KING'S SPEECH (MOTION FOR AN ADDRESS).

HC Deb 08 February 1904 vol 129 cc668-708

Order read, for resuming adjourned debate on Amendment [8th February] to Main Question [2nd February], "That an humble Address be presented to His Majesty as followeth—

"Most Gracious Sovereign,—

"We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Ireland, in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament."—(Mr. Hardy.)

Which Amendment was— At the end of the Question to add the words, 'But it is our duty, however, humbly to represent to Your Majesty that our effective deliberation on the financial service of the year is impaired by conflicting declarations from Your Majesty's Ministers. We respectfully submit to Your Majesty the judgment of this House that the removal of protective duties has for more than half a century actively conduced to the vast extension of the trade and commerce of the realm and to the welfare of its population; and this House believes that, while the needs of social improvement are still manifold and urgent, any return to protective duties, more particularly when imposed on the food of the people, would be deeply injurious to our national strength, contentment and well being.'"—(Mr. John Morley.)

Question again proposed, "That those words be there added."

* MR. EMMOTT,

continuing his speech, said in addition to the fact that everything would be made dearer by these proposals there were other terrors so far as the cotton trade was concerned in connection with it. There was the danger that reprisals might be made against cotton on account of our imposing import duties on other articles. If we resorted to a protectionist régime in this matter, it would be manifestly unfair not to allow India to resort to protection also, which would react considerably on the cotton trade of this country. Another danger was that we should be menaced with an increase in the price of raw cotton. The Colonial Secretary had approved of Mr. Charles Booth's recommendations. Mr. Charles Booth recommended a 5 per cent. import duty on all articles introduced into this country from abroad, whether food or raw materials, and a 10 per cent. duty on manufactures. A 5 per cent. duty on all cotton coming to this country would bring in something like £2,000,000 to the Exchequer, but he knew perfectly well that the matter could not stop there and therefore proposed also a system of drawbacks upon manufactured goods exported from this country. Such drawbacks on manufactured cotton would amount to at least £1,500,000, so that the ultimate benefit which the Exchequer would receive would be only some £500,000. Could anybody conceive a more stupid proposal than to tax a trade with a turnover of £90,000,000 or £100,000.000 a year in order to bring in £500,000 to the Exchequer? The inevitable result would be that no spinner would use cotton coming from India or the Colonies. He would get all his cotton from foreign countries in order to get back the whole benefit therefore of the drawback. That had been the effect, so he had been informed, of the corn duties which were recently imposed, and which were taken off last year. He had been told that the effect among the millers of Liverpool had been to increase the use of foreign corn, and to decrease the use of home corn, and the effect would certainly be the same with regard to cotton. He did not suggest for a moment that every trade would be affected so strongly as the cotton trade, but every trade would be affected, and it was only a matter of degree. The exported manufactured goods of this country as a whole were much greater than the imported goods, and the principle applicable to the cotton trade applied to trade as a whole. It was a mistake and a delusion to suppose that even if trade as a whole benefited by this new policy, every trade would. It was assumed that some trades might benefit without hurting others; he did not agree with that assumption. He believed that some would benefit and some would not. Injury must result to the cotton trade if tariffs wore imposed for is depended not on the home but foreign markets in which it could not raise its price in consequence of the increased cost of manufacture. There fore, if the cost of the food and the wages of the operatives were raised, a disaster would overtake the cotton trade which was so vast an industry that any disaster happening to it would be a national calamity.

Turning to the general question, he was lost in astonishment at the fact that these new proposals had been so suddenly sprung upon the country. He did not allude to what the protagonists of this policy said in 1885, but in 1885 every symptom now complained of was apparent and he would say that those who were in favour of protection then and were in favour of protection now were greater statesmen by far than those who had become protectionist so recently. In June, 1900, the right hon. Member for West Birmingham said— The prosperity of the country during the last live years has been beyond record. Never before has labour been so well employed or so well remunerated. On the 24th of October the right hon. Gentleman said— Is it too much to say that in these last twelve months the Empire has been born anew. And again on 10th May, 1901, the right hon. Gentleman had said— Do not let us exaggerate. When every penny of the new taxation has been paid, the United Kingdom will still be, in proportion, the most lightly taxed nation in Europe. First of all they had those statements on the authority of the right hon. Member for West Birmingham. Three years afterwards, they were told the Empire was in danger by the same gentleman, who, in a speech at Leeds, said as regards the progress of the country— Speaking generally, I say that it is true that in the comparative wealth of the country, in the rate of wages, and in the condition of pauperism, they (the protected nations) have made more progress than we have. Taking these protected nations as a whole—they comprise every nation in Europe and the United States, the Colonies, and many other countries—you will find that statement absolutely correct. In regard to that statement, Mr. Bowley, the well-known statistician, challenged the Tariff Reform League to produce satisfactory evidence for that statement, and said that as a preliminary he would ask for— The evidence for any two countries, as I greatly doubt the existence of sufficient statistics of wages and pauperism for the last twenty years in any countries, except perhaps the United Kingdom, the United States of America, France, Germany, and New South Wales. The Tariff Reform League had taken the challenge of Mr. Bowley lying down; they did not reply to it for the simple reason, he supposed, that they could not. He did not know whether the statement which had just been made by the President of the Board of Trade would affect the situation materially. The right hon. Gentleman had made it perfectly clear that, so far as he himself was concerned, he did not advocate retaliation from a protectionist point of view, and it must be remembered that the right hon. Gentleman had spoken on behalf of the Government. The question he (Mr. Emmott) desired to ask, and it was one which was germane to the consideration of the subject, was this. Nothing more had been heard than the fact that a second pamphlet had been handed to the Cabinet by the Prime Minister, which directly recommended the taxation of food, and what he desired to know was, how the taxation of food now stood in the Government programme. It had been denied by one right hon. Gentleman, and it had been accepted by another, and everyone was in the dark. Testing this question from the standpoint of protection versus free trade, the allegation was made that protectionist countries had made more progress than we in the last few years. My first point is one of dynamics not statics. It was said that 13,000,000 people of their country were on the verge of starvation. In order to arrive at that figure, by Mr. Rowntree's method, it would be necessary to include in that proportion the three classes of wage earners, A, B, and C. Class A were those who brought home under 18s. a week; Class B were those who brought home from 18s. to 21s. a week; and Class C were those who had from 21s. to 30s. a week coming into their house. Let them compare those statistics with those of Germany. They had no accurate figures for any part of Germany except Prussia, which, however, is not the least prosperous portion of the German Empire. The Prussian figures showed that the proportion of households where £15 or less a year (or about 18s. per week) was brought in, was about 60 per cent. of the whole, against which Mr. Rowntree's figures showed 30 per cent. up to 30s. per week. Turning to the dynamics of the question the Blue-book showed beyond all doubt or cavil that the increase in the wages in this country had been greater than either in France or America. He would leave them out. Comparing England with Germany he showed them whereas in England, the wages of the skilled artisan had riser-from 29s. 2d. in 1886 to 36s. in 1900, or an advance of 6s. 10d., in Germany the wages had risen from 18s. 10d. in 1886 to 22s. 6d. in 1900, or an advance of 3s. 8d. Would not the working men prefer an advance of 6s. 10d. on a wage of 29s. to an advance of 3s. 8d. on a wage of 18s. 10d.? Then figures with regard to the prices of bread and meat showed them there had 'been an enormous decrease in the prices of those commodities in this country as compared with Germany, so that not only in money wages had there been a great advance, but real wages had increased even out of proportion to the advance in money wages. Ho also applied the test of pauperism, of the income-tax, and the want of employment; and showed that conditions in protected countries wore less favourable than in Great Britain. In Germany the falling off in trade had been so great that the employment of male adults had decreased between June, 1900, to March, 1901, by 10 per cent. No such decrease had taken place in this country, although trade was much worse than it was throe or four years ago. In all this there was evidence of a greater advance in this country than in Germany. In regard to the increase of exports a general statement had been made that protectionist countries were increasing their exports more quickly than free-trade countries. He challenged that statement, and taking the cases of New South Wales and Victoria, and Sweden and Denmark, he showed that the free-trade countries, or countries which imposed a moderate tariff, had made greater progress than those which were more protectionist. He applied another test. He divided the nations of Europe into three categories—those which were free-trade countries, as England and Holland; those which were moderately protectionist, as Germany. Norway, Belgium, and Switzerland; and those which were highly protectionist, as France, Spain, Italy, Austria-Hungary, and Russia. Taking figures for these three groups, he showed that whereas the increase of exports in the first group, between 1892 and 1900. had been £128,000,000, in the second group the increase had been £114,000,000, and in the highly protectionist countries it had been only £60,000,000. These figures showed that the high protectionist group had advanced the least of the three, although they had a vastly greater population. Taking the imports, he said there had been a decided advance on imports, both of the free-trade group and the moderately protected group, but a very small increase in the highly protected group.

