINCE 1872 a marked alteration has taken place in the relative values of the imports and exports of the United Kingdom. Up to that date, and indeed until the middle of 1873, the general progress of our trade showed a steady increase in both branches ; and if here and there special circumstances caused one year to fall short of its predecessor, the deficit was speedily more than restored. We had come to look upon continual growth as the normal condition of our commerce, and though for about half a century the balance had been in favour of imports, this excess arose from their continuous increase, not as now, partly from the decrease of the exports. For 1872 the difference between the two — the balance of trade as it is usually termed — was 40 millions, for the present year it is nearly three times as much, i 1 8 millions. So decided and rapid a change demands more than a superficial inquiry into its causes and effects, and it is hoped that the figures now to be produced will at least aid investigations as deep and searching as the importance of the subject requires. I. — Earlier Period of Trade, 1816-53. Before considering the particulars furnished from oflicial sources regarding the trade of more recent years, it would have been interesting and useful to have taken a survey of an earlier period, and in so doing to have glanced back- ' Read before the Statistical Society, IDtli Decouibor, 187G. Vol. xl. 56 PREPONDERANCE OF ward so far as we have any data on which reliance can he placed. Having this object in view, it would have been possible to commence with the year 1699, when both imports and exports were each estimated as slightly under six millions. Unfortunately, however, the accounts were kept in what were termed " official values ; " that is, a tariff' of prices supposed to represent the values of the various articles — and really doing so at the time when each first became known to, or distinguished in the trade accounts — was employed for the purpose of representing quantities by money. Such a system had its use as a means of com- paring the current year with its immediate predecessor, but as prices altered, and the relative quantities of goods changed, it would so far depart from accuracy as to be of little worth. Exporters were for other reasons called upon to declare the values of their respective shipments, and the collected amounts were recorded; but no such step was taken for the imports until much later on. The figures, therefore, in the following table must be taken with great limitation. The year 1816, with which the table commences, may be deemed the opening one of a new era in our commercial operations. The long period of continental and other warfare, culminating in the events of 1815, must have so disturbed our trading relations as to render any comparison of prior with succeeding years very unsafe. From that year to 1853 there appears to have been a steady progress in both imports and exports, but not by any means in the same I'atio. The figures are here reproduced as an inte- resting if not an absolutely necessary introduction to the more definite details of the subsequent period ; and the " declared ^' as well as " official " values of the British exports shown for the purpose of correcting many erroneous esti- mates which have been formed of the worth of our export trade during those years. In the two columns on the opposite sides of the next page IMPORTS OVER EXPORTS. 57 Table I. — Value of Goods imported into, and Exported from, the l^tiited Kingdom, from 1816 to 180.3, Computed at the Official Ita'fs ; showing also the Declared Value of the British Exports. [In million £'s to two decimals.] Foreign and Colonial Merchandise. | Produce and Manufacture Total (Official Vuliic '.) of United Kingilom. Exports. Years. Total Exported from Retained for Home Use. Official Declared Official Impoiti*. United Kingdom. Value. Value. Values. £ ^• X- £ £ £. 1816 ... 27-43 13-48 13-95 35-72 41-65 49-20 '17 ... 30'^3 1029 20-54 40 11 41-82 50-40 '18 ... 3689 1086 2603 42-70 46-47 53-56 '19 ... 3078 9-91 20-.V7 33-53 35-21 43-44 1820... 32-47 10-56 21-91 38-39 36-42 48-95 '21 ... 30-84 10-63 20-21 40-83 3666 5 1 -4a '22 ... 30-53 9-23 2 1 -30 44-24 3697 53-47 '23 ... 35-80 8-60 27-20 43-83 35'3(> 52-43 '24 ... 37*47 10-21 27-26 48-73 3842 58-94 182.'>.. 44-21 9-17 35-04 47-15 38-87 56-32 '26 .. 37-81 io-o8 27-73 40-96 31-54 51-04 "27 ... 44-91 9-83 35-08 52-22 37-^S 6205 '28 ... 45-17 9-95 35-22 £2-78 36-81 62-73 '29 ... 43-99 10-62 33-37 56-22 35-S4 6684 1830... 4630 8-55 37-75 61-15 3S-27 69-70 '31 ... 49-73 IO-75 38-98 60-68 37-16 71-43 '32 ... 44-61 1105 33-56 65-02 3645 7607 '33 ... 45-94 9-83 36-11 69-99 39-67 79-82 '34 ... 49-37 11-56 37-81 73-84 41-65 85-40 1835 ... 4903 12-80 36-23 78-36 4T37 9116 '36 ... 57-30 12-39 44-91 85-22 53-29 9761 '37 ... 54-76 13-24 41-53 72-54 42-07 85-78 '38... 61-26 12-71 48-55 92--)5 5006 105-17 '39 ... 62-05 1 2 80 49-25 97-39 53-23 11019 1840 ... 67-49 13-77 53-72 102-71 51-41 116-48 '41 ... 64-44 14-72 49-72 102-18 51-64 116-90 '42 ... 6525 13-59 51-66 100-25 47-38 113-84 '43 ... 70-22 1396 56-26 117-87 32-28 131-S3 '44... 75-45 14-40 61 05 131-55 5S-5S 145-96 1845 ... 85-30 16-28 6902 134-60 6o'ii 150-88 '46 .. 7593 16-30 59-63 132-31 57-79 14862 '47 ... 90-92 20-04 70-f-8 12613 58-84 146-17 '48... 9355 18-38 75-17 132-61 52-85 150-99 '49 ... 10588 25-56 80-32 164-53 6360 19009 1850 ... 100-47 21-89 78-58 175-44 7' 37 197-33 '51 ... 110-48 23-73 86 75 190-66 7445 214-^,9 '52 ... 109-33 2333 86 00 19618 78-08 219-51 '53... 123-10 27-75 95-35 214-32 98-93 242-07 38 years 2-267-29 522-77 1-744-52 3-395-46 1-845-75 3918-23 58 PREPONDERANCE OF will be found the yearly total values of the imports and exports as derived from official sources. The middle column on the import side of the table sets forth the value of imported articles exported to foreign countries, which, in any comparison with British exports, should be deducted. This is done in the next column, which shows the difference between the two, or the value of the imports retained in the country for home use. Adjoining this will be found the value of goods of home produce and manufacture exported, constituting what may be termed the credit side of the account. The difference between the two, as also that between the right and left-hand columns, will give the nearest approach to the preponderance or otherwise of imports or exports it is possible to abstract directly from these records, for the years embraced in this table. For the reasons above stated, prior to 1854, we have no means of accurately ascertaining in what relation the values of our imports stood to those of our exports, but by a change of system in that year the real import values were obtained ; and from this we learn that whilst the market prices of the exports were continually falling, the not unnatural result of improvement and competition in manu- facture, those of the imports were constantly rising ; the equally rational effect of demand overtaking supply, and the growing wealth of those who were the purchasers. In that year the actual value of 152 millions of imports stood officially at 1 24, whilst the true value of 1 16 millions of exports was represented officially as 243 : an official deficit in the one case of 28, and an excess in the other of 127. Reasoning from the official valuation, we should conclude the balance in favour of exports to have been 120 millions, whereas the true figures show it to have been 37 millions in favour of imports. Such being the case with the figures up to ] 853, any attempt to deal with them as showing the progressive preponderance either way would be hopeless. An attempt has been made to convert " official " into " actual " for the imports, but it soon became evident that IMPORTS OVER EXPORTS. 59 the labour of such an effort would be greatly beyond the worth of the results to be obtained, results too doubtful to support any argument or to guide any judgment. It is probable, however, that in assuming the official value of 14 millions for the imports retained in 1816 to have been really equal to I 7, as against 4 1 of British exports, and the 95 millions in 1853 as really i 30 against 99 of exports, we shall not be far wide of the mark. If these be correct estimates, the foreign goods consumed in this country had between 1810 and 1853 multiplied sevenfold in value, and the exports of British goods only doubled, thus altering the excess from one side of the account to the other. It is probable that the time when the imports overtook the exports was about the year 1825, since when there has been a growing preponderance in their favour. II. — Period from, 1854 to the Present Time. From 1 854 the import values, as published in the monthly and annual accounts of trade and navigation, assumed a new aspect. They still continued to be computed, but upon the basis of the current market values of the articles, and as the declared values of the exports were given by the merchants upon the same foundation, the two sets of figures may be fairly brought into comparison. As such they are given in Table II., which is continued in the same form as Table I., with two exceptions. The official value, although discarded from the Trade accounts, continued until 18?0 to be pub- lished in the Finance accounts annually presented to Par- liament. For information, therefore, and as illustrating the discrepancies between them and the real values, they are inserted in the table as a second line for each year. Another column, too, has been added, in which the exports having been deducted from the imports, the difference is shown as an excess of the latter, and the percentage of this excess upon the export value has been brought out. An average for the twenty-three years 1854-76 inclusive, is likewise shown : — (;o J'UEl'UNDEUAXCE OF Table II. — In co/itinuafion of Table I., from 18.54 (o 1876, showing the Compnfed Real Vdlnes of Imporla vp to 1 870, the Declared Values of Imports from 1871, and of Exports for the whole Period; also the Offu'ml Values up to 1869. [1877 to 1879 uddrd.'] Note. — Figures printed thus (is2'3g) are computed to 1870, declared to 1876, those in italics are official. IMPORTS OVER EXPORTS. 61 1877...! 394"42 53-45 ! 340-97 I 198-89 252-34 '78...! 36877 52-63 316-14 I 192-85 245-48 '79...! 36299 ; 57-25 i 305-74 1 191-53 , 248-78 142-08 123-29 114-21 71 64 60 III. — Alterations to he made in Belative Values. Beginning then with 1854, we leave a period in which arbitrary and antiquated prices were employed to convert quantities into value, and come to one in which the values being based upon existing prices and known market rates, the figures given may be taken as a fair valuation of the goods at the time when they arrive and leave the country. They thus afford satisfactory information of the amount of trade which is being transacted, and by comparison of suc- cessive years of its advance or decay ; but they are still in- sufficient for enabling us to determine the balance of trade, or as it may be better stated, the actual amount of money or money's worth which is necessary for the settlement of the balances between the nation and its customers. And for this reason amongst others : that it is essential for uniformity's sake to lay down a rigid rule as to the time and ])lace at which the valuation is taken, whilst under the actual condi- tions of trade the selling and the purchasing prices admit of continually changing adjustments. The goods which are sent abroad increase or decrease in value before they are used in payment for those we receive; these again are seldom placed upon the market at home at the same price as that at which they change hands abroad, and it is easy to perceive that the pound of value assigned to the import is not neces- sarily or often equivalent to the pound of export. For statistical purposes the value required is, that which the articles bear at the time when the vessels in which they are conveyed arrive at, or depart from, the several ports in the kingdom ; that is, the sum of money which should be given in exchange for the bill of lading, which is the title for pos- session of the property. This includes the cost of bringing our imports hither, but excludes that of conveying the ex- C)2 rilErONDERANCE OF ports to tlieir destination, and thus leaves a considerable margin to be deducted from the one total or added to tho other before the true difl'erence can be ascertained. Again, in the official totals no account is taken of the coin and bullion which passes to and fro, and as regards the exports there are goods other than what is ordinarily termed merchandise, which need to be brought into the account, with other cir- cumstances, to all of which a consideration in detail must be given. To take the imports first. There is a large amount of specie and precious metal continually passing backwards and forwards between the various countries as a circulating medium, or in adjustment of the exchanges at the different monetary centres. The same coin or ingots may be, and are, transferred from one place to another very many times in the year, and though a separate account is kept of these removals, and much care is bestowed to make this as cor- rect as possible, the value is not included in the totals of either the imports or the exports. To add the whole would unduly swell both amounts, but the balance must clearly be placed to whichever side it belongs. This will consist of the floating stock which for the time being happens to be re- maining in the country, together with such quantities as are absorbed in the arts and manufactures, or employed in the increase or renewal of the coinage. It is a far more difficult task to ascertain what allowances should be made for the charges upon bringing the articles of import from the place of production or pm-chase, to that at which the value is assigned, but the extreme importance of obtaining a correct estimate has been made the occasion of a series of extended and minute calculations, by which it is hoped an approximation to the actual cost has at least been obtained ; and as no mere statement of the results would caiTy conviction to the minds of those who are conversant with trade, it may be well to briefly describe the method which has been pursued. With cotton — the greatest of all our importations — as an example, quotations have been ob- IMPORTS OVER EXPORTS. 63 taincd of the actual amounts paid for freight from each of the principal ports in America^ for the last twenty years ; regard has been paid to the quantities shipped from each of these ports, and the periods of the year, whether in the slack or busy season, at which these have been made. An average has thus been arrived at for each year, and applying this to the average price per pound at which the cotton stands for the same year, the charge per cent, on the value has been ascertained. Similar processes have been gone through with corn, tea, sugar, wine, timber, &c., &c., to such an ex- tent as to justify the conclusion that the declared import value is from this cause enhanced by Sl to i 21 per cent. On a consideration of the whole it would seem that 1 1 per cent, is a fair average, and at this ratio the freight has been worked out for each year since 1854. The validity of this estimate may be tested in another way. We have now from 44- to 5 million tons of British shipping employed in the foreign carrying trade ; assuming £6 per ton per annum as a fair estimate of gross earnings, of which one-fourth is chargeable to the export trade, we shall have say 22 millions J but perhaps one- third of the imported goods are brought in Foreign ships, and one-half of this sum must be added for the freight carried by these, giving thus a total of say 33 millions — not greatly below the 35 millions which has been assumed as the deduction for the present year. To corroborate these calculations, the ascertained import freight lists of several vessels for a series of years, actually give an average of Sgs. per ton, which very nearly corresponds with four-fifths of the £6 above assumed. On the export side, all the alteration will be in the shape of additions. In the first place, wo build many vessels for foreigners, which, sailing away with cargoes, are not them- selves deemed to be exports, but are just as much so as other goods taken from the country. Careful inquiries by an eminent shipbuilding firm as to the average contract price per ton in each year for sailing vessels and steamers, have furnished a sum to be added on this account. Another item 64 PREPONDERANCE OF is that of victualling supplies and stores, which, though never, included in the exports, should be, inasmuch as they are so much goods sent away for profit in the shape of freight to bo earned on both outward and homeward voyages. It has been estimated, from a comparison of actual outlays obtained from various firms, that these will amount to 20s. a ton per annum for sailing vessels, and 30s. for steamers, and at these rates the calculation has been made. A further addition must be made for the quantity of coals shipped for the use of steamers. No record of this was kept until within the last two years, but dividing these quantities by the tonnage of the vessels to which they were supplied, and assuming a similar rate of consumption for previous years, it is not difficult to find a value for each year according to the prices given for cargoes exported at the same times. It has been necessary to specify at some length the various methods by which these estimates — for they are not positive facts — have been obtained, in order that those conversant with the various branches of business may form some ideas as to their probable accuracy. Conjectural amounts may not be very safe to rely upon, but these have all been very carefully made upon data collected from numerous au- thentic sources, and have been subjected to most exhaustive computations, involving a mass of figures and a large expen- diture of time, in order that the result might be deemed to have real worth. The several details are displayed in the following table : — IMPORTS OVER EXPORTS. 65 Table III. — Showing the Corrections of Excess of Imports {Table I J.) by Addition of Balance of Bullion aiul Deduction for Freight ; and by Additions to Exports for Ships Built for Foreigners, Victualling, and Ships' Stores, and Coals for use of Steamers. [1877-9 added.^ [In million £'.s to two ilecimul^.] I nip irts. Exports. Assumed Balance to l)e Years. Apparent JKxce.ss of AiUl DcliRt Add Add Add Imiwrts. — .Ships for Victualling Coals Provided Bullion. FroiRht. and for for. Foreigners. Stores. Steamers. £ £ £ £ £ £ £ 1854... 36-6 j not i-1 not 1 2-8 •2 iiscertained recorded ' '55... 26-9 >) ^JS ■9 J' •2 '56... 33-3 „ 16-4 I'2 3'3 •2 '57... 41-7 .. iSo 1-2 J3 '3 — 1858... 24-8 99 15' 5 ro 3-4 •3 14-5 '59... 23-5 1-4 i6'

' 42- 141- 6- iSg' '67 230- lor 100- 29- 27' 42- 134- s- i8r '68 24T 105- 110- 32- 38- 42- 133- 5- i8o- '69 248- 106- 108- 34- 2g- 50- 135- 5- /go' 1870 259' lOO- 119- 40- 34' 53- 1.59- r igg- '71 271- 118- 117- 36- /J* 58- 155- lo- 223- '72 2g6' 136- 125- 35- —4' 76- 173- T 256- '73 315- 147- 133- 35* ig- 85- 161- 9' 255' '74 312- 143- 130- 39- 2g- 78- 154- 8- 240' '75 J/6- 157- 118- 41' 54' 67- 149- r 223- '76 3'9- 159- 119- 41" 83' 57- 138- T 201' 1877 34'- 177- 121- 43- 9f .55- 136- 8- igg- '78 3,6- 167- 103- 44" 84' 53- 133- 7- '93' '79 30& 167- 100- 39- 6t 52- 133- 7- ig2' It may be obscrvod in the first place, that articles for food which in 1851' were imported to a rather less value tliau those for manufacture, are now vastly in excess. In IS7I 72 TRErONDERANCE OF they were nearly equal to each other; by 1875 the one had increased from Il8 to 157, the other scarcely at all. In the present year it is believed the disproportion will be greater. The total amounts of both are less than they would be but for the low prices which have prevailed — a cause, however, which has certainly not affected materials more than food. The conclusion that we are buying more food and selling fewer manufactured goods tallies with the diminu- tion of our exports. Again, it may be noticed that the exports of manufac- tures from foreign materials, which in 1854 only exceeded the value of the materials imported by 8 per cent. (66 to 61), were last year 18 per cent, in excess (149 to I 18), seeming to comport with what we know of the increasing cost of labour. These two circumstances — the growing expenditure for food, and the increasing cost of manufactures — cannot both arise from the prevalence of low prices, nor are they likely to be remedied by any revival of trade to which present in- dications point. If food become dearer it will not cheapen the manufactures we sell, and if at present prices we are being undersold by foreign producers, it is scarcely pro- bable that a general rise in values will at all check the rapid growth of excess in our imports. To recur to the net balances which have to be adjusted ; we find that they are larger than they have ever been before, that they are in- creasing in an accelerated ratio, and that our export trade furnishes no indication of being able to alter their amount, any more than our import does of their being reduced. Further, that all this occurs conjointly with default in remit- tances for dividends on foreign loans, and that on all sides we hear that this extended import and diminished export trade is unaccompanied by the usual rate of profits. Unless, therefore, some radical change take place in the conditions of our trade and manufacture, or the system upon which they are conducted, these unfavourable symptoms will every year become more painfully apparent. IMPORTS OVER EXPORTS. 73 VI. — Concluding Bemarks. Whatj then, are tho requisite changes ? How may the growing evils indicated by the figures we have before us be checked or averted ? Those are questions for the political economist rather than the statistical inquirer. If, however, the investigation we have been pursuing has at all served to make clear facts of importance as regards our natural posi- tion as a manufacturing and trading community, I crave your indulgence for the utterance of a few thoughts which have arisen during its progress. The gravity of the situation lies in the fact that whilst we are every year becoming more dependent upon foreign sup- plies for the support of our population, the products of its industry are becoming less necessary to the countries from which those supplies are drawn. Whilst fancied security in our ability to defy competition, and a knowledge of the large profits hitherto accruing to our manutacturers, have induced our artisans and labourers to grow more exacting in their demands, and their masters to be more lavish in their ex- penditure, other nations liave been profiting by our experi- ence, and rival manufactories have been springing up on all sides. Whilst we have been appropriating a large portion of our earnings to the increaseof our productive powers, othernations have been calling forth and utilizing their natural advantages ; so that, for a time at least, supply has overtaken demand, and competition has lowered prices to such an extent as to render a large recovery very doubtful. Whilst we have been freely lending our money to other nations, thereby enabling them to pay for their purchases from us, more than one of those deeply iu our debt have been repudiating or neglecting their pecuniary obligations to us, and so acting that it seems uncertain whether national expenditure may not be forced upon us for their maintenance, or repression, as the case may be. Is it, then, for us to sit down in inactivity or despair? Such has not been the Anglo- Saxon character 74 PREPONDERANCE OF hitherto ; such "will not be the conduct of Anglo-Saxons now. If we have been running riot in the "seven ears full and good," and are about to suffer from the " seven thin ears blasted with the cast wind/' we may learn such lessons from adversity as to lay the foundation of a higher state of prospeinty than any we have yet attained to. Our labourers must learn that if trade is to be maintained the cost of production must be limited. To this end wages will have to fall, but if so, the cost of living will fall also ; and if not, there is no need for them to earn less, for temperance and economy of time will enable them to produce more. It is said that we spend annually i 50 millions in intoxica- ting drinks, as much as all our food imports cost us. At least one-half of this might be easily saved by the lower classes for better employment, and the country would be spared the expenditure of an enormous sum in the mainte- nance of poor-houses, hospitals, police, and gaols. Our capitalists, and those who live upon them, need to restrain the heavy expenditure accompanying the cravings of ambition, the undue pursuit of pleasure and frivolous idleness. They will seek to invest their money in places where new industries are to be established, and new markets to be found, whilst a large number of those whose brains are their only capital, must cease from the wild speculation by which so many strive to live ; seeking to make their fortunes not by honest industry, but by being sharper than their neighbours, thus, in truth, enhancing the cost to the con- sumer of all that passes through their hands. Our rulers, now that the days of heavier taxation are looming before us, may well endeavour to reduce the costly expenditui-e of preparation for war, and devote more atten- tion to extending our peaceful influence upon, and inter- course with, the countries which want but this to become valuable customers and faithful friends. But are we not all labourers, capitalists, rulers ? and as such are not these lessons for ourselves ? The food we eat, the water we drink, the air we inspire, are but so many con- IMPORTS OVER EXPORTS. 75 stituentsin creating and maintaining the physical power and the nervous energy which must be expended in labour of some sort, or they become inert ; are there not abundant fields for their employment, as so many have already found, in new countries, or in old ones capable of being renewed ? Are we not all capitalists ? The knowledge we have imbibed, the experience we have inherited or acquired, the brain power we possess, are but so much capital capable of profitable investment; especially when accompanied with, or supported by, the money capital of which there is no lack for promising uses. Again, are we not all rulers ? The liberty for self-govern- ment, the parental, conjugal, and social relationships in which we stand, are so many powers to be wisely employed in ruling ourselves and others, for our own and their advan- tage, which need but to be so devoted for the economizing of our present means, and the production of material addi- tions to our varied resources. I firmly believe that Britain now stands tottering on the eminence to which she has attained, and that it rests entirely with her sons whether a further rise or a rapid fall is to mark her future history. It may be said that no nation has hitherto stayed in its upward progress without suffering a speedy descent. Other nations have possessed wealth, science, art, but none have ever combined with these the higher gifts which we enjoy. Let these but be consecrated to the advancement of civilization and Christianity through- out the world, and I, for one, have no fear for our lasting prosperity or enduring glory. Say not these are but the visions of an enthusiast: such enthusiasm has had its share in making us what we are, it may yet play an important part in* the salvation of our country, and the regeneration of the world. IV. On the Increasing Dependence of this Country upon Foreign Supplies for Food/ HAVING occasion, in preparing a recent paper for the Statistical Society of London, to divide the value of the Imports, under the several headings of Food, Raw Materials, Manufactures, &c., I was surprised to find how large a proportion of the whole fell to the first of these, viz.. Articles for Food : — and having been honoured by a request from your President that I would contribute a paper to the Transactions of this Society, I felt that I could not well choose a more appropriate subject than the one which stands for to-night's discussion. To citizens of this northern metropolis, which has so large a share in pro- viding clothing, not for our own country alone, but for the inhabitants of the whole world, the question of how its workers are supplied with food can scarcely fail to be one of the greatest interest ; whilst the present position of our trade and manufactures rendei's its due consideration of the highest importance to the national progress and well- being. In treating this matter, I propose first to inquire what are the actual facts as to our present consumption of food from abroad, and to trace the growth of the provision imports in their several subdivisions. Next, to compare the foreign supplies with those of home growth, touching upon the sources from which our necessities are supplied. ^ Read before the Mancliester Statistical Society, April lltli, 1877. DEPENDENCE UPON FOREIGN SUPPLIES FOR FOOD. 77 Then to consider briefly some points of special importance as regards the interests of both consumers and producers ; and, lastly, to view the question in connection with the financial and other relations in which this country stands to the rest of the world. I. That we may get a connected and comparative view of the food imports for a series of years it will be well, in the first place, to look at them in their total money value, that being the only denomination under which the various weights, measures, &c., can be collected together. Yet this is in some measure faulty, for the fluctuations from year to year in the prices of the different articles prevent the value from being a strictly true representative of quantity. This we shall be able to see for the several articles, but not quite accurately for all together. In the paper referred to, I started with 1854, that being the earliest year in which the values were collected on a system at all analogous to that now adopted, so that one period could be compared with another. For the present purpose 1 commence with 1857, as being just twenty years back, and the first also of the peaceful era which followed on the termination of the Crimean War. In that year the total value of the foreign and colonial goods retained for con- sumption in this country amounted to £164,000,000, of which 64 was for articles of food, 82 for raw materials for manufacture, and 18 for manufactured articles.^ Last year, (1876) these amounts were a total of £319,000,000, of which 159 was for food, 119 raw materials, and 41 other; from which it will appear that 39 per cent, of the whole in the former year, and 50 per cent, in the latter, went for food. In making this separation of food from other articles it is not possible to be absolutely correct, for so many substances admit of a two-fold use. Take, for instance, olive oil, Avhich is actually used both as food and in manufactures ; or the fat of animals, which may appear on our table at meal-times for food or in the shape of candles to lighten its darkness. ^ Vide J). 72. 78 ON OUR INCI{EASING DEPENDENCE Again, it may be askocl wliat is food ? Meat and tobacco are totally different in their use or abuse, but both enter the mouth and arc tliere consumed ; both tlierefore are classed under this head, together with wines, spirits, &c. In the following table the figures for each successive year since 1856 are set forth in millions (to two decimals,) and placed alongside the ascertained population of the United Kingdom ; and as it would be unsafe to take for compari- son the amount of either in a single year, an average for the first and last three years has been worked out, showing that whilst the number of consumers had increased from 28f to 321 millions, the food furnished from abroad had advanced from 59 to 153, a growth of the one by 16, of the other by 160 per cent. This means that on an average each member of the community now consumes to the value of two and a half times as much foreign food as he did twenty years back, somewhere about £5 for £2. UPON FOREIGN SUITLIES FOR FOOD. 79 Table I. — Shuwiiig the Total Vulne of Food imported hctirecn 18o7 and \87(i, under the several heads of Animal and Cereal Food, Sugar, ^"c, and Beverages, Alcoholic, and other. [In million £'s to two decimals.] Years. Popula- tion. Total Value. Animal. Cereal. Sugar, Fruit, &c. Beverages. Miscel- Alcoholic. Other. laneous. 1857 28-19 64-00 7-60 20-51 18-52 5-68 5-63 6-06 '58 28-39 57-00 6-00 21-50 15-81 1-13 5-90 6-66 '59 28-59 56-00 6-77 18-24 14-83 3-69 6-59 5-88 '60 28-78 80-00 11-15 32-13 13-90 5-43 7-59 9-80 '61 28-97 82-00 12-46 35-94 15-62 5-07 7-25 5-66 '62 29-26 89-00 13-28 39-5 J 15-20 4-88 8-60 7-51 '63 29-43 79-00 14-01 26-99 1515 5-51 10-39 6-95 '64 29-63 79-00 16-96 20-92 18-94 6-63 8-56 6-99 '65 29-86 78-00 2005 21-28 15-30 4-96 8-83 7-58 '66 3008 91-00 20-40 31-00 14-86 6-45 1004 8-25 '67 30-33 101-00 17-28 42-67 16-31 7-78 9-20 7-76 '68 30-62 105-00 16-65 41-29 18-54 7-32 1083 10-37 '69 30-91 106-00 21-37 39-61 19-45 7-31 9-22 901 '70 31-21 100-00 20-.i8 34-39 20-37 7-63 9-17 806 '71 31-51 118-00 23-53 42-60 22-05 9-39 9-40 11-03 '72 31-84 136-00 22-27 52-89 28-04 9-15 10-71 12-94 '73 32-12 1-1700 28-41 52-69 27-06 10-75 10-64 17-45 '74 32-43 1 43-00 30-44 51-47 26-21 9-09 11-20 14-59 '75 32-75 157-00 34-14 54-7-1 27-34 9-48 13-26 18-04 '76 3309 15900 37-20 53-04 27-69 10-54 11-43 19-10 In 20 years 202700 380-35 733-43 391-19 137-90 184-44 199-69 Averages 30-40 101-35 19-02 36-67 19-56 6-90 9-22 9 98 1st 3 years 28-39 59-00 6-79 20-08 16-39 3-50 6-04 6-20 Last 3 years 32-75 15300 33-93 53-09 27-08 9-70 11-96 17-24 Increase percent. 16 160 403 165 62 184 101 174 1877 33-45 177-00 35-62 6.^-29 35-98 9-50 1300 17-61 '78 33-88 167-(I0 39 '.(8 60-11 29-15 7-84 12 08 17-84 '79 34-16 107-00 39-14 63-23 30-30 7-99 11-79 14-55 The further columns of this table subdivide the total values under the different heads of animal, cereal, and other vegetable food used in a solid state ; such as arc 80 ON OUIl INCREASING DEPENDENCE employed for beverage are divided into alcoholic, and non- alcoholic : with another column (partly estimated) of such as scarcely fall under either definition, or are not sufficiently distinguished in the official accounts to be assigned to their proper heads. Amongst these latter we have tobacco, spices, oil, &c., and also a class of articles which at first sight may appear most improperly placed — namely, guano, manure, &c. These, however, are mainly employed to stimulate the soil in its production of food, and therefore add to the supply just as much as they would if by their means the larger crops were raised for our use abroad instead of at home. Thus much of explanation is necessary to guard against undue conclusions being drawn from these figures, and it must also be remembered that as in the selection of food from other substances, so in this further separation complete certainty is not attainable ; but as in each year the same rule has been followed, the progress in each class may be truly traced. A few words on each heading may be desirable, reserving closer remarks till we come to deal with quantities. In none of the classes has the value risen to anything like the extent that it has in animal food, the average for the first three years being under 7, for the last three nearly 34 millions, fully five times as great as in the former. In this class there are included living animals, fresh and salted meat, fish and poultry, and their products, butter, cheese, eggs, lard, &c. The increase in price on live and fresh meat being neutralized by reductions in other descriptions renders the comparison between the two periods fair. Under the head of cereal produce is included every description of grain, flour, rice, and farinaceous substances generally, no distinction being made between that which is adapted for human as distinct from animal food. That which is consumed by oxen, sheep, and poultry is in fact but human food under another form ; but it would have been desirable, had it been possible, to have excluded at least so much as serves for the support of horses. Another UPON FOREIGN SUPPLIES FOR FOOD. 81 deduction also is requisite on account of the grain used for malting and distilling. The quantities thus employed cannot be ascertained, but an estimate is possible of the whole consumption for these purposes of home and foreign produce taken together, and since whatever of home growth is converted into beer or spirits has to be replaced by importations from abroad, it will not be unfair to deduct it all from the heading of cereal food, and add it to that of alcoholic beverage. The following table shows both quantity and value of the grain thus converted, and in addition those of sugar and molasses which are devoted to the same use. Table II. — Quantities and Value of Grain converted into Beer and Spirits, also of Sugar and Molasses. [Millions to two decimals.] Years. Grain. Value. Sugar and Molasses. Value. Cwts. £ Cwts. Jg 1857 25-60 10-88 •03 •05 '58 24-40 9-13 -06 •06 '59 25-90 9-20 -08 -07 '60 23-60 10-02 •u -12 '61 24-35 9-91 •34 •24 '62 23-62 7-36 •51 •30 '63 25-76 9-05 •31 •19 '64 28-61 9-55 •05 •05 '65 28-46 9-50 •08 •07 66 29-34 11-25 •22 •18 '67 26-77 12-19 •47 •45 '68 27-88 13-43 •47 •44 '69 30-07 11-55 -46 •47 '70 32-11 12-32 •34 •31 •71 30-11 11-74 •41 •42 '72 33-81 12-84 •56 -53 '73 35-31 13-77 •84 •84 '74 35-03 15-41 1-04 1-06 '75 35-41 14-87 1-01 1-04 '76 37-43 1310 1-08 1^01 583-57 227-07 8-47 7-90 Average 29-18 11-35 ■42 -40 The correction thus made under this head materially reduces the value of the cereal supplies, making the G 82 ON OUR INCREASING DEPENDENCE average of the first throe years to be 10*34 millions instead of 20"08 as shown in Table I., and that of the last three 38*61 instead of 53*07. The increase of one period over the other being 273 per cent, instead of 165 per cent. Next in order is the class of sugar, fruit, and vegetables, which are thrown together as being all of them vegetable products occupying a subsidiary place to that of the staple articles of bread and meat. A transfer from this head to that of alcoholic beverage, similar to that from the previous head, must also be made here, though not to anything like the same amount, for as yet the quantity of saccharine produce used in brewing and distilling is but small in comparison with that of grain. The two averages will be 16*33 millions instead of 16*39, and 25*59 instead of 26*63. The rate of increase 57 instead of 62. Sugar forms by far the larger amount of value under this head, and though the increase is less than with meat, it would have been some- what more than it is but for the extensive reduction in the price consequent upon the diminution first, and total aboli- tion of the duty afterwards. This is one of the articles, the consumption of which is likely to grow rapidly, and to continue at a low price. The vanous substances in use as beverage, whether imported in the liquid form fit for drinking, or as the materials to be subsequently prepared for consumption, admit of division into the two sub-classes of alcoholic and other liquors. Making the necessary transfers from cereals and sugar, we find that the first three years averaged 13*30 millions for the one and 6*04 for the other, whilst the last three show totals of 25*43 and 12*15 respectively, the in- crease upon the one having been 91 and the other 101 per cent. This, it must be remarked, does not represent either . the total or the comparative expenditure by the consumers of alcoholic as compared with non-intoxicating fluids, for the major part of the value assigned to the former is simply that of the raw material from which the liquor is prepared. This, in the case of spirits and beer, is a very small proper- UPON FOREIGN SUPPLIES FOR FOOD. 83 tion of the outlay, the chief cost being in the manufacture of the finished liquor, whilst tea, coffee, &c., require little or no expense to fit them for immediate use. Thus far we have been dealing with values only, and find that during the period of twenty years the total cost of our foreign food has been rather more than two thousand millions of pounds sterling, thus made up : — Cereals 506 millions. Average 2.5'3 Sugar and A^egetable Products 382 „ „ 19"I Animal Products 381 „ „ 19-05 Beverages — Alcoholic 374 „ „ 18*7 „ Non-alcoholic 185 „ ,, 9*25 IMiscellaneous 199 „ „ 9*95 2,027 „ „ 101-35 Or, if wo take the averages of the two triennial periods as the present and former consumption, we should say the expenditure is in round numbers, for — £ £ Cereals 39 millions, as aga Animal Products 34 „ Sugar, &c 26 „ Beverages — Alcoholic 25 „ „ Non-alcoholic 12 „ Miscellaneous 17 „ nst 10 formerly. 7 „ 17 „ 13 6 „ 6 153 59 The true measure, however, of our dependence upon foreign supplies is furnished by quantities rather than values. The principal ones are set forth in the following table, in which wheat is divided from other grain and from rice ; the living animals are reduced to their weight in meat, and added to the importations of that coming here either salted or fresh ; including also fish, but excluding poultry, the weight of which is not ascertained. Butter, cheese, and lard are separately shown, as also sugar and dried fruit (currants and raisins). These several articles 84 ON OUR INCIIEASING DEPENDENCE mako up tho bulk of the food, properly so called, received from abroad. Those used exclusively as beverages, find a place in a separate table, both being constructed upon the same plan as that relating to values ; and showing the results, as before, in millions to two places of decimals : — Table III. — Showing the Quantities of the principal Articles of Food. — Imports retained for Home Consumption, 1857-76. Animal. Cereals, &c.. &c. Other Vegetable's. Years. Meat. Butter, Cheese, and Lard. Wheat. Other Grain. Rice. Sugar and Molasses. Currants and Raisins. Cwts. Cwts. Cwts. Cwts. Cwts. Cwts. Cwts. 18.57 1-35 1-00 17-23 18-09 2-24 8-01 •44 '58 1-17 •86 2316 21-50 2-56 9-56 •64 '59 1-21 •92 21-43 18-99 •33 9-56 •78 '60 1-85 1-61 31-81 33-43 •35 9-33 •92 '61 1-81 2^01 36-26 27-90 1-61 10-26 -91 '62 2-46 2-21 49-95 25-86 2-65 10-49 •98 '63 2-99 2^20 30-74 30-25 1-46 1019 1-08 '64 3-31 2-04 28-74 19-31 1-53 10-24 103 '65 3-48 2^04 25-79 24-63 •57 11-17 109 '66 3-16 2^23 29-30 34-82 113 11-70 1-06 '67 2-55 2-27 38-88 27-79 1-76 1209 ]-07 '68 2 29 2-17 36-19 31-27 2-85 12-22 115 '69 3-22 2^45 44-36 36-83 3-74 12-47 1-15 '70 3-08 2^36 35-34 38-40 2-25 13-86 1-11 '71 3-96 2^93 43-31 40-59 2-37 13-86 1-23 '72 4-07 2-60 47-39 55-68 4-03 14-08 1-35 '73 5-48 3^15 50-53 44-32 3-33 15-35 1-23 '74 511 3^39 48^47 45-23 3-00 15-47 1-30 '75 5-69 3-55 59-45 49-51 3-48 17-91 1-25 '76 6-31 3-65 50-97 67-14 3-05 16-62 1-46 In 20 years. 64-55 45^64 749-30 691-54 44-26 244-44 21-23 Average 3-23 2-28 37-47 34-58 2-21 12-22 1-06 First 3 years. Last 3 years. 1-24 •93 20-61 19-53 1-71 9-04 •62 5-70 3-53 52-96 53-96 3-18 16-66 1-34 Increase percent. 360 280 157 176 86 84 116 32 5 1G3 8 S UrON FOREIGN SUrPLIES FOR FOOD. 85 Looking first at the animal food^ and especially at the meat, we shall see that the quantity now imported is very nearly five times as great as it was twenty years since, the exact increase being 360 per cent., and that this has been reached by tolerably steady progress. Each year^ with a few exceptions, has advanced upon its predecessor in an accelerated ratio, until now we have a total supply of more than 6 million cwts. which, if equally divided amongst all the inhabitants of the United Kingdom would give rather more than 21ilbs. per head per annum. Although not shown in the table, the proportion of live to dead meat was last year as G to 15, one which will be speedily altered if the importations now taking place from America are con- tinued. During the thi'ee months of this year already elapsed, the beef fresh or slightly salted has been 132,000 cwts., and meat preserved otherwise than by salting, 125,000 cwts., as against 24,000 cwts. and 38,000 cwts. in the same period of last yeai', more than quadrupling the amount. With butter, cheese, and lard, the growth has been equally continuous, though not so large. The increase is 280 per cent., or nearly four times, the total quantity at present being rather more than half the weight of meat — if equally divided 12 fibs, per head. Taking the two together the increase is 325 per cent., and the weight falling to the share of each individual about H-oz. per diem throughout the year. The bearing of these calculations will be seen further on when comparing the foreign supply with home ])roduce. But even this scarcely represents the full acces- sion to the stock of animal food for which we are indebted to foreign supplies, since a considerable portion of grain, notably barley, peas, and maize, as well as oil-cake, is employed in feeding home-raised cattle and pigs. We have seen that of the farinaceous articles imported last year some 37 out of 07 million cwts. are probably appro- priated to alcoholic production, either directly or to com- pensate for home produce so employed. The balance may 86 ON OUR INCREASING DEPENDENCE perhaps be equally divided between feeding for horses and meat-producing animals. To what extent, however, this may increase the home-grown animal food there are not sufficient data for determining. We may here notice the different rate of increase in the quantity and the value, 325 per cent, against 403, showing an advance in price on the whole equal to 19 per cent. Of the corn and grain, other than wheat, very little can be deemed directly available for human food, although most of it, as we have stated, virtually serves this purpose, and what does not, leaves the land at home free to grow that which does ; but rice, of which only a small quantity is used for distilling, may fairly be classed with wheat. Taking these two together, we find that the average of the first three years, 23 million cwts., has grown to 56 in the last, more than doubling the supply. This quantity, divided amongst the whole population, would • provide a daily al- lowance of rather more than half a pound weight of bread for each person. In this class of food the advance in price has been almost identical with that in quantity. The quantity of wheat shown in the table includes flour, of which 1 cwt. is reckoned equivalent to 1^ cwt. of wheat. The quantities of this and other descriptions of grain vary from time to time more than most articles — a necessary consequence of fluctuating yield in home produce and vary- ing harvests in the countries with which we deal. Dividing the twenty years into periods of five, we find the supply from abroad to have averaged per head : — . 11/3 9/9 11/10 10/10 1857-1876 132-52 10/11 How far this rate of increase results from greater popu- 1857-61 . . 97-73 lbs. Price per cwt. 1862-66 . . 119-71 „ i} 1867-71 . . 139-84 „ >3 1872-76 . . 173-01 „ f> UPON FOREIGN SUPPLIES FOR FOOD. 87 lation, combined with stationary or diminished home growth, will be seen when the two are considered together. Of the rice imported, some portion, perhaps a consider- able one, is employed for other purposes, such as the manu- facture of starch, &c., but the whole quantity 3*18 million cwts. is so small compared with that of wheat, that any allowance for these purposes, or for distillation, would but little affect the average. Coming then to the last class, sub-di\adcd into sugar and dried fruit, we find that the first average of 9"66 millions has grown into 18"00 in the latter, the increase of 86 per cent, being far lower than in the classes of animal food and of wheat. Of sugar, itself, after allowing for that converted into alcohol, the difference between the first and the last years of the series is that between 7 'OS and 15 "54, equal to 96 per cent. In value, the variation has been in a contrary direction, 14*41 having only grown to 17'09, or but 12 per cent., the difference of the two rates thus showing a fall in price equivalent to 40 per cent. The several articles thus enumerated constitute the bulk of the solid food imported, but there are two others, of some importance, included in the value table (though to save space not particularized in the quantity one), eggs under animal, and potatoes under vegetable. Of these we imported : — In 1857— Eggs 126-82 millions. Value -32 „ 1876— „ 753-36 „ „ 2-61 „ 1857— Potatoes -96 „ „ -18 „ 1876— „ 6-03 „ ,, 1-74 1 • 1 In the next table there are shown those articles which are imported in the liquid form, or are designed for use as beverage ; and one other, not belonging either to food or drink, but yet properly classed amongst those pertaining to the ordinary consumption of a large portion of the population. 88 ON OUR INCREASING DEPENDENCE Table IV. — Showing the quantities of the principal Imported articles retained for home use as Beverages ; also of Tobacco. — 1857-76. Alcoholic. Non- Alcoholic. Tobacco. Spirits. Wiues. Tea. Coffee. Cocoa. Gals. Gals. lbs. lbs. lbs. lbs. 1857 4-73 6-60 69-13 34-35 2-65 32-68 '58 4-58 6-27 73-20 35-21 2-86 33-92 '59 4-93 6-78 76-30 34-33 3-01 34-63 '60 5-52 6-72 76-82 35-50 3-23 35-23 '61 5-19 10-69 77-93 35-20 3-41 34-83 '62 5-19 9-76 78-79 34-45 3-62 35-42 '63 5-57 10-42 85-18 32-76 3-71 37-37 '64 6-30 11-40 88-60 31-36 3-86 38-01 '65 6-74 11-99 97-83 30-51 3-83 38-90 '66 7-80 13-24 102-27 30-63 4-05 40-50 *67 8-34 13-67 110-99 31-28 4-23 40-72 '68 8-40 15-06 106-82 30-36 5-11 40-98 '69 8-17 14-73 111-80 28-84 5-70 41-37 '70 8-44 15-08 117-55 30-23 6-15 41-37 '71 8-93 16-14 123-40 30-60 7-25 42-50 '72 9-07 16-77 127-66 31-17 7-79 43-68 '73 10-26 17-91 131-88 31-79 8-28 45-48 '74 10-68 17-17 137-28 31-26 8-85 46-58 '75 11-85 17-24 145-33 32-05 9-96 47-82 '76 11-55 18-66 149-13 33-34 10-43 48-57 In 20 years... 152-24 256-30 2087-89 645-22 107-98 800-56 Average 7-61 12-81 104-40 32-26 5-40 40-03 „ first 3 yrs. 4-75 6-55 72-88 34-63 2-84 33-74 „ last 3 „ 11-36 17-69 147-25 32-22 9-75 47-66 Increase per cent 140 170 102 —7 243 41 1 57 ■v . 71 We have already (Table II.) seen both quantity and value of the grain, &c., converted into alcoholic beverage, and in this table only deal with the spirits and wine imported in a completed state ; the amount of beer brought hither being quite inconsiderable, • not more than two to three thousand barrels a year. Taking wine and spirits together, the UPON FOREIGN SUPPLIES FOR FOOD. 89 growth since 1857 has been from 11*30 to 29"05 million gallons, or 157 per cent. That of spirits alone from 4*75 to 11'36, or 140 per cent.; and of wine from 6'55 to 17*69, or 170 per cent. The total value has risen from 3'50 to 9'93, or 184 per cent., not so great a difference as to render par- ticular observation necessary. Both have fallen in price, spirits more than wine, but wine being the dearer article and the one which has increased the most, has tended to raise the whole value. The class of non-intoxicating drinks, or rather the ma- terials from which they are derived, manifests on the whole an increase of 71 per cent. only. This arises mainly from the declining use of coffee, which is now actually 7 per cent, less than it was in 1857. Tea has increased 102 per cent., and cocoa 243, or together 107 per cent., considerably less than the alcoholic liquors have done. The average quan- tities in the first and last years having been : — Tea 72-88 and 147-25 CofTce 34-63 and 32-22 Cocoa 2-84 and 9 7 -J Comparing this increase of quantity with that of value, it appears that tea, by far the larger of three articles, has in- creased in weight almost in the same ratio as the whole has in cost, that is, in both instances almost exactly double. Of tobacco, the growth has been from 33*74 millions to 47*66, or 41 per cent., happily a less rate of progress than (excluding coffee) in any other article. Its price has not very materially altered, nor, being in its imported state a cheap article {8d. to Is. per lb. for the principal portion) , is its value sufficient to afi'ect greatly any calculations of our total imports. Yet as an indication of the tendency of the popular taste, it becomes no less important than it is to the revenue as one of our highly remunerative tax-pajring articles. II. In endeavouring to compare the extent of foreign supply with that furnished by home produce, it -will bo necessary to take a lesser range of years, since the infer- 90 ON OUR INCREASING DEPENDENCE mation of the earlier period embraced in the tables was not collected with the same detail as it now is^ but a fair com- parison can be drawn for the last ten years. In 1868 Mr. Caird thus calculated the average value of the agricultural produce of the United Kingdom, consumed annually : — Corn of all kinds £84,700,000 Beef and mutton 47,200,000 Butter and cheese 30,100,000 Potatoes 18,000,000 £180,000,000 The foreign supplies for the same articles he placed at £40,000,000, giving a proportion of one-fifth of the total supply. Since that period it is not probable that there has been much variation in the home produce, but the foreign supplies have increased 80 per cent. The average of the two columns, Animal and Cereal, in Table I., during the first ten years, gives £39'67, singularly near to Mr. Caird's esti- mate, and for the last ten years £71*78. This proportion agrees well for the total value of the food imports, which, as we have seen before, has, during twenty years, risen 160 per cent., or, assuming an even progress, 8 per cent, per annum. For the past year, however, these two classes give a total of £91,000,000, and if we add to this £2,000,000 for potatoes, we shall have £93,000,000 j rather more than half the estimate for home produce. On this showing we at present depend for corn, meat, and potatoes together, on foreign supplies for somewhat more than one-third the value of that we consume. Turning, however, to quantities, we descend into closer comparison as regards the two staple articles of bread and meat. In the following table a careful estimate has been made of the relative weights drawn from the two sources. Mr. Caird has kindly furnished me with estimates of the average produce of wheat per acre in this country for each year since 1867, and applying these to the number of acres UPON FOREIGN SUPPLIES FOR FOOD. 91 shown by the Agricultural Returns to be in cultivation, I arrive at the quantities given, averaging a growth of 54,000,000 cwts. Against this there is a foreign supply at the average of 45,000,000 ; but if wo take the foreign im- portations for the last three years we get an average of 53,000,000, from which it may be safely inferred that our bread is equally of home and foreign origin. Table V. — Quantities of Home -raised Wheat and Meat, compared with Foreign Imjwrtations, during the last ten years. [1877-9 addedJ] Wheat. JI -at. Years. Home. Foreign. Home. Foreign. Cwts. Cwts. Cwts. Cwts. 1867 40-65 38-88 25-22 2-55 '68 74-26 3619 24-61 2-29 '69 62-27 44-36 24-11 3-22 '70 65-22 35-34 2496 3-08 '71 53-62 43-31 25-37 3-96 '72 54-53 47-39 26-13 4-07 '73 44-77 50-53 26-23 5-48 '74 62-43 48-47 26-46 5-11 '75 42-12 59-45 2604 5-69 '76 43-99 51-06 25-87 6-31 543-86 454-98 25500 41-76 1877 37-27 62-54 25-63 6-24 '78 5;j*35 58-76 2500 6-99 '79 28-00? 70-32 24-00? 