KING'S SPEECH (MOTION FOR AN ADDRESS).

HC Deb 11 February 1904 vol 129 cc1040-104

[EIGHTH DAY.]

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."

SIR GILBERT PARKER (Gravesend)

said that when the debate was interrupted last night he was referring to the question of wages which had been raised by an hon. Member opposite, who had urged that the position of England in Europe was assured so far as its wealth and prosperity was concerned, as was evidenced by our standards of wages, living and comfort. Now he would be the last to say that those standards were not high in this country. No doubt they were higher than in any other countries—except new countries which had exceptional advantages, such as the United States and our own Colonies. But there was one statement of the hon. Member he must deal with. It was that the wages of certain skilled workmen, which in 1860 were 28s. 3d., had risen to 37s. 9d. by 1890. That, no doubt, was a remarkable increase, but he wished to point out that the increase in Germany of the same period was appreciably greater, starting from a lower standard. Was it strange that the standard should have been lower in this country? These were the days when Cobden had given this country a new and great policy, we were in an extraordinary position in the matter of our manufactures, and not in a serious position in the matter of our agriculture. Cobden then looked forward to the time when England would permanently command the manufactures of the world, for he held that the repeal of the Corn Laws would not only give a great impulse to our manufactures, but would inflict so severe a shock on our rivals by giving us augmented opportunities of competition all over the world that England would permanently maintain her position against Germany, France, and the United States. Those who held the opinion that free trade was not an unmixed blessing at all times and places had been again and again challenged because it had been said that the protectionist in America sold cheap abroad in order that he might sell dear at home. But he would like to point to the fact that America manufactured 'goods from raw material which she did not produce, and sold them just as cheap at home as abroad. Since 1824 there had been a tax on wool in the United States, which she had always had to import from Australia, South America, or elsewhere. Could any one suggest that the wages of workmen in the United States were low because the manufacturer sold his goods cheap abroad so as to sell dear at home? Take the case of tweeds. Why the United States, where twenty-five years ago there was no good American tweed, and only American shoddy was worn, now produced, in spite of the heavy tax on wool, tweed clothes as good and as cheap and as well made as any we produced in this country, and they were worn by 75 per cent. of the population of the States, while the workman engaged in making them got twice as much wages as the workman in this country. That seemed absurd on the face of it, but it sufficed to point out the moral he wished to be drawn from his remarks. The American workman, to begin with, was working in an area where he was absolutely secure, and the manufacturer commanded his home market. No doubt the. United States had great resources in her own borders which we did not possess. We had to go abroad to purchase food, a portion of which we might still be able to produce if the policy of free trade had rot pressed so heavily on the agriculture of the country. The United States had never exported so heavily as we had, neither had she imported as heavily. Her imports were £171,000,000, whilst the imports of England were £528,000,000, and her exports were £304,000,000 against our £347,000,000. But it was not reasonable to suggest that because the United States did not export so much she was necessarily poorer. The fact that her imports and exports were so well balanced showed that she was commanding her home trade. Was American-made furniture sold cheaper in England than in America?

MR. FLAVIN (Kerry, N.)

Certainly.

SIR GILBERT PARKER

I beg your pardon.

MR. FLAVIN

I beg yours.

SIR GILBERT PARKER

Were American shoes dearer in England than in America?

MR. FLAVIN

Certainly.

SIR GILBERT PARKER

said he had studied the question.

MR. FLAVIN

And so have I.

SIR GILBERT PARKER

And my conclusion is that they are not.

MR. FLAVIN

I have worn the boots and paid for them, so I know they are.

SIR GILBERT PARKER

said he had done the same. The point he wished to make was that the margin of difference was not sufficient to justify the assertion that protectionist countries sold cheap abroad in order to sell dear at home. What was the policy of Mr. Carnegie and his fellow manufacturers? Did they dump simply in order to get rid of their surplus stock—did they desire merely to make England a Cheap-jack market? No, the policy of Mr. Carnegie and the other manufacturers was first to secure the home market and to use it as a leverage by which to capture fureign markets. They kept their works going for nine months in the year in order to supply the home market, and then, instead of incurring a loss by closing for the remaining three months, and keeping their men and factories idle, they kept them running by selling the goods produced at cost price abroad. They did not sell goods cheap simply to capture the English market. They had another purpose in view. It was not the trades unions who alone secured high wages for the working men in the United States; it was the fact that the manufacturers had a settled policy, by the quantity of production, to keep their workmen employed all the year round. By the policy they adopted of selling here at cost, they were able to reduce the expenses of their establishments and to avoid the loss which would be entailed by the temporary shutting down of the works. It was not done for philanthropic motives, but it was done in order to secure regular employment for the men all the year round, and the effect on the domestic and on national life, as well as on the manufacturers themselves, was very great and good. It produced confidence and security. Let them remember that if the cart of progress was to be drawn along, and if the capital which should draw it went lame, labour alone would not draw the cart. It was the command of their home markets that ensured employment and increased wages for the working classes in the United States, and which at the same time secured the manufacturers in their position. How did we stand in the matter of our home trade? Were we satisfied that we had the absolute command of it? When he read the table of our imports and exports he could not say that the prospect was, by any means, a cheery one, He would give a few trades in which there had been a rise in imports and a fall in exports. During the last nine years the figures for the increase of imports and the decrease of exports respectively were, in the boot and shoe trade, £2,159,000 and £920,000; in woollens, £18,000,000 and £38,000,000; in furniture, £5,500,000 and £600,000; in earthenware, £2,400,000 and £15,000,000; in glass, £11,700 and £1,300,000, and in silk, £38,000,000 and £8,000,000. That was a serious state of affairs, and it was certainly not what Cobden had anticipated. Cobden looked forward to seeing the manufacturers of England commanding the trade, not only of this country, but of all others. We, however, did not expect that, as we knew perfectly well that the discovery of the great mineral resources of the United States and the Colonies had altered the course of trade with those countries. The right hon. Gentleman the Member for West Birmingham was not the first to raise this question of the decline of British exports and the increase of British imports. Lord Rosebery raised it on the basis that if we went on—the signs were so alarming—we were bound steadily to decrease in power as a manufacturing nation. If was true that merchanting was increasing every day in this country, but manufacturing was proportionately decreasing. Moreover, our carrying trade, whilst it had increased, was slowly being competed with by Germany, and if the United States made up its mind to enter the theatre of shipping, we should probably have a bad time in the future. He altogether disputed the theory, suggested by the Cobden Club, that the fact that the amount of American shipping was insignificant as compared with British shipping was a sign of a lack of American prosperity. Why did not Americans invest in shipping? Because it was much more to their benefit to put their money into "industrials," which yielded a return of 15 or 20 per cent., than into shipping, which would bring them in 5, 7, or possibly, in some cases, 10 per cent. We, for our £528,000,000 of imports, were content to send out one-third of the amount of exports, and for the rest to pay by shipping alone. He did not suggest that England's position would be better if we had less shipping; on the contrary, he considered it to be absolutely necessary to England's future that her position in the carrying trade should be maintained. He did, however, wish to point out that thirty years ago we had the same position in the carrying trade and a better position in the manufacturing world. We had lost, on the one hand, and we had not gained proportionately on the other.

Having been challenged on the question of colonial enthusiasm in the matter of preference, and as to the offer of the Colonies, he had looked the matter up in The Times, and he found there had not been a single dissentient voice from the Colonies or from any public body in the Colonies. On the contrary, every Legislature in the Colonies had expressed its sympathy with the belief in the idea of preference. The New Zealand Parliament had passed a Bill on the subject. Not only had the Premier of Australia spoken in favour of the proposal, but the Leader of the Opposition in Australia, whose form of preference might differ from that of his political opponent, had said again and again— I propose to reduce the taxes upon British goods by 50 per cent. Whatever Sir E. Barton will do, I will do more.

SEVERAL HON. MEMBERS

But he a free-trader.

SIR GILBERT PARKER

said the fact that Mr. Reid was a free-trader was a striking tribute to the argument he was addressing to the House. Sir Wilfrid Laurier also was a free-trader.

MR. YERBURGH (Chester)

asked whether Mr. Reid asked for anything in return.

SIR GILBERT PARKER

said he had expected that question. Mr. Reid asked for nothing in return. Moreover, he had looked the matter up in the Canadian papers, and he unhesitatingly asserted that the Leader of the Opposition in Canada had so far coincided with the opinion and the action of the Canadian Government that again and again he had spoken in favour of preference. As to the question of his hon. friend, who did not know the exigencies of politics, even in this country? It was extraordinary that this movement should have met with so little opposition in the Colonies when one considered how eager opposing Parties were to dish each other. They were told that a preference could be given to Australia only on wool. That was inaccurate. A preference on wool was not our last resort. By giving a preference on agriculture, on meat and wines, we should benefit Australia more than by a preference on wool, because although the meat and wine trade was not worth more than 60 per cent. of the pastoral trade, it employed 50 per cent. more hands, and thus affected the working classes to a greater extent.

His interest and belief in this scheme had led him to speak at greater length than he had intended. In conclusion, he could only say that he believed the future of this country depended upon a closer association and a common destiny with our Colonies. He felt that we could never retrieve the place we had lost in the industrial movement of Europe, but we could secure our position by a closer alliance with those nations which had supplied our trade, as it had declined with foreign countries. He believed that sooner or later preference would come, and so would a 10 or 20 per cent. tax upon foreign manufactured goods, in order to protect that trade which has been, and will be, for the prosperity of this country.

SIR JOHN GORST (Cambridge University)

The hon. Member for Gravesend, who has just made an interesting and instructive speech, is, I presume, an opponent of His Majesty's Government, because he spent one part of his speech in advocating protection, and the other in advocating colonial preference, which are both policies that the Government have distinctly renounced. When the House adjourned last night, the hon. Member was trying to show that the German workman was much better off than the English workman, although I do not think that is very relevant to the question before the House. The hon. Member has omitted that part of his argument this morning. With the official policy and declarations of the Government I, like the right hon. Gentleman the Member for West Bristol, am entirely in accord. We understood the President of the Board of Trade to say that a tax upon food was not within the sphere of practical politics, that the Government are opposed to colonial preference and general protection, and a 10 per cent. all-round tariff, and that their policy upon fiscal reform is freedom to negotiate, followed by retaliation if it obtains the approval and assent of Parliament. That is substantially the same as the statement made by the Prime Minister at Sheffield. It may have been a little more clearly put, but it was practically the official policy laid down at Sheffield, from which the Leader of the House has not departed in subsequent speeches. The President of the Board of Trade gave a very interesting psychological fact, which I think accounts a great deal for what has happened since. It appears that every member of the Government has got, like Faust, two souls, one is the official soul, which is retaliatory, and the other is a private, personal soul, which, in the case of most of the members of the Government is protectionist, though in one or two cases it is free-trade. This appears to account for all the vagaries which have taken place. It was the private and personal soul of the Prime Minister that prompted him to declare at Sheffield that he was in favour of reversing the fiscal policy of the last fifty years, a statement which drove the Duke of Devonshire out of the Cabinet. It was the same private and personal soul that prompted the President of the Board of Trade, on Tuesday last, to interrupt an hon. Member on this side of the House and tell the House that he wished it were possible to tax food.

THE PRESIDENT OF THE BOARD OF TRADE (Mr. GERALD BALFOUR,) Leeds (Central

was understood to deny this statement.

SIR JOHN GORST

It is quite clear that it was his protectionist soul that drove my right hon. friend the President of the Local Government Board to make speeches against those who were the supporters of the official policy of the Government. I gather from the speech of the President of the Local Government Board, which did not contradict the speech of the President of the Board of Trade, that this official policy will be maintained until after the division has taken place. The Secretary to the Board of Trade made a strong protectionist speech, but, with great ingenuity, it was not in favour of protection, but pointed out the most effective way of retaliating, and it was a good object lesson as to how a policy of retaliation may very quickly, under certain circumstances, develop itself into a policy of protection. Although this official policy of the Government is perfectly satisfactory, there is one singular circumstance about it, and it is that none of the members of the Government outside the House of Commons support the official policy at all. Some of us try to support the official policy of the Government by showing that colonial preference is undesirable, and by attacking the system of protection, but we meet with no encouragement of any kind from the Government, I want to ask a perfectly clear and definite question of the Government, which I think they might reply to on the spot, I want to know whether hereafter those who oppose the official policy of the Government, like the hon. Member who has just sat down, who go in for protection and colonial preference, will receive the official countenance and support of Cabinet Ministers in their candidature, to the exclusion of those who really and honestly support the official policy of the Government, [OPPOSITION cries of "Answer, answer."] That is a very simple question. I am a Tory of 1866, and during all my Parliamentary career I have served under the leaders who have been free-traders—the late Mr. Disraeli, Sir Stafford North cote, the late Marquess of Salisbury, and even the present Prime Minister, who has told us over and over again that he is a convinced free-trader. All the chiefs under whom I have served are staunch free-traders— Lord Cross, Lord Goschen, and the Duke of Devonshire, all of them still alive. To my noble friend I would counsel patience until this tyranny be past, and I hope he will live to be the head of the united Tory Party, with sound fiscal principles.