The figures showed beyond all question that if they wanted to increase exports, they must at the same time increase imports. That stood theoretically and to commonsense, while at the same time the figures proved it practically. Per head of the population in the free-trade group the figures were in 1882, £7 12s. 6d.;. and for 1900, £9 4s. 6d. For the moderate protection group in 1882, £4 10s.; and in 1900, £5 1s. For the high protection group in 1882, £1 15s.; in 1900, £1 14s. So that there was a large increase in the free-trade group, a moderate increase in the moderate protection group, and an actual decrease in the high protection group. Those figures disproved the benefits of protection, at any rate of high protection to the export trade. He must say in regard to this matter if they took an intermediate period, from 1880 to 1900, it would put a somewhat different aspect on the question. In that period the exports from the moderate protection group advanced more than from the free-trade group. In that moderate protection group Germany was the greatest factor, and in the free-trade group the United Kingdom was the greatest factor; and it was perfectly true that the German exports had gone ahead to a larger extent than ours had done. Why was that? During the last ten years Germany had had a lower tariff on food products than in the preceding ten years. The exports from Germany in 1830–4 amounted to £3 2s. 9d. per head of the population; in 1895–9 they were£3 10s. 7d.; and in 1900–2 they were £4. In the United Kingdom the exports per head were 1890–4. £6 2s. 11d.; 1895–9, £60s. 4d.; 1900–2. £6 13s 6d., He had excluded ships from these figures, and there was nothing alarming about them. We had advanced less in the earlier period, but more in the comparison between 1895–9 and 1900–2. The point was this: that both countries had progressed, but Germany a little more than the United Kingdom; but to anyone who said that this was caused by the moderate protection of Germany, he would point out that in the same period Holland, which was practically a free-trade country, advanced more than Germany, and that Denmark advanced more than Sweden. Under these circumstances it was perfectly impossible to put the Gorman advance down to protection. There were many other reasons which might account for that advance. There was the policy of cartels, and of dumping; there was the fact that Germany had a better education than we had, and although that argument had been sneered at, it was of the utmost importance, for an analysis of the exports of Germany showed that the increase was in those trades generally where education told. Then there was the cost of transport, about which Germany had done so much, and we so little. There was further the commercial energy and adaptability of the Germans as compared with Englishmen. These were sufficient reasons to account for the difference without going to the question of protection; and we could imitate Germany in these three latter directions. It should be remembered that Germany was now going to raise her tariff, and that would increase the cost of her food. Under her new tariff he therefore did not dread the competition of Germany as much as before. In his opinion the whole protectionist argument would fall if it were not for Germany. It was absolutely contradicted by the experience of other countries, and in the face of the waste and friction which would follow any change would it not be folly to alter our fiscal plans? Especially was this the case, because if we were to imitate Germany we should have to tinker with the tariff every few years, and he asked any Member of Parliament what time there-would then be for this House to deal with other affairs.

He had tried to meet the case for protection fairly and squarely, not by wise saws or musty shibboleths, but by modern instances and concrete facts. He should leave this question uncompleted if he did not refer to the dynamics of protection which had an important bearing on the question. The Prime Minister had told them in his pamphlet that Germany, America, and France had shown "no sign of any wish to relax their system." For the moment he admitted that that was correct; but how about the future? Did we not often mistake tendencies as continuing tendencies when they had reached their climax? He ventured to give the simile suggested to him by the recent extraordinary speculations in cotton. A week ago the price of cotton had reached its highest, and the tendency to increase looked like continuing, but to-day the markets were lower. So, he maintained, that when the protectionist tendency was looking the strongest he was inclined to think that a change was coming. He would give his reason for thinking so. The real question which every nation had to solve was: what is their ideal? Was it to be a self-sustained kingdom or empire, or was it to increase the foreign export trade? In the extraordinary jumble of reasons given to the country for protection last autumn and winter, these two ideas had been both put forward and inextricably confused. But they were antagonistic and distinct from each other. There were some nations which showed considerable muddle-headedness in mixing the idea of being self-contained and the glory of an increase of foreign exports. If they wanted self-sustenance they muse regret foreign exports; if they wanted to sell to another nation, they must buy from it. Any other theory would land them in the hopeless quagmire of the old mercantile theory. If they went in for self-sustenance they must impose high duties, and if for foreign exports they must impose low duties. When Germany raised her tariff it was done at the behest of the agrarians. He asked would it last? At any rate there was very grave doubt about it. Count Caprivi was congratulated by the German Emperor as the saviour of his country in 1891 when he reduced the price of food. Ho believed that Germany was more likely to retrace its steps than to go on with the present system. The German ideal was a foreign export trade, but she could not increase that by unduly increasing her Tariff. The ideal of France was to be a self-containing empire, and she had the means for that while her population was not progressive. The ideal of the United States seemed to be rather an increase of foreign exports than a self-sustaining empire. Mr. Schwab's ludicrous boast about never blowing out a single blast furnace for pig-iron in the United States had been falsified, and the production of pig-iron in that country was little more than 50 per cent. of what it was twelve months ago. If the tendency in the three protectionist commercial nations was not to increase, but to lower tariffs, would it not be well for us to wait and see what was to happen. Were we sure that we were not better off with our elastic system, with many small trades, rather than dependent upon two or three great trades? The magnificent edifice of British commerce founded on the rock of free competition had withstood the storms of fifty years, and still towered above that of all other countries, and was the envy and admiration of the world. It was better fitted to meet the winds of hostile tariffs, because its master-builders had so fashioned it that in addition to the stately halls of greater trades, there were endless smaller rooms devoted to minor industries. He wished to say that while we ought to watch and be careful of our woollen, cotton, and iron trades, he was not inclined to sneer at the fact that we were successful in the manufacture of jams and pickles. What was our ideal? A self-sustaining empire or an increase in our foreign exports? Sometimes they were told one thing, and sometimes the other Our ideal had been free trade in every portion of the Empire which we ourselves controlled; free imports to our self-governing colonies, and to foreign nations also, not for their benefit, but because that by this policy we did better for ourselves. He thought it would be a sorry day if we threw our weight on the side of protection. As it was the scales were comparatively evenly balanced, and our example might alter enormously the dynamics; it might inevitably tend to the further closing of foreign markets. On the other hand patience and well-doing in the policy under which we had become the most prosperous nation of Europe would mean, he believed, that before long the lessening of protective tariffs now raised against us would leave us the ultimate command of tire neutral markets of the world. Therefore, in the interests of the country to which he belonged, and of the Empire which he loved, he should vote with heart and soul for the Amendment of his right hon. friend.

SIR M. HICKS BEACH (Bristol, W.)