7-94 As regards meat, an eminent agriculturist, Mr. H. Thompson, in '' The Journal of the Royal Agricultural So- ciety," 1872, entered into an elaborate calculation of the annual produce of our flocks and herds. Applying his data, as to numbers and weight of those killed for this purpose, to the existing number in each year — as stated in the Board of Trade Returns, I obtain the weight given in the table, — averaging 25t million cwts. per annum. The weight thus derived is less than it would be were the data employed those on which Dr. Playfair founded his calculations in a 92 ON OUR INCREASING DEPENDENCE paper published in 1870 ; but as the object here is to compare the British and foreign supplies^ rather than to ascertain the actual amount^ and Mr. Thompson gives data for estimating both, it is safer to adopt his figures. For two reasons, however, it is probable that an addition should be made to the home weight, — the cattle are brought to market at an earlier age, and therefore the proportion slaughtered is greater, — and they are fed to an heavier weight. It will be right, too, to take into consideration the supply of fish which takes the place of meat. It may not, therefore, be incor- rect to set down the whole supply at 36 million cwt., of which one-sixth comes from abroad. In calculating their relative worth as " flesh formers '^ it is estimated by Dr. Play fair that the requisite daily allow- ance of albuminous material is three ounces per head, which for the year will be found in 480 lbs. of corn, or 550 lbs. of meat, that is 8 lbs. of meat will only go as far in support of the animal frame as 7 lbs. of corn. On this supposition our 30 million cwt. of fish and flesh is equivalent to about 2G of corn, and our 6j- millions of foreign to 5~. Of potatoes, Mr. Caird estimated the weight consumed in 1867 to be equal to that of bread, about 1 lb. daily for each person; but there were then 1,500,624 acres under crop, and now only 1,394,254. In converting wheat into flour there is a loss of one-fifth, and flour into bread a gain of one- third. This would give a consumption of 90 million cwts., but as compared with grain. Dr. Playfair estimates the feed- ing power to be but one-tenth, equal, therefore, to 9 millions cwts. of wheat for home, and half-a-million for foreign. Of other grain, some portion enters into the supply of human food, and so does rice ; but in the absence of any data on which to make calculation, I assume that these on either side follow the proportion of wheat, &c. Butter and cheese also enter largely into consumption, the home produce of the latter has been estimated to me by a good authority at 100,000 tons, and butter at half the cheese. The impor- tations of last year amounted to 75,000 tons of cheese and UPON FOREIGN SUrrLIES FOR FOOD. 93 81,000 of butter, together rather more than that of native manufacture. To sum up these several estimates for reducing the various descriptions of food to their equivalent in wheat, our con- sumption may be thus stated : — Home produce. Foreign supply. Wheat . . . .54 million cwts. 53 Meat, equal to . . 26 „ ,, 5^ Cheese and Butter = 3 „ „ 3 Potatoes . . . ^ 9 ,, ,, i 92 62 The conclusion thus arrived at would appear to be that for absolute sustenance we rely upon home and foreign produce in somewhere about the proportion of three to two- fifths. The articles which hold a secondary place as means of support are more foreign than British, and adding these to those of higher importance, it is probable that both in value and quantity, about one-half of our food is of foreign origin. One more calculation may be made. If the nutrition to be found in wheat is such that 480 lbs. suffices for a year's food, and in meat that 550 lbs. is necessary, then 53 million cwts. wheat will support 121 millions people. 6'r „ „ meat do. 1| „ „ 6 „ „ potatoes do. 5 „ „ 3 „ ,, butter and cheese 4- ,, 14^ Hence on this computation of the 33 millions of inhabitants in the United Kingdom, 18 millions may be sustained on food grown at home, and 15 on that received from abroad. The results obtained by these different processes, though 94 ON OUR INCREASING DEPENDENCE not identical, are sufficiently near to each other to justify the opinion that neither can he very far from the truth. If such be the case as it at present stands, the question arises what alterations are likely to take place in the future ? Our capacity for home production is by no means exhausted. If we were wise enough to retain the refuse which now pol- lutes our rivers and is lost in the ocean, the soil would yield larger returns. Higher cultivation and the reclamation of waste or imperfectly drained lands might add to the ave- rage under crops, and increase the fertility of that already so employed ; but we can scarcely expect any of these mea- sures to be extensively adopted. They are all dependent upon the cost, and every day^s experience seems to show that it is cheaper to bring from abroad than to force pro- duction at home. Were it even otherwise, should our country continue a prosperous one, the growing demands for space to build on, to plant for pleasure grounds, and to cover with roads, are likely to outstrip any additions which can be made. Neither can it be desired that we should be content with diminished or stationary supplies. The popu- lation ought, under the influence of sanitary regulations, and the spread of hygienic knowledge, to increase more rapidly than it has hitherto done, and to substitute meat food for alcoholic drink. From the combined influences of these several causes we must calculate upon an extended rather than a diminished demand upon the productions of other countries, and every year look to depend less upon our own resources. III. To be thus dependent upon extraneous sources for so large a portion of the national food may probably to some minds be the occasion of much anxiety, as rendering our very existence precarious, and as being derogatory to our national pride ; but provided our circumstances be such as to preclude it resulting in financial embarrassment, we shall find it to be in every respect advantageous, or at least to have so many benefits connected with it as to far outweigh any considerations of an opposite character. Leaving for the UrON FOREIGN SUITLIES FOR FOOD. 95 present the question of finance, it may not be out of place to briefly state some of the reasons why we should welcome rather than deprecate such a condition. In the first place, as a manufacturing nation, having some- thing to ofi'er in exchange for the products we require, it is a powerful inducement for other nations to become our cus- tomers. Large portions of the world as yet less civilized than our own, where labour is consequently cheaper than with us — having climates more suitable than that of Eng- land for producing the food we need — are enabled to raise wheat, to feed cattle, and to grow sugar on easier terms than we, and thus the whole world may, in one shape or an- other, become tributary to our necessities. With our com- mand of shipping, there need never be any real difficulty in transporting their produce to our shores, and the cost of conveyance, instead of being so much paid out of the coun- try, repays our own sailors and shipowners for the labour they bestow and the capital they employ. By this means we are brought into close and constant communication with various nations, to whom, but for the necessity for inter- course, we should remain strangers. From many of them we may learn much, and to many more we may be the in- struments, as we have been and now are, of conveying the knowledge of the arts and sciences, the blessings of civili- zation, and the truths of religion. There is nothing like extended intercommunication for enlarging the mind, sharpening the intellect, and warming the heart. For ourselves, confined as we are within a few degrees of climate and limited, so long as we maintained our insular isolation, to the vegetable and animal products of our own narrow sphere, it is something to have almost all the varie- ties of meat, fruit, and vegetables which the world brings forth, placed within our reach. Variety of food is no less beneficial to the health than pleasant to the taste and grati- fying to the sight. It is generally admitted that we owe most of our national vigour to the admixture of class and race, and when properly adjusted there can be little doubt 9G ON OUR INCREASING DEPENDENCE that a variety of food is conducive to bodily health and en- joyment. With the present search after appliances for the removal of perishable substances from one side of the ocean to the othor^ there is no saying to what extent this may be pursued, or that the most delicate products will not ere long be capable of being transported hither from the very ends of the world. If meat can bo brought from America, in such perfect preservation as that which is now arriving daily, the game, the fish, the fruit, the vegetables of every clime may be furnished to our tables. New markets being thus found for the superabundance of other people, we shall also find new openings for the sale of our manufactures. The natural advantages of more favoured countries will thus be shared with us, and the acquired comforts which we possess may be participated in far more largely than they otherwise would be by those who are separated from us by the longest distances. Again, nothing is more likely to prevent war than the mutual dependence of one nation not on another only, but upon all others. Where commercial relations exist, and friendships arise, there will ever be a desire for the peaceful settlement of all differences ; and in this respect, the nation which is the strongest, whether it be in money, in manufac- turing skill, or in productive power, will always have more depending upon it than it has upon others. The larger the sphere over which its operations extend, the less the pro- bability of any one country being able to interfere with its dealings with others. It would be very easy and pleasant to enlarge greatly on this head, but to pursue it further would unduly extend the limits of this paper. We proceed therefore to the last topic with which I propose to tax your attention. lY. There remain for consideration, then, the financial relations of this country with the rest of the world, resulting from this importation of food. During the past year (1876) the value of goods of foreign origin retained for use in this country was, as shown in the ofiicial returns, £319,000,000 ; UPON FOREIGN SUPPLIES FOR FOOD. 97 and that of the produce of this country's growth and manu- facture exported from hence £200,000,000, showing an ap- parent excess of imports to the extent of £119,000,000. Certain revisions of these figures have, however, to be made, such as allowances for freight, &c., &c., which justify the assumption that the realexces.s of imports for which we have in some way or other to make provision is somewhere about £75,000,000. The connection between this balance and the food question will be best seen by an examination of the figures for the last ten years. The original values are de- rived from the publications issued from the Custom House and Board of Trade, representing the worth of the foreign goods retained for home use at the time of their arrival in this country; and in like manner of the British exports at the time of their departure. The revised figures do not in any way conflict with the official. They are an estimate of my own, based upon reasons on which it is not necessary here to enter, but which will bo found fully detailed in a preceding paper. They are presumed to represent the cost to this country of the goods it receives, and of those with which it parts ; the difference between the two being the amounts which have to be met by actual payments in money, or by a set ofi" in the adjustment of accounts between this nation and those with which it trades. The sums are shown in millions of pounds only. 5C 00 1 i o 00 00 00 CO 187-1. 1875. » Original Values. Imports £ 230 181 £ 247 180 £ 248 190 £ 259 200 £ 271 223 £ 296 256 £ 315 255 £ 310 £ £ 319 201 Exports 240 224 1 Excess of former 49 67 58 221 196 59 231 207 48 2-in 230 40 263 266 60 281 267 72 1 92 118 Revised Kstimate. Imports •205 188 220 187 278 •>51 281 284 Exports 209 Balance 17 33 25 24 10 —3 14 27 ^R 75 98 ON OUR INCREASING DEPENDENCE The total of these balances gives an average of 27 mil- lions a year, but the steadiness and rapidity with which they have latterly grown forbids the expectation that so small an amount is all that will have henceforth to be provided for. Judging by the indications the trade of the past quarter affords, a further increase of 25 millions on that of last year is by no means unlikely. Be it, however, 75 or 100 mil- lions, the sum is so large that it may well excite uneasiness as to how it is to be met. The connection of this with the outlay for food is obvious. It is evident that this country, not being one in which the precious metals are found, can- not pay for its purchases in gold or silver ; it may do so for a limited period by suffering a drain upon the bullion pre- viously accumulated, but this has not been the case hitherto. Out of the past twenty years there have been only three in which the import of bullion has not exceeded the export, the average rate of addition to our stock having been five millions per annum, a quantity not more than requisite to meet the extensions of our circulation and the absorption in the arts and manufactures. This year, from the fulness of our cofiers, and the diminution of our exports of goods, is likely to be one in which some considerable amount of treasure may be sent away. The other som'ces from which the country may derive the means of meeting its obligations are two-fold — the dividends or interest of capital lent or accumulated abroad, and the profits or earnings remitted to this country for use or investment. Of neither is it easy to estimate the amount, nor, however valuable or interesting such information would be, is it necessary for the present argument, which is, that it cannot be increasing in the ratio of our liabilities. We have but to note the defaults of the nations to whom we have lent largely, to see that the stream from the first source is not enlarging ; and to listen to the universal chorus of complaints as to the diminished profits of trade abroad to understand that the flow from the second source must be lessening. I am quite aware that it is now a received axiom UPON FOREIGN SUPPLIES FOR FOOD. 99 in the science of political economy that a prosperous coun- try should import more than it exports, otherwise its trade cannot be profitable; but we are not simply traders sending out so much to sell at a profit, and with the proceeds to pur- chase that which will be of greater value when it reaches our shores than when it left the place from whence it came. We are capitalists also, investing our means in foreign countries to which we can only remit them in the shape of goods exported, or by suffering the profits accruing abroad to remain for employment there instead of at home. AVereall our capital absorbed in investments here, the excess of im- ports of goods and bullion would represent the gains of trade, })ut scattered as our capital is all over the world, the excess may anse either from increased income accruing abroad or from capital withdrawn from foreign uses. Another expla- nation may be offered, and probably this is the right one, that in the five years in which our exports were the largest, 1871-75, we were lending or had lent largely to foreign nations, and that those loans were remitted partly in goods — money we did not send — whilst a large portion never went out at all, being absorbed in commissions, &c., by operators at home. But if so, what does this prove ? That the trading and manufacturing prosperity of those years were at the expense, not so much of the foreigners who bought our goods, as of our capitalists at home who lent the money with which they were paid for, and that to revive our trade we must resort again to reckless lending. In whatever light, therefore, we may view those growing balances, it would seem to be sound policy — it may shortly become absolutely unavoidable — that we should seek to re- duce them in one or both of two ways, by buying less or by selling more. It is with the former of these expedients we have to deal in relation to our present inquiry, yet a few- words on the latter way may not afterwards be out of place. The following figures for the same period will sliow tlio proportion of the above total imports, which nri' due to 100 ON OUR INCREASING DEPENDENCE articles for food, raw materials for manufacture, and other articles respectively : — 1 00 2 00 00 1871. 1872. 00 ui 50 00 Food Raw Materials Manufactures £ 101 100 29 £ 105 110 b2 £ 106 108 34 £ j £ £ 100 118 136 119 117 125 40 36 35 £ 147 133 35 £ 143 130 39 £ 157 118 41 £ 159 119 41 1 "' 315 1 312 470 450 Total Values Percentage of Food .... 230 440 247 43° 248 43" 259 271 -296 39°, 44'' 46" 316 50" 319 50» Percentage of Food j to Raw Materials. 1 101 95 98 84 101 109 111 110 133 134 An examination of this table will show that of 319 mil- lions worth of imports for last year 159 were for food, 119 for raw materials, and 41 for manufactured and miscel- laneous articles, and that of these the past ten years^ growth has been the most rapid in articles for food. We must not wish for any reduction in the supply of raw materials, lest thereby we reduce also the manufactures we have to sell. Of manufactured articles we may somewhat curtail the sup- ply from abroad by reverting to a less extravagant style of living, but even then we shall lose in the customers from whom we take them. In food, as we have already seen, there is no probability that we can do without the staple articles of which our imports are largely composed, but in one branch we may, and 1 believe we must retrench, that is in our consumption of alcoholic liquors, both those which are imported as such, and those which are manufactured from grain, whether imported or of home growth. Referring back to Table I. we shall see that the value of alcoholic beverages imported last year amounted to £11,230,000, and in Table II, that grain to the value of £13,100,000, with sugar and molasses to the value of £1,010,000 were converted into beer and spirits, gh'ing a total of more than twenty-five millions of money. This it UPON FOREIGN SUrPLIES FOR FOOD. 101 must be remembered is not the expense to the consumer, that is something far beyond ; but the simple cost to the nation of the materials of which its " drink " is composed, and just in proportion as the use of alcohol is lessened may this charge upon its resources be diminished, or, what would be far better, devoted to productive uses. Of food proper, that which nourishes life and creates the force, which, rightly employed, produces the manufactures with which to purchase food, we cannot have too much ; but whatever opinions may be held as to the use of alcoholic liquors at all, it is undeniable that the greater portion of our consumption goes to impair life, health, strength, and thus to curtail the productions we need to exchange for our food. Nor is this all, it exhausts our resources in pro- viding for repression of crime and the relief of destitution, — it diverts from profitable employment the time, thought, talent, on the right use of which our national prosperity depends ; and by debasing the character, and destroying the skill of our workers in all ranks, it unfairly weights ua in the race of competition with countries where temperance is the rule and intemperance the exception. If it be thought that I dwell unduly upon this point, I do so from the thorough conviction that it is to a radical reform in our national ideas and habits in this respect that we must look for a revival or maintenance of our manufacturing and trading prosperity. Something further than this is, however, necessary. Wo must not only utilize our food supplies by converting them, through the bodily and mental power they maintain, into products wherewith we may trade with other nations ; but must seek, as well, to enlarge the sphere of our mercantile operations. At present it would seem as if our produce and manufiictures had exceeded the wants of the world, or at least its power to pay for them, and it is of little use to manufacture more if customers are not forthcoming. This evil can only bo met by opening up new markets, l)y send- ing forth our brains and our bullion to find emj)l()yinen.t in 102 DErENDENCE UPON FOREIGN SUPPLIES FOR FOOD. places, such as those in Africa, where there are lands of surpassing fertility, rich in vegetable and mineral wealth. These countries are teeming with peoples, wanting but our help to raise them from the degradation in which they are sunk to the level at least of such civilization as may create the wants which we have the power to supply, and enable them in return to bring forth the food and other com- modities which our growing population and increasing desires may enable us to consume. Let us as a nation be- come thrifty and temperate ; cherish the character for honesty and justice which the greed of gain has gone far to destroy, and there are untold stores of wealth ready to be brought to our shores. There are unnumbered blessings ready to be poured out upon us, if we will be but true to our creed ; and whilst not unmindful of the advantage to our- selves, strive to cultivate higher aims in colonizing, civi- lizing, and Christianizing the lands and people which geo- graphical discovery and scientific research are daily bringing within our reach. V. The Nature and Extent of our Foreign Food Supplies, AND THE Sources from whence they are Derived.' THE latest published official returns of the trade of the United Kingdom show the total value of the imports during last year to have been very little short of £394 millions, that of the preceding year having been a trifle over 375. Looking back for a period of twenty years, it vnll be seen that in 1857 the value was £188 millions. Of this amount £24 millions was exported, thus leaving 164 for consumption or manufacture at home. The proportion thus taken away in 1877 is not yet ascertained, but that of 1876 having been rather more than £56 millions, that of last year may, allowing for the slackness of trade, be safely esti- mated at 53, which would leave the value retained in the country at £341 millions, being £22 millions beyond that of 1876, and more than double that of 1857. The goods thus allowed for as re-exported are only those which leave the country in an unaltered state, having simply come to it as a market from whence other nations draw their supplies. Dr. Forbes Watson, in a very interesting paper recently read before the Colonial Institute, has carried this deduction a step farther, and reasoning from reliable data, estimates that in 1876 foreign raw material to the value of £58 millions was worked up into goods which, having undergone manufacture here, were exported as British. Applying ' Siippli'iuent to the " Statist,'' March 23rd, 1878, and "Jouniul of Statistical Society," June, 1878. 104 THE NATURE AND EXTENT OF the same method of calculation to the exports of 1857, we may assume that the value of foreign goods thus dealt with would then have been £36 millions. Again, dealing with the figures for 1877 in the same manner, we may assume that in addition to the foreign goods exported in their original condition there were those converted into }3ritish manufactures of the value of £56 millions. The comparison between the two periods will stand thus : — [000,000's omitted.] Foreign and Colonial Goods Imported 1857. 1877. .£188 ... £394 Exported unchanged 24 Exported worked up 3G 53 56 60 109 Ketained and consumed at home £l28 £285 Such being the full value of the goods for which we are indebted to foreign producers, the portion in each of these years which consisted of food has been shown in the previous paper, in which the growth of consumption and population were compared. Without pretending to very strict accuracy of detail, the total values of the first and last year in the series may be thus subdivided : — [000,000's omitted.] 1857. Animal £8 Cereal 10 Sugar and other Vegetables 18 Beverages — Alcoholic 16 —Other 6 ^Miscellaneous 6 £64 1877. £36 52 36 23 13 n £177 The extreme importance of these figures, and the great disparity between those of the two periods, become more OUR FOKEIGN FOOD SUPPLIES. 105 apparent when brout^ht into juxtaposition with the value of goods exported at the same dates ; thus : — [000,000"s omitted.] 1857. 1877. British Produce and Manufacture £l22 ... £199 Deduct Foreign Material in tlieiu 3() ... 56 £S6 ... £143 f'oreign Food Consumed 64 ... 177 Other Foreign Goods retained 64 ... 108 £128 £285 In the former year we exported, as the produce of Briti.sh labour and capital, £86 millions, to meet an import of food to the extent of £64, an excess of £22. In the latter, £143, to meet £177, a deficiency of £34 millions. Although for the purpose of comparing one description of food with another and the several years one with the other, as well as for viewing the whole subject in its financial bearings, it is necessary to express the whole in money value, the true measure of our dependence upon foreign supplies is, since the prices vary so much from time to time, best fur- nished by quantities rather than cost. The staple articles obtained from abroad were fully shown in the tables of the preceding paper (pp. 84, 88) . The Sources of Supply. Coming now to consider the sources from whence these supplies are derived, and following the same subdivision of articles under the principal heads into which the various descriptions of food may be conveniently divided, the table hero given will show the value of each kind which we received from the diflcront countries to whom we are customers for the year 1870. The several totals vr[\\ not altogether agree with those of the former totals, because in both many small items fail to be included and get sunk 106 THE NATURE AND EXTENT OF among the miscollanoous. Neither is it possible to deduct from each country the amount of its produce which is re-exported. This, however, is of little importance, the ohject being not altogether to see how much from each pro- ducing country we keep to supply our wants, but how much there is available if we should wish to keep it. The miscel- laneous items not being shown here, the comparison must be with the total of the first of the tables already referred to, less those there included; and deducting 18"42 from 159'00, we have 141 '58, an almost identical total with that of 141*29 arrived at in the latter table after deducting from the full value of the goods re-exported the whole amount stated as imported. The totals of the different kinds come suffi- ciently near to the former ones to establish the substantial accuracy of each compilation. OUR FOREIGN FOOD SUPPLIES. 107 Table showing the Countries from irhich the specified Articles of Food Imported in 1876 were obtained, with the respective values of each class. [In million £'s to two decimaliij Countries. Russia Sweden Norway Denmark Germany H..llan) 14 1874 >) 72 }) 27 1875 }) 92 >) 48 1876 )) 118 }) 75 1877 „ 112 „ 97 We thus arrive at the conclusion that, supposing all tho goods imported were paid for on their arrival here, and all those exported exchanged for money at the time of exporta- tion, the cash balance which in 1872 would have been £3,000,000 in our favour, was in 1877 £97,000,000 against us; and that so much money or money's worth has to bo 144 EXCESS OF IMPORTS AND provided from some source or other out of tlio country, for if we add the bullion and specie it would not materially alter the figures. In 1872 the excess would be about £700,000 more ; in the four next years the figures are respectively b, 2, 6, and 8 millions of increase, and in 1877 they show 2 millions of pounds less. These are not serious amounts, but deserve to be stated for the sake of accuracy. The figures thus assumed as showing the balances which have had to be provided for are not put forward with any pretension to absolute accuracy, although they are believed to fairly represent the actual results of each yearns trade, and the calculations on which they are based having been some time before the statisticians of the country have not been impugned. It follows then, we repeat, that in 1872 this balance was in favour of the exports by about £3,000,000, but that it had turned against us in 1877 to the extent of £97,000,000, the intervening years also showing an excess of imports of 14, 27, 48, and 75 millions respec- tively. These are the sums which, after setting ofi" the whole value of the goods we have sold out of the country against those we have bought into it, remain to be paid or adjusted with our co-traders and producers abroad ; and the subjects for inquiry are in what way these claims have been liquidated, how they are to be met in future years, and what effects they indicate or are likely to produce upon our national prosperity. On these points the greatest difference of opinion prevails, arising from the difiiculty there is in dis- entangling in very complicated business transactions the one detail from the other, and the greatest confusion of ideas exists for want of attention to the several relations subsisting between this country and the rest of the world. Now there are but three sources from which the above- specified obligations can be discharged : the transmission of bullion, the diversion of income accruing abroad, or the ab- sorption of capital invested and debts owing to us in other countries. The first method has certainly not been adopted, for the DEPKESSION OF TRADE. 145 balance of bullion and specie transmitted is very inconsider- ablCj and only in the first and last of the years of which we are speaking have they been on the export side. If we include these figures, the" balances will be changed to 3'6, 18"5, 28"5, 54"2, 83', and 9o* millions of pounds sterling. The main source of supply is doubtless the income arising or accruing abroad, which is in fact remitted here in goods rather than in money, and, so far as this goes, the higher the amount it may reach, the greater the prosperity it evidences. \V^hatever it may be, it is won for the country, by the labour, the intellect, and the capital operating beyond our own shores ; whether of those actually living abroad, or of those directing and supporting such operations by their talent and their credit whilst remaining at home. What the whole of such income may be, it is perhaps impossible to ascertain. Such an investigation would expand this paper far beyond the limits of space within which it must be con- fined. All that can be here done is bi-icfly to mention the various channels through which it may flow. There are, first, the profits derived from the purchase and sale of goods abroad on account of those residing at homo and those who remit such gains to this country. Whatever is spent or invested before it comes here clearly cannot bo applied in payment for goods sent here, neither can any in- crease of price obtained after they an"ivc be so applied without its forming part of the goods or bullion sent away; and both these values have been already applied to prevent the balance accruing. The difference between the price paid for wheat or sugar in the countries of produce and that which the article fetches on arrival here is so much to the good as against the balance only when it is retained here, and not when it has to be remitted to the sender. In like manner, the difference between the sum paid for goods shipped outwards, and that they may realize on arriving at their destination is only to the credit of this country when it is received by the shipper here. On what may be bought or sold here on behalf of speculators abroad, commission L 140 EXCESS OF IMPORTS AND and interest on advances are all that accrue. Probably this, at any rate in depressed times like the present, is a surer and better return than the profit made in the trading; and considering the large proportion of business which is done on commission, five per cent, on the total imports will be an ample estimate. Commission obtained on the exports must not be reckoned, having been already included in the value. Next to these, there must be a considerable sum derived from the salaries and earnings of employes and labourers in foreign countries, the surplus of which comes to this country for the support of their families and for investment. Again, there will be the net earnings of British shipping on that portion of the work they do which is paid for abroad. That portion which is paid at home constitutes a charge on the imports after, and on exports 'before, their valuation, and consequently does not enter into the account. Then we have the remittances from the Indian Govern- ment in repayment of moneys expended on its account in England ; also the dividends on foreign loans, including commission on their raising and management at home; and the profits on manufacturing operations for which the capital and some of the working expenses are provided here. In short, whatever income may be receivable in this country from any source out of it will come here in the shape of goods, oftentimes not directly, but in the end, in the ultimate settlement of accounts between indi\aduals and nations ; and, if it be equivalent to the balance which has to be provided, the magnitude of our imports is a cause for congratulation — a proof of wealth and prosperity. Against these items, however, must be set ofiF the value of whatever goods we send abroad, the proceeds of which are not actually realized in this country. If we lend money to foreigners, invest it in commercial or manufacturing concerns abroad, or send out machinery and plant to be worked, not paid for, it will all appear in the shape of ex- ports, which have been already set ofi" against the imports. DEPRESSION OF TRADE. 147 There is no doubt that in the earlier years of the period em- braced in the figures of which we are treating^ the exports were swollen largely by the foreign loans and investments we were then embarking in, and that now these are not being repeated ; but it is well known that English capital is still being invested in trading, agricultural, manufacturing, and mining concerns abroad. All this must be either so much diverted from remittances homo or be transported abroad in the shape of goods. The simple enumeration of the various sources — actual, probable, possible — from which the means may be obtained of liquidating the cost of our imports is sufficient to show how very uncertain any estimate of their total produce must be. Yet the question is of the utmost importance, for on its answer depends whether we are indeed only arrested in our national prosperity — simply ceasing to accumulate our savings — or are actually parting with our investments in other lands. Mr. Rathbone, M.P., and other writers boldly assert that we are doing the latter, and even cautious autho- rities are ready to admit the probability that wo are reducing the amount in which the world is indebted to ourselves. For this is the only remaining ivay in ivhich our ohligations can he discharged. Nor are there wanting indications that the case really stands in that way. No one of any weight seriously asserts that our foreign income, great as it may be, is equal to 80 heavy a demand. The public are known to have become distrustful of many foreign securities ; and the ple- thora of unemployed capital enhances the price of those that are of undoubted stability, so that seekers for high-paying stocks or shares are fain to hold back for better times. ]Jut whatever be the true state of the case as regards our power to pay without withdrawing capital from paying in- vestments or occupations, it is perfectly clear that wo must now be worse off l)y a hundred millions — unless indeed it can be shown that our income has grown to that extent since 1872 — and, moreover, the figures are very suggestive of a further decline. The descent has been constant, 17, 13, 21, 148 EXCESS OF IMPORTS AND 27, and 22 millions in successive years, without any prospect yet that the downward limit has been reached. The amounts in the last published account show that December improved slightly over the same month of last year in the exports, but there is nothing like so great an increase as is shown in the imports. Looking forward to the future, it wall be well now to con- sider whether there is a probability of an improvement set- ting in. As regards an increase of income from our present investments abroad, there is little room for hope. The borrowing States which have proved defaulters, either in whole or part, seem more likely to become utterly bank- rupt than to be able to pay up the lapsed dividends. Some of the public undertakings, such as railways, &c., may possibly improve in their dividends, but others will pro- bably fall off; so that the total yield is not likely to be greater than hitherto. There is more hope that the recent invest- ments in private undertakings, manufacturing and mining, may give better returns ; but the incomes derived from trade, besides the fact that the return is not so lucrative as before, manifest a growing tendency to fall into the hands of permanent residents abroad. With the extension of capital, of experience, and of intelligence on the part of those who in their own countries devote themselves to these pursuits, a greater proportion of the business transacted falls into their hands, and less comes to the share of those who remit the surplus profits home. Then economical con- siderations are reducing the salaries of officials and the gains of professional men, part of which they were in the habit of sending home. Even shipping, which is now in so depressed a condition, will probably become owned to a greater extent by foreigners, although with the growth of commerce it is not improbable that we, who have been for so long the masters of the seas, may still monopolize the greater share of the carrying trade, and may perform it on more remunerative rates. Thus the conclusion is that there is no well grounded expectations of a speedy enlargement of the DEPRESSION OF TRADE. 149 sources from which the claims upon us can be met from foreign receipts. Can we, in the next place, hope to increase our exports ? It is often asserted that the diminished value of these arises from the fall in price rather than in quantity. Let us take the three great branches of exporting industry, which to- gether contributed last year 110 millions out of the 199 millions of total exports. In 1872 we exported Cotton 3,.';37 inilliun vanls, in 1877, 3,8;36. „ „ Iron 3,383 „ tons, „ 2,34o. „ „ Woollens 412 „ yards, „ 262. It thus appears that iron has actually fallen off 77 per cent, and woollen goods 58 per cent. ; although cottons have in- creased 8 per cent. Thus extraordinarily low prices, such as really leave but little if any room for profit on the manu- facture, have failed really to stimulate demand; though it is well understood that a large portion of the shipments are owing to the reduction in price, but for which they would not have taken place at all. The truth seems to be that supply has outstripped demand. The extraordinary sales of 1871-3 raised expectations which led to a vast increase in the means of production at home, and prompted the creation of such means in other countries, whose competi- tion forces down prices to the detriment of ourselves and them. It is the fashion in some quarters to decry foreign competition and to point to the failure of works carried on in other countries to realize profitable returns, but the reality of such competition is too well known to those who are best informed. The foreigners have had to struggle witli all the difficulties incideifb to starting in new under- takings, we have had all the advantages of long established concerns ; and yet the lower cost at which labour can bo ]irocurcd assures that under present conditions they will first feel the benefit of a revived demand whenever such shall arrive. So long as coal and iron were more acces- fiible to us at homo than thuse abroad, we might bo said to be masters of the situation. These we no longer retain in 150 EXCESS OF IMPORTS AND almost exclusive possession, and our manufacturing popula- tion feels the result in diminished wages and shorter hours. This question of foreign competition is worthy of the closest investigation. It has recently been asserted* that compared with our home trade^ the foreign is of so little importance that its extinction would be borne without much injury. To support this opinion it is alleged that after deducting the cost of raw material imported and used in the manufacture of the £200,000,000 of value exported, there may be left at the most £140,000,000 of income derived from our foreign trade, whilst the aggregate income of the country is estimated at £1,200,000,000; and supposing some other use to be made of the machines and tools now employed in producing what we send to foreigners, — were the whole of our foreign custom to be lost, — it would not deprive us of more than a tenth or twelfth of our whole income. The estimate of 1,200 millions sterling is amved at by considering that the gross annual value charged to the Income Tax being 500 millions, to which another hundred millions may be added for exemptions and incomes under Schedule D, which escape payment, " the net in- comes of the Income Tax paying classes,^^ it is said, " must be somewhere about 600 millions sterling," and it is added that " the incomes of the wage-receiving and non- paying section can hardly be taken as less than another 600 millions.^' Is it, however, correct to take assessment to the income tax as a basis, seeing that the same income is charged over and over again as it passes through difiFerent hands ? It is charged at its first inception and at many of its subsequent distributions, and hence arises one very cogent argument against the fairness of the tax at all. This may be illustrated by supposing the case of two individuals deriving incomes of equal amounts, either from the cultivation of the soil, investments in the funds, or from the profits of any manufacture. Each pays the same amount of tax. The one spends all in the maintenance of his ' " Times," 19th Nov., 1877, "Foreign Competition." DEPRESSION OF TIJADE. 151 family at home and the employment of labom* on liia estate. The other pays a clergyman to teach the adults on his property^ a schoolmaster to teach the children, he sends his daughters to school and educates his sons for a profession, and the amounts he pays for each of these objects on passing into the hands of other persons are again assessed, being reckoned in their respective incomes. Again, all these per- sons pay the butcher and the baker, the physician and the lawyer, and in every one of these cases another charge is raised. Yet all the while the total income, so far as the country is concerned, remains actually the same. Indeed, the incomes of the wage-receiving classes become indirectly as- sessed, for their earnings pass into the hands of the tradesmen with whom they deal, whose profits become chargeable. The error consists in supposing that the aggregate of indivi- dual incomes and the income of the country are one and the same. That only is true income which is created, and none of those who are non-producers adds anything to the national income, although they may have to contribute to its taxes. They are simply agents in this sense of distributing that which has been. produced by others. But a still gi-aver eiTor exists in the supposition that any amount of money passing between individuals at home can have any effect upon that which is required for transmission abroad. In relation to the rest of the world our only income is that which we have power to spend -u-ith it. So long as A fattens sheep and B weaves cloth, they may \vith advantage exchange their respective produce, but neither is one step nearer to obtaining the sugar or the fur he requires from abroad. If the producer of these will not take the wool of the one or the cloth of the other, both A and B must go without. Nor is the real nature of the transaction at all altered because C and D come between them, buying from the one and selling to the other. Let the money, which is simply the medium of exchange, bo but sent out of the country to pay the sugar-pluuter in Jamaica or the hunter in North America, and neither A 152 EXCESS OF IMPORTS AND nor B will long have any. Suppose the l-iO millions as- sumed to be the profits of our foreign trade to he lost, then we should necessarily have by so much to reduce our im- ports, for if we attempted to pay for them in bullion, national bankruptcy must speedily ensue. Do away with our foreign trade, or let it be taken from us by foreign competition, and we must be content to exist only on that which we can raise within our home boundaries, excepting always that which our investments and earnings abroad provide the means of paying for. This brings us to the consideration of what probability there may be of our being able to lessen the extent of our imports, the value of which for each of the last six years has already been given. An analysis of these figures in one of the papers already alluded to ' shows the following dis- tribution under the various headings of Food, Raw Material, and Manufactured Goods in million pounds sterling for the ten years, 1867-76. Food. Eaw Material. Manufactured Material. Total. 1867 101 100 29 230 '68 105 110 32 247 '69 106 108 34 248 '70 100 119 40 259 '71 118 117 36 271 '72 136 125 3.5 296 '73 147 133 35 315 '74 143 130 39 312 '75 157 118 41 316 '76 159 119 41 319 The returns for 1877 are not yet completed, when they are it will probably be found that the whole increase of 22 millions has been on articles of food. If so, the growth of consumption during these last ten years has been 80 per cent, on food, 20 per cent, on raw materials, and 40 per cent, on ' Manchester Statistical Trausactions. DEPRESSION OF TRADE. 153 manufactured articles; and that our present demands in these ways require 180, 120, and 40 millions respectively. It will be observed that the increase has been least in the raw materials used in manufacture, which fact corresponds with the falling off of our exports, the bulk of which are manufactured out of imported material. These scarcely admit of reduction unless our manufacturing industries are to be still further crippled, which would imply, as is already apparent, a diminished power of purchase on the part of our artisans and labourers. Neither can we wish any material reduction in manufactured articles, excepting in so far aa those of foreign manufacture are superseding the work of our own operatives. It is to be feared that a considerable portion of the increase is due to this cause. We may be well content to avail ourselves of the skill and industry of other nations in rendering natural products fit for use or ornament, so long as we can persuade them to take the works of our hands in exchange ; but surely foreign compe- tition is to be dreaded when it is directed against our own manufactures. Nor would any well-wisher of our own people desire to sec any diminution in the supplies of food, but rather he would seek a constant addition to the quantity, excepting indeed in the case of those articles falling under this head which minister to the national vice of intemperance. These, for 1876, are valued in the paper we have quoted from at £1 1,000,000 of imports in the form of drink, and £ 14,000,000 for the materials converted in our own brewencs and dis- tilleries. Amounts such as these under this head, even if saved, as is to be hoped, will only for a short time prevail in the face of the larger increase which must arise in neces- sary articles of food for our over-increasing population. It is calculated that though we have 3'3 million inhaliitant.s in the United Kingdom, the home growth of food is only suf- ficient to maintain 18 millions, leaving 15 millions of our people dependent on foreign supplies. The natural increase of pojiulation is not quite ouo per cent, per annum, far less 154 EXCESS OF IMPOliTS AND than it should be if life and health were properly cared for ; but at this rate we have every year from a quarter to one- third of a million more to provide for. We are not increas- ing in home growth of food, and therefore the whole supply for this addition to population must come from abroad. This alone ^vill require an annual addition on our imports to the value of from 3 to 4 millions, sufficient in a very few years to swallow up any savings from the abandonment of useless or vicious expenditure in food. From all these and some other considerations we are forced to the conclusion before stated, namely, that we need to have an income drawn from sources entirely outside the United Kingdom of at least 100 millions sterling per annum to pay our way with the other nations of the world, and that, un- less there be some radical amendment or alteration in our trading and manufacturing condition, there is no prospect for some time to come of this necessity being lessened. To this point, then, it will be well that those who have the means of investigating or discovering the real amount of the world's annual indebtedness to this country should apply their researches. If our receipts in that way be just the 100 millions, we are consuming it all in food, to say nothing of other perishable purchases, leaving nothing for saving or accumulation. If the sum exceed that amount we may be adding to our investments in other countries, and so pro- viding for the growing enlargement of demands on our foreign resources by as much as the excess may be. But if, on the other hand, the receipts fall short of the sum named, we must be calling in our credits, parting with our securities, or creating debts for futm'e liquidation. Which- ever way we look at it, we see that we are less prosperous than we were six years ago, and it may be that our present position is one of actual or coming adversity, — that we are now, or soon shall be, really living upon our capital. It is, however, asserted that we cannot be doing this, be- cause we are making constant accumulations at home.^ The ^ " Times," 7th Dec, 1877, " Excess of Imports." DEPRESSION OF TRADE. 155 same fallacy pervades this argument as the cognate one regarding home income. Accumulations at home may add to our comfort, but cannot avail us in our dealings with foreign countries, unless the accumulations be of moveable wealth which we transport abroad ; and even this will bo of no avail if we cannot persuade foreigners to take it in ex- change for those products of their lands which we need or desire. We may cover our own land with buildings, increase our rent-rolls to any extent, fill our houses with costly fur- niture, and adorn them with works of art; we may drain our marshes and embank our rivers ; we may extend our railway system, multiply horses and chariots ; we may dress in fine linen and fare sumptuously every day ; — but not one morsel of foreign food will any of these things bring to our shores, if we cannot barter them with other nations. If we are stocking our warehouses with goods in the expectation of revived demand ; if we are erecting factories and machinery which may enable us to produce those goods when that demand shall arise ; if we are building ships to carry them away, or laying down railroads to facilitate their transport ; we may be laying the foundation for a future accession of wealth, but we are not, in doing this now, accumulating that wealth, we are only preparing for its acquisition, and the wisdom or the folly of such procedure must remain in doubt until subsequent events may justify or condemn our forecast. Another course of reasoning is constantly to be met with, namely, it is argued that an excess of imports cannot really be at all injurious, since other nations with whom there is an excess of exports arc suffering from the same depression of trade. The error here lies in coupling together circum- stances which happen to exist at the same time, but which do not necessarily stand in the relation of cause and effect. Trade is depressed both in England and the United States, and from the same cause, — the producers are more than are needed to produce the quantities of goods consumed. But there the parallel ends ; — wo produce more than we can find 15G EXCESS OF IMPORTS AND buyers for, the Americans owing to maintaining a protective policy produce at a greater cost than consumers are willing to pay. Again, with us, agriculture is barely, if at all, profitable, because we produce at high cost; with them agiiculture is flourishing, because they raise their produce at such rates as induce buyers. We buy because we have not enough food at home to support our population ; they sell because they have more than enough. We can sustain doing this for a time, because in former times we have lent them money, the securities for which we can exchange for their food. They from the produce of their fields are paying off the debts incurred in warfare ; we are receiving payment of their obligations and eating it up as fast as we get it. But what would be the position of each country were all trade suddenly to cease, and each people were thrown upon its own resources ? We should have empty bellies ; the Americans might have bare backs. They, finding no market for their surplus food, would devote their labour to turning their cotton and their wool into clothing ; we should with difficulty, perhaps by costly methods, strive to increase the produce of the soil, and having exhausted our stores, be- come destitute of clothing, and whilst the corn was growing, the would-be eaters would starve. In short, we, losing our past gains and consuming our accumulated savings, should fall into decrepitude ; they, husbanding their re- sources, and unable to spend their means in foreign extra- vagances, would be prepared, when circumstances altered, to step into the place from whence we had fallen. To them the stoppage of trade would be painful; to us it would be absolutely fatal. More than one-half of our population will soon be absolutely dependent upon foreign supplies for their daily food ; and but two methods of supplying their wants lie open — either to make our land produce double crops, or to maintain the trade by which we exchange our manufac- tures for food and other necessaries, A third course is, indeed, open, and that is to transj^ort our population to places where food may be grown more cheaply, where those DEPRESSION OF TRADE. 157 who grow it would be thereby enabled, not only to support themselves, but to become purchasers of our manufactures. If these things be true the nation is passing through a crisis of greater severity than most of us are aware, and until a radical change take place in our manufac- turing and trading relations, we must look for a still greater disparity between its expenditure and its receipts, for the sup])lies it obtains and renders. By some it is con- sidered that foreign manufacturers having, like our own, been over-producing, are recklessly selling at unremunera- tive prices their accumulated stocks, and that we, being pos- sessed of more capital than they, will be able to hold out longer, and sooner be able to obtain higher prices for larger quantities. By others the cause of depression is sought in the disturbances occasioned by the war now raging, and they argue that when this is settled there will be an imme- diate revival of trade. By others the reason of the existing state of things is found in the unftivourablc harvests in this country of the last few years, and, believing that the sea- sons run in cycles, they predict that the turn will soon come for years of abundant yield. Others, again, lay the blame at the door of Free Trade and long for some modification of our treaty arrangements, which shall secure reciprocity, if not exactly a return to the old days of Protection. Once more, it is affirmed by others, that the evil arises from over- population, and that were measures taken to repress our increase in numbers, a different state of things would result. Now all these several causes and reasons, though in some degree they throw light on the condition in which we stand, appear to be insufficient to explain why the excess of im- ports should be so large and trade so depressed as it is. Nor does there seem to be any well-grounded hope that tho existing evils will bo speedily removed. It is with no desire to excite undue alarm that these conclusions are dwelt upon, but solely from the conviction that, when disease exists, a correct diagnosis is the first step towards effecting a cure. 158 EXCESS OF IMrORTS AND Without tliis^ the true remedies cannot be applied^ nor even effectual palliatives bo prescribed. The patient whose phy- sician fails to comprehend the true nature of the attack will suflfer loss of strength till the sickness becomes chronic, and all anticipations of recovery become hopeless. Where, then, is the remedy to be found ? In discontinu- ing the deep-rooted extravagance and want of economy which characterize the present age — extravagance in the expenditure of means, want of economy in the employment of time and strength. It is not that we have too many people, for, as the figures are capable of showing, even with our present consumption of food and other products, the proportion of the population employed in producing these leaves an ample number for producing what are not articles of necessity. With the wages our labouring classes have been receiving, there ought not, until very recently, to have been destitution or poverty amongst them, and, but for their lavish expenditure, comfort might have universally pre- vailed. It is high wages which enhance the cost of our manufactures, and so drive trade from the country; it is the misemployment of those wages which causes privation, and leads to sufiering. Were abstinence from drink, or even moderation in the use of alcoholic liquors, imiversal, there is no need, or at least there was none until recently, why hunger or nakedness should be undergone by so many. Look at what has been spent in this way. The 25 millions sterling mentioned before is simply the cost of the materials from which spirituous liquors are made. The heavy duties so properly levied on these beverages come to at least treble the cost of the material, and the labour employed in their manufacture must more than quadruple the price to the consumer. Let us add to these items the interest of capital devoted to their manufacture and sale, and we shall see how vast is the cost to the consumer. It is a low esti- mate which would put this sum down at an amount equalling the balance against our trade. Thus the whole difficulty would be solved could we effect a reformation in the drink- DEPRESSION OF TRADE. 