§ MR. RITCHIE
, in rising to move—That a Select Committee be appointed to inquire into the effects which the Tariffs in force in Foreign Countries have upon the principal branches of British Trade and Commerce, and into the possibility of removing, by Legislation or otherwise, any impediment to the fullest development of the manufacturing and commercial industry of the United Kingdom,said, there was an essential difference between his Motion and others on the same subject which had been brought before the House. All those other Motions had asked the House to commit itself to definite expression of opinion on the subject of our commercial policy, whereas he only asked for a Committee of Inquiry. His Motion was animated by no spirit of hostility to Free Trade principles; he desired simply an investigation into the causes of the depression in trade which had succeeded the brilliant and progressive period which preceded, 1873. Since that period the country had not been progressing, but had, on the contrary, been going 1824 back, and all classes of the community had undergone severe trials and privations. Nothing was more remarkable than the quiet manner in which the working classes had borne those trials. Since 1880 there had unquestionably been signs of improvement. But, as far as the export trade of the country was concerned, he thought it was very questionable whether, on the whole, although it had been larger than for some years previously, it had been more profitable. The exports had increased in volume, but they had not increased in value; while, on the other hand, the imports had increased both in volume and value. But, granting that a considerable improvement had occurred in the last two years, he did not think the present was, therefore, a bad time for asking the House to appoint a Committee of Inquiry. On the contrary, he thought it it was probably better that the inquiry should be held at such a time as the present, rather than at a time of great depression. He feared, also, that the present improvement was not likely to be of long duration. There was nothing more notable during the last two years than the occasional spasmodic attempt—if he might use the expression—which had been made by trade to come round and improve. On every one of these occasions, however, owing to there having been little or no elasticity in the improvement, after making a short struggle, the improvement had died away. In asking the attention of the House to the condition of the trade of the country, he could not begin better than by recalling to the notice of the House the very grave and weighty words uttered by the Prime Minister when last year he introduced his Financial Statement. The right hon. Gentleman considered it necessary at that time to draw attention to the fact that the improvement which had gone on for so many years in the condition of the country had not only come to a standstill, but that unmistakable signs existed that we were going back instead of forward. In reply to a request made by the Leader of the Opposition, the right hon. Gentleman promised to lay on the Table the statement on which his assertions were based. Although he had applied for it more than once, it had not yet been presented to the House, and therefore he was unable to make use of a document which 1825 would doubtless supply a great deal of valuable information. But the statement itself was of a sufficiently grave character to warrant him in quoting it again to the House, and in asking the House to afford him the means of inquiring how that state of things had been brought about. The right hon. Gentleman said—There is another point on which it is necessary to say a few words, because I think we have reached a period when I think it ought to be taken up. Changes are taking place which I believe neither the public nor Parliament are fully aware of. I wish Parliament to know that we are not making ground at present. Speaking for the last few years, without reference to Party differences, we are rather losing than making ground. The Revenue referred to is that derived from Customs, Excise, Stamps, and taxes. In the period 1842–58, the population increased ⅓ per cent; Revenue, 1¾ per cent; Expenditure, 2½ per cent. In the period 1859–73, population increased 1 per cent; Revenue, 3 per cent; Expenditure, 1⅓ per cent. In the period 1874–77, population increased 1 per cent; Revenue, 1½ per cent; Expenditure, 3¼ per cent. In the period 1878–9, population increased 1 per cent; Revenue went back 1½ per cent; and Expenditure increased 2⅙ percent.The right hon. Gentleman went on to say—There is another result which will be more simple and intelligible than that which I have just given. The readiest and simplest of all methods of illustrating the growth of wealth in this country is to be found in a reference to the proceeds of 1d. on the Income Tax. In 1841–2 it yielded £772,000; in 1852–3, £810,000; in 1877–8, £1,990,000; in 1881–2, £1,943,000. It has gone back this year. No such period, so far as I am aware, can be founded since 1842. The 1d. in the Income Tax, which most strictly represents, not the general condition of the people, but of the wealthier classes of the country, has gone back for the first time since it was imposed.This statement of the Chancellor of the Exchequer was, of itself, sufficiently alarming; but if examined in greater detail it would assume a still more alarming aspect. The Income Tax, as a whole, gave a sufficiently unsatisfactory indication of the condition of the country; but what of that portion of the Income Tax which was obtained from the manufacturing and trading community under Schedule D? The income assessed to the tax under Schedule D amounted in 1875 to £267,000,000, in 1876 to £271,000,000, in 1879 to £257,000,000, and in 1880 to £249,000,000. As, however, the population had increased 5 percent since 1876, the decrease of 8 per cent between that 1826 year and 1880 did not fully describe the actual decrease. The income in 1880 under Schedule D, corrected according to the increase of population, should be £285,000,000. These figures showed a decrease of 13 per cent in four years under Schedule D. There were other indications of the condition of the country that were equally important. The Customs and Excise revenue amounted in 1876 to £47,000,000, and in 1881 to only £44,000,000. Thus the House would see that in 1881 the consumption of articles under the head of Customs and Excise decreased £3,000,000; but, correcting the figures according to the increase of population, there was a decrese in 1881, as compared with 1876, of no less than 11 per cent. The consumption of coffee in 1880 was lower than it had been in any year since 1876. The consumption of tea, also, was smaller now per head of the population than it had been for four years. The same remark would hold good with reference to tobacco; while, with reference to spirits, the quantity had not been so low since 1871. No doubt there was much reason for gratification in that circumstance; but, at the same time, the consumption of spirits had always been considered an indication of the amount of money which the working classes had to spend. The consumption of malt was also lower than it had ever been since 1866. That was, of course, not unsatisfactory in itself; but it was an indication that the working classes had been earning less money. Then there had been a considerable increase in the pauper population, both indoor and outdoor. Scotland remained about the same in this respect; but England and Ireland had greatly increased. In England alone the increase of pauperism was considerable, even allowing for the increase of population, showing, as it did, an increase between 1876 and 1880 of 42 per cent in indoor, and 20 per cent in outdoor, able-bodied adult paupers. Ireland showed an in crease of 30 per cent in the indoor paupers, and 70 per cent in the outdoor. There had been, on the whole, a steady and large increase of pauperism in the United Kingdom until 1881, and that notwithstanding the fact that there had been a much more rigorous application of the Poor Law. Emigration had also increased from 109,000 in 1876 to 1827 227,000 in 1880. Railway traffic afforded another indication of the commercial condition of the country. Since 1877 there had been a falling-off in the traffic receipts from £3,550 per mile to £3,453 per mile; but those figures did not show the full extent of the falling off in the goods traffic, as there had been an increase in passenger receipts; and, if that were deducted from the total traffic receipts, the result would show a great decrease in the goods traffic. It would thus be seen, from everything generally acknowledged to be an indication of prosperity, that this country had not been progressing. The fact was that the country was going back, and, rightly or wrongly, that retrogression had been attributed by large numbers of the people to the commercial policy of the country, and a want of confidence had been engendered, which ought to be removed by a proper inquiry. This want of confidence had not been diminished by the unfortunate course adopted by France in reference to the negotiations for a Commercial Treaty. The hopes this country had indulged in as to the effect on other countries of our example had been falsified. So far from other countries following our example, they saw a country which had for upwards of 20 years been enjoying the benefits of Free Trade now putting an end to that régime, and adopting in exchange a Protectionist policy. No wonder, then, that a want of confidence was engendered in our commercial policy. Mr. Bright, in 1877, said that in France Protection was becoming weaker. So far from that being so, the action of France had shown, not that Protection was becoming weaker, but that it was becoming stronger. The negotiations with France had failed; but they might be sure that they had not failed for want of unremitting exertions on the part of Her Majesty's Government. This country had been represented on the Commission by a Gentleman who had inspired the highest confidence in the commercial classes of this country—the hon. Gentleman the Under Secretary of State for Foreign Affairs; and, notwithstanding all his efforts, he had failed to conclude a Treaty equally good with that which had expired. This country was, therefore, left free to adopt whatever policy might be most conducive to its own interests; and, for his part, he thought 1828 this a very good compensation for the failure of the Treaty. It was, unfortunately, the case that this country, whenever it had attempted to obtain any relaxation of Foreign Tariffs, was placed at great disadvantage through having nothing to give in exchange. Franco was much the same as she was in 1846, when Mr. Disraeli said—The republican party.….is opposed to what you call free trade as much as the commercial community. You have in France these two great interests, the politico-philosophical and the commercial, all working together against what they call the fatal principle of competition. There was but one way of ever gaining any relaxation of the mercantile system of France, and that was by diplomacy. The French Cabinet will do nothing without a treaty."—[3 Hansard, lxxxiii. 1331.]In 1860 the French Emperor negotiated the Treaty in spite of the opposition of the French people, and in return for concessions on our part. The Republicans were now in power. We had nothing more to give them, and nothing could be done. The failure to conclude a new Treaty with France had, undoubtedly, increased the feeling of want of confidence existing in this country as to its commercial policy. He had no doubt he would be charged with advocating a policy of Protection. The charge was utterly groundless. He did not advocate Protection. He believed it to be impossible; and, further, it was inconsistent with the position he took up. Not one of the large manufacturing industries of the country would be benefited by it. Take cotton, for instance. We exported four-fifths of our total manufactures, only retaining one-fifth for home consumption. No amount of protective duties in this country would raise the selling price of the four-fifths exported; and, if not the four-fifths, how could they do so in the case of the one-fifth retained? If we could not compete with foreign manufacturers in our own markets, how could we compete with them in their markets; and, if not, of what benefit to us would the relaxation of their Tariffs be? He repeated that he did not advocate Protection, nor did he desire it; neither did the manufacturing nor the working classes desire it. He felt certain that we could successfully compete with all the world if our manufacturers could secure a fair field and no favour. He hoped the inquiry he asked for would be granted, though he had, 1829 reason to fear otherwise. He confessed that he could not conceive, even from a Free Trade point of view, why an inquiry should be refused. The Government would probably take the same course in answer to his remarks as had been adopted on more than one previous occasion. A comparison would be drawn between the state of the country in 1840 and in the present year; and it would be shown, from the imports and exports, the consumption of articles of luxury, and the diminution of pauperism, that the country was now in a highly prosperous and satisfactory condition. It would, doubtless, be contended that the proper doctrine was to take care of the imports, and let the exports take care of themselves. But in that case the Government would be met by the difficulty of explaining the strenuous efforts made by them to conclude a Commercial Treaty with France, which was in direct opposition to such a doctrine. We always tried most earnestly to represent that all we did was done purely from philanthropic motives, and that we desired, above everything, to benefit the countries with which we endeavoured to make Treaties; but, somehow, those professions were unsuccessful, and only served to increase the suspicions of foreign nations. If the policy of the Government was that exports should be left to take care of themselves, why these efforts to make Treaties? If such be their policy, the only consistent course for them to adopt was that recommended under similar circumstances by an eminent authority—Mr. Newmarch—whose death he was very sorry to see announced in that day's papers. In 1877 that gentlemen wrote to The Economist as follows:—Let the party of excellent and honourable men, whom we have foolishly sent to Paris, take a speedy farewell of their polite antagonists, and let Lord Derby, than whom no one has a better right to perform the duty, intimate, once for all, to the French and all other Governments, that, like the age of ruins, the age of Commercial Treaties is past.That was the only legitimate course to pursue if the doctrine that we ought not to trouble ourselves about exports was correct. A Treaty was a bargain. It was nothing more nor less than Reciprocity, and was a flagrant violation of the principle that exports should be left to take care of themselves. He had 1830 said that there would probably be drawn a comparison between the year 1840 and the present year in order to show the triumph of Free Trade principles. No one could deny the immense progress that had been made since the former year; but he did deny that it was altogether, or, indeed, mainly attributable to our commercial policy. It had been for more owing to the industry and energy of the people, to the enterprize of our merchants, and to the development of our railway system. The fact was that for a long period of years this country was the emporium and the manufacturing centre of the whole world, and foreign countries had to come to us for goods which we alone could supply. Then, again, a network of railways was spread all over England before the foreign railway systems were in any way developed. In one of the speeches recently delivered at Leeds by the Prime Minister, the right hon. Gentleman, dealing with this point, after giving the volume of trade done between this and foreign countries, went on to ask why, if our prosperity was so largely owing to railways, the trade of the world had not been transferred to France, Germany, and the United States, which had as many railways and telegraphs as ourselves? But at the time of our great commercial advance, those countries were deficient in respect of railways, as a glance at the figures would show. In 1860 there were 988 miles of railway in Russia, and 14,000 in 1880; in Germany, 6,000, as against 26,000 20 years later; in France, 5,800, as against 14,000; and in the United States, 30,000, as against 86,000; and with the development of railways abroad so their demands for our manufactures had fallen off. But, after all, however interesting might be the comparison between 1840 and 1880, that was not really the point; the point was not whether the country was richer now than in 1840, but whether it was poorer than it was eight years ago. A very serious question to be borne in mind, in considering the subject of imports and exports, was that we were every year becoming more and more dependent on other countries for our supplies of food and raw material. Our wants were constantly increasing, and, in order to satisfy them, we could only give our manufactures in return. Our exports, then, ought to increase in 1831 a direct ratio with our imports, if we were to pay for the latter out of our national income. In 1872 the value of the animal and cereal food imported into the country was £75,000,000; and in 1879, £102,000,000, or an increase of 33 per cent; while our exports, which were our only legitimate means of paying for that supply, had diminished 20 percent. In 1872 we grew 54,000,000 cwt. of wheat, and imported 47,000,000 cwt.; in 1879 we grew 28,000,000 cwt., and imported 70,000,000. And with respect to meat, in 1872 we grew 26,000,000 cwt. and imported 4,000,000; and in 1879 we grew 24,000,000 cwt. and imported 8,000,000. The House would thus see how, year by year, we were becoming more and more dependent on foreign supplies for our very existence. To enable us to pay for these supplies our exports should not only not fall off, but increase. Were they doing so? He proposed to compare the exports of the years 1872 and 1880; but the figures for 1871 and 1879 gave a precisely similar result. In 1872 the value of our exports was £256,000,000; in 1680 it was £223,000,000; or in the former year £8 Is. per head of the population, and in the latter only £6 9s. 5d. Comparing the year 1872 with 1879, the decrease was still greater, and amounted to 30 per cent. If he separated the exports to foreign countries from the exports to British Possessions, the diminution in the exports to foreign countries was very remarkable. The value of our exports to foreign countries in 1872 amounted to £195,000,000, or £6 2s. 11d. per head; in 1880, to £147,000,000, or £4 5s. 9d. per head, a decline of no less than 30 per cent, or almost one-third, in our foreign trade. But if we looked to the British Possessions, the story was entirely different. In 1872 our exports to our Colonies amounted to £60,000,000, and, instead of decreasing 30 per cent like our foreign trade, they increased in 1880 to £75,000,000, or 25 per cent. That increase would have been still greater if it had not been for a decrease of about 20 per cent in our exports to Canada, and 25 per cent in our exports to Victoria, which was an evidence of the effect of their Tariffs. But to India, which not many years ago some Members of Her Majesty's Government did not lay great store upon as a market for our trade, our exports had increased from 1832 £18,000,000 in 1872 to £30,000,000 in 1880, or no less than 70 per cent. Nothing could show more forcibly the immense value to us, as outlets for our manufactures, of our Colonies, and the great importance of doing all in our power to draw them closer to us. Taking now the principal articles of our manufacture, we find that our cotton exports in 1880 were of almost exactly the same value as in 1872; but, unfortunately, to obtain the same amount of money, we had to give our friends abroad 25 per cent more in quantity. If we analyzed our cotton exports a little closer, and took the various countries separately, it would be found they had decreased between 1872 and 1880 as follows:—To Germany, from £6,000,000 to £3,000,000; to Holland, from £5,500,000 to £2,500,000; to France, from £3,000,000 to £1,750,000; to Egypt, from £4,000,000 to £2,000,000. Taking these countries together, the decrease in the value of cotton goods exported was 50 per cent; while the increase to India alone—namely, from £26,000,000 to £42,000,000—amounted to 65 per cent. With respect to woollen goods, the decrease of our exports between 1872 and 1880 was as follows:—Germany, from £12,000,000 to £3,000,000; Holland, from £3,400,000 to £1,600,000; the United States, from £7,000,000 to £2,500,000—a decrease in the case of these three countries from £22,000,000 to £7,000,000, or one-third. How had the exports of foreign countries gone on in the time? It must be remembered that they were very considerably handicapped by the Protectionist Tariffs; but, in addition, they laboured under other disadvantages. France had been invaded and overrun by foreign Armies, and saddled with an enormous Indemnity unparalleled in modern times. Her National Debt had increased from £16,000,000 to £120,000,000; and, in consequence of internal disturbance, the whole country had been completely disorganized. In such a state of things one might expect a serious decline in her export trade. But the exports of France, which in 1872 were £150,000,000, in 1880 were £138,000,000, a falling-off of 8 per cent only as compared with 20 per cent on our part; and that falling-off had been mainly in grain, flour, and raw sugar. The failling-off in the latter being owing 1833 to the large bounties given upon raw sugar by Austria, the bounty in France being given only on the manufactured article. From Germany, during the period he had named, there had been a continuous annual increase. The exports had increased from £116,000,000 to £152,000,000—that was according to the Statistical Abstract; but in 1872 the prices of many articles were not included in the Abstract. If they had been, the figures would have stood £136,000,000 to £152,000,000. The exports from Russia had increased 80 per cent; from Belgium, 10 per cent; and from the United States, 45 per cent. It thus appeared that while the exports of Germany had increased by £16,000,000 sterling, or 2½ per cent, those of Austria by £11,000,000, or 17£ per cent, those of Russia by £47,000,000, or 80 per cent; those of Holland by £13,000,000, or 25 per cent; those of Belgium by£6,000,000, or 10 per cent: and those of the United States by £71,000,000, or 45 per cent while the exports of France had decreased by £12,000,000, or 8 per cent—the decrease in the exports of this country amounted to £33,000,000 sterling, or 20 per cent. Was not this a sufficiently serious state of things to justify him in asking the House of Commons to inquire why we fared so much worse than other countries? On the subject of our foreign trade, there had lately been a considerable distribution of literature by Her Majesty's Government, and especially by the Board of Trade; and it seemed to be a recognized duty of the permanent officials of that Board to write and circulate disquisitions on Free Trade. He had been informed that a gentleman representing the Board of Trade had recently addressed a meeting of Trade Unionists on this question. ["No, no!"] He had been told so by one who said that he was present.