It would be almost indecent for me to sit down without saying a few words in support of that official policy which was announced from the Treasury Bench. I understand that the Government are officially opposed to colonial preference. I think in the interests of one of the greatest possessions of the British Empire, the Empire of India, they are wise. This has been overlooked in the agitation out-of-doors, although it was mentioned by the late Secretary of State for India, and it is one which deserves the attention of both sides of this House before the fiscal question is finally settled, because India contains 300,000,000 of inhabitants who are subjects of the British Empire. Consequently India, is next to Great Britain, the greatest free market in the world. Now, the Government of India have the advantage of having—I was going to say no Parliament, but that would be scarcely respectful to this Assembly. They have the advantage of having the complete command of the services of the very greatest experts and the most experienced commercial politicians which the Government of the great Indian Empire provides. They have been advised that these colonial preferences could do little good and might do great harm to the interests of the Indian Empire. The Indian Empire has not very much to offer in the way of preference to us, and it has hardly anything which it can gain from us in return. That is the advice of the experts, and it is adopted unanimously by the Government of India. I will not trouble the House with the details of the reasons, so admirably given in a despatch, for the Government of India coming to that conclusion. But there is one danger which that Government have to fear from the policy of the right hon. Gentleman the Member for West Birmingham to which I should like to be allowed to direct attention, because it is an admirable illustration of the extraordinary complexity of commercial relations, and I think it is a very good illustration of how people might do an immense amount of harm to commercial relations without ever dreaming that they were doing any mischief at all. It shows how an ignorant—I do not wish to use the word in a bad sense—it shows how an uninformed Government might put its hand into the delicate machine of commercial relations and do mischief they never thought of.

This is how the difficulty arises. India is a debtor country. It has to pay a sum of £16,000,000 per annum to Great Britain for services rendered—Army charges, stores, the diplomatic services in Persia and China, and so on; and there is the large sum that comes home as interest on the immense amount of British capital invested in India railways. They do not pay in direct exports to this country, because the trade of India is such that India takes from the United Kingdom £35,000,000 worth of our exports, which are chiefly manufactures, and we take only £21,000,000 worth of her exports, which are chiefly raw materials, articles of food and tea, so that you see, instead of there being any direct surplus of exports to Great Britain it is the other way, and the trade with Great Britain enhances the amount somehow or other she has to pay back to Great Britain. Well, how does she pay it back? She pays it through British possessions from which the imports into India are £5,000,000, while the exports are £11,000,000, and through foreign countries from which the imports into India are £12,500,000, and to which the exports from India amount to the enormous sum of £51,500,000. It is through these exports to foreign countries that India pays her £16,000,000 of debt, and the difference between imports and exports between her and Great Britain. Of course, the way in which this takes place is enormously complicated, as people may suppose, but I give the House two illustrations which will show the sort of way in which these payments take place. Of raw cotton—there is a good deal of cotton grown in India—£8,000,000 worth are exported from India. Hardly any of it comes direct to this country. Raw cotton imported by us from India only represents £370,000. We get nearly all our cotton from America. But there is a very large export of Indian cotton to Continental countries. Germany takes £1,250,000 worth, France £480,000, Italy £807,000, and Belgium £1,856,000. In fact most of the Indian cotton, except what goes to Japan, goes to the Continental countries of Europe. This cotton is worked up by the cotton mills of France, Germany, and Belgium, and finds its way into the English market as cotton manufactures, and these are amongst the articles which the supporters of the right hon. Gentleman the Member for West Birmingham denounce as imports that ought to be stopped by a large import duty. India is an enormous exporter of all kinds of seeds, and amongst others of linseed. She exports altogether as much as £3,500,000 worth of seeds. We take a very good proportion of them ourselves, but £593,000 worth go to France, and £809,000 worth go to Germany. In France and Germany tins linseed is made into linseed oil. There are great oil presses in Marseilles, Bremen, and Hamburg. Somehow or other the French and the Germans have superior processes of pressing, and can, therefore, supply our market with linseed oil which is cheaper and better than that we make at home. At any rate we do a large trade in linseed oil with the Continent. Partly, therefore, the sum which India must transmit to this country arrives in this way in the shape of cotton manufactures and linseed oil. I have no doubt the great Commission now sitting will severely tax these products if they can. That is a danger the Indian Government look forward to. Here they see that a small protective tariff might have a most pernicious effect on the trade of India without anybody intending it at all. I do not doubt that India would have of find some other mode of making the transmission, but this way in which it is done is the easiest way. If you disturb this, India will have to find some other way, and she cannot find so good and cheap a way. The disturbance of this particular form of trade will put an additional burden on the already overburdened people of India. It would be a distinct disadvantage to the trade and commerce of the Indian Empire.

While I am talking about India, may I revert to what I said a moment ago, that India is the greatest open market next to Great Britain in the world, and I say you could not possibly have any better test of the respective merits of protection and free trade for the protection and promotion of foreign trade, than the way in which the different nations of the world appear in the Indian market. In the despatch to which I have referred, there is an appendix which contains a short epitome of the Paper presented to Parliament on the trade of India, and I commend this little epitome to the most earnest attention of Members on both sides of the House, and especially to Members for Lancashire constituencies. I may mention that this appendix contains a statement of the amounts of the various articles imported into India from all the different countries in the world. I shall only trouble the House with one item, and that is cotton. In India they import altogether £1,658,000 worth of cotton yarn. How much of this is from spinners in Great Britain? Of that amount, £1,575,000 worth is from Great Britain, and from the whole of the Continent of Europe and the United States there only comes £73,000 worth. In the cotton manufactures exactly the same tale is told. Of cotton manufactures they import into India £18,323,000 worth, and of these there comes from the cotton manufacturers of Great Britain in competition with the whole world—because the whole world is in the Indian market—£17,525,000 worth. The whole of the Continent and the United States, and all our competitors put together, only supply £740,000 worth. These figures will not add up, but the difference is accounted for by the fact that I have left out a little margin which is imported from British possessions, such as Singapore and Hong-Kong. Who comes next to us? Why, Italy comes next with £143,000. The United States, the terrible competitors we are so much afraid of, import £81,000 of cotton manufactures and Ger I many £106,000. With figures like this before you, is it not true to say that the British manufacturer practically commands the entire market, and that no I other manufacturer is in it at all? And why do you command the market? You ask some of the Lancashire mill-owners. Let the hon. Member for Stalybridge ask some of his constituents why it is that they beat every nation in the world. It is because this is a free-trade country. The manufacturer can build his mill with untaxed materials, he can fill it with untaxed machinery, and he can get every one of those articles which are necessary for the manufacture of cotton in the cheapest market. He can buy his cotton in America, Egypt, and numerous other places, and every requisite for his manufacture in the cheapest market, and, therefore, he is able to undersell the American and German manufacturer whose Governments do not give him the privilege which the British manufacturer enjoys. It is said that we ought to rejoice in the prospect of lowering foreign tariffs. I wish that that prophecy might be fulfilled, but I do not think the cotton manufacturers of Lancashire would rejoice at that which would be no doubt beneficial to the world in general, for they would then lose the practical monopoly which I say they now enjoy of the Indian market, because Great Britain has been, and still is, a free-trade country. Let me recommend that argument to the consideration of the hon. Member for Stalybridge.

There is one other danger sketched out in the despatch of the Indian Government. What would happen if India itself were a protectionist country? Hitherto we have been able to maintain in India free trade, but the noble Lord the Member for Ealing said in his speech that representations were being continually made for protection in India. I know that such applications were frequently made when Lord Cross and I were at the India Office. How were these representations met? The noble Lord told us that he said— We have convinced ourselves that the policy of free trade is best for the inhabitants of this country, and we are giving to the population of India the same benefits that we ourselves enjoy. But supposing India became protectionist, what could you then say to the Indian manufacturers who want protection for their native goods? How could you refuse to them the protection you are giving to the manufacturers at home. You would not be able to maintain the present free-trade policy in India for a month. You would have a tax placed at once on your importations of cotton. Where then would your Lancashire trade be? Think of the enormous population in our Lancashire towns which is really manufacturing for the Indian market; and just think of the distress and confusion that would be entailed by a policy which deprives them of that market. I will not make a peroration, but I have thrown out some facts and arguments which the opponents of the Government ought to take into consideration before they press on the Government a change of their official policy. The silence of the President of the Board of Trade greatly alarms me. I do not know where I stand. I do not know whether the Government are really pleased at our support of their official commercial policy; but because I believe it is the best for the interests of the people of this country I shall continue to support it—even at the risk of displeasing His Majesty's Government. I promise to oppose in this House any attempt either to establish any colonial preference or to establish in this country a general protective system.

* MR. CHAPLIN (Lincolnshire, Sleaford)

My right hon. friend below me has dealt in some detail with some proposals for fiscal reform, so far as they are likely to affect the Government of India and that country. He is alarmed, he tells us, at the silence of the President of the Board of Trade on this subject. Not having had the advantage, like my right hon. friend, of having been in the India Office myself, I think it would be more respectful to him if I leave it to some member of the Government or one familiar with the affairs of India to deal with that branch of the subject. I propose to go to the Amendment which is immediately before the House. My right hon. friend the Member for Croydon told the House yesterday afternoon that there was nothing in that Amendment from which he was able to dissent, or of which he could not approve. I am sorry to say that, differing entirely from my right hon. friend in that respect, I think there is very little in that Amendment that I am able to support. I have taken great interest in the speech of the right hon. Gentleman who moved it; and I have followed with all the care and attention I have been able to give to them the various speeches which have succeeded, but I am bound to say—and I hope I say it without any offence—that I have been able to find very little in any of them either to support or establish the three main propositions which that Amendment contains. And, with the permission of the House, I desire for a few moments to examine them and to say a few words on each. What is the first proposition? It is as follows— That our effective deliberation on the financial service of the year is impaired by conflicting declarations from Your Majesty's Ministers. Conflicting declarations upon what? I presume upon the official or fiscal policies which are now before us. But the Government have expressly and repeatedly declared that there will be, and that there can be, no change in our fiscal policy during the present Parliament. And how conflicting declarations upon some future fiscal policy which may or may never come before the country [OPPOSITION laughter]—although I have very little doubt that it will, and with results which probably hon. Gentlemen opposite may not find altogether pleasant—how on earth conflicting declarations on a matter affecting another Parliament is to "impair our deliberations on the financial service of the present year," I confess I do not understand. It is not clear to me. I pass from that, which, after all, is a comparatively small matter, to the second proposition, and what is that?— 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. Now, I venture to think that in that statement the right hon. Gentleman goes somewhat too far. If he had been content to say that for many years after the adoption of free trade, perhaps for a quarter of a century, that policy had been followed by these results, then I do not know that I should have had anything to say in dispute of that proposition, because undoubtedly it is the case. I make the admission; I have never questioned for a moment that for many years after the adoption of free trade there was a very remarkable and unexampled development of prosperity in the country. Those who were its authors, or at least most of them, have always been in the habit of putting that down to the credit of free trade. With great respect, there again I think they go too far and that, to a certain extent, they are mistaken, because there were a vast number of causes at that time which contributed to that development of our industries, and that great prosperity. Although I admit that undoubtedly free trade played a part, and probably an important part, in that development, I doubt very much if other causes did not play an infinitely greater part. There were all the great inventions of that time: steam, the telegraph, and other scientific discoveries. Railroads everywhere were being created, steamboats were being built, and the means of transport were being increased every year. Then there were the immense discoveries of gold in California, and later in Australia—the most fertilising agency in the world as it has been described—causing a great expansion of the currency—a period of rising prices—giving the greatest stimulus to enterprise which the world has probably ever known. All these things, in my humble opinion, contributed to the great development and prosperity of those years in a greater degree than even free trade itself. At that time, it should also be remembered, in this country we had the start of all other nations. We had lived for many years at that time under a system of rigid protection. Our great manufactories had already been established and thoroughly equipped, which was not the case with others. I am speaking of facts which are known to everyone who has studied history. The consequence was that we were, at that time, in a position to take the fullest advantage of all those adventitious circumstances, which was not the case with other nations. We were called at that time, and rightly called, the workshop of the world. In those days we supplied foreign nations with almost everything they required: and in return we bought their food and supplies of provisions for ourselves. Cobden, no doubt, at that time thought his expectations had been realised in a greater degree than ever he had hoped for himself, and for aught I know he believed, and he had some reason for believing, that in all probability we should continue selling cotton and buying corn for an indefinite number of years to come.