159 ing habits of the people. -To find so many labourers on an average spending more than half their earnings on this one gratification, leaves no room for surprise that labour is dear and distress so general. The labouring class, however, are not alone to blame in this matter of extravagant expenditure — the middle and higher classes set the example. To outvie each other in the magnificence of their entertainments, equipments, and dress, seems to be the chief olyect in life to many; and whilst this feehng exists as it does in the upper classes, we must not be too hard on those lower in position who manifest an equal degree of folly. These may appear harsh words, but they are not too strong. The contrast which is manifested between the splendour of the rich and the squalor of the poor is utterly wrong, — it disgraces both our Christianity and our boasted civilization. We load our tables with course after course, whilst there are thousands whose vital power is impaired for want of proper nourishment ; we cover our persons with clothing ^yhich we cannot wear out, whilst women and children are perishing for -j^ant of necessary protection against the inclemency of our climate ; we fur- nish our houses with gilded finery, whilst the homes of hundreds are loathsome with filth. Nay, more than this, wo carry the same principle into our religion, lavishly spending in meretricious ornament the wealth which would provide the means of decent worship for the masses who never enter the places now set apart for religion, and wo spend the timo of our clergy in multiplying those neglected services rather than in sending them to meet with the outcasts of society who herd in the back streets of our cities and towns, whilst our charities are too many of them so bestowed that the im- portunate rather than the unfortunate become the recipients. Let it not be thought that this is condemnatory of genuine hospitality and honest social intercourse, of refined taste and liberal expenditure in adorning our homes or our per- sons, of elegance and graudt-ur in the erection of churches and chapels, or of frequent invitations to the services in our 160 EXCESS OF IMPORTS AND sanctuaries — for all those there is ample room, without waste of wealth and time. It will not do to say that the owners of wealth may spend it as they please, — consuming much and producing nothing. They are but stewards and trustees for the general welfare, as happily so many of our nobility and capitalists are acknowledging in increasing numbers ; but until this truth is universally admitted, there will never be the needed economy in the use of wealth, time, and influence. It will perhaps, however, be said that if all our people were to become frugal, industrious, and sober, we should increase the products for which there is no demand. Well, then, we must create the demand, — not by competing with other nations in their own markets, or bolstering up effete and decaying peoples who will never be satisfactory cus- tomers, — but by seeking out fresh fields, and sending our capital to the newly discovered regions which we may colonize, so finding customers amongst the many natives and the comparatively few of our own population whom we should need to send. Whilst such large portions of the globe are ready to yield their food productions to labour, and teem with multitudes who, with civilization, will bestow that labour, and for that which it raises will take our manu- factures in exchange, it cannot be a necessity that there be starvation and misery at home. It was remarked in one of the papers to which allusion has been made, that " Britain now stands tottering on the eminence to which she has attained.'^ Since that was said, her stability has not become more assured. She still stands tottering, — not from the instability of the foundation on which she rests, or from the want of strength to grasp the supports which may insure her safety, — but simply from the intoxication of success, the excitement of overstrained nerves, the difficulty of breathing in the elevated region she has reached. We have gained so much that we are living too fast. Let us check our progress in this direction, and we shall regain the means of still further progress in higher DEPRESSION OF TRADE. 161 ends, and shall attain yet more glorious results. If Xerxes wept that ho had no more worlds to conquer, so, now, let us rejoice that there are new worlds to subdue peacefully to the cause of civilization and Christianity. M IX. On the true Relation in which Imports and Exports should stand to each other in the trade of a pro- SPEROUS country/ SO mucli has been written and spoken of late on tlie question of Imports and Exports in their relation to the Balance of Trade, that it may seem superfluous to tender any further facts or opinions upon this question, but it is only necessary to refer to the proceedings of the Statistical Societies of London and Dublin as well as that of this city during the past year, to show that the subject is by no means exhausted. It may however be doubted whether there would have been so many utterances had there been anything like a thorough understanding or general con- sensus of opinion as to the principles by which our judgment should be guided in deciding on the evidence which these facts afford as to the prosperity or otherwise of a trading community such as that of the United Kingdom. The keen discussions which have arisen whenever these subjects have been under consideration, and the number of able papers which were read during the course of the last session in London, bear testimony to the wide interest which has arisen regarding these matters. It may not therefore be out of place to take this as the subject of the paper which your secretary has done me the honour to ask at my hands for this evening's meeting. Trade in its earliest form must have consisted in the ^ Read November 20tb, 1878, before tbe Manchester Statistical Societj. IMPORTS AND EXPORTS. 1G3 mutual exchange or barter of articles of consumption pos- sessed by one and needed or desired by another ; and would probably take place first in supplies of food. It would early be discovered that a concentration of time and strength on the production of one class of articles would yield greater results than if each individual attempted to raise or procure everything that he needed, whilst diversity of taste as well as circumstance would fix the pursuits in which each would engage. One being a tiller of the soil would obtain the animal food he required by giving up a portion of the grain or fruit which he either found or raised by his labour and skill. At first, and in the absence of any imperishable substance as a medium of exchange, the transaction would be one of simple barter, and the standard of value or rate of exchange be determined by the time em- ployed in the production of each of the articles in which they dealt. This would be truly payment in kind, and so long as the produce of a day's labour was given for that which bore a similar charge, perfect equality of bargains would exist, each party gaining more than he could obtain at the same cost, but neither more than he gave to his neigh- bour. Soon however, disparity in bodily strength, in skill or disposition, together >vith the advent of seasons and other circumstances favouring one occupation more than another, would produce inequality, and though for a time the balance might fluctuate, ultimately prosperity would probably attend the one and adversity overtake the other. Then would come the necessity of the weaker to submit to the one in a stronger position, who, such is human nature, would not be slow to take advantage of the opportunities afiforded by the other's need to exact unequal terms ; and thus the clement of profit and loss would be introduced. At the outset, this would probably be confined to dealings in food or other articles of prime necessity in which the buyer would be more or less at the mercy of the seller, but in those of more durable character and less indispensable to existence or comfort, the buyer would have the advantage. Since ho 1G4 ON THE TRUE RELATION IN WHICH need not purchase unless ho willed, ho would refrain until ho got or thought he got the best of the bargain,- — -but so soon as through custom, habit or overpowering inclination, the objects of desire became as good as real necessities, the one who sought to possess them would be led to yield to the demands of their owner ; and thus the most laborious or skilled whether of body or mind, as well as the least scrupulous would cause every exchange to be to his advantage. Then in process of time the most durable and the least easily obtained articles would become the representatives or standard of value. When jewels and the precious metala were discovered, these as being the most attractive lasting and portable of known substances would naturally become the medium of exchange, the recognized tokens of value; and payment in kind would be transformed into what was equivalent to our present cash payments, more distinctly such, when metals being stamped as coin had a definite nominal worth attached to each. Proceeding onward, the necessity real or fancied for one party to secure the food, clothing, or articles of utility and desire, although at the time destitute of the proper medium in which to make payment ; and on the other hand the wish of the possessor to part with his goods, on the belief that deferred payment would yield him a greater return than a present exchange; would lead to his acceptance of a promise to be fulfilled at a future time, and thus purchasing on credit would take its rise. Advancing a step farther, the owner of wealth accumulated beyond the power of personal employment, seeing those who desired advances — either under the pressure of poverty, or the belief that the temporaiy possession of what they had not themselves might gain for them more than they would have to repay — would be led to trust such persons with the use of his means on being secured a share in the profits arising from its application to purposes of manufacture or trade, and thus investment on loan or security would come about. IMPORTS AND EXPORTS SHOULD STAND. 165 Another form of this would be where undertakings were started too large for one or a few individuals to compass with their own labour or substance ; these would join their powers to those of others in like positions, employing partners or agents to carry on operations for their joint benefit, and in this manner partnerships and public com- panies would come into existence. Now just as it is with individuals so is it with nations ; and this sketch of the various stages of progress, which must be familiar to all who have devoted thought or study to the subject, has been introduced to bring to view dis- tinctly that which happens in the processes by which com- merce is carried on. To see clearly the true bearing which imports and exports have to each other, we must personify each country, gathering all individual traders as it were into units, and, disregarding all internal interchange of wealth or goods, just as we would the transfer of our purse from one pocket to the other, consider only that which takes place to or from the shores of each nation. Looking at it in this aspect, we shall see that all the several processes we have described are being carried on at one and the same time in the business of each trading nation, or at any rate in that of our own ; and that the true meaning or effect of the apparent balance between imports and exports depends upon the degree or extent in which either or all of these several methods prevail. In the infancy of trade, such for instance as exists in Africa — so many pounds of beads, or so many yards of calico are sent out to bo exchanged for as much ivory or oil as the untutored natives will part with. Here, although no money passes between the sellers or buyers, the money value of the goods sent out, together with that expended in transporting them from the place of production to that of barter, being set off against the price obtained for those brought back, less tho expense of bringing them home, will show the true amount of profit ; and wore all trade of this description tho excess of imports over exports would bo the exact measure of the KK) ON THE TRUE RELATION IN WHICH nation^s gain. In like manner, although in the first instance the goods may be sold for money, and others purchased with the proceeds brought back, or where one or more exchanges of goods or money may take place on the way ; wherever that which comes home is wholly procured by that which goes out, the difference between the money value of the two will be the nation^s gain or loss, and if the trade be profitable there must be an excess of import. These are in truth payments in kind between the nations engaged in the transactions. Again, supposing money to be sent home for goods exported, or money to be sent out for goods imported, the difference between the value of the goods on exportation and the money received in the one case, or in the other, be- tween the value of the goods when imported and the money with which they were purchased, is to the advantage of the country ; and if the amount of money in each instance is the same, the difference of value in the goods parted with and the goods received will be the exact gain or otherwise resulting to the trader. Imports must exceed exports in value if the trading has been successful; but the amount of money thus used may not be the same on each occasion, and then the difference between the two will be a cash payment to the advantage of whichever has parted with the most goods. These are truths so simple and eleinentary as scarcely to need expression, were it not for the fallacy which pervades so many statements in which it is assumed that because imports exceed exports it necessarily follows that the one must have been purchased with the other, and that the difference is wholly gain ; at least so much of it as is not absolutely the produce of earnings or dividends abroad, turned from money into goods, and sent home in this state, instead of bullion or cash. Such writers appear to forget that in the present day the bulk of the trade carried on is not by means of either payment in kind or by cash pay- ments, but on credit. It is true that the individual credits IMPORTS AND EXPORTS SHOULD STAND. 167 are of short duration, and must be speedily balanced ; but they may be, and are, balanced by other credits, not per- haps between the same parties, but between the nations thus trading together ; and it is utterly impossible to say as between these, how long or to what extent such credit may be given or taken. Once more, it docs not follow that the goods thus trans- ferred from one country to another are even paid for by credit. Of course, so far as each trader is concerned, they will be settled in one way or at one time or another; but the nations to which these traders belong may by means of ■other individuals be entrusting money to borrowers or bo investing money in property or joint-stock undertakings; and if so, all these must be taken into account before a true balance of profit or loss can be struck ; and therefore the apparent balance may in truth represent only temporary or permanent investments, or the calling in of those made at times long since gone by. It follows, then, that an excess of imports is satisfactory whenever it results : — 1. From a direct exchange of goods, those an-iving being of greater value than those sent out to be bartered. 2. From money realized by the sale of exports, instead of being remitted in payment, being exchanged for goods which acquire additional value from transport home ; always supposing that their value on arrival is beyond that of those whose proceeds procured their purchase. This, though somewhat differing in form, is really the same as the previous case. 3. From the money with which they are paid for being so much income accruing abroad, whether as earnings from labour, profits in trade, or dividends on investments. Under all those conditions there may be a constant and growiug excess of imports, the extent of which is the indi- cation and measure of national trading prosperity. To these must be added: — 4. When the excesses of goods imported are stored up for 1G8 ON 'J'lIE TRUE RELATION IN WIIICII omploymGnt in the production of articles for export, such excesses being only temporary^ and balanced by an excess of exports at a future time. On the other hand, an even amount or an excess of exports will be satisfactory when the money they realize is beyond their value on leaving, and is : — 1. Remitted home in cash. 2. Lent on good security abroad. 3. Invested in profitable undertakings or the acquisition of property in other countries. Applying now these principles to the past and present history of our own country^s trade, let us seek to discover the true import of the changes in its condition which the official accounts record and proclaim. In tracing the earlier history of British commerce, many difficulties stand in the way of arriving at any definite con- clusions. It is very uncertain whether full or accurate information was supplied, or the records kept with sufficient care ; and the mode adopted for reducing the quantities of the several articles of trade to their equivalent in money was by no means satisfactory. For reasons more fully ex- plained in two papers read before the Statistical Society (London) ^ this, known as official value, however correct in the outset, failed as time went on to give anything like a fair representation of the respective worth of goods passing inwards and outwards. It consisted of fixed prices assigned to each then known article of trade, to the list of which new goods were from time to time added, at the market rates attached to them at the period when they came to be of sufficient importance to be specially noted ; and this con- tinued to be adopted in the official returns down to 1854. The values were also thus compiled for the purposes of comparison so late as the year 1869, when this method of computation finally ceased to be adopted. As regards the exports of British produce and manufacture so early as ^ "Statistical Journals," Vol. xxxv., June, 1872, pp. 207-8; Vol. xxxviii., June, 1878, pp. 215-16 ; Vol. xl., March, 1877, pp. 19-22. IMPORTS AND EXPORTS SHOULD STAND. 169 1798, for tlic purpose of levying a war tax under the name of '* Convoy duty/^ shippers were called upon to make a declaration of the actual value. This obligation still rests upon exporters, and we have thus an unbroken record of declared values down to the present day. For the imports a system was introduced in 1854, whereby the " official values " were discarded, and " computed " ones made by officials at the current market prices were substituted. These gave place in 1871 to values declared by the im- porters on each entry for the landing of their goods, and thus the values now shown in the official returns for both imports and exports are derived from similar sources, — the owner's declaration, scrutinized by the officials who super\dse the landing and shipment of the goods, and the Statistical Department of the Customs from Avhence the published returns emanate. The following table gives an epitome of the trade from 1699, the earliest date of which there are any sufficient records, to the close of the last century, with the addition of the first fifteen years of the present one, showing the annual growth in value of the goods imported and exported, and the annual increase per cent, of each period over its immediate predecessor. For the first eighty years the par- ticulars are for England alone, from thence to the end of the century Scotland is included, and from thence forward the whole of the United Kingdom. The values on both sides of the account are the "official'' ones, none other being obtainable for imports during the whole period ; and though the ''declared values" might have been given for the last portion of the export account, those corresponding to the import have been retained. 170 ON THE TRUE RELATION IN WHICH Table I. — Showing the Annual Average Amount (in Official value} of the Imports into and Exports from England, in each decennial period from 1699 to 1778 inclusive, and those into and from Great Britain from 1779 to 1800 inclusive, together u-ith the Average Annual Increase per cent, in each successive period. [In million £'s to two decimals.] Period. Impoi ts. Exports. Annual Average. Increase per cent. Annual Average. Increase per cent. Into England : 1699 — 1708 £ 4-58 5 03 6-23 7-09 6-71 7-58 9-56 10-86 12-3.5 18-61 26-16 10 24 14 — 5 13 26 14 14 51 41 £ 5-85 6-.50 7-18 8-35 8-97 11-02 12-98 12-44 12-58 21-55 31-97 1709—1718 11 '19 — '28 10 '29 '38 16 '39 — '48 7 '49 — '58 23 '59 — '68 18 '69 — '78 — 4 Into Great Britain : 1779 — 1788 I '89 — '98 71 2 years, 1799—1800... 48 The same into the United Kingdom from 1801 to 1815 in quinquennial periods : — Into United Kingdom: 1801 — 1805 '06 — '10 28-92 30-29 29-85 11 5 1 33-01 37-02 45-08 3 12 '11 — '15 22 For the reasons already alluded to, absolute dependence cannot be placed upon these figures, and it would be rash to conclude either that they afibrd a trustworthy record of the whole value of the goods on either side, or that the difference between the two is certainly the balance for any or all of the years included in the table. There is, however, no reason to doubt that relatively to each other, and com- paratively one year with another, they may be taken as fair IMPORTS AND EXPORTS SHOULD STAND. 171 evidence of the condition of our trade. Having values for later years for both imports and exports on the two systems for the same year, it is quite possible with justice to arrive at the conclusion that however insufficient or erroneous the system may have been, the probabilities of error on either side of the accounts arc equal. We know that for the first few years of declared export value, it was in excess of the official ; and, therefore, that the figures given above were below the truth. That the same variation, though in less degree, attached to the import figures may be inferred from a comparison of the two rates given in later years. Again, the import values include the cost of bringing the articles hither, and the profit obtained on their trading, whilst the export prices exclude the charges and profit realized upon their sale abroad. These, in the earlier days of commerce, were proportionately heavier than at present, hence the real proceeds of our exports as applied towards the payment for imports would be much larger than they now are. The apparent balance in our favour would fail to adequately represent the gain to the country upon the exchange of its produce for the commodities of other lands. It will be observed on an inspection of the table, that we started with a balance in favour of exports, and not only maintained this through the whole of the 117 years over which it ranges, but progressively increased it, the imports for the last of the series being Gi times greater than in the first, whilst the exports were multiplied 7} times. Taking into consideration the causes of disparity it is safe to con- clude that in 1818 the purchases wo made could not have absorbed one-half the proceeds of the sales we effected. Now this is just what might have been expected. England was then laying the foundation of her trade, settling her colonics, and starting her connections in foreign countries. To both of these she was sending her sons, not empty- handed, but carrying with them the products of homo in- dustry, wherewith to supply the capital necessary for esta- blishing her settlements and businesses in their new homes. 172 ON THE TRUE RELATION IN WHICH Not idle, or wasteful, but earning money, and employing their savings for future profit abroad, rather than remitting them home. In the first instance trade would take the form of simple barter, inexpensive articles of home produc- tion being exchanged for those of foreign growth and manufacture, which as articles of luxury would fetch high prices when brought hither. But the necessity of support- ing life and the growing stability of the colonist and settler would also ensure the conversion of the goods from home into the food and other necessaries for the use of those whose labour and skill produced or acquired property abroad. Again, it must be remembered that excepting with gold or silver-producing countries, there are no means of remit- ting money from one place to another, and no way unless to a very limited amount, for one country to obtain property in another, but by first sending it there in some tangible shape, when it must appear as an export from the place of origin to that of occupation. That England has become possessed of large holdings in land, merchandise, and secu- rities all over the world no one will dispute. She can only have done this by first sending it forth either as goods ex- ported, or as living beings to produce and earn, first main- tenance, and then property. Under such circumstances it is utterly fallacious to say that she could benefit only to the extent of her imports — an excess of exports was necessary to the creation and continuance of her wealth outside her own shores. The next table continues the account onwards from 1816 to the present year. It differs from the previous one in showing, not the total imports, but only those retained in the country for home use, and the exports of British produce and manufacture only. These quantities afi'ord an easier basis for comparison than when burdened on both sides of the account with those merely passing through our hands to foreign customers. The import values are still "official" up to 1854, therefore not quite accurate for comparison with IMPORTS AND EXPORTS SHOULD STAND. 173 the actual export values. The double valuation in 1854 showed that at that date the " oflficial " were short of the " computcd^^ by something like 25 per cent., the result of the assumed prices on which they were founded being fixed; whilst increase of population in numbers and wealth had gradually added to the cost of almost all articles of consump- tion. It is probable, however, that this change was more rapid after the gold discoveries had begun to tell upon prices, and that in the earlier years, say some 10 per cent, would up to 1825 or 1830 represent the departure from ac- curacy. To this extent and more, allowance must be made in comparing the totals with those of the exports. For the first fifty years the annual amount is the average of quin- quennial periods, after that the actual sums for each year are shown. From 1850 to 1870 the values are ''com- puted," and as already explained they may bo accepted as equivalent to the declared ones in use since the latter date up to the present time. 174 ON THE TIIUE RELATION IN WHICH Table II. — Showing the Annual Average Amount of Imports of Foreign and Colonial Merchandise retained fur Home u-se, and of Exportn of Produce and Mannfucturcs of the United Kingdom in each quin- quennial period from 181G to 1865, and in each year from thence to 1879, 7vith the Annual Increase per cent, in each successive period. [In million £'s to two decimals.] Year. Imports. Exports. Value. Increase per cent. Value. Increase per cent. 1816 to 1820 20-66 26-20 33-83 36-53 47-59 57-54 72-92 89-70 158-01 201-18 245-30 230-34 246-60 248-40 258-76 270-51 296-36 315-45 311-99 315-79 319-01 340-96 316-14 305-74 21 27 23 8 30 21 26 23 23 27 22 —6 7 1 4 5 10 6 — 1 1 1 7 —7 —3 40-31 37-25 35-93 40-46 50-01 54-00 60-89 88-86 124-16 144-40 188-92 180-96 179-68 189-95 199-59 223-07 256-26 255-17 239-56 223-47 200-64 198-89 192-85 191-53 —6 '21 to '25 —7 '26 to '30 —4 '31 to '35 13 '36 to '40 24 '41 to '45 8 '46 to '50 13 '51 to '55 46 '56 to '60 40 '61 to '65 16 '66 31 '67 . . 4 '68 —1 '69 6 70 5 '71 12 '72 15 '73 '74 —6 '75 —7 '76 — 10 '77 — 1 '78 —3 —1 It will be observed that, as in the former table, there is a progressive increase on both sides of the account, although not in the same ratio as before, the imports advancing far more rapidly up to about 1825 than the exports do. So much so, that on making allowance for deficient import IMPORTS AND EXPORTS SHOULD STAND. 175 value, the two were nearly equal, and they continued so up to about 1845. From this time, under the influence of free trade, both sides progressed with great rapidity, the im- ports, however, outstripping the exports up to 1870. We had then two years, 1871-2, of excessive exports, since when these have rapidly declined, whilst until the present year the imports continued to increase. Bearing in mind that the import values are loaded with charges for freight, &c., which are not paid to the foreigner, and the export values are subject to the like additions accruing before they are paid for, it must be understood that to this extent a difference in the amounts here shown does not actually represent the sum to be paid by this country to its customers. Mr. Newmarch considers that to make the comparison just, the imports must be diminished by five and the exports increased by ten per cent. My own calcu- lations, made upon a different basis, ^ do not when spread over a period embracing the last twenty years, materially diflcr from his, and this close concurrence in results of the two estimates goes far to prove them correct. Both methods would place the amounts for 1872 almost on a level, thus leaving no balance either way. Since then the preponde- rance of imports has been so remarkable as to justify special attention to the calculated figures for the few years preced- ing and succeeding 1872, as having the most important bearing upon questions arising out of the present depressed conditions of trade and manufacture. The actual balances to bo provided for may be thus stated : — 1872 nil. 1871 £15,000,000 1870 34,000,000 18(!9 ;}0,000.000 1868 37,000,000 1867 27,000,000 18G6 36,000,000 1873 ,£10,000,000 1.M74 2ft,000,000 187o 54,000,000 1876 83,000,000 1877 94,000,000 1878 84,000,000 To sum up these observations, — From the earliest periods ' "Statistical Journals,'' June, 1877, aud September, 1878. 17G ON THE TRUE RELATION IN WlllCn up to about 1825 (growing annually up to 1818, thence de- clining) the exports of home produce largely exceeded the imports of foreign. From 1825 to 1872, although the im- ports exceeded the exports, it was not to an extent difficult to be accounted for. From 1872, when there was again if anything a slight excess of exports, the excess of imports has most rapidly increased, until now it must have reached the sum of £94,000,000 per annum. In the first period we were settling our colonies and cultivating trading relations with the world, and by this means accumulating property abroad. In the second, we were proceeding in the same direction, but also enjoying some of the benefits arising from previous outlay, and at its close reached the height of our manufacturing and trading prosperity. In the third we have been declining from this height, and are now ex- periencing the greatest depression in every branch of com- merce and industry both at home and abroad. The causes, efi'ects, and remedies of and for this state of things deserve the closest investigation, but it may be well previously to see what has been the recent progress of some other nations, selecting for this purpose as representative countries Russia, France, and the United States; extracting from official sources^ the particulars so far as they can be ascertained. It is to be regretted that these tables do not go back farther than the year 1860. The period, however, which they do cover is sufficiently long to present a fair estimate of the recent progress of the trade. * " Statistical Abstract for Foreign Countries." Board of Trade, 1877-8. IMPORTS AND EXPORTS SHOULD STAND. 177 Table III. — Imports and Expoi-ts of Mrrchandise into and from the liussiun Empire from 1861 to lh7G, icith the animal increase per cent, of each successive year over its predecessor ; also the balance of Bullion thence exported in each year. [In million £'s to two decimals.] 1 Exports. Imports. Year. Merchandise. Bullion. Amount. Increase per cent. Amount. Increase jier cent. Balance exported. 1861 2513 27-13 1-34 '62 2272 — 10 27-69 2 5-16 '63 22-95 1 28-68 4 9-86 '64 25-84 13 28-53 —1 3-70 '65 24-57 —5 32-13 12 3-21 '66 31-00 26 33-58 4 4 06 '67 39-97 29 36-13 8 —3-05 '68 41-31 4 35-88 —1 — 5-.30 '69 5414 31 41-87 17 2 06 '70 5319 —2 56-99 36 3-35 '71 58-35 10 58-47 3 1-62 '72 68-91 18 51-78 —11 —-81 '73 70-14 2 57-70 11 —•93 '74 74-65 6 68-37 19 •15 '75 84-09 12 60-47 — 12 341 '76 75-62 —10 63-47 5 15-49 The trade of Russia in common witli that of other coun- tries manifests a continuous increase from year to year. It is not large considering the number of its people, imports and exports together not averaging more than 38/- per head, whereas that of France is 181/-, United States 112/-, and the United Kingdom 382/-, but is increasing moro rapidly than either of these other countries. In the earlier of the years under review, the exports would seem to have exceeded the imports, not however to any great extent even when the bullion and specie are added, for being a gold- producing country, the quantity exported is a source of in- come just the same as any other product ; though in countries like ours it is merely the circulating medium, ebbing and 178 ON THE TRUE RELATION IN WHICH flowing and not properly included in the produce of the country. In recent years, say from 1872, the general im- ports have exceeded the exports, though never more than about ten per cent., which is to be accounted for by the known fact that she is improving her internal resources, especially in starting manufactories 3 although at the same time she has been incurring deVjts abroad, besides the heavy ones rendered necessary to meet the outlay incurred by war. Under these circumstances there is nothing to indicate waning prosperity in the fact that she is buying more than she is selling, laying out her money on the increase of pro- perty. She, but for her wasteful war, her expenditure of money and life, would be a growing and improving country, and even in spite of this is really advancing in manufac- turing and trading progress. Table IV. — The like Imports and Exports of Merchandise into and from France for each year from 1860 to 1877. [In million £'s to two decimals.] Imports. Exports. Year. Merchandise. Amount. Increase per cent. Amount. Increase per cent. 1860 75-89 97-69 87-94 97-06 101-13 105-67 111-74 121-06 132-15 1-26-12 114-70 142-67 142-81 142-19 26 —10 10 4 4 6 8 9 —5 —9 24 — 1 1 13 —8 91-08 97-05 89-71 105-70 116-97 123-54 127-22 113-04 111-60 123-00 11209 114-90 150-47 151-50 148-04 154-90 143-02 137-45 '61 7 '62 — 8 '63 18 '64 11 '65 6 '66 3 '67 —11 '68 '69 10 '70 —9 '71 2 '72 31 '73 1 •74 '75 140-31 141-47 —2 5 '76 159-54 146-79 —8 '77 — 4 IMPORTS AND EXPORTS SHOULD STAND. 179 France is of all tlio European nations, the one of most groTving prosperity. We saw her wealth in the ease with which she provided for the German indemnity and the war expenditure, and in the rapidity with which she is recovering from disasters enough to have paralyzed and destroyed nations even stronger than she. Her trade too is not large, though with a population less than half that of Russia she has double her trade; but exceeding in numbers that of the United Kingdom, her trade is less than half of ours. This she owes in great part to the fact that her soil and climate enable her to produce most of the food and other necessaries she consumes, and that she has not, as we have, to seek her supplies in other countries. External trade is often spoken of as to be valued for its magnitude, forgetting that this altogether depends upon the circumstances of the country carrying it on, since internal trade may render external unnecessary, and yet be every whit as advantageous as the other. Like Russia and England, the excess of ex- ports in the earlier years has given place to a deficiency in the later ones, yet not to an extent to cause any anxiety, seeing that she too has had to repair the losses by war, and will be fully equal to liquidating the external obligations she may have contracted. At present and indeed for some time past she seems to be accumulating bullion largely ; she is sharing in the profits from discounting our mercantile bills ; and, notwithstanding that she does import more than she exports, manifests a steady growth in wealth and power. 180 ON THE TRUE RELATION IN WHICH Table V. — The like Imports and Exports of Merchandise and Bullion into and from the United States for each year {ending 30th June) from I860 to 1878. [In million £'s to two decimals.] Imports. Exports. Years. Merchandise. i Bullion. Amount. Increase per cent. Amount. Increase per cent. Balance Exported. 1860 70-06 65-88 8-70 '61 57-22 18 42-69 —35 -86 '62 37-15 — 35 37-43 —12 4-25 '63 46-85 26 38-75 4 11-36 '64 62-73 34 29-90 —23 19-22 '65 43-69 — 30 28-52 —5 12-05 '66 88-22 102 27-60 — 3 15-69 '67 79-38 —10 57-84 110 8-08 '68 71-85 —9 56-12 —3 16-58 '69 84-70 18 57-33 2 7-78 '70 87-46 3 78-46 37 6-61 '71 105-29 20 89-25 14 16-07 '72 127-27 21 89-27 — 13-78 '73 130-14 2 105-22 18 13-15 '74 114-70 —12 118-63 13 7-95 '75 108-09 —6 104-02 —12 14-84 '76 92-90 —14 109-50 5 8-45 '77 91-34 —2 122-85 12 3-21 '78 88-10 —4 141-81 15 •32 Total... 1587-14 1401-07 188-95 The United States shows for the earlier years a con- tinuously increasing preponderance of imports, and for the later, a rapidly gromng excess of exports, its trade thus standing in direct contrast to that of the countries this side of the Atlantic. From 1860 to 1873, its purchases must have exceeded its sales by nearly 300 millions, of which not more than the half would have been met by the exports of bulHon. Since that year, in exact opposition to the condi- IMPORTS AND EXPORTS SHOULD STAND. 181 tion of our own trade, its imports have regularly fallen, and its exports risen in a greater ratio. In 1872, the imports were some 40 millions above the exports (not including bullion), in the twelve months ending last June more than 50 millions below them. During the first period she was paying for her imports in bonds, and securities, which wo on this side were ready to take ; and putting her purchases to such good use that now she is able to redeem her obliga- tions, and has already almost if not quite balanced the account, with every prospect of its continuing to be greatly in her favour. But for the exhausting influence of her in- ternal warfare, this change would doubtless have taken place earlier, and been even more complete than it now is. Nothing could more clearly demonstrate the fallacy of supposing that prosperity cannot be the occasion of an excess of exports. The following table of the trade between this country and the United States, affords equally conclusive proof that an excess of imports is not necessarily an evi- dence of the nations' well-beinof. 182 ON THE TRUE RELATION IN WHICH Table VI. — Trade between the United Kingdom and the United States from 18G0 to 1878 [1879 added']. [In million £'s to two decimals.] Imports into United Kingdom. Exports to United States. 1 Excess of Imports into the United Kingdom. Year. British Pro- duce and Manufactures. Foreign and Colonial Merchandise. Total. 1860 £ 44-73 £ 21-67 £ 1-26 £ 22-91 £ 21-82 '61 49-39 9-07 1-96 11-03 38-36 '62 27-72 14-33 4-84 1917 8-55 '63 19-57 15-35 4-35 19-70 —•13 '64 17-92 16-71 3-46 20-17 —2-25 '65 21-62 21-23 3-94 25-17 — 3-55 '66 46-85 28-50 3-34 31-84 15-01 '67 41-05 21-83 2-29 24-12 16-93 •68 43-06 21-43 2-37 23-80 19-26 '69 42-57 24-62 2-16 26-78 15-79 '70 49-80 28-33 2-98 31-31 18-49 '71 61-13 34-24 4-45 38-69 22-44 '72 54-66 40-74 5-17 45-91 8-75 '73 71-47 33-57 3-12 36-70 34-77 '74 73-90 28-24 4-00 32"24 41-66 '75 69-59 21-86 3-20 25-06 44-53 '76 75-90 16-83 8-39 20-22 55-68 '77 77-83 16-38 3-51 19-89 57-94 '78 89-15 14-55 2-98 17-53 71-62 977-91 429-48 62-76 492-24 485-67 1879 91-84 20-32 5-20 25-52 66-32 It will be observed that with the exception of the few- years of the war, there has been a constant growth in our receipts from the United States, and since 1872 an equal decay in the supplies she has required from us. In 1860, we took from thence only twice as much as we sent. During the present year we shall take at least six times the amount she draws from us. It would appear that our purchases from her at the present time actually exceed the amount of hers from the whole world. IMPORTS AND EXPORTS SHOULD STAND. 183 It needs but a cursory examination of the foregoing tables and explanations to show that since 1872 a rapid change has been taking place in the trading condition of the United Kingdom, one so marked as to account for the monetary crisis through which we have been passing, and the finan- cial anxieties Avith which we are at present surrounded. The apparent difference between imports and exports in that year was £10,000,000; in 1877 it was £112,000,000. The real balance to be provided for in settlement of our accounts with the rest of the world was last year some hundred millions of money; in 1872 it was nothing, or some four millions less than nothing. It is not for a moment assumed that we have actually to pay the whole of this sum ; a large portion of it is met by the retention abroad of interests on loans, dividends on shares, earninfrs of civil and military servants, freights in the can'iage of goods, profits on trade, &c. These have been variously estimated at from fifty to a hundred millions per annum — the exact amount it is not possible to obtain, nor with any certainty to assume, but various circumstances concur in placing it nearer to fifty than a hundred. The point for con- sideration, however, is not so much the exact amount as wherein it varies from that which existed in the former year, and it is impossible to believe that there is any diffe- rence at all approaching to the increased demands we have to meet. Many of our creditors have failed to fulfil their engagements ; many companies and speculations have come to grief. The story of the Glasgow Bank shows us how business has been carried on without profit, and altogether it is very doubtful whether, taking all the sources of income accruing abroad together, the supply now applicable to re- mittance homo or retention abroad is as great as it was in 1872. Beyond this we have positive proof that this country is transferring securities largely to foreign owners, and is not making corrca])ouding investments with the proceeds. This is one reason why the process of payment which has 184 ON THE TRUE RELATION IN WHICH been going on has failed to excite observation, — has not until now adversely afifected the foreign exchanges with this country. The war with Turkey, before its outbreak, excited distrust in Russian Bonds, of which some twenty millions are known, and double that value are supposed, to have changed hands from home to foreign owners. Every mail from America tells of remittances in her Bonds from this country, and some fifty millions of these, formerly held here, are now possessed on the other side of the Atlantic. The Bank of France, and discount houses in Paris, Frankfort, Berlin, Vienna, and Holland compete with our own money- lenders for the discount of mercantile bills and our own Treasury notes. A very competent authority considers that the amount of British paper in foreign portfolios at the present moment cannot be less than thirty millions of pounds, and that five years back five millions would have more than covered the whole. The German Government is known to have considerable sums deposited in England, to meet its contemplated purchase of gold, and there is reason to believe that foreign holdings in the English Funds and various stocks have been greatly added to. Now, what is all this but an actual transferral of capital from this country to America and Europe, not as in the days when we were contracting foreign loans, and support- ing foreign enterprises, but in exchange for the excess of imports we are drawing from foreign sources ? This is clearly shown by the difi"erence in the value of money in London and, for instance, in Paris. It would never pay to send money from here, where it cannot be obtained at less than six per cent., to there, where it is only worth three ; but it does pay to send securities instead of money. This is the very object which the Bank of England seeks to effect by its high rate — for there is no competition for money for home use which could send it up — to prevent gold being sent abroad, as it otherAvise must, to pay for the goods we import. And this process must go on until relief is obtained. The high rate for money here lowers IMPORTS AND EXPORTS SHOULD STAND. 185 the price of stocks and shares, until it suits the purpose of foreign holders to buy back their own, or to purchase ours. But the inevitable result is a diminution of capital in English hands, a lessening of the indebtedness of the world to this country, and a permanent loss on the income arising from our foreign holdings. It must be admitted that this coincides with a period in which imports largely preponderate. Is it untrue to assert that it is the natural result of such preponderance, and therefore affords proof that an adverse balance of trade is not always to be deemed a sign of prosperity ? If now we turn to the United States what do we find there ? A state of things exactly opposed in this respect to that which is existing here. Money is not plentiful, because in times past she contracted obligations which she is now discharging ; trade may not be prosperous because it is contracted, and prices are low — manufactures are not profitable because they are forced, in opposition to the principles of fi'ce trade — of this more hereafter, but amidst it all she is buying back her bonds with the excess of her exports. Just as England is diminishing her monetai'y claims upon the world, so America is diminishing her in- debtedness to the mother country. It is somewhat curious to note, without saying that they are the counter- part of each other, that the fifty millions which we may bo supposed to be parting with is just about the difference between our imports from, and exports to America. England, it may be believed, is in the position of a capitalist, who, having invested his money on mortgages upon the shops and plant of his butcher and baker, and finding his annual outlay increasing whilst his income is at the same time lessening, cancels his Christmas bills for meat and bread by writing off portions of the mortgage debt. The United States is the butcher and baker who, gaining more than she wants to spend, is glad to lessen the incumbrances on her properties. The capitalist may thus retain a good balance at his bankers, the tradesmen 186 ON THE TRUE RELATION IN WHICH may still have overdrawn accounts, but the one is inevitably growing poorer, the others are surely gaining in wealth. Here again an excess of exports is no token of adversity. But we must pursue this question a step farther. Even though it be true that all this monetary derangement and interchange of property and indebtedness result from the state of our imports and exports, these conditions of trade and manufacture are not the causes but only the effects of something more real and lasting which it is of paramount importance to us to discover. The balance of trade in any country may be the result of growth or decay in either imports or exports, or of an opposite condition in the one and the other existing at the same time. With the trade of the United Kingdom there was from 1872 until the present year, when both are decreasing, a constantly in- creasing amount of arrivals inwards and a like decrease of departures outwards, intensifying the evil, if such it be, and rapidly swelling the adverse balance. As the causes of this double movement were totally diverse, each requires its own consideration. To go fully into the question would require larger space than it is possible now to occupy, but the main causes may be briefly stated as an increased con- sumption of food at home, and a decreased or at least stationary use of our manufactures abroad. The natural growth of population has something to do with the increased importations of food, but is not the sole or principal cause, for as was shown in a paper on this special subject, which I had the honour of reading on a former occasion,^ in the ten years 1867-76 the addition to the population was barely nine per cent. — while the con- sumption of food (including alcoholic and other beverages and tobacco), was fifty-eight per cent, on the value; in 1877 it was fully seventeen per cent, more, and if there be any falling-off for this year, it will be in price only, and not in quantity. It is not meant by this that the average con- sumption of food per head has increased in this degree, for ^ "Transactions Manclicster Statistical Society,' 1877. Pp. 156-181. IMPORTS AND EXPORTS SHOULD STAND. 187 our home produce having remained stationary, the fresh mouths would have to be fed entirely from foreign supplies, which would likewise have to bear the charge of better quality as well as of quantity. During the same ten years the increase of raw materials for manufacture, both for home use and foreign sale, had only risen nineteen per cent. It cannot be questioned that there was great room for improvement in the quantity and character of the food supplies for our labouring population, and that even now a better supply of wholesale nutriment for many would be a decided gain in the health and strength which it would yield; but it may bo doubted whether the change has been in all respects necessary or advantageous, whether there haTS not been too much, especially in drink and tobacco, which has brought evils with it other than the great in- crease of expenditure it has occasioned, an expenditure far beyond the increase in productive power by which it has been accompanied. Nor have the evils been confined to the lower classes, those of the middle and upper have in a far greater degree adopted a style of living, which in ad- dition to the direct cost for articles of consumption, has also absorbed the labour of many consumers besides, and thus both enhanced the cost, and lessened the quantity of the disposable products of that labour. The higher wages granted to the labouring class, higher not only in nominal amount, but also in the hours' service for which they have been given, combined with the power of lavish expenditure the higher classes have attained, have been very far from unmixed blessings, since to them in a great degree must be attributed the inconvenient increase of our imports. The nation altogether has been living too fast. On the other hand the very prosperity which has for a time furnished the means of undue expenditure, has in several ways led to the loss of the power to continue it. It has increased the cost of labour, thus neutralizing the advantages of labour-saving machinery ; it has led to an extension of means of production at a greater pace than our 188 ON THE TRUE RELATION IN WHICH foreign customers have been disposed to advance, and it ' has stimulated other nations to compete with us in pro- ducing for their own necessities and the markets of the world. Hence the prices of our manufactures have fallen below those which yield a profit, and in many branches of industry the quantities taken from us are greatly reduced. Now this is just what we as a nation cannot possibly afford. Our country only grows half the food which our people consume, and therefore for our continued existence it is absolutely essential that we should produce some- thing else wherewith we may purchase or take in exchange from other nations the food we cannot, or do not raise for ourselves. Herein again we stand in decided contrast to the United States, she grows more food than she can con- sume. Were she blockaded or shut out from access to the products of other nations, the prices of provisions would fall, and her people might be all of them better fed than even now they are. Were England isolated, the cost of everything would rapidly rise, and so soon as the accumu- lated stores were exhausted half her inhabitants would starve. Again, we may say that the necessity which compels imports to exceed exports is the very reverse of prosperity ; the ability which permits exports to exceed imports is an exactly opposite condition to one of ad- versity. If, then, these be truths, and that they are so it seems im- possible to deny, is it wise to hide them from view, or to cavil as some do at those who strive to invite public atten- tion to their existence ? Like the ostrich who hides her head in the sand, we may fancy that they are best put out of sight, but the very attempt to deny their existence only serves to magnify their importance to others, and to arrest remedial attempts by ourselves. The patient who will not admit that he is ailing, and the physician who ignores the fact that his disorder is serious, are alike answerable if recovery is protracted or rendered impossible, whilst those IMPORTS AND EXPORTS SHOULD STAND. 