§ MR. RITCHIE
said, he, of course, accepted the contradiction, and withdrew his statement. But, at all events, the Board of Trade dealt largely in the distribution of Free Trade literature, and considered it its duty to circulate its Papers at the head-quarters of the 1834 trades' unions throughout the country. [Mr. BROADHURST: No.] He wished especially to direct the attention of the House to a Paper recently laid on the Table of the House and signed by Mr. Giffen, entitled—Report to the Secretary of the Board of Trade on recent changes in the amount of the foreign trade of the United Kingdom and the prices of imports and exports.If this document gave an accurate description of the state of things, then the complaints of our manufacturers were absolutely groundless, because in that Paper Mr. Giffen contends that if the prices of our manufactured articles had been largely lower of late years, the manufacturers had been recouped by the lower prices they paid for the raw materials. Before dealing with that contention he wished to say a few words on another contention of Mr. Giffen's in the same Paper. Mr. Giffen said—Quantities are the main question in such a matter, for it is the things produced which make wealth, whatever may he the money standard by which the wealth is nominally measured.That he entirely denied. It was certain that if the values of goods fell without a corresponding fall in the price of the raw materials, all classes interested, workmen and manufacturers, must suffer. The subject was of vast importance to the working classes, because, if the value of goods fell, wages must fall. Increase in quantity and decrease in value meant bad trade and low wages, and indicated, not prosperity, but the reverse. That, however, was always on the supposition that the decrease in value was not brought about by a decrease in the cost of the raw material. There were two kinds of export trade—one the result of there being no demand at home, which was a bad trade, and another the result of a demand abroad, which was a good trade. The former was the description of export trade that had been carried on in this country for some years past. In the latter case, values were maintained, and in the former values fell often below cost price with the consequent loss to all interested. Mr. Giffen denied that such loss has been incurred in our export trade, and endeavoured to show that manufacturers had done almost, if not quite, as well in 1879 as in 1873. A more incorrect and misleading statement had rarely been made by one in Mr. Giffen's position, as he believed he could 1835 show conclusively. The paragraph from Mr. Giffen's Paper to which he desired to direct the attention of the House was as follows:—In my two former Reports I touched upon, but did not discuss at any length, the question of the relative profitableness of our foreign trade at different times, allowing the assumption to pass that the years in which we exported at high prices would be more remunerative than the years at which we export at nominally low prices. It was hinted that this might not be the case, the actual returns in the years of export at high prices being possibly no better than the actual returns in the years of export at nominally low prices, since the official figures of imports and exports are obviously not the same as the prices realized by importers and exporters; but, as bearing on the question of relative profitableness, it may be interesting likewise to point out that, to a largo extent, the apparent reduction of our export trade between 1873 and 1877 and 1878 must be apparent only, and is due to a change in which British labour and capital are not directly concerned. For instance, the real British produce exported in our cotton manufactures is not the whole nominal amount, but only that amount less the value of the raw material imported. It may possibly happen, then, that if the value of the raw material previously imported and used in the manufactures we export could be deducted from the exports, the real exports thus shown would exhibit a steady advance. The decline in our exports would in that case have been exclusively due to the diminished value of the raw material which we had paid for. That this is the real explanation of a large part of the apparent diminution of the exports between a year like 1873 and years like the last four is also obvious. Altogether, in 1873 we imported 13,639,000 cwts. of raw cotton, at a total cost of £54,704,000, while in 1879 we imported very nearly the same quantity, viz. 13,119,000 cwts. at a total cost of £36,180,000, the exact cost in 1879 for exactly the same quantity as in 1873 being about £37,500,000. There is consequently a difference of £17,200,000 between the value of the same quantity of raw cotton available in 1879 and 1873; and allowing that four-fifths of the raw cotton is manufactured for export, four-fifths of this sum of £17,200,000, or £13,760,000, must represent in the exports of cotton manufactures a mere difference in the value of the raw material contained in them, the raw material thus contained being, of course, neither the produce nor manufacture of the United Kingdom. Actually more raw cotton was used and exported in a manufactured form in 1879 and 1880 than in 1873, the exports of piece goods, for instance, increasing from 3,483,000,000 to 4,495,000,000 yards, or about 30 per cent; but even if only the same quantity had been used, the different value of raw material used would have made a difference of about £14,000,000 in the value of the exports. Of course, there are some exports of British produce and manufactures, such as coal and iron, to which this explanation would not apply; but it applies, apparently, to about two-thirds of our whole exports of British and Irish produce.1836 It would thus be seen that Mr. Giffen took cotton as the illustration from which he drew the inference that manufacturers had been recouped for the lower price of the manufactured article, by the reduction in the price of the raw material; but the fallacy of the inference would be shown on examination. In. 1879 the value of the cotton goods exported was £64,000,000, and in 1873 £77,400,000, showing a deficiency of value received by manufacturers in the former year, as compared with 1873, of £13,400,000; but against this Mr. Giffen stated that the cost of raw cotton imported was £13,760,000 less in 1879. than in 1873, thus, if his theory was correct, the manufacturers actually made £360,000 more in 1879 than in 1873; but taking 1880 the result would be still more startling. In 1880 the value of the cotton manufactures exported was £75,500,000, as against £77,400,000 in 1873, a deficiency of value received by them in the former year of £1,900,000 as compared with 1873; but if against this was put the lower cost of the raw material received in 1880, estimated by Mr. Giffen at £14,000,000, the result to the cotton manufactures in 1880 would be a larger profit by £12,000,000 than in the year 1873, which was one of the best years ever known. A further proof of the fallacy of Mr. Giffen's inference that cotton manufacturers have been recouped for the low price of their manufactures by the low price of the raw material was given in the very Paper itself, for it would be found in the tables annexed that the cotton yarn exported in 1880 was 25 per cent lower in price, and the cotton cloth 20 per cent lower in price than in 1873, while the raw material was 25 per cent lower; but as on every pound of cotton valued at 7d. there has to be expended5d. in labour and charges before it was made into cloth, a fall of 20 per cent in the cloth. meant a fall of 35 per cent in raw cotton, and as the fall was only 25 per cent, it would be seen that the manufacturer was worse off by 10 per cent in 1880 than in 1873, instead of being much better off. If Mr. Giffen was wrong in his inferences with reference to cotton, how much more wrong was he with reference to all the other principal articles of our manufacture? Mr. Giffen says that with reference to two-thirds of our manufactures his statement would 1837 hold good. He had, he thought, shown conclusively that Mr. Giffen was entirely wrong as to cotton. He would now take the other principal articles of export. To coal, iron, fish, cement, and alkali, which, together, amounted to £46,000,000, being entirely of British origin, it could not be applied, the entire reduction in value being a loss to this country. In jute goods, amounting to £4,000,000, he found the reduction in the price of the manufactured material had been 25 per cent, while the raw material had been positively 12½ per cent higher. In flax goods, which amounted to £6,000,000, the reduction in the price of the manufactured article had been from 7 per cent to 12½ per cent, while the reduction in the price of the raw material had been 8 per cent. In wool, the reduction in the price of the manufactured article had been 20 per cent, while the reduction in the price of the raw material had been 7 per cent, the woollen exports amounting to £19,000,000. In refined sugar, the reduction in the manufactured article had been 20 per cent, and in the raw material 12 per cent. In oil, the reduction in the manufactured article had been 15 per cent, and in the raw material 10 per cent. In paper, the reduction in the manufactured article had been 25 per cent, and in the raw material 12½ per cent. In leather goods, the reduction in the manufactured article had been 12½ per cent, and in the raw material the same. It must not, of course, be forgotten that the reduction in the manufactured article was a reduction on the goods after all the expense of manufacture. Of these articles the total amount of the exports was £82,000,000, and, adding the amount of the cotton exports, the entire sum came to £152,000,000, out of a total sum of £162,000,000 dealt with in Mr. Giffen's Paper. It would thus be seen that the statement made by Mr. Giffen that manufacturers have been recouped for the low prices of their goods by the low price of the raw material was entirely fallacious and misleading. He had endeavoured to discover where the fallacy in Mr. Giffen's calculations lay; and he had found that that gentleman, not knowing the quantity of cotton which had been worked up into the manufactures exported, had taken the weight of cotton imported in the previous year as 1838 the weight of the manufactured goods exported. Every commercial man, however, would know that the weight of the raw material was no indication of the weight of the manufactured goods exported. To arrive at a sound conclusion on the point they must know what the stocks were at the commencement of the year, and what they amounted to at the end of the year. The best proof of the incorrectness of Mr. Giffen's calculation in this respect was the fact that we only imported 6 per cent more in weight of the raw material in 1880 than we did in 1873, while we exported 30 per cent more in weight of the manufactured article. He now proposed to consider the question of the adverse balance of imports over exports, which had been so much dwelt upon recently. He was not one of those who held that our imports exceeding our exports was to be regretted. What I was so unsatisfactory was that our imports increased, while our exports diminished. I Our imports must exceed our exports. There could be no profitable trade without it. So long as excess imports represented legitimate earnings it was well. If we went beyond that, we should be spending capital, which was bad. Was that the ease with us. In the years 1866–70 the adverse balance was £290,000,000, or, per annum, £58,000,000; in 1871–5, £312,000,000, or, per annum, £62,000,000; in 1876–80, £622,000,000, or, per annum, £125,000,000. In our most profitable years the adverse balance was the smallest—namely, £60,000,000—while in our years of greatest adversity the adverse balance advanced to £125,000,000, which was more than double. The change had been very sudden, and had been coincident with depression. Had the additional imports been paid for by legitimate means, or were we spending our capital? That question certainly called for investigation and explanation. The adverse balance was attempted to be accounted for by three different items—first, cost of carriage; secondly, profits; thirdly, interest on foreign investments. In the discussion last year on this subject, the hon. Member for Bolton (Mr. J. K. Cross), in order to show the necessity of our imports largely exceeding our exports, took three examples—namely, cotton, iron, and wool, of which he assumed shipments had been made of the value of £1,000 each. 1839 The hon. Member contended that, to recoup himself for this £3,000 exports, he must import goods for £6,920, so that in the tables of exports and imports the £3,000 exports must be represented by £6,920 of imports. How was that conclusion arrived at? Why, by calculating an outward freight of £3,050. But, as a matter of fact, the exporter did not receive that back. It was paid to the agent abroad. He had only his original £3,000 to get home. But did not the agent for the ship owner remit the freight? No; it was spent in coal, wages, charges, loading, &c, only the homeward freight and charges must be allowed for. For that M. Mongredien allowed 11 per cent; but, as one-third was in foreign bottoms, only two-thirds of the £11 could be reckoned, which was £7 per cent. Mr. New march, to whose death he had already alluded, calculated 5 percent, Mr. Bourne calculated the same, while Mr. M'Kay calculated 8½ per cent. It would be fair to take the medium, say 7 per cent. The £3,000 sent out would, therefore, be represented by an import of £3,210, and not £6,920, as stated by the hon. Member. Assuming, therefore, that the exports must exceed the imports by 7 per cent for homeward freight and charges, this would reduce the adverse annual balance by £27,000,000. Then there was the second of the two heads—profit. In a little book called Popular Fallacies regarding Trade and Foreign Duties, by E. J. Pearce, issued by the Cobden Club, he found that Mr. Pearce had corrected the figures of the hon. Member for Bolton. He had pointed out the error about outward freight; but he found fault because the hon. Member for Bolton had left out "profit." Why was that left out? For a very good reason. Because, as a rule, there had been none. It was lucky if the goods realized the invoice price. Mr. Pearce was determined not to err in this way. He supposed a case of a hardware cargo sent to New Orleans. The voyage would occupy three months, and he calculated there would be a profit of 20 per cent out, and 20 per cent home, equal to 160 per cent per annum. He congratulated Mr. Pearce on that result; he would like to be a partner with him in such an undertaking. The adverse balance would soon be accounted for in this manner. 1840 He need hardly say, however, that such a calculation was an absurdity. There were three different methods of shipping goods—firstly, where the merchant bought and consigned; secondly, whore the manufacturer consigned; and, thirdly, where the shipment was on account of a foreign buyer. In the third case there was, of course, no profit at all to be reckoned. The profit, if any, was retained in the foreign country. In the second case, when the manufacturer consigned it was a sure sign that no profit could be made. In such a case he was only too glad to receive the invoice price. In how many instances did this happen, and was there not more generally a loss? Was it not certain that in times of depression there was a loss? In the first case, that of the merchant buying and consigning, as for the last few years prices had been gradually but steadily falling, the turn was always against the buyer, so that even in the case of the merchant consigning there had of late years been more commonly a loss than a profit. Looking, therefore, at all the various modes of shipping goods, he thought it was much safer to accept the conclusion of the hon. Member for Bolton, founded on experience, and calculate on no profit having been made in recent years on the export trade, rather than accept the figures given by Mr. Pearce. There remained the question of interest on our foreign investments. It was assumed that the amount we had to receive on this account was from £30,000,000 to £35,000,000 per annum. The receipts from India amounted to about £10,000,000. That made a total of £40,000,000 to £45,000,000. If to that were to be added £27,000,000, the profit of our carrying trade, we arrive at a total of £72,000,000. If we deducted this sum, therefore, from the gross adverse balance of £125,000,000 per annum, it would still leave an adverse balance of £53,000,000 per annum. Mr. Giffen had recently read a very interesting Paper before the Statistical Society on the subject of our imports and exports; and, dealing with the subject of our loans abroad, he expressed views which were contrary in many respects to those of M. Mongredien and others who agreed with him. M. Mongredien expressed an opinion that, of late years, foreign countries had not increased their indebtedness to us; but, in Mr. Giffen's 1841 Paper, lie contended that foreign countries had increased their indebtedness to us to the extent of £209,000,000 during the last few years. If Mr. Giffen was right, we ought not to calculate on having to receive the £45,000,000 we had assumed to receive during the last five years as interest. This £45,000,000, instead of being received in the shape of imports, was left abroad and lent out again; and, if this were so, this sum must not be calculated in reduction of our adverse balance, so that we were thus left with only £27,000,000 for freight to reduce the adverse balance of £125,000,000. Mr. Giffen, however, in the Paper referred to, contended that, instead, of amounting to £27,000,000, the freight and charges to be remitted home amounted to £80,000,000 per annum. Even so, the adverse balance would be still £45,000,000. Mr. Giffen, however, calculated both inward and outward freight. He had already shown that we had no right to calculate outward freight, so that, even assuming Mr. Giffen's calculation of £80,000,000 outward and homeward freight and charges to be correct, a very large deduction had to be made from this on account of the outward freight; but could it be doubted that Mr. Giffen's estimate was greatly in excess of the actual amount, which no one had previously estimated at more than £42,000,0000? According to his calculations, the annual excess of imports unaccounted for was £53,000,000, if we calculated that the interest on foreign loans had been remitted in goods, or £ 100,000,000 if the interest had been retained abroad, and re-lent, as Mr. Giffen said had been the case. Mr. Giffen admitted that the adverse balance amounted to £45,000,000. If the lower figures were correct, the aspect of the case was very grave; if the higher, it was most alarming. How was that excess paid for? It was certainly not paid for by bullion; the only other way would be by parting with our securities. Now, in a work recently published by Mr. Bourne, an eminent statistician, and sub-head of the Statistical Department of the Customs, he asserted that there was good reason to fear that payment for our excess imports was being made in this way; and he had the authority of the manager of one of the largest banks in London for the statement that the amount 1842 of foreign securities deposited with, bankers had largely diminished. The net practical result of what he had been endeavouring to show was, firstly, that all the usual indications showed the state of the country to be very grave, and that, instead of continuing to advance, we were receding; secondly, that the falling-off in exports was most serious, looking to the fact that we were yearly becoming more dependent on foreign countries for the necessaries of life; thirdly, that reduction in value had not been compensated for by reduction in the price of raw material, but that, on the contrary, we were compelled to give, year by year, more of our labour for less money; and, fourthly, that the yearly increasing adverse balance of imports was not to be accounted for by our carrying charges or by our foreign income, but was, it was greatly to be feared, coming out of the accumulations of the country. Whatever objections might be taken to his statements, it could not be denied that, at least, he had made out a case for inquiry. It might be contended that he had not proved this state of things to be the direct consequence of Foreign Tariffs. It was difficult to do this; but, surely, primâfacie, it could hardly be disputed—at least, it could hardly be denied—that a reduction in Foreign Tariffs would stimulate our export trade. This was shown by our trade with France. In 1360 our exports to that country were only £5,000,000; in 1880 they were £16,000,000. It was essential to our very existence that our foreign export trade should be increased. The question was, how was this to be done? Would it have the desired effect if we threatened retaliation in the event of a continuance of hostile Tariffs? All this was a legitimate subject for inquiry. There was nothing against the principles of Free Trade in Retaliation. Indeed, the President of the Board of Trade himself had advocated that policy in regard to French wines in the speech which he made in that House last August. Again, was it not important to inquire whether our fiscal legislation was as sound as it might be, and whether it would not. be possible to relieve the taxpayers of this country of some share of the taxes they paid by increasing the duties on some of the articles we imported? Then there was the ques- 1843 tion of drawing closer together the bonds which united us with our Colonies. If that were feasible, he was sure it would meet with the assent and support of all classes in the country, and of hon. Members on both sides of the House. He did not say the subject was free from difficulties; but, at any rate, it was worthy of investigation. He was not absolutely wedded to the terms of his Resolution, but would assent to any modification of them, as long as they enabled the investigation to be full and thorough. The matter was one of vital importance, which ought to be cleared up by full inquiry. In the remarks he had made he had confined himself solely to the commercial and manufacturing part of the subject. If, however, he had not referred to agriculture, it was not because he did not feel the enormous importance of the subject and the sufferings which had been borne by all those interested in this, the greatest of our industries. He had sat upon the Agricultural Commission now for many months, and it had been sufficiently demonstrated to him that much suffering had been entailed upon all classes of the agricultural community, except, perhaps, the labourers. He had said nothing on this subject, because he felt that while the Commission was sitting specially to investigate this very matter, and while its Report was even now in course of preparation, it would have been unbecoming for him, as a Member of that Commission, to enlarge on this most important subject. In conclusion, he appealed to the House, in the interests of all classes of the community, that they would grant him what he asked—namely, simply and solely a Committee of Inquiry into the whole subject of the state of the country and the adverse times we had encountered for some years, with a view of finding out the means of restoring that prosperity to the country which it was essential that it should enjoy. The hon. Member concluded by moving the Resolution of which he had given Notice.
To leave out from the word "That" to the end of the Question, in order to add the words "a Select Committee be appointed to inquire into the effects which the Tariffs in force in Foreign Countries have upon the principal branches of British Trade and Commerce, and into the possibility of removing, by Legis-
lation or otherwise, any impediment to the fuller development of the manufacturing and commercial industry of the United Kingdom,"—(Mr. Ritchie,)
§ Question proposed, "That the words proposed to be left out stand part of the Question."