But after a time there came a complete change in this respect, and it arose in this way. Foreign nations became tired of always depending on us for everything in the way of manufactured goods they required, and they determined to establish workshops of their own. How did they set about it? The first thing they did was to resort to our own discarded weapon of protection as the most potent instrument they could use for the purposes of the great object they had in view. Of course we are all familiar with the statements Cobden made at that time about foreign countries all being ready to follow our example. I desire to speak with the utmost respect in every way of Cobden. He was not only a great man, but I am sure he was a perfectly sincere man, and that all he prophesied again and again on this subject he most thoroughly and absolutely believed in himself. All we say against him is that he was mistaken on this point. No man in the world could have been more completely mistaken than he was. I will not repeat his prophecies, because every one knows them. He thought at first that the moment we adopted the principle of free trade all other countries in the world would hasten to follow our example; and, if Cobden had been right, we should have arrived undoubtedly and beyond all question at the ideal which, I suppose, each of us would set before himself—certainly I for one have never wavered in that opinion—namely free exchange. But, unfortunately, Cobden in all his predictions on this point turned out to be absolutely wrong. Exactly the opposite has happened. What we have seen, for many years, is this: foreign nations, one after the other, adopting a system of protection. As a matter of fact, I believe we are the only great country left in the world which still adheres to a system of free trade; but we have not got, and never have had free trade or anything whatever approaching it. That is why I have always been careful never to pronounce myself, as I have heard so many Gentlemen in all parts of the House pronounce themselves, "a convinced free-trader," and for this simple and sufficient reason: we have not got and we have never had free trade, and there is not a single man, in my generation at all events, who is able to speak from any practical knowledge or experience of the merits, or otherwise, of that system. On the contrary, not only have other countries one and all resorted to protection, but they have adopted that system with results which in recent years are most remarkable, and of which Cobden himself never dreamt for a single moment.

Some Gentlemen in this House profess to see no cause for alarm or anxiety or disquietude in connection with the present position of our trade. They think that the Board of Trade Returns and the Blue-book which has been published absolutely demolish the case which has been put forward for fiscal reform. So far as I understand him, the Leader of the Opposition is one of them. But there are other members of his Party who do not agree with him. Only on Monday, the right hon. Gentleman who moved the Amendment spoke of the conditions of our employment and of our trade as being such as to give cause for the gravest reflection. Another leading statesman belonging to the Party opposite made, some years ago, so striking and so remarkable a statement on this branch of the subject that I make no apology for quoting it to the House. In 1896 he told the country that year after year our Consuls and the Board of Trade warned us that we were no longer, as we once were the undisputed mistress of the world of commerce, but that we were threatened by one formidable rival at any rate. "I mean Germany," he said. Then he pointed out that our imports of manufactured goods from Germany rose from £16,000,000 in 1883 to £21,000,000 in 1893, or an increase of 30 per cent. in ten years, and that into a country which believed it had the monopoly of supplying the world with manufactured goods. Then he went on to say "In some of our Colonies, India and Egypt, German trade had gravely menaced British trade," and, finally, he added, "Surely an inquiry might be instituted, short, practical, and exhaustive into the cause of the decline of British trade and the alarming increase of our foreign rivals." "Germany," he concluded "is engaged in an industrial war with us, and in that, I think, unless we take precautions in time, she is not unlikely to succeed." Who was the statesman who made these observations? He is the statesman who, I understand, is the latest ally of the Leader of the Opposition. I mean Lord Rosebery. That was Lord Rosebery's case in 1896. That is my case, only more so now. The experience of the years that have elapsed since then have confirmed it, and with every word Lord Rosebery said at that time, I most entirely agree. Let me support Lord Rosebery's view by a single statement from the Blue-book. I could give many, but one is sufficient. It shows two things at all events; but I am bound to say that it seems to me that the students of the Blue-book book on the other side, as far as can be judged by their speeches, have been very careful to over look it. It shows firstly, that one of the cardinal doctrines of the Cobden Club that protection is necessarily fatal to successful competition in any industrial country, a statement endorsed by the right hon. Gentleman the Member for Croydon last night, is absolutely demolished by the test of actual experience. It shows, secondly, that whereas our commercial supremacy was originally achieved under what hon. and right hon. Gentlemen opposite call, and what the mover of the Amendment called, "the impoverishing system of protection," we are beginning to lose that commercial supremacy under a system of free trade.

I listened to the speech of the Parliamentary Secretary of the Board of Trade on Tuesday, and I desire to take this opportunity of expressing to him my most sincere congratulations on the very remarkable speech he delivered, by which he held a crowded House in rapt attention for over an hour. Like him, I desire to take, as an illustration to support my view, the Iron and Steel Trade. There is, and can be, nothing more important. Moreover, that trade is one in which, until a few years ago, we stood alone, in which we were unapproached and absolutely without a rival in the world. If hon. Gentlemen will try it by the test which is recommended in the Blue-book, what they will find is this. I take the year 1879 for this reason, because it was the year in which Bismarck abandoned free trade and resorted to protection. Hon. Gentlemen would find that the consumption of pig-iron, which is the best test of all, be- cause all iron and steel manufactures have to pass through that stage, in 1879 in Germany was 2,216,000 tons, and in England, 6,000,000 tons. But in 1902, whereas England had increased to 8.7 million tons, Germany had increased to 8,403,000 tons. In other words this country, with a start which was immense, increased only 2,000,000 tons, whereas Germany in the same period increased 6,000,000 tons. But that is nothing to America, which, during the same time, increased her production of pig-iron from 2,700,000 tons to 17,000,000 tons; i.e., an increase of 15,000,000 tons, while we had increased 2,000,000 only. I do not, however, rest my case upon America, because her natural resources are so great. Her area is so vast, and her coal and iron are often so much nearer the service than ours and so much easier to obtain. But I am not aware that Germany has any similar advantages over this country, and yet this is the result which we see under the system of protection, in the only country left that adheres to the system of free imports. We are caught and beaten by one of our protectionist rivals and outdistanced altogether by the other; and that in one of the chief and leading industries in the country. Where is this to stop? Is there no feeling of uncertainty and anxiety in this matter in the minds of hon. Members opposite. It is steel and iron to-day. It will be one of the other great industries to-morrow. I ask, with great earnestness, hon. Members of this House to consider is this a satisfactory condition of affairs?

I have only given one instance out of the many I could give because I did not wish to detain the House. Are we to sit still and do nothing, which I take to be the policy of the Opposition, in the face of these remarkable circumstances and facts which we see to-day, or are we to be moving? There is nothing in the world which surprises me so much, after giving credit to hon. Gentlemen opposite for having investigated and stated their case, as to see with what comparative in difference they regard it, and how little they seem to recognise the enormous change in the general position during the last twenty years, and the great necessity for doing something, at all events, to try and deal with the situation before it is too late. If it is to be met at all what is the remedy for it? Lord Rosebery, who does, or did appear to be alive to the gravity of the situation in 1896, thought he found both the cause and the remedy as well; though I think he was inaccurate, for in the course of the same speech he said— The cause is not far to seek, for the last sixty, seventy, or eighty years Germany has fitted herself by a most perfect system of technical education to be a great industrial nation. Nobody values the benefits of education more than I do, but when did this alarming increase begin? I beg hon. Members to consider this; curiously enough it was not until Prince Bismarck abandoned free trade and adopted the policy of protection and supplemented the advantages of education most effectually by securing for German manufacturers the undisturbed possession of their own markets. And if it was due to education alone, will any hon. or right hon. Gentleman explain to us how it is that this system of perfect education, having been in force for sixty, seventy, or eighty years, according to Lord Rosebery, did nothing to increase the prosperity of our rivals until they commenced to live under a system of protection. Let me say with regard to education, whatever may be its undoubted merits, that to suppose it is a remedy in itself is the greatest delusion in the world. Supposing it enabled you to produce your goods better and more cheaply than you ever did before; everyone knows perfectly well that the duties would be immediately raised, and your position would be worse than ever.

Now I pass from that to another branch of the subject. Others tell us, the Member for Fife, I believe, is one, that the fault lies with our manufacturers and workmen—want of enterprise in the one, of skill and industry in the other. I do not believe it, and until the contrary is proved I regard it as a libel upon both. No; there is another and a better reason for it. I have talked to men of business by the score and they all agree in this. That for succesful competition in trade, security for capital and the most effective means for cheap production are essential. Our rivals find security for capital in the possession of their home market, which is practically, to all intents and purposes, kept for them. And the secret of cheap production is large production. But for large production the first essential is that you shall have the largest possible market always open and assured to you. How do we stand in that respect as compared with our foreign rivals. They have always two markets open to them, their own, which is protected, and the market of this country, which is always open to the world, where they can compete with our own manufacturers and workmen to any extent they please. On the other hand, we have only what is left to us of our own markets by our rivals, the neutral markets of the world which are trifling, and the markets of the Colonies. It is in these industrial conditions, I am convinced, that the explanation will be found that while foreign countries under a system of protection have been increasing their production by leaps and bounds, we are caught and beaten in the race for trade, and unless some other steps are taken to avert it, we shall be beaten still worse in the future. What, then, is the remedy? There are three policies before us. One is the policy of the Opposition, which is to do nothing; the second is the policy of retaliation, which is the policy of the Government, and which, so far as it goes, is good, but it fails in two respects. It will not recover for you the markets you have lost, nor will it help you in others which are absolutely necessary to the workers of this country. Secondly, if it means anything, it means, according to the President of the Board of Trade, that in certain conditions duties will be imposed on manufactured goods. Now I remember perfectly well Mr. Gladstone's opinion on this point. He declared that nothing on earth would ever induce him to agree to protection upon manufacturers unless agriculture was included. Well, then! What remains. If these markets in place of those we have lost are vital to the interests of the workers of this country, who depend upon employment for their livelihood, where are we to look for them? Why, where should we look? Except to the Colonies, to the markets of our kith and kin beyond the seas? The right hon. Gentleman the Member for West Bristol, in whose speech the other night I thought I detected a note of indifference to the Colonies, said the trade of our Colonies can take care of itself, and we must dissociate ourselves from any idea of Colonial preference. I differ from the right hon. Gentleman in toto on this point. We often hear that no offer has been made to us by the Colonies, that there is no disposition on their part to meet us. No disposition to meet us? Why, already they voluntarily give us a preference, some of 33 per cent. others of 25 per cent. and so or, over foreign countries. And have we not had a note of warning of the very first importance upon this point? Let me read a passage from the "Summary of Proceedings" of the Conference between the Colonial Secretary and the Colonial Ministers in 1902— The Coloniall Ministers stated that if they could be assured that the Imperial Government…would grant to the food products of Canada in the United Kingdom exemption from duties now levied or hereafter imposed, they would be prepared to go further into the subject, and endeavour to give to the British manufacturer some increased advantage over his foreign competitors in the markets of Canada.…Meanwhile they determined to present to the Conference a Resolution affirming the principle of preferential trade and the desirability of its adoption by the Colonies, also expressing the opinion that the Government should reciprocate by granting preferential terms to the products of the Colonies in the markets of the mother country. Then they concluded with this very significant warning— If, after using every effort to bring about such a readjustment of the fiscal policy of the Empire, the Canadian Government should find that the principle of preferential trade is not acceptable to the mother country generally, or to the Colonies, then Canada should be free to take such action as might be deemed necessary in the presence of such conditions. Surely that statement should do something to dispel the illusions of the hon. Member for Bristol—and what is the only inference we can draw from it? Why, that we cannot stand still. We must go forward, or else we shall go back; and, if we are to go forward, where else have we to look to but to our Colonies? What is the objection to this proposal? Excepting that it may lead to difficulties with the Colonies instead of to increased advantages, I have not heard what seems to me to be a single reasonable objection urged against it. Let me say why I think the balance of argument is distinctly in favour of the proposal. There are Members present who have had some experience of the Colonies. I would ask them is there anyone who has had the same experience, or is so universally recognised as the best Colonial Secretary we have ever had, as the right hon. Gentleman the Member for West Birmingham? When my right hon. friend the Member for West Bristol, or the Leader of the Opposition, or any other distinguished Member opposite tells me that the Colonies will not do this, that, or the other; that you cannot successfully negotiate with them; that this policy, if tried, will end only in raising greater difficulties than exist at present—my answer to them one and all is that the man who is acknowledged to be the best Colonial Secretary we have ever had takes the opposite opinion, and if I have to choose between two conflicting opinions I prefer his opinion to theirs. One objection is that this policy cannot be carried out without some duties on food. Everybody knows how trifling the duties which have been proposed are.

* SIR CHARLES DILKE (Gloucestershire, Forest of Dean)

At present.

* MR. CHAPLIN

I do not know what reason the right hon. Baronet has for doubting the right hon. Gentleman for West Birmingham when he distinctly states that any duties he imposes will not be high duties—that they are to be low duties, not exceeding 2s. a quarter on corn.