189 who are not afraid to acknowledge the presence of disease, and boldly adopt the most likely measures for restoration, are those who also manifest the greatest confidence in the strength of the sufferer's constitution, and thus help best to maintain it unimpaired. We believe that England is seriously sick, but by no means irrecoverably so. Let us then consider what are the steps to be taken for her preser- vation and the renewal of her vigour. Considering the important bearing which a right under- standing of this question must have upon the measures necessary for the preservation or restoration of our national life and prosperity, it is not surprising that some thoughtful minds have been driven to a consideration of the best means for the attainment of these objects. Rather, is it to be wondered at that so few appear to think it of due impor- tance or are disposed to see that a very decided course of action is needed. It would seem as though the influx of prosperity in former years had so intoxicated all those who were drinking in its copious draughts that they could not dream of reverses or listen with patience to any who raised the voice of warning. Even now there are those who deem the present depression a thing of passing note, and who look to a revival of confidence, the settlement of the Eastern question, or the briskness of a war, as destined to restore trade and encourage manufactures to an extent beyond any former experience. It may be that some sudden and unex- pected events will arise to dissipate our fears and restore prosperity ; but true wisdom would dictate a recourse to such remedies as it may be possible to discover and apply. Before, however, suggesting anything in this direction it may be well to allude to a few of the plans which have been suggested, especially to the three methods which find favour with many, viz., reciprocity, protection, and the curtail- ment of production. Wherein the adoption of reciprocity consists has never been distinctly stated, but it may bo taken to mean either the removal of some duties or restrictions on our part, in 190 ON THE TRUE RELATIOX IX WHICH response to the abandonment by other countries of those which restrict our trade — or the imposition by us of duties or prohibitions in retaliation for those which most impede our trade already — in other words, a system of " limited protection." The first of these plans was that on which Mr. Cobden acted in the treaty he negotiated with France ; but apart from any question as to the soundness of such a policy, it would seem that the wholesale removal of all hin- drances to foreign trade with us, which took place years ago, has left us little or nothing to offer in exchange for such privileges as other countries might be induced to offer. All the Customs duties which we levy are imposed strictly for revenue purposes. Those upon alcoholic liquors fall quite as heavily on home production, and their diminution would entail a loss to the Chancellor of the Exchequer, which no increase of consumption could repay. Any advantage which a freer exchange of these commodities from abroad for home manufactures might procure, would certainly be purchased at a cost to health and morality which no philanthropist could possibly desire. The same may be said of tobacco ; and as regards tea, coffee, and cocoa, the increased trade which a remission of these duties would bring would be wholly insufficient, for many years to come, to compensate for the additional taxation which would have to be imposed on our own people. The I'e-enactment of the former, or the imposition of fresh duties, would in nowise differ from " pro- tection,'' and as such must be approved or condemned. A recurrence to '' protection " has many advocates in the present day, and there is no little reason to fear that the specious arguments by which it is supported may meet with such acceptance as to induce an attempt to reverse the free trade policy under which we have had so many years of prosperity. It is useless to contend that the protective policy of other countries — notably that of America — does not in fact most materially injure our trade and restrict our manufacturing industry, but its success in promoting the welfare of the counti-iea in which it is adopted is not so IMPORTS AND EXPORTS SHOULD STAND. 191 marked, as to ofiFer any inducements for its restoration in ours. Even the protected industries abroad are few of them in a prosperous condition, and whatever prosperity they do enjoy is at the expense of the other members of their own communities. It is true that France injures our sugar refiners, but the injury is paid for by the consumers in her own country. The United States, by protective duties on our iron and cottons, deprives our home workers of the employment they might obtain ; but the growers of wheat and the feeders of stock there are doubly losers, from the enhanced price they pay for the articles they buy, and the loss of sale for the articles which they might exchange for our manufactures. When we slacken — as we must do before long — in the demand we make upon their agricul- tural produce, her farmers will learn that they have much to gain from us, both as purchasers of their produce and sellers of the goods we can produce cheaper than their own manufacturers. At present both France and America can afford to be protectionists, because they have within them- selves all that is necessary for existence. England cannot afford to be so, because she is dependent upon other lands for a large portion of her daily supplies of food, and for these she can only make payment in the produce and manu- factures she can sell. Let us see how protective duties if imposed on imports from abroad would work. There is no denying that such as wore levied on articles which we ourselves manufacture would enhance the cost of importation, and so the price of those made at home. The first effect of this would be to restore and quicken extinct or languishing industries here, and so far as these were in articles of luxury no harm would bo done to the purchasers, although possibly it would restrict the sale and so soon defeat its own ends. But with articles of necessity for the labouring class any increase in price would really be ultimately paid in the liiglier wages they would have to receive. If duties were levied on articles of food, the same beneficial effect would at the out- 192 ON THE TRUE RELATION IN WHICH set be experienced by the growers at home. But this would in like manner raise the wages of those who manufacture for foreign markets, and thus still farther enhance the cost of those things in which we have to compete with foreign pro- ducers. Few persons seem to be aware how small an amount of manufactured goods for home use are supplied by foreign competitors when compared with the large amount of others which we manufacture for sale abroad. Of imports to the value of £319 millions in 1876, only £41 millions were manufactured goods ; whilst of our own produce, the cost of which must be enhanced if protection be restored, we exported £200 millions. Now, supposing the half of the £41 millions were articles of the kind which enter into competition for home use with those we manufacture for ourselves, any benefit accruing from protection would only affect a value one-tenth of that on which suffering would be inflicted. Competition with foreigners in our own markets, however seriously it may affect many branches of our in- dustry, is insignificant when compared with competition in foreign markets, where protection would not possibly benefit us at all, but must assuredly be of serious injury. We must have food for our population. We can only pay for that food by the products of our industry. Our present difficulty is that we cannot sell sufficient of these to meet our payments for food, and that difficulty protection would inevitably enhance. The third of these supposed corrections — that of curtail- ing production by running short time — is the least likely of all to lead to a satisfactory result. Had we been wise enough when the demand was greatest to see that it would not go on increasing, and have abstained from extending the means of production, the suffei"ing caused by its stop- page would have been less than it now is. But having sunk our mines, erected our mills and furnaces, and gathered together the labourers to work them ; to lessen their pro- ductiveness now would be to increase the cost of their pro- duce. Could we indeed turn part of the plant to other purposes, and employ the workers in other pursuitSj the IMPORTS AND EXPORTS SHOULD STAND. 103 romainder might still go on producing at a limited cost ; but to sacrifice capital and labour by partial idleness, whilst the interest of money and the support of the labourers must necessarily continue, would encourage the rivalry of com- petitors abroad, whose chief advantage already lies in the cheapness with which they are able to manufacture. If we possessed a monopoly in the production of any article of necessary but limited use, the lessening of stocks at home might enable us to raise the pi-ico ; but when other nations make as well as we, and are prepared to go on making, prices would be little affected by our ceasing to produce in the same quantity ; and in the end those who made the most and the cheapest would be sure to secure what custom was to be had. Inability to continue produc- ing, and the abandonment of the manufacture by some, would doubtless be to the advantage of those who hold on, but the national loss from the sacrifice would be the same whether centred in few or distributed among many. The true policy would seem to be to abstain from adding to the means of production, but at the same time to employ those at present in existence to their utmost capacity for good and cheap manufacture. With the hearty co-operation of all concerned, a quiet endurance of the consequent privation, and a patient waiting for better times, we ought to be able to maintain our supremacy in those industries of which we have so long been masters, and to beat all others in the neutral markets of the world. These observations have extended to an altogether unin- tended length, and but little space remains for further re- mark. Yet the subject must not be left shrouded in tho gloom of tho picture they present, mthout at least an attempt to illumine it with some rays of hope. It cannot bo that the enterprise, the skill, and the industry which have created tho position to which wo have i*eaclied, will fail us in the present time of distress. These national attributes will, if still maintained and rightly exercised, sustain and guide us until tho darkness shall pass away, and o 1!)4 ON THE TRUE RELATION IN WHICH tho sunaliino of prosperity again overspread the land. Bub before that can happen we have much patient endurance and active exertion to pass through. It will no longer do to act upon the maxim — " Take care of the imports and let the exports care for themselves." This did well enough when tho world was pressing upon us to supply its wants — not now, when we have to press our wares upon tho world. The first effort we have to make is one that scarcely needs to be suggested, for it will be forced upon us by stern ne- cessity. Shortened wages for the labouring classes, and too often the absence of any wages at all, will enforce economy in the use of the necessaries of life, and entire ab- stinence from many of the luxuries and enjoyments which have gone far to swell the amount of our imports. Dimi- nished profits in trade and want of employment for many will teach the same lesson to the middle-classes, whilst failing incomes and smaller returns for the use of capital will place the upper ranks in a similar position of necessity. Thus shall we lessen the payments we have to make for our imports, and also reduce the price of many articles of con- sumption for which, under the influence of extravagant ex- penditure, we have raised the charges to an unwarrantable height. It will also be impossible to maintain the shortened hours of service which have been introduced into many employments, or to be satisfied with the insufficient amount of work performed in the hours thus shortened. There is the unavoidable evil attendant upon all measures of retrenchment, and the concentration of labour amongst fewer hands, that they throw many persons in all ranks out of employment, and also bring many to seek for profitable occupation of their time who have heretofore had little to think of but spending time, money and strength in the mere enjoyment of life. This consideration brings us face to face with the special conditions which have had more to do in producing the present state of affairs than any other cause of which we know. Productive labour and capital have been over-weighted IMPORTS AND EXPORTS SHOULD STAND. 195 ^vith tlio unproductive members of the community, whom they have had to support. We have had too few producers and too many consumers. In the lower ranks of life this has led to the diffusion of work over too largo a space of time, or the abstraction of too many days for enjoyment or relaxation, rather than to the entire idleness of many indi- viduals. In the ranks of tradesmen, men of business, and professional men, and their assistants or servants, it has manifested itself in the crowding of too many into the diffe- rent occupations, and the unnecessary multiplication of em- ployments. Competition, so far as it stimulates industry and develops skill, or the talents which produce something that shall add to the general stock, is highly beneficial ; but competition which has for its object the obtaining the largest share of that which has been already produced is baneful in the extreme. Now this, in truth, has been the curse of our land. Is there any article of consumption to be sold, two shops for its sale are opened where one would suffice ; extravagant adornment and show are resorted to, to tempt customers from one to the other. Traveller after traveller waits upon the shopkeeper to gain orders for the manufacturer or importer ; advertisements, placards, mes- sengers are all employed to induce support to each of the rivals. The wholesale producer expends upon making his wares attractive, rather than good ; upon outwitting his rivals in trade, or satisfying the fancies of the consumer, rather than meeting his legitimate wants. Is a railway to be made, or some public undertaking to be started ? pro- moters, stockbrokers, solicitors, secretaries, fii*st ; then landowners, contractors, manufacturers, all rush to the front endeavouring to secure the greatest share of the money to be expended, rather than to diminish the outlay by tho shareholders. Is a public office to be filled or a charity to be bestowed ? a crowd of competitors waste their time in struggling who shall obtain the prize. Thus has it come to pass that the cost of everything has been swelled, the expense of division increased, until the difference between lOG ON THE TRUE RELATION IN WHICH the outlay, whether of time or money, on the first produc- tion, has been far below what it ought to have been from the price paid by the ultimate consumer or person who has enjoyed the benefit. Notwithstanding all our contrivances for saving labour, all our intense devotion to business, all our exercise of skill, scarce any object is attained or accom- plished which has not occasioned greater outlay between its first and final stages than was really needed. Too many hands have been employed upon it, to each of which it has paid toll rather than received help, and a feeling has per- vaded a large portion of all classes of society that they were to subsist upon appropriating that which others had pro- duced, rather than that which their own efforts had created. There is everywhere a superabundance of producing power which needs to find employment. Its wasteful expenditure has had much to do with enhancing the cost or lessening the produce of our exports, and thus in diminishing rather than enlarging our foreign trade. This might be borne so long as we were increasing in exports, for its weight fell largely upon the foreign consumer — but with rivals running us so closely in the race, he will no longer consent to help us in bearing it. In the previous tables (I. and II.) the trade shown is that of the United Kingdom, not only with foreign countries, but also with her colonies, which are there classified with foreigners, in both the imports and exports. Had the Colonies been left out, the balance would have been greater, for the traffic between us and them is more nearly balanced than it is with other places. Take for instance the year 1877, of £394 millions gross imports, £305 were from foreign countries, and £89 from British possessions, and of exports to the extent of £252 millions, the amounts were respectively £176 and £75. The excess of the former being at the rate of 72 per cent, in the one case and 18 in the other, showino- how much better customers are our own kindred O than foreigners. Had we gone a step further and shown not the trade of the United Kingdom, but that of the IMPORTS AND EXPORTS SHOULD STAND. 197 British Empire, including with our own all the regions which go to make up that miglity whole, the total figures would have been much larger, but the balance not very different. But in truth when speaking of our own country we ought not to confine our thoughts simply to the two islands of Great Britain and Ireland — rather extend them to all the continents and islands which own our Sovereign's sway. Geographically they may be distant from us, but with steam and telegraphic communication they are really more closely connected with us than the remote parts of Scotland and Ireland were in the last century. So are they in heart and soul, at least those who are of the same blood. The tendency of all our efforts ought to be to bind together mother and children more firmly than they have ever been before ; and if wo mistake not herein is to be found the only solid and lasting relief from the depression and anxiety we now experience. Economy in the con- sumption of our imports and in the production of our exports will do much to prevent the outflow of capital. The revival of a demand for our manufactures by our old and present customers may do still more. Somewhat better prices for the goods we sell, without a corresponding in- crease in those we pay, it may not bo unreasonable to expect, and we may naturally look for new markets to spring up amongst the people not yet civilized enough to manu- facture for themselves ; but it is futile to expect that the mining and manufacturing industries brought into existence in other countries will be destroyed — and we must antici- pate that every year ^vill strengthen their efforts to pro\'ide for their own wants. All that we may hope for is that they will learn the folly of fettering industry by protective duties and bounties, and recognize the truth that in promoting the interests of mankind at large, by removing all restrictions or regulations which prevent each country making the most of its natural advantages, they Tvill in fact bo most advancing tlicir own welfare. Yet economy in the use of our sub- stance, and therefore in the labour which creates it, together 198 IMPORTS AND EXPORTS. with the better preservation of existing life and its natural multiplication, will sooner or later force large numbers to seek new homes. We must biidge over the intervening seas, and extend our borders till we fill the territories which are placed in our charge. We hear much in these times of over-production — there is one branch of it we have never fully tried — that is the over-production of consumers for our products. Yet every life which is sacrificed by crowded dwellings, by neglect of sanitary laws, by the consumption of intoxicating liquors, by insufiicient food, by actual starva- tion, might and ought to be made a source of wealth. The Registrar-General estimates the average money value of each labourer's life, that is, the difi'erence between the wages he may earn and the cost of his sustenance between birth and death, at £150, and that of every man, woman, and child at £159; and it would be difficult to impugn the accuracy of Dr. Farr's calculations. My own researches, as detailed last year to the British Association,^ seem to prove that even at present the productive power of one is able to support eight ; and since the producer has an average of but three persons to provide for, there must be at least one-half free for luxury, enjoyment, or the cultivation of higher pursuits. There is surely something very wrong in the ad- ministration of afiairs which permits the want of food here, and the want of food-producers elsewhere. The coming leader of the State vnW have a problem to solve of far higher moment than the support of dynasties, the maintenance of the balance of power, the rectification of frontiers, however important these may be. He must find out how to feed the people at home, how to people our possessions abroad. The man who shall thus rectify this balance of trade and of population, will be the greatest benefactor with which England, her colonies, and possessions, the united British Empire, has ever been blessed. ^ " Keport of British Association, Plymouth," 1878. X. On Some Phases of tue Silver Qdestion.' IT is with much difEdenco that I approach the very difficult question which stands for discussion on the present occasion. At other times when it has been my lot either to introduce or take part in the subject of debate, the matters under consideration have generally been thoso upon which official expei'ience had qualified mo for the expression of opinions that might bo held with some con- fidence ; and though thoso opinions have sometimes been at variance with generally received views, the course of events has shown them to have been of some value in directing the course of inquiry, and eliciting information on topics of great national importance. In the present instance the inducement to investigate the question has been the belief that it was fitting that this Society should discuss it, that coming to the inquiry without any pre- conceived notions or special theory to support, and bring- ing to bear upon it the habit of careful observation and comparison, it might be possible for mo to bring together facts and figures such as might serve to call forth tho knowledge and experience of thoso whoso judgment on the various points at issue would bo of greater value than my own. Assured that whatever may bo adduced will meet with kind attention, I shall feel happy if the effort now to be made should succeed in throwing any light on tho sub- ' Kead before tlie Stiitisticul Society, 1st April, Is:*). Jouriuil, Vol. xlii. 200 ON SOME PHASES OF joct^ or of drawing out the intelligent thoughts of those to whom it has been an object of interest or study. In thus doing I must disclaim any intention of taking a compre- honsivo grasp of that which in all its bearings and results is too wide for me to attempt^ and I have therefore limited the title of this paper to that of " Some Phases of the Silver Question." I. — Connection of Gold with Silver. It is obviously impossible to treat of silver apart from gold. The two metals have in common not only that they belong to the same class^ and as articles of consumption subserve much the same purposes ; but that they have by universal consent been selected for use as a medium of exchange — the representatives of value for other articles — and thus as money have an employment distinct from all other substances (excepting the limited use of copper or bronze as coins). In our country when we speak of the depreciation of silver, we mean that a definite weight of it will pass in exchange for a lesser weight of gold than it did ; that the pound sterling will purchase more of it than was formerly the case — that is, that an alteration has taken place in the relative value which it and gold bear to each other. That whereas in July, 1859, when the highest price was reached, 62^d. per standard ounce, 15 grs. of pure silver were exchangeable for i gr. of pure gold ; in the same month of 1876, when it fell as low as 46|f?., it took 20 grs. of the former to purchase one of the latter, the extreme fall being 25^ per cent. Practically, how- ever, we have to deal with a fall from 6oid. — the average for 1871, and also for the whole period from 1833 to 1871 — to 49|(Z., the average pi'ice of the last eight weeks, being a depreciation in value as compared with gold to the extent of 1 8 per cent. We are so accustomed to speak and think of gold as having a fixed value because a certain weight of it, stamped THE SILVER QUESTION. 201 with tlic Queen's image and named a sovereign, is the legal and tangible representative of the pound sterling in which all our contracts or engagements are expressed, that wo forget that gold too varies in price. For unless we have it in possession we can only obtain it by parting with some- thing else we possess, or promising to pay so many pounds for it at some future time, and to thus obtain it wo must accept the purchasers' terms for the goods, or the promise, we choose to sell. Whenever we try thus to sell, we find that the number of sovereigns to bo received varies with the current value of other articles or the rate of interest on loans. Thus gold measured with other standards alters its relative worth, and it is always difficult to say whether the variation is in the gold or the article, or in both together. The only real fixture in value is the pound sterling, which, though in itself an imaginary standard, becomes a very real one when practically applied.^ Now there can be no doubt that for many years succeeding the gold discoveries in California and Australia the purchasing power of the sovereign became lessened — gold was said, and truly so, to bo depreciated in value ; now again the purchasing power of the sovereign is rising, and gold is said to be undergoing an appreciation. That is, it goes further in the purchase of articles, though not in the payment of debts ; but whether this is due to the increased value of gold in itself, or to a decrease of value in the articles it procures, is a point not easy to determine, and yet in relation to silver it is one of vital moment. It may bo remarked hero, though this point must bo treated afterwards, that dui-ing the whulo course of the plcntifulness of gold, silver never varied more than from 58^(?. per oz. in May, 181-5 (the lowest point imtil recently), to Gild, in July, 1859, a range oi 6i per cent, as opposed to the present fall of 1 8 per cent. The arguments on which this assumed appreciation of gold is stated to rest, are: Ist, That the production being diminished, it becomes scarcer, and therefore mu.st increase ' See "PoslscTipt," p. •2-i7. 202 ON SOME PHASES OF in value. 2nd, That there is so general a fall in prices as could only have arisen from the gold with which they aro paid having actually become more valuable. A little inquiry into the accuracy of these views is absolutely neces- sary before we can consider the relative worth of silver and gold. Let us first of all see what are the actual facts as to the quantity of gold in circulation, and the work it has to perform. It will scarcely be contended that so far as our home trade is concerned, there is any want of sovereigns for all the transactions of daily life. If there be scarcity it must be found in impediments to the discharge of inter- national obligations, or the conduct of the larger operations of home trade ; and in neither of these does the difficulty seem to exist. II. — Relation of Production and Quantity of Precious Metals to State of Trade. There would seem to be the greatest difficulty in obtain- ing any estimate of the total quantity of the precious metals in existence, either at the present or any former period. As regards the production since 1849 or 1852, there is not much difference of opinion. Messrs. Tookeand Newmarch, followed by the '^ Economist,'^ consider that between the former year and 1875 the workVs production of gold has been £573,652,000; whilst Sir Hector Hay ^ gives £572,195,000 from 1852, and during the same period £241,890,000 of silver, together £814,085,000. The same authorities would set down the consumption in the arts and manufactures and wear and tear of coin at about £2,000,000 per annum of each metal; thus if we accept either estimate, leaving something more than 500 million pounds sterling to have been added to the stock of gold, and something less than 200 millions to that of silver. Prior to 1849 it is supposed by Tooke and Newmarch that ^ II. C. Com. on Depreciation of Silver, 1876. THE SILVER QUESTION. 203 560 millions' wortli of gold was in existence — about an equal quantity to that since produced. If so, there must at the present time be more than I^IOO millions diflfused amongst the various countries in which it is used. Mr. Scyd's ^ opinion is that in 1849 there was about 400 millions, that 500 was raised between that year and 1875, but only 350 millions of this was added to stock, the difference having been absorbed in various uses ; so that tliei'e was then but 750 millions in circulation, which, brought down to this year, would be about 800 millions only. Thus both estimates assume that there is now, as near as may be, double the quantity there was thirty years ago. Our concern, however, is not so much with the actual amount, as the rate at which it has increased, and the necessity or opportunity for its employment has arisen. These are points on which great diversity of opinion is sure to be found, and anything like certainty is scarcely to be expected ; but in the following table I have endeavoured to place in juxtaposition some information which may help towards the formation of a tolerably accurate judg- ment. The first section sets forth the assumed production of both gold and silver since 1849. It is taken from the Appendix to the Report of the House of Commons Com- mittee on the depreciation of silver, and, excepting for the first and last three years, the figures are those given by Sir Hector Hay.^ Our present purpose is with gold alone. During the first twelve years, that is up to and including 18(30, the amount is 278 millions ; deducting 24 millions as used up, and adding the remainder to the 5 60 in existence prior to 1849, it maybe assumed that 814 millions were available for circulation as coin or in bullion in 1860. ' Committee of House of Commons Report. ^ Tlie lifjurcs from 1870 onwards arc altered from those originally read, Sir II. Ilay havinj^ kindly supplied them with the latest correc- tions, so that the whole of the series, 1852-78, now rests upon the same authority. Other estimates for recent rears are somewhat hicher. 204 ON SOME PHASES OF TAnLK I. — Shoimng the Estimated Production of Gold and Silver in each Year from 1849 to 1877; with the Imports and Exports of Bullion and Coin, as well as Merchandise, into and from the Principal Countries, since 1860. [In million £'8 to two decimals.] Production of Precious Metals. Bull ion and Coin. Merchandise Year. Gold. Silver. Total. Imports. Exports. Total. Imports. Exports. Total. 1849 .. 5 '42 8-12 I3"54 _ — '50 .. S-Sg 8-12 17-01 — ' — — — — — '51 .. i3'5z 8-12 21-64 — — — — — — '53 .. 36'55 812 44-67 — — — — — — '53 .. 31-09 8-12 39"2i — — — — — — '54 .. 25'49 8-12 33'6i — — — — — — '55 .. 2 7 '02 8-12 35"i4 — — — — — — '56 .. 29-52 8-13 37-65 — — — — — — '57 .. 26-66 813 34'79 — — — — — — '58 .. 24 "93 8 13 33-06 — — — — — — 'o9 .. 24-97 8-15 3312 — — — - — — — '60 .. 2385 8-16 32-01 83'72 83-30 167-02 677-87 580-69 1,258-56 '61 .. 22-76 8-54 3i'30 71-71 73-79 i45'5o 692-81 540-56 1,233-37 '62 .. 2i'59 9-04 30"63 91-98 89-02 181-00 681-01 570-84 1,251-85 '63 .. 21-39 9-84 31 23 97-68 96-14 193-82 745-87 654-57 1,400-44 '64 .. 22-60 10-34 32-94 108-62 109-75 218-37 829-78 702-77 i,532-S3 '65 .. 24-04 10-39 34'43 93-22 72-85 166 07 810-25 729-26 1,539-51 '66 .. 24'22 10-14 34 36 I3i"59 96-61 228-20 892-27 757-85 1,650-12 '67 .. 22;8o 10-85 33'65 ioi'6i 64-41 166-02 891-76 749-47 1,641 23 '68 .. 21 '95 10-04 3i"99 94-62 80-19 174-81 949-90 773-61 1,723-51 '69 .. 21-24 9-50 30'74 86-28 68-36 154-64 983-89 807-84 1,791-73 '70 .. 19-90 10-90 30'8o 90-57 70-67 161 24 969-18 831-43 1,800-61 '71 .. 21-10 u-oo 32-10 105-29 108-.''.2 213-61 1,127-78 9.54-68 2,082-46 '72 20-60 11-20 31-80 104-57 89-61 194-18 1,22625 1,028-73 2,254-98 '73 '.'. 21-30 12-20 33 "5° 152-58 145-80 298-38 1,273-72 1,0.56-88 2,330-60 '74 .. 19-40 12-90 32-30 106-45 69-26 175-71 1,251-97 l,055-.54 2,307'5i '75 .. i9'So 13-40 32-90 121-30 82-32 203-62 1,272-37 1,042-72 2,315-09 '76 .. 19-00 14-80 3380 105-47 87 03 192-50 1,267-28 1,02.5-04 2.292-32 '77 .. 19-40 16-10 35 '5° 119-89 99-77 219-66 1,236-26 1,011-85 2,24811 '78 .. 17-80 14-70 32"5o — — ~ ~ In the second section there are collected together the imports and exports of coin and bullion in both metals be- tween the principal countries for each year from 18G0 to 1877. The countries embraced in this collection are Russia, Hamburg, Holland, Belgium, France, Italy, Austria, United States, with the United Kingdom and her posses- sions in India and elsewhere, constituting probably five- sixths of the world's traffic. The particulars are taken from the several ofiicial '' Statistical Abstracts '' for the United Kingdom, foreign countries, and our colonies. The latter two do not go back further than 1860. With the exception of the quantities received from or sent to countries not THE SILVER QUESTION. 205 named, it is evident that the return will be double, the im- port of one country being in each case the export of another, but by adding the two together and taking the mean amount we may obtain a tolerably correct idea of the movements to and fro in each year. It is not practicable to obtain the separate quantities of gold and silver from all countries, nor to rely implicitly on the division in those in which it is recorded, but Mr. Giffen in a table laid before the Com- mittee has shown that for the United Kingdom the pro- portion of silver to gold stood for the years — 1858—61 as 0-57 to i 'G2 — 6G „ 0.63 „ I '67 — 71 ,, 0-63 „ I '72 — 7.5 „ 059 „ I the average of the whole period being 0'6i to i. For reasons which it is not necessary to explain, I am induced to think that the proportion of silver for the middle period, 18G2-72, was overstated in the official tables, pos- sibly so for other years, and that 0*50 or 0*55 to i would be a better ratio. Allowing then that between other countries there is more frequent transport of silver, it will not be far wrong to roughly estimate that altogether there would be twice as much gold as silver, and therefore that two-thirds of the movements are in the superior metal. This would show that the quantity of gold carried backwards and forwards in 1860 was 56, and in 1877 73 millions. In the third section a like collection has been made of the imports and exports of merchandise, giving a tolerable representation of the trade of perhaps five-sixths of the whole world. Taking, as before, the mean between the two, we got goods to the value of more than 600 millions in 18G0, and l,IOO millions in 1877 internationally exchanged, and having to be paid for in specie or by some other mode of settlement. 206 ON ROME PHASES OF III. — Sufficiency of Gold Supply. Tlio connection of this information with tlie subject may not at first sight be apparent, but its purport is to show that the trade of the world has not increased in an undue pro- portion to the stock of gold available for the purposes of the settlement of accounts between the different countries. This will appear on comparing the progress made from year to year, thus — 1860 '61 — 66 average '67—72 ,. '73 '74 '75 '76 '77 Existing Gold. Mlns. 814 876 996 1,072 1,089 1,106 1,125 i»i45 Moving Bullion, Mlns. 84= 10 per cent. 94=rII „ 89= 9 149=14 88= 8 102= 9 96= 9 110=10 Moving Merchandise. Mlns. 629= 77 percent. 717= 82 „ 941= 94 1,160 = 109 „ l,1.34=:io6 „ 1,153=105 „ 1,146=102 „ 1,124= q8 From 1860 up to 1873, the year in which the trade of the world reached its highest point, whilst there was a con- tinuous addition to the stock of gold, and a corresponding activity in the movements of the precious metals, there was a still greater increase in the interchanging of goods. Yet the gold in existence was ample for conducting the necessary exchanges. From 1873 to the present time there has been a steady decline in trade, and all the while an accession of gold, which forbids the supposition that there is an in- sufficient quantity for the purposes of international exchanges. There are no data for determining in what degree the home trade of the various nations has advanced, but it is pretty certain n ot to have done so to a greater extent in the several nations than their foreign has done. Nor are there any indications, so far at least as our own country is con- cerned, that the supplies of gold have been below our needs. The records of the London Clearing House are generally THE SILVER QUESTION". 207 taken to show the magnitude of the business being trans- acted, and in these the highest point was reached in the same year, 1875, when the amount of clearing was 6,013 millions; having risen from 3,257 in 1868, and now fallen again to 4,885 in 1879. The amount of bullion which the Bank of England was enabled to retain and consequently the extent of its note circulation, as shown in Table 11.,^ together with the same particulars for the Bank of France, would seem to show that there was no lack of gold to meet the uses to which it had to be applied. Beyond this, there can be no question that every ounce of gold is at the present moment capable of doing more duty than at any former period. In proof of this it is sufficient to allude to a few of the alterations which have taken place. The opening of the Suez Canal has halved the time occupied in transmitting bullion to and from the East and Australia ; and in like degree abridged the interval between the de- spatch of goods from hence, and the realization of their value in the countries of sale. An almost equal increase in the rapidity and frequency of communication by steam between other parts of the world, and especially in the use of tele- graphic intercourse, has produced much the same result in other directions. Then the extension of banking facilities has rendered unnecessary and unusual the storing up of any quantity of coin by traders or private individuals, and occasioned the vast majority of receipts and payments to be made with the use of very little money ; how little will ap- pear from the following analysis of " the total payments to credit of customers '' kindly furi:;ished by a banker, whose business may be taken as a sample of the general usage : — Per cent. Bills of exchange 8"6 Chc'fiues 88-5 Bank notes 2"6 Coin o"3 J00"0 ' Published in "Statistical Journal" for June. 1870. 208 ON SOME PHASES OF Do not these several observations justify the conclusion, that thoug'h at particular times and places there may be a temporary deficiency of supply ; so far from there being any scarcity of gold, there never was a period in the world^s commercial history when the existing quantity was so large as it is at present, in proportion to the necessity for its use or the purposes it has to serve ? IV. — Fall in Prices. Much stress has been laid upon the general fall in the price of commodities as an evidence that gold has become appreciated, and hence the inference drawn, particularly by Mr. Giflen in his paper read not long ago before this society,^ that ''very likely gold and silver have both changed." This opinion is so important as to deserve a close investigation into its validity. Mr. Giffen puts '' the average /a Z/ of prices between 1873 and 1877 at more than 20 per cent., exclusive, of course, of the additional fall in 1878.^' The "Economist," writing on. 28th December last, referring to a letter from Professor Jevons in its number of 8th May, 1869, " reasserting with the utmost confidence that a real rise in prices to the extent of 1 8 per cent, had been established since 1849," endeavoui's to show " that a real fall in prices to the extent of 1 6 per cent, has been established since 1869." Each of these three authorities measures the fluctuations which have taken place by a system of index numbers, in which the average prices of a number of articles (twenty-two in one case, fifty in another), ascertained in the years 1845-50, are each represented by i OO, and the variations in every subsequent year by a corresponding addition or otherwise to this num- ber. The aggregate of these several ratios becomes then the '^ index number,^' representing the value of all com- modities, and consequently the general rise or fall which prices have sustained in each successive year for which ^ " Statistical Jonmial," vol. xlii. pp. 57 et seq. THE SILVER QUESTION. 209 tho calculations have been made. Dividing this number by a3 many articles as have been employed, tho average is ascertained. This system appears so well adapted to attain the desired results, that I have followed it in constructing tables, show- ing not only the prices prevailing in this country, but like- wise of some staple articles in the places of their production ; taking as tho price the average of the year's transactions shown in the " Statistical Abstracts for Foreign Countries and for Colonial Possessions/' issued from the Board of Trade. I am unable, however, to adopt tho '^ Economist" figures as they stand, for they seem to me to err, inasmuch as of tho twenty-two articles four are for different descrip- tions of cotton goods ; and as this commodity is subject to unusual fluctuations, tho alterations in price affect the " index number" in a fourfold degree, I have, therefore, corrected the figures by including only one value for cotton (tho average of the four) , and have added coal,^ as an article too important to be left out ; thus obtaining an average of twenty instead of twenty-two articles. Professor Jovons's figures differ somewhat in principle. I should have pre- ferred using them, but that they are not carried forward further than 18(30, and the subsequent years are essential to the question under consideration. The ''Economist" numbers, together with the same aa I have ventured to alter them, and those of Profcss.or Jovous, will thus compare together : — ^ The exceptionally high prices to whicli coal, together with iron and other articles in the manufacture of which coal is consumed, rose in 1872 and following years, umhdy raises the index numbers. IJut fur tiiis cause those for 1872 to 1875 would probably have been 125, 132, 127, 124, rather than 133, 142, 136, 130, as shown in column 3 of next page. 210 ON SOME PHASES OF Year. " Economist." Same corrected. Jevons. 1847 104 107 136 119 122 124 172 162 162 137 122 121 122 118 129 134 131 126 123 123 116 lOI 103 114 140 123 118 123 124 125 144 151 138 141 128 122 118 119 118 !iri33 i !•/ 142 111136 ;l|U30 123 126 118 106 122 '48 106 '49 100 '50 lOI '51 103 lOI '52 '53 116 '54 130 125 129 132 118 '55 '56 '57 '58 '59 120 '60 124 123 124 123 122 '61 '62 '63 '64 '65 121 '66 128 '67 118 '68 120 '69 119 '70 '71 '72 '73 '74 '75 '76 '77 '78 '79 (1st January) — Note — Average 1845-50, for each series, 100. It will bo noticed that all the foregoing numbers relate solely to prices in this country. In dealing "w-ith those in other countries it becomes necessary to adopt a different point of comparison or datum line, because there are not within my reach any available records earlier than 1861 from which to ascertain the average of the six years 1845-50, THE SILVER QUESTION. 211 that •would bo represented by lOO. I have therefore formed a new index number, in which lOO stands for the average of each article for the six years 1877-72, thus working back- wards and showing each of the specified articles for each year in its relation to that number. In this manner it be- comes practicable to compare to some extent the prices in other countries with our own. The following table shows these in detail : — Table II. — Index Numbers for Prices of certain Articles in the Covntry of Production. The Avei-age of Six Years, 1872-77, being repre- sented by loo. Wheat Cotton. Wine, Silk, Rice Opium, India. Tea, Year. France. France. India. China, Eng- land. United States. France. United .States. India. 1S49 .... 83 _ _ _ _ _ '5a .... 75 — — — S3 — — — 87 — '51 72 — — — 6i — — — 77 — •o2 .... 76 — — — 57 — — — 79 — •53 .... 100 — — — 55 — — 87 — '54 .... .36 — — — 56 — — — 72 — '55 .... 141 — — — 55 — — — 6i — '56 .... J31 — — — 55 — — — 70 — '57 106 — — — 55 — — — 74 — '58 .... 83 — — — 50 — — — 92 — '59 .... 82 — — — 74 — — — 108 — '60 .... 100 — — — 53 — — _ 116 — '01 .... 104 95 122 71 MS 133 120 121 — 'f>2 .... 104 88 82 l.-iO 103 156 III 126 123 — '63 .... 84 IDO 63 376 '57 155 106 124 "5 — '64 .... 75 103 74 529 258 141 108 I05 "5 — '65 .... 78 MO 78 554 283 128 '45 83 89 — '66 .... 94 109 96 277 '75 113 139 71 93 — '67 .... 121 98 93 195 '53 114 114 89 107 — '68 .... 119 147 82 125 129 110 129 100 io3 — •69 .... 90 I118 78 161 114 121 '34 86 108 — '70 .... 88 loo 82 152 136 111 .36 97 lOI — '71 .... 107 102 82 96 133 100 121 110 05 — '72 .... 107 113 92 124 104 112 112 I114 108 — '73 .... no 1(12 108 121 III H>1 99 102 105 — '74 .... 104 111 104 99 104 1 Exports — Textile manufactures >? Total British produce >> Total foreign and colonial goods Year. Value. £ 1877 36-34 '78 40-29 '77 I02'l8 '78 89-28 '77 2082 '78 19-80 '77 74-92 '78 70-43 '77 183-77 '78 172-67 '77 128-12 '78 122-34 1877 100-55 '78 98-65 '77 142-36 '78 138-46 '77 36-63 '78 3776 Increase or Decrease on 1872. £ + 3-50 — 1-04 + 1-52 — 17-58 + 2-38 — 22-98 — 25-12 — 39-19 9">2 Increase or Decrease on 1877. £ — 375 — 10-17 — 0-71 — 3*34 — 1574 — 8-21 — 2-70 — 5-31 — 1-61 VI. — Variations in the Value of Gold. But apart from the variations in the value of gold, as measured by its power to purchase other commodities, some consideration is due to the alterations in its value for use as money, not for expenditure in consumption but in produc- tion. Although absolutely inert in itself, and unable to increase as natural products do, or as the products of labour, whether bodily or mental, do ; it yet has a power to increase in the hands of its holders by drawing to itself that wliich other means have produced. In this sense it may bo said to have two values — permanent and temporary — according 21G ON SOME PHASES OF as it is devoted to stationary or fluctuating investment. The one value is to bo seen in the price of the public Funds ; the other in the price of short-lived employment, as repre- sented by the Bank rate. The following table ^ shows the price for thirty years of English Consols and French Rentes, each paying 3 per cent, interest, and for the same period the minimum Bank rates in England, France, and Germany. In this country and in others having a gold standard, whereby there is a fixed relation between the ounce of metal and the pound sterling or other unit, having no other term whereby to express value than this same sovereign, we are apt to forget that gold really does fluctuate in value almost as greatly as other commodities ; or at least we are in the habit of thinking of depreciation or appreciation, as a gradual process so slow and steady as to escape notice, except by the occasional comparison of one period with another, whereas in truth an ounce or pound is worth much more at one time than another and in diflerent places at the same time. The average price of Consols during thirty years is shown to be 93|-, yielding thus an annual interest of £3*24. Now, looking to the facts that there is a proba- bility of having to sell or buy at a different price, and that the transfer occasions some small expense, we may strike off the odd '24, and say that in England gold lying absolutely secure without chance of loss or gain is valued at 3 per cent. In France the average price has been 66*03, yiG^piy in some measure to those articles which, not strictly necessary as food, enter largely into consumption. The increased sale for these may indicate, as doubtless it does, the possession by the labouring classes of greater means for enjoyment and jjersunal gratification, but, unless our producing power is employed as well as maintained, the supply of these means umst fail, and our importations as well as our exportations will decline both in (piaiitily and value." — 2(i//i January, 1874. , 224 ON SOME PHASES OF preceded its demonetization by the German Government by some months, although it is probable that the anticipation of this action may have exercised an influence prior to its actual performance. It would be out of place here to go over the same ground as regards imports and exports that has been travelled before, but it must be remarked that the growing balance of trade against us in each year from 1872 to 1877 would prevent silver being sent to us in payment for other goods. It would come here either in exchange for gold procured by the sale of secui'ities, or on consign- ment for sale, and thus like any other commodity for which the demand is slack have to suffer in value. The direct effects of this silver depreciation upon the trade and financial condition of our own country are not so serious as its indirect results. Our own standard being a gold one, and silver being used only for tokens passing at an artificial value by legislative enactment, no loss on our money is sustained ; but the Mint gains on the metal con- verted into coin to the full extent of the lower price at which it can be purchased. There are never very large stocks in the hands of British holders, and it is probable that the bullion merchants and speculative dealers have realized quite as much profit from fluctuations downwards as they would if the direction had been different. No doubt loss ensues wherever contracts exist which have to be met by receipts of silver, and trade must be impeded in silver- using countries by the necessity of charging higher for the goods we sell to meet the difference in exchange ; but as it does not appear that the prices of articles purchased for the home market have greatly risen in their silver value, there would on these be a corresponding gain. As regards India, up to March, 1877, neither the Viceroy there, nor the India OflBce here, seem to think that the pur- chasing power of the rupee had become less, '' The relative values of gold and silver not having varied in the same pro- portion as elsewhere ; " ^ and though " the silver prices of ' Parliauieutary papers relating to silver, 22nd March, 1877. THE SILVER QUESTION. 22.5 imported goods had not risou/' this may be accounted for by the fall in the price of their first cost. The Indian finances, however, have suifered most grievously from the revenue having to be collected in silver, and so largo a portion of it having to be paid in gold or its equivalent in England. The bills drawn last year upon India by the Government to meet the expenditure upon Indian account in this country amounted to £ 1 4,000,000, and the fall from 60 i to 52t\ represented a depreciation of 13 per cent., making an actual loss to the Indian revenue of nearly £2,000,000 for the one year only, whilst the estimate for the coming year is nearly double that sum. On oflicial or private persons having to remit money either in specie or bills, the same sacrifice is entailed. So far as concerns internal circulation in countries where the silver standai'd exists, it matters little what the price of silver in other places may be, but on whatever amounts they have to export to countries having a gold standard, a loss must ensue ; and that not only on the actual trans- mission of the silver, but on all transactions for which it is the standard, or rather upon the balance between the imports and exports. India suffers to the extent that she has to remit money to this counti*y ; but it must be remem- bered that as between the mother country and herself there can be no absolute loss, and India, as a country whoso exports exceed its imports (as shown in the following figures), should gain an equivalent for the loss on remit- tances, and in addition benefit by all payments from this side : — 22G ox so:\rE tiiases of [In million £*s to two decimals.] Imports. Exports. Surplus Exports. 1854-59 (average) '60-65 ( ,/ ) '66-71 ( „ ) '72 14-83 24-67 32-96 32-09 31-87 33-82 36-22 38-89 37-44 23-99 46-46 53-18 63-19 55-24 5500 56-36 58-05 60-96 9-16 21-79 20-22 31-10 23-37 21-18 '73 '74 '75 20-14 '76 19-16 23-52 '77 Either the rupee has retained its purchasing power or become depreciated. If the former, it will purchase the same quantity of goods which — were no other cause in existence — would sell here for as many sovereigns as be- fore, and purchase a greater number of rupees or weight of silver. If the latter, then labour and produce must obtain more rupees ; and taxation being levied in rupees, its burden must be correspondingly lightened. It will be observed that the surplus of exports exceeds the remittances that have to be made. The whole question would thus ultimately resolve itself into an adjustment of wages, prices, and taxes, to fit the altered value of money, were it not for the fact that India seems to be yearly growing poorer and less able to bear the charges for its government and expenditure. I am aware that far greater evils than these are assigned to this depreciation by a large number of thinkers and writers on this subject. The limits of this paper will not permit a consideration of the various arguments by which it is attempted to be proved that the decline of our exports, the fall in prices, and the general depression of trade, are all due to the altered relation in the value of gold and silver, and to the folly of our Government and others in not agreeing to a fixed and unalterable ratio of value between the two metals. They seem to me to rest upon the fallacy that money, rather than the wants, be they real or artificial. THE SILVER QUESTION. 