§ MR. CARTWRIGHT
said, that, although according to the Forms of the House he was unable to move the Amendment of which he had given Notice, and which ran in the following terms:—That, in the opinion of this House, the commercial relations between the United Kingdom and Foreign Countries are not in a state to demand an inquiry by a Select Committee,still, he would briefly explain why he thought the opinions enunciated by the hon. Member for the Tower Hamlets (Mr. Ritchie) were such as should not recommend themselves to the House, but were unsound and mischievous. He maintained that not one of the hon. Member's propositions had been borne out; and he believed, in fact, that the real and main purpose of the Motion was in the direction of Protection in the shape of a reversal of the commercial policy that had been pursued by this country for many years. That aim and purpose was clearly expressed in the friendly Amendment, as he had every reason to believe, which had been put down by the hon. and learned Member for West Staffordshire (Mr. Staveley Hill), That Amendment distinctly advocated imposition of retaliatory duties against foreign nations, with the view of affording relief to the British taxpayers from burdens, and of artificially stimulating a development of trade with our Colonies. The latter allegation rested on a fallacy. It assumed that a certain extension of our trade must follow on the adoption of such a line of commercial policy by this country, from the alleged greater readiness of the Colonies to take British goods. That was a statement which had been very much put before the country by people who were seeking for Protection under the disguise of calling themselves Fair Traders. There was a gross delusion in the statement. The hon. Member for the Tower Ham lets had compared our trade to the Colonies in two distinct years. No comparison of any real value could rest on 1845 the data of two distinct years. The only data of real value for any comparison between the relative elasticity of our trade to foreign countries and to the Colonies could be furnished by the Returns not of single years, but of a series of years. Now, the examination of the amount of our Colonial trade during a period of 25 years would prove that its proportions to the total of our trade has, practically, remained stationary. In 1856 our trade with the Colonies was about 25 per cent, and in 1880 it remained 24 per cent, of our total trade. There were fluctuations, no doubt; but he denied that the fluctuations were greater than those which marked our trade with foreign countries, and there was no indication of a greater elasticity in our Colonial trade. The reference to the undeniable extension of our trade with India was beside the purpose, for our Indian trade could not serve as a fair gauge for our Colonial trade. The Indian Tariff was made by ourselves according to our commercial views. But the Colonies were self-governing, and made their own Tariffs according to their views. Now, it was an incontrovertible fact that, with the solitary exception of New South Wales, in every British self-governing Colony the present Tariff was higher than the Tariff as it stood in 1859—the year before the conclusion of the Anglo-French Commercial Treaty—and, therefore, the point of time when commenced the commercial relations against which the hon. Member for the Tower Hamlets inveighed. But, while he asked us to believe that English trade was being crushed out by the adverse and hostile action of a reactionary and protective system adopted of late years by foreign countries, how did the matter really stand? Why, whereas every English-speaking self-governing Colony, with one exception, at present imposed higher duties on British goods than in 1859, notwithstanding the unfortunate return towards a protective system in many Foreign States, there was only one which at present still had a Tariff with duties notably lower than they were in 1859—and that one State was the great English-speaking Republic in America. He wanted to know, then, how a law could be made out from these facts in favour of a discriminating Tariff against foreign countries, with their higher 1846 Tariff for the benefit of the Colonies with their pronounced Protectionist systems? The whole question of whether Protective Tariffs had done much injury to, and were really crushing out, British industry and manufactures might be tested by our commercial relations with the United States. The United States had been exactly following out the policy which certain hon. Gentlemen opposite wished to see prevail in this country; and what had been its effect there? A comparison between the industries of the United States and of Great Britain afforded a crucial test for the two systems. We, under Free Trade economy, produced and exported something like £190,000,000 worth of manufactured articles; the United States exported something less than £18,000,000, under the fostering care of Protection. In 1880, notwithstanding the high Tariff of the United States, we exported upwards of £24,000,000 of manufactured articles to the United States; whereas the United States, despite Protective stimulants, did not import £3,000,000 of manufactures into Great Britain. The case was still more strikingly illustrated by reference to the relative positions of British and American shipping. There was no country in the world so favourably situated for becoming a first class shipping country as America; and yet, notwithstanding Protection, upwards of 50 per cent of the American trade was carried in British bottoms, and only 16 per cent carried in American vessels. That was most conclusive as to the relative action of Protection and Free Trade. The hon. Member for the Tower Ham lets, throughout the whole of his speech, had taken not normal, but abnormal years as tests, without making any allowance for that fact. For instance, he did not hear the hon. Member say a single word as to the inflated development of British trade in the years 1871 and 1872, to which he kept referring. In bringing an indictment against the commercial policy of the country, it was not quite fair to base sweeping arguments upon abnormal years, and on exceptional circumstances. The hon. Member did not grapple with the subject of British shipping at all, which had grown immensely; and he omitted to take any account of the interest of British trade arising from monies invested abroad. Upon the question of duties it was really impossible to 1847 draw a distinction between raw material and manufactured material; for what was called raw material one day was called manufactured material another day. Some articles which constituted the material for important branches of our industries were ranked as manufactured articles in Foreign Tariffs. Towards the end of his speech the hon. Member touched on the subject of agricultural depression; but said he would not go into the subject because he was a Member of the Royal Commission on Agriculture, and, therefore, he thought it right not to advance any opinion; but, not being himself a Member of the Commission, he would say a word upon the subject. In his opinion, the agricultural depression had been mainly instrumental in producing the commercial depression of the country; for everyone connected with agriculture, whether landlord or tenant, had heavily suffered, and those losses had necessarily involved stringent retrenchment. But this stringent retrenchment on the part of the agricultural classes had also necessarily affected the home market, which, in a large degree, dealt with those classes. He was not about to discuss the whole question of all the causes which had led to our agricultural depression. He only wished to dwell on one point closely connected with the commercial fallacies of those who advocated Protection. It was not the case that the depression of farmers in England was wholly due to foreign competition—to their being undersold by American importers. That this was not so could be proved by figures. The hon. Member for South Leicestershire (Mr. Pell), in his Report as a Commissioner to investigate the agricultural resources of the United States, had given elaborate calculations to the effect that it would not pay to import in the long run American grain into this country for less than 48s. a-quarter. His figures were much canvassed at the time; but they had been proved correct by fact. He held in his hand a Return with which he had been favoured of the price of wheat in Mark Lane month by month since the time when their calculations had been made; and from this Paper it appeared that only on three occasions—in September, October, and November, 1880—had the price temporarily fallen below 48s. But what had ruined many a farmer was the cir- 1848 cumstance that he never was in a position to offer any article that would fetch any price at all in consequence of its deterioration through quite exceptionally disastrous atmospheric conditions. The fact was a number of circumstances concurred to aggravate the agricultural conditions. The wild and gambling speculation which had seized our industrial classes, and led to inflated periods of so-called prosperity, had also extended to farmers. They took farms at rents which were excessive, and so in evil times they found themselves involved in money engagements beyond their means, and in possession of an article so damaged as to be unsaleable. This was what had broken so many farmers in this country; but not the fact of any importation of American grain at prices of excessive lowness, for that grain, as a rule, fetched only 48s. a-quarter; whereas the British agriculturist, from the disastrous seasons, came into Mark Lane with grain that was not fit for sale at all. There were, as it seemed to him, as many fallacies as could be crammed together in the Resolution of the hon. Member. Apparently, he feared any development of foreign industry, and thought a monopoly necessary for the prosperity of the country, though the only way of securing that monopoly was by imposing duties which he called retaliatory, but which would be paid, in reality, not by foreigners, but by the British consumer. The true test of Free Trade was whether, in the same circumstances, the position of the country would have been bettered by Protection; and he held that no arguments could be adduced in support of that proposition. He would only add, in conclusion, that he also took exception to the hon. Gentleman's statements as to pauperism, for he maintained that at no time had pauperism weighed so little as at present.
§ MR. MACIVER
said, he was glad that the Under Secretary of State for Foreign Affairs was in his place, as he should have to refer to him in very pointed terms. With reference to the speech that had just been made, it was almost altogether nonsense, although there were one or two remarks worth attention, as they might be taken in connection with a speech made some time ago, at Leeds, by the Prime Minister. It was then pointed out by the Prime Minister how American shipping had disappeared from the seas and 1849 its place taken by British ships, and he argued that it was because the Americans were Protectionists. He (Mr. Mac Iver) said, without hesitation, that this question between American and English shipping was simply one of materials. Years ago, when wooden vessels were used, the Americans could build them very cheaply, having the wood at their doors; but now, when ships were nearly all of iron or steel, the cost of importing the material and the higher rate of wages in the United States made it impossible for the Americans to compete with us in that respect. Free Trade, if it existed to-morrow, would not annihilate the cost of freight across the Atlantic, or of a long railway journey from the iron producing districts of America to the seaports. He rose in no spirit of hostility to the Motion of his hon. Friend the Member for the Tower Hamlets (Mr. Ritchie), who had, in a speech free from allusion of a Party character, called attention to a subject which the working population of this country properly regarded of greater importance than mere political considerations. The Motion was practically the same as one which he (Mr. Mac Iver) presented to the last Parliament on the 4th July, 1879, and which at that time received but scant support even from those who would now cordially support the same proposition. Since that time, however, public opinion had advanced, and was advancing, and a Motion defeated in the present House might not improbably be carried in the next Parliament. His main object in rising was to call attention to some of the replies lately given him by the Under Secretary of State for Foreign Affairs on the subject of the French Commercial Treaty. The subject naturally was distasteful to hon. Members opposite; and if the clôture existed, it might be that the noble Lord the Secretary of State for India would, supported by his undoubted majority, decree that they wanted to hear no more of it. But, while free speech was still possible, he desired to show the House that he had a perfectly good case. The Under Secretary of State for Foreign Affairs, replying to a couple of questions which he ventured to address to him last week, one of them in regard to shipping bounties, and the other in regard to the surtaxe d'entrepôt, raised a cheap laugh against him by referring him to the Blue 1850 Books. There was, however, a question of fact involved.
§ MR. SPEAKER
I must point out to the hon. Member that he is travelling beyond the limits of the Question before the House.
§ MR. MACIVER
wished only to illustrate the commercial relations of England and France. Now, the answers of the hon. Baronet——
§ MR. MACIVER
said, he was not aware that the answers of Ministers were, for the purposes of Order, regarded as parts of past debates. His purpose was merely to refer to the Blue Books, and to say that the case which he desired to present could not be better put than in the words of M. Challemel-Lacour, as contained in one of the Blue Books issued the other day. M. Challemel Lacour, at the Conference held in London, June 30, 1881, and reported on page 289 of Blue Book "Commercial—No. 37 (1881)," used these words—As to the criticisms of the French bounties to the Mercantile Navy, they are really quite out of place, the question having just been definitely settled by the Legislature. At the time of the preparation and voting of the law, the English Government might, perhaps, have sought, by diplomatic means, to influence the resolutions of the Government of the Republic; but now that it has to deal with an accomplished fact, it is impossible to see the fitness or the use of their observations, and the French Commissioners consider it necessary to decline to discuss the subject.He, therefore, contended that not only had this country not received any valuable concessions from France as regards the bounties on shipping, but that there was a time when Her Majesty's Government could have made diplomatic representations which might have brought about valuable concessions. He had now accomplished the purpose for which he rose, and he asked the House that the Motion of the hon. Member for the Tower Hamlets should not suffer by anything he (Mr. Mac Iver) had said, because that Motion had really nothing whatever to do with those questions of fact on which he was at issue with the Under Secretary of State for Foreign Affairs. Many men of all shades of politics regarded the Motion of the hon. Member for the Tower Hamlets as raising questions of more importance than Party considera- 1851 tions, because it vitally affected the prosperity of our people; and he appealed to the House to deal with it in that spirit. But before sitting down he desired to point out that the ships which, under the bounty system, the French were now having built in the yards of this country and of Scotland, and which for the moment provided employment for our workpeople, were built here simply because every shipbuilding yard in France was full, and only the surplus orders came to this country. That was not a state of things that was likely to last, and those who relied upon its continuance were like the person in the fable who killed the goose that laid the golden egg. The rolling mills of America wore increasing rapidly, and in a few months they would be able to make more rails than they could use. The trade of Sheffield was only temporarily brisk, and the revival would not last. He thought that every thoughtful man, knowing the condition of things, would feel in sympathy with the Resolution before the House.
§ SIR CHARLES W. DILKE
said, he felt a difficulty in replying to the hon. Gentleman who had just spoken, because he wished to avoid being called to Order, as the hon. Gentleman had been twice in the course of his speech. Perhaps, however, he might be allowed the same latitude as was permitted to the hon. Gentleman. The hon. Member had referred to the question of shipping bounties; but the question now under discussion related to Foreign Tariffs, and shipping bounties were not made the subject of Foreign Tariffs at all, and never had been so treated. The hon. Gentleman had quoted the words of M. Challemel-Lacour at the London Conference, and had said that Her Majesty's Government might have sought by diplomatic means to influence the views of the French Government in regard to those bounties. Now, the hon. Member was informed long ago that such diplomatic representations had been made. [Mr. MAC IVER: But made without result.]" What did the hon. Member think ought to have been done? The hon. Member said that the observations of M. Challemel-Lacour concluded the matter. He had advised the hon. Member to read the Blue Books, and he must repeat the advice. At the Conference in Paris he had returned to the subject and made a 1852 speech; and the hon. Member was not correct in saying that those were the last representations made on the matter. It would be out of Order, however, to discuss that question at length, because it did not fall properly within the scope of Foreign Tariffs, the subject immediately before the House. The speech of the hon. Member for the Tower Hamlets (Mr. Ritchie) had been already admirably dealt with by his hon. Friend the Member for Oxfordshire (Mr. Cartwright), whose remarks he was very sorry to hear characterized by the hon. Member for Birkenhead (Mr. Mac Iver) as nonsense—a word seldom used in the House, and one certainly very inapplicable to the carefully-reasoned speech of his hon. Friend. The observations of the hon. Member for the Tower Hamlets would be further dealt with by his right hon. Friend the President of the Board of Trade; but he could not help remarking that the hon. Member for the Tower Hamlets had proved nothing; but he had simply stated the case of his opponents, and had wound up by alleging that their observations were absurd, full of fallacies, or unworthy of the attention of the House. His speech was evidently intended to be popular with the Protectionist Party, without courageously and distinctly raising the flag of Protection. By hinting not obscurely in his closing words at the policy of Retaliation, he showed that he had that Protectionist leaning which he had earlier disclaimed.
MR. STAVELEY HILL
said, that the controversy between the hon. Member for Birkenhead and the Under Secretary of State for Foreign Affairs, was an incident in the debate with which the Resolution before the House had but little to do. He should contend that there might very well be Retaliation without any view to Protection at all. Retaliation had not necessarily anything whatever to do with Protection. Protectionists advocated the imposition of duties either to foster exotic trades, or to unduly encourage natural trades; but a retaliatory duty might be put on for fiscal purposes, without its being a protective duty. It did not follow that because a duty 'which was put on for one purpose might incidentally and partially have another result, that it was to take its character from that result; it would be just as reasonable to speak of drying 1853 the skin as the wetting of a towel. The hon. Member for Oxfordshire (Mr. Cartwright) had spoken of farmers giving speculative rents in 1875. What he believed from the instances within his own knowledge was, that farms were taken speculatively and money borrowed to carry them on with, and that the loans involved the borrowers in difficulties. But he believed there were very few instances in which farms were taken at enhanced rents on the faith of a future prosperity. The Amendment of which he had given Notice was in the following terms:—That, with a view to bring about a reduction of the heavy Duties now levied in many Foreign Countries upon British products and manufactures, and an assimilation of the fiscal system of the Colonies with that of the Mother Country, it is desirable for the purposes of Revenue, and to provide means for relieving many of the heavy burdens now pressing upon the producers and consumers of this Country, that Duties should be levied upon goods imported from such Foreign Countries: Provided that such Duties do not interfere with the amount of food required by the people of this Country."This had been spoken of as a friendly Amendment; but he had nothing at all to do with the Motion, and he thought the hon. Member for the Tower Hamlets would rather regard the Amendment as unfriendly. He would not now support inquiry by a Committee, unless the proposed terms of Reference could be very much enlarged. Although he might on other grounds advocate the appointment of a Committee, he would not do so if it were only to inquire into the question of duties levied by foreign countries, and were not to inquire whether, in any circumstances, import duties might not be levied by this country without their having a protective character. It was in May, 1869, that he moved for a Committee to inquire into the working of the French Treaty. He had just been returned for Coventry, which had been vitally affected by it; and as the term of the Treaty was to expire in a year, he thought he might fairly move for a Committee of Inquiry. The Motion was opposed by the Chancellor of the Duchy of Lancaster on the ground that the time was hardly suitable; and he was led to believe that the Motion might be renewed in the following Session with more hope of success. He, however, went to a division, in which the numbers were less 1854 than they would have been had it not been that at the time it occurred Lord Cairns was speaking on the Irish Church in the other House, and many Members were listening to him. The proposal was renewed in May, 1870, by way of Amendment, to a Motion by the hon. Member for Manchester (Mr. Birley), and since then he had not troubled the House on the subject, but had patiently waited until it should have fully ripened. What had been the result of our experience of the Treaty? It had expired, and it had had no mourners at all. There was no mistake about the depth of the feeling that pervaded the country on the subject. He had never mentioned it at meetings in Staffordshire and Lancashire, in manufacturing or agricultural districts, but the reference had been received with enthusiasm. He had been urged to bring it forward earlier, and in not doing so had subjected himself to violent restraint. He was no Protectionist at all; and he had never said a word in favour of protective duties, not even when he was Member for Coventry. If anything like protective duties were to be levied, they must be levied for a purpose wholly different from Protection, and that must be only of an incidental character. The title of the pamphlet which had been alluded to assumed that there was a question of "Free Trade versus Fair Trade." He denied that there was any such suit. The advocates of Fair Trade were out-and-out Free Traders in the fullest and most complete sense of the term. If they advocated Fair Trade, it was simply in order that they might bring about more complete Free Trade than we had had up to the present. He was sorry that a pamphlet containing such controversial statements had been issued by a permanent Under Secretary for whom they had the highest regard. In one paragraph, on page 4, sentiments were imputed to the hon. Member for Preston (Mr. Ecroyd), which he disavowed; they were put into turned commas, as if they were a quotation from a speech; and the hon. Member declared that he had never spoken the word, nor held the views that were attributed to him. He would pass away from this part of the subject with the remark that, Free Traders as they were, it was absurd to suppose that the people of England could be induced to accept Free 1855 Trade by such childish nonsense as was put forward in this book. There was one further point he would mention as an instance. Mr. Farrer went through the countries of the world which were Protectionists, and which, therefore, constituted the bulk of the world, and said that they sinned against light and against knowledge. It was nonsense for him to assert that a country could not be Protectionist and yet be successful; it was nonsense for him to state that countries were becoming more and more inclined to Free Trade. What was the case? France had put an end to the Commercial Treaty with this country, because she found that our imports into France were slightly increasing. On every item on which a somewhat increased import was shown she had pressed for increased duties. In three years the import of paper into France had increased by £490,000 a-year; that was stopped by the imposition of a high duty. It was obvious that France was determined to prevent any increase in our importations to her, and to become, in an evil sense of the word, Protectionist. With regard to Canada, Mr. Farrer asserted that she had greatly increased her Tariffs, and that they bade fair to rival the monstrous Tariffs of the United States. Did he mean to assert that Canada was not prosperous? She had to put on duties simply to bring her up to the level of the United States, and to prevent capital which might otherwise come to her going to the United States. She tried, under the Mackenzie Government, the policy of pure Free Trade, and the result was that nearly everyone in Canada was being ruined and made bankrupt. Then, in 1879, Sir John A. Macdonald went through the country advocating his National policy, which was Protectionist. It had been adopted, but the authors had distinctly disclaimed that it had been adopted against the Mother Country, and alleged that it had been introduced only as a protection against the United States. What had been the result of that policy? When he travelled through the country with the hon. Member for Oxfordshire, a short time back, they scarcely found one poor person. Instead of the difficulties with which the country had to contend, when the Mackenzie policy was the rule, Canada now was one of the most prosperous countries in the world. But it 1856 was upon the United States that Mr. Farrer poured out the full vials of his wrath. They were the greatest sinners, for they were the most intelligent, and ought to know so much better than to adopt Protection. Yet their present Tariffs ranged from 35 to 100 per cent, which, said Mr. Farrer, "was probably as near Protection as a working Tariff could be." Yet in the United States, in 1880, the imports exceeded the exports; £64,000,000 were paid off the Debt, and £20,000,000 were borrowed at 3 per cent. That was the effect of Protection upon the United States. How did Mr. Farrer account for the prosperity of the United States? He said that such were the magnificent natural advantages enjoyed by the country, and such the blessings of Providence, that, in spite of the folly of man, the United States did an enormous trade with us, and were in a prosperous condition. Did Mr. Farrer suppose that Providence was unduly kind to the United States? It would be very much better if Free Traders were to argue this question in a different manner. It would be very much better for them to admit, as all must admit, that it was possible for a country, and especially for a new country, to be Protectionist and yet to be prosperous. In discussing this question they naturally came to the consideration of the relation of imports and exports. He believed that a country might become very rich, so far as money went, by reason of cheap imports. To quote the words of the hon. Member for Manchester (Mr. Birley), in 1870—However beneficial it might be to the moneyed circle, to the trading class, as distinct from the manufacturing class, and to the commercial and shipping interests, it had not given any additional employment to the workpeople of this country, hut had had rather the opposite effect."—[3 Hansard, cci. 113.]If that were so, he did not think that the manufacturer should be protected at the expense of the two former classes; but they had to consider whether the State owed the manufacturer anything. What were the burdens which had been placed on the manufacturing classes? By their different sanitary laws they had laid upon the manufacturing classes very heavy and expensive burdens. The Mines Regulation Act, the Factory Acts, and many other Acts of Parliament had laid great and expensive burdens upon 1857 the manufacturing interests. He was not alone in holding that view. He held in his hand a Report containing the views of the largest ironmasters in England and Scotland. They said that one of the arguments used in 1860 by the French, in the discussions on the high duties on iron imports into France, was that the French ironmasters were then at a great disadvantage, in consequence of the legal restrictions placed upon them. The French ironmasters, therefore, claimed to be entitled to put forward the extra cost of production thrown upon them as a reason for the duty. That argument was accepted by Mr. Cobden as a reason why the French should put high duties on iron. The Report then went on to say that there was no longer any necessity for the imposition of that duty. Affairs had now changed, and it was the English manufacturers who were put to considerable expense in the production of iron ore; and the Report urged, therefore, unless the French duty were reduced, a retaliatory duty should be put on by this country. He might say that he had not selected that instance because it was the strongest. He thought that there was a right to place a certain import duty on goods coming into this country under circumstances such as these without it being considered a Protectionist duty. Very heavy expenses were laid upon the manufacturers by the Sanitary Laws; and how did they find other countries acted in the like circumstances? He hoped the right hon. Gentleman the President of the Board of Trade would have obtained details from their Ambassadors abroad as to the cost of production in France, Switzerland, and Germany, and of any sanitary regulations in force in those countries tending to increase the cost of production. Though they had not that information before them, yet they knew that there was no law in France such as that which most properly existed in this country for protecting the health of workmen and shortening the hours of labour. He believed that a Bill regulating the hours of labour was lately introduced into the French Assembly and rejected. The proposition was rejected on the ground that it would be a burden on labour. A foreign producer could, as it were, smuggle into this country articles free from sanitary requirements, which could not be produced here with 1858 out those sanitary requirements which our Legislature had imposed. Now, then, came the question, could we determine upon any figures that would represent the cost which the law put on ordinary manufactures which did not fall upon such articles in foreign countries? He said we could. He had carefully gone through the figures presented to him, and he ventured to say that the bulk of the goods manufactured in England were produced at a greater cost by 10 per cent in consequence of sanitary regulations such as he had referred to. Were we not, therefore, entitled to place an import duty of 10 per cent upon similar goods coming from countries where there were no sanitary regulations? He, for one, would not put forward any desire that there should not be a considerable import of manufactured goods from foreign countries. There were many things produced by foreign countries which we required, and which it would be absolute folly, by protective duties, to foster the manufacture of here. There was an import of manufactured goods, as far as he could ascertain, of from £60,000,000 to £70,000,000. He did not know whether the right hon. Gentleman the President of the Board of Trade agreed in that; but that was the figure, as far as he had been able to get it from Mr. Farrer's book.