The subject before the House is so large, and its scope so wide, that I think we must all feel that it is absolutely impossible to deal with it fully in the course of a single debate, and, therefore, I cannot but express a feeling of regret that, while it was yet new in the minds of our countrymen, this House could not have been afforded an opportunity of discussing it. I think in those days we might have been able to deal with it without an absolutely Party bias, which perhaps now has become absolutely impossible and I feel that all the more because, although the right hon. Member for Montrose took, I think, much the same view that I do, that it ought to be possible to dissociate it from Patty feeling, vet in the very form of his Amendment he has compelled us to consider it in connection with the Party to nich we belong. This subject has nothing to do necessarily with the Address in Answer to the Gracious Speech from the Throne. There is no mention of it in the Gracious Speech, and surely those who most desire that our present fiscal policy should continue will not complain of that omission, There is nothing, so far as I am aware, in the Question which will impair "our effective deliberation on the financial service of the year." Nobody supposes that, assuming this Parliament continues in existence the finance of the year will have anything to do with the new fiscal policy. I notice that, although I suppose the right hon. Gentleman is the author of the phrase I have quoted, he did not attempt to justify the inclusion of it in his Amendment. No, Sir, I do not understand why the right hon. Gentleman could not accept the invitation of the Home Secretary and delay the discussion of the question until the Prime Minister-whose absence every man in the House regrets, was able to speak on it in behalf of the Government, and until the right hon. Gentleman and those who agree with him could obtain the unbiased opinion of the House upon the Motion itself without any reference to the Party to which we may belong. The right hon. Gentleman has chosen another course. Last year the Opposition, though invited, wisely, as I think, refrained from bringing forward this question in connection with a vote of censure on the Government. Why have they adopted a different course now? I do not think that an Amendment to the Address is quite the same thing as a vote of censure, but practically it is, if carried, an expression of no confidence in the Government of the day, and would, according to our ancient custom, practically involve a change of Government. There may be this reason. Since we met last session His Majesty's Government have declared their policy upon the fiscal question. The Opposition may disapprove of that policy, or they may disapprove also of the position which, in their opinion, His Majesty's Government may have seemed to take up with regard to—what shall I say?—the mission which has been undertaken in the country by my right hon. friend the Member of West Birmingham. Now, I differ widely in this matter, and, so far as I know, in this matter only, from my right hon. friend. We regret the necessity of his absence from this debate, but in his absence I may safely say that there is no one in this country, who through his ability, his eloquence, his energy, and his service to the State, has more won the confidence of his countrymen than my right hon. friend.

I think I shall not be wrong in assuming that the determination of the light hon. Gentlemen opposite to insist on bringing forward this matter in the manner to which I have ventured to take exception is due to the cause to which I have alluded. [An HON. MEMBER on the OPPOSITION BENCH: What cause?] First it is their objection to his policy; and, secondly, the manner in which, in their minds, His Majesty's Government have associated themselves with the mission of my right hon. friend. On the opening day of the session, the Leader of the Opposition said that in his opinion the action of the Government in this matter had been the greatest imposture that had ever been foisted upon the country and upon Parliament. I wish he had reserved those words until the Prime Minister, to whom, of course, they mainly referred, had been in his place. But I will try as an independent Member, perhaps, sitting where I do, more biased in favour of the Government of the day than the right hon. Gentleman, to place before the House what I think is a fairer interpretation of the conduct of my right hon. friend. Sir, my right hon. friend the Prime Minister has not concealed the fact that personally he is in some sympathy with the policy of colonial preference. I regret that view, but we are all entitled to our individual opinion. But my right hon. friend has recognised his responsible position, as Prime Minister of the Crown, for the welfare of the Empire, and, as Leader of one of the two great Parties in the State, for the unity of the Party which he leads. My right hon. friend has recognised the limits and established the limits within which he considers the policy of his Government ought wisely and properly to be confined. He has stated, I think plainly, to the country what that policy is very possibly at some sacrifice of his own opinion. He has been rewarded by calumny and by innuendoes to the effect that he has abdicated in favour of my right hon. friend the Member for West Birmingham, and that he is a mere tool of my right hon. friend. That has been said all over the country. And that is his reward. Now, in my humble opinion, my right hon. friend has taken a course in this matter worthy of his high position and if he has sacrified his own opinions in any degree for the sake of Party unity, why, Sir, I can remember any time within the last ten years that influential writers and speakers on the Opposition side have begged right hon. Gentlemen and noble Lords on their side to do the same in the interests of the Party to which they belong. That has been the position taken up by my right hon. friend.

But there are words in this Amendment as to "conflicting declarations from His Majesty's Ministers," and I feel there is some justification for those words. I have seen with regret during the last few months that members of the Government, finding it necessary to speak, and in some cases to speak often on this subject, have not taken the course which their chief has taken, of explaining their policy and justifying it from both sides, but have gone on to declare themselves admirers, if not followers, of the policy of my right hon. friend the Member for West Birmingham. I think that was unfortunate; I think it was hardly fair to the chief under whom they serve. I think it would have been better perhaps if those who deemed it necessary to express such opinions had taken the manly and straightforward course of my right hon. friend the Member for West Birmingham and gone out into the wilderness to preach the new fiscal gospel. But I do not apply any language of that sort to the speech which we have listened to tonight. We could all have preferred that in answer to the right hon. Member for Montrose the Prime Minister himself should have stated and explained the policy of the Government. That could not be. It is no fault of the Prime Minister, but, in his absence, that duty-was undertaken, no doubt at the request of his colleagues, by the Minister who is in very close relation with the Prime Minister, and probably knows everything in his mind, and who himself represents that Department of the State which is charged with these particular affairs. I heard with the greatest satisfaction the speech of my right hon. friend. What does my right hon. friend say? First of all, he put aside that peculiar notion which, as far as I know, has really not been spread abroad by anyone in authority, that this country is on the brink of ruin. Secondly, he reiterated the declaration already plainly made by the Prime Minister at Sheffield, that taxes on food are not included in the policy of His Majesty's Government. Thirdly, he stated that the duty averaging 10 per cent. on manufactured and partly manufactured goods is also excluded from that policy, that the policy of His Majesty's Government is only the policy of retaliation, and that the issue at the next general election, whenever it may come, will only be that policy, and that the result of that general election, if it should be favourable to His Majesty's Government, would not entitle it to carry out the policy of colonial preference. My right hon. friend clinched the matter by de- claring himself opposed to protection, no doubt on behalf of the Government. He stated that in his opinion protection was not a wise policy, and he explained that by protection he meant the imposition of a tax on the consumer for the benefit of the producer.

Now, I would appeal to my right hon. friend the Member for Montrose Burghs what his object is in desiring to censure the Government. To me, at any rate, who am a supporter of the Government, the declaration that we have heard to-night is completely satisfactory. Of course, it is possible that hon. Members opposite may consider that they see the cloven hoof of protection in the policy of retaliation. If that be so, no doubt they will persevere with their Amendment, and it would be perfectly fair of them to do so; but I venture to say that it is not an issue which will meet with the acceptance of the House or of the country. I was glad to hear the President of the Board of Trade express his agreement with the Duke of Devonshire in a view which I have always personally taken from the day on which I read the speech of the Prime Minister at Sheffield—namely, that the policy of retaliation is not a step towards the policy of the right hon. Member for West Birmingham, but is absolutely opposed to it. In the course of his speech the rigid, hon. Gentleman the Member for Montrose Burghs quoted the speech of the noble Lord the Under Secretary for Foreign Affairs, and my noble friend explained what he meant by his words. I think that the House quite understood. I think that the object of His Majesty's Government and the object of the right hon. Member for West Birmingham were at the commencement the same. I believe the object of both of them was to increase our export trade, and a very goods object too.