227 of mankind, creates trade, and that you have but to stamp the one metal with an effigy which shall give it a certain value in another metal, to promote an almost unlimited growth and interchange of the products of industry, and thus enhance the welfare of nations. I cannot but think that whilst a sufficiency of tho circulating medium, be it in precious metals, Ijank notes, or other securities which pass readily from hand to hand, economizes labour, and so adds to the wealth of the world, the real prosperity alike of in- dividuals and nations depends upon the judicious use they make of their productive powers, and the right expenditure or consumption of tho products thus created. IX. — Bl-mctallic and other Theories. Did this paper profess to be an exhaustive one, it would bo necessary to take up the various propositions which have been made for dealing with the difficulties arising from the existing depreciation, or providing against their aggrava- tion in the future. Pretending, however, only to deal with some portions of a subject far too vast to be disposed of in a short paper, this branch of it might bo passed by. Yet a few remarks will probably be expected, and can hardly be omitted. Two classes of suggestions are offered, the one having for its object tho restoration of value to silver by fixing its relation to gold at a higher ratio than at present, such a proportion as till recently it enjoyed ; the other, that of obviatintic tho inconveniences of a fluctuating standard and a varying state of the exchanges, by the substitution of one that may be fixed. The views of ono side favour the adoption of tho bi-motallic standard or even the demoneti- zation of gold ; those of the other, the universal acceptauco of a gold standard, or such measures as would lead to its ultimate adoption. The great objection to the bi-metallic system is that it must rest upon an arbitrary valuation of tho two metals, which would with difficulty be maintained in the liome cir- 228 ON SOME rilASES OF dilation, and could not be permanently uphold in the inter- national uso of money. Its establishment requires that both metals should be a legal tender within the limits of every State, and therefore renders the choice of metal for the discharge of obligations dependent upon the will of the payer, who, in selecting the coin most convenient for him- self, might not always choose that most acceptable to the recipient. The simple difference in bulk — rendering trans- port difficult — and in the number of coins to be counted or weighed, would in most circumstances be to the advantage of gold and ensure a small premium in its favour. Under other conditions silver might be preferable, and its holder be enabled to dictate the terms on which he would part with its possession. A striking proof of the impossibility of maintaining any definite ratio of value between gold and silver is to be seen in the present accumulations of Bi'itish silver coin in the hands of bankers and other holders. Owing to the reduced expenditure on wages and the lesser amounts required for the purchase of articles of consumption, it becomes difficult to dispose of large quantities and a commission is charged on its transfer. This is virtually a fall in value, notwith- standing that its worth in relation to the sovereign is un- altered. It may be said that this results from silver not being made a legal tender to any amount, but the same condition would arise whenever the one metal or the other — almost always silver — was found to be in excess of the requirements for its employment. Without entering upon other details or producing illus- trations, it must be evident that in a country under such monetary conditions as ours, the mere possibility of being forced to transact business in the more cumbrous metal would be intolerable. The necessity imposed upon bankers and others of providing a sufficient supply of both to meet all demands would be adverse to economy in the use of money, thus both adding to the expense and raising impedi- ments to the settlement of business transactions. Here, THE SILVER QUESTION. - 220 practically, no more silver would get into circulation, but much more would have to bo kept in reserve at the Bank of England and the Mint, either of which might be called upon to meet large or sudden demands. Nothing can work better than our system of restricting the use of silver by its limited circulation as a token at an artificial value, and making gold, or notes whose convertibility is secure, legal tenders fur all but trifling amounts. Other nations, even where the standard is silver, are finding the convenience of our system, and the use of gold in preference to the heavier metal is be- coming more desirable every day. The introduction of such a system into our coinage could only be efiected in one of two ways, either by replacing our present coins by others of such a standard value as might be agreed upon with other nations, say 1 5 1- to i ; or by the addition to it of new full value pieces of such a size as would keep them distinct from the token coins now current, say those of four or five shillings — the fifth or fourth of the pound sterling — which should contain the requisite amount of pure metal to make them equivalent to gold in all trans- actions either at home or abroad. In our present coinage twenty shillings contain 1,614 S^'^' ^^ pure silver; those proposed would require 1^753, an excess of rather more than 8 i per cent. They would absorb, if the estimate of 20 millions as the amount in circulation be correct, at least a million and a half of money, besides all the expense of re- coinage, should new pieces be substituted for the old. It is difficult to see what advantafjo as reg'ards internal circu- lation could arise from cither course, or what difference it would make in the exchange with other nations., over the use of bar silver which now passes freely from one country to another. The advancement of the price of silver in tho liands of British holders, whether as coin, bullion, or plate would bo a decided gain; but for this would bo sacrificed tho favourable standing given us by the gold standard in the face of the diminishing production of that metal and the in- creasing supplies of silver. Should these continue or be 2P)0 ON SOME PHASES OF extended, and wo had the double standard, a drain of gold would most certainly ensue, which would prove emban-as- sing in the extreme. The great difficulty with which we have to contend is India. Mr. Seyd's proposition, ingenious as it is, to intro- duce a new silver coin of 350"62 5 grs. fine, which should be declared equivalent in value to four shillings, or one-fifth of the pound sterling, is avowedly dependent for its suc- cess upon a general agreement for a bi- metallic currency on the basis of 154- to I. Colonel Smith's plan, of stopping the coinage of rupees until by their scarceness they had at- tained the artificial value of two shillings, concurrently with the introduction of a ten-rupee gold piece identical with the English sovereign, establishing a still higher ratio of 1 4*6 to I (which is the intrinsic value of our present English silver coins) , could never be maintained unless other nations agreed to adopt it ; since, however possible it may be to keep a limited amount of token coinage in circulation, as we do here, it would be utterly impossible to maintain it for the whole currency of a nation. Mr. Hendriks's proposal for the introduction of a ten- rupee gold coin worth irths of the sovereign, and an altera- tion of the silver rupee to 1 1 per cent, less pure silver than at present, seems hardly practicable in the face of the pre- sent reduced price of the metal. Now all these schemes, as well as the new American dollar, and various other arrangements, seem to be based upon the fallacy that it is possible by any agreement or law to fix an unalterable ratio between two substances the cir- cumstances of whose production and employment are sub- ject to constant variations. We have seen how impossible it is to maintain an equilibrium in the value of gold at different times, or even in difierent places at the same time. It is, therefore, scarcely too much to assert that the attempt to do so with silver must inevitably fail ; for although the internal relation may be enforced by law, the conditions of different countries are so diverse and fluctuating, that each THE SILVER QUESTION. 231 one in its external relations must be subject to ever-chang- ing adaptations, suited to the position of affairs at the moment when the exchanges of commodities, securities, or bullion require to be effected. The true wisdom would therefore appear to be found in every country having but a single standard. For facility of intercourse with other countries it would be well if that standard were the same for all, and until some other sub- stance of superior fitness be found, everything points to the conclusion that the best standard is gold. It docs not, how- ever, at all follow that it would be wise for every nation to imitate the example of the German Government by changing from the one metal to the other. The existing stocks of gold are clearly insufficient to supply the wants of tho world should this be done, and at the present price of silver, to say nothing of that to which it would fall if it were everywhere demonetized, such a step would entail heavy and ultimately ruinous loss upon the countries making tho change. Sound policy would seem to dictate that each country should, for the present at least, maintain its existing standard, and that all should put up with the inconveniences, and even loss, which the diversity occasions. Least of all would it be wise for England to forego tho advantage she herself possesses in her gold standard, her convertible notes, and her subsidiary silver and copper coinage. For India, she should wait her time for the introduction of gold, and meanwhile, hard as it is upon that country to be fettered Vjy engagements to pay in gold, or according to the gold standard, large sums which are collected in silver, it really only amounts to a failure of revenue such as might have arisen from other causes, and is a far lesser difficulty than she will have to cope with when, as it assuredly must be, and ihat at no distant date, her opium revenue is extinguished. It will be asked, then, is nothing to be done ? Are all tho distresses and inconveniences, public and private, per- taining to tho present state of things to bo unmitigated ? Are all the dcran;jrenjeuts in mercantile affairs to continue 232 ON SOME PHASES OF as thoy aro ? Tho answer to such questioners is two-fold. Firstly : Let us see any remedy proposed which does not create a disease far worse than the one it professes to cure. Secondly : Is there any need for action ? Will not time and patience bring round a recovery ? The depreciation of silver commenced with the adverse turn in the balance of om- trade^ and I firnaly believe that when trade recovers from its present depression, such abundant use will be found for all the silver as will restore it to its former rela- tion to gold j and then the substitution of a gold for a silver standard in India, though it will not effect any stable relation of the one to the other, will obviate much of the inconvenience resulting from the want of a uniform standard for every portion of the same empire. It would be absurd to say that such a restoration may not be retarded, advanced, or even defeated altogether by some new discoveries or in- creased production of either the one metal or the other; but supposing the supplies to continue at the present rate, or not greatly to vary from it, either the opening up of new markets amongst a poor or uncivilized people, or the disper- sion of a large number of our population to open up new colonies or extend the old ones, will call into use quite as much small change as will absorb all the silver yet available, and thus correct the evil which is now the source of so much disquietude. X. — Concluding Remarks. Slfortly to recapitulate the several phases of this question which have thus passed under observation, we may observe : I. That basing our calculations upon the best estimates which can be obtained of the annual production of gold and silver, and comparing the assumed stock of gold with the movements of bullion and merchandise throughout the world, there appears no reason to suppose that the existing .supply is not amply suflScient for all the purposes of trade as at present carried on. II. That the general fall of prices in recent years has THE SILVER QUESTION. 2/53 neither been so regular nor so closely connected with the supply of gold and silver, as to prove that alterations in the purchasing power of the sovereign have been due wholly or chiefly to an appreciation of gold. III. That the variations in the value of gold itself, as shown by the fluctuations in the price of the funds, and the rates of interest charged for the use of money, prove that it has no constant or unalterable value. IV. That, in addition to the well-known eflfects on the value of silver arising from the growing yield of the American mines and the decrease in its use from its demo- netization by Germany, there are others resulting from the increased quantity of gold, the facilities for economizing its use, and its natural superiority to silver, sufficient to account in some measure for the depreciation of the inferior metal. V. That the coincidence of the fall in the price of silver with the contraction and depression of trade renders it probable that in this is to be found the most potent cause of depreciation, and that the revival of trade \2.... -935 7-84 0-90 3(10 0-50 0-90 6 00 2-14 '63.... 8 88 8-00 0-90 3-n 0-50 1-70 600 2-14 •64.... 9'i3 9 22 0-80 2-95 0-50 2-20 6-00 2-14 '65.... 882 10-64 080 3-28 0-50 2-25 6-00 2-14 '66.... 8-84 li»-70 0-80 3-38 0-50 2-00 6-00 2-14 •67.... 7-91 lo-:!5 0-70 3-35 0-50 2-70 6-00 2 14 '68.... 7-64 9-60 0-60 3-60 0-50 2-40 5-50 2-15 '69.... 6-31 9-90 0-50 4-03 0-50 2-40 5 00 2-10 1870.... 7-70 6-70 0-50 4 -.50 o'5o 3*40 5-50 2-00 '71.... 8-60 6-80 0-70 4 -.50 0-50 3-80 5-20 2-00 '72.... 7-30 7-60 070 4 -.50 0-50 400 5-20 2 '00 T.\.... 7-80 7-80 0-70 4-50 0-50 5-40 4-80 2-00 '74.... 5 "90 770 0-80 4 -.50 0-50 5-90 5 00 2-00 '75 570 8-110 080 4 -.50 0-50 640 5-00 2-00 •76.... 4-50 8 -.50 J-QO 4-50 0-50 7-80 5-00 2'00 '77.... 4-50 8-90 I 00 4-50 0-50 9-10 6-iX) 2-00 '78.... 4 'CO 7-80 I -00 4-50 0-50 7-70 6-00 2'00 246-67 253-85 22-90 93-75 i3"50 70-50 152-20 5636 Note. — These amount.s make up the totals shown in the table on pago 204. XI. OxV THE Decay in the Export Trade op the United Kingdom/ MUCH attention has been given to the state of our ex- port trade^ and the fact that for several years past there has been a progressive decline in its total value. Considerable discussion has taken place as to whether the fall has been in the quantities of the goods we have sold or the prices which they have realized ; and a large prepon- derance of the opinions expressed has been, that it is due to the latter rather than to the former cause. The Prime Minister on two occasions especially, when the subject has been under discussion, has drawn consolation from this con- viction. Mr. Bonamy Price has treated it in the same light in the '^ Contemporary Review/^ and Mr. Brassey in the " Nineteenth Century/^ whilst most of the leading journals have adopted the same theory. It cannot, therefore, be unfitting to inquire upon what foundation it rests, or whether the few voices which have been raised on the other side may not have some reason for the view they take. At first sight it may seem a very easy question to deter- mine whether it be the volume or the value of the exports which has suffered change, and a simple inspection of the figures for any particular article will decide the point so far as that article is concerned. Thus when we see that in 1872 we exported cotton piece goods to the extent of ^ Read before Section F of the British Assoeiation, at Sheffield, August, 1879. — " Statist," Sept. 6, 1879. EXPORT TRADE OF THE UNITED KINGDOM. 230 3,o38 million yards at a value of £58,931,000, whilst in 1878 our exports were 3,618 million yards, the value of which was £48,086,000, it is evident that the diffe- rence in value is duo to a fall in price. Also when there was an export of sheep's wool in the former year of 7,G05 million ll)s. at a value of £629,000, and in the latter of C/iiO million lbs. at a value of £546,000, it is equally clear that the lesser value is owing to diminished quantity, and an easy calculation will show that the average price per lb. was slightly higher in 1878 than in 1872. Again, with linen piece goods the quantities were 245 million yards in 1872 and IGl millions in 1878, the respective values being £7,700,000 and £4,91 7,000; it is at once seen that there has been a serious falling off in quantity, whilst the average price has varied but little. In like manner each specific article speaks for itself, but the proportion in which it affects the total result has to be ascertained in combination with that of every other article, before it can bo discovered whether on the whole the admitted fall in value received has been occasioned by diminished quantities or reduced prices. Lord Beaconsfield's statement rested upon the authority of a report made by Mr. Giffen, the head of the Statistical and Commercial Department of the Board of Trade, comparing the quantity and value of the goods exported in 1873 with those in 1877, and showing that, whereas in the former year the total declared value of the exports included in the return was £192,433,000, and in the latter only £147,800,000, the changes in the average prices had been so great that had all the exports of 1877 been valued as those of 1873, the total valuation would have amounted to £191,530,000, or less than a million below that returned for the former year. There are many articles of which the statistical records do not show the quantities, but the values only ; these are not included in the above figures, it being impossible to subject them to the same treatment. Those dealt with, however, represented 7o'l per cent, of the tottil 240 ON THE DECAY IN THE EXrOKT TRADE exports of 1873, and 74-6 por cent, of 1877. Tlio calcula- tions are carefully worked out, and the deductions are un- impeachable ; yet there is good reason to doubt the correct- ness of the inference drawn, viz., that the export trade of the country is suffering only in the prices and not in the volume of our transactions. Tables having the same object, and formed upon a some- what similar basis, comparing the trade for a portion of 1872 and 1873, were published in '' Lloyd's List " in July, 1873, and that of 1872 with 1877, and of 1877 with 1878 in the " Economist ^^ of July, 1878, and January, 1879, and the " Statistical Society's Journal" for June of the present year contains one contrasting 1872 with 1878. These all point to a real deficiency of quantity as well as value, the latter table showing that whereas the total difference on a value of £195,820,000 in the specified articles for the two years was £5 7,360,000 ; of this amount £45,260,000 only was due to a difference in price, £12,100,000 to an actual diminution in quantity. That is, articles which in 1878 were valued at but £138,460,000 would at the prices of 1872 have amounted to £183,720,000, or 32-69 per cent, more. A similar disparity is manifested by a comparison be- tween the exports for the first six months of the present year and the same period of 1872. In these the difference on a value of £83,460,000 was £28,500,000, of which £21,620,000 arose from altered prices, and £6,88o,000 from diminished quantity. That is, the articles which in 1879 were valued at but £54,960,000 would at the prices of 1872 have amounted to £76,580,000, or 39*34 per cent, more. The main sources from which these variations arise will be more clearly seen from the following selection (Table I.) of the seven principal articles of which the foreign export trade consists, and comparing together the three periods already alluded to, that of 1877 with 1873, 1878 with 1872, and the first half of 1879 with the corresponding portion of OF THE UNITED KIXGDO>[. 241 1872 ; sliowing in each case the total value of the exports in the later year, and the amount wherein it varies from the earlier one, dividing this variation into the respective suras arising from differences in quantity and in price. These seven descriptions of goods embrace between 00 and 70 per cent, of the whole export trade, that is of those which, from being recorded in both quantity and value, permit of being thus analyzed, and are fairly representative of those not thus included. Of goods coming under other denomina- tions, such as apparel, chinaware, machinery, &c., all of which are shown in value only, it may bo assumed that they very much follow the same rules as those that are specified, Table I. [In million £'s to two decimals.] Goods Kxported. Cutton Manfs (6 Mo.)... Jute „ (6 Mo.).. Linen ,, (6 Mo.)... Woollen „ (GMo.)... Coals (GM,..)... Copper (Ol^Io.)... Iron (6 Mo.)... ToUils of) 8 pee i tied '- Articles ) (G Mo.)... Yours. 1877 '78 '79 U •7 '78 '79 1877 '78 '79 1877 '78 '79 1877 '78 '79 1877 '78 '79 1877 '78 '79 with 1873 ., '72 '72 1873 '72 '72 1873 '72 '72 1873 '72 '72 187;3 '72 '72 1873 '72 '72 1873 '7^ '7a 1877 '78 "79 1873 "72 Tot 111 Vulii. Later Years. Incrense or Decrease in Value due to 2o-n 18-40 125-02 12062 54-96 40-20 21-6-2 242 ON THE DECAY IN THE EXPORT TRADE and would not materially alter the result if it were possible to take them into the comparison. Collecting thus these specified articles, it appears that there was exported of them in 1877 a total value of £125*02 millions, which fell short of the trade in them in 1873 to the extent of £42*30; and that dividing this fall into the amount due respectively to diminished quantities and prices, there was £2'lO of the one, and £40*20 of the other, or at the rate of rather more than 1 to 20. These years of 1877 and 1873 were the two which have been relied on as establishing the fact that the fall in total value has been almost entirely in pi-ice ; but, as will be shown pre- sently, this conclusion will not bear a close investigation. Extending the comparison to one year further back and another further forward (1878-72), an interval of six years instead of four, and dealing with a total value of £i20'62 for the later, it will be seen that the fall from the value of the earlier year was £56" 1 3, of which £14' i 2 arose from lessened quantities, and £42*0 1 from lower prices. Upon comparing the first half of the present year with the same months of 1872, the value for this year is £54*96, or £28*50 below that of 1872, divisible into £6*88 and £21*62 for quantity and price, these two periods being in the propor- tion of about 1 to 3 of quantity to price. But even this relation of the one to the other is subject to large coitcc- tions, and would not be supported by a comparison with 1871 instead of 1872. That year has not been selected on account of an alteration in the system of accounts which then took place interposing a difiiculty. It will be remembered by those who have at all watched the market prices of various articles, that in 1872 there set in what may be termed a famine of coal, during which almost fabulous prices were obtained for this article. For the eleven preceding years the export price had averaged 9 64s. per ton; the highest of any year not having ex- ceeded 10*396'., nor the lowest fallen below 9s.; but for 1872 the average was 15*83.'., increasing to 20*905. in 1873, OF THE UNITED KINGDOM. 2-43 then by successive stages coming down to 9*46.9. for last year, and 8.91.?. for the first half of the present year. Nor was this rise confined to coal ; it necessarily extended to all articles whose cost was increased by that of the fuel em- ployed in their manufacture. To take pig-iron as an example. The average for the years 18G0-71 had been 57'76s., the limit of variation between the highest and lowest years having been but 10*755. It rose, however, in 1872 to lOO"85s., and in 1873 to I24"65s., fiiUing again to 57'34s.in 1877, 53*525. in 1878, and 48*635. in the present year. The effect of this rise was to raise the percentage which these two articles bore to the whole exports of British and Irish produce exported from the United King- dom from 3'2 in 1871 to 8'0 in 1873, or, including every description of iron, from 14*3 to 20*0. Now, it is obvious that any comparison based on such inflated prices as these, when contrasted with other articles, might, as in fact it did, when the two descriptions were brought into one common total, conceal an extensive decrease in the quantities of those articles which maintained a more equable price. A grocer who found his gross receipts increased by 20 per cent, might be gaining 25 on his tea, whilst losing 5 on his sugar, without being conscious of the fact until he analyzed the different sources of profit and loss. We must, there- fore, before we can arrive at a correct appreciation of the relative influences of the changes in volume and value in the whole of the exports, make large deductions from the value of the earlier years on account of these exceptional prices. But yet another correction of the figures is needed. Many of our articles of export are manufactured from materials of foreign gi-owth, the cost of which varies con- siderably at difterent dates ; and any accurate comparison between the values of the finished exports at the two periods requires those values to be reduced by the sums paid for the raw material of which they are composed before the relative rise or fall in price or quantity can be rightly 244 ON THE DECAY IN THE EXPORT TKADE estimated. Cotton is a prominent example of this, and it so happens that its cost varied very much in 1872 and 1873 from what it did in 1877, 1878, and 1879 — viz., 84s. I id. and Sos. yl. being the average price of importations in the former years, 58.S. jd., 56s., and 43s. id. in the latter. In the following table (II.) there are shown, for each of the three periods which have been already brought into comparison, the actual effect upon the collected values of the seven specified classes of articles, of the inflated prices of coals and iron, and these, together with the estimated cost of the foreign cotton used, have been deducted from the earlier years, in order to obtain a fair net value for com- parison, the cost of cotton being in like manner deducted from the later years. All minor variations in the value of the articles influenced by the coal and iron employed in their production, or entering into their composition, have been disregarded, although in the aggregate these must be far from inconsiderable. The influence also of the price of raw cotton on the values of the many articles of export, such as wearing apparel, haberdashery, &c., and also the efiect of the lessened cost of other foreign materials used in the manufacture of other export goods, has not been reduced to figures. The total values thus brought into comparison are for 1873 £lI3'88, with £98^02 in 1877, showing a fall of £i5"86, or at the rate of 13'9 per cent. For 1872 £126-41, with £95-62 in 1878, a faU of £30-79, or at the rate of £24-4 per cent.; and for the first half of 1879 £60-77, witli ^43'46, a fall of £17-31, or 28-4 per cent. We arrive then at this result : that in the first period a fall of £15-86 must be divided into £13-76 due to price, and £2-10 to quantity, or in the ratio of very nearly 6 to 1 . In the second period £30-79, into £16-67 to price, and £14-12 to quantity, or the ratio of 13 to 11. In the third period £17-31, into £10-43 to price, and £6-88 to quantity, a ratio of VI h to 11. OF THE UNITED KINGDOM. 245 Table IL [In Millions £"8 to two decimals.] 6 Mo. 1873. 1872. 1872. Value of Specified Articles£167'52 £176-75 £83-46 Deck. Glial £^'M ...£4-06 ... £ro7 Iron I3"i7 •■• 9'28 ... 4-12 Cotton 3400 ... 3700 ... I7"50 . 53-64 50-34 22-69 Net value for Comparison... 113-88 126-41 6077 6 Mo. 1877. 1878. 1879. ;^I25-02 ;^I20-62 £S\9^ Less Cotton 27-00 2500 11-50 9802 95-62 43-46 ^ct. Fall in Value 15-86=13-9 ^ct. 30-79=24-4^ct. 17-31=28-4 Due to Price 13-76=120 ,, 16-67=13-2 ,, l(»-43=17-0 „ Quantity.... 2-10= 1-9 ,, 14-12=11-1 ,, 6-88=11-4 Two or three observations on these results may be made in passing-. First, that these several deductions from the values of the respective years really account for some con- siderable portion of the lessened total amounts for which the products of our industry have been sold, or rather at which they have been valued. Thus, still keeping to the specified articles, at first sight it would appear that a trade amounting to £167,000,000 in 1873 had dwindled to £125,000,000 in 1877, or a reduction of £42,000,000, whereas the real difference in value was but £ 1 6,000,000. That amounting in 1872 to £177,000,000 had apparently sunk to 121 millions in 1878, a fall of 56 millions, but should only be deemed to bo 31 millions ; and that of the first half of 1872, amounting to 83 millions, had been lowered to 55 millions in 1879, or 28 millions; whereas 17 millions will represent the real extent of depression. Viewed in this light, the severity of our loss in export trade is con- siderably mitigated. In the second place, however, it must be admitted that there is no abatement, but rather an increase, of diminution in the actual net amounts we are receiving from the sale of 246 ON THE DECAY IN THE EXPOIIT TKADE our commodities. Sixteen millions in 1877, 31 millions in 1878, and 17 millions for the first half of 1879 afford no indication that the tide is ceasing to eljb. Thirdly, if the comparison of one year's export trade with that of its predecessor affords no grounds for satisfaction, neither does comparison with our imports give much or any reason for congratulation. It is true that the balance of trade — or the difference between the sums we have to pay for the things we buy, over and above that we receive for those we sell — is each year lessening, but solely for the reason that our imports are decreasing in value faster than our exports are. Much of this arises from falling prices, and, happily, in part, from the diminution in the amount of grain we have this year [1878-9] required from abroad; but it is an undeniable fact that we are taking lesser supplies of the raw materials which form the staples of our industries both for home and foreign use. It is well to practise economy in consumption when the necessity arises, but real prosperity is to be looked for in an increasing sale of our manufactures, leading to an increasing demand for the mate- rials from which they are formed. Reverting, however, to the main question : these figures, if they have any value at all, demonstrate the fallacy of the too often expressed opinion that the diminished value of the goods exported lies altogether, or almost wholly, in the fall of prices. They distinctly prove that which the experience of merchants and shipowners has already told them — that there is a very serious lessening in the demand for our produce and manufactures. It may not be shown in cotton or jute manufactures, but it is in linen and woollen, to an extent which far outweighs any growth in the others. Coals, too, do not diminish in quantity, nor does copper ; but in iron it assumes proportions so alarming that we may well welcome with joy the hopes now expressed that American orders to this town are the heralds of approaching revival. If, then, it be impossible to deny that the lessened value OF THE UNITED KINGDOM. 247 of our exports is not confined to a general fall in prices, there are two reasons amongst others with which many seem to be satisfied. The one is that the change is not so much in the real value of the articles as in that of the gold by which that value is estimated — that an appreciation of gold is taking place, in consequence of which its purchasing power is increased. The answer to this assertion is simple. If such were the case, the rise in price would apply to all articles equally, whereas there is no such equable or uniform change of prices as would indicate much alteration in the value of gold. The fluctuations are too great to be due to any such cause, at any rate in any marked degree. The other reason given is that prices are everywhere falling, and must soon rise again in like manner. The reply to this is not so easy; for it is apparent to all that this alteration of prices docs not arise from causes so deep-seated as to render a recovery from them very doubtful. One thing is certain, that at the present time we have to part with a much larger quantity of goods for each sovereign we obtain, and that notwithstanding we do this, the number of sovereigns we receive is continually growing less. It is not the purpose of this paper to enter upon an examination into the causes from which this decay of our trade has arisen, nor to inquire by what methods it may be met or reversed. This has been done to some extent by the writer in papers read before the Statistical Societies of London and Manchester, the discussion on which has been full. Briefly, however, it may be stated that the first step is retrenchment. The country must consume less. It is not one class alone, but all classes who have been inflated by prosperity, and become extravagant in expenditure or waste. It must then strive to produce more, not of those things which foreigners decline to buy, but of those which wo at present buy from them, until they learn the folly of shutting out our goods to the detriment of their own pro- ducers of the things we are willing to take in exchange. Yet another course is open to us, dependent as we are for 248 ON THE DECAY IN THE EXrORT TRADE our food upon foreign supplies, and, should the demand for our manufactures still continue to decline — over-full as we shall bo with population at home — we must occupy the vast regions we possess abroad, and thus raise up new customers with whom we may exchange our goods, to their advantage as well as ours. But there are not wanting those amongst us who, whether from their place in Parliament, in the columns of the public journals, or through the medium of such Associations as this and others, openly advocate a reversal of the com- mercial policy under which our country has risen to its late pi'osperity. At one time under the specious claim for reci- procity, at another under the bolder plea for protection, they seek to bind again the fetters from which trade and commerce have been emancipated. To assertions such as they make, with no little shoiv of soundness, we owe much of the growing desire for either reciprocity or protection, and these are greatly aided by the injudicious arguments of free-traders themselves. These too often forget that free trade is not an active but a negative principle or policy, and they claim for it all the success which has followed its adoption. Now, free trade confers no advantages or powers which were not previously existent ; it but removes ob- structions to the development of that which is inherent in those whom it benefits, and had it not been for the discoveries of gold and the adaptation of steam, combined with the gifts of nature and the acquisitions of science, the introduction of freedom of trade could never have given us the pre-eminence in manufacture and commerce to which we have attained. The exclusive possession of these is now contested by other nations, and will be still more so when they too shake off the self-imposed bondage of a restrictive policy. In a country like ours, which is absolutely dependent upon the produce of other lands for the maintenance of the life of its population, and can only obtain the food which that life needs for its sustenance by the sale of its manufactures abroad, the fullest and freest expansion is necessary. The OF THE UNITED KINGDOM. 249 home trade can never flourish if the foreign be destroyed, for much of the one is but the distribution of the surplus wealth which the other creates. Let protection be accorded to the mechanic who devotes his labour and skill to the production of the articles which he exchanges for the food grown for him at home, and it cannot be denied to the agriculturist who grows that food. Let the food of the man who labours for the foreign market be taxed, and he can no longer compete with the foreigner whose food is untaxed, and thus he will cease to be a customer for the produce of the protected agriculturist. It is plain, however, that our commercial relations — and with them, too, our political and economic conditions — are being exposed to a severe strain, the continuance of which is probably not yet approaching its end. It is an ungrate- ful task thus to take the pessimist view, and in so doing to be exposed to suspicion ; but the true philanthropist, the real worker for his country's welfare, must not, therefore, shrink from laying bare the actual position in which its trade and commerce stand, if thereby he can arouse attention to the latent sources of evil which lie beneath the surface. Let us but fail to recognize our faults, to unite in learning the lessons which chastisement is designed to teach, to promote that spirit of unity and concord in thought and action which can alone enable us to stem the current of adversity whilst it lasts ; and we shall see the nations whom we have hitherto led in the progress of civilization and wealth stepping into our place, and enjoying the supremacy we shall renounce. XII. On the Social Aspect op Teade Depeession.' THE depression of trade under which the country suffers has continued for so long a time, exists under con- ditions so different from those of any preceding seasons, and is as yet so unmitigated in its severity, that it may well be said to form an epoch in the commercial history of our country ; the more so that it is now accompanied by an equally serious state of depression in agriculture. Whether this sister form of suffering be the occasion or the result of that which affects trade, or whether it be a fortuitous occur- rence that the two should accompany each other ; there can be no question that it complicates the matter greatly, causes it to exercise a greater influence over a wider area than did either exist without the other, and renders the present period a more marked one as it affects the social position in which the country stands. An inquiry into the special facts relating to either trade or agricultural depres- sion falls properly within the province of the statistician, just as the investigation of the causes from which they spring, and the remedies with which they should be met, belongs to those who are versed in the principles and practice of political economy. Although neither of these lines of research lies without the range of subjects which may be followed by a Social Science Congress, it is not with them that it is proposed to deal on this occasion ; but ^ Read at the Meeting of the Social Science Congress, Manchester, 1879. SOCIAL ASPECT OF TRADE DEPRESSION. 251 rather to take the condition of things as they now stand, and to consider briefly the social state as thus presented to our view. Some little allusion, however, to the history of the case, and some attention to its special circumstances are absolutely necessary to an understanding of the social con- dition we have to consider. It has been noticed by many that crises such as these are of periodic occurrence, inflation being followed by de- pression, and adversity giving place to prosperity, at intervals of ten or eleven years ; and the fact that these periods are coincident with marked appearances on the solar disc has been thought to show that, in some way or other, there is an intimate connection between the spots which darken the sun's visage and the gloom which over- spreads the mercantile world. It has even been started as a theory, by no mean authority, that the abstraction of the sun's heat so lessens the earth's fertility as to diminish the amount of food produced, depriving consumers of their power to purchase our manufactures, and thus deranging the whole course of our trading and manufsicturing opera- tions. But apart from the circumstance that the present depression has been growing for at least half of the supposed cycle, and even if it have yet reached its maximum growth must necessarily occupy some years in the process of pass- ing away — thus filling up the whole or nearly all of the period allotted to both depression and inflation — the cha- racter of the present times is so different from that of any which have gone before, as to suggest a different origin, and to predicate a diff'ercnt course towards recovery. On former occasions some national drain on our resources, or some natural loss of production, has pushed us downwards, or some sudden accession of wealth, or unexpected openings of new channels for trade have borne us upwards, until the force of cither being spent, we have been unable to sustain the elevation we had reached. These have been temporary ebbs and flows of the same tide, but now there seems, besides all these, to be a steady current setting to leeward. 252 ON THE SOCIAL ASPECT which, unless wo can find means to resist or to turn it, threatens to strand us amongst the breakers which far- sighted thinkers seem to discover ahead of us. If this be so, it is surely important to know from whence it comes and whither it is tending ; and it may not be useless to inquire whether, paradoxical as it may appear, it is not this : that whereas in former times the streams of produc- tion and consumption, though not always flowing with uniform velocity, did yet keep average pace with each other ; of late years consumption has sped faster than pro- duction — consumption, I mean, of that which is absolutely essential to continued sustenance of individual and national life. Hence, amidst all our abounding wealth, we are in no little danger of absolute poverty. The tenants of a besieged fortress may possess no end of gold or treasure, and yet perish for lack of bread. The State which con- sumes more of the necessaries of life than it produces may have accumulated any amount of capital by past industry and trade, and yet be in abject want if that capital be not held in a form which permits of its exchange for the means of subsistence. In the earliest stage of the world's history, when, as we believe, but two individuals were in existence, and the earth ceased spontaneously to produce the requisite supplies of food ; it was ordained, " in the sweat of thy face shalt thou eat bread," and the condition on which man's life depended was that he should " till the ground." When, again, popula- tion was reduced to the eight who emerged from the ark to " be fruitful and multiply and replenish the earth," the green herb of the field needed the husbandry of a Noah ; the wild flocks of the plain were to be hunted by a Ximrod and an Esau ; and the cattle of the fold to be tended by a Jacob. The three necessaries of life, food, raiment, and shelter, could only be procured by the bestowal of labour ; and in a barbaric state of life we may well believe that little else resulted from the employment of man's powers. Each individual family or community had to produce for itself OF TRADE DEPRESSION. 253 that which it consumed, and could only exist or increase as production was kept up to, or in excess of, consumption. As, however, knowledge and civilization advanced, the economy of labour and the aid of art enabled more to be produced than there was a need to consume, and production took the form in a great measure of that which ministered to comfort, to luxury, to the increase of wealth. The strong, the thrifty, the wise became the possessors of wealth, or devoted themselves to the production of that which they could exchange for the means of sustenance ; and so far as the necessaries of life were concerned, man- kind became divided into the two great classes of consumers and producers. It mattered not, then, whether each indi- vidual or community produced food or other essentials for his or its own consumption, provided he either had or pro- duced that with which these could be purchased. Two things, however, were absolutely requisite — that the neces- saries for the whole should be produced by some one or more, and that those who did not produce for themselves should be able to induce or compel the producers to part with their superabundant stores. Bearing in mind these principles, but not stopping to trace their application to the progress of our country in knowledge, civilization, and wealth, we find that she embraces three classes in her community. Those who produce nothing themselves, but, either by inheritance or the power of ministering to the wants or tastes of others, obtain their share not only of the necessaries but the super- fluities of life ; those who produce that which they can exchange for what they need ; and those who actually pro- duce these necessaries, not only for themselves but for the other members of the community. So long as in any country these three orders can maintain their due relation to each other, and sufficient labour is employed in producing the means of subsistence, it may prosper and increase in wealth, because the labour employed produces more than is consumed, and the surplus goes into accumulation. It 254 ON THE SOCIAL ASPECT may be that some have too little, and some too much ; there may be unnatural and unhappy diversities of con- dition amongst its members, but as a whole it goes on and prospers without external aid, or such aid as it derives from abroad in the acquisition of substance is compensated for by the products of its art or its industry. Advancing one step further : just as to the individual it is of no conse- quence whether that which he produces — be it the product of the hand or the brain — is suited to his wants, so long as that which is so suited is produced by others and procured by exchange ; so to the country it mattered not whether its products were such as its consumers needed, or such as were sought by other countries in exchange for that which sup- plied these needs. In such case the producers of that which procured food and necessaries really stood in the same position aa those who directly produced these essen- tials ; but it was absolutely requisite, not only that the supplies for consumption could be obtained, but that they should be obtainable by means of the products of labour so bestowed as to produce what was disposable in ex- change. Now England, by which is meant the whole United Kingdom, is just in that position. For a long series of years she fed herself, and obtained the further supplies she needed by exchanging her products for those of other nations ; and, owing to her capital and power, obtained them on advantageous terms. Then, though from the growth of her population and the increase of individual consumption she became dependent upon other lands for her necessary supplies of food and other articles, she was still independent and prosperous, because those lands re- quired and obtained from her the products they took in exchange for the supplies they gave. Now, whether it be for a time only or in perpetuity, many of the products of our industry and skill have ceased to be convertible into those supplies ; and thus the balance has been destroyed. We are at the present consuming more of that which is OF TRADE DEPRESSION. 255 really or conventionally necessary for our subsistence than we are either directly or indirectly producing. Hence the rapid spread of adversity and the deepening cry of distress from all ranks and classes of society. It is the social aspect of this national condition which forms the proper subject of this Paper, and apology is needed for so long a digression from it. One word more, however, must be pardoned. This statement of the case is fully open to criticism, but to shelve it under the cry of pessimism, anti-free-trade, protectionism or reciprocity- heresy, is as absurd as it is unjust. If the evils exist, and who can deny that they do ? let us honestly and carefully try to discover whence they arise and in what manner they may best be dealt with. It was in the years 1872 and 1873 that our trading pro- sperity appeared to have reached the greatest elevation it has ever attained, since when to the present time it has been continuously falling. Just as we may best estimate the unknown depth of a mountain valley by comparison with the height of a known hill, so may we best gauge the trading depression by contrasting it with the late elevation. The height of the one we know, for we have been descending rapidly ; whether we have yet touched the lowest depth re- mains to be seen. There are not wanting grounds for hope that it is so ; but the existence of any solid basis on which to rest a settled belief is not yet clearly visible. During the whole series of years that have elapsed since she entered upon her career as a trading and manufacturing nation, besides accumulating the products of her own 8ur])lus labour — the surplus beyond that expended in raising the means of subsistence for her own labourers — England had been drawing to herself a considerable portion of other nations' produce. At one period, by force of arms, con- quering peoples weaker or less civilized than herself and taking tribute from them ; not as of old by actual forced contributions to her revenue, but for the support of her officers and servants administering the government, or from 256 ON THE SOCIAL ASPECT the gains of her trade ; both of these to a considerable ex- tent being remitted home in the shape of produce. It is, however, doubtful whether there is ever any permanent ac- cession of wealth from conquest, for the waste of life, the outlay of money, and the expenditure of power, really con- sume more than they obtain. At another, by the discoveries of the precious metals gaining the power to purchase, though here again it is more than probable that the labour expended in searching for — and the lavish waste of — the gold and silver when found, have really been equal to the value secured. At other times — and this with varying seasons of productive or unproductive trade, though, on the whole, more of the former than the latter — exchanging the products of her own industry for that of others, or increas- ing the value of those products by the further employment of skill in fitting them for use. By all these means there has been a constant addition to her own wealth. She may have given ample return to those from whom she drew these accessions by the introduction of art and science, the esta- blishment of order, the development of resources, and the ad- vancement of civilization, morality, and religion; but there can be no question that England has, and still does acquire and retain, by appropriation to the purposes of her own con- sumption, enjoyment, or accumulation, a large share of the labouring power of the world. How great a portion it would be a curious and not uninstructive statistical employment to estimate and compile. It is to this constant absorption of the results of other men's labours, as well as to her own internal progress and appreciation, that England owes the supremacy she obtained and the social position which so distinctly marked the period of her inflated prosperity. At first, the conquerors and the actual residents in, or traders with, foreign countries or our colonial possessions, were those who thus became benefited. Then the capitalists and manufac- tui'ers through whom were produced the staple articles of our commerce ; then the artisans by whose manual labour these were created, and the labourers and seamen OF TRADE DEPRESSION. 257 employed in their transport, all claimed a share in the profits of our foreign trades. Then followed the owners of land and of the mineral products derived from under the soil, who exacted increased rents and royalties. Following upon these came all those who lived by collecting and distributing what others produced or consumed, and the professional class who ministered to the wants, and lived upon the ex- penditure of those who thus grew rich. Beyond all these must be named the horde of speculators, many honest and useful in the exercise of their foresight and talents, but many rapacious and dishonest in grasping that which other men had exhausted their bodily and mental powers in pro- ducing ; sweeping into their nets the savings of a lifetime laid by for the support of old age, or the hardly-won pro- vision for those dependent upon the bread-winner whilst living, and that which he left behind him when taken away. There thus arose a general diffusion of wealth ; an almost universal rise of prices ; an extravagance of expenditure, not confined to any class ; a greed in the race of acquisition, and a recklessness in the means by which it was obtained ; an unscrupulousness in the transactions of every-day life which exercised influences of the most unf;ivourable character upon the conditions in which society existed. Easily acquired wealth was lavishly squandered ; dishonest gains were hoarded by the miser, or dissipated by the spendthrift ; every form of luxurious living and sensual gratification was adopted, invented, and indulged in. Nor was this all ; those who had by the most upright conduct, the most patient exercise of talent, the most assiduous devotion to the lawful employment of their powers become possessed of property or income — and especially those whoso fixed incomes admitted of no aug- mentation — were drawn into an undue expenditure either actually or in desire. Habits were being formed, plans in life pursued, time and substance employed, in methods which, however pleasing and even elevating to tho few, were by no means calculated for the real advancement even s 258 ON THE SOCIAL ASPECT of those fevy, still less of the many who form the bulk of the nation. Just as England herself appropriated more than her fair share of the world's substance, so was her portion of that wealth unequally distributed amongst the different members of her own community. Extremes of affluence and destitution — the continuance of which are wholly incom- patible with any real prosperity — existed side by side. It would take too long to trace out the relation of cause and effect ; but it is too true, that between the satins of St. James's and the rags of St. Giles's, the luxurious living of Belgravia and Manchester and the squalid misery of the courts and alleys in their immediate proximity, the trifling loungers of Pall Mall and the nightly throngs of the Hay- market, there is a much closer connection than many know or will be disposed to admit. The social aspect of trade inflation was unsatisfactory in the extreme ; it carried with it the absolute certainty of its own overthrow. Now the point upon which all this turned was the con- tinued progress of our export trade. With a constantly in- creasing population to be fed, and a stationary or retrograde home production of food, our very existence depends upon our ability to produce that which other nations will exchange for food ; and this dependence is the more entire in propor- tion to the increase of average consumption which has grown up with our growth in wealth. In like manner with other necessaries, or those things which habit or education lead us to consider to be necessary. No doubt we have large re- sources abroad in the shape of debts on which interest is paid, shares in undertakings which may be profitable, earn- ings and profits remitted by residents abroad ; but there is no reason to think that these have of late years been increas- ing — rather the reverse. It is to the results of our export trade that we must look for the means of turning the labour at home which is not employed in producing the necessaries of life into those products to be obtained from abroad. Other conditions may possibly spring up : such a wonderful discovery of new sources of wealth like that of gold in OF TRADE DErRESSION. 259 Australia; some new dovelopment of agricultural operations at home, whereby the labour now employed in other channels may be diverted to the production of supplies to supersede imported ones ; or some unexpected diminution in our pre- sent draughts upon the world's resources. But failing- any such alterations, the decay of our export trade must involve an entire change in our social condition, and not impro- bably nor remotely our decadence as a nation. It is with no intention of maintaining that this decay must necessarily continue or increase, that on this and on other occasions the real circumstances are sought out and insisted upon. Kather is it desired to direct attention to the facts of tho case, so that whatever means can be adopted to alter exist- ing conditions may be taken in hand. What those means are cannot now be inquired into ; but the alterations which have taken and are taking place in our social condition may bo discussed. A few words, however, as to the way in which this decay has been brought about. It would be unreasonable to expect that, however willing the nations of tho world might be in their infancy to depend upon this country for their inanufoctured goods and the articles of luxury they choose to consume, they would con- tinue to purchase them from us by a larger amount of labour bestowed upon the raising of food and raw materials, than we bestow upon the finished articles they take in ex- change. We have had the honour of being the pioneers in arts and manufactures, and have had our reward in tho wealth we have acquired. It is now the turn of other nations to follow in our steps, at least to the extent of sup- plying their own wants ; and this they are sure to do aa they increase in numbers and knowledge. We can have no hope of retarding this progress, but we may repeat tho pro- cess by which we have hitherto succeeded in advancing our own interest — that of civilizing tho nations yet existing in barbarism, of peopling the regions yet uncultivated by man. We have no right to expect, for instance, that America will continue to purchase from us the coals and tlio 2 GO ON THE SOCIAL ASPECT iron she has within her own shores, or permit us to fetch from her the raw cotton her fields produce, and take back to her the calico or the hosiery to clothe her population ; but we may abstain from exterminating the naked races who would raise us food in exchange for our clothing. We may laugh or mourn over the folly to themselves and the injury to us, of the United States^ policy in retarding their own progress by refusing to take our products in exchange for their surplus food, until they are able under free trade to supply their own wants ; but we may not in imitation of this revert to the suicidal policy of resorting to protection or reciprocity. It is certainly not in this direction that we can in any way advance the return of trading prosperity, or retard the progress of trade decay. It is by the throwing open of our ports for the reception of whatever the world will send us, that we have fed our population and enabled them to cheapen the goods we have to sell; and just in pro- portion as we stand in need of customers for our manufac- tured products, must we maintain or extend the facilities for the interchange of that which each nation can or does produce in perfection at a low cost. It is so much easier to affirm the positive than to state the negative, to observe the object which is displayed in relief rather than that which is cut in reverse ; that it is hoped what has been said of prosperous trade may, in some measure, present to view what adverse commerce means. Yet there are some of the aspects of trade depression which, in piu-suance of the object of this Paper, must be distinctly set out and briefly enlarged upon. It would appear that a serious social revolution is im- pending over us, or rather we may say has already com- menced in our midst ; and is only not more distinctly visible because everybody is living in hopes that the present de- pression is but for a time, and even now gives prospect, as many think, to a revival of trade. No one can dispute the vast falling off in the value of our exports. Whether this be duo principally, or only in part, to a diminution of price, and OF TKADE DElTvESSION. 