MR. STAVELEY HILL
The right hon. Gentleman had knowledge on these matters; but he (Mr. Staveley Hill) had gone through the figures many times and put the amount higher. However, taking the amount at £35,000,000, a 10 per cent duty would yield £3,500,000. There were many things which might be done with the £3,500,000. There were taxes which might be made light, and which at present pressed heavily on the shoulders of people. The Chancellor of the Exchequer might deal with the great question of tea, and also with the question of beer; and not only that, but he could easily understand that the very placing of such a fiscal duty upon foreign countries, while it would not in any way be a protecting duty, or at all interfere with the importation of any manufactured goods from abroad, would act as a deterrent against the raising of Foreign Tariffs. It would not bring 1859 about a war, nor should we look to its bringing about a war of hostile Tariffs. He hoped he would not be regarded in what he was going to say as unduly pandering to working men. He was not one of those who wished to put the working man in any way above his fellows. As far as they were a numerous body, they were entitled to greater consideration than any other sot of men; but he was not one of those who would urge any argument in favour of the working man, simply because he happened to be one of a most numerous body. But this was a question essentially for working men, because an increased importation of manufactured goods affected the demand for work of the wage-earning class. Imports during the year 1880 had risen from £258,000,000 to £318,000,000, being an increase of £60,000,000, and the import of manufactured goods had increased £23,500,000. How did that affect the labour of the wage-earning class, because the proposition which he had before him was that the importation of manufactured goods increased the demand for labour of the wage-earning class? He took as an instance of that what took place in Germany during the Franco-German War. In 1870 there broke out that war of desolation—the Franco-German War—and during that war there were drawn from productive industry in Germany 1,250,000 men. Those were men who were absolutely engaged under arms; but when he added to them those persons who were not employed in productive labour, the total of the men withdrawn from productive industry was close upon 2,000,000. Before the war the excess of imports into Germany over exports was about £15,000,000, In 1876, when productive labour might be supposed to have returned to its ordinary channel, the excess of imports over exports was about £13,000,000. In five years, from 1871 to 1875 inclusive, we might take the total excess of manufactured goods imported into Germany over those exported at £115,000,000, and, dividing that by five, we got an average excess of 23,000,000 a-year. How was that paid for? France paid to Germany a War Indemnity of £200,000,000, and out of that was paid by Germany about £100 per man for two years to the 1,365,000 who were under arms. A portion of the £200,000,000 1860 was paid by France out of capital; but the remainder was paid in goods supplied to Germany. If we knew how that excess of imports diminished the employment of productive labour, we had gone far to show that the excess of imports from France lessened the demand for productive labour. He argued that, as an excess of unemployed labour led to an excess of imports, so was an abnormal excess of imports the measure of the unemployed labour in a country at a given time. If, during one of the years alluded to by the hon. Member for the Tower Hamlets (Mr. Ritchie), there was an excess of imported manufactured goods over exports to the extent of £24,000,000, the effect must have been that £18,000,000 were taken from the wage-earning class, if 75 per cent were understood to represent the labour upon manufactured goods. It was clear now that the French Treaty was unsatisfactory; it was not really based upon the principle of reciprocal advantage, as such Treaties ought to be, according to the dictum of Mr. Huskisson in 1830. He held that we should either become parties to a Treaty which was a fair bargain or have our hands untied. England, however, might with advantage enter into a Commercial Customs Union with her Colonies, which in a few years time would be able to supply the Mother Country with as much corn as she could wish for. Though he could not move the Amendment of which he had given Notice, he maintained in the terms which he had placed upon the Paper that, with a view to bring about a reduction of the heavy duties now levied in many foreign countries upon British products and manufactures, it was desirable that duties of a light character, amounting, say, to 10 per cent, should be levied upon manufactured goods imported from such foreign countries, provided that such duties did not interfere with the amount of food required by the people of this country.
§ SIR JOHN LUBBOCK
Sir, the hon. Gentleman the Member for the Tower Hamlets (Mr. Ritchie) proposes a Committee with so wide a reference and so vast a subject that, in fact, to go into the whole question not one, but half-a-dozen Committees, would be required. The Resolution as it stands would cover all fiscal enactments—not only our own, but those of all foreign 1861 nations—nay, it would include all measures bearing on commerce and manufactures—such, for instance, as the Mines Regulation, Factories, and other similar Bills. I cannot imagine that it could ever be wise to appoint a Committee with functions so indefinite; but even if some reasonable limitations were imposed on the scope of the inquiry, we ought to ask ourselves what ground there is for hope that such a Committee could lead to any good result. I do not, indeed, wonder that the hon. Member should propose such a Resolution. During the Recess we heard, over and over again, that Free Trade had failed, that Fair Trade was necessary for the interests of the country. These views were industriously circulated throughout the Provinces; and in agricultural districts hints were thrown about of a 5s. duty on corn, which was to bring in a considerable revenue, and raise the value of wheat, but not the price of bread. When Parliament met, the hon. Member for South Nottinghamshire (Mr. Storer), who accepted these statements in good faith, placed on the Notice Paper an elaborate Resolution, which set out all these arguments, and having secured the first place on a Tuesday evening, naturally expected that he would be supported by the right hon. Gentleman the Member for North Lincolnshire (Mr. J. Lowther) and his Friends. They were not, however, prepared in this House to defend the views advocated on Provincial platforms, or to recommend a 5s. duty on wheat. In hopes of encouraging them, the hon. Member for South Nottinghamshire, only the evening before his Resolution was to come on, threw overboard half of it; but, notwithstanding this concession on his part, his Friends could not be induced to face a discussion here. They left the House, and allowed it to be counted out. The country will draw its own conclusions. But it was necessary to do something, and the hon. Member for the Tower Hamlets (Mr. Ritchie) now comes forward with a Motion intended to cover the retreat of his hon. Friends. What can the hon. Member seriously expect from an inquiry so vaguely indicated and so unlimited in its scope? I fear, indeed, that to accept the Resolution would defeat the very object professed by the hon. Gentleman. It would be interpreted abroad to mean that our experience had created doubts 1862 after all, as to the wisdom of Free Trade; and it might, therefore, tend to weaken the Free Trade Party in foreign countries. The hon. Member confines his Motion to the duties imposed by foreign countries, and wishes, as I understand, to encourage our trade with our own Colonies rather than with foreign countries; but if we are to commence a war of Tariffs, we should be acting in the very opposite direction. According to Returns recently obtained by the noble Lord the Member for Liverpool (Viscount Sandon) and the hon. Gentleman the Member for the University of Oxford (Mr. J. G. Talbot), it would appear that, with the exception of Russia, most foreign countries have lowered their Tariff in the last 20 years. That is the case with Holland, Belgium, France, Denmark, Norway, Sweden, Italy, Austria, and Hungary. On the other hand, it is a melancholy fact that our own Colonies show a tendency towards Protection. The duties in Victoria, South Australia, Western Australia, New Zealand, Queensland, Canada, and the Cape of Good Hope are all higher than they were in I860. New South Wales and the West Indies are honourable exceptions; but the result is that in any system of differential duties the tendency would be to raise the taxation on imports from most of our own Colonies, and lower them on those from most foreign countries. It seems to be generally assumed that our trade suffers from the Protectionist policy of other countries. Speakers often say they are for Free Trade, but not for one-sided Free Trade. But how does this matter really stand? Suppose the simplest case—that all the world was Protectionist except ourselves. What would be the result? Every country would produce some commodity in excess of its requirements, which it would export. How is it to be paid? Our manufacturers, obtaining, as by the hypothesis they would, food, raw material, and semi-manufactured products duty free, would be placed at an overwhelming advantage as compared with other manufacturers; every other country would find they could purchase most satisfactorily in Great Britain; and our manufacturers would, therefore, gradually absorb the trade of the world. This is, in fact, what, to a certain extent, happens even now. I should like to ask the hon. Member dis- 1863 tinctly—What is the country with reference to which he would desire to raise our Tariff? It cannot be France, who has just passed a Bill to place us on the most favourable footing. I have shown that, unfortunately, our own Colonies—the countrymen of Cobden and Bright—are at present most behindhand in the science of political economy; but I presume the hon. Gentleman does not wish to interpose any artificial barriers between us and them. Probably he is thinking either of Russia or of the United States. But, as regards Russia, we import from that country no appreciable quantity of manufactured articles—less, I believe, than £250,000. She supplies us mainly with food and raw materials, which no one seriously proposes to tax. Moreover, the only effect of putting a differential duty on Russian produce would be that it would come round through Germany, and we should pay the railway fare. Let us, then, turn to the United States. I must say, in commencing, that I doubt if England would ever consent to impose differential duties as against any English-speaking race. For the moment, however, we will discuss the question purely on economical grounds. We export to the United States £38,000,000; while our imports of manufactured articles are less than £3,000,000, a large proportion of which consist of ingenious American devices. The importation of American manufactures, therefore, is so small, that it cannot have any appreciable effect on the gigantic proportions of our national commerce. But let us look into the matter a little further, and consider the effect of the American protective duties on her own interests. The United States produce great quantities of food and of cotton. These she exports. How is she to be paid? She does not require gold or silver, for her own mines supply her. She must, therefore, import manufactures. What, then, is the result of her protective duties? Who pays them? Our manufacturers, of course, send their goods to the best market. They will not sell them to the United States if they can get better prices elsewhere. The American consumer, therefore, pays in the price of the article not only the whole cost of the production, but also the so-called protective duties imposed by his own Government. The effect of those duties is to raise prices 1864 in the United States, to a certain extent to divert American capital from more profitable to less profitable employments, and to exclude American manufactures from the markets of the world. For, though the Protectionist policy of America does not, as a matter of fact, shut us out of her markets, it does exclude her manufactures from the markets of the world, because her manufacturers, having to pay so much more for their raw materials, are incapacitated from competing with ours. And what is true of the United States is true of other countries. They cannot and do not exclude our manufactures; but their protective duties, raising the price of raw materials, place their own manufacturers at a disadvantage as compared with ours, and shut them out from the markets of the world. It may be said that this is theoretical. Let us, then, contrast our figures with those of the United States—a country which has all the elements of prosperity, but which has, unfortunately for herself, adopted the Protectionist Tariff. The population of the United States is 50,000,000, while ours is only 35,000,000. But the American manufacturers, who are protected, only export £17,500,000; while our manufacturers, who are unprotected, export £191,000,000. If we take the whole exports from the United Kingdom and the United States, per head of the population, for the year 1840, they were—For the United Kingdom, £1 18s. 9d.; for the United States, £1 11s. 1d. Last year they were—For the United Kingdom, £6 9s. 5d.; for the United States, £ 3 8s. ld. Thus, while in the case of the United States they had risen £115s. per head, in the United Kingdom they had risen £4 10s. per head. If, on the other hand, we take the imports, the amount of foreign productions brought into the country to promote the comfort and well-being of our people, the amount per head last year was—For the United States, £2 13s. 3d.; for the United Kingdom no less than£11 18.s. 7d.But then our opponents say—" Oh; hut that is just what we complain of. We imported last year £411,000,000, and we only exported £286,000,000; we imported, therefore, £125,000,000 more than we exported; and if this goes on the country must be ruined." Why should it be ruined? It is estimated by the best authorities that we have to receive £75,000,000 a-year as interest 1865 on our foreign investments. Freight, commissions, and other items, make up, at least, £70,000,000 more; and, in fact, if it were not that we are continually investing capital in our Colonies and abroad, the difference between our imports and exports would certainly be even greater than it is. But the whole complaint is most extraordinary. We imported these goods because we wanted them. Nobody complains that we had too much foreign produce; but they lament that we did not pay enough for it. They complain that our exports were not larger; they would like us to have given more of our British manufactures, more coal and iron, and Manchester goods. If we had exported £100,000,000 more—that is to say, if the imports had cost us £100,000,000 more—I suppose they would have been satisfied. But who ever before heard of a great Party making it a serious complaint that we did not pay enough for what we consumed? Our exports are what we sell, and our imports are what we buy. If our Fair Traders would carry their principles into private life, and endeavour to enrich themselves by paying more for all they buy, they will probably see the singular error into which they are falling. They give to Canning's well-known lines quite a new application. We used to be told that—In matters of Commerce the fault of the Dutch,Was giving too little and asking too much.But our Fair Traders have entirely reversed this complaint. The fault, not only of the Dutch, but of all other nations, now is, according to the Fair Traders, that they give us too much of their produce in exchange for ours. If the £400,000,000 which we imported last year had cost us £100,000,000 more than it did, the hon. Member would, apparently, have been perfectly satisfied. The motto of the Fair Traders seems to be that the way to make money is to buy in a dear and sell in a cheap market, which will give you the great satisfaction of "increasing your exports." Was there ever in this world a more singular fallacy? I observed that the other day a noble Lord, arguing nominally for Fair Trade, drifted unconsciously into Protection, and frankly said that he thought almost every trade required protection. Well, if he went a little further and protected them all, 1866 he would see the absurdity of his proposal; for if everybody, by an elaborate machinery, is to pay for everybody else, surely it is better to let things take their natural course. The hon. Member for Preston (Mr. Ecroyd), in his article in The Nineteenth Century, argued in favour of cultivating our trade with the Colonies rather than with foreign countries, because, he said—In buying food from our Colonies we enjoy a return trade in our manufactures at least 20 times larger per head than with the Americans or Russians.But in such an argument there is a most singular confusion of ideas. When we import food, the "return trade," which, as he quaintly puts it, "we enjoy," is, in simple language, the price we pay for our provisions. I am not prepared to admit that for every quarter of wheat we import from a Colony we should export 20 times as great a value in manufactured articles as if we imported the same quantity of wheat from Russia; but suppose it was so, that is, after all, only to say that we should pay 20 times as dearly for it, which would surely be a singular advantage. Suppose foreign countries sent us food, and that we "enjoyed "no return trade, they would, in fact, be giving us the food for nothing. Germany, we know, has recently adopted, in some measure, the policy of hon. Gentlemen opposite. And what has been the result? Has trade improved? On the contrary, the Reports of the German Chambers of Commerce have recently been collected together, and the result is that they express an almost unanimous opinion that the New Tariff has proved injurious. I observe that the hon. Member for the Tower Hamlets (Mr. Ritchie) limits his Resolution to foreign countries, probably because, if he did not do so, his Amendment would give in practice differential duties in favour of foreign countries as against our Colonies. He limits his Amendment, therefore, to foreign countries. Then, again, I believe he would not tax food. Does he intend to levy duties on raw materials? To tax raw materials would certainly be no been to our manufacturers. But if they are also to be excluded, what remains? Out of a total importation of £411,000,000 there are only £35,000,000 of manufactured articles retained for our own use. Moreover, this comparatively small sum is 1867 divided among so many countries, that there is no one on which we could exercise any effective coercion by imposing a duty on manufactures, even if we were disposed to do so. That any such attempt, however, would be most dangerous and even suicidal is, I think, conclusively shown by the fact that while our whole import of foreign manufactures is only £35,000,000, our export of manufactures is £190,000,000, of which nearly £95,000,000 is to countries with Protectionist Tariffs. To engage in a war of Tariffs under such circumstances would be dangerous indeed. But what is really the state of our commerce? "What has been the course of our export trade of British products? It had gradually increased, until, in 1873, it amounted to £255,000,000. But in 1874 there was a change of Ministry. From that time we were disturbed by wars and rumours of wars. Whether right hon. Gentlemen opposite were to blame for this, or whether, as they of course maintain, these alarms were not due to any fault of theirs, is not the question now before the House. Unquestionably, however, the uncertainty thus created affected our trade most prejudicially. From £255,000,000 in 1873, it fell to £240,000,000 in 1874, £223,000,000 in 1875, £200,000,000 in 1876, £198,000,000 in 1877, £192,000,000 in 1878, and £191,000,000 in 1879. Last year, happily, it rose again to £223,000,000. Nay, if the exports of last year were estimated at previous prices, the total would, perhaps, exceed that of any former year. Sir, the immense increase in our commerce since we adopted Free Trade is patent to everyone. To a certain extent, no doubt, that increase is due to the increase in population, the improvement of machinery, the use of steam, and the improved means of locomotion—in fact, to the applications of practical science. But those advantages foreign nations share with us. Now, if we contrast our foreign trade under the system of Free Trade with that of the principal countries of the world which have that system of restricted imports to which the hon. Member wishes us to revert, what do we find? Russia, with a population of 86,000,000, has a foreign trade of £183,000,000; the United States, with a population of 50,000,000, has a foreign trade of £290,000,000; Germany, with a population of 44,000,000, 1868 has a foreign trade of £350,000,000; Austria, with a population of 38,000,000, has a foreign trade of £128,000,000; France, with a population of 37,000,000, has a foreign trade of £340,000,000; while Great Britain, with a population of only 35,000,000, has a foreign trade of £700,000,000. I do not deny that some great interests are suffering. It is, unfortunately, too clear that farmers especially have lost heavily from bad harvests during the last five years. But, Sir, what is, on the whole, the condition of the country at the present time? In spite of the bad harvests, in spite of our enormous National Expenditure, which I am sure no one regrets more than the Prime Minister, we are making money and saving money. No doubt there have been more prosperous times; but yet every indication shows that the country is increasing in wealth. The total annual value in property assessed for the Income Tax in 1870 was £445,000,000; in 1879 it was £578,000,000: during the last 10 years we have laid out over £100,000,000 in railways in Great Britain and Ireland; our shipping has increased from 5,700,000 to 6,700,000 tons; and it is surely a proud boast that more than half the shipping on the high seas carries the Queen's flag! The total of coal and metals produced in 1870 was £46,000,000; in 1880 was £64,000,000. The Clearing House transactions in 1870 were £3,900.000,000; in 1880, £5. 718,000,000; and' this year, I believe, will show an increase of no less than £ 500,000,000. The numbers of cotton piece goods exported in 1870 were 3,250,000; in 1880, 4,500,000. We have heard a good deal about the wool trade; but the amount of raw wool used was, in 1870, 323,000,000 lbs.; in 1880, 370,000,000 lbs. The deposits in savings banks have increased from £35,000,000 to £77,000,000. The number of able bodied paupers in 1849 was 200,000; in 1880 it had fallen to 110,000, although, the population had increased more than 30 per cent. The improved scale of comfort of our people is shown by the increased consumption per head of such, articles as tea and sugar, butter and cheese. Lastly, I think every banker will confirm me when I say that our investments in foreign securities are increasing every day. I do not deny that some trades are suffering; but, on the whole, whatever test you take, all tend 1869 to show that the wealth and prosperity of the country, as a whole, is increasing. Moreover, it must be remembered that this general improvement is the more significant and remarkable when we reflect that it has taken place in spite of a succession of bad harvests. If it can be proved to demonstration, as I think it can, that, on the whole, the country is richer than it was 10 years ago; and if it is admitted that, unfortunately, our harvests have been disastrous, it follows, of course, that our commerce and manufactures must have prospered. I do not say that that prosperity is wholly due to Free Trade; but that Free Trade has largely promoted it I firmly believe. When foreign nations endeavour to exclude us from their markets, they shut themselves out from the markets of the world—nay, rather, as experience shows, their so-called system of Protection, while it cannot keep us out, shuts them in. So long as there are no differential duties against us; so, long as each foreign nation admits our goods on as favourable terms as those of other countries, I doubt not that our manufacturers will be able to hold their own. The "Most Favoured Nation" Clause is, therefore, what I think we should contend for. In conclusion I trust that this House will give no support to any Motion which would in any way tend to imperil that wise system of Free Trade, under which our manufactures and commerce have attained to a magnitude and prosperity unparalleled and unexampled in the history of the world.