But the methods, as my noble friend said, which His Majesty's Government have adopted with that view and the methods of my right hon. friend the ex-Colonial Secretary are different. The method of His Majesty's Government is the method of retaliation. What they want is to get as much as they can of our manufactured goods into foreign countries. They propose to negotiate with foreign countries, and, if negotiation cannot be carried to a satisfactory result, to threaten them, and if necessary to impose retaliatory duties against the goods of these foreign countries in order to effect their object; and when that object is effected these duties will come off. But the method of my right hon. friend the Member for West Birmingham is a different one. What my right hon. friend proposes is, first, colonial preference, or, in other words, the imposition of duties in this country upon the foreign goods which we most require; and, secondly, a general tariff upon manufactured or partly-manufactured goods averaging 10 per cent. coming from all countries, whether protective or not and of course to be permanently maintained. That is a totally different method from the method of the Prime Minister. With regard to the policy of retaliation—is that policy necessary or not? What is the grievance? I was glad to hear that the right hon. Gentleman in moving his Amendment admitted that the state of of our industries was not all we could desire. [Mr. JOHN MOELSY: Hear, hear.] Surly it will be agreed by all of us that foreign protective tariffs have injured, and in some cases seriously injured, our trade, not only in our export trade but in our home markets. Surely it will be agreed by all of us that if we can induce foreign countries to lower those tariffs we shall be acting in the real interest of freer trade, and conferring a benefit on the world. I do not think that it will be denied by anyone that if we could do this, as was done in the Cobden treaty, by lowering our duties here that policy would be one which would be supported by the House and the country. I am not sure that by some process of lowering or readjustment of our present duties, such as those, for example, on wines and spirits, something of this kind might not even now be done. But of course the question really is whether you should raise or impose duties in order to carry out this policy. Well, that is a question of the balance of advantage and disadvantage. I can conceive cases in which it would be absurd to undertake such a policy; I can conceive other cases, and not a few, when the advantages of the policy would be greater than its possible disadvantages. What has the Prime Minister said? He has said that he does not contemplate entering into a general tariff war or adopting the foreign system of maximum and minimum tariffs. He has said that we might tell any foreign country which we thought was treating us with outrageous unfairness that unless they modified their tariff to our advantage we should feel ourselves compelled to take some steps with regard to their exports to us which they would not like, provided that we could do it without disadvantage to ourselves. Well, is not that a reasonable policy?

MR. JOHN MORLEY

What steps? The whole point is, what steps?

SIR M. HICKS BEACH

What steps? Is it not clear, Sir, that as His Majesty's Government do not contemplate what may be called dealing with this matter by a general tariff, but dealing with it in individual instances, it is impossible for them to state precisely beforehand the particular steps which they would have to take? Would you ask a doctor to write out the same prescription for all his patients? I have no doubt that we shall have, before the country is asked to pronounce on this matter, some clearer statement than we have yet received as to the particular steps that might be taken; but I wish the House to note on this point that to-night my right hon. friend the President of the Board of Trade distinctly recognised the extreme difficulty of taking such steps with regard to those imports of food and raw material the cheapness and abundance of which are absolutely necessary to the welfare of the country, and that, further, he distinctly stated, on behalf of the Government, that they do not contemplate taking action in this matter by the imposition of retaliatory duties without the authority of Parliament. Those are statements which to my mind are extremely satisfactory, and I do not think that we could fairly ask His Majesty's Government at the present time to go beyond them.

Well, but I would appeal to the right hon. Gentleman the Member for Montrose Burghs himself. I was glad to hear that he said that if a case of outrageous unfairness on the part of any foreign country against us could be adduced, and Parliament were satisfied of three things (1) of the fact, (2) that reprisals would stop it, (3) that those reprisals would not do us more harm than good, then he practically pledged that side of the House—[HON. MEMBERS: No, no!]—he practically pledged that side of the House to support His Majesty's Government on such an occasion. I am glad to note that as a distinct advance towards the policy of the Government. There was a case not very long ago of outrageous unfairness in the case of the action of foreign countries with regard to bounties on sugar and the mode in which those bounties and protective duties were utilised—outrageous unfairness to the sugar producers in our Colonies and to the sugar refiners in this country. That was the fact. Reprisals were suggested, not by us, but by other countries, as the means by which that unfairness might be stopped—reprisals in the shape of a prohibitory duty upon all bounty-fed sugar imported into any country signing the convention. I think it is perfectly clear that that policy has not done this country more harm than good. [Mr. LOUGH, (Islington, W.): Great harm.] Well, I wait for proof of that statement. I do not believe that proof can be given, at any rate it was not given last year. But practically all the Opposition voted against the Sugar Convention. I congratulate the right hon. Gentleman on his advance. Of course I can understand that the view of the right hon. Gentleman may be that retaliatory duties if imposed must necessarily remain and become protective. Well, I do not think that is a fact, and I will again refer to sugar to show why. What was the case with regard to the confectionery and jam-making trades in England? They were practically bounty-fed, because, through the operation of foreign bounties on sugar, they were accustomed to get, and they were nourished by getting, their sugar cheaper than the cost of production. It is the same thing as protection.

A couple of years ago the Government of the day, anxious, I think, to promote the true interests of free trade—that is to say, to promote the natural course of trade—agreed to the Sugar Convention. These trades protested. They said they would be ruined. They have not been ruined yet. But the sugar bounties were abolished in face of their protest, and, therefore, I do not believe that any single interest, if temporarily protected by a duty imposed for the purpose of retaliation, would prevent its repeal in the interest of freer trade. Some say that the policy of retaliation is impracticable—that it is doomed to fail, because in certain other tariff wars it has not succeeded. I attach the greatest importance to this fact, which came before my notice most plainly in the negotiations with regard to the Sugar Convention—that all European countries attach enormous importance to admission to our markets. I have not the slightest doubt that, if they entertained any real fear of exclusion from our market, their temper towards us in tariff negotiations would be much more agreeable than it has been under the present conditions; and in those negotiations we should be backed up by what I believe to be an increasing feeling and knowledge on the part of consumers abroad of the enormous mischief that these protective tariffs and bounties do. That was perfectly clear in all that happened with regard to the conference which arrived at the Sugar Convention, because the real motive power in that convention was the disgust of the taxpayers and the consumers in France and Germany at what they had to pay to the sugar refiners and others engaged in the sugar trade. I want this policy to be tried. I believe it is in the interests of free trade that it should be tried, and I am glad that His Majesty's Government have announced their intention of trying it. One thing only I would say—I should like them to try it at once. The principle of it was tried in the Sugar Convention, and I venture to say that it has been assented to in that Convention by this House and by the country. I do not quite see why we should wait for the general election to try it in another instance. I fancy there are negotiations now going on with certain foreign countries with regard to commercial treaties, and if the right hon. Gentlemen on that Bench will only put their foot down in this matter and will deal with those negotiations on such a principle they will have no warmer supporter in this House than myself.

There is one thing I should say, however, that you must dissociate this matter from the question of colonial preference. In my belief the two things, under certain circumstances at any rate, would be found incompatible. What is the principle of retaliation? Surely, that you should treat other countries as they treat you. What is the principle of colonial preference? Surely, that you should treat a colony better than any other country, because it is part of the Empire. How are you to work the two things together? Now let us see. Suppose 2s. a quarter were imposed upon all corn coming from the United States, and Canada was exempted from that duty. Suppose the result was what those who would promote colonial preference desire—that a great deal of our corn supply were to come from Canada instead of from the United States, and suppose that the corn growers in the United States induced their Government to propose to this Government that if they would remit the 2s. duty on United States corn they, the United States, would remit certain of their protective duties which pressed most hardly upon our manufactured goods, and the remission of which would do enormous benefit to the trade and commerce of this country. What must the answer be under colonial preference? Surely this, "Our word is pledged to Canada; we cannot remit the duty." Yet the offer from America might be infinitely more valuable to our trade and industries here than anything that Canada had given in return for preference or could possibly give. Would not that be a dangerous limitation to the freedom of bargaining which His Majesty's Government desire to resume with reference to this matter? Would it not excite bitter feelings in this country on the part of those interested, whether as employers or workmen, in the industries which might be enormously benefited by the remission of these United States duties. Would that tend towards the unity of the Empire? I am afraid it would be found in working that difficulties of this sort would constantly and continually arise. I would say this. It is a very inconvenient thing to bind this country by treaty not to impose duties; but it is something more than an inconvenient thing to bind this country by treaty not to take off duties in circumstances which no man can possibly foresee.