* SIR CHARLES DILKE

Is it not a matter of certainty that they will have to be increased to carry out their object?

* MR. CHAPLIN

That is precisely one of those differences of opinion between the ex-Colonial Secretary and hon. Gentlemen opposite in which I prefer the opinion of my right hon. friend the Member for West Birmingham. It is often stated that the policy will raise the price of living. I deny it; and on the other hand, I affirm—and I am prepared to argue and demonstrate before any audience in the world—that if this proposal is adopted, it will result in actually reducing the cost of living, instead of increasing, to the poor. And who are the people who object to the proposal of a 2s. duty on corn? Some gentlemen, I regret to say, on my own side have even left the Government in consequence of it, and yet, one and all are men who, only two years ago not merely voted for, but most energetically supported and defended the imposition of a similar duty upon food, the only distinction being that in one case it would have increased the cost of the loaf by something less than half a farthing, while in this case it would increase the cost by something less than a whole farthing. Lord Goschen, one of the keenest opponents of this proposal, defended the imposition of the shilling duty, with consummate ability in the House of Lords, and, in the course of an admirable speech, he maintained at that time that— If the duty had been 2s. the bakers would have hesitated to raise the price of bread. It is upon this trifling charge, this imperceptible distinction, that some of my oldest and best friends, for whom I entertain the deepest regard, have thought it necessary to leave the Government of the Party with which they have been associated all their lives. And now, we know from experience that the duty imposed two years ago did not affect the price of bread in the slightest degree ["Oh!"]—Well, if you do not believe me, let me read on this point a statement made by a leader of the Labour Party who has been adopted as the Labour candidate for one of the divisions of Manchester. This statement was made on the morning before his adoption— He might say that when the duty of Is. was put on a few years ago the workers did not pay the 1s. It had been his duty to ascertain the price of bread, and he had visited shops in Hulme and Salford for that purpose on the 1st of the month, the results of which visit he sent to the Board of Trade. All the time the registration duty was on the price of bread, so far as Manchester was concerned, did not vary in the slightest degree. If, therefore, there is nothing in the objection on the score of food, what is there that remains? There is absolutely nothing so far as I know except some minor objections urged by the right hon. Gentleman the Member for Bristol, in which he puts to me some questions; one of them was— How will you be able to resist the demand for an increase in the duty however small they are at first? And he quoted other countries, like Germany and France, where they began with duties of 1s. and then 2s., which have now risen to 12s. But surely the answer is complete. It can never be raised except by the will of the voters themselves, and there is all the difference in the world between the conditions of the two countries, and of the voters in France and Germany and the conditions of our own country of the voters here. This argument has been raised over and over again in the country, and it has been used by men who ought to have known better. It is not conceivable that they are Dot aware of the reply to it. A vast number of voters in France are peasants owning little farms, they possess an enormous political influence, and it is because they wish it and desire it that those duties have been raised and are maintained as they are. But the position in those countries is exactly the opposite of what it is with us. Here the great majority of the people own no land at all. Their first requirement here is a cheap and abundant supply of food, and they have the power, which they use, and they always will be able to enforce it. The same thing holds good in Germany, though not precisely to the same extent; and in Germany there is another reason in addition—she has an enormous military frontier to defend. At any moment it is conceivable that Germany may be involved in war with some of her neighbours, and then instantly all the food which comes across her frontiers would be stopped; and therefore it is a matter of absolute military necessity that she should grow the main portion of her own food supply. But none of those conditions attach to us and it is the most futile argument to say that because duties in France and Germany began at 1s. and went up to 12s. that it is inevitable that the same thing would happen in this country. Then my right hon. friend says that I maintain that these duties will not raise the price of wheat, or the cost of living, and yet I tell the farmers they will be of help to them. The statement is not altogether accurate, for I never said they would not raise prices. What I did say was that the duties on corn would not raise the price of bread. The other duties might raise the price of food to a very trifling extent. Although they will not raise the price of bread, the duties upon corn will be, small though they are, I believe, some advantage and some help to the farmer.

The right hon. Gentleman asks me if colonial preference is to be limited to food or is it also to be extended to manufactures. The answer to that has been stated over and over again by the ex-Colonial Secretary, who says it is impossible to lay down the precise details of any arrangement for colonial preference with regard to manufactures until a mandate has been given by the country and until either he or others are in a position to begin the negotiations. My right hon. friend said— But if the duties will not raise prices, will the Member for Sleaford tell me why maize and bacon are excluded? As regards bacon, I have never said that the price of meat may not be to a trifling extent raised; and in reply to his question upon maize, I will answer it by asking him another. Why did the right hon. Gentleman himself draw a distinction between the 1s. duty on flour and maize? The duty on maize was made less than the duty on wheat by the right hon. Gentleman, when he imposed the 1s. duty in the first instance, and it is for the same reason, I believe, that maize is excluded now. But all these things are details and are lost in the great principle which is before us, and upon that my mind is absolutely made up. When my right hon. friend asks me and others, as he did the other night from that place, to abandon and give up the policy which we have been advocating in the country, little does he know the character of the man or those who support him if he thinks or believes we would ever entertain that notion for a moment. I oppose the Amendment for the reasons I have given already, and I support the Government because their policy, so far as it goes, is good. But above all I support the views which I advocate to-night because I believe them to be absolutely necessary in the future interests of the country, and above all in the interests of the workers who depend upon employment, and because I believe them to be right. I support them because I not only believe, but I know—I am not speaking now of the House of Commons—I know they represent the feeling of that great Party in the country with which for all my life I have been connected, and, sooner or later, I am absolutely persuaded and convinced that they will ultimately triumph and prevail.

MR. BRYCE (Aberdeen, S.)

I have listened with a great deal of interest to the very able speech of the right hon. Gentleman the Member for Sleaford, and I hope he will not think me disrespectful if I do not follow him through the arguments and figures which he has placed before the House. They are not new to us, for they have frequently been brought before the country during the autumn campaign and I think I may say they have been answered. [Cries of "No, No!"] I will confine myself to traversing one or two statements he made with regard to the growth of the German iron and steel industry as compared with our own. The right hon. Gentleman attributed the growth of Germany industrial prosperity to Bismarckian protectionism of 1879. Is he not aware that industrial prosperity advanced more rapidly under the lower duties of many years ago than during the time of Bismarck?

MR. CHAPLIN

My impression is that a great increase took place in later years.

MR. BRYCE

That increase occurred after the tariffs were lowered. Exports of iron and steel during the last three years have risen 20 per cent. in England, whereas the imports have been almost stationary, and the same argument applies to the woollen trade. There again there has been an increase in spite of the statements to the contrary which have so often been made. The right hon. Gentleman quoted the dictum of Mr. Gladstone to the effect that if protection is given to any manufacturing industries it must also be given to agriculture. I agree that you cannot protect the manufacturing industries without doing something for the oldest and still the greatest of all our industries. A 2s. duty on corn has been mentioned, but I have heard members of the protectionist party say that not less than 10s., 15s., or 20s., a quarter would be of any substantial use to the farmers of this country. Will the right hon. Gentleman promise that he will never ask us for more than a 2s. duty on corn? Is that the utmost limit of his desires? I believe that 2s. would only be the beginning and it would gradually mount higher and higher.

It is a very significant fact in this debate that nearly all the speeches in support of the Government have come from the protectionist Members of this House. The subject is very large and important, so large that if it were not for the exigencies of other public business we might go on discussing it—even if the discussion were confined to the other side of the House, where such difference of opinion exists—for another fortnight or three weeks. But I think there is another subject very interesting in the debate besides the great question of protection and free trade. It has been a debate largely devoted to a search for, and inquiry into, the policy of His Majesty's Government. That is what we are largely engaged in endeavouring to discover. It is not an easy question. Their policy is an evasive and elusive policy, and when it has been discovered, as some of us hope we have discovered it, it turns out to be a very small policy, infinitesimal in quantity. The policy represents a particle of radium almost invisibly small, but it does not resemble radium in this respect—it is by no means luminous. We have had three speeches from the Government. The first was that of my right hon. friend the President of the Board of Trade. There is no more clear thinker in the House than the President of the Board of Trade, and no one better able to express what his opinions are. I think I may venture to say that there is no one whose statements with regard to his own opinions we may except with more unqualified confidence. His speech was an encouragement to those of us who desire to see the Government come down on the free-trade side, but it was by no means a complete deliverance, because I noticed that he said he was him self not in favour of protection for Great Britain. He was careful to say that he was speaking only for himself and not for the Government, and he went so far as to say that, although he was not personally in favour of colonial preference, he hoped the time would arrive when the country would be in favour of colonial preference. That was an alarming deliverance to those who think a wish is very apt to find expression in means being taken to carry it out. When my right hon. friend calling himself a free-trader says that, I begin to fear that he and those who act with him will endeavour to accelerate the arrival of the period. The second speech was that of the Parliamentary Secretary to the Board of Trade. It was just such a speech as might be delivered to the Tariff Reform League. The third speech was that of the right hon. Gentleman the President of the Local Government Board. It was a very brilliant effort because the right hon. Gentleman, if he will allow me to say so, succeeded in attaining what is one of the rarest attitudes of an expert Parliamentarian. He made a speech and said nothing. We were really no wiser as to the policy and intentions of the Government after the right hon. Gentleman sat down. I can only suppose that he thought it the best way. For the hon. Gentleman said too much in Wiltshire and too little at West minster. If this is the attitude in which we are still left with regard to the intentions of the Government, we may properly look at what are the broad facts of the case.

Now, what is the attitude of the Prime Minister? The Prime Minister said at Sheffield that what we wanted was a fundamental reversal of the free-trade policy of this country. He has allowed his free-trade colleagues to go out of the Cabinet. Why did he allow them to go out? We know from their deliverances that it was not on the policy of retaliation they left the Government. Then we had a significant deliverance by the Prime Minister at Manchester. He put forward that his main duty in the present crisis was to keep his Party together. He seemed to forget for the moment that he was Prime Minister of this country and to remember only that he was leader of the Conservative Party. I think that is hardly a proper attitude for a Prime Minister. He ought to feel his duty to the nation as well as his Party. He conveyed the impression that he was thinking at this crisis not of what was best for the nation, not of the duty of the Government to lay their policy before the nation, but of his duty at all hazards to keep the Conservative Party together. What conclusion does one draw from such a deliverance? That he will take the course that seems best calculated to keep his Party together, that he will watch how the Party is going, and that he will endeavour to ride in the direction that the Party is going, so that the unity of the Party may be maintained. What was the attitude of the Conservative Party? When the right hon. Gentleman the Member for West Birmingham launched his scheme it contained four items—colonial preference, food tax, retaliation, and the 10 per cent. duty on manufactured goods—the last of which came a little after the others. What the country has seen in the discussion during the whole of last autumn was that the food tax is not wanted except by the land-owning interest; that colonial preference has been coldly received and would not succeed if it had not been mixed up with retaliation; retaliation had been better received than colonial preference, but standing by itself it would not excite any enthusiasm at all. That which has excited enthusiasm has been the proposal of protection for manufactured goods, only qualified by the wish and the hope that it was higher than the 10 per cent. now suggested. Now, the real issue before the country is not retaliation. It is whether we are to have retaliation as defined by the right hon. Gentleman the Member for West Birmingham or free trade. The real force behind the whole agitation is protection. That was said with perfect candour by the right hon. Gentleman the Member for Sleaford. We were told yesterday by a leading Member of the Conservative Party that in the country those who refused to follow in that direction were being ostracised and boycotted. The President of the Board of Trade said that the 10 per cent. was proposed because it would bring in revenue. Is it because it would bring in revenue that it is acclaimed by those manufacturers on the mock Royal Commission, and who are sitting now to say how it should be imposed? Surely we all know and feel that the real force and interest of the manufacturers who are supporting the movement is in order that they may make gain by this tariff. It may be proper gain, that I do not discuss. We cannot possibly ignore the motive behind the movement. What is perhaps still more conclusive proof of the phenomena is that nearly all the candidates standing in support of the Government are protectionist candidates, and that in the course of their candidature they narrow down the programme with which they begin.