§ MR. ECROYD
said, that, if he were disposed to go into the question, he could bring clear proof to show that, if a marked fall in the manufacturing industries of the country had taken place while the Conservatives were in power, a recovery in manufacturing industries took place many months before the fall of the Government of Lord Beaconsfield. But such considerations were really beside the question now before the House. He proposed to deal with the hon. Baronet's argument, and to examine the effect of Foreign Tariffs on trade, and then to go on to see what could be done in the way of legislation for the promotion of the trade and industries of the nation. They had just witnessed the failure of the attempt to negotiate a Treaty with France. That was a matter for surprise, for one would have thought 1870 that the 20 years' experience that France had enjoyed in connection with this country would have induced her to adopt Free Trade, and to become the precursor of that policy throughout Europe. He had felt the most complete confidence in the efforts the Government had made to negotiate a new Treaty of Commerce, and in the ability of the hon. Baronet the Under Secretary of State for Foreign Affairs, who had acted on behalf of the Government in the negotiations; and those negotiations had only failed because France had determined to have a retrograde Treaty or none at all, and to fall back again upon that policy which the Emperor Napoleon was induced, by the arguments of Mr. Cobden, to abandon some 20 years ago. The hon. Baronet had challenged them to state some definite policy. He accepted that challenge, and would, in the fewest possible words, state what was the policy they believed should be adopted by this country. In the first place, they had to consider whether the present state of things was not due to the action of Foreign Tariffs. He would, therefore, proceed to deal with the question of productive industries. He believed those who said that the manufacturing classes were much more prosperous than they were 20 years ago. That was the opinion of experienced men of business. The statistics, in many cases, were completely irrelevant to the issues raised in the present debate. Statistics told them what the amount of the trade of the country was; but they did not state what would be the effect of assisting the development of the resources of the country. Again, with regard to the improvement that had shown itself in our foreign investments, it was impossible to say whether we were not thereby losing some of the resources of the country. We were absolutely without any information which would enable us to arrive at any safe conclusion upon that important element. Again, upon the question of paupers, in spite of the long period of depression of trade, only a comparatively small number of the population were thrown on parish relief. During the prosperity of the last 20 or 30 years, for which he would give credit to the Free Trade policy of the country, he and others who were engaged in manufacturing industries in the North were well aware that a considerable 1871 change had taken place an the condition of the manufacturing population, and that they were now able to bear a considerable amount of depression without being driven to seek parish relief. When depression took place, they first of all had recourse to their previous savings; then they took to restricting their expenditure; then, he was sorry to say, they gradually parted with their stock of furniture; and then, finally, they had to get into debt to obtain the necessaries of life. He could speak from his own personal experience of the honourable manner in which the people faced their difficulties. Not many years ago, when, in consequence of the depression in trade, he and those who were connected with him had to restrict production, they made advances to their workpeople without any security, in order to enable them to tide over their difficulties; and they were afterwards repaid without the loss of a single farthing. Taking that case as an example, we should look in vain to the statistics of pauperism to ascertain the losses suffered by the productive industries of the country. Then, as to the Income Tax, would anyone be found to assert that the landowners were not paying much more Income Tax on the same income than formerly? Had they had an allowance made to them of Income Tax anything like in proportion to the losses they had sustained? We knew they had had nothing of the kind. As regarded Schedule B, a large number of the farmers, no doubt, made accurate returns; but in many cases the return was made at random, and they were satisfied if the Commissioners reasonably assessed the Income Tax to be paid. He was satisfied that those returns did not present a safe foundation for drawing conclusions as to the losses sustained by productive industries. With reference to the effects of the Tariffs, the alterations in the Foreign Tariffs afforded no guide as to their effect in restricting British exports. The duty of 10 per cent levied on our manufactures had no restrictive effect on the trade of the English manufacturer; but the longer it was maintained the greater effect it would have, until ultimately English goods would be kept out; so that the 10 per cent, which was now comparatively harmless, became, in the course of time, absolutely prohibitive. The Foreign Tariff injured us by 1872 limiting our productive industries. The hon. Baronet the Member for the University of London (Sir John Lubbock), who preceded him, had stated that we obtained imports in exchange for exports. There could be no doubt as to that; but they said that the productive industries depended in great measure on the ability to purchase imports; and, therefore, by placing restrictions on the productive industries, and crippling the manufactures, a distinct injury was done to the trade and prosperity of the country. Hon. Members, if they would refer to the Commercial Blue Book, No. 38, page 72, would find a letter from Mr. Kersham, the President of the Luton Chamber of Commerce, with regard to the French Tariffs. He said there that the proposed duty would entirely prohibit the exportation of straw hats; and he further remarked that as a large quantity of those goods would be exported to France when there was no demand for them, he earnestly desired that they would urge on the French Government the importance of re-considering the matter. On page 113 of the same Blue Book the President of the Central Chamber of Agriculture, speaking of the duties on woollen goods, said that it was a matter which concerned the agriculturist as well as the manufacturer. The injury to agriculture was of a secondary nature; but it was distinctly felt, nevertheless. A reference had been made to the disastrous influence on the Bradford trade by the increase in the German Tariff. There could be no doubt that that was partly the cause of the falling-off in that trade, and that it was not wholly due to the change in fashion to soft goods, which, required Colonial wools for their manufacture. Another influence of the Foreign. Tariffs was the exaggerated fluctuations of demand. In the coal and iron trades, for instance, that was seen, especially as regarded the demand from America. The effect of the overflow of the American demand was that it unduly stimulated the labour of those industries in this country. The moment that demand failed, the American workmen would still be employed, owing to the Protective Tariff which existed there; while our workmen would cease to be employed, and the ultimate effects must therefore be disastrous to our trade. Another effect of these exaggerated demands was 1873 that on the moral condition of the population. The moment the demand ceased a depression followed, and the avoidance of such unhealthy fluctuations as that could hardly be bought too dear at any price. In a pamphlet which had been published recently by Mr. Farrer, that gentleman reminded the Protectionists that the cheapness of goods was owing to foreign competition. They had often been accused of being Protectionists, and had been called by that name. An endeavour had been made to prove that he and his Friends had complained of foreign competition. He had never done so. Mr. Farrer had made that assertion, and, as evidence, had quoted an article in The Nineteenth Century, which really proved the reverse. He had not complained of foreign competition, but of Foreign Tariffs, and had said that we ought to free ourselves from the effect of Foreign Tariffs. Mr. Farrer had absolutely misquoted him, and imputed to him opinions the very contrary of those which he entertained. If an opponent had recourse to such methods, he must be reduced to desperate straits indeed. Those Foreign Tariffs had caused a lamentable deterioration in our fabrics. In the same Blue Book, on page 59, would be found the evidence of Mr. John Merry, the President of the South of Scotland Chamber of Commerce, and which was to the effect that the prohibitive duties charged by foreign countries compelled the production of an inferior article. Ten per cent had to be taken off the cost of production, representing 5 per cent in inferiority of quality, and 5 per cent in reduction of wages. Wages had been reduced to the lowest possible rate consistent with the maintenance of the workman. He had found the necessity of manufacturing meretricious articles had told especially on our trade with Spain. The same effect had been produced in English plate-glass exported to France. The result was that the French consumers had to pay 20 per cent for English plate-glass above its natural price if there were no duties. Another consequence naturally was to encourage the production of an inferior kind of article. Thus, too, the French producer was enabled to pour his goods into this country without limit. He was not then discussing the effect upon the English consumers, who, it would be said, profited by this influx 1874 of foreign goods. Thus, an unfair and illegitimate competition was created, very detrimental to English industries. In periods of great prosperity the restraint thus put on our commerce with certain countries was but little felt, as the general trade of the country, spread over a wide area, tended to obscure the hardships in our trade with particular countries. He would compare our export and import trades in two series of years. In the years 1871, 1872, 1873, and 1874, which were exceptionally prosperous, the imports in meat, dairy produce, grain, and potatoes amounted to £305,500,000. In 1877, 1878, 1879, and 1880, the imports in the same articles amounted to £417,750,000, showing an increase of £112,000,000 in our imports of agricultural produce. He would next give the total exports abroad of our five leading industries—namely, metals, textiles, chemicals, railway carriages, &c, earthenware, china, and glass. Our total exports of these great products of our manufacturing industries in the first series of years, 1871, 1872, 1873, and 1874, amounted to £789,000,000. In the second series of years, 1877, 1878, 1879, and 1880, they amounted to £627,000,000. Thus the falling-off in the exports of these great products was £162,000,000 simultaneously with an increased import of agricultural produce to the extent of £112,000,000. He had always admitted that the income due to us from foreign investments and amounts earned on freights, and the profits on our foreign commerce, were all legitimate reasons why we should import a great deal more in value than we exported. It was not, however, that fact which we were now dealing with; but with the fact that in four years of disaster, when every source of our foreign income which ought to account for excess of imports had failed in an extraordinary manner, the excess of imports over exports was £284,000,000 more than the same excess had been in the four profitable years. It was quite clear that here was a phenomenon which required the most attentive consideration. It might be said, no doubt with truth, that the change in the amount of our foreign investments had much to do with, this phenomenon; but no more damaging admission could be made by hon. Gentlemen on the other side of the House. The right hon. Gentleman the 1875 First Lord of the Treasury made two remarkable speeches at Leeds on the 7th and 8th of October last; and, in regard to this particular question, the right hon. Gentleman spoke of the great falling-off in the export of our industries during this period of depression to which he had just been alluding. It was estimated by the right hon. Gentleman that in 1877, 1878, 1879, and 1880, the falling off was £161,000,000. The right hon. Gentleman went on to analyze the effect of that falling-off in our exports upon the condition of the country; and he estimated the loss of profit at £16,000,000, or 10 per cent, and the loss of trade at £8,000,000, making a total loss of £ 24,000,000. But he must point out that, in his argument, the right hon. Gentleman failed to notice the enormous loss sustained by the cessation of wages and rent and interest and capital upon buildings, and the expensive machinery employed, which must in many cases have amounted not to 10 per cent, but to 50, or 60, or 70 per cent. Many of our mechanical industries, and the coalmining industries, were reduced to half work. At all events, this was the case in many districts. In South Wales the result was much worse than this, and the production of iron was actually brought to a standstill. This diminution of the national earnings, he might observe, could never afterwards be regained. If foreign nations would have accepted our goods on equitable terms, those industries would still have been employed. But for the alteration of the American Tariff, the Americans would, in exchange for the food they imported, have taken a large quantity of the manufactures and products of this country. Here we put our finger on the exact manner in which Foreign Tariffs diminished the resources of the country and injured its industries. Our loss from the failure of agricultural produce on occasions like this was aggravated by the artificial stoppage of our manufacturing industries. It was an unfortunate fact, which added seriously to the difficulty calling for solution, that not only were we liable to recurring depressions of trade, but agricultural employment was also being contracted, and land was being changed from arable to pasture, or it was allowed to remain fallow. Every thousand acres so changed displaced 28 families of agricultural labourers, and thus diminished 1876 the wages earned. Therefore, we had not only contraction of our manufacturing industries, and of the employment they afforded, but we had a serious diminution in agricultural employment, which was throwing the agricultural population more and more on the large towns, bringing them into competition with those employed in manufacture. In the last 10 or 15 years there had been a great reduction in the value of mill property and industrial works. The diminution of income sustained by the landed interest through the competition of American corn was a very serious injury to the nation at large, because it contracted the expenditure of an important class, and was felt through every branch of trade and commerce. These things told first of all on trade capital, which gradually melted away. As to the partial recovery of trade during the last two years, for the first time in the experience of living men a recovery of trade which brought employment to the working classes had been unaccompanied by a profit to the employers, such as would strengthen them and enable them to bear occasional pressure. The effects of these things were felt in the depreciation of the value, not only of mills and warehouses, but also of houses and shops in centres of industry. These were certainly indications of the decay of national resources and prosperity. It was, therefore, not surprising that there was a cry for Protection, not only from manufacturing communities and bodies of workmen, but also, and especially, from those engaged in the cultivation of the soil. With Protection he had not the smallest sympathy. He did not believe that the protection of any industry in this country could be of the slightest eventual benefit to that industry, while he held that it must be a disadvantage to the country at large. He had heard Protection demanded by staunch Liberals, and large numbers of Liberal working men and tradesmen held Fair Trade principles strongly. He was not surprised at the demands coming from these quarters. The production of wheat had been considered for generations by owners, occupiers, and labourers to be a safe and firm industry. But if any proposal were made for direct Protection, such as a 4s. or 5s. duty on imported corn, he should be obliged to 1877 vote against it. He was sure it was not Protection that could meet such a state of things. Still, we could not silence those who made the demand, nor suppress the conviction that the prosperity of the country was seriously imperilled. We could not get rid of the impression that it was much more risky than it used to be to put capital into our leading industries. We could not scold complainants into silence by telling them there was nothing the matter with them, nor re-assure them by the conclusions which Mr. Giffen drew from the Trade Returns. It might be that those with large foreign investments were saving money, that others were making large profits on our imports, and yet that there was a rapid diminution in the wealth of the owners of fixed property in this country. It seemed to him most unfair to charge those who proposed to put a duty on foreign manufactures only for the purpose of putting pressure on those who excluded our own with entertaining a desire for Protection. Nothing could be more legitimate than to impose a duty of 10 per cent, at the same time giving notice that it would be abolished in the case of those countries that admitted our goods. It would be an absolute offer of Free Trade in manufactures. Of course, by such a proposal we could not act on the United States or Russia; but it was good in its own limited area—as, for instance, between us and Belgium or France, whose manufactures we received, while they refused to receive ours on equal terms. No doubt it was more difficult to deal with the United States and Russia, from which we received large supplies of food and raw materials. He was not one of the Council of the National Fair Trade League, nor was he responsible for their programme; but he believed that all Commercial Treaties with foreign countries or our own Colonies should absolutely cease and never be renewed. But that would not preclude arrangements for the protection of mutual interests by Conventions. We ought to abandon all attempts to make any tariff bargains with any foreign country, colony, or dependency. We ought to impose a duty upon articles of food imported from foreign countries, perfectly uniform in character, not for the purpose of Retaliation or Protection, but simply to control the future course of our capital, and develop the resources 1878 of the Empire. In one of his speeches at Leeds the Prime Minister had spoken of the possibility of America prospering under a system of Protection. For his own part, he believed that Protection was always hostile to the interests of the country that adopted it; but the right hon. Gentleman had said that America was capable of flourishing under such conditions, because she had an incomparable field of commerce and exchange within her own limits. That was to a great extent true, and British statesmen would find that the greatest mistake they could commit was to withdraw all commercial preference from the component parts of our own Empire. It was much to be regretted that our Empire had not been so drawn together as to make all our great Colonies members of its free exchange, just as California and Texas, Minnesota and Florida, Pennsylvania and New England all shared the general commercial policy of the United States. The consolidation of the United States had been maintained 20 years ago by a fearful Civil War; but the unity of the interests that, after all, kept the States together was owing to the fact that the country could, to a great extent, subsist on its own internal commerce; and the same bond of commerce might easily be made to unite the parts of our own Empire. The greatest sacrifice we had ever been called upon to make was a very small one, and was merely the imposition of a trifling duty on foreign food, in order to drive the industry of producing it into the hands of our Colonial fellow-countrymen. It would be said, however, that our Colonies were more Protectionist even than foreign countries, and that we had no control over them. True, many of them had adopted a protective policy; but they had been thrown into the arms of Protection by the system adopted by the Mother Country, which would have the result, if it were persisted in, of forcing Canada into a Tariff like that of the United States. Had a different policy been adopted, and had the tie that bound the Colonies to the Mother Country been more satisfactorily recognized, there would have been little or no difficulty in maintaining the complete freedom of Colonial exchange and commerce. By the word "freedom" he did not mean that the Colonies would never have imposed revenue duties, but that 1879 such heavy duties would not have been levied as other countries—the United States, for example—placed upon the productions of this country. The comparative value to England of the foreign and the Colonial trade was shown by the following figures:—During the five years 1876 to 1880, inclusive, the United States, with 50,000,000 of people, had taken from us British manufactured goods to the value of 7s. 11d. per head of the population; Australia, with 3,000,000 of people, took goods to the value of £5 19s. 7d. per head; Canada and Newfoundland, with 4,000,000 of people, to the value of £1 12s. 6d. per head; Russia, with 80,000,000, to the value of 11s. 6d. per head; the West Indies, with a population of 1,330,000, to the value of £2 1s. 3d. per head; and the Cape Colony and Natal, with a population of 1,085,000, to the value of £ 4 19s. 7d. per head. That showed that we ought not to look merely to the absence of Free Trade, but also to the practical effect of the duties levied by our Colonies on our manufactures, as compared with the duties levied by countries like the United States; and that, instead of enforcing on our Colonies the abandonment of all duties, we ought to encourage them to find in their union with the Mother Country a continual advantage from the enjoyment of a comparatively free exchange, which should bind them for ever to this country. With those views he had never advocated the policy of dragging the Colonies into Free Trade, and had never held that it was our duty to make trade conventions with them. If that had been the commercial policy of the country, one of its earliest results would have been seen in the case of Canada. For 14 or 15 years Canada, living near a great Protectionist neighbour, had had the greatest difficulties to contend with. She had been imposing duties of 20 percent on our manufactures, while the United States had been imposing 60 per cent on the same manufactures. The immediate consequence had been that if he sent £100 worth of goods to the United States of America, the duty of 60 per cent levied on them raised the price of them for internal circulation to £160; while, if he sent an equal £100 worth of goods to Canada, the duty of 20 per cent would raise the price for internal circulation in that country to 1880 £120. The effect of that was to raise the rate of wages relatively to the United States as compared with Canada, and also to raise the inducements for embarking capital in the United States as compared with Canada, depriving the latter of the advantage to which, as a child of this Empire, she was entitled. He believed that it was in order to draw capital and enterprize back to their proper channel that Canada had felt herself compelled to adopt the policy she had entered upon; and he had no doubt that the adoption of such a policy as he had described was the only course that could prevent the relative decay of our Colonies as compared with the progress of nations like the United States. There were two alternatives open to a people in the position occupied by the Canadians—either to approximate their Tariff to that of the United States and to seek a commercial union with them on a protective basis, or to seek from the Mother Country such a preference for their productions as would give proper inducements for capital and enterprize within our own Empire. We were driving Canada and our other Colonies into the worst of those alternatives; and we must not, therefore, be surprised if Canada, Victoria, and our other leading Colonies had adopted a policy which we greatly regretted. He apologized for detaining the House so long; but he had been associated with that movement, and he was expected to declare his convictions in regard to it frankly in that House as elsewhere. He entirely repudiated the charge which he much regretted that the Prime Minister had brought against him and other Gentlemen holding similar opinions, that they had said one thing in the manufacturing districts and another thing in the agricultural districts. From the first moment when the convictions that he entertained found a place in his mind he had frankly declared them on all occasions. He had declared them, in the first place, to great bodies of working men in his native county of Lancashire. He had not scrupled from the first to tell them he believed that a small duty upon foreign food was the only remedy for the ills they had to meet; and he had never addressed an important meeting—and in Lancashire he had addressed many—of working men who had not been completely and enthusiastically in 1881 favour of that policy. ["Oh!"] He should be delighted to meet any hon. Gentleman who thought that was an over-statement on any platform he chose in any town in Lancashire. It was said that movement was a spasmodic one, and that it was waning. It had, on the contrary, been growing for four, five, or six years past. It was never growing more surely and steadily than at this moment. They had sought quietly and patiently, and by legitimate means, to make their opinions known, and to advocate the policy which they believed would be for the advantage of all classes of the community. The thought that there had been something spasmodic in the movement on that matter might possibly be attributed to events which took place last year, and which were supposed to be the outcome of that movement. He said that the circumstances of his own election—and he thought it had been proved since in the election of his right hon. Colleague (Mr. Raikes)—had nothing to do with the Fair Trade question. The discussion of that question had been forced upon him in that contest. He had taken up the challenge gladly; and the people certainly gave an unmistakable answer. But they would, he believed, have given the same answer if the Fair Trade controversy had never entered into the matter. In other parts of the country there were evidences of the continual spread of those principles. He received the other day a report of the proceedings of a debating society at Dumfries. That society consisted of intelligent men belonging to both political Parties in the place. During last summer the question of Fair Trade was discussed in that society, when only 24 members recorded their votes in its favour. The same question was debated a week or two ago, and it was carried by 97 to 82. He could mention a number of facts of a similar character. Whatever hon. Gentlemen opposite might think, they would have to lay their account with the fact that that movement had firmly rooted itself in the minds of large masses of the people; that it was spreading, and would continue to spread; that there was only one circumstance that would deliver them from having to meet it and make terms with it, and that was the possibility that foreign nations might completely reverse their policy; that 1882 those things long ago predicted by hon. Gentlemen opposite should begin to show some signs of fulfilment, and that foreign nations should distinctly commence to reduce the duties they imposed upon our productions, and thus relieve our workmen and their employers from those fears and anxieties in regard to the fate of their industries which had created the movement of which he had been speaking.