What are the duties which, under the scheme of my right hon. friend the Member for West Birmingham, would have to be imposed? Their object is avowedly to hinder the importation of foreign goods—the foreign goods which we require—into this country, and so far to undo the effect of the millions which we have spent in our ships, our railways, our docks, and our post office and telegraph system in order to promote the freer and cheaper transit of goods. And, Sir, what is to be the result? In the words of my right hon. friend the President of the Board of Trade, the result will be the imposition of taxes on the consumer for the benefit of the producer which he describes as protection. It would be grossly unfair to compare the duties which are proposed by my right hon. friend upon corn and flour and meat and dairy produce with the old protective duties. They could not possibly have the same effect as the old protective duties, which were deliberately intended to keep everything foreign out of this country. But that is not quite the case with regard to the average 10 per cent. on manufactured and partly manufactured goods. I am afraid it would be found that there would be a very real protective effect with regard to manufactured goods as a result of those duties, and that effect would be shown in largely raised prices to the great injury of all consumers, especially in the working classes. The smaller duties are proposed to give a preference in point of money to the home producer or the colonial producer. If they are found to be not enough to give that advantage, why the principle has been accepted, and you will never be able, if you are to act in harmony with the Colonies, if you are to satisfy the clients of my right hon. friend the Member for Sleaford, and they are pretty greedy clients, you will never be able to resist the demand for an increase, and the day will come, as it has come in all other countries that have begun this course, when those duties will be as protective as the duties on manufactured goods. There are curiously contradictory arguments used in this matter. I have been told by my right hon. friend the Member for Sleaford that these duties on corn, meat, and dairy produce will not increase prices.

MR. CHAPLIN (Lincolnshire, Sleaford)

The price of bread I said would not be raised.

SIR M. HICKS BEACH

The right hon. Gentleman says so now, but then he goes down and tolls his farmers that they will largely benefit by these duties. I want to know how? Sometimeus we are told that a tax on manufactured goods will keep foreign manufactures out of the country and give more employment to our workmen here. At other times we are told that the same duties on goods coming from foreign countries will produce an enormous revenue. Well, they cannot do both. When my right, hon. friend says that these duties on agricultural produce will not raise prices, then I will ask him to explain why he does not press for duties on maize and bacon? Because they would be very useful in the present growth of public expenditure; and why, if they will not raise prices, is it suggested that the working classes should be compensated for them by a reduction of the duties on tea and sugar, the greater part of which, I am afraid, from my own experience in the reduction of duties, would probably go into the pockets of the producers or dealers in those articles rather than into the pockets of the unfortunate consumer. Everybody who has had to deal with taxation knows that it would be much more easy to reach the consumer by imposing a duty than to relieve him by taking it off; but I am quite unable to understand how, if prices are raised here by these duties, practically meaning that all of us, the richest and the poorest, will get less for our money, the result can possibly be to stimulate the productive power of the country and to increase employment.

It would be wrong of me, after the kind way in which the House has listened to my observations, to attempt to deal with statistics, or go into detailed argument; but this I will venture to say, that, though I would not for a moment contend that there are not factors that enter into the comparative position and welfare of the working class population in the various countries of the world besides protection and free trade, yet this, I think, is clear from the Government statistics—that in this country employment is more certain and more regular, wages are better, and hours are shorter than they are in protected countries. But, Sir, I know that the proposals to which I am objecting were not originally introduced, although they have recently been defended by protectionist arguments—they were not originally introduced by my right hon. friend the Member for West Birmingham on that ground alone. He brought them forward because he believed that only by increasing our trade with our Colonies could we counteract the evil influence of foreign protectionist tariffs on our exported manufactured goods; and, secondly, that by increasing our trade with our Colonies, we should do much to promote the unity of the Empire. If the policy of His Majesty's Government is successful of forcing foreign countries to lower their protectionist tariffs against us, I do not think there will be any reason for artificially stimulating our trade with our Colonies. It is very good, it is rapidly increasing, and I think it will take care of itself. But I admit the strength of the sentiment which underlies the second argument of my right hon. friend. My right hon. friend the other day, asked us to think Imperially. [OPPOSITION laughter.] I should not receive that suggestion with derision. I am quite sure that my right hon. friend did not mean for a moment that he contemplated the idea of a self-sustaining Empire. The thing is an impossibility. It is a Chinese idea. It would be a fatal check to all prosperity, and, politically, and nationally, it would be dangerous. It is of vast national importance to us that foreign countries should be interested in our foreign trade. Why, Sir, cannot we conceive circumstances in which the great interest on the part of that great Power on the other side of the Atlantic to prevent food being declared contraband of war might be of enormous importance in a great national crisis? No, Sir, I am sure my right hon. friend never contemplated the ideal of a self-sustaining Empire. What he did contemplate was a great increase of trade with our Colonies which would conduce to the unity of the Empire. I think the enthusiasm for the Colonies of my right hon. friend has sometimes led him to go further than I should be disposed to follow him in this matter. He said the other day that the future of the country and the British race lies in our Colonies and our possessions. Sir, I think it lies here. We, at any rate, are primarily interested in the United Kingdom. The interests of the United Kingdom are the greatest interests in the whole Empire.