What is the conclusion we may reasonably draw from the attitude of the Government and their Party? I venture to think that the Government are hardly dealt with by some of their own supporters on the other side of the House. The hon. Member for Oldham in the vivacious and interesting speech he gave us yesterday attributed to them deliberately dark designs. I think he could not overrate the craft of the Government, but he underrates its weakness. It does not seem to me to be out of deliberate purpose to beguile their supporters or the country, but out of mere hesitation, that they are adopting this doubtful attitude which baffles the desire to find out what they mean. They are playing a sort of seesaw between free trade and protection, but if we look at the attitude of the Government and if we see what is happening in their Party, we may feel certain that if the reins are held so loosely as this the horse will run away with the driver. I cannot doubt, when I see how strong the passion of protection is, that unless there is a fundamental reversal of the policy of facing both ways which has distinguished the Government during the last six months they will be swept, whether they will or not, into a purely protectionist Party. The President of the Board of Trade said the Government would fight for free trade. It is a very feeble kind of fighting that they have done so far, and I hope that at any rate when the Colonial Secretary speaks he will endeavour to clear up the darkness of the position. My right hon. friend the Member for Cambridge University asked some questions, but neither the Colonial Secretary, nor any Member on the Treasury Bench rose to answer. I hope he will answer them now. It is surely not necessary that we should wait for the return of the Prime Minister to have an answer. These are not matters of Parliamentary tactics, but questions on which the mind of the Government must have beer constantly fixed for the last six months, and on which we must presume that they have a policy which every one of them knows. May I repeat them to the Colonial Secretary, and perhaps he will permit me, the first time I have the pleasure of addressing him, to offer him the congratulations of many friends on this side of the House on the post he has attained in His Majesty's Government. May I venture to ask him—Will the Government not merely fight as the President of the Board of Trade says for free trade, but will they fight against protection? Will they fight against protection by repudiating protectionist candidates, where such candidates stand? Will they cease sending letters of encouragement to protectionist candidates? Will they cease to give aid and comfort to the protectionist Party? Will they declare themselves opposed in principle to colonial preference which necessarily involves the taxation of food? I will endeavour, if my right hon. friend doubts that, to show that colonial preference involves the taxation of food? These are points on which we are really entitled to have some answer from the Government, because without any answer we do not know in what direction to turn. Everyone of us on these Benches desires to support the Government against their opponents, followers of the right hon. Gentleman the Member for West Birmingham. The Government say that protection or preference will not be in view at the next election. But will the Government tell us what will be in view at a more distant period? What gain is it to us to know that when the Government go to the next election they will be against protection and preference and only in favour of retaliation, if we also know that the great bulk of their supporters are in favour of both. Surely the Government have had sufficient time to consider this question to tell us what they think of the protectionist policy, and what is to be for the good of the country in the future beyond the next general election?

Let me come for a few moments to the argument of the right hon. Gentleman the President of the Board of Trade on the subject of retaliation. Surely the argument for retaliation is the very thinnest that was ever presented to the nation. It is the very smallest and frailest barque which can carry the fortunes of a Government. What does it amount to? The idea is that we are to secure a fairer treatment for our exports by imposing, or threatening to impose, import duties on the goods of countries which have tariffs against ourselves. Of course, we can imagine a case in which retaliation might be profitable. I suppose the most orthodox economists have admitted that there might be a country to which protection might be profitable. So we can imagine a case in which retaliation might be a proper remedy. But does any case exist now? Will the Government give us a case, for it is only in that way that we can test whether retaliation can be imposed. There is a maxim that deceit lurks in generalities and I do think that there is a good deal that leads to confusion and difficulty in those general statements in which the Government deal. They never give us a concrete case. What is it that they have in their mind? We are told that if a case of outrageous unfairness arises it may properly be dealt with by retaliatory duties. But what is outrageous and unfair? We are apt to talk as if foreign tariffs are imposed for the express purpose of injuring British trade. Is that true? Foreign tariffs are imposed for the purpose of benefitting foreign manufactures. We are free-traders because we believe that that policy is for our own interest; and it is not to injure manufacturers abroad that the duties are put on in Germany and the United States. If you say that if a tariff is so drawn and framed that it hits British goods, that it is outrageous and unfair, and that that is the test. In that case what do you say to the Colonies? There are no tariffs which have been drawn more clearly in the view that the competition of the colonial manufacturers is a competition with the British manufactures. And yet we all know that they are not drawn in a spirit of unfriendliness to us. The Colonies draw their tariffs in order to benefit their own people. There must be a strong case in order to show that there is a desire on the part of foreign Governments to benefit foreign manufactures with an unfriendly and hostile feeling against us. The President of the Board of Trade says that the Government wants the power to impose retaliatory duties against foreign-countries who have high tariffs. But have they not got that already. There is nothing to prevent them coming down to the House and proposing duties which would induce foreign Governments to reduce their tariffs. I do not understand why this proposal requires a tremendous reversal of our existing policy. I believe that there is a statute that expressly provides for that, and there is nothing in our Constitutional usage to prevent it. It is quite true that Sir Robert Peel said that he had tried retaliation and gave it up. In that famous deliverance of his which marked the turning point in our commercial fiscal policy, he declared that it was only after repeated efforts to adopt the policy of retaliation that he had been obliged to give it up in despair. There is nothing to prevent the Government adopting a retaliatory policy, but they must give us a concrete case, showing the benefit that would follow. They cannot assume that they should be granted general powers, by which alone they could impose retaliatory tariffs. I say that no Government should come before Parliament and ask that they should be allowed, without approaching the House of Commons, to ask authority to impose retaliatory duties or to alter existing duties up or down. That would be to inflict an injury on private interests. Our manufacturers are entitled to submit to Parliament a case of injury done to them by foreign tariffs, and it is impossible that the Government should have the power to impose retaliatory duties on foreign goods without that information before them. The President of the Board of Trade was unfortunate in his statement of this part of the case of the Government. I cannot gather whether he contemplated that there was any case in which the Government desired to act without having first the authority of Parliament; and I wish he would clear that point up. It is a thing on which the Government must be informed before the general election, and I do not see why Parliament should not be informed of it now.

Let me take a concrete case, in order to show the difficulty of the position. There is no country whose import duties, whose high tariff, injures our trade so much as the United States. Of course, the Russian tariff is higher, but the United States is a much bigger market. It would be absurd to retaliate against any country if not against the United States. But on their own showing the Government could not retaliate against food from the United States; and they could not retaliate against raw material either. What remains? Only manufactured articles. But the manufactures we import from the United States are valued at £20,000,000, and more than one half of these are either practically raw materials or half-manufactured goods, so that there is only £8,000,000 or £10,000,000 worth of goods which it would be possible to attack. Do you suppose that retaliation on a trifle of that kind would injure the United States? The United States, with its great home market, would not care for almost any duty you would impose. She would rely on her home market, and her manufacturers, who are exceeding powerful, would not allow their protective system to be broken down by a petty thing of that sort. Therefore, you cannot hope to retaliate on their manufactures. And the case of the United States applies á fortiori to every other kind of retaliation. The practical objection to retaliation is that it must be either one of two things. It must be either a mere threat, not intended to be followed up by the imposition of duties. But if a mere threat, then it is a game of bluff, and the game of bluff is not creditable to a great country. We have had enough of bluff already, and it was not successful with a small country. But on the other hand, if intended to be carried out seriously, see what the cost of putting on the retaliatory duties would be. In the first place you would have a tariff war, and in that war the duties of the foreign country would be raised against you. Trade would suffer, and the diversion of trade from its accustomed channels would entail a very heavy loss. That was the experience of Germany and Russia, and the experience of the tariff war between France and Italy proved that there was not only a direct loss to trade, but that the trade did not come back to its old channels. In neither case can it be shown that trade was substantially benefited as the result of the tariff war. Then the second result of the imposition of retaliatory duties is that you accustom our own country to a policy of protection. It sees duties put on goods not for the purposes of revenue, and it familiarises the country to the idea of protection. Not only that, but you stimulate the desire of other trades, not so favoured, for protection. You put on a duty on a particular class of goods, let us say, iron or woollen goods, and you assume that that protection given to that particular industry alone. But other industries would ask why they should be left out in the cold, and you would have a particular and growing pressure from these other industries to have the same benefit given to them as had been given to the other industries. And then, lastly, if the policy of retaliation succeeds, and if you bring down the duties against your own country, the natural course would be to take off your own duties. But you cannot, for you would be met with the great difficulty that those who had bought land, purchased machinery, erected works, and made all preparations for carrying on their business on the basis of these duties, would turn round and complain that you had deprived them of the benefit of the duties. That is not theory, but the experience of every protectionist country in the world. It is easy to impose protective duties, but very difficult to take them off. The appetite grows with the eating. By the very process with which the Government declares they are fighting for free trade, this country would become protectionist itself.

I notice that the President of the Local Government Board argued that by putting a retaliatory duty on you would prevent dumping. I thought I noticed a little confusion in the mind of the right hon. Gentleman. Dumping is not done by foreign countries but by private persons, and retaliation will not prevent it unless the duty be high enough to keep the dumped goods out altogether. The only way in which you can prevent dumping is to dump yourselves, and that can only be done by making the home consumer pay more in order that you may be able to sell cheap abroad. Therefore, in order that you may have free trade in the rest of the world you will cease to have it yourselves. If you look abroad you will find that every country which practises retaliation is protectionist. I do not know of any free-trade country which has tried the policy of retaliation. There may be some countries that have tried it, I admit Holland is very nearly a free-trade country, and there are other countries which have such low tariffs that they are nearer free trade than protection. But it is only the countries which have high tariffs that practice retaliation. They do it with maximum and minimum tariffs, and to that we shall also be driven. It is only by having two tariff scales and shifting a country from one to the other that we can carry out a policy of retaliation. I do not deny that cases can be imagined in which a policy of retaliation may fairly be proposed; but I am sure the, House of Commons will not trust that power to a protectionist Government. If we had a Government in which the right hon. Gentleman the Member for West Bristol was Chancellor of the Exchequer and in which the President of the Board of Trade retained his present office, I can imagine that the House of Commons might perhaps allow retaliation, although even then it would be a very dangerous experiment. But I am perfectly certain that with a Government such as we have, which contains so many avowed protectionists, it would be perfectly impossible for this House to permit retaliation. We oppose retaliation not merely because no case has been shown for it, not merely because we believe that a policy of a tariff war is a ruinous policy, but also because we believe that it would lead us straight to protection.

So much has been said on the general aspect of the question that I will not ask the House to listen to any more figures on the subject or to any disquisitions as to the effect protection would have on any particular trade or industry. But there are one or two general aspects of the question which I should like to ask the House to consider. This country having had free imports for two generations there is scarcely a man amongst us who is able to remember the old system. We nowadays can hardly realise how fortunate we have been. You want to live in a protectionist country in order to know what are the fruits of a high tariff. In comparing this country with countries which have a high tariff, I was struck by the fact that the relation of the classes to each other in this country is more friendly and more wholesome than it is in protectionist countries. There is less jealousy, less suspicion, and less of the idea that one class is making profit at the expense of another in this country than there is in countries where manufacturers or agriculturists are allowed to enrich themselves at the expense of the consumer. I think we should be doing very little service to our politics and social order if we were to give occasion for the complaints and heartburnings which would necessarily and naturally arise between classes if one class thought its interests were being sacrificed for the benefit of another class. If the price of manufactured articles increased there would be at once a demand on the part of the workmen for higher wages. In some industries it is possible wages would be increased, but in other industries, less directly concerned with production, and above all in unskilled industry, wages would not increase but the cost of living would rise; and, therefore, you would put a greater pressure on the poorest classes of the community and there would be a reiterated demand for higher wages in order to enable the poor man to meet the increased cost of living. That is to say, you would probably inaugurate an era of strife and trade disputes by the very fact that the consumer would be paying more for the necessaries of life without having higher wages. It is possible that there might be a general rise of wages over the whole field of labour; but that would take a long time to come about. If, however, there was a rise of wages in the cotton industry it would mean the discontinuance of our cotton exports in some lines of business, because the cotton trade in some of its lines is conducted on such a narrow margin of profit that if the cost of production were enhanced it would be impossible to carry it on.

There is another advantage which any one who visits a protectionist country such as the United States will perceive that we possess under our system of free imports. Any one looking at the legislation of this country would be almost surprised to notice how small a part of our daily legislation affects the pecuniary interests of individuals. Very few of our Acts of Parliament have the effect of putting money into or taking money out of the pockets of any individual, or taking money or giving it to any class or trade. We stand almost alone in that respect. In a protectionist country a large part of the legislation is occupied in making changes in the tariff which operate to the pecuniary benefit of one class or another, and the greatest interest in legislation is excited by that part of the work of the Legislature. In fact it may be said that the Legislature in a protectionist country is chiefly occupied with tariff questions. It is only now and again that the tariff is wholly changed but the subject is never at rest. The manufacturers are an organised body and are constantly at work conveying their view to the members of the Legislature and to the executive Government and pressing for tariff changes which would benefit them. This causes constant uncertainty, and a business man never knows on what basis he may have to conduct his business, as he does not know whether the tariff is to go up or down. Large business organisations are formed whose sole business is to control the Legislature. The iron men, the soft goods men, and so on, form themselves into organisations whose object is to influence the Legislature. They subscribe large funds with which they create an agitation all over the country, and when an election comes they offer funds to the Party supposed to be most in their favour, and pledge that Party to their support. At present there are comparatively few questions in which we are concerned with the pecuniary interests of individuals or of constituences, but as soon as we have a protective tariff we shall have each constituency looking at the issues to be decided, not from the point of view of the general interests of the country, but from the point of view of what it may gain or lose. That is a necessary result of a fluctuating tariff. If we have avoided all these evils, need we suppose it is because of some peculiar quality inherent in our own nature. There was a time in the 18th century when the Parliament of England had not that purity which it now has; and if we have maintained an exceptionally high level of purity in public life and legislation, may it not be partly due to the fact that we have, to quite an exceptional degree, removed all temptation, and that we have given our legislators no opportunity of serving private pecuniary interests as is so often done in many other countries. When I think of the enormous benefit it has been to us to have our Legislature free from all these disturbing and malign influences which damage public life, I cannot but regard with the greatest alarm any proposal to follow the example of other countries in which changes of tariff are common, and in which it is possible for a Government to help a particular branch of industry.