§ MR. CHAMBERLAIN
I do not complain, Sir, of the length of the speech of the hon. Member for Preston (Mr. Ecroyd). On the contrary, as the head of an organization which has had this subject under consideration, the hon. Member's right to lay his views fully before the House must be admitted. I will say, further, that the fuller the hon. Member stated his views and the plainer the exposition of his principles, the better it is for those who have to meet him in fair discussion. I am grateful, among other things, to the hon. Member for the light which he has thrown upon what I must call the question of definition. The House has learnt from the hon. Member that the question whether a man is a Protectionist or not depends entirely upon his motive at the time. It is not a question of fact; but it is a question of intention; and if a man comes to this House and proposes to levy a 5s. duty on corn to protect the farmer, he would be a Protectionist; but if another man comes down and proposes to lay the same duty on foreign corn, and said, in the words of the hon. Member, that he did it "quietly and peacefully, in order to determine the flow of capital and labour by driving industry to the Colonies," and although the same results may follow, although the action is similar and the conditions are identical, in the one case it is to be called "Protection," while in the other the name of "Protection" is to be indignantly repudiated. That seems to be a question beyond ordinary comprehension. It is a problem in casuistry rather than a question of practical politics. The hon. Member for the Tower Hamlets (Mr. Ritchie), with his usual skill, has devised a Resolution so vague and indefinite, that it has caught very large fish indeed; and it has obtained the support of several hon. Gentlemen who profess opposite and inconsistent opinions. I have heard that the right 1883 hon. Baronet the Leader of the Opposition and other right hon. Gentlemen have promised their support to this Resolution. I admit that a Resolution for a Committee of Inquiry is always a specious proposal; but I shall state the objections to it in the words of the Leader of the Opposition himself. Two years ago—on the 13th of February, 1880—when the right hon. Baronet was the Leader of the House, there was a debate upon a Resolution proposed by Mr. Wheelhouse, then one of the Members for Leeds, almost identical in terms with the Resolution now under consideration; and to that Resolution, two years ago, the right hon. Baronet gave a most determined opposition. The right hon. Baronet said—I wish distinctly to say, on the part of the Government, that they, of course, recognize the importance of the question; but, on the other hand, they think it would be wrong, by any doubtful proceeding, especially if countenanced by them, to raise a false idea, or to produce a wrong impression as to their commercial policy. …The appointment of such a Committee would seem to imply a change of opinion on the part of the Government which I think would be injurious."—[3 Hansard, ccl. 619.]Now, if the right hon. Baronet is going to speak this evening, I hope he will inform the House what has happened since 1880 which makes him ready to countenance this doubtful, proceeding, which, two years ago, he thought would be injurious? An inquiry of the kind proposed would be necessarily one-sided and incomplete; and I think, before it is granted, we ought to know what is the object which the promoters have in view, and to what change in the fiscal conditions they expect this inquiry to lead. I find among those who support the Motion the greatest possible divergence of opinion. It appears, if the inquiry is to be an efficient inquiry, we must go into Foreign Tariffs, in order to found thereupon some alteration in our own Tariff. But, then, what alteration? The hon. Gentleman the Member for the Tower Hamlets (Mr. Ritchie) tells us he is opposed to anything in the nature of Protection. Every hon. Member opposite said so. [Mr. NEWDEGATE: NO.] I am glad to see the hon. Member for North Warwickshire (Mr. Newdegate) in his place. If he had spoken he would have called things by their right names. The hon. Member for Preston (Mr. Ecroyd) proposes to go much further than 1884 the hon. Member for the Tower Hamlets (Mr. Ritchie). He wishes for this inquiry in order to show the necessity for levying a moderate duty of 10 percent on manufactures and on food. The hon. and learned Member for West Staffordshire (Mr. Staveley Hill), on the other hand, wishes to levy a duty upon raw materials and manufactures; but he expressly excludes food, which the hon. Member for Preston (Mr. Ecroyd) proposes to tax. They have thus entirely inconsistent proposals, which, however, amount to a practical reversal of the policy of this country for 40 years past, and a return to the policy of Protection. We have been told, both by the hon. Member for the Tower Hamlets (Mr. Ritchie) and by the hon. Member for Preston (Mr. Ecroyd), that their proposals are only for temporary change, and that they anticipate, as the result, that foreign nations will be brought to their senses, and that the duties they now put on will be removed.
§ MR. CHAMBERLAIN
The hon. and learned Member for West Staffordshire (Mr. Staveley Hill), at all events, stated most distinctly that his proposal was only to levy these taxes as a matter of temporary emergency, and until other nations had been brought to their senses. I wish to point out that it was upon similar promises that the Protective Tariff of the United States was introduced. It was to be a temporary measure, and was to stimulate the infant industries of the country. But, although those industries have grown to manhood and have been sufficiently stimulated, we do not find the duties removed. On the contrary, they have gone on from bad to worse, increasing the duties from year to year; and the artificially-created industries have become such a power in the State that it has been found almost impossible to deal with them. I should like to carry my reference to the United States a little further. The United States is, undoubtedly, the worst case of a hostile Tariff with which we have to deal, and I would test the case now made for an inquiry by reference to it. What kind of information should we be able to obtain, and what advantage would the inquiry give us? I think it would be found that the facts of the case are 1885 already within our knowledge, and that it is only the arguments which are the subjects of discussion. The first fact that would be brought out in the inquiry would be that 90 per cent of the United States exports are food and raw materials, which are not the subject of prohibitive Tariffs at all. It follows from that, and is consequent upon it, that the foreign trade in manufactures has been practically annihilated; and the competition of American manufacturers in neutral markets is practically nothing at all. Let us consider the case of the special industries to which reference has been made. In the case of cotton the raw material is extremely bulky and costly in transit, and the Americans have the raw material. In spite of that, and of the ingenuity of the population, which ought to enable them to compete with any foreign country, not only in their own supply, but in the supply of the neutral markets, and in spite of their imposing duties of from 30 to 60 per cent, their total export of cotton manufactures is less than £2,000,000 sterling. Yet, not withstanding what is called our one Sided Free Trade, this country exports £70,000,000 sterling, of which £3,500,000 go to the United States, while they send us only £751,000. Then, in the case of wool, America has not the same advantages that she has in respect to cotton; but she is, at least, on an equal footing. The woollen industries have been specially protected by duties of from 40 to 100 per cent. What has been the result? The total export of woollen manufactures from the United States is £45,000, while that from the United Kingdom is £20,000,000, and that at a time of great depression. What is still more striking is this—that the very industry which is specially protected by enormous duties should only export £45,000 worth of goods in the year, while the woollen imports into the United States from different countries during the year amounted to £11,000,000 sterling. In the case of iron and steel manufactures the duties vary from 40 to 60 per cent. The American export of these manufactures of all kinds is still less than £3,000,000 sterling, while this country exports nearly £30,000,000 sterling, of which £10,000,000 are sent to the United States. We find, therefore, in the case of the protected industries, that protection is accompanied by an entire absence 1886 of anything like an important foreign trade. On the other hand, the free industries of this Kingdom find their prosperity largely in their enormous exports. But I think a more startling illustration of the effect of a Tariff is to be found in the influence of the protective duties of the United States, not on the interests specially protected, but on the connected industries. I have one or two illustrations which I will venture to read to the House; although I am afraid of troubling them too long. The first case is the case of the boot and shoe trade of the United States. The boot and shoe trade is not, I am informed, a largely protected interest; but a heavy duty of from 15 to 25 per cent, has been placed upon leather. The effect upon the connected boot and shoe industry has been that the export has fallen from $1,329,000 in 1863 to 8475,000 in 1869, and it has never increased since. On the other hand, in the United Kingdom, I find that the export of boots and shoes has risen from £1,406,000 in 1860 to £1,447,000 in 1870, and that sum has increased to £1,656,000 in 1880. Well, but the most striking case of all is an illustration which has already been referred to by my lion. Friend the Member for Oxford shire (Mr. Cartwright)—the case of the shipping trade of the United States. It is a case which is in everybody's mind, and the facts are so remarkable that I will venture to quote them to the House. So long as ships were built almost exclusively of wood, the shipping trade of the United States progressed in even a more rapid ratio than that of the United Kingdom. The United States, having an enormous seaboard and an active, courageous population, there was nothing to prevent them from being the greatest carrying nation in the world, except their protective system. On iron and every article that entered into the construction of a ship, and upon the ship itself, there is a duty so onerous that the carrying trade of the world has passed away from America and has come to this country. The figures are as follows:—In the first place, I find the value of exports and imports carried in American vessels—I am dealing with the American trade, and not the general trade—fell from $344,000,000 in 1871 to $273,000,000 in 1880—that is to say, there was a fall of—71,000,000 in nine 1887 years. At the same time, the amount carried in foreign bottoms rose from $739,000,000 to $1,298,000,000, or an increase of $559,000,000. I find, also, that the building of American shipping, which was 272,000 tons annually in 1850, had remained stationary in 1870, and was still only 276,000 tons; while in 1880, 10 years later, it had fallen to 157,000 tons. At the same time, the annual tonnage building of English shipping has increased from 226,000 to 473,000—that is to say, the tonnage of English shipping built annually has more than doubled in the time during which the tonnage of shipping built in America has been diminished by nearly one-half. Well, I believe that the Americans are beginning to see—although at present perhaps slowly, and perhaps dimly—the effect of this foolish policy upon their own prosperity. My attention was called the other day to a speech delivered in the United States Senate by Senator Coke, of Texas, which shows that some, at all events, of the Representatives of the people are fully aware of the injury done by this protective policy. He said—The commerce of no country in the world is so hampered, so shackled, so obstructed by legislation in the interest of the few to the injury of the mass, as in this boasted land of equal rights. … The Tariff under which, for 20 years past, we have lived is the most monstrous system of taxation in its burdens upon the great body of the people, and its bounties to a small percentage of the whole, that this country, in all its history, and, I believe I may add, any other country, has ever known.What is the conclusion to be drawn from the facts that I have laid before you? I do not like to speak dogmatically on matters of this sort, because there are so many considerations that one would be afraid to arrive at too hasty a conclusion. But it certainly appears to me that what hon. Gentlemen opposite call our present one-sided Free Trade is absolutely the very best that can be devised with regard to British interests and the interests of British trade. I believe the Free Traders are perfectly right in saying, as they do, from a cosmopolitan point of view, that universal Free Trade would be the best possible thing for the world at large; but I also believe that whenever that consummation is reached, if America, especially, becomes a Free Trade nation 1888 and gets rid of the shackles which now hamper her industry and her commerce, her trade will experience such a development that she will become a more formidable competitor to our manufacturing industry than we have ever hitherto experienced. I am convinced that if there were not an actual diminution in our trade, there would, at all events, be such a displacement of particular industries as must necessarily be attended by a great deal of suffering and loss. I proceed now to consider what is the nature and what is the ground for the proposal to which, we learn, this inquiry is to lead us. Well, I say, in the first place, that we ought really to have some solid, substantial reason given for any change at all. And I want to know where is the proof of such a depression in trade, such a disturbance of industry, as would justify any change in our present system? I think we may dismiss individual cases of small importance. And I say again that, speaking generally, the great branches of our industry—always excepting the agricultural interest—are in a satisfactory condition. The hon. Member for the Tower Hamlets (Mr. Ritchie) founds his Motion upon the following statement. He said, in the first place, that exports have increased recently in volume, but not in prices. I suppose the hon. Member meant not in value. Well, that is an admission which I think is absolutely inconsistent with his contention that trade had been going to the bad during the last five years. If the volume of our exports, the extent of our production, has been increasing during the whole of that period—and that I believe is the case—I do not think our manufacturers have much to complain of. The hon. Member proceeded to comment with some severity upon a Paper, written by Mr. Giffen, which has been presented, by the Board of Trade. That Paper is a continuation of Papers which have been presented on two several occasions, in precisely the same form, in the time of the late Government. In that Paper Mr. Giffen points out that there has been a considerable fall in the value of the raw materials of our principal industries; and he shows that this fall accounts for a reduction in the value of our exports, and does not involve necessarily a corresponding loss on the part of our manufacturers. Well, that is a 1889 fact which I should have thought was capable of mathematical demonstration. Let us take the case of cotton. The hon. Member for the Tower Hamlets (Mr. Ritchie) says that the raw material to the total cost of cotton is as 7d. to 1s. For the sake of argument, let us assume that it is half-and-half. Then suppose that our exports of raw cotton amounted to £1,000,000 sterling, £500,000 of that sum is a mere re-export of raw material, and it is only the remaining moiety which is the element of profit to the manufacturer and of advantage to this country. Now, supposing, what has actually happened, that the price of raw cotton is diminished by 40 per cent, then the raw material would cost £300,000 instead of £500,000; and if the exports should fall to £800,000, £300,000 of that sum would be attributable to raw material and £500,000 would remain—precisely the same sum as remains from the larger Return—and the element of profit to the manufacturer and the result to the country would be the same in both cases, although the total value of the exports would have been reduced by 20 per cent. Upon the question of exports I may say that such reduction as has occurred in exports is due wholly to a fall in prices, largely, if not entirely, to a fall in the value of raw material, and it does not represent any corresponding loss to the country. The second point made by the hon. Member for the Tower Hamlets has reference to the Income Tax. I have never denied that the profits of trade have been less lately than in times of extraordinary inflation, and I would go with the hon. Member for Preston (Mr. Ecroyd) so far as to say that perhaps the reduction is not fully represented by the Income Tax returns, which are based on the average of three years. But what I think is sufficiently shown by other figures is that the depression of trade, of which, we have all been complaining, is a depression which has hit the rich rather than the poor, and which has reduced the large and excessive profits, which were made in times of inflation, without interfering with the general prosperity or the general welfare of the country. The next statement made by the hon. Member for the Tower Hamlets (Mr. Ritchie) was that the consumption of articles of necessity has decreased. But in order to show any 1890 ground for such a statement the hon. Member had to pick and choose his figures in a way that is hardly justified by the facts of the case. The hon. Member said that the consumption of coffee has decreased. Well, that is perfectly true; there has been a change of taste, and, for some reason or other, the consumption of coffee has declined from 1.08 lb. per head, in 1840, to 92 in 1880. But we have made up, and more than made up, the decrease, by an enormous increase in the consumption of tea, and by a very remarkable increase in the consumption of cocoa. Between 1870 and 1880 the consumption of cocoa increased 50 per cent per head of the population, and the consumption of tea has increased steadily from l.22 lb. per head of the population, in 1840, to 4.70 lb. per head in 1879; and the fall to which the hon. Member referred was a fall of .11 in 1880, when the consumption was 4.59 lb., still being a consumption nearly four times as great as that of the year 1840.