261 not of quantity, has been argued elsowhero. Even were it wholly due to the fall of piiccSj it would still remain true that the nation^s resources must be greatly diminished, and the fact that our manufactures can only be sold for so much less money does not alter the state of the case. It is said also that this evil is not confined to England, but has fallen upon other nations as well. Bo it so, the effect on their prosperity is not so serious as on om-s, because in no other nation is there so large a portion of the community dependent for subsistence upon the proceeds of trade ; for none other has to rely so much upon foreign supplies of food. There is also a wide diflference in the effect of depressed prices of goods for foreign and for home consumption. The one absolutely lessens the purchasing power of the nation, the other, how- ever it may for a time disturb and afflict the home traders, is really only a question of internal regulation, entailing no loss on the country, though playing an important part in settling or unsettling the social relations of its different members. The first effect of lesser money return for the same quan- tity of goods must obviously be felt by the manufacturer, since the standing cost of plant, &c., cannot be materially reduced, and wages do not fall until profits are diminished or altogether cease. It is generally admitted that at the present time few of the manufacturers of our staple exports are keep- ing up their gains : it is fortunate for many if they are not actually working at a loss. The spending power of this class must thus be greatly lessened. That this is not yet mani- fested more clearly in their expenditure arises from the vast accumulations of prosperous times having been placed in various investments not yet so completely affected, and that many are actually drawing upon capital to tide over disas- trous times. The next in order to suffer are the labouring classes, who are everywhere compelled to accept reduced wages, and thus become able to spend less. These two classes necessarily affect the shopkeepers, from whom they purchase. These, again, the traders and manufacturers from 2G2 ON THE SOCIAL ASl'ECT whom they obtain their goods. Then come the landowners, whose hirgely-incrcased incomes of late years have been occasioned and sustained by the general desire of those acquiring fortunes to become occupiers of the soil, and the lavish prices which prosperous trade has enabled them to afford. The professional class and all whose receipts come solely out of the incomes of others, having during prosperity been large recipients, must gradually share in the failing wealth of those by whom they have been sup- ported. So far as actual loss to the nation is concerned, agricul- tural depression (excepting as it arises from diminished production — and this, owing to the succession of bad har- vests, is of immense importance — though not falling within the scopeof this Paper) has really nothing to do with it. There can be no ground for believing that for a series of years nature will yield less abundant supplies than formerly ; and so long as on the average equal labour expended upon the soil produces the same return, there is the same amount of sustenance for the population. Not so, however, when our export trade falls off. If it be in quantity, there are fewer hands employed to produce it; and if in price, less return. In fact, the labouriug power both employed and unused procures diminished supplies of necessaries, and an actual loss ensues to one or more classes of the community. It is the fewer millions of money which our exports have pro- duced, to be set against the more millions we have expended on imports to meet the growing numbers, and the increased average consumption of those numbers, which makes the real difference between national prosperity or adversity. Should the times recur when the same employment of labour, in- creasing with the addition to the population, will purchase for us supplies from abroad to a proportionate extent, the social condition of the country may remain unchanged ; without such conditions it cannot do so, and even with them such a result is highly improbable. Let it be supposed that our manufacturers and traders OF TRADE DEPRESSION. 263 should have as full employment as before — to secure which there must be an increase in the total amount, not only com- mensurate with that of the population, but also of the con- stant ascension from the lower ranks — there is no reason to suppose that it can ever be as profitable as it was. The producing power of the world has been and still is increasing in a higher ratio than the consuming need, and hence pro- ducers can never expect to command the same surplus of profit for themselves on the sale of their manufactures or the conduct of their trade. The continuous and probably increasing loss of income to the higher classes will neces- sarily alter their style of living, and with this their relative social condition. But other causes put in operation by this prime mover will all tend in the same direction. The very largeness of the mercantile and manufacturing firms which have come into existence has led to the formation of com- panies and the general spirit of co-operation, which distri- butes incomes amongst larger numbers. Diminished incomes necessitate a resort to employment by many who have hitherto had money to spend without earning it, so that more will press forward to divide the profits earned. All the old methods of making a business are becoming overtasked. The peculiar means this country possessed of drawing to it the trade of other nations are now being shared with them ; and amongst ourselves it will rarely happen that any new business will exclusively remain long in the hands of those who first start it. When all were full of employment the special ground which one man or firm occupied, as we have many instances in our lai'ge trades, was left to himself; now competitors spring up on every side. The possession of capital gives far less power than it did before the existence of facilities for obtaining money where- with to manufacture or speculate. It is thus tolerably cer- tain that*" the enormous fortunes hitherto so frequently made will not arise, nor will our landowners have the same large amounts at their disposal. In every way the social condition of both must thus be clianged. 264 ON THE 80CIAL ASPECT With such materially reduced expenditure must go the means of those who have lived upon the trade of the rich — shopkeepers and other distributors will be lessened in number, and their gains contracted. These then will press upon the working classes, for whom fewer employments will oflFcr and to whom lesser wages will be given. There will be less money to spend and more frugality to be exer- cised. Another cause will, it is to be hoped, come into extensive operation. It is impossible not to have seen that in all classes of society the success of those who have prospered in life has in great measure been owing to the ignorance, the folly, or the vice of those who have failed. The advantages and opportunities offered to the many have been embraced by the few ; and excepting in instances of exalted genius, rare skill, or extraordinary circumstances, few men would have risen to eminence or fortune but for the indisposition or incapacity of their compeers to divide with them the success they have obtained. If education, morality, and religion are to increase, many more must be qualified to obtain the prizes, and there must be a more equal division of the benefits which man's labour, his own or others', can create. If this be true as regards individuals and families amongst ourselves, it is also true as regards nations. England's prosperity has been owing not only to the in- dustry, the skill, and the energy she has put forth at home and abroad, but very much to the folly of other nations in neglecting the resources they possessed and wasting their substance in war. We too have had our share of this in time past, and are not free from its indulgence now; but since the days which closed with Waterloo, and again with the termination of the Crimean War, all our rivals in manu- facture and commerce — America, France, Italy, Germany, Austria, and Russia, as well as every minor State, excepting perhaps Switzerland, whether in the East or the AYest, or this side of the Atlantic or the other — have retarded their own progress, and thus left room for us to advance, by the OF TRADE DEPRESSION. 265 wholesale destruction of life and tlio products of life's labour. It is the peace which Franco seems determined to enjoy which is enabling her to exercise her powers in sup- plying so much to our markets, and yet take less from us ; whilst the United States, no longer cursed with slavery or dissevered in interests, is able to advance rapidly in fur- nishing herself with manufactured goods, and to spare us of the food sho raises. To these happy causes are owing much of the check which our manufacturing efforts are receiving. It is not forgotten that with these social changes — should the present promise be realized — there will bo a large addi- tion to the present overstocked labour market, and that tlio problems will have to be solved how that labour is to find employment, and how those who yield it are to find food. But it must be remembered that with less wasteful and luxurious living, whether it be in the destruction or misuse of food, or the awful extravagance in drink which are in- dulged in by both rich and poor, there will be enough to fill many mouths. There is a certainty that with lesser wages and smaller profits, together with greater honesty in tho processes of manufacture and the conduct of trade, we shall find for a time at least many customers, especially amongst the least civilized people, who will be ready to grow food wherewith to purchase our clothing and other productions. It is not impossible that our own soil may be made to yield a larger supply ; and if that fail, who shall estimate tho countless multitudes for which food can be raised in our colonies when our superabundant labourers go forth to people their fertile valleys and their sun-clad hills ? To come back to the point from which we started, Eng- land has for a long series of years appropriated and ex- pended in consumption and accumulation the proceeds of a larger share of tho world's labour than she has herself con- tributed. This she has been enabled to do through the force of her Anglo-Saxon character, her early discovery of the mineral treasures she possessed, and her power to utilizo 2G6 SOCIAL ASPECT OF TRADE DEPRESSION. thorn ; her indomitable perseverance in seeking out and occupying new places for the employment of her energies, and new mai'kets for the sale of her products. By the main- tenance of peace and the cultivation of intercourse with all the world to a larger extent than any other nation which ever existed, by shaking off the trammels in which her trade was fettered, and thus giving the widest expansion to all her powers. Possessing, however, no special monopoly of any of these gifts, her success has induced other nations — especially those to whom she has herself given birth — to follow more or less in her footsteps, and thus to become suppliers of their own wants first, and then competitors for the custom of the world. Concurrently with this, the wealth which has fallen to her share has been unequally divided amongst her own children ; deservedly so, because the industrious, the wise, the thrifty, have only done to their fellows what England has done to the world. Nevertheless, the result has been an undue exaltation of wealth, an un- due desire for its possession, and the use of undue means for its acquisition. This struggle for existence — for the enjoyment by each of more than he himself produces — has per- vaded all classes, and both led to, and been fostered by, the inflated prosperity of the few years centring in 1871-72. Society has become divided into unnatural extremes, and a social condition grown up which is for the benefit of neither. It is utterly impossible for it to continue without the infusion of new life, or the obtaining of new support. These are to be found if sought for; but it is equally improbable that society can either continue on its old lines or fall back upon them again. If trade and agricultural depression together drive us into new channels of thought and action, prompt us to give play to new motives, and inculcate upon us higher principles by which to regulate our conduct ; they will prove the seed of a richer harvest of happiness, honour, and real glory, than all the accumulations of the past have ever yielded. XIII. Extended Colonization a Necessity to the Mother Country.* THE Paper which I have had the pleasure and privilege of preparing for this evening's meeting differs some- what from those which are usually presented to the mem- bers of the Colonial Institute, inasmuch as it neither con- tains information respecting any portion of our Colonial Empire, nor does it treat of the subject from a Colonial point of view. It is the sequel to a series of papers read in other places on the trading condition and prospects of this coun- try, out of which it would seem that there arises a necessity for action, with special reference to the advantages the Colonies offer as helps to the Parent State. Yet so closely are the interests of the children bound up with those of the parent, that whatever may prove to be for its welfare should also be the source or occasion of benefit to them. Some apology is needed fi'oin one who has so recently become a member of the Institute for attempting to deal with so wide and important a subject. I throw myself on your indul- gence for the incomplete manner in which it i^i treated, with the full expectation that it may at least serve to promote a discussion that will have some influence in guiding public opinion, and it may be, in invoking legislative action to- wards effecting the desired cud. I. The population of the United Kingdom in the ye.ir ' Read at tlic 0|icninf: Moetinn; of Session 1879-80, of Tbc Roval Colonial Institute, Noveniher '2't, 1879. 268 EXTENDED COLONIZATION A NECESSITY 1871, that in which the last census was taken, numLered 31,484,001. The estimated increase since that time has been 2,071,452, and a like rate of growth between this and 1881, when the next enumeration will take place, would give a further increase of 727,905, bringing up the total to very close upon 35 millions, for whom food, raiment, and shelter must necessarily be found. In 1871 there were 3,831,054 acres of land appropriated to the growth of wheat, the calculated produce of which being 53,020,000 cwts., was supplemented by importations from abroad to the extent of 43,310,000 cwts. Last year there were 3,381,701 acres, yielding, it is supposed, 55,350,000 cwts., and the foreign supplies were 58,760,000 cwts. This year the cultivation has been reduced to 3,056,428 acres, and it is probable that, owing to the bad harvest, the whole yield will not much exceed the half of last yearns production ; whilst the foreign impor- tations have already reached to 57,000,000 cwts., and there are yet two months of the year to run. Mr. Caird puts the annual home produce at 55,000,000 cwts., and the quantity taken from abroad at an equal weight, thus giving 110,000,000 cwts. as the present consumption. Other cereal products to some extent aid the supply of wheat, but, roughly speaking, they may be said to about compensate for the wheat devoted to other uses than that of human food ; and some 3,000,000 cwts. of rice are im- ported, of which, however, only a portion is eaten. Of meat it is supposed that 25,370,000 cwts. were raised in 1871, and an additional quantity of 3,960,000 cwts. im- ported. The same calculation gives 25,000,000 cwts. of home produce for last year, and 6,990,000 cwts. obtained from abroad. Butter and cheese may probably be taken at 3,000,000 cwts,, both now and for 1871, and the milk con- sumed as equivalent to 6,000,000 cwts. more. Adding this to the meat may make the weight of home-raised animal food 34,000,000 cwts. Of foreign butter and cheese, in- cluding lard, the impoi'tations were 2,930,000 cwts. in 1871, and 4,580,000 cwts. in 1878 ; together afi'ording a present TO TIIE MOTHER COUNTRY. 269 annual weight of 39,000,000 cwts. of animal food furnislied for the use of the whole population. Potatoes are another important article of diet, of which probably 100,000,000 cwts. are usually grown at home, whilst the importations were, in 1871, 850,000 cwts., and in 1878, 8,7-15,000 cwts. If we go back for another ten years to 18G1 it will bo seen that the population was then only 28,974,302, the im- portations of foreign wheat 36,200,000 cwts., of meat 1,810,000 cwts., of butter, &c., 2,010,000 cwts., and of pota- toes 112,374 cwts. There are no records from which it is prac- ticable — very satisfactorily — to calculate the various home products for that year, but it may be assumed that there were no great variations from the present average amounts. These several descriptions of food, however, have varying degrees of life-sustaining powers, according as they are rich or otherwise in the flesh-forming constituents they contain. For instance, it is generally admitted that 480 lbs. of wheat per annum are capable of supporting one person, whilst 550 lbs. of meat would be necessary for the same purpose, and that 10 lbs. of potatoes go no further than 1 lb. of wheat. In estimating, therefore, the extent to which the whole will avail in feeding our population, as well as in as- certaining tho proportion in which wo are dependent upon home and foreign supplies, it becomes necessary to reduce them to a common standard, and thus to express their worth as food in that of wheat. It is not necessary hero to show tho several calculations. The basis on which these, as well as the estimates of quantities, rest, will bo found in several ])aporK by Mr. Caird, Mr. H. Thorn ])son, and Dr. Play fair. Of their experience and judgiuent I availed myself in pre- paring a paper containing copious details, which will bo found in tho " Transactions of the ^Manchester Statistical Society for 1877. '^ ' Some extracts from tables given in a recent treatise published by Mr. Caird, near tho close of last year, form the following table, and I may perhaps be allowed ' Auto, pp. 76-102. 270 EXTENDED COLONIZATION A NECESSITY to appeal with some confidence to the figures set forth in my own paper when they are corroborated to so great an extent by the calculations of one who is justly deemed an authority in these matters : — Quantities and Values of Home and Foreign Agricultural Food Produce consumed annualli/, as estimated by Mr, Caird} [In million £'3 to two decimals.] Quantities. Values. Home. Foreign. Total. Home. Foreign. Total Wlieat Barley cwts. 55-00 44-00 6400 14-00 cwts. 55-00 11-00 12-00 500 20-00 cwts. 11000 55-00 7600 19-00 20-00 & 32-19 19-80 28-80 6-30 £ 32-19 495 5-40 2-25 7-00 £ 64-38 24-75 Oats 34-20 Peas and Beans Indian Corn 8-55 7-00 Total Corn . . 177-00 111-00 24-50 3-00 103-00 5-00 6-30 3-10 280-00 116-00 30-80 6-10 87-09 16-65 87-00 13-50 26-00 51-79 ■75 22-05 14-00 138-88 17-40 Meat, &c 109-05 Cheese and Butter. Milk 27-50 26-00 230-24 88-59 318-83 Reducing, then, the other articles to their equivalents in wheat, and adding the whole together, it will be seen that the two years 1871 and 1878 compare thus : — 1 " The Landed Interest and its Supply of Food." By James Caird, C.B., F.R.S. 1879. TO THE MOTHER COUNTRY. 271 [In million cwts. to two decimals.] 1871. Wheat Meat equal to Dairy produce Potatoes Wheat— value of total 94 1878. Wheat Meat equal to Dairy produce Potatoes Wheat — value of total. Home. Foreign. 53-62 43-31 22-16 3-45 8-00 2-38 10-00 •09 94- 49- 55-35 58-76 21-82 5-74 8-0 3-72 10-00 -87 95- 69- Total. 96-93 25-61 10-38 10-09 143- 11411 27-56 11-72 10-87 164- Per cent. Home. I Foreign. 55-32 86-53 77-07 99-11 66- 48-50 79-17 68-26 92-00 58- 44-68 13-47 22-93 •89 34- 51-50 20-83 31-74 8-00 42- For 1861 the totals would probably be 96- 39- 135- 71- 29- Dividing these totals of 135, 143, and 164 million cwts. amongst the existing population, they would show a supply of nutriment equivalent to wheat for each individual of 522 lbs. in 1861 ; 512 lbs. in 1871 ; and 538 lbs. in 1878; or an average of 524 lbs. Allowing for the export in various forms of prepared food, of perhaps 5 per cent., and for some waste, this weight comes singularly near to the 480 lbs. computed to be necessary for each person, thus supporting the presumed accuracy of the calculations. But besides these principal articles of food there are many others of smaller importance — eggs, vegetables, fruit, &c. — both of home and foreign production, which aid in supporting life ; and many, such as beverages, both alco- holic and other, without which, according to the habits of the people, life would be scarcely endurable. The former class is chiefly of homo growth, although the foreign is rapidly increasing in relative importance. The latter are mostly of foreign production. These are not capable of being dealt with in quantities, as we have previously done 272 EXTENDED COLONIZATION A NECESSITY witli tlio staple articles, yet a comparison of their collected values at the two periods may be serviceable; always re- membering that for specific dates the money value is not an altogether safe guide, because of fluctuations in prices. For a series of years they are safer. A table of these ex- tracted from the paper already referred to, and continued to 1870, will be found at page 79. One of a similar character taken from the Agricultural Statistics of the Board of Trade recently issued, which has this year for the first time thus grouped the various articles of food and shown their value, is as follows : — Values of Food Imports ft^om 1859-78, arranged in Groups, as sTiown in Official Abstract of Agricultural Returns, prepared by Mr. Giffen, of the Board of Trade. [In million &'a to two decimals.] Year. Total Value. Live Animals Meat, Cheese, &c. Wheat and Flour. Cereal, Sugar, Spices, &c. Beverages. Fniit and Vege- tables. Miscel- laneous. I. II. ni. IV. V. VI. VII. 1859 56-66 1-63 5-18 11-11 20-98 13-21 3-09 1-46 '60 78-79 2-12 9-05 20-87 25-45 16-00 2-93 2-31 '61 84-67 2-21 10-37 24-00 27-13 15-44 3-47 2-05 '62 91-00 1-89 11-82 28-59 24-47 18-21 3-60 2-42 '63 83-62 2-65 12-07 15-54 25-61 21-47 4-02 2-26 '64 82-83 4-28 13-08 13-51 25-61 20-03 3-64 2-08 '65 83-04 6-55 13-65 12-40 23-68 20-55 3-50 2-71 '66 94-03 5-84 14-93 16-78 28-06 22-70 3-79 2-53 '67 104.05 4-15 13-39 28-50 28-97 21-94 4-20 3-50 '68 98-13 2-70 14-17 24-90 33-77 15-38 4-64 2-57 '69 110-72 5-30 16-55 23-30 34-42 23-01 4-82 3-32 '70 106-42 4-60 JO-19 19-65 35-75 23-53 4-27 2-37 '71 125-68 5-66 18-50 26-82 38-20 27-53 5-32 3-59 '72 141-53 4-39 19-35 30-26 47-93 28-77 7-96 2-87 '73 149-48 5-42 24-38 34-39 43-60 31-00 7-43 3-26 '74 147-20 5-26 20-33 30-92 45-69 28-72 7-10 3-18 '75 158-65 7-33 28-04 32-38 47-75 31-01 7-55 3-99 '76 158-77 7-26 31-45 27-92 49-25 30-81 8-77 3-31 '77 178-23 6-01 31-23 40-69 55-50 30-45 10-22 4-13 '78 167-36 7-45 33-98 34-22 50-97 28-08 9-48 3-18 Total. 2,302-06 92-76 363-77 496-75 712-79 469-10 109-80 57-09 2sote. — The above Table includes all Imported Produce, whether for Home Consumption or Export, and does not comprise articles such as Guano and Chemicals, employed in the production of Food. TO THE MOTHER COUNTRY. 273 The totals which the table (page 79) displays for the two years stand thus : — [In million £'s to two decimals.] 1871. 1878. Animal Food £-23-53 £39-98 Cereals 4-2-(i0 or 30-86 60-11 or 47-11 Sugar, fruit, &c 22-0.5 29-15 Beverages, alcoholic 9-39 or 21-13 7-84 or 20-84 „ other 9-40 12 08 Miscellaneous 11-03 17-84 £118-00 £16700 The corrected figures for cereal and alcoholic are the re- sult of a deduction from the one and addition to the other of the value of the grain employed in distillation and brow- ing, thereby entirely changing its character. Mr. Caird thus compares certain of the above articles for the past year with those of home growth : — lldino. Foreign. Corn £87-09 £ol-79 Potatoes 1 () "(iS -75 Meat 87-00 22-05 Cheese and butter 13-50 1400 £204-24 £88-59 In one respect these figures fail to convey an accurate idea of the dependence upon foreign supplies, since a largo portion of the home meat and dairy produce is fed upon im- ported corn and other food, or on grass and roots which owe much to the aid of the manures and chemicals included under the head of miscellaneous in my foreign estimate. It may not be too much to say that one-half of the two items, cereal and miscellaneous, say £38 millions, should be de- ducted from Mr. Caird's home estimate, thereby reducing the total to £166 millions — very nearly the amount at which the foreign supplies are valued by me. Mr. Caird himself says in the book from which these particulars are quoted : " Wo now receive our bread in equal proportions from our own fields and those of the T 274 EXTENDED COLONIZATION A NECESSITY stranger ; " and again : '' This country thus derives from foreign lands not only half its bread and nearly one-fourth of its dairy produce, but must also depend on the foreigner for almost the entire addition that may be further required by an increase of its population/' Nearly two years pre- viously it had been stated by myself : " It may be safely inferred that our bread is equally of home and foreign origin ; " and, " The conclusion thus arrived at would ap- pear to be that for absolute sustenance we rely upon home and foreign produce in somewhere about the proportion of three to two fifths." Also : " On this computation, of the 33 million inhabitants of the United Kingdom, 18 mil- lions may be sustained on food grown at home, and 15 millions on that received from abroad." Since that date the proportions have somewhat altered, with increased numbers and larger supplies. Fortified by this concurrent testimony and the figures which have been adduced — at a length and in detail which must have been somewhat tedious, and would have been unnecessary but for the extreme importance of attain- ing to right conclusions on the subject — it is not too much to say that of the 35 millions which the next census will show as inhabiting these islands, at least 17 millions must be fed on food which is not produced at home. Further- more, that if the present rate of increase continue — since the whole of it must rely upon foreign supplies — in another ten years (and such a term is not too long for our statesmen to forecast) the seventeen will have grown to twenty, and thus fully if not more than one-half the inhabitants of the United Kingdom will be absolutely dependent for their existence upon foreign food. II. If, then, the food produced at home suffices for the wants of little more than half its inhabitants, two ques- tions arise : first, whether it is possible so to economize its use as to make it serve for the sustenance of a larger number ; secondly, what probability there is of success in attempting to increase its amount. TO THE MOTHER COUNTRY. 275 There can he little or no doiibt that the prosperity which marked our trading and manufacturing progress for many years has tended to much waste. Luxurious living on the part of the rich has in many ways led to the consumption or destruction of some amount of food, the distribution of which would have supported more lives, and in many house- holds there is an actual waste which it is painful to observe whilst there is any real destitution in the laud. The ex- tremes of high and low li\ang are far greater than they ought to be, yet it is pretty clear that any changes in this respect would but equalize consumption, since for those who consume unduly there are surely as many who suffer real deprivation or absolute want. We are not concerned now with the causes or the remedy, simply with the fact, and whether it have any bearing on the extent of available supplies. There is also an extravagant waste of food from ignorance, and indifference of and to the best kinds of food, the best mode of cooking it, and the proper seasons for its enjoyment ; but here, again, it is doubtful whether the diffusion of sound information or the adoption of right principles would produce any other result than equalization. If there are many who are badly fed from misuse, there are surely as many who are underfed because what they have is not wholesome or sufficient. Adversity may en- force the judicious use of the food we possess, and it is certain that there is enough supplied, were it properly em- ployed, to support vigorous life in all our people, but not more than may bo beneficially consumed by the whole. The gain would be great in health and strength, and the prolongation of life, more than in any power to sustain a larger number. One exception, however, must be made to these remarks — they do not apply to the wasteful destruc- tion of food by its conversion into alcoholic drink. A series of elaborate calculations show that during the twenty years ending with 1876, 581,000,000 cwts., giving an average of nearly 30,000,000 cwts. per annum of grain were thus converted into beer and spirits. A considerable portion 27G EXTENDED COLONIZATION A NECESSITY of this would be wheat and oats, capable of direct applica- tion for human food — all of it might have been converted into meat and eggs for the same purpose. Chemists tell us that the actual amount of nutriment left when thus changed in its character is insignificant, and we are justified in assuming that as food the quantity thus destroyed would be ample to maintain healthy life at the very least in some 3,000,000 persons. Could a change to this extent only — which would still leave untouched all the imported alcoholic drinks — be effected in the drinking customs of our country, this number might be transferred from the foreign to the home- supported portion of the population. Further than this, it does not appear that any better employment or more equal distribution of the existing home-raised food would assist the land in providing for the wants of those who occupy it. The question whether any alterations in the conditions under which agricultural operations are carried on would enable the land to support a greater number, is one of much wider range, and involves, as does also the one we have just left, not only the possibility, but, still more, the probability of such changes being affected. There are many who believe that amendment of the land laws would be followed by increased productiveness of the soil, because of the greater facilities which might be afibrded for its profitable working, and hence the larger amount of capital which might be drawn to this class of investments. Granted that this would be the effect of the desired legisla- tion, it does not therefore follow that a larger number of people would be thereby sustained. More would depend upon the kind of produce which would be raised in enlarged quantity. Of all the edibles for the growth of which our soils and climate are suited, the potato is that which will feed the greatest number per acre; but then the race it pro- duces and sustains is deficient in power, and if measured not by numbers but by capacity for work it yields less than others. The legumes are coming into credit as admirably adapted for economically sustaining both life and strength j TO THE MOTHER COUNTRY. 277 but, taken altogether, there is h'ttle likelihood that wheat will be deposed from its supremacy as the staff of life, whether from the weight which each acre will produce as compared with other descriptions of food, or from its fitness for man's consumption. Now, this is just the kind of crop which seems the most likely of all to be displaced by that of foreign growth. The acreage devoted to its cultivation has for years past been gradually diminishing, and the tendency of the present day is towards its restriction, if not its abandonment, as an article for the home farmer to raise. In 1871 there were 3,831,054 acres growing wheat, in 1879 only 3,056,428, and of this diminution 325,273 took place as between this and the last year. The throwing of land out of wheat culture into that of any other description of food, however desirable or profitable it may be for the cul- tivator, lessens the number per acre which it can feed. This is especially the case with a change from arable to grazing purposes, since for every acre of land on which wheat is grown, eight will be required to give the same amount of nourishment in the shape of meat. Fruit and vegetables, again, however desirable it may be on the score of health and enjoyment to extend their use, will not con- tribute anything like the same degree of sustenance as would be afforded by the wheat of which they take tho place. A prosperous and happy people will seek for more meat and green food, and be enabled to obtain more wheat from distant places, thus materially diminishing tho sus- taining power of the homo soil. Again, an increasing population and thriving trade absorb more land for the erection of buildings, tho means of transit, and open spaces for recreation, all of which must bo obtained at the expense of the food tho land can bring forth. There is thus every reason to wish fnr a restriction in the extent of surface thus employed, unless indeed it can be obtained by tho reclamation of that which is waste ; and there is no reason to expect more will bo dono in this direction than will be absorbed in others. 278 EXTENDED COLONIZATION A NECESSITY It is as yet open to doubt whether high farming and improved machinery or modes of cultivation will hold their ground against the vast tracts of unoccupied land being every day rendered available in other countries, and the increased facilities for bringing their produce to our markets. If they do, it will almost certainly be by the production of such foods as need to be raised near at hand, which are just those that require the larger space for growth in pro- portion to their food- value. There is one direction in which we are sadly deficient, namely, in not retaining and returning to the soil that which we have taken from it after its purpose has been served. True husbandry would teach that all refuse, whether animal or human, should be replaced rather than be sent to poison our water-courses and then be lost in the sea. Nature destroys nothing, simply changes its consti- tution ; and with all the inorganic matter we are continually bringing to the surface, where it can, through the instru- mentality of vegetable life, be organized, and all the organic matter we are continually bringing from abroad, our soil ought to be growing richer instead of poorer, and in this way be able to minister more largely to our wants. On the whole, therefore, we cannot expect the life- sustaining capabilities of the land to increase. Unless con- tinued adversity should drive us to the use of simpler food, there is little reason to expect that an actually larger amount of nutriment will be raised at home; but rather, every reason for believing that each succeeding year will diminish our power to support increasing numbers upon the food which our own islands are able to give us. Nor are we better able, without resorting to the produce of other countries, to clothe than to feed our people. All the cotton, as well as silk and jute, are of foreign growth, and so is a large proportion of the flax, leather, and wool employed in the manufacture of wearing apparel and house- hold requisites. The following figm-es show the value, on an average of the past twelve years, of the imports of TO THE MOTHER COUNTRY. 279 materials retained for use and manufacture, with the portion of them left after deduction of the estimated value contained in the exported articles, and the corresponding values of the home produce : — [In million £'s to two decimals.] Foreign. Home Produce. - , Home Imrorts. Consumption. Cotton £ 42-23 5-16 2-47 15-18 15-55 £ 9-72 3-02 2-19 12-40 5-06 £ nil. Flax 200 Jute nil Silk nil. Wool 8-50 80-59 32-39 10-50 It thus appears that probably one-fourth only of the materials from which our clothing is manufactured are of home growth. For the erection of buildings and manu- facture of furniture, wo are more than ever compelled to use wood of foreign growth. III. Before passing to the consideration of the sources from which the deficiency in our home supplies is met, we may briefly inquire whether there is any probability of lessened demands upon these supplies in coming years, or whether, in truth, the present rate of increase of consumers is not lower than we have every reason to expect it will bo in the future. Dr. Farr, in his report to the Registrar-General of the mortality in England during the ten years 1801-70, points out that in the healthy districts of England the annual deaths are only 17 to the 1,000 living; and though the number for the whole kingdom raises the average to 22 per 1,000, there is a gradual approximation to the lower rate, any excess over which " is not duo to the mortality incident to human nature, but to foreign causes to be repelled, and by 280 EXTENDED COLONIZATION A NECESSITY hygienic expedients conquered : " the overplus due to the operation of these preventable causes being 115,833 out of 479,450, or very nearly one-fourth. With the rapid spread of sounder views on subjects relating to health and the preservation of life, together with the greater attention now being paid to sanitary arrangements, it is not too much to hope that the diminution by death will be less than it has been ; nor is it altogether Utopian to expect that the re- markable progress of public opinion in favour of temperance will not only liberate from destruction a considerable amount of food, but that the devotion of this food to its proper uses will tend to the conservation of life, and thus to swell the numbers for whom provision has to be made. Furthermore, if the nation is at all to advance in morality and religion its rate of increase in population will assuredly not be thereby lowered. On every ground we may expect that the causes at present in operation, and their probable extension, will lead to the multiplication rather than the diminution of the human species. It is important here to notice that unless some means be found for adding to the number of those to whom agricultural operations furnish employment, whatever increase does take place in the population must all serve to swell the ranks of those who depend upon trading and manufacturing pursuits for their means of subsistence. Of the 31,484,661 enume- rated at the last census, 2,989,154 are classified as agri- cultural,and 6,425, 137 as industrial; these numbers including not only the actual workers, but also their wives, children, or other dependents. In the next census the industrial may probably amount to eight millions, if we include a fair proportion of the commercial class who have to deal with the products of industrial occupations. A growth of popu- lation at the same rate during the succeeding ten years would raise the number to twelve millions, requiring for their employment that every branch of manufacturing industry must be extended at least fifty per cent. The enormous surplus of goods thus created to seek for pur- TO THE MOTHER COUNTRY. 281 chasers, would require our export trade to be doubled or trebled. Such an enlargement is quite within the bounds of possibility ; but would it be so much for the prosperity of the country generally thus to convert it into one huge workshop, with all its attendant overcrowding and other evils at the seat of manufacture, rather than to disperse its inhabitants to found free and happy colonial homes ? IV. The next stage, then, in our investigation must be into the methods by which those for whom our own soil fails to produce the needful food are supplied with this and the other necessaries of life, and how far those or other methods are likely to continue sufficient for the present population, and to keep pace with its future growth. It clearly matters little towards this end in what manner individual labour is employed, so long as its purpose is to procure what is required, and that this aim is realized. A ton of coal or of iron, though useless in itself as food, is of equal value to a hundredweight of wheat or of meat, so long as the one is interchangeable for the other ; but loses all its value when this ceases. In the earlier stages of our commercial history, this country not only produced food enough for all its inhabitants, but had some to spare where- with it could procure the various articles it chose to obtain from abroad ; and up to the period when the food produced or retained at home sufficed for all who had to eat it, it was not their existence, but their comfort, their welfare, or their wealth which depended upon the continuance of tho nation's trade. From the moment when it became neces- sary to make use of foreign food, it also became essential that our foreign trade should bo made, and its extension with the same rapidity as the population increased could alone save us from starvation. Tho following figures, taken from the official tables for the last twelve years, will show that our exports (of all articles) attained their maximum in 1872, and our imports not till 1877, so that between these years wo had a continually increasing balance against us. Since 1878 both have been decreasing, the imports more 282 EXTENDED COLONIZATION A NECESSITY than the exports, thus slightly dt^creasing the balance. Certain corrections, however, have to be made by deductions from the imports, because we do not really pay for them the whole sum at which they are valued on arrival ; and additions to the exports, because we receive for them more than their cost on departure. It is well, therefore, to show side by side the official figures and the revised estimate. There is room for dijfference of opinion as to how far the revision given is correct, and much controversy has arisen on this subject, but substantially there is not much difiFerence of variation amongst those who have given most attention to the calculations. [In millions of £'s sterling.] Official Values. Kevised Estimate. Year. Imports. Exports. Imports. Exports. Excess of Imports. 1867 230 181 205 188 17 '68 247 180 220 187 33 '69 248 190 221 196 25 '70 259 199 231 207 24 '71 271 223 240 230 10 '72 296 256 263 266 — 3 '73 315 255 281 267 14 '74 312 240 278 251 27 '75 316 2-23 281 233 48 '76 319 201 284 209 75 '77 341 199 304 208 96 '78 316 193 281 202 79 '79 306 192 272 201 71 It was contended by the extreme school of political economists that the imports, however much in excess, must really be paid for by the exports, and thei'efore, that their magnitude only shows the profit that accrues from the exchange. But the events of the last few years, and the extreme depression of our trade, must surely show the fallacy of this theory. It is now generally admitted that we have been liquidating the balances against us by the TO THE MOTHER COUNTRY. 283 sale of bonds and other securities accumulated in tlio times of our prosperity ; and the recent rise in the Bank rate is due to the apprehension that America, from whom we are large purchasers, especially of food, whilst she buys little or nothing from us, having re-obtained possession of her bonds, &c., will now demand payment in gold. Others, again, assert that the dividends and earnings accruing to this country from its Colonial and Foreign investments and trade are equivalent to the deficiency. There arc no means of ascertaining even approximately to how much these receipts may amount ; no doubt they are large, but it is more than probable that, as our Colonial investments are continually going on, very much of that which would otherwise be applicable to payment for our purchased imports is really expended on loans and goods invested abroad, and thus they become additions to our capital rather than disposable income. The important bearing which these questions have upon the ability of this country to sustain its people by its foreign trade will be seen in the figures, which show how largely the increase in our imports arises from our purchases of food ; this increase in the later years being really greater than it appears to be, on account of the low prices which have prevailed : — [In millions of £'s sterling.] 1867 101 1871 118 1875 157 1868 105 1872 136 1876 159 1869 106 187.3 147 1877 177 1870 100 1874 143 1878 1(17 It will be specially noted that whereas in 1867 our exports of British produce and manufacture exceeded our imports of food by £80,000,000, last year the excess was but £20,000,000, a sum quite insutticicnt to pay for the raw materials of foreign growth which arc worked up into so large a portion of the manufactured goods wo export. In short, that at the present time the whole products of the labour expended and the capital emi)loyod in British in- 284 EXTENDED COLONIZATION A NECESSITY dustries for exportation, fail to realize enough to pay for the food we import for consumption. Let the figures be examined and their import scrutinized in what way we will, the conclusion is irresistibly forced upon us, that at the present moment England is unable to provide food for her people either from the produce of her own soil, or by the exchange of her manufactures and produce. But it will be answered that these are times of universal depression ; the whole world is suffering as well as we. That we have a great advantage, in that the savings of the past will tide us over the time of ebb, and that a glorious flood of prosperity awaits us in the future. The reply is twofold. Even if it be true that others are suffering as well as we, it is not to the same extent, nor is it so likely to continue with them as with us. It is not to the same extent, for, with few exceptions, the trading and manu- facturing interests in other countries are the minority, with us they are the majority. We are essentially a productive and commercial nation ; we have been the manufacturers for the world, but are every day becoming less exclusively so since others have discovered that they possess the same sources of mineral wealth as we do. They have increased in numbers and grown in wealth ; they have learnt by our experience, profited by our skill, are copying and improving upon our processes, and are determined no longer to be dependent upon us for that which they can produce for themselves. There may be some revival of trade ; let us welcome the gladdening symptoms which are showing themselves at the present moment, but not deceive our- selves by over-estimating their importance or believing that the inflation of 1872-3 is about to return. If the figures which have been produced, and the arguments by which they have been supported, are of any value, they can scarcely fail to establish the fact, that on financial gi'ounds alone there is a necessity for extended emigration. We have hitherto been parting with thousands ; it must now be • by hundreds of thousands, even if not by millions. TO THE MOTHER COUNTRY. 285 V. Weighty reasons also why an extensive emigration is necessary, are to be drawn from the social and moral condition in which large masses of our population are found to exist. The rapid and continuous expansion of our manufacturing concerns, together with the consequent growth of our trade, have caused a continual drain from the country; and the congregation of increasing numbers in the towns, which both on the sea-coasts and in the centres of industry, have been growing with unexampled rapidity. It is in these that the additions to the population mostly take place j and to find employment year by year for those who are swelling the ranks of our artisans and labourers will require not only the maintenance of our present trade and manufactures, but such an enlargement as the most sanguine can scarcely expect to see. The healthy arrange- ment of dwelling-houses, and the adoption of sanitary improvements, become more difficult in proportion to the density of the population congregated within limited areas, and demand an expenditure the burden of which has been unwillingly borne even in times of the greatest prosperity, and in adverse times becomes the occasion of much outcry from the ratepayers. The crowding together of large numbers, and the distance from open spaces and fresh air, have a most injurious effect upon both health and character. Something has been done of late by the widening of streets and the multiplication of breathing-grounds, but these require continued expenditure, and after all scarcely keep pace with the additional necessity. It is only those who make it their business to visit the haunts of the poor, and the homes of even the better class of our labouring popu- lation, who know the wretchedness of overcrowding, in- sufficient ventilation, and deficient means for the removal of refuse ; or understand how these undermine the health and lower the moral standard of those who exist rather than live. To these are to bo attributed most of the addiction to drink and the want of morality that fill our poor-houses and hospitals, our gaols and lunatic asylums. There aro 286 EXTENDED COLONIZATION A NECESSITY festering sores hero which all our costly efforts fail to heal. There are hot-beds of vice, infidelity, and disaffection which may lie dormant whilst work is tolerably plentiful and wages reasonably good ; but may become active under the strain of long-continued depression such as we have lately passed through^ and from the recurrence of which we are by no means safe. We are wisely erecting schools, and giving better training to the young, but education, while it cannot cure these evils, will but render more dangerous to the welfare of society those who, lacking employment and suffering want, have every inducement to discontent and disloyalty. It is painful to think how much time and money, how much philanthropic effort and heartfelt sym- pathy, how much religious zeal and untiring energy, are absolutely wasted in merely palliating the evils they are powerless to overcome. It may be doubted whether any- thing but a general breaking up of associations such as extensive emigration would cause, will prevent the growth, and ultimately the manifestation, of such disorders as are utterly inconsistent with real national prosperity. VI. Such being the condition of our agricultural and manufacturing industries at home, as well as of our trading relations with the rest of the world, let us for a moment consider what would happen supposing that through some extraordinary convulsion of nature there were an upheaval in the Western Ocean of a cluster of islands, or even a whole continent, whose situation should be as contiguous to the shores of Ireland as the Emerald Isle itself is to the Mersey. Let us imagine further, that amongst these islands were to be found some with a tropical climate suited for the production of the sweets and the spices that we get from the East and the West; some with broad acres of pasture capable of supporting and fattening the cattle and sheep our Englishmen cannot well do without ; others with the soil of California or Manitoba, bringing forth luxurious crops of wheat, and the various cereals without which we can scarcely live ; others dotted with magnificent forest TO THE MOTHER COUNTRY. 287 trees, or the humbler plants which, whether for food or medicine, minister so much to our needs, and furnish the raw materials from which we manufocture our clothing and drape our apartments; that in others, beneath the soil, or cropping to the surface, were seen minerals like those which constitute so large a portion of our wealth. Let us again conceive of these new-found lands aa tenanted by flocks and herds, their rivers teeming with life, the air swarming with fowl and game, in fact, with every form of animated nature known to man, but all destitute of human beings, and thus waiting the advent of him for whose use they were all created. And that nothing might be wanting to complete the attractions of these favoured spots, that they had hills and mountains reaching to the very sky, sloping valleys stretching till they meet the sea, rolling rivers and spark- ling fountains, sights and sounds and scents to satisfy all the senses and charm the most fastidious tastes. Would such places remain long unoccupied ? Would not our surplus labourers rush thither to till the soil or gather its fruits, our capitalists find the means of transport, and our ships bring back their products ? Would there not be a speedy exodus from our shores, till all at least who failed to find profitable employment here, had transferred themselves to such enticing spheres for labour and enjoy- ment? Once again, let us suppose that an adjoining continent, possessing every natural advantage, had for its inhabitants multitudes already used to gaining their own food, but satis- fied with scanty clothing and rudo shelter ; yet willing to be taught the arts of husbandry and tillage which would increase their produce, and to exchange these for better clothing and all the articles which natural or artificial want requires to bo supplied vnth. Would not our manufac- turers set their looms and forges at work to meet the de- mands upon their stocks ; our traders hasten to cultivate amicable relations with the several people, our men of money furnishing the moans and sharing the profits of trade ? 288 EXTENDED COLONIZATION A NECESSITY Should wo not, as our American brethren are doing, move on to the Far West ? Wherein, then, lies the difference between the picture which fancy draws, and that which our maps exhibit and our books of geography and travels show us ; for we have, in truth, all these places in our possession or easily attain- able so soon as we need them ? Simply in the distance by which they are separated from us. But surely this is far from being an insuperable obstacle. Australia is now almost as easily reached as Ireland was in the days when first colo- nized ; and the passage scarcely costs more money than it did when vessels first traded thither. If it pays to bring bullocks across the Atlantic only to be slaughtered, it ought not to be unremunerative to transport human beings to places where they may work to repay the outlay. This outlay, too, it must be remembered, would all be spent in furnishing em- ployment to our shipbuilders, clothiers, provision dealers, sailors, and other labourers. The only real loss is that of the time spent in the transit, and devoted to the first settle- ment. Once settled and thriving, those who go out will require supplies of clothing from our manufactories at home, and send in return food, &c., to support those who produce them. One grave objection is often started — that emigration takes from us'the wisest and the strongest, leaving behind the foolish and the feeble. This is a real difiiculty, but if, on the one hand, we have inherited the wealth previously acquired, we must not, on the other, complain of the charges with which it is encumbered. Nor can we escape the evil by suffering those who might grow up wise and strong in homes of freedom and plenty, to become enfeebled and debased from overcrowding and want of food in their present abodes. Besides which, experience proves that those who are successful abroad do not forget the aged and the young whom they have left at home ; they make large remittances for the support of parents, and the bringing out of the brothers and sisters when old enough to come. TO THE MOTHER COUXTIJY. 