But, Sir, in considering this matter, we are bound to consider, not only the interests of the United Kingdom, but also the interests of the Empire. And what are they? The idea of colonial preference—the principle of it—has been supposed by a sentiment to which I attach enormous value. I do not think anybody can exaggerate the important service which my right hon. friend the Member for Birmingham has done to this country and to the Empire both here and in the Colonies. But we cannot deal with these matters by increasing sentiment alone. Suppose the principle accepted. When we come to details we may be quite certain that the Colonies will deal with them in a spirit of hard prosaic business, and expect us to do the same. Very well. Now, I recognise and admire the spirit in which this matter has been dealt with so far by the Colonies. They have said to us plainly, "Don't hurt yourselves in order to benefit us." Their whole tone has been that of a speech, which I read the other day, from one of the Canadian Ministers, who protested against Canada being pictured as a squalling infant clamouring for preference, and saying that if she did not get it she, would break up the family feast and have the Empire. All that the Colonies have ever expressed a desire for in this matter is a fair bargain. Now, what are the proposals before us? My right hon. friend has made these proposals—5 per cent. on corn, a higher duty on flour, a small duty on meat and dairy produce, colonial produce to be admitted free in competition with our own farmers, just as it is now. What has he got on the other side? As yet he has had no definite offer. We hear a good deal about offers by the Colonies. I do not at all deny that the Colonies would desire to enter into bargains with regard to colonial preference; but when we want to know, as we must know before we adopt the principle, what they will give in return, we get no answer. My hon. friend the Member for Sheffield has said that Canada has already given 33 per cent. Does my hon. friend really believe that that 33 per cent., although I admit of great value as showing the kindly feeling of Canada towards us, has done any material good to our country? ["Yes."] Then, how does my hon. friend account for this fact—that since this preference has been given, the whole trade of Canada having greatly increased, the trade of Canada with the United States, with France, and with Germany has increased more in proportion than the trade with Great Britain? To make any fair bargain in this matter what would unquestionably be necessary would be a real measure of free trade to us in colonial markets in the only things which we can export to these markets—namely, manufactured goods. Now, has any colony ever offered that? No, Sir. All of them tell us, and my right hon. friend the Member for West Birmingham has never been able to produce the slightest evidence to the contrary, that they will protect their manufactures against us. Is it a fair bargain that colonial products should come into this country free, while our products cannot go into the colonies except under protectionist tariffs? Let me carry this matter further. There may be something worse. There is a question which has never yet been answered. You propose the imposition of a duty averaging 10 per cent. on manufactured and partly manufactured goods. Is that duty to be applied to colonial imports or not? I do not hear an answer. If it is to be levied on colonial imports the principle of colonial preference is gone. If it is not to be levied on the colonial imports, in the first place you will lose an enormous proportion of the revenue which might be derived from such a tax by frauds of certificates of origin and by exportation of foreign goods to the Colonies in order that they may be sent by the Colonies here, which would be much easier now than it was before owing to the cheapness of freight. And you will do something more. Our manufacturers here complain bitterly of the unfair competition in our markets of German and United States iron, for example, under their protectionist system. Very well. There is a bounty upon iron in Canada. We all hope and expect that the industries of our Colonies will increase and expand, and rival at some day or other the industries of the mother country. Will Imperial sentiment reconcile our manufacturers here to be ruined by bounty-fed or duty-fed colonial goods any more than they are now reconciled to being ruined by similar goods from foreign countries? These questions will hive to be answered before any practical action can be taken, I will venture to say, with regard to a discussion with the Colonies upon colonial preference. And there is something more. We are told that colonial preference, assuming it not to be intended on manufactured and partly manufactured goods, is to be confined to food, to corn, meat, and to dairy produce. Is that so? [A Voice: "No."] I look for an answer to my right hon. friend the Member for Sleaford. But assuming that to be so, is that likely to satisfy the Colonies? Do not we all of us know that that really will only apply to certain interests and to certain Colonies? Do not all of us feel that, for example, the timber interest in Canada will have something to say why it ought to have a preference which would be denied to it when given to the corn growing interest? Do not we feel that South Africa, which has granted us a preference, sends no food at all and sends a mere trifling amount of wine, but does send a great deal of raw material? Do not we know that the great export of Australia to this country is not food or meat, but raw material? If you are to adopt this principle of colonial preference, and if you are to do justice to all the Colonies and all the interests in those Colonies, without which your preference will be a mere beginning of jealousy and friction in the Empire, you must extend it to raw material. And when you once extend it to raw material, what will the woollen industries of Bradford, what will the building trade of this country, have to say to colonial preference?

I feel that this matter is one of such enormous importance that I will not apologise for having trespassed for so long upon the House. I am opposed to the proposals of my right hon. friend the Member for Birmingham on principle. I believe they are wrong. But let us consider them for a moment from another point of view. Put aside their merits altogether. They involve an enormous change, everybody will admit that, in our fiscal system. It is a change which surely, if adopted at all, ought to be adopted with a reasonable assurance of permanance. I think my right hon. friend the Prime Minister dealt with the matter in his speech at Manchester in a spirit of the highest wisdom. I will ask my right hon. friends who desire it to put aside the merits altogether. They will surely agree that unless this change can be permanently made it will be dangerous in the last degree to the interests of the Empire to make it at all. Now, is there anything behind this proposal representing that body of fixed sentiment and conviction which is the only sure basis of any great change? Not yet. Then, Sir, is it not wiser that we should adhere to the policy of the Government, that the attempt which has been made to pledge the whole of the Unionist Party to the policy of my right hon. friend the Member for Birmingham should be abandoned, and that the matter should be considered at leisure in the country, not for the next election, nor for by-elections, not for anything of that kind, but should be considered and discussed until one way or the other a definite and fixed conviction is arrived at? Sir, I plead strongly because I believe in the vast importance of this question. I am not a bigoted free trader. If I had been I should not have been responsible for violating the pure theory of free trade by proposing the corn duty two years ago. This country is prosperous; but I know very well that that prosperity is not universal. There are interests which are not prosperous—the agricultural interest first of all. Other countries have prospered under protection as we have prospered under free trade. But, Sir, the position of this country is unique. For two generations and more, after long deliberation, we have adopted and adhered to our present fiscal policy. The result of that has been greatly to increase our wealth, greatly to increase our population, to make us in this hemisphere at any rate, the greatest commercial, trading, and industrial community; to turn us, as has already been said, from an agricultural into an industrial country. And all this has brought about this thing in which this country is unique—that we depend mainly for our food supply, for our supply of raw materials which are absolutely necessary to our welfare, which we are bound—more bound now than ever—to get in the best and cheapest market, we depend for them upon an over-sea supply. To reverse the policy under which we have come into this position, to return, in principle at least, to something like our old tariff, embracing hundreds of articles, harassing and interfering at every point with the trade and industry of the country, is an experiment to my mind full of the greatest danger to our social and political future. If any such proposal were made to this House I should not hesitate for a moment as to my vote. But, Sir, no such proposal is before the House. The proposal of the right hon. Gentleman does not even ask us, though it might have asked us, for a mere abstract assertion of the benefits and importance of free trade; he has inextricably combined with that the question of confidence in the Government of the day. I should not under any circumstances desire to replace His Majesty's present Government by right hon. Gentlemen on the opposite Bench. But I will never desert the Government of my country at such a crisis as that which may, perhaps, at this moment be beginning in our foreign affairs. I agree with the policy which has been explained to the country by the Prime Minister, and reaffirmed by the President of the Board of Trade to-night. I desire to support the Cabinet against many, I dare say, of their own supporters who are anxious for what I consider wrong and extreme measures. And I believe that what the Prime Minister has said he will adhere to, and in that view I shall vote against the Amendment of the right hon. Gentleman.

MR. HALDANE (Haddingtonshire)

said the right hon. Gentleman who had just spoken was not only a great financier, but one of the most fascinating personalities in the House, his fascination consisting in the fact that while no man more clearly knew his mind, no man had in greater degree the art of wrapping that mind in a certain veil of mystery. The speeches of the right hon. Gentleman could never be judged by either their exordium or their peroration; the arguments in between had to be carefully considered. If the right hon. Gentleman dissented from his own side, he had the gift of dealing out his bad arguments to his friends and his good arguments to his foes, and on the present occasion the Opposition had had his good arguments. He began by expressing his dissent from the manner in which this Motion had been brought forward in the absence of the Prime Minister. All deeply regretted that absence and its cause, but it should be remembered that during the whole of last summer Members were very forbearing, and that through the autumn an agitation unparalleled in its intensity had been carried on: was it to be supposed, therefore, that the Opposition could sit silent through the debate on the Address without endeavouring to ascertain the view of the House upon the most important question that had come before it for many a day? The right hon. Gentleman knew the mind of His Majesty's Government, as perhaps no other man, and he had proceeded with the calmness of a surgeon of great experience to go alongside the patient and tender his advice. He had diagnosed the disease, and in most kindly and sympathetic tones had stated wherein the patient was suffering. The right hon. Gentleman had the gift of what theologians called exegesis, and he had explained what the House could not have known before—what the real policy of the Government was—and he had made it clear that the Free Food Party considered that in the struggle for the mind of Ministers, their exertions had not been without avail. The right hon. Gentleman had then proceeded to deal with some of the topics embraced by the debate. He had flirted with retaliation. But it was good to pay attention to a young lady in whom those whom you wished to be your friends were peculiarly interested. Such negotiations with foreign Powers would have no warmer friend than himself. He was, however, judicious as to the way these retaliatory proposals were to be carried out. With regard to Russia and the United States, our principal imports from those countries were food and raw materials, and they were the very things which they would suffer most from, if any attempt was made to place retaliatory duties upon them. The right hon. Gentleman did not pursue that topic further. In the course of his speech he expressed a pessimistic view of British trade. The right hon. Gentleman the Member for Montrose admitted that he did not find the trade of this country in a wholly satisfactory condition. He was quite unable to agree with those who found in the prosperity of the country anything which could give them complete assurance for the future. He held strongly that there never was a time at which this nation more required to make an effort if they wished to retain the supremacy which had distinguished them in the past, and which it lay with them as to whether it should remain with this country in the future.