§ MR. CHAMBERLAIN
I can assure the hon. Member that he is quite mistaken. In 1875 it was 4.44; in 1876 it was 4.50; in 1877 it was 4.52; in 1878, 4.66; in 1879, 4.70; and in l880 there was the small fall to which I have referred—namely, down to 4.59. The consumption of tobacco has risen steadily in the same way between 1840 and 1877, from .86 lb. in the first of those two years to 1.49 lb. in the latter. Afterwards there came a slight fall. And what was the reason of that fall? I think the hon. Member for the Tower Hamlets (Mr. Ritchie) has good reason to know. It was due to the action of the late Government in imposing a considerable increase of duty, which had the strenuous opposition of the hon. Member. In consequence of that change the consumption decreased from 1.49 lb., in 1877, to 1.43 lb. in 1880. The consumption of sugar and spirits has enormously increased, and the importation of other articles of food has enormously increased also. The last statement made by the hon. Member was based upon the returns of the Railway Companies; and in order to bring forward a favourable case, the hon. Member said the rates per head, per train mile, had decreased with- 1891 in the last few years. Well, that is so. No doubt the receipts per train mile have been reduced; but why? In the first place, because there has been a reduction of rates on the whole; and in the second, what is still more important, because the lines which have been opened of late years have been feeders and branch lines, and it is impossible that the traffic upon them could be equal to the average traffic upon the great main lines of the country. When, however, the total receipts from the traffic are examined a very different story is disclosed. The total traffic receipts in 1869 were£41,000,000; in l880, £61,958,000; and in 1881, though the official figures are not yet made up, they are about £64,338,000; and they are still increasing every month. If we take the returns of third-class railway traffic we shall find that the results are even more striking, and still more interesting, as illustrating the condition of the working classes. The receipts from third-class passengers have increased rapidly and continuously from £7,000,000 a-year, in 1869, to £15,000,000 in 1880. Thus in 11 years the travelling expenses of the poorer classes of the country have increased something like 115 per cent. There is only one other evidence of prosperity which I would offer to the House; but that at also is one which is very striking. It is to be found in the entrances and clearances of shipping at ports in the United Kingdom, which afford a more accurate indication of the prosperity and business of the country than even the export or import statistics themselves, in dealing with which there are many causes of error, such as the question of prices and the way in which values are computed. The comparison of import and export values, taking one year with another, may sometimes, from changes of price, be misleading, and such statistics must be used with care. The entrances and clearances of shipping, however, are not open to the same objection. I find that between 1870 and 1880—a period of 10 years—they have increased from 36,600,000 tons to 58,700,000—that is to say that there has been an increase in our foreign export and import trade, as shown by the entrances and clearances of shipping, of 60 per cent in that short period. It is perfectly clear, from these figures, that the volume of our trade has largely increased; and although it may 1892 not be quite as profitable, compared with what it has been in former times, still it would be absurd and foolish to suppose that it was altogether unprofitable. It may well be thought that our manufacturers may for a time go on producing at a small profit, or even at a slight loss, in order to keep their machinery going; but they certainly would not go on increasing and multiplying their works and investing additional capital in them, unless they saw their way to a remunerative result. Let us test the question another way. Looking at the great seats of industry, if there is anything like stagnation of trade it would be shown in the decline of their population and in the falling-off of their prosperity. What are the facts with regard to them? According to the Census Returns, between 1870 and 1880 the population of Birmingham increased from 343,000 to 400,000; and of Liverpool, from 463,000 to 525,000; Manchester has only slightly increased, because the limits of the borough are circumscribed, and as the ground is covered with houses already no large increase is possible. But Salford, in which a large proportion of the population of Manchester resides, has increased from 124,000 to 176,000; Bristol, from 182,000 to 206,000; Leeds, from 259,000 to 309,000; Leicester, from 95,000 to 122,000; and Nottingham, which is the most remarkable case of all, has increased from 129,000 to 186,000. I have had the curiosity to inquire into the condition of Coventry, which has been quoted as an illustration of a town that has been utterly ruined by Free Trade, and I find that in the same period the population of the Parliamentary borough has increased from 41,000 to 47,000. It therefore appears that even that town has recently, at all events, got over the blow it received through a Free Trade policy. But the increase of population is not the only index to the prosperity of a borough; and taking the rateable value of property, which largely consists of mills and other productive works, in similar boroughs, I find that between the years 1872 and 1879 the rateable value of property in Birmingham has increased from £1,229,000 to £1,454,000; Liverpool has increased from £2,768,000 to £3,211,000; of Manchester, from £ 1,805,000 to £2,296,000; of Bristol, from £719,000 to £838,000; and of 1893 Leeds, from £807,000 to £1,083,000. Then, I ask, where is the proof of depression? Where is the proof of stagnation in the figures I have read to the House? If we go further a field and take the newer seats of industry, like Barrow and Middlesborough, the proportionate increase has been much greater. But, whatever may have been our own progress, we are told that we ought still to he discontented because other countries have made still greater progress. That is a state of things which Fair Traders are totally unable to see with satisfaction. Now, 'I am very doubtful whether any proof whatever has been given that any other country has done as well during the last 10 years as we have. But even if other countries have progressed more than we have, I should have said that that proved nothing either for or against Protection; because in dealing with this matter it must be borne in mind what a multiplicity of factors we have to take into consideration in estimating the relative progress of foreign nations compared with our own. We should have to take into account the increase of population, the development of the means of communication, and many other matters besides the effect of fiscal regulations. A country in which the population is greatly increasing is likely to increase its products more rapidly than a country in which the population is stationary. Again, if, at the period which we select for our comparison, one country is without an efficient means of communication, and these have been subsequently supplied, we should expect the increase to be greater than in an older country where such means of communication have existed all along. We must consider also such special circumstances as war, famine, bad harvests, and other things which affect trade at particular times and in particular countries. Lastly, we have to take into account—and this is of particular importance in considering the difference which a calculation of percentages apparently shows—the initial condition of the country with which you make your comparison. In other words, if you were comparing a country with a trade of £1,000,000 and a country with a trade of £10,000,000, and both had increased their trade by the amount, say, of £10,000,000, it is quite clear that 1894 the increase in both cases is the same; but, calculated by percentages, the proportion of increase in the one case is 1,000 per cent, and in the other only 100 per cent. The increase is the same in amount in both cases; but the proportion in the one case is 10 times as great as it is in the other. I would gladly ask the House to listen to a comparison of the increase of the trade of this country with that of various other countries; but I feel compelled to confine myself to two. I will first take the case of France. The prosperity of France is particularly annoying to some hon. Gentlemen opposite, having regard to the negotiations for the old Commercial Treaty. Now, I find that the French exports—and I am making a concession to hon. Members opposite in dealing only with exports, for I hold that the true measure of a country's prosperity is to take both her exports and imports—during the period between the years 1850 and 1880 increased from £43,000,000 to £139,000,000, or an increase of 223 per cent. The English exports increased during the same period from £71,000,000 to £223,000,000, or an increase of 214 per cent. It therefore appears that the percentage increase in the exports of both countries has been about the same, or slightly to the advantage of France; but if we were to add the increase in what has been called our "invisible exports"—that is, in freight and shipping charges, which amounts to a considerable sum, the difference would be still less. But if you take amounts, which I contend to be the proper course, instead of percentages, the advantage is on the side of England, for while the increase in the French exports only amounted to £96,000,000 the increase in the English exports amounted to £152,000,000—that is to say that the English exports increased by more than 50 per cent more rapidly than the French exports. But, as I have stated, in all of these cases certain other circumstances have also to be taken into account in estimating the value of these figures. In the case of France the payment of the French War Indemnity has largely increased the volume of exports sent out by that country. The Indemnity had to be paid partly in bullion, but chiefly in exports, and it told upon the trade of France in the few years which immediately followed the war. The hon. Member 1895 for West Staffordshire (Mr. Staveley Hill) has used an extraordinary argument. He admitted that a large increase of exports from Trance into Germany resulted from the payment of the War Indemnity; but he considered that this meant a diminution of employment to a large portion of the German nation, and was, therefore, a disastrous thing—in other words, he contended that the payment of £200,000,000 was a bad thing for Germany. It followed, therefore, that its effect upon France was to stimulate employment and to encourage industry there, and that it would be a good thing for any nation to pay a tribute of £200,000,000, and a bad thing to be forced to receive it. There is also another matter—namely, the fact that about the same time the Provinces of Alsace and Lorraine became separated from the French Empire, and all goods passing thither were thenceforward transferred from the home trade account to the export account. If these two circumstances are borne in mind, it will add still further to the satisfaction with which we must regard the increased exports of this country, as compared with the exports of France. I may also point out, in the case of France, that the period I have chosen for comparison is a period during which their policy, though not of Free Trade, was a policy more liberal than it had been previously, and that that policy has largely contributed to the condition of affairs which I have described. The other case to which I wish to call attention is the case of the United States. That is a country, of course, in which the policy has been more retrograde than that, of any other country. I find in the United States that the increase in the amount of exports has been, in round numbers, from £26,000,000 in 1840 to £170,000,000 in 1880, or 554 per cent, as against an increase in this country from £5l,000,000 in 1840 to £223,000,000 in 1880, being an increase of 338 per cent, the actual increase having been £144,000,000 in the case of America, and £172,000,000 in the case of England. But this amount is altogether exclusive of what Mr. Giffen, in the admirable Paper which he read before the Statistical Society, called the "invisible exports," being the amount gained by our Mercantile Marine 1896 in freight and otherwise. That amount is proved, by the most conclusive evidence—by cumulative evidence—to have increased, in the same period, in the case of the United Kingdom, from £20,000,000 to £80,000,000. It will be necessary, therefore, to add a sum of about £60,000,000 to the value of our exports; and, adding that £60,000,000 to the £172,000,000, we shall obtain £232,000,000, which is nearly double the increase in the United States in the same period. There has been no increase whatever in their shipping trade, but rather, on the contrary, a decrease. Then, as to another point, if we take the exports of the United States, not at their amount, but per head of the population, and compare them with the exports per head of the United Kingdom, the advantage will be still more striking in favour of our policy. The exports per head of the United States have risen from £1 lls. 1d. in 1840 to £3 8,s. 1d. in 1880, while those of the United Kingdom have increased in the same time from £1 18s. 9d. to £6 9s. 5d. In other words, while the increase in the United States was 119 per cent, in this Kingdom it stands at 234 per cent. We must also take into account, in. dealing with the question, the character of the exports of the United States. They have introduced a protective policy in order to encourage their manufactures; I have already shown with what success. But the total result is this—they exported £17,000,000 of manufactures, against £191,000,000 from this country, of which we sent £24,500,000 to the United States, or more than their total exports altogether. Under these circumstances, whether the House regards the trade of the country absolutely or relatively to the trade of other countries, there is no real ground for alarm, and no cause for the inquiry which the hon. Member proposes. I will now ask permission to examine, for a few minutes, the various proposals which have been made. The first question I have to ask is this—is the food for the country to be taxed? The hon. Member for West Staffordshire (Mr. Staveley Hill) says "No"; the hon. Member for Preston (Mr. Ecroyd) says "Yes." I think it is desirable that those hon. Gentlemen should come to some agreement before supporting the Resolution for inquiry. The hon. Mem- 1897 ber for West Staffordshire says, in the Amendment he has put upon the Paper, that duties are to be levied on foreign produce, provided that nothing is done to raise the price or diminish the supply of food. I do not know whether the hon. Member thinks you can tax food without raising its price. I would, at any rate, lay down the axiom, to begin with, that that is impossible, and it is only by increasing the price that the object of the hon. Member for Preston can be achieved, and that you can stimulate the growth and prosperity of our Colonies. The modest proposal he makes would raise the price of homegrown corn also, and the result would be that the British consumer would have to bear a tax of £40,000,000, £14,000,000 of which would go to the Revenue if the foreign importations continued, and £26,000,000 would go, not to the farmer or the labourer—for if anything is proved by the experience of the past, it is that it would go neither to the farmer nor the labourer—but it would go to the landed interest, to enable them to keep up their rents. All I have to say of a proposal of that kind is that it could never be adopted by the country, or if adopted it would be swept away upon the first recurrence of serious distress. But now I want to ask the House to consider whether the proposition of the hon. Member for Preston is a practical proposal on another ground. At the present moment foreign countries supply us with 82½ per cent of the total quantity of food which we import, while the Colonies only send us 17½ per cent of that quantity. If we deduct the amount which comes from Colonies like New South Wales and others, which are practically free trading Colonies, only 5 per cent of our food comes from the self-governing and highly protective Colonies. The total amount of food sent by foreign countries is £138,000,000 sterling. I ask the House, therefore, whether it is possible, or whether it is conceivable, that this enormous transfer can be made? Does the hon. Member believe that these £138,000,000 worth more food can be produced immediately in our Colonies by any artificial process; or does he for one moment believe, on the other hand, that the Colonies, which are now only able to send us £30,000,000 worth of food, will be able to send us £138,000,000 in addition, and take our manufactures to 1898 the extent of £138,000,000 in return? I say, in the first instance, that they cannot produce the amount of food required; and then, that they could not take in return our exports to the amount indicated.
§ MR. ECROYD
I never said they would be able to do so at once. My proposal was to institute a gradual process.
§ MR. CHAMBERLAIN
Well, Sir, the hon. Member for Preston addressed the House for an hour and three quarters; and I certainly supposed at the end of his speech that he had put his views fully before the House. But that, it seems, is not the case. However, if the hon. Member does not think that this transfer could be effected readily with regard to the supply of food for this country from foreign countries to our Colonies, I should like to know very much what we are to do in the interval? If we are to retaliate upon foreign countries by imposing a duty on food imported from those countries into England, as a means of inducing them to alter their Tariffs, and effecting a transfer of the supply of food to the Colonies, I do not see where the food of the country is to come from; because it is impossible that in anything like a reasonable time our Colonies could produce an amount of food at all approaching to the quantity required. But even if they could, at a future period, produce it, they could not possibly accept payment for it in our manufactures. Is it conceivable that the populations of the Australian Colonies—considerably less than the population of London—and others, including Canada, the whole of whose imports from this country put together only amount to a total of £25,000,000 sterling—is it possible that they could take £138,000,000 more? And if they could not do this, look what would happen. I ask the hon. Member's attention particularly to this. If we cannot pay the Colonies for our food supply in manufactures, we must pay for it in bullion, and that would raise the "bogey" which hon. Members so dislike. Gold would be too plentiful in the Colonies, and too scarce in this country, and the consequence would be that the price of corn in the Colonies would soon rise to the price of corn in foreign countries, even with a 10 per cent duty attached. Trade will then go back into its old 1899 channels, and the only difference will be that this country will have to pay 10 per cent more all round. If, however, it were conceivable that, after a long series of years, the transfer to the Colonies could be effected, it would be only a transfer of business, and not a transfer that would be wholly to our advantage. Prom whomsoever we buy our food, they must take our goods in return; we cannot pay them in bullion; they must be paid in our manufactures. Foreign countries are now paid by our manufactures, although they will not continue to take our manufactures hereafter, because, upon the terms proposed by the hon. Member for Preston, we cease to find them the means of paying for them. But whereas, ex hypothesi, the Colonies are to produce dearer, and require the additional 10 per cent in order to produce at all, it is clear that they will send us less in return for our goods, and we shall be worse off than we are at the present time. Well, Sir, upon the supposition that we are going to make this extraordinary disturbance in trade which has been suggested by the hon. Member for Preston, I ask what it is supposed will become of the energy and capital of foreign countries now employed in the production of food? Do you suppose it will remain idle? No, Sir; the result will be that this energy and capital will be diverted from its present application, and you will simply have given an impetus to foreign manufactures, and raised up competition in other branches of trade. For my own part, I do not think we can contemplate without apprehension the possibility of a change under which America, which now exports 90 per cent of food, and only 10 per cent of manufactures, could only export 10 per cent of food and 90 per cent of manufactures; yet such would be the effect of the suggestion of the hon. Member for Preston, so far as the United States are concerned. Then there is another assumption which underlies the proposal of the hon. Member, and to which I am inclined to take exception. The hon. Member assumes that the Colonies which now levy protective duties would alter those duties in return for the increased produce which, under the proposed arrangement, we should take from them. But, Sir, I am of opinion that they would do nothing of the sort. At any rate, I am quite sure it would 1900 not be worth their while to do so, because the arrangement under which they supply us is only to be a temporary arrangement. As I understand the hon. Member, so soon as any foreign country comes to our terms we are to open our ports to it again. The hon. Member dissents from that. Then his project is one for excluding them, and is a much larger proposal than I had any idea he intended to make to the House. He proposes to exclude all food from the United States, and only to open our market to their manufactures. If the hon. Member thinks that the citizens of the United States are likely to fall in with that arrangement he must consider them much less "cute" than I do. I certainly always supposed that when the object of hon. Members opposite was attained, foreign countries which now imposed Protection were to open their ports, and that we were to open our ports in return. I should like to know what is to become of the English Protection in the Colonies which has been created. I cannot believe it possible that any Colony would allow that it would be of advantage to it to have such artificially created interests ruthlessly destroyed in consequence of some change of policy in a foreign country over which it had not the slightest control. Then I pass from the proposal of the hon. Member for Preston to that of the hon. Member for West Staffordshire, who expressly excludes food from taxation. I will not dwell on the objections which may be raised by the agricultural interest, although I would certainly say that if Protection is to be used at all, that interest has as much claim to it as any other. I cannot conceive how it can be desired to hamper that interest by adding 10 or 20 per cent to the articles required in agricultural business. But assuming that the farmers are taken in by these proposals on the part of their friends, and offer no opposition to them, then the next question I have to ask is—Are our raw materials to be taxed? And again—What are raw materials? The hon. Member for Preston (Mr. Ecroyd) proceeds on the assumption that we have, at the present time, an import of £35,000,000 worth of manufactures, which, according to the arbitrary classification adopted by the Board of Trade for purposes of comparison, is perfectly true. But if the hon. 1901 Member looks to the tables which give the details of this classification, he will find that there is hardly one of the articles enumerated which is not the raw material for one trade or another. Take, for instance, tanned leather. That is a raw material of the boot and shoe trade, and comes in free of duty; and to that fact was due the progress which that trade had made in recent times. If the hon. Member treated that as a manufactured article he would ruin the boot and shoe trade; if he treated it as raw material, then he would be forced to reduce this £35,000,000 of manufactures, and so on with other articles, until there would remain only an insignificant sum—certainly not more than one-fifth of the original amount. How, upon this remaining sum of £7,000,000 of bonâ fide manufactures, he is going to raise the revenue which will enable him to offer a serious reduction of the burden, of taxation, for the life of me I cannot understand. I think my hon. Friend the Member for the University of London (Sir John Lubbock) has already dealt with another part of this subject. The hon. Baronet has pointed out with perfect truth that if we are to enter upon this game of Retaliation, it is a game at which two can play, and that we shall play at it at a great disadvantage. Our imports of manufactures and half manufactures are only £35,000,000, while we export £190,000,000, which would leave a balance of £155,000,000 on which we stand to lose in the game of Retaliation; and, therefore, I cannot but regard the proceeding as a very risky one. I may mention that France is the only important case of any foreign country whose export of manufactures to us is greater than our export of manufactures to her; and I wish for a moment to look at the case of France, because it illustrates the error into which hon. Members fall, and are likely to fall, without a knowledge of all the circumstances of the case. Although the export of French manufactures to us is larger than the amount of our manufactures imported into France, yet I believe that a great part of those manufactures which appear in our Returns are manufactures in transit. It is a curious fact in connection with this that the Italian import of our manufactures is much larger than their exports to us; and I am led to believe that there is a sort of triangular trade 1902 going on between the three countries—England, France, and Italy; and that Italian silk and wine go first to France, where they are more or less treated, and then come to us as French manufactures, whereas, in reality, they are Italian manufactures, and we pay for them, not in manufactures sent to France, but in manufactures sent to Italy. Any proposal, therefore, for a Tariff upon French goods would not only affect our trade with that country, but would be an interference with our export trade to Italy. Then, Sir, there are other serious objections to a policy of Retaliation. There is the objection that, resulting as it does in the protection of home industries, it destroys all stimulus and competition. That, undoubtedly, is a very serious matter. The hon. Member has referred to the condition of the woollen industries, and especially to the case of Bradford, which affords one of the most striking illustrations of the advantage of our Free Trade policy. Some years ago the French made great improvements in their manufacture of wool, and in consequence substituted articles of better quality and more pleasing appearance than the English goods, and the woollen trade in this country suffered. What would have happened in the absence of the policy of Free Trade which the country adopted? The English manufacturers would have had no stimulus to the improvement of their goods, and the English manufacture of to-day would have been the same as it was 25 years ago. But under the policy of Free Trade the English manufacturers have been able to look the matter in the face; they have altered their process of manufacture, and they are now competing successfully with the manufacturers of France. I was told by an English manufacturer the other day that his orders were larger than he ever recollected them to be, and that he, at least, was perfectly satisfied with the present condition of the woollen trade. Another illustration was to be found in the case of the edge-tool trade of Birmingham, which was at one time almost destroyed by competition from America. It was not that the goods were cheaper, but American makers had discovered what was the best form of edged tools for various purposes; and I must say that our manufacturers were very slow to adopt these improvements, and some- 1903 what conservative in their objections. However, in the face of this competition with the English manufacture, Birmingham is now producing articles which are better in quality and cheaper in price than the American goods, and which are now successfully competing with them in Australia and other Colonies. Finally, Retaliation, Compensation, or Protection—by whatever name it is known—must have the effect of creating weak interests, which will have afterwards to be abandoned, and which will, in consequence, give rise to great suffering and loss. Sir, I ask the House to meet this Motion with a negative. Had it been possible, I should have desired the Amendment of my hon. Friend the Member for Oxfordshire to be accepted; but, as that Amendment cannot be put, I hope the House will vote on the Main Question, that you, Sir, "do now leave the Chair." I express that hope upon the ground that the hon. Member for the Tower Hamlets (Mr. Ritchie) has made out no case. The condition of trade is not unsatisfactory. It is, I believe, in a state of growing prosperity. The temporary depression from which it suffered has passed away; and it has been said truly that this improved condition of things has been coincident with the advent to power of a Liberal Ministry. If hon. Gentlemen opposite are successful in their endeavours to bring about a change of Government, perhaps the hon. Member for the Tower Hamlets will in the course of a few years have a much better foundation for such a Motion as this than he has at present. I remember quoting, in reference to this matter, a conversation reported to me three or four years ago, in the time of the late Government, which I might be allowed to mention once more to the House. A friend of mine was talking to a merchant in Birmingham, who happens to a Conservative, and this gentleman was expressing his alarm at the proceedings of the Radicals, and gave his idea of the evil results which would follow if my right hon. Friend (Mr. Gladstone) should ever again assume the reins of Office. My friend, out of mere curiosity, wound up by saying—"Well, but if it should happen that Mr. Gladstone should be Prime Minister, would you leave the country, or what would you do?" and thereupon this gentleman, whose candour overcame 1904 his Conservatism for a time, said—"Well, to tell you the truth, I should buy all the copper I could lay my hands on, and hold for a rise." Well, I really do not know, Sir, whether that gentleman carried out his intention; but all I can say is that if he has done so I believe he will have no cause whatever to regret it, because the price of copper has risen, and the demand for it has increased. The price of almost every article of our manufacture has also risen, and the demand increased. In the second place; I ask the House to reject the Motion of the hon. Member, because it appears to me to be undoubtedly a retrograde step in the direction of a reversal of that policy under which the prosperity of the country has so greatly increased, and its resources have been so enormously developed; under which wages have risen; under which the necessaries of life have been cheaper, which has added to the comfort of all classes of the people, which has, above all, removed just causes of discontent, and has done much to settle on a secure basis the foundations of settled government, and of social order.