1^89 Hitherto many have looked forward to returning to spend their last days in the old country, and this will still bo tho case with the most fortunate ; but when colonization be- comes more general it will be a permanent settlement for most, and it is well that it should be. Attachment to the mother country may and will continue, but the centre of attraction to the majority will be the homes and the sur- roundings in the new country. Colonization will necessarily bo of two kinds. The one that which brings into cultivation unoccupied territories : this will absorb the larger number of emigrants. The other that which cultivates intercourse and trade with the uncivi- lized inhabitants in possession of lands which may yield us food; this will provide employment and sustenance for the greater number at home. Both should proceed simulta- neously, and together not only lessen the population which may bo superabundant, but also largely increase the power of the mother country to support successive additions to its numbers. There is a wide contrast between the advantage to bo derived from the sending of emigrants to our own colonies and to foreign countries. Apart from all other considera- tions they are better customers in the one than they are in the other. The following figures, showing tho values of our exports, prove that whilst our trade has been expanding to the former, it has been contracting to the latter. The value of British produce and manufacture exported since 1871 has been to — 290 EXTENDED COLONIZATION A NECESSITY [In milliou £'s to two decimals.] Year. British Possessions. Foreign Countries. Total. Per Cent. British. | Foreign. £ £ £ 1871 51 "2.5 171-82 22307 23- 77- '72 60-56 195-70 256-26 24- 76- '73 66-:3.'3 188-83 255-16 26- 74- '74 72-28 167-28 239-56 30- 70- 75 71-09 152-37 223-46 32- 68- '76 64-86 135-78 200-64 32- 68- '77 69-92 128-97 198-89 35- 65- '78 66-24 126-61 192-85 34- 66- 5-22 -53 1,267-36 1,789-89 29- 1 71- Upon every ground, therefore, efforts should be made to direct the stream to our own possessions, and away from other countries, especially from those adopting hostile tariffs. We may then fairly claim and expect from our own Colonies the utter abandonment of all protective legislation, and the freest admission of our own products for the use of our own people. VII. Thus far we have been treating the matter as one of compulsion, of stern necessity, enforcing upon the mother- country the duty of providing the necessaries of life for the children whom she can no longer feed from her own bosom, and for whom she has increasing difficulty in procu- ring supplies from extraneous sources. It requires no little courage to maintain these views in face of the revival of trade, which is at this time kindling the hopes of all save those who are immediately dependent on agricultural pros- perity ; but the truth still remains that a country, depend- ing so largely for the means of existence upon the proceeds of its foreign trade, cannot look with complacency upon an insufficiency in its exports, or be satisfied with diminishing sale of out-goings, accompanied by more extensive pur- chases of in-comings. At present the additional cost of our food imports is fourfold that of our increased exports, and TO THE MOTHER COUNTRY. 291 the artisan who gets fuller work or ampler wages has to pay far higher for the food he consumes. The recent activity in the trade of the United States is chiefly in its exports, the result of deficient crops on this side the Atlantic, which their abundance of wheat enables them to supply ; and at the same time by their own increased consumption of dairy produce and other articles to raise the prices which we have hitherto paid. Anticipation of continued demands on our part are leading to the extension of their railway system, which brings them as customers to our markets, and hence the orders with which our manufacturers' books are filled. Should this continue it will furnish our people vnth. means for the purchase of food, and thus support our trade ; but it would be a great calamity should attention be diverted from the far more enduring basis of prosperity, which the extension of our Colonies is fitted to afford. The essential difference between our home and foreign or colonial trade must never be put out of sight. The employment of labour in the production of articles which minister to our comfort or enjoyment, and the distribution of wealth which it pro- motes, are results of the highest value ; but so far as sus- tenance is concerned it does nothing to procure the supplies we need. It may be well to turn gold into stocks of iron or chemicals, but unless these are exported they cannot purchase more beef or bread than are raised at home. The necessity of which we have been speaking might be received with alarm, were it not for the truth of the old adage that " necessity is the mother of invention." It is quite consonant vnth the Anglo Saxon character to evolve prosperity from adverse conditions, to thrive best when com- bating trials and overcoming difllculties. Nowhere is this more clearly displayed than in the liistory of our American cousins. Necessity for economy of power has led them to become pre-eminent in the invention of labour-saving machines. Necessity for economy of money to repair the waste of intestine commotions, has led them to find out the value of patient self-denial, and of paying off the debt in- 292 EXTENDED COLONIZATION A NECESSITY curred in tlieir time of trouble. Our necessities will become real blessings if they enable us to find out the true value of our Colonies, and in no respect greater than in teaching ua the extreme importance of maintaining and multiplying human life, as the surest method for the acquisition of wealth. The question is often asked, wherein lies the source of wealth ? The answer frequently given is that it comes from the soil. This is strictly true, though but in a limited sense. Gems and gold, the most precious substances derived from the soil, are only the representatives of real wealth, and this they owe to the trouble of obtaining them, or the scarcity in which they exist. Did the alchemy of nature produce them in profusion they would cease to be deemed wealth. Whatever of real worth is extracted from the soil owes its chief, if not its only, value to the labour which brings it forth. Is labour, then, the source of wealth ? Not altogether, for it may be expended in the destruction as well as creation of wealth ; and wealth is often formed — as in the fruits which the earth spontaneously produces — without its agency. The true source of wealth is to be found in life, and life alone. Without life the earth would be barren and deso- late, as it was in the remotest period to which history reaches, " without form and void.^^ Take the lowest form in which it is manifested, that of vegetable life. By its agency inert matter assumes the various forms and characteristics which make it capable of supporting the higher grades of life and furnish other substances of real wealth. In the next stasre, animal life still further can-ies on the processes of conver- sion, until through the instrumentality of the living power inherent in man, the brain becomes fitted for the exercise of thought and power by the direct gift of the Creator, im- parted when he became a living soul. It is by the exercise of these gifts through which man wields dominion over animate and inanimate nature that the higher forms of wealth are called into existence. In limiting life we lessen the production of wealth ; by its preservation and multipli- TO THE MOTHER COUNTRY. 293 cation, ■we may best increase our store of liches. We think and act thus with our fields and our flocks ; ought it to bo less true with respect to our families ? There must be some- thing radically wrong in our social or political condition when the words of Scripture, " happy is the man who has his quiver full of them," cease to bo true ; and that wrong may be set right if we will only properly use the unbounded means for the support of life which our Colonial Possessions place within our grasp. Two illustrations may serve to establish this proposition. The Registrar-General in his last annual report, after calcu- lating the average earnings of each inhabitant of Great Britain, and likewise the average cost of his maintenance through life, comes to the conclusion that the money value of each is £159, this being the difference between the wages received or money earned, and that necessarily expended for the support of life. In the period which has elapsed since first accurate registration took place, the kingdom has parted with some eight million of its people, which Dr. Farr sets do V? n as a money gift to the world of £ 1 ,400,000,000. Of these, some 2i millions have settled in Colonies, and 5^: mil- lions gone to the United States. Further than this, he considers that even in this country, under proper hygienic regulation, the rate of increase which is now 1*3 per cent, should be 1'8, so that the population, instead of doubling itself in fifty-five years, should do so in every thirty-nine. It is to be regretted that the Colonial records afibrd very meagre information by which to judge of the relative rate at which the population increases from natural causes in the Colonies as contrasted with that at home. For the Austra- lian Colonies the accounts of the last five years do show the numbers of births and deaths from which the increase can bo ascertained, and thus compared with similar results ob- tained for the United Kingdom : — 294 EXTENDED COLONIZATION A NECESSITY [In million £'s to two decimals.] Year. United Kingdom. Australia. Pop. Inc. Per . Cent. Pop. Inc. Per Cent. 1873 32-12 -43 1-33 2-12 -048 2-2G '74 32-43 •42 1-30 2-23 -045 2-02 '75 32-70 •39 1-18 2-33 •039 1-67 '76 33-09 •48 1-44 2-41 -047 1-95 '77 33-45 •49 1-45 2-52 -051 2-02 Total increase in five years U.K. 2,199,013 = 6-85 per cent. „ „ Australia 230,408 = 10-81 „ Average annual rate of increase U. K. 1-34 ,, ,, Australia 1-98 The only available statistics from Canada, though insuffi- cient for arriving at any accurate conclusion, yet help to show that this superior rate of increase is not confined to Australia, but extends to other colonies in a like manner. To view this part of the subject in another aspect. Some calculations regarding the division and employments of the people of this country in 1877, which will be found in the Transactions of the British Association for that year,' show that in the then circumstances of the United Kingdom some 40 per cent, of the actual workers supplied food for the whole population, and some 25 to 30 per cent, more, other necessaries, lea"sang 30 to 35 per cent, free to provide the luxuries of life and to accumulate wealth. The fact seems thus to be established that each individual life is, or ought to be, of actual money value to the State. Were it not so, there could be no growth of substance or wealth. In the earlier days of settling, no doubt the whole time of every worker needs to be occupied in provision for daily wants ; but after a short period there is more to spare for enjoyment or acquisition than is possible in the old country, with all its concentration of power and machinery for econo- mizinir labour. Ante, page 116 ct seq. TO THE MOTHER COUNTRY. 295 VIII. Ono other motive which should induce the mother- country to foster the further colonization of her dependencies remains to be noticed — it is the sense of responsibility arising from the relationship in which she stands towards them. It is not only that her own soil fails to provide sufficient for the wants of her growing population ; that there seems little likelihood of greater or improved cultivation increasing her produce to the necessary extent; that our manufacturing and trading operations, which have hitherto procured supplies from abroad, now fail to keep pace with the growth of those whom they have to support, and our pro- ducing power appears to be overtaking the demands of our customers. These are urgent reasons why we should send forth a large number of our people. It is not only that the conditions of existence which have grown up amongst us, the modes of life fostered alternately by inflated pros- perity and seasons of depression, require the breaking up of many connections, the changing of many habits, the infusion of new life into the several classes of society ; these offer many inducements to place our people in altered circum- stances, and to surround them with new influences. Neither is it solely because by the difi"usion of our people, the fresh start they may make and the development of multiplied life, there is much wealth to be gained. These are encourage- ments to the occupation of new lands and the enlargement of our intercourse with the natives occupying many of our possessions. It is that, above all these, there should be the conviction that we have solemn duties to perform and sacred trusts to execute. If we trace the various means by which England has become lord of the vast territories which already own our Sovereign's sway, and those which it seems we cannot avoid acquiring — at one time by right of discovery, and another by that of conquest ; at others for the purpose of restoring order or preserving peace ; at one period in pur- suance of selfish policy dictated by the greed of gain ; at another from motives of the purest philanthropy and the 296 EXTENDED COLONIZATION A NECESSITY most earnest desire to benefit those whom we have brought under control — we cannot fail to see that it is neither by accident nor for useless ends that we have thus been led to appropriate so vast a portion of the earth^s surface. What- ever our past policy may have been, we cannot ignore our present obligations, nor refuse to admit our responsibilities in the future. Whether for good or evil the burden rests upon us, and we cannot cast it off. The destinies of many nations are in our keeping, and the peopling of many countries at our disposal. If we have been enabled to settle our own freedom on a firm foundation, we have to secure the same liberty and to give the same relief to those who are as yet unable to claim, or unfit to exercise the full privileges of British subjects. If we have drawn to our shores the wealth created in our Colonies or obtained by trade from other nations, we have to employ our capital in fostering commerce and manufactures for their benefit. If we have arrived at so great a knowledge of, and obtained so great a mastery over the powers by which the earth's products may be utilized, we have to impart these gifts to those who are yet in ignorance, and therefore in poverty. If we have joined the ends of the earth together for our own convenience, we have to unite the whole of our possessions together and to ourselves by yet closer links and more en- during ties. If we are in the enjoyment of all the comforts and benefits which a high state of civiKzation confers, we have to train our dependents to secure the same advantages. If the principles and the practices of morality are to prevail, we must introduce them where they are unknown, and fill our lands with those who will aid in their propagation. If we ourselves are blessed with the light of religious truth, we must strive to cast the reflection of that light over the dark places of the earth, and seek to raise up a seed to serve Him by whom it has been bestowed. These are solemn duties we dare not decline; glorious privileges we would not lose. IX. It does not fall within the scope of this paper to TO THE MOTHER COUNTRY. 297 discuss the various methods by which the desired ends may be attained. Its purpose is rather to prove the necessity which exists, and to stimulate all, home-residents and colo- nists alike, to determined efforts to meet that necessity. The times and the circumstances are every way favourable. At home we have the people, and the money wherewith to assist their removal. We have the ships to carry them, and the power to build more if wanted. We have capital seeking for investment, which may be advantageously em- ployed either directly by its owners, or indirectly through the agency of public companies, in making harbours, laying down railways, clearing lands, and building habitations in the colonies with far better hopes of success than in many of the wild schemes in which we are so prone to embark. We have abundance of implements and tools for every de- scription of agricultural, mining, and building operations, the manufacture of which would furnish immediate employment for many of our artisans, and give an impetus to many trades. We have been educating the young, so that they at least need not go out unprepared for entrance into new life. The ranks of every profession are over-filled, so that we have teachers — religious and secular — physicians, engineers, lawyers, clerks, together with farmers, trades- men, mechanics, all in sufficient numbers to direct and caro for the families and individuals who may cross the seas. Facilities exist and may be provided such as never before were to be found in so great a degree ; and really nothing seems to stand in the way but want of knowledge, desire, and will. In the Colonies there is abundance of unoccupied land, every variety of climate, every description of food and of material for clothing. Pioneers have gone forward to pre- pare the paths for those who are to come after them, so that there are few places in which friends and companions are not to be found ; whilst postal and telegraph communications keep up constant and close intercourse ^vith those who may be separated by wide continents or broad seas. In 298 EXTENDED COLONIZATION A NECESSITY many of our possessions, and in other uncivilized parts which are ready for forming attachments with us, there are large bodies who would soon become our customers for merchandise and our growers of food with whom a profit- able trade will in time be developed, if only we send as settlers amongst them those who are prepared to cultivate amicable relations, rather than to extort from them the goods or the labour they have to give ; to carry the gifts of civilization, rather than those of the sword. In former times two classes were disposed to emigrate — those whose spirit of enterprise and desire for wealth led them to brave hardships, in the hope of returning home to spend their later days in ease and plenty ; and those who, having misconducted themselves or otherwise broken down at home, found it desirable to seek new places to live in. Hence Colonial life was rude and rough. Few cared to become steady settlers, or to cultivate the comforts and happiness of home. These may still go out in consider- able numbers, but we also want those who, "svith settled intention and hearty desire, change their country, but carry with them or speedily make permanent homes wherever they may go. The increasing numbers and the rapidity with which these are added to in newer countries forbid the expectation of return. The many must, once for all, trans- fer themselves to the fresh locality, seeking to make it as much like the old one in everything that is good, and as much unlike it in everything that is ill, as they possibly can. The feeling must not be that of expatriation, but that of extending the borders of the fatherland. This, too, should be the spirit to actuate the Home Go- vernment in all its relations with existing or yet to be formed Colonial possessions. All distinctions of laws and customs should be swept away, and the same principles and methods of rule should be adopted, or only withheld for a time in the case of untutored natives. Whatever institu- tions, religious, educational, scientific, or philanthropic, have been found to work well at home, should be founded. TO THE MOTHER COUNTRY. 299 improved, and adapted to the special requirements of each place. Whether it would be possible to form an entire federal union of all parts of the British Empire, so as to have the same fiscal laws and regulations, is too wide a sub- ject to be entered upon on this occasion; but there can be no question that if practicable it should be adopted, and if not altogether feasible, that no unnecessary obstacles should be placed in its way, or any departure from its spirit en- couraged. If it be necessary for revenue purposes, on ac- count of the different positions in which they are placed, to have different rates of duties on the importation of goods, they should undoubtedly differ as little as possible, and every attempt to establish Protection on either side as against the other be utterly repudiated. It is the duty of the mother country to set the example and exercise her authority for the general welfare, but it is also the duty of the children to follow and acquiesce in that which is for the benefit of both. The idea of separate inte- rests or independence of each other is utterly inadmissible. The object on all sides should be to draw tighter the bonds of union, to weld every portion of our Dominions together into one harmonious whole, to make everyone within the bounds of the British Empire feel and act as an inhabitant of the 07ie United Kingdom. I have spoken of the necessity imposed upon the mother country that she should extend and perfect the coloniza- tion of her numerous possessions, but is it not equally a necessity to those possessions that they should be fully colonized ? She has more than an abundance ; they, with few exceptions, a paucity of population. She is unable to raise her own food, they can raise more than they can con- sume. She has a plethora of wealth whicli seeks employ- ment in foreign lands : they have need of more than she can give to develop their untold resources. She has tho knowledge, tho refinement, tho treasures of art and science, accumulated in the course of tho years that ai*o past ; they have yet to obtain these invaluable possessions in the years 300 COLONIZATION A NECESSITY TO THE COUNTRY. that are to come. The necessity is mutual : let both bo gainers by its being met and supplied. These are conside- rations which can no longer be neglected or evaded. They force themselves upon us in our homes and our offices, in solitude and society, in the palace and the hovel ; they will tax* our intellects and should lie near our hearts. When these sentiments prevail, and — presumptuous though it may be in me to say so — not till then, will there be any solid return of national prosperity. Whensoever they are held by the leaders of public opinion, and responded to alike by the voice of those at home and those in our colonies, the work will be viewed as the most important that can occupy public attention, and all together will join in its perform- ance. Then the most important and influential member of the Government will not be the Minister who sits at the Home Office, not the one who presides over War, not even he who rules at the Exchequer, but the honoured individual into whose hands Her Most Gracious Majesty commits the affairs of the Colonial Office. XIV. Drinking and Depression.* THERE is every indication that the winter upon which wo have now entered will bo one of much privation, and it may be of severe suffering to a large portion of the labouring classes. The proposed reduction of wages in the agricultural district of Kent and Sussex, which is resisted there — though, we believe, tacitly accepted in other parts of the kingdom — cannot be without effect upon the comfort of many homes. Even that, however, is better than strikes and locks-out at a season of the year when work is always scanty, though the wants of the workers are increased. Nor are things any better in other quarters. In the coal dis- trict there are accumulations of stocks. Lord Londonderry speaks of having 60,000 tons lying on the banks for want of purchasers. In the Cleveland district, as well as the Scotch and other centres of the iron trades, numbers of fur- naces are blown out, and mills are standing idle. The same tale is told in Lancashire as regards the cotton mills, which are working short time, and the condition of manufacture is very nearly alike in the woollen district of Yorkshire. Every- where there is lessened opportunity for working — conse- quently smaller earnings f(jr the support of the families, and there seems no prospect at present of a favourable change. The demand for tlie products of our manufacturiug industry has fallen off; other nations are producing for themselves, and hence prices have been lowered below those which ' " The Cliurcli of Eiijiliuul Temperance Clironiclc," Novcmbir 30lh, December 7tL and 14tl), 1«78. ;^02 DRINKING AND DEPRESSION. yield profit, and it cannot bo expected that employers will continue to increase their losses by continuing to give wages that raise the cost of the goods beyond that which customers will give. In the agricultural counties the cause is somewhat different, though the result is the same. The abundant supplies which pour in fromall parts of the world so reduce the price as to leave little or no profit to the farmers, and there is no doubt that they are compelled to seek relief in reduction at both ends, the rents they are charged and the wages they pay. However much we may sympa- thize with the poor who suffer, there would appear no possi- bility of avoiding the reduction, nor any immediate hope of the necessity passing away. Now, it is just because we do most deeply feel for those who are thus deprived of their usual amount of earnings, that we would point out to them one effectual means of meeting the evil ; that is, by reducing the consumption of beer and other alcoholic liquors ; or, better still, cutting it off altogether ; for the strongest advocate for the moderate use of these will admit that where retrenchment is neces- sary it may better begin* with drink than meat, with beer than bread. The estimated average value of the intoxi- cants consumed by each individual being 90s., and the average number of each family being five, of which two at the most are bread-winners, and one of these not able to earn more than half a full worker's wages ; it follows that the average charge upon each income must be 90s. multi- plied by 5 divided by 1tZi:£15, fully 6s. for each week of work throughout the year. This is the average for the whole kingdom and for all classes, but we believe that the poor do really consume their full share, for though some families amongst the rich may expend much more, they are not sufficient in number to actually lower the average to a great extent. Besides this, if the large number of abstainers — all of whom are included in the calculation which pro- duces the average — were left out, it would have fewer con- sumers amongst whom to divide the total consumption. If, DRINKIXG AND DEPRESSION. 303 further, it be admitted that the agricultural labourers from their lower wages, and country as opposed to town life, are more abstemious than the mining and factory workers — the self-imposed tax by reason of the amount spent in liquor is yet far more than equivalent to the reduction in wages which the Kent and Sussex labourers are crying out against. Thus the complaint inscribed on one of the banners carried in procession to the Exeter Hall meeting becomes the chief ground of offence : " We grow the hops, but we must not drink the beer.^' Let but the beer be cut off, and the re- duced wages will go as far as those hitherto received in pro- viding solid substance for the labourer and his fsimily. To the operatives in other kinds of employment the same means of compensation for lower earnings lies open. We very much doubt if all the recent reductions in wages amount to nearly the sum which might be saved by the abandonment of excess in the consumption of drink. To one class immediately above the labourers and opera- tives, that of shopkeepers and dealers, the reduction of wages or earnings has scarcely yet arrived, for the wholesale prices of all articles of food — excepting meat and milk — have been much lower than they were, whilst the retail prices have not fallen in proportion. But it cannot be long before diminished power of spending reaches them also ; indeed it has done so already where, as in Wales and Durham, the number of persons in employment has dimi- nished ; and if not so, they have probably, through loss of work, more claimants amongst whom to divide their means or profits. To these, however, the same course, namely, abstinence, wholly or in part, is open, and they have thus the power of mitigating, if not of altogether averting, tlio present or threatened evils. But is it in truth an evil ? The prophet tells us, " When Thy judgments are in the earth, the inhabitants of tlie world will learn righteousness." Wo as a ])eoplo havo "grown and become strong," and in our pride liavo said, " Is not this great Babylon that I havo built by the might of ray power ? " 304 DRINKING AND DErRESSION. May wo not liopo that tho judgments which are even now in the earth will render counsel acceptable to us, so that we may ^' break off our sins by righteousness ?" Amongst the sins which our nation has to break off, that of intemperance holds a prominent position, and where it exists righteous- ness can find no place. We would earnestly press upon our workers and friends tho consideration whether these are not times in which self- denying and vigorous effort in the temperance cause is most imperatively called for, and full of promise. There is already a perceptible decrease in the quantities of wine, beer, and spirits which are taken out for consumption. This may be attributed to two causes — one, we hope, is the spreading influence of sound knowledge and right princi- ples ; the other, the lessened means wherewith to purchase. Whatever is due to the former is an encouragement to go forward in the work we have undertaken ; whatever to the latter renders the continuance of that work easier and more likely to succeed ; for when abstinence is enforced by neces- sity, its benefits may be understood and appreciated, so that the habit, once broken, may not be resumed when pro- sperity returns. 2. We alluded last week to retrenchment in expenditure on alcoholic liquors as an effectual means for mitigating the privations attendant upon the general reduction in wages which agricultural labourers and others have to accept. This diminution of earnings has its origin in the long- continued depression of trade which the country has to sustain; and until its removal there is little prospect of any class of labourers or operatives being able to obtain the wages they have until very recently enjoyed. It would, however, appear that this depression of trade is in some measure the result of, or is at least enhanced by, the undue consumption of alcohol, as was pretty clearly proved by DRINKING AND DEPRESSION. dOo some figures produced by one of the speakers at the recent great temperance meeting in Manchester. The details of this question are too elaborate for quotation or discussion in these columns — some of them will be found in the Appendix to Canon Ellison's evidence before the Lords' Committee — but it may not bo uninteresting to state the general results of this and other investigations. Owing partly to the growth of population, but still more to the increase in the average consumption of food, bever- ages, and tobacco, amongst all classes of society, it has come to pass that Great Britain and Ireland do not produce much more than half the supplies which their inhabitants consume. The remainder has to bo supplied from foreign sources, and must be paid for with the products of the skill and in- dustry of those who in one shape or other labour for the support of themselves and those dependent upon them. There is much difference of opinion among statisticians and political economists as to the causes and effects of the disproportion which late years have manifested in the quantities and values of the goods imported and exported into and from this country. But there is no room for ques- tioning that want of economy in the use of what we have to purchase, and a diminution in the receipts for such articles as we have to sell, cannot add to the nation's wealth or the spending power of its people. That intemperance acts prejudicially in both directions it is not difficult to prove. It is admitted that some six years ago, when trading and manufacturing prosperity was at its height, the goods we sent out of the country fully paid for those we brought into it ; whereas now the value of the one is at least £9^,000,000 a year less than the other. Those who take an interest in these particulars vnW fiud much of information and dis- cussion in the Transactions of the Statistical Societies of London and ^Manchester. The important points fur tem- perance advocates to bear in mind are, as regards the im- ports, that fully £25,000,000 out of the hundn-d is ex- pended on the purchase either of alcoholic liquors them- X 30G DUINKING AND DEPRESSION. selves, of the grain used in the manufacture of beer and spirits in this country, or of that which is needed to com- pensate for the barley, &c, of home growth which is thus consumed. Now, just in proportion as we lessen or extin- guish the payments made for such beverages, or the materials from which they are formed, may we retain in the country for our own use the goods we give in exchange for them, or the money which arises from their sale. The whole of the £25,000,000 or more thus annually parted with is abso- lutely lost to the country. All that we get in return is the life (?), health (?),and strength (?) which its consumption creates, or the poverty (!), sickness (!), and vice (!) which follow upon its being thus used up. This is an altogether different matter from the amounts taken out of the pockets of the consumers in payment for what they drink, on the one hand, and the money which flows into the exchequer as the result of duties levied on these drinks, or the earn- ings of those who manufacture or deal in these articles, on the other. We are here speaking only of that which is actually transported out of the country in payment or exchange for the intoxicants or their materials brought into it. It may doubtless be argued that the traflBc in the goods which this twenty-five millions represents does bring profit to our merchants and shopkeepers ; and their manufacture, wages and profits to some of our labourers and their em- ployers ; but to this it may be answered that the same expenditure for any articles of absolute utility would yield equal or greater profit. The real question is, what do we gain in return for this payment, and how does it act in elevating or depressing the trade of the country ? Those who see in the moderate use of these beverages a real bene- fit to such as partake of them, must admit that their im- moderate use destroys instead of creating. Food, which maintains life, forms the bones and muscles, strengthens the nerves, and fits the brain for action ; creates the power of production, and increases the numbers and wants of the DRINKING AND DErRESSION. 307 consumers. It thus encourages manufiicture and stimulates trade. Drink, which destroys life, enfeebles the constitu- tion, and paralyzes the mind and heart ; lessens the power of production, imposes a dead weight upon those who do produce, diminishes the numbers and the means of spending to those who might be consumers, and so checks manufacture and depresses trade. We had our cycle of prosperous years, and have had the folly to waste much of our substance in the extravagant consumption of alcohol. We have now our period of adverse seasons, shall we learn the wisdom of husbanding our means by retrenching in the expenditure on alcohol ? Or shall we as a nation pursue the path of pro- digality, till trade, manufacture, and commerce recede from our shore to those of nations more temperate, and therefore wiser, than we ? Our hope lies in the spread of temperance principles, and our trust is in the Lord, who is thus own- ing, encouraging, and blessing the servants whom Ho calls to His help against the mighty power of evil which has overspread our land. We must reserve for another number the endeavour to show how the same cause which increases our outlay for imports, diminishes the quantity and value of the exports with which we have to meet this expenditure. 3. If it be true, as we essayed to prove a fortnight since, that there is to be found in a retrenchment in the con- sumption of alcoholic liquors an ample equivalent for any reduction which has taken place in the wages of agricul- tural and other labourers; and if the curtailment of the nation's expenditure on these articles would go tar to rectify the balance against us- in our dealings with the rest of the world, it is not less certain that the same measure would have a most powerful effect in (|uickening our export trade, and thus in finding the means of payment for the food and other necessaries which wo are compelled to procure from 308 DRINKING AND DErRESSION. abroad. This truth may not at first sight be so apparent as the others, nor is it so easy to explain within a limited compass, but a little consideration will demonstrate the fact. A reference to the Kegistrar-GencraFs report upon the last census will show that in the four great industries of our country, the raising of coal, the manufacture of iron, and the spinning and weaving of cotton and wool, and in deal- ing with these productions, there are some million and a half of people employed. On the computation already made the dependents upon these, will raise the number who have to be supported by their earnings to some five millions — amongst whom the consumption of beer, spirits, &c., must entail an expenditure of say £22,500,000 per annum, a sum which the most strenuous advocate for the moderate use of these articles must admit to be some twenty millions more than is needed. If, then, we turn to the records of our foreign trade it will be seen that our exports of coal, iron, cotton and woollen manufactures for last year were valued at £120,000,000, on which a charge of £20,000,000 is equal to 16 per cent. It may of course be argued that the operatives by whom this amount is assumed to be expended on alcohol, produce a larger value of goods than that named for export, inas- much as they manufacture for their own wants as well as for home use by others. But then their own direct con- sumption of alcohol by no means includes the whole charge their earnings have to bear; for the houses they live in have been built and furnished by those who have been like consumers ; the bread and meat they eat, the clothes they wear, the comforts they enjoy, the rates they pay, have all in the same manner been enhanced in cost by the value of the liquor consumed by those engaged in their production. In fact, this expenditure so runs through everything that it is impossible to say where it begins or where it ends. It imposes a tax upon whatever is grown or made, used or en- joyed, and its reduction or extinction would lower the cost of everything, so that a diminution of earnings or profits DRINKING AND DEPRESSION. 309 would really leave the recipient no worse off than at present ; to say nothing of the absolute saving of the outlay on the crime, sickness, and poverty which are the sure attendants on the habitual use of intoxicants. If, then, we are not wrong in charging this £120,000,000 of export with the £20,000,000 of unnecessary expenditure, it is clear that if the prices at which we sell our goods can bo maintained, there miglit be so much more money to be shared between those by whose capital, skill, and labour they are produced ; to be applied to purposes which in them- selves would require more labour, support a larger popula- tion, and employ more persons to supply their wants. If, on the other hand, our foreign customers fall off in their demands for our manufactures, as they have of late been doing, the surest way to bring them back will be by a reduction in price, such as might be done without injury, at least to the extent of the amount saved on alcohol. Dependent as we are upon other countries for the help we find needed for the maintenance of our population, it is a matter of vital importance for us to maintain our present markets, and to extend rather than contract the sale of our manufactures. Whether, therefore, we look to the facility there exists for reducing the cost of home produce and the expenditure in foreign markets, or to the advantages to be derived from lowering the expense of our manufactures for abroad, we see most urgent reasons for the disuse in part, or even wholly, of the present amount of stimulants. "We do not say that tho ])resent depression of trade is to be attributed to this cause alone — far from it — but we do say that it is an im- portant factor in the case, and that its removal is one of tho surest and safest remedies to which recourse may be had. The subject may be somewhat difficult to elucidate or to gain attention for, but the facts on which it rests and the arguments by which it may be supported are not beyond the reach of our intelligent working men and women, nor by the elder boys and girls in our schools. To none of 310 DRINKING AND DErRESSION. these will they be wanting- in interest when fairly brought to their notice. In these and the previous remarks we have been seeking to derive instruction from the statistics of the past, for the surroundings of the present are none the less gloomy. Nor are there many appearances of brightness in the prospects of the future. We fear that there are hard lessons yet to be learnt. It is not alone the vice of drunkenness which has overspread the land, but the insidious habit of relying upon stimulants to sustain forced exertions and continuous labour, which is wasting so much money and sacrificing so much power. It is this which prepares the way and leads on to the more open evil. We rejoice, therefore, in the awakening perception to the truth in this matter, and trust that the financial arguments, though not the highest ground to be taken, may in the present juncture of affairs prove conclusive to many minds. Amidst all the distress and anxiety which is causing '' men's hearts to fail them for fear and for looking after those things which are coming on the earth,'' we are reminded of the prophet's question, " Shall there be evil in the city and the Lord have not done it ? " May not these evil results of intemperance be permitted to the end that we may see more clearly its enormity and hasten to put away the accursed thing from among us ? {^This paper has been inadvertently placed out oj" order ; it should have stood No. X., p. 199.] XV. On the Recent Revival in Trade.' THE latest issued official accounts of the foreign and colonial trade of the United Kingdom, together with those of the several preceding months, bear testimony to a very considerable increase in the quantity and value of both imports and exports. The figures in which these are set forth have been received as evidence that a real revival of trade has set in, and is about to extend beyond the bounds which have been reached in former years. Such an analysis of these figures as may serve to indicate their real bearing on the welfare of the country — both present and future — will not, therefore, bo uninteresting; either to those engaged in trade or manufacture, or to those who aro any way concerned to understand the position in which we stand, or that to which we may look forward. It was during the sitting of the British Association in the manufacturing town of Sheffield last year, that the first gleams of returning prosperity were distinctly seen. There had been for some months previously more frequent ap- j)earances of ''paper" in the London Money Market of American origin, which were taken as indications that there was a stir in American trade ; and many proofs that the depression into which trade on the other side of the Atlantic had fallen was passing away. Not a few hopes were expressed that this country would in like manner ' Read ill Section F uf, the IJritisIi .Vssociution, Swansea, An;,'. 27, 1.S80. 312 ON THE RECENT REVIVAL IN TRADE. emerge from the depth into which its trade had fallen, so soon as prosperity was again brightening the prospects of the United States. The receipt, therefore, of orders for various descriptions of our iron products — and especially for rails — was immediately viewed as a precursor to manu- facturing activity. Nor was the expectation unwarranted by the results. A spirit of confidence at once sprung up, and prices rose so high as to show that in addition to that which had a sound basis, much speculative business was going on. Thus a stimulus was given to production. Higher* prices were asked and given, and for a time there seemed to be no lack of buoyancy in almost every market. Prices again gave way, but are now being par- tially recovered, and the opinion is almost universally enter- tained that a new era of prosperity is being entered upon. Such being the case, it may be worth while to compare a yearns transactions with those of the preceding one. The early date at which the monthly accounts are now issued from the Custom House gives us the means of compiling for such comparison the twelvemonth ended July 31 last with those which came to a conclusion on the last day of July in 1879. We can thus place side by side the figures for the worst year of depression and the first year of re- covery. Before entering into an examination of the details of the last two years, it may be well to state the totals for each year since 1871 — that is, so far back as they were collected, on the same system as now exists ; and to show the diffe- rence in value between the goods imported and those ex- ported, as follows : — - ON THE RECENT REVIVAL IN TRADE. [In million £'s to two decimals.] Year ending Imports. Exports. Excess of Iini)orts. July 31, 1880 4J 404-31 345-78 387-35 38976 37^37 369-48 375-'2 3^6-43 349-85 il 271-24 239-H6 250-59 254-31 2(i(i-81 28S-H7 .'501-23 3-20-72 304-73 i: 13307 105-92 136-76 135-45 10556 80-61 '79 '78 •77 „ '76 „ '7.5 '74 73-89 45-71 4512 „ 73 " '"^ It will thus be seen that of the irajiort.s the twelve months jiast ended were the highest, and those of the pre- ceding twelve the lowest of the whole series. Of the ex- ports, the period ending in 1879 was likewi.se the lowest, but that just ended was by no means the highest ; whilst as rcgard.s the preponderance of imports, the most recent is very nearly the greatest, there having been, until 1880, a progressive decline in the value of the exports. Comparing the years ending in 1880 and 1870 together, they differ in all these particulars more widely from each other than any of the preceding years, the growth in imports having been £58'53,in exports £31-38, and in the excess of the former £27*15. These figures include the whole of the imports — those again sent away, as well as those retained for home consumption ; and of the export.s both the re-exports and the articles of British produce and mauufacture. Separating the one class of exports from the other, it appears that in the latter year they have amounted in value to £2 14,000,000 Uritish, and about £57,000,000 foreign and colonial, as against £187,000,000 of the one and £53,000,000 of the other. These figures are not exact, for the accounts of the foreign goods are only shown iu total at the proper end of each year, but they are accurate enough for the present purpose, and tell the increase of 314 ON THE RECENT llEVIVAL IN TRADE. Britisli to have been 2 "] , and of foreign between 4 and 5 millions of pounds. These foreign and colonial goods show the activity of trade, and add to the national receipts by the commissions and profits on their sale ; but, as regards the employment of labour and capital, are of inferior im- portance to the British. In estimating the worth of this increase, very much depends upon whether it has taken place in the quantities of the goods that have been sold, or in the prices they have realized. From so many of the articles being shown in the accounts in value only, it is not possible to say how this may have been as regards the whole, but by abstracting the principal articles that are stated in both quantity and value, the relation of the one to the other may be ascertained for such portion of the exports, and it is not likely that the proportions of the remainder will vary greatly. Classifying the articles so abstracted, and calculating how far the difference in value is due to greater quantities or altered values, the following results appear. As before, in million pounds to two decimals : — ON THE RECENT REVIVAL IN TRADE. 315 [In million £"s to two decimals.] Value of E.xjHDrts, 1879-80. More or less than 1878-79. Increase or decrease due Vt Quantity. IVice. Coals £ 8oi 3-i6 26T2 £ •96 •24 8^44 £ 1-13 •10 7-63 £ —-17 Copper •14 Iron •81 Mineral 37-29 9-G4 8-86 •78 Cotton Piece Goods 53-42 2'12 5-03 15-95 7^30 •30 •49 119 7-59 •26 •44 1-83 —•29 •04 Ijinen ,, „ •05 A\^oollen ,, „ — -64 Textile 76-52 928 10-I2 —•84 Cotton and otlior yarns Alkali .' 19^02 2-32 1-73 2*92 r6i •01 •38 — 09 — 09 •01 —58 •24 —•09 —■23 —•03 -59 •14 lieer Leather •14 -04 27-60 •22 —69 •91 Total specified 141-41 1914 18-29 •85 Since the full value of all the British manufactures ex- ported for the year ia 214 millions, and tliat of these specified articles is nearly 142, the evidence thus afforded relates to two-thirds of the whole. In like manner with the increase, 27 millions for the whole and 19 for the enumerated. PLxaiiiining these particulars more closely, it will bo seen that the increase of £19*14 is between 15 and IG per cent, on the exports of the previous twelve months, and that of this aiiioimt ,£i8'29, or 051 per cent., is owing to tlie (piaiitities havinj^^been greater, and only £'85, or l-l per cent., has arisen from better prices having been obtained. But whilst these are the proportions of the whole, the rates 316 ON THE RECENT REVIVAL IN TRADE. on the dififerent classes of goods differ very much. Thus in coals and metals the increase has been 35 per cent., on textile manufactures 14 per cent., and in the miscellaneous less than 1 per cent. So in respect to the gain in quantities, the minerals are greater by 92 per cent., and the prices are better by 8 per cent. In textile fabrics the increased quantities should have given 9 per cent, more money than was actually credited, but failed to do so because the prices were less to this extent. On the contrary, in the few mis- cellaneous articles shown above there was a real diminution of quantity, but an increase in price, whereby what would have been a loss of 2 '- per cent, became converted into a gain of something less than 1 per cent. Descending more into detail, iron figures for very nearly one-third of the whole year's gain, viz., £8*44 out of i.2"], and cotton piece goods for £7*30, or one-fourth. Of the gain in iron, one- tenth only is due to price, whilst cotton goods have sold for a trifle less than the previous price. On the other hand, cotton yarn has decreased in quantity but somewhat gained in price, and woollen piece goods, though increasing 13 per cent, in quantity have fallen 4 per cent, in price. Taking the whole of the exports together, these figures establish the fact that the very low prices of manufactured goods which prevailed in the latter part of 1878 and the earlier part of 1879, have continued to rule since that time; and that for very nearly all the addition to the values of that which left our shores before the revival, we have had to give extra quantities, the advantage in point of prices obtained having been inconsiderable. If, therefore, the business of selling has yielded any better return, it must have been because the manufacturer received less ; and if the manufacturer gained at all, it must have been either from the lesser value of money or a reduction in the wages of his labourers. Further, as will be shown in dealing with the imports, in the cost of the raw materials from abroad, from which most of our textile fabrics are woven, there has been, especially in cotton, a decided increase. ON THE RECENT REVIVAL IN TRADE. 317 Turning now to the imports, and separating those re- tained at home from those re-exported, we find a total value of about £347,000,000, as against £293,000,000 in 1879. Abstracting, as with the exports, the chief articles, and classifying them according to their uses, the following figures present themselves : — [In million £'3 to two decimals.] "Value of Imports, 1879-80. More or less than 1878-79. Increase or decrease due to Quantity. ] Price. Meat, live and dead £ 23-72 15-34 64-35 3-68 32-66 8-24 1-95 £ 4-06 1-18 13-96 1-93 -26 1-69 —•58 £ 3-70 I-15 632 1-95 —-68 1-18 —•18 £ -36 Butter and cheese •03 Corn and flour 7-64 Potatoes — -02 CoiFee, tea, and sugar Spirits and wine •94 •51 Tobacco —•40 Food 149-94 2-2-50 1 13-44 9-06 Cotton, raw 37-63 9-31 2-64 1 1-77 10-50 7-21 3-29 Flax, hemp, and jute Silii, raw 2-66 •76 1-79 2-03 -92 2-02 -63 — 16 Wool, sheep's — -23 Textile 61-35 15-71 1 l2-i8 3-53 Iron ore and manufacture... Copper 5-80 4-13 12-38 5-02 1-86 -34 2-03 1-36 1-78 2-28 1-03 •08 •34 W..(,d —-25 Hides and luatiicr •33 Aletals, &c 27-33 5-59 ! 5-09 •50 Total 8pecifie) {c) (d) 19—20 •205692 •7022 •145 £-058 1st —21 •201047 •7223 •145 •058 2nd —22 •196061 •7405 •145 •058 3rd —23 •193070 •7565 •145 -058 4th —24 •188790 •7699 •145 •058 5th —25 •184184 •7803 -144 -058 6th —26 •179723 •7913 •141 -056 7 th —27 •174938 •8061 •141 -056 8th —28 •170191 •8240 •140 •056 9th —29 •165541 •8444 •139 •056 10th —30 •161023 •8668 •140 •056 11th —31 •156734 •8971 •140 -056 12th —32 •152545 •9258 •141 -056 13th —33 •148492 •9522 •142 -057 14th —34 •144536 •9811 •142 •057 15th ^35 •140790 1^0115 •142 •057 16th —36 •137307 1-0339 •143 •057 17th —37 •133962 1^0613 •142 -057 18th —38 •130758 1-0956 •143 -057 19th —39 •127662 1-1327 •145 •058 20th —40 •124611 1-1747 •146 •058 21st —41 •121709 1-2217 •151 •060 22nd —42 •118745 1-2766 -151 -060 23rd Car. forward 3-658111 ! 3-298 £1-318 NATIONAL INSURANCE. Number living. Sickness. 1 Total amount of sick allowances. Year of Fund. Ages. Average ir Per head. Weeks. Total. («) U>) (C) {d) Brht. forward 3-658111 3-298 £1-318 —43 •1 l.-)90G 1 -3395 • I 55 -0o2 24th —44 •n;52ti4 1-4104 -159 -004 25 th —45 •1107'.i7 r48'.»3 -164 -005 20lh —46 •108537 1-5701 •170 -068 27tli — 47 •106541 1-6095 •177 -071 28lh —48 •1()46(»3 1-7093 •185 -074 29 th —49 ■102047 1-8758 -192 -077 oOth -50 •O'.);)074 1-9887 •198 -079 31st —51 •0'.).")S88 2^1082 •202 -080 32nd 5-i •092400 2^2219 -205 -082 33nl - J3 •088996 2-3899 •210 -084 34 ih —54 •085525 25523 •218 -087 35th —55 •082040 ? 2-70 •222 -089 36th —56 •078620 ? 2-86 •226 -090 37 th —57 •075247 ? 3-03 •228 -091 38th —58 •071936 ? 3-21 •230 -092 39th —59 •068095 ? 3-40 •235 •094 40th —60 •065527 ? 3^60 •236 -094 41st —61 •002434 ? 3-81 •240 -096 42nd — G2 •059410 ? 4-03 •240 -096 43rd —63 •056151 ? 4-27 •240 •096 44th —64 •053548 ? 4^51 •241 •096 45 th —65 •050094 ?4 85 -246 •098 46th —66 •047880 ? 5-14 •240 •092 47 th —67 •045096 ? 5^34 -241 •096 48th —68 •042340 ? 5-60 -240 •096 49th —69 •039003 ? 6-09 -239 •096 50th —70 •036884 ? 6^45 -240 •096 51st 5-818154 9-317 £3-719 70 and upwards •035535 @ £76 2s. each. £2-704 In per- petuity. 