We have heard a great deal about the predictions of Cobden. There is one prediction of his to which I wish to call attention. Some of his predictions have not been realised, but the fact that a prediction has not been realised is no reason for abandoning the policy behind it. Cobden predicted that with the growth of free government the world would be more at peace. We have had free government, but the world is not at peace; but we do not abandon on that account free government. The last fifty years has been the only period in English history when we have not been at war with a great Continental Power. May we not attribute that in some degree to the fact that all the great Continental countries, and the United States also, have good reason for keeping open trade with the country which gives them the best market. I know there have been moments when peace has been in danger, and when the fact that there was a strong interest in great manufacturing countries, such as France, Germany, or the United States, to keep open trade with England was a most powerful though silent influence in the direction of peace, and it would be a great misfortune for us to lose the security for peace which our great free market gives. There is, unhappily, enough of ill feeling between nations without losing such an advantage in the direction of preserving peace.

I want to know from the Colonial Secretary if he is in favour of colonial preference, whether he contemplates that any such preference is to extend to their manufactured goods. Would the 10 per cent. proposed by the right hon. Member for Birmingham on manufactured goods apply to the Colonies as well as foreign countries. Would colonial manufactures be admitted without a duty or would it be imposed upon them. If it were imposed upon them, what became of the union with the Colonies which we are told to expect? If it is not intended to be imposed upon them, and they are recognised as being entitled to have a preference on manufactured goods as well as foodstuffs, would not such preference be more or less of a bonus and stimulus for them to manufacture against us? Canada gave her steel manufacturers a bonus which actually doubled the amount of iron and steel we received from her. In that case dumping would go on, and the Colonies would obtain advantages which they were never intended to have. I am afraid that a system of commercial treaties within the Empire may really retard that federation which the right hon. Member for Birmingham desires. There is nothing the Colonies care more about than their own fiscal freedom, and every bargain made between the mother country and a colony will be the subject of discussion in the Colonial Legislature, the question being whether the bargain is not too good for us and too bad for them. I have talked with many protectionists in France and the United States, and I never met one of them yet who did not admit that, although he thinks protection good for his own country, he believes free trade is good for England. They all say that. I suppose hon. Gentlemen believe foreign protectionists believe it to be their interest to say so. I assure them that this statement has been made to me in moments of confidence. During the last seventy years we have built up a mighty fabric of commerce and trade unknown even relatively at any other stage of the world's history, and we have done that by trusting to the British race. We have built up our trade by the energies of our own people. While our competitors were relying on high tariffs and protected markets, we have followed the course that nature has marked out for us. The policy of free imports is the only true policy for an island nation such as we are, lying as we do between the old world and new; an island people unable to provide our own food, and a people eminently fitted to undertake maritime pursuits, with the result that we do two-thirds of the commerce of the whole world. We have set an example to the world in persevering with this free-trade policy for the last sixty or seventy years, and now, as the Government desires free trade, they will do it a very bad turn by making this country protectionist. If we persevere and set an example of self-reliance and conform to economic law, it will be to our lasting honour that we have given a very powerful help to those forces of reason and justice which are making for free trade in protectionist countries.

* THE SECRETARY OF STATE FOR THE COLONIES (Mr. LYTTELTON,) Warwick and Leamington

I will first thank the right hon. Gentleman for the courtesy and kindness of his personal reference to myself; but as far as I could follow his speech the first part of it was devoted to showing that retaliation was a very small thing, a trifle in itself, while the latter was devoted to showing that it was a very serious thing [Mr. BRYCE: In its consequences], and would lead to tariff wars. You cannot have it both ways. At any rate, it was serious enough to cause the resignation of my right hon. friend the Member for Croydon.

MR. RITCHIE (Croydon)

No. Really I should have thought that the explanation I gave of the reasons of my retirement would have shown my right hon. friend that retaliation was not the cause.

* MR. LYTTELTON

Yes, Sir, but my right hon. friend admitted himself, in writing, on 15th September, that— Any proposal for retaliatory duties would inevitably lead to protection, and produce far greater evils than they were destined to prevent.

MR. RITCHIE

If my right hon. friend is going to quote the letter he had better read it all.

* MR. LYTTELTON

I have read the point in the letter which I thought was relevant to the matter I had in hand.

MR. RITCHIE

If my right hon. friend will not read the whole letter I must read another paragraph of it— I am in entire sympathy with the desire to unite the mother country and the Colonies more closely together, but I know of no method by which preferential treatment can be accorded to the Colonies other than that which has been advocated by the Colonial Secretary—namely, the taxation of food, which involves, as a consequence, an increase of taxation. To this policy I am opposed.

* MR. LYTTELTON

I quoted the passage on which I relied, and, with great deference to my right hon. friend, the passage just read does not appear to require any modification of my original statement. Now I wish to say with perfect frankness at the outset that I do not intend, in a debate on the Address, to discuss a scheme for preferential duties which is not part of the scheme of the present Government, and into the details of which of course I cannot enter.

There were two questions asked by the right hon. Member for Cambridge University which I think were fair Questions One was. "Will the Government support those who honestly support the Government fiscal programme?" My answer is, "The Government will support those who honestly support, the Government programme." The second question was, "Will they oppose those candidates who go further than the fiscal programme of the Government in opinion, and who may be the advocates of colonial preference?" My answer is, "Yes; they will support those candidates who are in favour of the Government fiscal programme, even if their own opinions go farther than it." I hope that these two answers are at least plain. The noble Lord the Member for the Ealing Division of Middlesex appealed to those members of the Government who were going to speak after him not to go beyond the President of the Board of Trade in their utterances on this subject. I venture to think there ought to be reciprocity on the part of anyone who makes that demand. My noble friend the Member for Greenwich made a very able and eloquent speech. It would be unpardonable of me to demand relevance or materiality from most Members in a peroration, but from my noble friend I think I may do so, for he is lucid even when impassioned and he is clear though fervid. In his peroration he referred to a certain view of the Empire as a view of a gigantic profit-sharing business, and I suppose in doing that he endeavoured to cast some blame or reflection on the policy of the right hon. Member for West Birmingham. Since I have been at the Colonial Office I have been very much impressed by the business qualities of my distinguished predecessor. They are at once my envy and my despair. But I am even more impressed by the ideals and the traditions which he has left behind him. It would be a gross injustice to describe the policy of my right hon. friend as a policy which was in any sense dictated by mean and sordid ideas. I do not think my noble friend believed that that was the case; but I should like to bear testimony to the fact that there is no portion of the work of my right hon. friend the Member for West Birmingham at the Colonial Office which does not impress me with the great traditions and the great ideals of my predecessor with regard to the Colonies and colonial policy.

With regard to colonial preference, I appeal to my friends and to my opponents not to close the door upon it. They ask us not to support it. Let me beg of them, as one who has something to do with the Colonies, not to commit themselves against it. After all, what a man of genius and great historic imagination said fifty or sixty years ago on this subject is still true. Carlyle said— Our little isle is grown too narrow for us, but the world is wide enough yet. For another six thousand years England's sure markets will be among new Colonies of Englishmen in all quarters of the globe. The mother country can say, looking on her Colonies, Here are lands and seas, spice lands, corn lands, timber lands, overarched by zodiacs and stars, clasped by many sounding seas; wide spaces of the Maker's building fit for the cradle yet of mighty nations and their sciences and heroisms. The tendency is, if I may say so, on the part of some speakers, to shut the door on this splendid ideal. [Cries of "Oh, oh!"] I think that my noble friend the Member for Greenwich, when he spoke of profit-sharing and when he examined so minutely the balance-sheet as between the Colonies and ourselves, fell into the very error which the last speaker referred to—I mean the error of going too nicely into considerations of profit and loss and in not considering sufficiently the great ideal in question. I do not wish to argue the matter. I have said distinctly on several occasions before that I thought the future of colonial preference and its details required further discussion, cautious and deliberate discussion, before it is embarked upon, but it is no part at this time of the policy of the Government. Let me recall the actual history of the situation at the present time. Canada is ready to go even beyond the 33⅛ per cent. which she gives us. South Africa has carried out the Conference proposals made by the Customs Union. New Zealand has just passed a statute by which she gives a preference to this country sometimes double, sometimes 50 per cent., and sometimes 20 per cent. As regards the Commonwealth of Australia, according to my latest information, Mr. Deakin indicated in an interview that it was entirely erroneous for a London newspaper to say that the result of the elections was dead against Mr. Chamberlain's policy. That policy was supported by the whole of the Ministerial Party in Australia, by the majority of the Labour Party, and by an influential minority of the Opposition.

* SIR. CHARLES DILKE

Has he not since that interview pledged himself not to propose legislation in that direction?

* MR. LYTTELTON

My predecessor has endeavoured to knit closer the bonds between us and the Colonies; and since I have been in my present office I have done everything I possibly could to foster the sentiment referred to by the right hon. Gentleman the Member for South Aberdeen, and to obtain greater co-operation in Imperial defence, greater mutual knowledge, greater co-operation in Imperial counsel; and, inasmuch as we have got so much closer connection with the Colonies by these means, will you not regret it if you say that in the great sphere of commerce alone a closer link is to be wholly excluded? I trust that I make my position perfectly clear. Colonial preference is not a portion of the Government programme, but I do ask every hon. Member, and especially the Imperial Members of the Party opposite ["Oh, Oh!"] to pause a long time before they commit themselves to any view hostile to if. An attempt has been made, principally by the right hon. Member for the Montrose Burghs and my noble friend the Member for Greenwich, to put the issue before the country as if it was the issue between protection and free trade. The right hon. Gentleman, in a passage not characterised by his usual urbanity and logical sequence of thought, accused me and Mr. Charles Booth of being protectionists. The point was whether Mr. Charles Booth and I were protectionists because we were in favour of a 5 per cent. all-round uniform duty. Is that protection? [Cries of "Yes."] If that is a protectionist view, then the right hon. Gentleman and his colleagues in the late Government are surely protectionists, for they were responsible for the Government of India, and the Government of India fiscal system is a 5 per cent. all-round duty.

SIR HENRY FOWLER (Wolverhampton, E.)

The right hon. Gentleman is correct in saying that the Government at home sanctioned the imposition of a 5 per cent. duty in India, but they insisted on the imposition of a corresponding Excise duty.

* MR. LYTTELTON

I think that the Excise duty is only on one commodity—namely, cotton. Just see the looseness with which this term is used, and the absurdity of any Gentleman, however distinguished, attempting to rule out a policy by calling it what he thinks to be a bad name. If Mr. Charles Booth is a protectionist because he advocates a 5 per cent. all-round duty, then every Cabinet Minister of the last Liberal Administration is a protectionist, because they were responsible for the 5 per cent. duty in India. [Cries of "Oh!"] Right hon. Gentlemen opposite do not seem altogether satisfied with that line of reasoning. [OPPOSITION Cheers.] As they do not like a specific instance, may I give them authority in the matter? Will any right hon. Gentleman, however orthodox, refuse to accept Sir George Cornewall Lewis as an authority on fiscal matters? What did he say in 1857, when he was Chancellor of the Exchequer? He quoted the words of Arthur Young— If I were to define a good system of taxation, it would be that of bearing lightly on an infinite number of points and heavily on none. And he added— These opinions, though contrary to much that we hear at the present day, seem to me to be full of wisdom and to be a most practical guide in the arrangement of a system of taxation. I think I have disposed of the point [Cries of "Oh!"] as to whether the advocacy of such a duty as the 5 per cent. all-round duty in trade entitles any fair-minded man to call the advocate a protectionist. Suppose that, having such a duty on commodities, you used it, though imposed for revenue purposes, for the purpose say, of colonial preference, does that make it a protectionist duty? [Cries of "Yes" from the FREE TRADE UNIONISTS.] I observe that the Opposition is rather more cautious than the free-food Party. If a duty is imposed for the purposes of revenue, are you debarred from using it for other purposes? [Cries of "Yes."] If so, you must say that if a tax, put on for any purpose, incidentally benefits the home producer or our colonial kinsmen, it becomes protective. That seems to me to be pushing orthodoxy to the verge of fanaticism. If I put a duty on a commodity for revenue purposes, and if I am told that I cannot use that duty for the purposes of colonial preference or in order to benefit the home producer, I venture to say that any candid - minded man would say that this is not business but asceticism. It is not rational loyalty to a doctrine; but the superstitious worship of a dogma. [Cheers and cries of "Oh!"]