§ SIR STAFFORD NORTHCOTE
Mr. Speaker, I will detain the House a very few minutes; but I find it necessary, of course, to rise after the special appeal which has been addressed to me by the right hon. Gentleman the President of the Board of Trade. Sir, I must, in the first place, remind the House what is the question before us. The question which is actually before us is that which is raised by my hon. Friend the Member for the Tower Hamlets (Mr. Ritchie), who asks that—A Select Committee be appointed to inquire into the effects which the Tariffs in force in Foreign Countries have upon the principal branches of British Trade and Commerce, and into the possibility of removing, by Legislation or otherwise, any impediment to a fuller development of the manufacturing and commercial industry of the United Kingdom.I venture to say that that demand, supported as it is by the very temperate and very well delivered speech of my hon. Friend, is one which we ought to consider well before rejecting it. The right hon. Gentleman opposite says he can hardly understand how I could support or accept such a proposal as this, consistently with what I said when, 1905 two years ago, Mr. Wheelhouse made a proposition for a Select Committee on the same subject. On that occasion I certainly did say—speaking on behalf of the then Government—that we could not assent to that proposal, because it might give a wrong impression and produce a false idea as to our commercial policy. Well, Sir, the right hon. Gentleman says—"How do you consider that circumstances differ on the present occasion from what they were then?" I say, in the first place, there is the broadest possible distinction between the proposal made by Mr. "Wheelhouse, and still more the speech by which that proposal was supported, and the proposal and speech of my hon. Friend the Member for the Tower Hamlets. The Motion of Mr. Wheelhouse was for a CommitteeTo consider the Commercial Relations at present existing between England and Foreign Nations, especially with regard to the import of Manufactured Goods from Abroad, as well as the effect caused by our system of one-sided so-called Free Trade, with a view (if possible) of ameliorating the condition of the wage classes of the country."—[3 Hansard, ccl. 604.]And every word of the speech of Mr. Wheelhouse was directly in favour of Protection. My hon. Friend has taken an entirely different line. He has drawn attention to certain points which I will refer to in another moment, and he has asked for a Committee which would do something very different from that which Mr. Wheelhouse proposed. But I do not rest the case simply upon the difference between the Motions of Mr. Wheelhouse and my hon. Friend. We are asked what has happened since then? Why, two things have happened. One of those things is a speech that was made by the Prime Minister himself last year, and the other is the result of the negotiations respecting the French Treaty. The House can hardly have forgotten the speech that was made by the Chancellor of the Exchequer on the 4th of April, in moving his Financial Statement; it has been already quoted by my hon. Friend; but I am sure the House will not be sorry to hear the words again. The Chancellor of the Exchequer paused in the middle of his Financial Statement, in order to draw the attention of the Committee to a subject which he thought required attention. He said— 1906There is another point on which I think it is necessary to say a few words, because in my estimation we have reached a period at which I think the attention of the Committee ought to be addressed to it. I think this is one of those junctures which undoubtedly renders it, if not obligatory, at least expedient, that this should be done. I wish to present to the House, in a very succinct and general form, a few figures which, I think, illustrate in a striking manner the present movement of public wealth as compared with population and expenditure. This is a subject which does not annually come under the consideration of the Committee; but, undoubtedly, it is a subject that periodically it is desirable should be brought into view, and especially so when a change has been taking place with respect to which the Minister may happen to believe, as I believe, that neither the public nor Parliament are fully aware of it. We make ground at such a rate, and for such a long time, that people begin to believe we shall never cease to make ground; but I wish Parliament to understand that we are not making ground at present. I speak of the last few years, and without reference to Party differences, and I say we are rather losing than making ground."—[3 Hansard, cclx. 580.]The right hon. Gentleman then proceeded to draw attention to the various statistics which were quoted by my hon. Friend. We have had a very simple explanation given by the hon. Baronet the Member for the University of London (Sir John Lubbock) and adopted by the President of the Board of Trade; they attribute our losing ground for some time to the fact that we have had a Conservative Ministry. But what is remarkable is that the right hon. Gentleman the President of the Board of Trade, when he quotes figures to show that the idea of the distress of the country is exaggerated, and that we are not losing but making ground, should take his figures from the very time of which he speaks so lightly. This very evening some of the figures which he gave us with regard to the growth of population, on which he so much dwelt, relate to the years from 1872 to 1879, of which two years belong to the one Government and four or five to the other. Well, then, I remarked in the speech which he made last year, and which he published with an appendix, that his comparative statements were made as to the progress of various branches of industry in the six years from 1869 to 1874, and the six years from 1874 to 1880, and that he showed greater progress in a large number of branches of industry during the last six years than during the previous six years. 1907 The hon. Baronet (Sir John Lubbock)—and I heard it with surprise, coming as it did from him, who is usually so fair—stated that our troubles began when the late Government came into Office. Why, it was immediately pointed out to him that the decline began two years before—in the year 1872—and that there was a small decline in that year and another in the following year. But really, if these are the arguments used, would it not be worth the while of the Government to let us have a Committee which would bring out these important points, and which would give us the opportunity of cross-questioning a little and examining into the reality of statements of this general character, which are used so glibly, and which pass muster, no doubt, amongst those who do not know better. We want to know with regard to the difference in our position in consequence of the failure of the French Treaty negotiations. I was struck just now by one of the opening observations of the right hon. Gentleman. He stated that he gathered from the speeches which had preceded him that Protection was or was not called Protection according to the object with which any particular duty was imposed; that the duty imposed for one object would be called protective, but if imposed for another object the same duty would not be called protective. I think we may turn that observation upon the right hon. Gentleman and his Colleagues, with regard to the important question that is sometimes called Reciprocity and sometimes Retaliation. It is not Retaliation, or even Reciprocity, in what is considered the sense of the word by Free Traders. If you propose to a country like France that if she will make certain concessions you will take 6d. a gallon off the duty on her wines, it is not at all objectionable. But if, on the other hand, you say to France—"We intend, if you do not make certain concessions, to add 6d. a gallon to the duty on your wines," it is called Retaliation. I adhere entirely to the views which I have always expressed on this subject. I am as firmly convinced of the soundness of the general principles of Free Trade as I have ever been in my life; but I do not see where you are to bring about the mischief which is apprehended, if you assent to the proposal which is made by my hon. Friend for a fair inquiry into 1908 this subject. It is obvious, if you have the confidence which you ought to have in your own system, you ought not to be so much afraid of subjecting it to examination. The right hon. Gentleman did not use the words that were uttered the other day upon another subject by the noble Marquess the Secretary of State for India; he surely will not say that the Free Trade system, as it stands at present, is either so sacred or fragile that it will not bear inquiry. What I think you would gain by an inquiry would be this—that you would clear the minds of those outside who are at present agitated by what is going on. Do you suppose there is no real excitement in the country upon the subject? Do hon. Gentlemen dispute what the hon. Member for Preston (Mr. Ecroyd) says? Do they deny that there are, in many of the Northern manufacturing towns, large bodies of persons who are much agitated upon this subject, and who are, many of them, adopting what I think to be wild and mistaken ideas, but still ideas which are deserving attention, and which it would be most profitable that you should be able to deal with and explain? I continually hear statements made here and elsewhere which are at once contradicted, and you scarcely know how to deal with the controversy. Take a question about which a good deal has been said—I mean the question of the balance of trade. I think it would be a great advantage if we were able to follow up that question more closely than we are able to do in a debate of this kind. And so with other questions, even that suggested by the hon. Member for Preston (Mr. Ecroyd)—the question of a Colonial or Imperial union for the purpose of doing away with duties between the different parts of the Empire. Even that, I think, is worth consideration and discussion, though I am bound to say that, to me, it seems to be beyond reach at the present time. It would be well to discuss the difficulties which beset many of our manufacturers; it would be well if we could go into the whole circumstances to see whether—and my hon. Friend (Mr. Ritchie's) Motion is quite wide enough to cover it—to see whether there is no other method besides that of retaliatory duties which could be adopted, and adopted with advantage, to remove— 1909The impediments to a fuller development of the manufacturing and commercial industries of the United Kingdom.I believe that many questions would be raised and would be discussed before such a Committee as is now proposed which, it would be extremely advantageous we should discuss. I am sorry to find that the Government do not intend to assent to the very moderate request of my hon. Friend.
Sir, when the right hon. Gentleman rose I was in hopes that he rose for the purpose of disclaiming with decision, and, perhaps, even with a little indignation, the imputation that had been cast upon him by my right hon. Friend the President of the Board of Trade, to the effect that he meant to completely reverse the course that he had taken two years ago, and that, having then refused to assent to a Committee of Inquiry into the policy of Protection and Free Trade, he now meant to support a similar proposal. Disappointments, however, are not uncommon, and our political education, as the right hon. Gentleman said the other day, is always advancing, and we are constantly hearing of some possibility which we had hitherto believed to be impossible. I propose to examine what I must call the very flimsy reasons given by the right hon. Baronet for his extraordinary change of front. The first reason given is that this Motion differs from a former one on the same subject. The present Motion is one which calls upon Parliament to inquire into the effects which the Tariffs in foreign countries have upon the principal branches of British trade and commerce, and the Motion of Mr. Wheelhouse was a Motion of which the most salient point was that it was to inquire into the system of so-called one-sided Free Trade. Now, except that there is, as I must admit, a certain improvement in the English of the present Motion as compared with that of 1880,I affirm that the substance of the two Motions is precisely the same. The question of the hostile nature of foreign legislation and high Foreign Tariffs is the basis of both, and a comparison between that hostile legislation and those high Tariffs and our own system of free imports is the subject which, in that case and in this case, the Committee was to be called upon to examine. The next reason is that I 1910 made a speech in which I stated to the House of Commons last year that whereas we had been accustomed to take for granted that we were always making ground it was doubtful whether, at this moment, we were really doing so; and my illustration, drawn entirely from the profit-making classes and not from the wage-receiving classes of this country, was drawn from the fluctuations in the value of the 1d. on the Income Tax. [Sir STAFFORL: NORTHCOTE: Customs and Excise receipts as well.] And a comparison, likewise of the movements of the receipts in various years from the Customs and Excise. Aye, but not to show, as regarded those movements of receipt, that we were not making ground, but to show that we were not making ground as compared with the population and expenditure of the country, which is a different thing. But why an exhibition of a fact of that kind, which appeared to be a matter of public interest, and likely to have a salutary effect on the temper of this House in regard to public expenditure and public economy, should be a reason for adopting a measure which the right hon. Gentleman himself condemned a year before as calculated to shake the confidence of the country and propagate false impressions with respect to the intentions of the Government and Parliament as to our commercial relations, the right hon. Gentleman did not in any single word of his speech explain. And what was the third of these three reasons which I have ventured to call—but I will not use the word again. What is the third of these three most unsubstantial, most scanty, most ethereal, most transcendental reasons?—all these, I hope, are Parliamentary expressions, and have, at least, the tacit approval of the hon. and learned Gentleman the Member for Bridport (Mr. Warton).
I did not intend to impute to the hon. and learned Member that he did object to the word. I meant to fortify myself against those who objected by showing that I had the sanction of the hon. and learned Member for that expression. The third reason was that we had failed in the commercial negotiations with France. Well, Sir, let that pass. Undoubtedly, at the pre- 1911 sent moment, the facts before the House are to the effect that the efforts which have been continued for many years to effect a renewal of the Tariff Treaty with France have now come definitely to an unsuccessful termination. Be that so; but why is that a reason for investigating our system of Free Trade? The speech of the right hon. Gentleman was to the effect—and I admit that a great deal is to be said in that sense—that these Tariff Treaties were doubtful and entangling instruments, and that they imparted something of, at least apparent, disparagement to the principles of Free Trade. Then, Sir, it appears that, escaping from the meshes of the Tariff Treaty, we have emerged from a murky into a clear atmosphere, and that those principles of Free Trade on which we stand in our fiscal legislation are no longer disparaged, no longer brought into any doubt or question by our having, at least apparently, made some portion of them ultra vires. And why is that more complete, and thorough, and rigid establishment of the principles of Free Trade, if we are real Free Traders, to be made a reason for a Parliamentary A inquiry? "Oh," says the right hon. Gentleman, "do not show a mistrust of the principles of Free Trade by refusing an inquiry into them." Why, Sir, if we were to propose in this House a Committee to inquire whether it was desirable to continue the system of trial by jury, or a Committee to inquire whether it was desirable to revive the rotten boroughs extinguished by Schedule A of the Reform Act, should I be told that I was showing mistrust in the Reform Act, or mistrust in trial by jury, if I said—"I shall vote for no Committee for such a purpose?" No, Sir; the right hon. Gentleman gave us these three reasons; but in his speech there was this one fatal defect—that he did not answer the reason he himself gave in l880. In 1880, when this same proposal was made, he said—I wish distinctly to say on the part of the Government. … that they think it would be wrong by any doubtful proceeding, countenanced especially by them, to raise a false idea or to produce a wrong impression as to their commercial policy."—[3 Hansard, ccl. 619.]This is a proposal tending to produce a "false idea" and a "wrong impression" as to our commercial policy; and for that proposal the right hon. Gentleman 1912 is now going to vote. I do not like, at this unreasonable hour—1.10 A.M.—to detain the House; but two or three words I must say. The right hon. Gentleman on that occasion was emphatically right in the words he used, and he has not attempted to reply to those words; nor has he told us that the appointment of this Committee will not raise a false idea or produce a false impression. And why has he not told us that? Because he knows that the whole value set upon the proposal by nineteen-twentieths of those who will support it is just because it will give a false impression and raise a false idea. If this were a matter carried on with closed doors and within the walls of this country, as we have walls to this House, then I think that the excitement that might prevail here, and the false expectations that might be raised, would, perhaps, be comparatively harmless. The hon. Gentleman the Member for Preston (Mr. Ecroyd) might amuse the enthusiastic working men whom he is in the habit of addressing, and, no doubt, they would be exceedingly pleased with one another on the repetition of the occasions to which he has referred. Although I think a great deal of delusion would be propagated throughout the land, yet I admit that it, after all, would be child's play, and would never have a result, for the bubble the right hon. Gentleman is blowing would burst in the first moment of its existence. Unfortunately, the knowledge of these proceedings and the proposal for this Committee of Inquiry, and the knowledge that the proposal for such a Committee has been supported by the late Leader of the House of Commons, which I deem to be a fact far more important than the proposal for the Committee itself, cannot be confined within these walls, and cannot be confined within these shores, but will go abroad. I will not ask the Mover of the Motion whether he is prepared to face the consequences of his own success, for I take it that he is perfectly prepared to do so; but I should like to know how the right hon. Baronet would face the consequences? Does he not know, as well as I do, that the fact of such a vote having been given by the House of Commons, going forth through Europe to the civilized world, would at once become the strongest argument in favour of Protection, in favour of hostile Tariffs, 1913 in favour of those who are fighting the battle of commercial legislation, who would then be able, for the first time, to say—"See that this delusion of Free Trade, even in its stronghold, is now shaken to its base; and one, at least, of the great Parties in the country has, by the mouth of its Leader, admitted that it has become a subject for solemn inquiry, re-trial, and re-investigation whether the great struggle of 30 years ago is to be fought over again or not, and whether the system of free importation is to be reversed?" I cannot really understand by what process of mind it is that a Gentleman of a tenth part of the knowledge and experience of the right hon. Baronet could bring himself to the conclusions to which, apparently, the unfortunate necessities of his position have forced him. This I must say—I do not believe the right hon. Gentleman anticipates the success of the Motion. I must further own that, though there are no arguments for the Motion, there are some temptations to concur in it; for I should be very much interested indeed in viewing the proceedings of the Committee, considering the nature of the component parts which would make it up. There would be one Gentleman with his modest proposal of simply a retaliatory duty upon wine. There would be another Gentleman with his proposal of a 10 per cent duty upon foreign manufactures and articles of food, but not upon raw materials; and another with his proposal for a duty upon foreign manufactures and raw materials, but not upon articles of food. And, Sir, I would venture to give this advice to my hon. Friends on this side of the House, in the impossible event of the House voting the Committee, that the whole enjoyment of that Committee should be left to its supporters. If it were possible for them to secure a Committee Room within the precincts of the Tower of Babel, it would be the most appropriate site. It is not my intention, at this hour, to detain the House upon a question which I greatly regret should have already occupied so many hours of time which is wanted for purposes more urgent and more practical. The House will, I have no doubt, reject this Motion; and they will reject it on the very ground so happily stated and recorded for us by the right hon. Baronet two years ago—on the ground that the adoption 1914 of the Motion would do mischief in this country, and, to some extent, mischief in foreign countries, to an enormous extent, by propagating the false and erroneous idea that we, in the teeth of all the demonstrative evidence, of which portions have been laid before us tonight in the admirable speeches which have been delivered on this side of the House, are about to lose the fruits of the struggles of a generation of men, and about to compromise a system which has contributed largely and mainly to the unparalleled wealth, strength, and prosperity of the country, and to revert to a scheme of delusions and impostures which, happily, have been banished from these three Kingdoms.
§ MR. O'DONNELL
said, he would not trouble the House for more than a very few minutes. It happened that some of the Irish Members were in favour of inquiry into the system of free imports; and, without wishing to criticize the admirable and able speech they had just listened to from the Prime Minister, he wished they could hit upon some system of inquiring into the working of the rule and plan we had adopted, which would not have such terrific and formidable effects at home and abroad. He would only call the attention of the House to this fact—that in the opinion of the vast majority of the Irish people the introduction of Free Trade, under the circumstances, at any rate, in which it was introduced, simply completed and assured that ruin 'of Irish agriculture which was at the bottom of the social and political difficulties which were now tasking the energies of both political Parties. In the second place, it was the opinion of some—[Interruption.]—he begged hon. Members' pardon, and could assure them that he did not intend to delay the House long, and that conversation in loud tones was not calculated to shorten the length of his remarks. Some Irish Members, at least, were of opinion that an inquiry into the defects of our present system of absolutely free imports would throw a much-needed light upon the settlement of Irish agricultural questions. He would venture to submit this to the consideration of the Prime Minister—Supposing the effect of the present system of absolutely free imports, competing with that important branch of native industry, Irish agriculture, rendered it absolutely impossible 1915 to have such a thing as a fixation of fair rents for any length of time—supposing the working of the absolutely free system of imports made the system of fair rents calculated on a duration of 15 or 20 years a system of unfair rents within five years, would it not be well worth while to have some system of inquiry by which the political Leaders on both sides of the House would know that in trying to fix rents in Ireland on the basis of a 15 or 20 years' duration they would only run the risk of insuring a fresh crop of discontent? Some safer way of arriving at facts than at present existed was badly wanted; and it was the opinion of large numbers of people in Ireland that before long, in consequence of this evil, the absolutely unchecked system of free agricultural imports into Ireland must be remedied. A collection of trustworthy statistics, which could only be arrived at by such an inquiry as was now suggested, was really necessary for the settlement of the Irish agrarian question; and if that was not the opinion of the Liberal Party, he was afraid they were not likely to succeed in administration in Ireland.
MR. NEW DEGATE
said, he wished to express the impression which the eloquent and most energetic speech of the First Lord of the Treasury had made upon him. The right hon. Gentleman seemed to feel that dwelling under a system of free imports was like dwelling in a glass house. The right hon. Gentleman continued to use the words "Free Trade;" but he varied it with the words "free imports," because no man knew better than he did that free import on one side and Protection on the other was not Free Trade. The right hon. Gentleman and his Friends must cease to call themselves Free Traders; they had no hope of becoming so, for the negotiations with the French Government had put an end to the delusion under which free imports were instituted. Yet the House was now called upon deliberately to reject a proposal to inquire into the position of this country under these altered circumstances. He had been called a "bigot;" but if ever there was an instance of bigotry, it was in the refusal of this inquiry. If ever there was a confession of weakness, it was in the refusal of this inquiry by those who longed to be called Free Traders, but knew that the system which they had maintained 1916 was no longer Free Trade. He had agreed with the Prime Minister last year when the right hon. Gentleman pointed out in his Financial Statement that the position of this country had become most grave under these circumstances; and he rejoiced that the right hon. Baronet the Member for North Devon (Sir Stafford Northcote) had had the courage to repeat the demands of the country for an inquiry into this altered position.
§ MR. BIDDELL
said, he was glad of the admission that the slackness of their manufacturers had, in part, arisen from the depression of agriculture. It was evident the agricultural and manufacturing industries understood each other better than formerly. The right hon. Gentleman the President of the Board of Trade had stated that the total imports and exports of a nation were the best test of its prosperity. Accepting that data, he would compare the two years 1872–3 with those of 1879–80. Why he had selected the former period was that wheat in it had sold higher than for 15 or 20 years past—namely, at 58s. per quarter; in the latter at only 44s. per quarter. Another reason he made the comparison was to show the manufacturers that a high price of corn was not inconsistent with their prosperity. In the first period their annual imports, in round numbers, amounted to £312,000,000, their exports to £363,000,000; together, £675,000,000; while in 1879-80 the annual imports were £267,000,000, and their exports were £392,000,000; together making a total value of £659,000,000. Their poor relief and management cost in the first period annually £14,000,000, and in the latter £16,000,000. Their Custom duties were respectively £20,500,000 and £19,500,000. The right hon. Gentleman had largely alluded to the United States. Well, how stood we with them? Why, our export trade was declining. In 1872–3 we annually sent them exports to the extent of £36,000,000; while in 1879–80 we sent only to the value of £26,000,000. As to corn, their annual growth in the first period was 11,500,000 acres; in the latter only 10,750,000. Their increasing dependence upon foreign supplies for their food was, to his mind, a most serious matter, and should, if possible, be checked by encouragement to the home grower. Not that he would place any duty on 1917 corn to maintain rents, or he might even say to uphold the tenant solely; but, looking at the general welfare, he thought a duty placed upon wheat when only it was at a low price would be beneficial to the country in maintaining the growth of corn in it. He totally denied it was a question of rent, for, whether that was reduced or increased, the land should either be used for the growth of corn or grain, whichever was found to be most profitable. One of the strongest arguments used by the right hon. Gentleman in favour of Free Trade was that if we set the example other countries would follow us; but that prognostication had been falsified, as the proposed Committee could inquire.
§ Question put.
§ The House divided:—Ayes 140; Noes 89: Majority 51.—(Div. List, No. 60.)
§ Main Question, "That Mr. Speaker do now leave the Chair," put, and agreed to.