5^853689 £6^423 In the foregoing table the first and second columns show for each year of age from 19 to 70, the exact number of males then alive ; and assumintif tlio rate of mortality to remain unchanged, the yearly diminution of numbers, and consequently of claimants for sick allowances in each year of the fund's existence will be soon. The third column contains tho estimated average extent of sicknes.s, in decimals of a week or whole weeks. The fourth column brings out tlio number of weeks for tho wholt! existing number, and the fifth tho sum to which Ss. for each week 330 THE FINANCE OF would amount in each year up to 70 ; and for that age the cost of a lifo annuity equivalent to the 4s. of weekly pension. Each line will therefore show the amount for the payment of which the fund would be liable in each successive year, and the total the full amount of liability incurred during its whole duration. Dealing, then, in the first instance, with the £10 per head paid by those who in 1871 had completed their nineteenth but not their twentieth year, the fund would start with a capital sum of £2,056,920, the annual interest on which at 3 per cent, would yield £61,708, wherewith to provide the 8s. per week during the sickness of the next fifty years, and 4s. per week for the remainder of life. In the first year the expected sickness per head being "7022 of a week, would for the whole number amount to 145,000 weeks, absorbing £58,000 ; that is, allowing but a moderate sum for expenses of management, not far short of the whole accruing interest. In the following years the number of claimants would be diminished by death to the numbers shown in the table, but the average of sickness increasing with age would for several years keep pace with this diminution, and thus still leave no room for accumulation. In fact, it would seem that the charge on the fund would be the same at the age of forty as at twenty. From that time forward the increase in sickness would overbalance the decrease by death, and the claims begin to exceed the income; and this with considerable rapidity up to the age of fifty-four, when, including expenses, the payments cannot be taken at less than £90,000 per annum, one-third of which would have to be paid out of the capital, as a smaller proportion had been for the previous years since forty-one or forty-two. From the age of fifty-five upwards it is believed that no trustworthy information as to the extent of sickness is to be obtained, but taking the same progressive increase as before, which must certainly err on the side of being too little, the annual claims would probably stand as in the table at about £96,000 per annum for the years between sixty and seventy. Now these succes- "national insurance." 331 sive inroads upon the capital with which the fund originally started would, with the accruing compound interest at the rates given, have reached to £1,047,000, or rather more than one-half the commencing sum. Then according to the table the number of those living to pass the age of seventy would be 35,635, each of whom would become entitled to an annuity of 4s. per week, or £10 8s. per annum; to pur- chase which, according to the price given for the Post Office Savings' Bank, would require £76 2s. per head, or a total of £2,704,000. To meet this there would be less than one million of money left. A fund, therefore, formed upon these conditions would become bankrupt before ajl the claimants upon it had expired. If we suppose that in each year a fresh batch of payments were made by those arriving at the required age, we have but to multiply each of these by the number of years that have elapsed to ascertain exactly how much would have been contributed at any given year, and to add together the successive claims in the table up to the same period, to know what would then constitute the out- goings. If we take the state of the fund at seventy years we shall find that £2,056,920 x 51 =£104,902,920 will have been paid, of which a large portion, though not the half, will have been sunk to supply the deficiencies in the amount received as interest ; and that the annual claims for sick allowance, and the purchase of pensions would require £6,423,000, or more than double the income the fund would produce, even if it had suffered no diminution in its progress. These figures relate only to England and Wales ; the population of Scotland is about 15 per cent., and that of Ireland some 24 per cent, of the English, and assuming their relative number at the respective ages to be the same, it would need at least £9,000,000 to provide for all. But this is not its full extent, for in these days, when women are so greatly earners of wages, there can bo no reason why they should not be called upon in like manner to contribute. Pauperism prevails far more with them than vnih men, and needs the same provision for sickness and infirmity. 332 TDE FINANCE OF Mr. Blackley, however, in fixing the required contribution from each young man at £10, does not calculate upon its being sufficient to provide for sickness and old age in all, for this he would name £15. The calculation is based upon two suppositions — first that whilst all, rich and poor alike, would bo compelled to pay, a large number would fail to claim either allowance. Again, he expects that the funds would be invested at 4 instead of 3 per cent. Both these expectations need to be carefully examined. There can be no manner of doubt that, although in justice, every individual who had contributed would be entitled to come upon the fund, many would not do so ; but the abstainers would scarcely be so large a number as might be anticipated. The feeling would be pretty general that the allowances having been fairly purchased might be justly taken. No charitable emotions would interfere, since Government would be paymaster; and in a great many cases it would be the trouble of obtaining the grant, not any thought of shame, which would preclude its being asked for. For a few years the stigma of taking a pauper's allow- ance would attach to the dole ; but this would soon wear off, and pride would not be wounded by the assertion of a pur- chased right. But any saving thus obtained — and it would, after all, be a very considerable one — would probably be counterbalanced by the extra numbers who would be found amongst the very class for whose wants the fund was founded to make provision. The tables of sickness on which the calculations have been made are derived from the ex- perience of clubs and friendly societies in actual exis- tence, and all of these require proof of good health on en- trance. No such barrier could be opposed to joining the National Club. The constitutionally weak and the perma- nently disabled would be just the class — so far as they pos- sessed the means — who would be but too ready to join. In multitudes of cases the parent would have to provide the money for the son, and it is not for a moment to be ex- pected that he would omit paying for the disabled ones — nor "national insurance." 333 could tboy with any justice be excluded. Even those who were seriously ill would but be too ready if within their power, to pay a sum wliich it would take but six or nine months' illness to return to them, and the rich man who paid without any reasonable chance of having to accept the benefit, would at once demand that the weak and sickly should be those to partake of it in his stead. Neither is it likely that any Government inspection could so effectually guard against deception as the agency of existing societies does. There is thus no reason to anticipate that the claims would on the whole fall short of the calculated amount. Nor is there any bettor reason to rely upon a permanent gain from a higher rate of interest than 3 per cent. If 4 could bo obtained the difference would be immense, for in the case we have supposed the annual income, instead of being but just enough to meet the sick allowances, would leave a surplus of some £20,000 a year for more than the first twenty years, and of gradually lessening amounts for ten or twelve moi'C — so that the survivors at the ages of seventy would find more than enough to provide their pen- sions. It is, however, far more probable that the fund would fail to obtain investments so high as three, than that they would be found at four or higher. It is quite clear that any national club or fund must be guaranteed by Government, and therefore that no securities should be taken but such as are absolutely certain. Pnvate persons or bodies, and public also may, without undue risk, make loans on various descriptions of property and receive higher rates ; but the very fact that these rates are given when Government can obtain loans at very little more than three, is an evidence that the security is not so perfect ; for whenever any invest- ments approaching to the secui-ity of those of the Govern- ment are offered — such, for instance, as that of the Public Works Board — the money is obtainable at 3| or little more. When so largo a lender as the National Club would be, came into the market, it would hclj) to keep down the inte- rest obtainable. In fact it would be impracticable for Go- 334 THE FINANCE OF vcmracnt to bo largoly borrowing and lending at different rates, and in practice it would como to this, that no higher interest could be obtained than Consols or the other Go- vernment Stocks would yield. The result would be as it is with the Savings^ Banks — the insurance funds would go towards absorbing the National Debt — thus helping to keep the interest down, and ultimately enabling the Chancellor of the Exchequer to force upon the nation^s creditors the ac- ceptance of even lower interest than 3 per cent. The calculations in the foregoing table are not put for- ward with any pretensions to the close accuracy that would govern actuarial figures, for which indeed there is not yet sufficient data to base them upon, and the estimate of sick- ness from the age of fifty-five upwards, rests upon an assumption that the progressive increase would be in the same ratio in the later years as the previous ones, which is probably below the truth rather than above it. It is convenient also in considering the progress of the fund, to capitalize the payments after seventy, at the rate for which the requisite annuities may be purchased through the Post Office Savings' Bank, rather than to carry on the calculation to the extreme limit of life. We thus, in the fifty-first year of its duration, arrive at that stage in the history of the fund when all who first became contributors to it, will have passed off, and there will be a regular sequence of new members coming on and old ones passing away ; and were the number of the population to remain stationary, it would stand thus: — Provision against sickness would be made for 5,818,154, being the whole of the male population of England and .Wales who had completed their nineteenth year and not passed beyond their seventieth ; the estimated incapacity in each year being 9" 3 millions of weeks, for which the allow- ance of 8^. per week would constitute a yearly amount of £3'72 millions: to this must be added £2*71 for the pur- chase of annuities of 4s. per week for those exceeding seventy years, together requiring that the fund should "national insurance." 335 have an income of £6*43 millions of money. Towards this the payment of new contributors would produce £2'0G, and for the remainder reliance must be placed on the inte- rest from the accumulations of previous years. This, how- ever, would only meet the wants of the English and Welsh male population, numbering 11 '09 million persons. That of Scotland, being 1'58, and of Ireland 2*G4, a provision for these at the same rates would require £2"45 annually, of which the contributors coming into the fund would supply £"78. If then to these we add fifty per cent, for the females, who being engaged in occupations and earning wages, cannot on any principle of right be treated otherwise than the males ; we shall have a total annual charge amounting to £13'32 millions of money, and a receipt from the young persons under compulsion to pay, of £4'2G, leaving some nine millions to be provided from the investment of pre- vious accumulations. That is, supposing compulsion to have been applied to all the young men and one-half the young women of the United Kingdom, and thus all so pay- ing to have acquired a right to relief in sickness and old age to the extent proposed — nothing short of an accumu- lated fund of £300,000,000, if interest be reckoned at 3 per cent., would be a sufficient security for the due payment of these allowances. If the money could be invested at 4 per cent., 225 millions would suffice; but should only 2 J, per cent, be obtainable, 360 millions would be requisite. We thus see somewhat of the gigantic proportions of the ques- tion with which we liave to deal. An accumulated fund of from two to four hundred millions, created and maintained by an enforced levy on the wages earned by the youths between seventeen and twenty-one years of age, to the ex- tent of five if not six or seven millions annually, and furnishing the means for dispensing weekly allowances in the aggregate amounting to thirteen millions in each year. In this estimate it is assumed that the population would remain stationary in numbers, whereas it is evidently in- creasing ; if it continued to grow as at present, at the end 336 THE FINANCE OF of fifty years it would be doubled or trebled, and the £13,000,000 would be at least £30,000,000, or more. It is obvious that such a fund could only be administered by the Government of the country, not solely because of its magnitude, but also from the impossibility of granting com- pulsory contributions without State guarantee ; or the pay- ment of allowances being thus secured, excepting under State control. The responsibility of conducting all the operations of receipt, investment, and payment, whether through the Post Office, the Local Government Board, the National Debt Commissioners, or a special department to be formed for the purpose, would exceed that of any existing Depart- ment, aad necessarily involve a large expenditure ; for though it might not be difficult to arrange for collecting the receipts, the organization for distributing the grants would be far more intricate than the present Poor Law arrangements. It is true that in the first commencement a limited number of transactions would have to take place, and that they would only grow by slow degrees, thus affording time to perfect plans and develope the requisite machinery; but the extent to which that growth would ulti- mately reach must not be lost sight of in considering the practicability of the scheme, or determining the course to be taken in the institution of its working. A real difficulty arises at the very commencement in providing such an instrumentality as may be capable of gradual but certain expansion through the years to elapse before its arrival at full maturity. But a much graver difficulty will be found in providing any investment for the monies received other than in the Public Stocks (Consols or 3 per Cents), and this is one on the overcoming of which, it depends how much must be con- tributed by each insurer. Mr. BLackley supposes that 4 per cent, will be easily procured, and on this supposition bases his estimate that £10 per head will be sufficient, or even more than enough. If this be so, and the total allow- ances should be as the previous calculations show, there is "national insurance." 337 no doubt that this opinion is correct, but if only 3 per cent, bo obtained, £15 or even more, would certainly be required. Private insurance offices may often be enabled to place their monies at 4 per cent., and public bodies borrowing for buildings or drainage works, have frequently to give as much, but not for very large sums. The Board of Works is able to borrow at S^ per cent., and most of the money so borrowed is invested by insurance and other offices. It will not therefore be safe to calculate or expect that the National Insurance funds could bo put out so as to yield more than 3 per cent., and the result would be that as ■wnth the savings' bank monies, they would have to bo absorbed in the reduction of the National Debt, and thus yield only a trifle beyond the lower rate of interest. Nor is it likely that even this would be maintained : there aro already symptoms that the holders of Consols will ere long have to accept, it may be as little as 2^ per cent., and the diminution of this stock offering for actual sale in tho market, would tend to raise the price, and thus facilitate the conversion of tho 3 per Cents, into a lower paying stock. Were the saving thus effected applied from time to time, in addition to that shortly to arise from the falling in of terminable annuities, together with tho provision already made for a sinking fund, a perceptible decrease in tho National Debt would be going on. Thus by the time that National Insurance came fully into play, or even long before the term of fifty years was completed, it might happen that the whole of the National Debt would come to be hold on this account. Already trustees, both public and private, experience tho greatest difficulty in finding safe securities that will yield more than Consols. It is this which helps to drive the price for purchase up so high, and with so much more money to be thus invested, this upward move- ment Avill be greatly accelerated. It is the absence of higher paying securities on which implicit reliance can be placed, that leads to the introduction of so many unstable projects and causes so much loss to unwary investors. A curious 338 THE FINANCE OF state of things would result should successive decreases of the National Debt, and successive increases of the National Insurance Fund bring the two to the same level. The State would then be debtor in one capacity and creditor in another, and the simple course would be to abolish the fiction of both separate funds, and transfer the charges on the Insurance Fund, present and prospective, to the same category as that for the interest of the National Debt, namely, the general revenue of the country provided for by taxation in one shape or another. We should thus be establishing another kind of poor relief of far larger extent than that at present aflForded, inasmuch as the proposed allowances would exceed the grants at present given ; and the recipients would not as now be paupers, but actual creditors of the State, having purchased by specific pay- ments in early life, specific grants for sickness and old Two fallacies appear to underlie the calculations, or it may rather be said the expectations upon which the scheme of National Insurance is based. First, an undue reliance upon the power for accumulation of compound interest. This is only true as regards that portion of the contributions to the fund which go to provide for old ag-e ; but as the figures in the table show, the claims on account of sickness will at once commence to accrue, and probably swallow up the whole of the interest intended to be re-invested. The fund thus would not grow with anything like the rapidity anticipated, unless the primary contributions were fixed at a higher rate. Secondly, it is forgotten that money has no power of increase apart from judicious employment in con- junction with labour, either that which is put forth in agricultural or manufacturing occupations, or saved, as when public works, such as docks, bridges, &c., render it advantageous to those by whom these are used to pay some portion of their earnings as an equivalent for the labour they would otherwise have to bestow. Such opportunities are limited in number and extent, and therefore there is a "national insurance." 339 limited field for the appropriation of the funds proposed to bo raised. A question far too wido and deep to be treated within the limits of this paper is here opened up — namely, tho expediency of thus divorcing capital from tho labour which alone can cause it to fructify, and the encouragement of those who possess money in trusting its employment to others, and spending their own lives in expending tho in- terest they receive for its use. The policy of tying up so much money in settlements, loans, and employments unconnected with its owners, is clearly not one of unmixed good, and it may fairly be debated whether in this country we have not already gone too far in this direction. The nation is divided into two classes of debtors and creditors, producers and non-producers, to a degree which may perhaps very soon prove to be fatal to its continued prosperity. But this theme must not now be farther pursued, although there is in it enough of importance to awake anxious thought and prompt to careful inquiry. Again, taking into consideration tho magnitude and duration of the engagements into which it is proposed to enter, it is scarcely consistent with sound economical prin- ciples to make contracts of this nature to bind our succes- sors in future and distant years. Whenever money is now lent by the State, or borrowed under its sanction, for tho promotion of public works, it is usually arranged that tho loan shall expire by tho repayment of both principal and interest within thirty years. The National Club, were it established to-day, would become bound for twice that period, by receiving money now, the whole of which would not be repaid till every life now under nineteen had ex- pired ; and its solvency would depend upcm the saiiio rates of interest and other conditions existing unchanged throuirhout the whole intervening time. It is true that this is already done wlienever a Government deferred annuity is sold; but such transactions are so limited in number and amount, as to render it impossible for serious inconvenience 310 THE FINANCE OF to ariso, whereas those would within twenty years embrace two-thirds of our population. Nor are the circumstances analogous to those which occur when new Stocks, Consols, or Tliree per Cents, are issued. Then what in effect takes place is the creation of a rent-charge upon the freehold and other property of the kingdom, to the extent of £3 per annum for every £100 of stock. It is called a perpetual annuity, but can at any moment be cancelled by the pay- ment of the principal ; whereas in national insurance no power can be given to terminate the contract save by the decease of the individual contributor. The object in view is to prevent his becoming a pauper, and while life lasts, the State, which has taken payment, must be bound to pro- vide for his incapacity from sickness or old age. Yet even then there is no security that the object sought will with certainty be attained ; for who shall say whether half or three-quarters of a century hence, the specified sums of 8s. and 4s. a week will meet the necessities of the case ? AVith the rapid changes going on in the value of money and in our social condition, these sums may be wholly insufficient or vastly too much. Money is now abundant at three per cent., it may then be scarce at double or treble that amount, or not be loanable at a half or third of that rate. On all these and many other grounds which might be specified, the financial aspect of the scheme is scarcely such as to commend it to the sober sense of statesmen. Thus far we have been considering the matter as affect- ing the interests and the prospects of the State ; let us see whether its features are more attractive to the individuals whom it is proposed to subject to compulsion. Every such scheme must necessarily have two sides — the one joossessed of advantages, the other the reverse. In this one all the disadvantages would appear to fall on the thrifty, and its chief value to be to the thriftless. This is assumed at the very outset : it su])poses that the contributors are disinclined to save, for if the disposition existed — always supposing that the benefits to bo received are not more than the enforced "national insurance." 341 contribution will fairly purchase — the man who can and will restrict hia expenditure, has other openings for the invest- ment of his savings. A policy of insurance or a deferred annuity he can already purchase through the Post Office on as fovourable terms as the fund could safely grant him, whilst for sickness the £10 or £15 which it is proposed to take from him, would, if deposited in the Savings' Bank, serve as a fund on which to draw during incapacity to earn wages ; which in the case of the healthy and the prudent, who, because they are so, suffer less than the average amount of illness, would rarely be exhausted before by restoration to health the power to replenish it was regained. Besides this, there are sound and well conducted sick funds springing into existence — there is no reason why there should not be more — whose terms are better suited to his circumstances than those of the National Club, adapted as they must bo for the imprudent and the fraudulent, could possibly be. One great disadvantage amongst the many that might be mentioned, would be that the man who wished to emigrate could not carry mth him to his adopted country the rights and privileges of the fund, secured to him whilst remaining at homo. With our ever-increasing population and declining or stationaiy production, it must be the lot of many to seek employment abroad : numbers of our young people aro saving up their earnings with this in view, and it would be cruel to drag from them the product of their self-denial and industry to preserve them from becoming paupers in a land they never intend to inhabit permanently. Again, to the man (or woman) who is striving to improve his position, it is all important that his earnings should not 1)0 taken from him. The true incentive to thrift is tlio power which money gives to render labour valuable. Tools with which to work ; materials for manufacture, goods for sale, houses to live in, or land to cultivate, nay, even appli- ances tor health and coTufort, or means for the accpiisition of knowledge, are all of infinitely more pecuniary value to the wise and the prudent than the paltry 21 or ;J per cent,, z 2 342 THE FINANCE OF whicla is all that the borrowing State can afford to give him. It cannot be too strongly impressed upon our youth of both sexes and of all classes, that in the use of capital, in conjunction with physical or mental power rightly em- ployed, lies the secret of success in life, of that advance- ment which should be to all a lawful and laudable object of desire. Once more, the proposed compulsory investment would fall with peculiar hardship on students, apprentices, tor hose who are working without earning, in prospect of future returns for their labour. How many parents are there, petty tradesmen or small mechanics, to say nothing of clergymen, professional men, government servants, clerks, and others of small means and large families, whose sons, and daughters too, need every penny that can be saved for their maintenance and education or training, to whom the abstraction of the £30, £50, or £100 would prove abso- lutely destructive. From how many homes like these would the wail of despair, if not curses loud and deep, arise, let those say who witness the hard struggles of suffering poverty. But the chief weakness of the scheme lies in the fact that the reckless and improvident will participate in its advan- tages to the detriment of the industrious and careful. So far as it will operate in restraint of extravagant expenditure, enforce the laying by of something for the future, absorb the earnings which otherwise might be spent in folly and dissipation, and thus compel to the exercise of self-denial during the earlier years of life, its value would be great ; but in the removal of incentive to exertion afterwards, and the security it would afford of subsistence during illness, although the result of misconduct, its effect must be pre- judicial. To the dissolute, the amount of sick allowance would often be an inducement to magnify ailments and feign incapacity for labour, whilst to the right-minded it would be so small as to induce every effort to avoid the sacrifice of earnings by declaring on the fund. "Whatever sum may be fixed upon as the contribution to be exacted. "national insurance." 343 it must he that which experience shows to be sufficient to provide the sick and aged allowances. The reckless class would by their claims upon it, both increase the average and absorb the greater share — thus compelling the honest ones to contribute more than would cover their own average, whilst they would actually receive less. It is no answer to this to say that the present effect of our Poor Law is to support or give relief to the undeserving out of funds pro- vided by the deserving. So long as the administration of relief, whether in or out of doors, is vigilantly watched, and granted only as a matter of necessity, much may bo done to check idleness and fraud ; when the allowance can be claimed as a right, no amount of care in dispensing it will altogether prevent a considerable amount of malingering, or prevent its bestowal on those whose only title to claim it arises out of their own improvidence. This danger or difficulty is inseparable from the condition of a payment once for all, whereas the periodical subscription to a friendly society or sick club, brings the conduct of the members under review, and those who are unworthy of its benefits are constantly losing their rights by inability or unwillingness to keep up their payments. Yet it is doubt- ful whether, on the whole, oven the unworthy class would really be benefited by such a fund. The ease with which they could shuffle through seasons of incapacity would have a demoralizing influence, probabl}' leading to such further loss of time and health as to more than counterbalance the value of their actual receipts, and this, in addition to the moral evil produced, would in fact be fiuiincially injurious. It is with no desire to find fault with a plan suggestive of so much good, that this criticism has been undertaken. The evils it proposes to remove are so deep-seated, and so detrimental to our national prosperity, that any mode of satisfactorily dealing -svith them would be liailed -w-ith joy by philanthropists and statesmen of every class or jiarty. Neither is there any reason to regret that it has received so large a share of public attention, for it may stimulate many ,'>44 THE FINANCE OF " NATIONAL INSURANCE." to voluutary efforts for tbcir own provision, to learn the channels through which they may be made, and the value of early economy for the purpose of judicious investment. It may encourage a spirit of self-reliance, and go far to determine the course of life of many by showing them the money-value of small savings, -and the ease with which those who have the will may likewise find the way to secure them- selves against the worst trials of incapacity for labour when sick, or entire dependence upon others in old age. The author of the plan has done good service by evoking dis- cussion, and is to be applauded for his earnest efforts to carry it into practice, although he may have failed to demonstrate its financial soundness, or that it is otherwise capable of being adopted. Yet if the figures now produced are correct and the reasoning based upon them be sound, it will be a national evil to waste further time or exhaust further philanthropic effort in endeavouring to procure legislative sanction for a measure which, when treated in all its bear- ings, and traced through all its probable results, must be financially unsatisfactory alike for the thoughtless, the thrifty, and the State. P.S. Should the scheme be made to embrace all of both sexes, as was assumed in a discussion at the Church Congress held at Leicester since the foregoing was in type, the annual charge on the fund would be more than proportionately in- creased on account of the superior numbers and greater tenacity of life in females at the later ages. This raises the value of the annuities to be provided for at 70 by at least 30 per cent. The difficult question would also arise as to provision for incapacity to work during the sickness inci- dent to maternity, so that altogether the charge could not be estimated at less than £20,000,000 instead of £13,000,000 per annum. I N L) E X Accounts, official, alteration of system, 22 ; oxpeiiitt'd, 25, 29. Aj^riiultiiral condition at home, 286. Animal food, (niantities imported, 85. Alcolidjic liijuids, increase in impor- tation, 41. Alcoholic rates on beer, 134 ; wine, 135. Articles of export, 30 ; import, 36, 37. Articles, principal, values of, 41. Balance of trade, 55, 142; how to be discharj^cd, 144 ; to be provided for, 144, 175. Beer, alcoholic duty on, 134. Beverages, articles used for, 88. Bill of Entry, 26. Bi-motallic tlieories, 227. Blackley, Kev. W. (i., scheme for in- surance, 32C ; to be commended for advoiacy, 344. Board of Trade prescribes nature of returns, 28. ]5ritish jmiducc exported, 43. Bullion, imports and exports of, 05 ; iniluression of trade, lo8, 222 ; re- medies for, 158. Difference of import ande.xport valuo, 50. Drink, cost of to nation, 101 ; imports consumed in, 306. Drinking conne<-ted with depressi'in, 301 ; destruction of food imjorts caused by, 306. Duties on Wine, 133. Economy forced upon us, 94. E.\cess of imjMirts puzzling. l.SS. '' E<-onomist,'' index numbers, 210; rise and fall in prices, 20S ; tables, imports and exp<.irts, 214. Eggs and I'otatoes imfKirted, 87. Emigration, extensive, necessary, 285, 290, 299. Emigrants, classes disposed to become, 288, 298. 346 INDEX. Entries, importers', 8 ; do. percentage of error, 25 ; imports, 25. Evils, growing, how to be checked, 101. Examiner's Office, 6 ; fusion with In- spector-General, 25. Exports, accounts of, 18, 40, 43 ; ba- lance in favour of, 144; British manu- factures, 2 ; comparison of prices, 242; diminution, 223, 261 ; excess of, over imports, 322 ; probability of increase, 149 ; goods from United Kingdom, 1854-74, 53; proportion of, to British and Foreign places, 41; relation of to imports, 1G2; quantities of, 18 ; total value of, 39 ; prices of, not enhanced, 322 ; trade, importance of, 258 ; cost of, in- creased by drinking, 307 ; increase for new year to July 30, 1881, 317 ; low price of previous years, 322. Expansion of fond purchases, 46. Expenditure diminished, 264. Extent of foreign supplies of food, 103. Extravagance of present age, 158. Eall in prices imminent, 208. Farr, Dr., on value of life, 280. Finance of National Insurance, 326. Financial relations to rest of world, 96. Food, comparison of home with foreign, 89, 111 ; animal, 85 ; foreign supply and home compared, 89, HI; eco- nomy of, 265 ; foreign sources' of supply, 109; gi-owing expenditure for, increasing, 73 ; home produce not sufficient, 268, 274 ; imports of, 41, 46, 223; dependent largely upon extraneous sources, 94 ; home produce, imports, 46 ; insuf- cient, 209 ; possibility of increasing, 46, 276 ; reduced to wheat standard, 93 ; different kinds from different countries, 109; economy of, 291 ; nature and extent of foreign, 103; power of sustaining life, 269 ; methods of supplying deficiency, 276, 279, 281 ; values of food im- ports, 79; sources of supply, 105; recent fluctuations in prices, 205 ; waste of, 275. Foreign trade, progress of, 31. France, trade of, 178. Freight and charges estimated, 63. Funds of proposed National Club, 328. Giffen, Mr., accumulation of capital, 205 ; fall in prices, 208 ; production of gold and silver, 208 ; proportion of gold to silver, 205 ; quantity and value of goods, 235 ; value of food imports, 272 ; value of pound, 234. Gold, accession to stock, 222 ; appre- ciation of, 247 ; connection of with silver, 200 ; existing quantity, 203, 206 ; production of, 202 ; produc- tion of, relation to state of trade, 202 ; purchasing power of, 201, 212; stock of in the world, 202; sufficiency of supply, 206, 222 ; va- riations in value, 201, 215, 217. Goods, descriptions of, 12 ; in transit to other countries, 10-11 ; difficulty in ascertaining re-exported, 45 ; imports and exports, 1854-74,53, 57 ; exportation of, 54 ; quantities of, 13; values of, 15-16. Grain converted into beer and spirits, 81, 275, 306. Growth of pojjulation, 115. Hay, Su* Hector, estimates of precious metals, 202, 216. Harvest, deficient, cause of better im- port trade, 324. Hendrik's proposal for gold rupee, 230. Imports and exports, 31. alterations in relative values, 61, 63, 64. countries of origin, 9. exceed exports in in(!reasing ratio, 322. excess of in twenty years, 66, 139, 313, 317. corrections of excess in, 65. of food, 42, 77. textile materials, 317. increase of recently, 317. official sources of information. 7. preponderance of, in rec-ent years, 69. probability of diminishing, 153. quantities of, 18, 45. do. inci'eased by drinking, 302. from different countries, 32. total value of, 38, 79, 84. • true relations to exports, 162. when excess of satisfactory, 167. Income accruing abroad, 144 ; tax as test of income, 150. Increasing dependence for food, 76. INDEX. 347 Indebtedness of other countries to United Kingdom, 67. Index nniiibers of prites, 208, 210, 211,212. Index numbers of prices in country of production, 211. India, priios of goods in, not risen, 224. suffers from depreciated silver, 22"). ■ imports and exports, 22G. Inflation of 1871-73 notabiut to re- turn, .'^25. Inspector-General of Imports and Ex- ports, 6. Interest, rate of, .333. Investments, amount of, 67. Iron, price of affect e; finan- cial asiK'ct iii't conunended, .■}44 ; funds, investment of, .340; must bo numiiged i)y Uovernment, .3.36 ; not advantageous for thrifty, 340; weakness of scheme, 342. Newmarch on produition of gold, SiC, 202. Official trade and navigation statis- tics, 1. Pension after .seventy, cost of, 331 . .344. Playfair, Dr. Lyon, estimate of food, 92. Population of United Kingdom classi- fied, 116; employed in agriculture, &c., 121, 122; evils of over, not to be lessened by restraint, 127 ; growth of, 115; numbers of in 1871, 115, 267 ; sufticient subsistence for, 123, 131 ; source of strength, 131 ; sup- ported on home and foreign food, 155. Potatoes imported, 87. I'ound, sterling value of, 201, 234. Precious metals, consumption in tho arts, 202 ; production of in relation to trade, 202. Preponderance of imports over ex- ports, 55, 69. Prices, ri.se and fall of, 202 ; correc- tions in, 243 ; index numbers of, 208, 210, 211, 212. Production, curtailment of, 192; and (juantity of precious metals, 202. Productive labour overweighted, 194 ; use of, 198. Productive power source of wealth, 292. Progress of foreign trade for twenty years, 31. Pro.sperity led to wast*^-, 275. Protection, return to, undesirable, 157, 190. Publications, official, sUtistical de- partment responsible for, 21. Quantities of imports, 17 ; exports, 18. Hathbone, Mr., letter to " Economist," 138, 147. ]?aw materials, 42, 48. KeciprtK'ity desired by some, 157, 189, 248. Records and Publications, 20. Kelat ion of imports to ex|>orts, 58, 162. Hctrenchment necessary, 30.3. Revival of trade, recent, 307 ; owing to bad harvest, .324. HuHsia, trade of, 177. 348 INDEX. Seyd, E., estimate of stocks of gold j and silver, 203, 218; estimates of indebtedness of United Kingdom, 67 ; proposition for Indian coinage, 2;J0. Sick allowance, cost of, 331. yitkness, average duration of, 330; extent of provision for, 334. Sil\er-(|uestion, phases of, 199 ; reca- pitulation, 232 ; connection of with gold, 200; demonetization of, 221, 224 ; depreciation of, 217, 232 ; de- preciation of insufficiently accounted for, 221 ; existing supply needed, 233; gold-value of, 217; prices of, 200, 218; production of, 202, 217, 220 ; sale of German, 221 ; stan- dard, wisdom of, 231. Smith, Col. F., coinage of standard rupees, 230. Social aspect of trade depression, 250. revolution impending, 260, 265. Soil, failure of, to produce food, 280. Specifications for goods exported, 19. Spirits, alcoholic, duty on, 135. Statistical department of Customs, 6, 28 ; fusion with Examiner's, 25, 29 ; responsible for records, 2, 33. Statistics, official, mode of collecting, 5 ; system of collection altei-ed, 22 ; classified imports and exports, 71. Sugar, &c., converted into spirits, 81. Tables, coiTection of, for excess im- ports, 65 ; countries from which food obtained, 107; etsimated pro- duction of silver, 218 ; exports to diftei-ent countries, 204 ; exports, value in quantity and price, 241 ; food in wheat equivalents, 273 ; food imports, 1857-1879, 65, 272 ; gold- prices of articles, 214; grain con- verted into beer and spirits, 81 ; home-raised wheat and meat, 91 ; home and foreign produce, 270, 271 ; imports classified, 71 ; imports for beverage, 88 ; imports and ex- ports, 1699-1815, 170; 1816-53,57; 1816-79, 174; 1854-74, 53, 54; 1854-79, 60 ; 1877-79, 215 ; imports and exports, France, 177 ; Russia, 178; United States, 180; imports, in excess, 65 ; home and foreign produce, 270, 271 ; live stock, 1867- 73, 46 ; pr'ncipal articles of food, 84-271 ; moving gold bullion and merchandise, 204, 206 ; im[)ortcial aspect of, 250 ; earlier periods of, 1816-53, 55, 163, 1854-79, 61 ; and navigation statistics, official, 1; origin of, 252 ; progress of foreign, 31 ; prosperity of.greatest elevation, 255 ; recent revival in, 311 ; owing to bad harvests, 324. Transhipments, value of, 37. Union, Federal, of British Empire, 299. United States, paying off her debts, 185; supplies of food from, 109; recent activity in trade, 311 ; trade of, 180 ; with United Kingdom, 182. Value, mode of giving imports and ejJports, 143 ; agricultural produce, 90; alcoholic beverages, 100; pound sterling, 201 ; total of foreign food, 112. Values of goods, declared substituted for computed, 25 ; alterations in, 61, 282; official, 17, 33; official and real contrasted, 33 ; principal ar- ticles, 41 ; real, 33 ; revised esti- mate, 282. Variations in prices, 47. Vegetable productions imported, 84. TVatson, Dr. Forbes, iron material worked up, 103. Wealth, general diffusion of, 257. Wheat and meat, increase in, 91 ; home compared with foreign, 91. Wine, duties on, 133. N'.RK SlKKiT, t'CiVliNI CiAKDhW,, ■iliguit, 1876, CLASSIFIED CATALOGUE SEXiECTElD V7 Oleics I'L'IlLlbllKD liY GEORGE BELL AxND SONS CONTENTS : Travel and Arcli;eology . i Biography- Histor)' '. . . 2, 4 Philosophy ...... 5 Theology 6 .Standard Prose 10 Poctr) .... Law and Refereri' • Natural History . Art and Ornament Young People '1 RAVE I. AND ARCHAEOLOGY. ANCIENT ATHENS; it-, History, Topography, and Re- mains. By T. H. Dvr.K, LL.D. .Super-royal 8vo. copiously Illus- trated. \l. 5 J'. ' Dr. Dyer's volume will be a work of reference to the !>tudeiil of («reek History and literature, of the greatest interest and svAwt.' - Spfctalor. DESERT OF THE EXODUS. Journeys on loot in the Wilderness of tin- Forty Years' Wanderings, undertaken in con- nexion with the Ordnance Survev of Sinai and the Palestine Explor- ation Fund. By E. H. P.\LMKK, M..\., Lord .Mnioners Professor of Arabic, and Fellow of St. [ohn's College, Cambridge. With Maps and numerous lllustralions. 2 vols. 8vo. 1/. 8.f. 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Stokes, Associate of the Scottish Society of Antiquaries. With numerous Woodcuts and 6s5fine Photographic Illustrations. Imp. 4to. Vol. I. 4/. 4?. ; Vol. II. in the press. Selected Works 17 MOUNTAINS AND LAKES OF SWITZERLAND AND ITALY. 64 Picturesque Views in Chromolithograph, from Original Sketches by C. C. Py\e. With a Map of Routes aiid Descriptive Xote< by Rev, J. Mf.kcikk. 2nd Edition. Crown 4to. 2/. IS. RIVIERA, THE. I'en-and-Pencil Sketches from Cannes to Genoa. By Dkan .\i,KOKn. With 12 Chromolithographic Illus- trations and numerous Woodcuts, from Drawings by the Author Imp. 8vo. 2i.f. CRUIKSHANK (G.) a COMPLETE catalogue OF THl". EXGRAVI-:D works of. Including Etchings on Steel, Copper, i:c., and Woodcuts executed between the years 1805 and 1870. Compiled by G. W. RF.m. Keeper of the I'rints and Drawings in the British Museum. With a large number •f Illus- trations, chiefly from the Original Plates and Blocks. In 3 vols. royal 4I0. 12/. 12s. FLAXMAN. lectures ox sculpture, as delivered before the President and Members of the Royal Academy. By J Flaxm.\n. R..\. Willi 53 Plates. Xew Edition, y. H EATON MRS.) a coxclse hlstorv of PAIXTIXG FOR STCDEXTS AND GENERAL RE.\DERS. By Mrs. Hkaton. With Tllustralions. 8vo. 15J. DRAWING COPIES. By P. H. Del.vmotte, Professor of Drawing ai Kuig's College, London. 96 Original Sketches in .Architecture, Trees, Figures, F'oregrounds, Landscapes, Boats, and Sea-pieces. Royal Bvo. Oblong, half-bound, \is. By Eliza Meteyard. MEMORIALS OF WEDGWOOD. A Series of Plaques, Cameos, Vases, &c., selected from various Private Collec- tions, and executed in Permanent Photography. With Iniroduction and Descriptions. Imp. 410. 3/. y. WEDGWOOD AND HIS WORKS : a .Selection of h.s clioicesl I'laijueb, McdalUons, \'.imis, iVc, from Designs by F'LAX- MAN and others, in Permanent Photography, with a Sketch of his Life and of the Progress of his .-\rt Manufacture. Imp. 4to. 3/. y. CATALOGUE OF wedgwoods manufactures. Willi Illustration? Half-bound 8vo. lOt. 6./. WEDGWOOD HANDBOOK. A Manual for Collector* : Treatuig of the Marks. Monograms, and other Tests of the Old Period of Manufacture ; alst) mcluding the Catalogues wjlh Price^ obtained at various Sales, together with » Glossary of Terms, iyr, lOJ. bd. 18 George Bell and Sons' OLD DERBY CHINA FACTORY. The Workmen and their Productions. Containing Biographical Sketchch of the chief Artist-workmen, the various Marks used, Facsimiles from the old Derby Books, and original Frici; Lists of more than 400 Figures ,1 II d Groups, I'i.'c. With i2('oinured Plates and numerous Wood- cuts. By John Hasi.km. Imp. 8vo. 31.5. 6(/. 'That which has been done so well by Miss Meteyard for Ktruria, by Mr. Binns for Worcester, and by Mr. Owen for Bristol, has now been done for th'; Derby works with at least eijual zeal, intelligence, and ability, by .Mr. Haslcui.' Staffordshire Advertiser. FOR YOUNG PEOPIJ'.. AUNT JUDY'S MAGAZINE. Edited by n. K. K. GATTi and J. H. E\\in';. Imp. i6mo. handsomely bound. Containing Stories, Songs. Music, I'apers on Natural History, Fairy Tales, &c. &'C. With uinnerotis Illustrations. 6d. monthly. Yearly vohunes, 7*. (yd. each. Some of the early volumes may lie had at a reduced price. By Mrs. Alfn'ii Catty. PARABLES FROM NATURE. With Notes on the Natural History : and numerous lar^e Ilhistrations by eminent Artists. 4to. cloth gilt, 2i,v. .\lso in 2 vols. lo.f. 6d. each. i6mo. with Illustrations. First Series, i6th Edition, \s. 6d. Second Series, loth Edition, ■zs. The two Series in i vol. y. 6d. Third Series, 6th Edition, is. Fourth Series, 4th Edition, 2s. The two Series in one vol. 4-c Fifth Series, 2.r. WORLDS NOT REALIZED. i6mo. 4th Edition. 2i. PROVERBS ILLUSTRATED. i6mo. with iiiustra- tioD^. 4lh Edition, 2.t. A BOOK OF EMBLEMS. Drawn on Wood by F. Gilbert. With \'erl)Hl Illustrations and an Introdtiction. Imp. i6mo. 4J-. 6(1!'. WAIFS AND STRAYS OF natural history. Willi C'oloiHvd I'voiuispiece and Woodcuts. Fcap. y. 6d. THE POOR INCUMBENT. Fcap. Svo. Sewed, i..-. cloth, ij. 61/. AUNT SALLY'S LIFE. Wiih Si.x illustrations. Square ibnio. 3rd I'^dition, y, 6d. Selected Worh>. 1% THE MOTHER'S BOOK OF POETRY. SelcctH and Arranged by Mrs. A. (jAI I'V. Crown 8vo. with Illustrations, elegantly hound, 7.*. 6d. A BIT OF BREAD. HyjK.W Mack. I ranslatcd frnni the Irincli l)v .Mrs. .\i.i KF.r) Gatty. 2 vols. fcap. 8vo. Vol. 1. 41. (xi. Vol. 11. ii. 6cruc|ilion M\d connnoii scn^t-.' Siitiin/ay Rf.it-Hr THE BROWNIES, and other Talcs, illustrated by (;k<.r,;k Cruiksiiank. 3rd Edition. Imj). t6mo. jj. ' Mrs. Ewiiig gives us some really ch.iriiiing writing. While her first sior>- most prettily le.ichcs children how much they can do to help their parents, the immediate result will be, we fear, anything hut good. For if a child once begins " The Brownies," it will get so deeply interested in it, that when bed-time comc- il will altogether forget the moral, and will weary its parents with importunitie-- for just a few minutes more to sec how cverj'thing ends. 'The frontispiece, by the old friend of cmr childhood, (leorge Cniikshaiilc, is no le^-. pretty tli.in the .tory.' — Sttliiniiiy J\e-'ii-~.v. MRS. OVERTHEWAY'S REMEMBRANCES. Illustrated with 10 fine Full-page lingravmgs on Wood, aftei Drawings In I'asolik.k andWoi.i. 2nd TLdilion. cloth gilt, 3>. W. ■ It is not often nowad.iys the privile(»e of a critic lo grow enthusiastic over .. new work ; and the rarity of the occasion that calls forih the delight is apt to lead one into the sin of hyperbole. .Viid yet we think we shall not be accused of extravagance when wc say that, without exception, "Mrs. Overtheway's Re- membrances" is ihe most delightful work avowedly written for children ihal we have ever read. 'There are passages in this Uiok which the genius of f.eorge F.liol would be proud to o«ii It is full "f a peculiar, heart-siirring |>alhos of its own, which culminates in the last pages, when Ida finds that her father is not (lead. The book is one th.-»t may Ijc recurred lo often, and always with the same delight. Wc predict for it a great (lopularity.' — l.fader. 20 George Bell and Sons By Airs. Ewin}^ — Continued. MELCHIOR'S DREAM, and other Tales. Illustrated. 3rd Kdition. Fcap. 8vo. 3j-. 6d. ' " Melchior's Dream" is an exquisite little story, charming by original humour, buoyant spirits, and tender pathos.' — A them:- u in. A FLAT IRON FOR A FARTHING ; or, Some Passages in the Life of an Only Son. With 12 Illustrations by H. AllinghAM. 3rd Edition. Sniali 8vo. 5J. ' Let every parent and guardian who wislies to be amused, and at the same rime toplease a child, purchase " .A Flat Iron for a Farthing ; or. Some Passage.^ m the Life of an Only Son," by J. H. Ewing. We will answer for the delight with which they will read it themselves, and we do not doubt that the young and fortunate recipients will also like it. The story is quaint, original, and altogether delightful.' — A thenceum. ' A capital book for a present. No child who is fortunate enough to possess it will be in a hurry to put it down, for it is a book of uncommon fascination. The storj- is good, the principles inculcated admirable, and some of the illustra- tions simply delicious.'-- yfj/j/j Bull. LOB-LI E-BY-THE-FI RE; or, the Luck of Liiigborough. -\nd other 'J";iles. Illustrated by GEORGE Cruiksh.\nk. and Edition. Imp. ibnio. y. ' A charming tale by another of those clever writers, thanks to whom the children are now really belter served than their neighbours.' — Spectator . ' Mrs. Ewing has written as good a story as her " Brownies," and that i« saying a great deal. " Lob-lie-by-the-fire " has humour and pathos, and teaches what is right withoiu making children think they are reading a sermon.' — Snijf^riay Rci'inv. SIX TO SIXTEEN: A Story for Girls. With lO Illus trations by Mrs. Allingham. and Edition. Small post 8vo. 5^. ' The homely good sense and humour of the bulk of the story are set off by the pathos of its opening and its close, and a soft and beautiful light, as of daw-n and sunset, is thrown round the substantial English ideal of what a girl's eilucation ought to be, which runs through the tale.' — Spectator. ' It is a beautifully told story, full of humour and pathos, and bright sketches of scenery and character. It is all told with great naturalness, and will amuse grown-up people quite as much as children. In reading the story, we have been struck especially by characteristic bits of description, which show very happily the writer's appreciation of child life.' — Pall Mall Ca-M'tte. 'We have rarely met, on such a modest scale, with characters so ably and simply drawn . . . The merits of the volume, in themselves not small, are much enhanced by some clever illustrations from the pencil of Mrs. Allingham.' — AthtHaunt. 'The tone of the book is plea.sanl and healthy, and singularly free from that sentimental, not to say "' mawkish,'' slain which is apt to disfigure such pro- ductions. The illustrations by Mrs. .\llingh:im add a special attraction to the little volume.' — Times. ' It is scarcely necessary to say that Mrs. Fwing's book is one of the best of the year.' — Saturday Review. ' There is in it not only a great deal of common sense, hut there is true humour. . . . Wc have not met a healthier or breezier tale for girls for a long period.' — .'icadoiiy. Selected Worko. H By AIn. Eu'ifix — Continued. JAN OF THE WINDMILL; a story of the Plains. Will, II llhistnitions by Hki i.\ \i i i\f;HAM. Crown 8vo. 8.>. 'S./. /h' Mrs. ORcilly. ' Mrs. O'Reilly's works need no commendation . . . the -lyle is si> ■j.ticxi. the narrative so engrossing, and the lone so excellent.' — 7<»//// /!////. LITTLE PRESCRIPTION, a,..] ..ther Tales With 6 Illustrations by W. H. Pkthekkk and otli<^rs. i6mo. 2s. M. ' A worthy successor of some charming little volumes of the same kind. . . . The tale from which the title is taken is for its grace and pathos an especial favourite ' — Spectator. ' Mrs. O'Reilly cmild not write otherwise than well, even if she were to try." ■ Morning r^st. CICELY'S CHOICE, a Story for Girls. With a Krontis- picce by J. A. Pa.squier. Fcap. 8vo. gilt edges, y. bd. ' A pleasant story. . . . It is a book for girls, and grown people will also enjoy reading it.' — At/iftionim. ' A pleasant, well-written, interesting story, likely to be acceptable to younf; people who are in their teens.' — Scotsman. GILES'S MINORITY; or, ScetK- at the Retl House. With 3 Illustrations, ibiiio. 2.f. 6(1. DOLL WORLD; or, Play and Earnest. A Study from Real Life. With 8 Illustrations. By C. A. Saltm.\ksh. i6mo. zj. 6 so much tnii; art :uid natural talent in the book that we are half inclined to take il away from the lx)ys and girls for whom it is « ritten.' — Tiinn. KATIE; or, the Sini])lc Heart. Hy D. Ricii.MoNn, .Author of .\niiii' .Maitland.' Illustrated by M. I. H(MtTH. 2nd Kdition Crown 8vo. y. dd. ' The family life w hich surrounds Katie is both pretty and natural. The tone is Kood, and the jiloi — wc speak I'rum experience- eng.iges a child'- interest with almost loo keen a sympathy.' — (iiiirrdr'iiM. QUEENS OF ENGLAND from the .\orman Con.jtiesl. H\ A. SiKK Ki.\.si). .\n .Abridged lulilion. with I'ortraii ot .\i. Hilda of I'landers. In 1 vol. crown 8vo. cloth, 6.r. (iti. THE ENTERTAINING NATURALIST, lu m,-. Lot DON. kevisrd and enlarged li.\ \V "- l>\M \-, IIS. Will, nearly 500 Illustrations. Po.st 8vo. 5 . INSECT ARCHITECTURE. HvRinnik Kdite^ibythe Rev. |. (;, Wii.iii. Author ol • 1 loiiws NVithoiit Hands.' Post 8vo w illi i)i-,irl\ 200 Illustrations. :;.. GLIMPSES INTO PET-LAND. Uy the kcv. j. t.. \V, M.A., r.l...'>. With l-'ronlispii-ce. Fcap. y. 'j;h(nd. It is written on au aitislic principle, cuIl^isdn{; of actual biographies of certain cleph.ints, squirrels, blackbirds, and ulial not, who lived ui die flesh : and we only wish that human bioKrapbies \i.ir .il«;ivs .is rnirrlainin^ and inslnutivc.' — Saturday Kf.'irM'. 24 George Bell and Sotifi' Selected Works. GUESSING STORIES; or, The' Burpri«\ig' Adventures of the Mnn with the Extra Pair of Eyes. P.y the late Rev. P. Free- man, M.A. 3rd Edition. ANECDOTES OF DOGS. Hy Ki.waku Jessk. With Illustrations. I'obi 8\(). cloth, -,.<■. With 34 Steel F'^ngravings after Coopf.k, L-VNOSKER, &c. ys. bd. NATURAL HISTORY OF SELBORNE. By GiLBERi Whiii:. Edited by Jesse. Illustrated with 40 En- gravings. Post 8vo. 5^. ; or, with the Plates Coloured, -js. 6d. CHARADES, ENIGMAS, AND RIDDLES. Collected by a Cantab. 5th Edition, enlarged. Illustrated. Fcap. 8vo. is. POETRY- BOOK FOR SCHOOLS, illustrated with 37 highly finished Engravings by C. \V. Cope, R.A., Helmsley. Palmer, Skill, Thomas, and H. Weik. 89th Thousand. Crown 8vo. gilt, 2s. 6d. ; cloth limp, is. GILES WITHERNE; or, the Reward of Disobedience. \ Village Tale for the Young. By the Rev. ]. P. Parkixso.n, D.C.L. 6th Edition. Illustrated by the Rev. F."W. Mann. Super-royal i6mo. IS. THE PILGRIM'S PROGRESS. By John bunyan- With 281 Engravings from Designs by ^\'ILLI.\M H.VRVEY. Post 8vo. 3.f. 6d. OLD NURSERY RHYMES AND CHIMES. Collected and arranged by a Peal of Bells. Fcap. 4to. Ornamental binding, 2J. 6(i. NURSERY CAROLS. By the Rev. Dr. Monsell, Rector of St. Nicholas, Guildford, with upwards of 100 Illustrations by LuDWiG RiCHTER and Oscar Pletsch. Imp. i6mo. ^. 6^ ^TilJDNVSOV"^ ^UIBKAKr6//\ ^«!/0JllV3J0^ <-3 ^OFCALIF0% %A{iviian# ^WEUNIVERJ/A o vj.lOSANCElfj> o "^/siiaMNfl^v^ ^OFCALIFO/?^ ^^Abvaaiiiv^^ ^' V^IUBRARYG^ A^illBRARYQ^ " ^^Aavaan# ^WEUNIVERiyA •^^^ — ^^ 5' o %a]AlNll-3i\V ^lOSANCElfj-^ o ^/sa3AiNn-3WV ^UIBRARYGc ^lllE ^OFCAllFOff^ ^OFC LLJ v< '^iuiNnmv^ ^OF-CAUF0ff4(^ ^OFCAIIFO/?^ >&AHVHfln-A^ 5 g ^ O ^WE UNIVERS//, a?IIRD\D\ C \WE UNIVERS//, '^^/smmiv vvlOS-ANCElfj> ^(J/OJITVJJO^ -A^OFCMIFO/?^ ^WEUNIVER% ^lOSANCflfj*^ ^weunive; i(^ 3 1158 01075 0361 "^^OAaviaiH^ '^ ^' >:lOS7\NCElfx^ ^OF 4OF 4OK n ^J'iliONVSOl^ %J13AINnjWV"^ >&AliVil8ll^\^'^ '^0}A\ ^x^mmO/-^ ^UIBRARY' -;,OFCA1IFO^' \WEUNIVFK':v^ ^lOSAKCnfr <\\\ IMVF . \n'^A>;mr, ^^T^i S'^rn