There is no man in the House from whom I would more cheerfully accept banter than the right hon. Member for Montrose. I did not expect him to have read any of my speeches at Leamington, but he put one of them in the forefront of his observations. I would make this very modest demand, however, that if he dignifies any utterance of mine in that way he will first read my speech and then quote it accurately. He asked me whether I was ignorant that Kingsley and Carlyle and Ruskin were opponents of the Corn Laws. Yes, Sir, I knew that when I was at Eton. I did not quote those distinguished men as advocates of the Corn Laws. They were opposed to them as I should have been. I quoted them as enemies and assailants of the old doctrine of laissez faire of the Ricardian economists. I do not think that anyone who has read any of those authors will attempt to deny that they were opponents of those doctrines. The right hon. Gentleman said that "the gloomy doctrinaires" would have made short work of me. That does not much concern me, because those doctrines are as dead as their authors. What is the general principles on which free-traders act? They were laid down long ago by Adam Smith. The first was, "Give me what I want and I will give you what you want." The next is, "The merchant is not a citizen of any particular country;" and the third is that the individual, by following his own advantage, is necessarily led to benefit society. Those are the fundamental doctrines of Adam Smith, and I think I fairly represent them, and they are really the basis of the doctrine of free trade. In trade there are no obligations of patriotism, said the free-traders. From the dealings of trade must be eliminated the prejudice of country. The great wheel of commerce must revolve monotonously, no matter whom it crushes in its orbit. It is weakness and sentimentality, they think, to attempt to check the friction and loss and suffering which might result from the remorseless progress of commerce entirely uninterfered with by law. In my speech at Leamington I pointed out that that was the doctrine against which men strove for a long time, and that the various Factory Acts, which were designed to save and support the worker, were expressions of a revolt against this doctrine. The deduction to be drawn from these Acts was, I said, that you cannot abandon human beings to blind forces, and that you must keep a controlling hand upon the conditions of industry and have a regard to the physical well-being of those who are engaged in an industrial system. The under- lying lesson to be learnt from this conflict of the last fifty years is expressed in that legislation—of which it will not be denied the Conservative Party were the pioneers, though the Liberal Party have fully supported and adopted the principles—which is a negation of the fundamental doctrines of Adam Smith and an affirmation of the principle that individuals cannot be left to pursue their own advantage uncontrolled by any other consideration. In other words, you must not consider merely the aggregation of wealth. You must also consider the ultimate effects upon society. What I venture to think is the corollary from those premises which I have just laid before the House is that the lesson has been thoroughly learnt in internal trade, but it is not—and this appears to me to be so astonishing—so clearly perceived in international trade. While the Legislature of this country says, on the one side, "We cannot disregard the conditions of industry, and we will not allow wealth to be produced without consideration of them," you cannot have the Legislature saying on the other side, "We will open every port at every time to all goods produced under all conditions," and so proclaim at the same time to all the world that we have not one single weapon with which to defend the fabric that we have raised. How is it possible that those two systems can have any congruity? How is it possible that they can stand for any length of time side by side? The right hon. Member for the Forest of Dean gave out of his repository of facts a list of a number of laws in foreign countries which he said were as good laws as ours.

* SIR CHARLES DILKE

Yes, and some much in advance.

* MR. LYTTELTON

Yes. My point was that the conditions of industry under which commodities were produced in England were greatly superior to those of the great protective countries abroad. I have not the slightest doubt that the conditions of industry here are much better, but I do not ask him to accept my authority; I will give him the authority of the right hon. Member for East Fife. He said— Talk about Germany and the wages of a protectionist country! I hope you will compare from the materials the Blue-book has placed at your disposal, the wages the standard of living, and the hours of labour of the German workmen to your own.

* SIR CHARLES DILKE

The right hon. Gentleman is perpetually quoting me as if I agreed in the doctrine he is laying down. I quoted his speech on the specific point that he alleged that protective duties must be put on to compensate us for our heavy charges on manufacturers in respect of certain specific Acts, which I say are met by Acts which put heavier charges on the manufacturers abroad.

* MR. LYTTELTON

I never said a word about protective duties at all. What I pointed out was that the conditions of industry in England which had been prescribed by the Legislature caused the output of commodities here to be dearer generally than the output of commodities a broad. I said that among other features which were noticeable was the fact that conditions of labour were very much worse abroad. I will quote another authority—the right hon. Member for Montrose. He said— Next, in regard to Germany, it was a fact that some 4,000,000 of workers there, or two-thirds of the whole, were returned as earning less than 15s. a week. Sixty-five per cent. of the total were earning less than £10 per annum, and 85 per cent. less than £1 a week. Did these facts show Germany to be a paradise? So far from being a paradise it was not even purgatory, but a lower state still. That is a country which the right hon. Gentleman the Member for Forest of Dean says, so far as I can understand him, is producing commodities under the same conditions as we produce them ourselves.

We have had in the course of this debate very frequent references again, as to what I may call almost the elementary particulars of this subject. We have had trotted out again the old idea that you can look upon the consumer as one person, and the producer as another. It cannot be too often said that in 99 per cent. of cases the producer and the consumer are the same individual. Suppose that I were a workman earning £100 a year—suppose that I were a glass-worker, and that by the advantage of buying cheap commodities my income were £20 a year better than it would be if I had to buy at a dearer price. Suppose that by the process of dumping, or any process of unfair competition, my employer's business were annihilated; no doubt it would be very convenient that I should buy my commodities at £20 a year cheaper than I could under a different system, but suppose that my inherited skill in the work I had practised were lost, and that I was unable to find employment again for a year or two, and then at an employment and under conditions in which my training would be wholly useless, is it not obvious that the money which I save from buying cheaper commodities might be too dearly gained, and that the friction and loss and suffering which was occasioned by the sweeping away of the industry might be much heavier than the gain which I have made by being a purchaser of the cheaper commodities? I see that hon. Members smile at that as if the doctrine were something new. I do not profess for a moment that it is. [Cries of "No."] I am sure that my right hon. friend the Member for Aberdeen will at any rate admit the honoured name of Professor Henry Sidgwick as a great authority on economic matters, and I think I could show him a passage which is the foundation of what I have endeavoured to lay before the House.

The right hon. Member reminds me of his question about colonial preference, but I thought that I had answered that at the beginning of my speech. I said that in a debate on the Address I would not enter into the question of what the details of colonial preference would be, colonial preference not being part of the Government programme, but being in the future only.

There is one general observation I should like to make in conclusion. I have tried to show that the sense of the community has revolted, at any rate in internal commerce, from the extreme doctrines of individualism, but yet that a large party maintain that they should still endure in international relations. I venture to think that the obstacle to our getting free from those doctrines is the strong sense—in many ways a very good thing—of individualism which exists in this country. A French writer has said, "Men fall often by the same qualities by which they rise." In one period individual energy may be justified, but in a world of organised and be-tariffed communities, individual energy may fail in commerce as the undisciplined valour of the Gaul failed against the legions of Caesar. It is a rule and practice in this House that when a proposal is brought forward by which individual enterprise, authorised by Parliament, is threatened by State or rate-aided competition very special circumstances must be adduced before any such competition is permitted. That recognises to some extent the powerlessness of individual enterprise when it matches itself with State or rate-aided enterprise. At the same time we do not recognise that in international trade relations at all. When I was a member of the Royal Commission upon the Port of London we had in evidence most interesting and elaborate statements with regard to the progress made by Germany and France in their dock enterprise, and we heard how docks in those countries, elaborately equipped and aided by the municipality and the State, were by an equally elaborate system supported by State railways. This great organisation of foreign trade, which must, I think, be regarded with alarm by those who think carefully upon it, is pitted against our individual enterprise. Hon. Members well know how fine an enterprise the London dock companies were at the beginning of last century. Now they are practically unable to raise a single shilling. They have been exhausted, almost financially annihilated, among other things, by the competition of these very great State and rate-aided institutions. If foreign companies have by means of this enterprise power to strike, they have also taken upon themselves the power to defend themselves by high tariffs. It is against such a system as that hon. Members opposite say that nothing can be done—that nothing effective can be done either by retaliation or otherwise. I rejoice to be a member of the Unionist Party, which at any rate is awake to the state of affairs which prevails at the present time, and which is ready and anxious to do its best to apply a remedy.

* MR. LOUGH (Islington, W.)

said that the position in which the House had been placed by the speech of the right hon. Gentleman the Colonial Secretary was curious. Throughout the debate they had been trying to obtain from the Government a clear statement of their policy. On Monday the President of the Board of Trade said that that policy was unhesitatingly against protection, and that even after the next general election, the Government would not take up colonial preference, or carry out the policy of retaliation, except by bringing each particular case before Parliament. But the speech of the Colonial Secretary to which they had just listened was steeped from beginning to end in preference and protection. The hon. Member for Cambridge University, speaking in the name of many on his own side of the House, asked if the Government would support candidates at the next General Election whose support of the Government was limited to the policy of retaliation. The Colonial Secretary, in reply, said that the Government would do so if these candidates were supporting the Government "honestly." The right hon. Gentleman laid emphasis on the word "honestly." and that practically amounted to a charge of dishonesty against hon. Gentlemen in this House whose conduct during the past few months had been a credit to themselves and to Parliament.

* MR. LYTTELTON

said that the hon. Member must not say that. He made no charge of dishonesty against any hon. Gentleman in the House.

* MR. LOUGH

said that the right hon. Gentleman took no exception when he mentioned that emphasis had been laid by him on the word "honestly," but only when he put a comment upon it. A second question had been asked by the hon. Member for Cambridge University—viz., would the Government lend their support to candidates and organisations which went further and advocated a policy of preference? That was a most momentous question, and the Colonial Secretary said that the Government would give their I support to candidates who advocated colonial preference. How could the President of the Board of Trade reconcile that answer with what he had said a few days ago? It was scarcely honest for the Government not to be more candid to the House and the country in giving their real opinion on this matter. The Colonial Secretary had quoted a very noble passage from Carlyle. It was a pity to bring the splendid observations of that eminent literary man into the narrow sphere of political controversy in this House. They all agreed with Carlyle that our little Isle was grown too narrow for us, but. he maintained that the defence of free trade by the Liberal Party was a powerful instrument in the hands of Providence to build up that great colonial Empire which was being placed in danger by the action of the Government. The right hon. Gentleman talked as if the country had no experience of colonial preference. Did not the right hon. Gentleman know that we had had two centuries' experience of that policy? There was not a suggestion in the speeches of the Member for West Birmingham which had not been made over and over again years before the right hon. Gentleman was born. We had had preferences on sugar and timber and all the produce of the Colonies, and these had nearly brought about the disruption of the Empire. Gradually the principles of free trade had been substituted for that policy, and the effect on the Colonies had been to unite them with the mother country in stronger bonds than any merely selfish tie. The Colonial Secretary was not well advised in trying to make Party capital out of the confidence, love, and respect which they all entertained for the Colonies. The question was whether the good feeling which now existed would not be endangered by the policy of colonial preferences. It was admitted by the Member for West Birmingham that our trade with the Colonies was growing every year. Fifty years ago our whole export trade to the Colonies was less than £20,000,000, while last year it was £110,000,000, or five times as great, and this great expanse had taken place under free trade.

AN HON. MEMBER

asked whether it did not occur to the hon. Gentleman that if we refused the offer of the Colonies they would enter into an alliance with other nations.