While he was ready to admit that the right hon. Gentleman the Member for West Birmingham had done the country a service by stirring up the people on this question, yet he could not help feeling that for one service he had rendered two dis-services, for he had turned attention to the wrong remedy and away from the true remedy. It was all very well to complain of Mr. Cobden because the dream of universal free trade had not been realised. He was not so sure that universal free trade would have been such a good thing for the country. Their free-trade policy had, however, been of great assistance to something else which had enabled them to be supreme, and that was that in the old days they were first in industrial methods. He blamed the policy of the right hon. Gentleman the Member for West Birmingham, because it had drawn attention from the only policy which gave them a chance in competing with their foreign rivals, and had led them on a line which seemed to him to be altogether false. He was one of those who thought that there were great social questions to be solved in this country, and they could only be solved by a considerable amount of interference on the part of the Government of the day with people's liberties. He had read a very interesting speech which the Colonial Secretary delivered to his constituents at Leamington the other day, and which had been alluded to by the right hon. Gentleman the Member for Montrose. The Colonial Secretary, in criticising this extravagant view of free trade, asked how they could maintain a free-trade doctrine in its entirety when they wished to put restrictions upon labour at every turn. That was a doctrine which it was quite right to put forward, but which it was equally necessary to examine very closely before accepting it. That would be a very valuable argument to those who based the case of free trade upon the doctrine of unrestricted liberty. Probably Mr. Cobden had not the same occasion to consider that doctrine as they had today. He had always refused to believe in that doctrine because he should interfere with anything in which it was proved that the welfare of the people required it. Nobody in his senses would propose to repeal the factory legislation which had had such a beneficial result in the last two generations. They should maintain the power which they had to interfere for the protection of that labour which could not take care of itself, and which, by its very circumstances and for want of organisation and the feebleness of those who created it, was unable to protect itself without interference from the State. But, while that was true, it was equally true that they wanted great mobility on the part of capital and great freedom in dealing with trade.

Experience had shown that whenever they tried to judge things for those who knew better than anybody else, because it was their own business, they always failed. Whilst protecting labour it was well to leave the utmost freedom of judgment to all those who embarked in industry. If they were going to interfere in the conduct of labour and put down, for instance, some forms of sweating, which not only disfigured their great towns, but were bad for the population, at the same time it was equally necessary that they should leave the people free to replace the thing which they could no longer produce with advantage by some other commodity produced under different conditions. He was very much struck the other day by what he saw in Yorkshire in the centre of the woollen spinning industry, where a friend of his told him what had been the history of that industry in Yorkshire. Years ago there used to be a considerable weaving as well as spinning industry in that locality. But the weaving industry had now disappeared almost and there was very little of it. He thought it was a good thing it was disappearing, because it employed men at wages which never exceeded £1 a week, and it employed women who would have been better employed attending to their families at home. In that locality they were now spinning with the finest machinery. The material went first to Germany, where there was a very low duty, and a state of things had now grown up under which it was profitable for the workers in this country and in Germany to carry on business in that way. The result in the locality he referred to was that an inferior industry had been replaced by a superior industry, and instead of the old wage of £1 a week the workers were now receiving between 30s. and 40s. per week in wages. At the technical school in that locality he saw a whole generation of people growing up experts in the making of that spinning machinery, beside which there was nothing to compare in the whole world.

There were two industries which to his mind demonstrated the great peril of endeavouring to interfere with the judgment of people as to how they should employ their own resources. At the present time there was less weaving and flax spinning in Leeds and Bradford, but were they less prosperous now than they used to be? Hon. Members opposite were always lamenting the disappearance of a particular industry, but they had to look at these things in the aggregate. He admitted the hardship caused through the displacement of an industry, but free trade was not the only thing that displaced industry. Had they conceived the real meaning of this free-trade policy which they were asked so lightly to part with? It involved industrial and social questions, and their freedom to grapple with such questions as sweating and housing. There was hardly a social question which free trade did not affect. The right hon. Gentleman the Member for West Birmingham, animated by a depth of conviction which he recognised to the fullest, went through the country and pro- duced a very great impression, and yet from the very beginning it had dawned on many people that the right hon. Gentleman had not fully presented the country with all the information upon which it would have to judge the case. Unfortunately it was more complicated than the story which the right hon. Gentleman the Member for West Birmingham had told them. In the speech of the President of the Board of Trade they had just heard the result of the judicial summing up which it was the duty of a Minister to bestow on this case, a duty which the right hon. Gentleman had discharged very fully. He had carefully balanced the argument, and he had summed up in a manner which was satisfactory from the point of view of those who at any rate wished to see this policy of free trade carefully and impartially considered before it was abandoned. He was not going to summarise that speech, but it had struck him very much, because it seemed to indicate the direction in which the mind of the President of the Board of Trade had been working after reading those remarkable materials which his own officials had collected for him. His summing up of that evidence had relieved them from the fear that they were likely to be plunged in any sudden fashion in a campaign on the part of the Government in support of the policy of the right hon. Gentleman the Member for West Birmingham. In that state of things they were more concerned with arguments which came from other Members on the opposite side of the House which were more worthy of consideration, although he could not agree with them.

There were many hon. Members who did not go very minutely into the merits of this economic controversy and they pointed to the growth of other nations and to the extraordinary position which Great Britain held, with a small population as compared with the population of our Empire, and they asked how this country was going to face the growing power of those other nations unless they did something. He agreed with that sentiment, but where he differed was in regard to the means they suggested to attain it. It was said by the right hon. Gentleman the Member for West Bristol, and also by the right hon. Gentleman the Member for Montrose, that they could not keep the Empire together if they were going to make this country poorer. They could not count the economic loss which would follow the adoption of the policy suggested by the late Colonial Secretary. They could not measure that loss or know where it would leave their trade. Where such a change would land them they could not tell and they could not measure the cost. The speech made at Manchester by the Prime Minister early in January had received a great deal too little attention, but that policy was re-echoed by the Secretary of State for the Colonies. In that speech' the Prime Minister said that until a few months ago he had believed that a fiscal basis was the only basis upon which they could draw the Empire more closely together. He went on to say that he had seen occasion to change that opinion, and had come to the conclusion that in the development of the policy of councils of the Empire there was an alternative policy to the fiscal basis to attain the end of drawing the Empire more closely together. The right hon. Gentleman illustrated this by the Council of Imperial Defence, which had been in a large measure his own child and of which he was the distinguished parent. He foreshadowed this other policy of developing the councils of the Crown in a fashion which made some of them feel that they had an alternative to the Imperial policy of the right hon. Member for West Birmingham. That was a policy very relevant to the debate, and, having received the seal of responsible Ministers, it answered one of the most cogent arguments which had affected the minds of many men in favour of the policy of the right hon. Member for Birmingham. A good many people thought something ought to be done and they said to themselves "here is a man who has distinguished himself by the successful way he has pushed things through which he has taken in hand. Let us support him, although we may not be wholly convinced in his favour." Now they had an alternative policy which had gained importance, because it had received the seal of the responsible Ministers them-selves and because the Prime Minister had embodied it in a concrete case of his own, namely, the Committee of Imperial Defence. That was a very important departure, the effect of which might be felt hereafter when dealing with the Imperial aspect of the subject which formed the topic of this Amendment It could not be said that free trade was amerely negative policy, for it left open the door for a constructive policy affecting the various parts of the Empire, and it left open this policy of legislation in the direction they had followed by the passing of the Factory Acts, and which they would have to follow more in the future in dealing with the social problems which were crowding upon them. They were awakening to a sense of their responsibilities in all these matters and to a recognition of the duty which Government owed—and which was recognised by both Parties in the Stats—to the more helpless class of the community which subsisted on a mere margin of subsistence.

He was very glad that the speech of the right hon. Gentleman the Member for the Montrose Burghs contained a plea for a system of national education. This was not the moment to discuss that question, but it had taken a concrete shape in the course of the debate. Was it not the obvious duty of constructive free traders and those who, on whatever side of the House they sat, believed in the gospel of liberty, coupled with the doctrine of protection, to set themselves to work and try to get off the false track-on which we had got, and to get back to the problem dealing with the industrial methods of this country? That was oot a thing that ought to be left alone by the State to individuals. The Amendment had raised in a form which might be inconvenient the great topic which was agitating people's minds. It was perfectly true that they would not be able to get a really judicial vote upon this matter. Of course, an Amendment to the Address involved to some extent, the question of confidence. He thought questions of confidence had been exaggerated in their importance. They enabled the Government to ride off and say to hon. Members behind them "Will you, our supporters, show want of confidence in us." If the Government were really in earnest about the policy of free trade—and the speech of the President of the Board of Trade gave him good hope that a majority of them were in earnest—he, for one, marvelled why they did not attach rather less importance to the technical form of the debate on the Address and let them have the benefit of a discussion in which they should get the free mind of the House in the matter. It was quite certain that they would not get it, but to-night, and in the two or three days which were ahead, they would at least have got an examination of this whole controversy in a fashion which would give the people what they had been waiting for a long time, the mind of the House of Commons upon the subject.

MR. PIKE PEASE (Darlington)

said the right hon. Gentleman who had just sat down stated that exaggerated importance was attached to the question of confidence, but he did not think the right hon. Gentleman would make the appeal he made if in the future he was sitting on the Government Benches. Before coming into this House he had himself taken part in industrial concerns and he had had the opportunity of mixing with and making friends of working men. It was often said that Members of Parliament who were connected with manufactures were selfish in their views. He should like, if the House would allow him, to make a personal explanation with reference to this question. He had a paragraph in his election address when he first came to Parliament in favour of reciprocity, and he sincerely trusted the day might come when the propositions of the right hon. Gentleman the Member for West Birmingham would be viewed with favour by the British people. He believed there were a vast number of persons in this country who believed that it was absolutely necessary that there should be some radical change in our fiscal system, and ha sincerely trusted hon. Members would show in the remainder of the debate that moderaton which had been shown up to the present time. The right hon. Gentleman the Member for the Montrose Burghs moved the Amendment in a speech no one could possibly object to. He sincerely trusted they might put aside the bitterness which they had seen in the country during the past few months. A great flood of figures had been produced in reference to this matter. Some of these were accurate and some were inaccurate. He would not deal with the figures to-night except to say that most inaccurate statements had been made with reference to the iron and steel trade. It was stated by Lord Lytton last week that the total ad valorem value of the iron and steel trade was £140,000,000. No one who had any knowledge of the trade could believe that that was a correct figure. It had been justified by saying that the iron and steel trade included motor-cars, pots and pans, and other things. But that was no justification. It would be just as reasonable to include a violin in the timber trade. What they had to ask themselves was not so much whether our prosperity had been great in the past, or for what reason, but would our difficulties extend and increase in the future? In his opinion they were not likely to decrease. It had been said that many hon. Members were violent protectionists. He thought that was rather a hard term to use. At the present time we in this country taxed tea, and we allowed motor-cars to come in free of tax. We stood alone among the nations of the world in our policy in that respect.

Were the representatives of the Colonies in earnest when they passed a resolution unanimously in favour of reciprocity with this country? If they were in earnest what answer was this country going to give them? In the speeches to which they had listened they had heard no alternative. He thought that at no distant date the majority of the people of this country would believe it was necessary to bind ourselves to the Colonies by a commercial ties of some kind. He was not at all sure that a majority of the people of this country did not think so at the present moment, although he was not foolish enough to believe that' when an election took place in regard to this question, the Party he belonged to would have an enormous majority. [Laughter.] Hon. Gentlemen laughed at that statement, but everybody knew very well that other questions, such as education, would come to the front, and especially representations with regard to a bread tax. [An HON. MEMBER: Misrepresentations.] He preferred the word representations. He went recently to the Gateshead election and saw two loaves in a shop window—one professing to represent the English and the other the German loaf, the comparison being greatly in favour of the former. He did not know whether that should be called representation or misrepresentation, but no one believed that in this country such a tax could be put on bread as to produce the disparity represented by these two loaves.

MAJOR SEELY (Isle of Wight)

Not yet.

MR. PIKE PEASE

said his hon. friend would agree with him that there would be no great change in connection with that matter except by the will of the British people. It had been said that the prosperity we had seen during the past half-century was due to a great extent to free trade. He, for one, would not deny that free trade had played an important part in the prosperity of this country, but during that period electricity and steam had revolutionised industries. It must be admitted that times were changed. Those who had gone to Gateshead would have had the opportunity of seeing a great many works standing still in the North of England. No doubt if they travelled in tramways they would have the chance of riding along on German rails. He thought the time had come when they should have some alteration in regard to that. It had been said that we were behindhand with regard to technical education, and he believed that was true. He thought it was necessary that we should put a duty of from 10 to 20 per cent. on manufactured articles. That was very little protection, but it was common sense. In advocating such a duty he thought he could hardly be called a violent protectionist. He wished to put this case before the House. Supposing an order had to be placed for steel to the value of £100,000. A bounty-fed manufacturer offered to execute it at £99,000, while an English company, which had furnaces and everything necessary to produce the steel, quoted £100,000 Could it be argued that it would not be in the interests of this country to put a 2 per cent. duty on the bounty-fed stuff? Of course it might be said that the man who bought the steel would lose £1,000, but when they thought that the amount of labour in that large order would be £60,000 it would be seen that greater benefit would result to this country if a 2 per cent. duty were put on, especially if they took into account the fact that rates would be paid by the English order which would not be paid by the foreign order at all. It was said that if people could not find employment in a business which did pay, arrangements should be made for introducing new businesses. Anyone who had been connected with business knew that that argument was absurd, because businesses which had been started in different parts of the country had been started by an immense expenditure of capital, which if it could not be used in the business for which it was intended would be thrown away altogether. Large plants which had cost a great deal of money would have to be sacrificed at scrap price. The owners would be able to get hardly anything at all for it. It was said that the increase in the yield of the income-tax showed how prosperous this country was. It was perfectly true that there had been in Great Britain an increase of about 1 per cent., but in Germany there had been an increase of from 25 to 40 per cent. It should be remembered that a large number of men who had made enormous fortunes in the Colonies came to live in this country. He believed that in the last thirty years the amount of money that had come in from the Colonies had been from a £1,000,000 to £1,500,000,000. He thought that must have had an effect on the income-tax. It was said that this country was the envy of the world. That might be, but our fiscal system was not the envy of the world. At present there was no country willing to adopt our system. When addressing a meeting the other night in the North of England he asked the audience whether they knew of any individual enterprise which was being started in this country at the present time. There was a certain amount of municipal enterprise, and there were a certain number of limited liability companies; but as to individual enterprise, such was never seen as in days gone by. It practically did not exist at the present time. He thought he might say to the hon. Member for the Isle of Wight that a good deal of the business done in the country at the present time was due to Government contracts. The day would come when municipalities would not have the great borrowing powers they had at the present moment, and then it would be found that municipal enterprise would, to a great extent, be curtailed. He admitted that there were many arguments on both sides with reference to the fiscal question.

And, it being Midnight, the debate stood adjourned.

Debate to be resumed to-morrow.

Adjourned at one minute after Twelve o'clock.