* MR. LOUGH

said he denied that there was any offer from the Colonies. Such a thing as an offer ought to be made in a distinct and formal manner, and there was none such. The proposals of the Government had, in fact, plunged the Colonies into as great a turmoil as this country. The Colonial Secretary had produced some of the most commonplace arguments in support of protection. He suggested that workmen's trade unions were an infringement of free trade; he might just as well have said that a trade union among barristers interfered with the operations of free trade. The definition offer trade for the purposes of the controversy was perfectly simple; it was that the Government should not interfere with the trade relations between this and other countries. He had never heard a more preposterous statement than that made by the Colonial Secretary that we had not a weapon left in our hands to defend our trade interests against attacks from foreign countries. Our commerce was greater than that of any other nation in the world, both per head of the population and in total volume. How was it that so serious a crisis had arisen so suddenly, and why should it have been sprung upon the country? The best summary of the case had been given by the Under-Secretary of the Board of Trade, who stated that the whole agitation rested on the one point that the exports of this country were small and unsatisfactory compared with the imports. His case rested on three statements. First, that the exports were not of sufficient quantity, second, that they were not of the right quality, and third, that they did not go to the right destination. The problem was not properly answered by dealing with special trades. No doubt it was easy to select a particular trade and prove that it had failed. Trades constantly failed and free-traders never undertook to make all trades successful. Nor when we prove that a given trade is very successful do we meet the difficulty. Neither is it necessary to quarrel with Gentlemen opposite who select some particular year for their calculations. The right answer to the argument avoids all such side issues. What, then, is the proper answer to what may be called the Birmingham policy? If he might say so very respectfully the proper answer was that there was not a word of truth in the statements which had been made. Exports were not and could not be less than imports. Perhaps the matter can be more simply explained if I trace for a moment the origin of this fallacy. The idea that exports were smaller than imports perhaps arose in the Statistical Society where a paper was once read by a distinguished man on what he called "The Excess of Imports." There could be no excess of imports. Imports were like income or wealth; there could not be too much of them, and they were all advantageous if properly used. Then the matter was carried to its second stage by a distinguished statesman who arrived in this country from the Colonies. He heard the story that the imports of the country were excessive and he crystalised the situation as follows— Yes, and we pay a hundred and sixty million sovereigns every year for this excess. That remark excited ridicule throughout the country because we had not got a hundred and sixty million sovereigns to pay and even if it had it would not have met the difficulty because they were supposed to have been paying them annually for twenty years. Therefore, according to Mr. Seddon the country would require not a hundred and sixty million sovereigns but 3,000 million sovereigns. That was all nonsense. No sovereigns went out. Our money would not be accepted by the countries which sent the imports. The third and final stage of the fallacy was reached in one of the speeches of the Member for West Birmingham, who said— Suppose all industrial enterprise in this country died out, that mills were stopped, that there was no work, so that the all people were idle, and that the country's ships went to the bottom of the sea, what would happen then? He said— Then our imports would treble and the country would have to import to the value of £1,500,000,000! What a statement to make! Probably no greater example of absurdity had ever been reached in the domain of human error. If our exports fell away to nothing then our imports would also disappear. My argument will be assisted if I give a simple definition of what exports are. Exports consist of material and services. That definition covered every form of export. But I will be asked if the matter is so simple as this, how is it so many people should have fallen into error? The answer is because they had made an improper use of the Government Blue-book, the Statistics, Abstract, and other publications of the Board of Trade. They assumed that complete information was furnished, but the story could not be found in any such documents, nor could a Government Department have prepared it. He was not attacking the Department when he called attention to the necessary limitations of their publications. If anyone would look up the story the Department gave of trade, he would find that the destination of exports and imports was not properly set out, the ports to and from which they were shipped only were given. Thus it appeared that Holland and Belgium sent this country a great deal more produce than they actually did. The Board of Trade specially warned readers as to this inaccuracy. But the great defect was that the Blue-book gave no account of services. The right hon. Gentleman the Member for West Birmingham said the best export was that which contained the least material and the most services. He would therefore, no doubt, be prepared to admit that the best export of all was that which contained no material and all services. What were those services? The first and greatest was the service of the country's shipping and that was entirely omitted from the Blue-book. There was the further service of building the ships which carried the nation's commerce to every part of the world, and that too ought to be regarded as part of the country's export. If such services were included they would not have these ridiculous statistics thrown at them. The late Colonial Secretary at Liverpool, looking at the fifty-five miles of quays in that most wonderful seaport, said— I am accused of leaving out ships but I do not intend to leave them out. Our shipping is worth £90,000,000 sterling. But he did not proceed to correct his fallacious statistics and include ships as part of the country's export. It was said during the debate that a large quantity of produce come from America and Russia and that this country sent nothing in return. This country, however, did 60 per cent. of the ocean carrying trade of America and 55 per cent. of the ocean carrying trade of Russia, and all the produce from those countries was paid for by the services which this country in that way rendered to them. Other services were enterprises carried on abroad. Those were export as much as anything else. An attempt was made to confuse the capital with the profits of such enterprises. That was not necessary. If he invested £1,000 in a Brazilian railway it might pay nothing, in which case it would not be an export; but if it paid £60 a year and if he brought that £60 back to this country in the form of coffee or wheat or other imports, then certainly it would be an export. Taking the definition of exports as given by the Member for West Birmingham, it would be found that the exports were equal to the imports and that this country sent out no money whatever. Exports might exceed imports, but it was impossible that the imports could exceed exports any more than water should ascend beyond its own level.

The second objection was that the exports were not of the right character, that there was not enough of manufacture in them. But it would be exceedingly difficult to maintain this position. What did hon. Gentlemen wish to send out? Was it more iron? or silk? or woollens? The commerce of this country had grown without any interference from the Government; the nation was exceedingly prosperous; and if exports in any given direction were increased without also increasing imports, the effect would be to displace something else. Did hon. Gentlemen opposite want to destroy the maritime supremacy of the country, or to displace British enterprises abroad? If they did they would meet with the greatest resistance. He did not believe that the House would interfere with the commercial liberty which the country had enjoyed so long. He believed the third objection was that we had too much commerce with foreign nations and not enough with the Colonies, but he had already dealt with this point and shown that cur exports to the Colonies were steadily increasing, and any artificial interference with the progress of this business would tend to break up the colonial Empire altogether and endanger the colonial trade which was now in existence.

He turned for a moment to the argument of the Parliamentary Secretary to the Board of Trade with reference to dumping. He did not think that this question had been fairly examined. The Member for West Birmingham had defined dumping and said that it took place when a country produced more of any commodity than it was able to consume that then it could only get rid of the surplus by dumping it. and that Great Britain was the only country in which this dumping could take place. He had already spoken of one monstrous mistake the right hon. Gentleman had made, and he would only say now that if there could be a greater it would be the right hon. Gentleman's definition of dumping. Let the House consider it for a moment from the standpoint of a business with which he was familiar—the tea trade. Forty years ago no tea was produced within the Empire. It was all imported from foreign countries. Last year 325,000,000 lbs. of tea were grown in India and Ceylon, but the United Kingdom only consumed 250,000,000 lbs. What was done with the 75,000,000 lbs. that remained over? Why it was dumped. He had never heard anything so thoughtless as the statements with reference to this great branch of business. If dumping were a crime there was no nation in the world that committed it for such a long period as the British nation. It would be impossible to adopt any new principle with regard to dumping in a. one-sided manner. If dumping were bad then this country's dumping abroad should be stopped; but if it were interfered with the country would get into difficulties of which hon. Gentlemen had no conception. We dumped 20,000,000 tons of coal abroad every year. We dumped our cottons, our woollens, our iron. We had done it for generations. According to the ex-Colonial Secretary dumping occurred when the country produced more than it could consume. Was the production, then, of every nation to cease when her own wants were supplied? Would France have to consume all the wines she produced? Were the fruit and spices of the East all to be consumed in the countries which produced them? Were the carpets of Persia all to be used in that country? All such suggestions were the foolish utterances of men totally unacquainted with trade. It was hardly an exaggeration to say that dumping was the foundation of English commerce, the palladium of our business freedom, and the man who interfered with it would be an enemy to his country.

He would now turn to the policy of retaliation which the Prime Minister had adopted. It had been stated that foreign nations had treated us with outrageous unfairness in raising up a wall of hostile tariffs against us, from which great injury had fallen on our commerce, but he would observe that there were two distinct features in the commercial ideas of foreign countries. In the first place the country which shut out our goods by tariff still wanted to trade with us, but they put on a high tariff to exclude some particular goods of ours. In the second place they only treated us in the same way that they treated every other country. And why should they not do that? If a country had the power why should it not shut out whatever goods it pleased? What was the effect of a high wall of tariff? The effect was that it oppressed their own people, and did not do us any harm, because whatever goods the foreign country sent over here they must accept payment for them in some other kind of goods from us. Their walls of tariff, then, only limited the power of selection on the part of their own people, and compelled them to take payment from us through some of the narrow channels which their governments still left open, which were more profitable to us than what they would select if the wider field had not been closed. The merchants of this country were not such fools as the Government supposed, they were able to protect their own interests and to secure that whatever the limitations protective systems might impose, profitable bargains were always made with the foreigner. Free trade was the best weapon to fight hostile tariffs. This weapon had served them well in the past, and if they stuck to it now it would serve them well in the future. Retaliation was the thin end of the wedge, and its adoption would inevitably lead to the broad system of protection. Let us examine the single experiment in retaliation which the Government have made. Nearly every Member of the Government who had spoken had mentioned the Sugar Convention as a good illustration of their successful interference with "dumping," and as an example of retaliation. The Sugar Convention Bill was an Act shaped on the ideas of the late Colonial Secretary. It had only been in operation some five months, and how had it effected already the consumption of sugar? Between 1902 and 1903 the consumption of sugar had fallen by 10 per cent. Sugar was the raw material of a good many commercial enterprises, and the fact that one-tenth of that trade had been destroyed by the action of the Government was an example of the folly into which the House had wandered. The Sugar Convention Bill was passed for the sake of the Colonies, and they were told that the effect of the measure would be that the export of sugar from the West Indies would be doubled and the decline of the industries of those islands would be arrested. As a matter of fact, in the year in which the Act had been carried into law the export of sugar from the West Indies was less than the previous year, for in 1902 the total was 1,200,000"cwts., whilst in 1903 the total was 700,000 cwts. Therefore they had not secured the end which they had been striving to obtain. They voted £250,000 as a free gift to the sugar industry, to keep it going until the Convention came into operation. What ought they to pay now when the Act had come into operation, and when they had given, what might prove, a final blow to the sugar industry of the West Indies? The great triumph of the Convention was to be the abolition of those noxious bounties which had depreciated the price of sugar below the cost of production. The moment the bounties ceased sugar was to advance 5s. per cwt., and the Government had adopted this policy regardless of the blow it would have given to British trade if their calculations had been correct. But what happened? The price of sugar had not advanced when the bounties were abolished, thus proving that their nature and effect had been entirely misconceived, and the whole enterprise, which culminated in the Sugar Convention Act, was a huge fatality. In the debate last year on this question the President of the Board of Trade said that if they gave protection to raw and refined sugar they would secure protection for sugared goods, and he said that if the Commission declared that sugared goods were not to be protected in the same way the Government would take immediate action when Parliament met. When the Commission met they stated that sugared goods were not in the same position, and refused the confectioners any protection, and this had struck a very severe blow at the confectionery industries of this country. This simple illustration was a proof that this House ought to hesitate before making any further experiment in the same direction.

There was one other aspect of this question of protection and free trade. They were too adopt to forget what an important country Ireland was, and how deeply she Was interested in those great experiments. The people of Ireland were suffering from the high price of sugar, and they were paying between £400,000 and £500,000 a year in extra taxation owing to the imposition of the sugar tax some two or three years since. Whatever they did in regard to these matters in this country Ireland had to bear her share of any loss or any mistakes they made. Looking back on the last century they could see the effect of both the policies on that unhappy country. Under fifty years of protection Ireland endured the greatest famine in her history. Then followed fifty years of free trade, during which her industries had been ruined and her population reduced to half, and now there was the keenest political discontent throughout the country. The fact was that whatever this Parliament did it could do no good to Ireland. Still, there was a standpoint from which hon. Members from Ireland c add regard this question. Free trade meant fiscal freedom, but the idea of Colonial preference or any Imperial zollverein would lead us in an opposite direction. It was quite in accordance with the principles of free trade that Ireland should have the right to put on her own taxes, as the Channel Islands did. Ireland suffered very much under the 1s. corn duty, and, without saying that Ireland was very deeply interested in the fiscal question, he ventured to say that British protection offered no more advan- tages to Ireland than British free trade. On the contrary, the principles of free trade were more likely to be advantageous to Ireland than protection.

The concluding paragraph of this Amendment referred to the blessings of free trade. They were divided into three parts, which had been laid down by all the great apostles of free trade. In the first place the Government should not interfere with trade; in the second place the resources of the State should be found by direct taxation; and in the third place there should be strict economy in the services of the State. By direct taxation the burden could be laid fairly upon the rich, as well as the poor. The disadvantage of protection was that an undue proportion was pressed out of those who could least afford it. They had been told that foreign countries had adopted protection, and they had done it because it was a good means of wringing a large sum out of the people without knowing exactly how it was paid. Under free trade they saw how taxation was paid. The Government had failed in all three respects. They were the most extravagant Government the country had ever known; they relieved direct taxation instead of indirect taxation; and now they were trying to give the deadliest blow of all to the country by interfering with its commercial freedom. He appealed to free-traders opposite to stick to the principles which they had fought for in such a gallant manner and he was quite sure if they did this that victory would crown their efforts.

And, it being half-past Seven of the clock, the debate stood adjourned till this Evening's Sitting.