DEBATE ON THE ADDRESS.

HC Deb 24 February 1910 vol 14 cc355-469

Order read for resuming adjourned Debate on Amendment to Question proposed [21st 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. Illingworth.]

Which Amendment was, at the end of the Question, to add the words, "But humbly represent to Your Majesty that this House views with anxiety the state of trade and employment in this country and the failure of Your Majesty's Ministers to recognise the nature and gravity of the situation, and regrets that there is no mention in Your Majesty's Gracious Speech of any proposals for enlarging the market for British and Irish produce and increasing the demand for labour by a reform of our fiscal system, which would promote the growth and stability of our home trade, provide means for negotiating for the mitigation of foreign tariffs, and develop our oversea trade, through the establishment of a system of mutual preference between the different portions of the Empire."—[Mr. Austen Chamberlain.]

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

Mr. ALFRED MOND

In the remarks which I had the honour of addressing to the House last night I was pointing out that during the last election the "Birmingham Daily Post" produced an extremely novel, interesting, and fairly complete Tariff Reform scheme, and I said that I was under the impression that the right hon. Gentleman the Member for East Worcestershire (Mr. Austen Chamberlain) had endorsed that programme. The right hon. Gentleman corrected me, and said he did not endorse the programme of the "Birmingham Daily Post." I have here a copy of that journal of 10th December, and I read in an editorial that "the Tariff Reform scheme, the scheme contained in the 'Daily Post' of Wednesday, met with Mr. Austen Chamberlain's approval, as setting forth the main principles which must govern the settlement of the question." I propose to read the words of the right hon. Gentleman himself. He said:— Only yesterday as I came down from London I had the pleasure of reading an interesting and most able article in the "Birmingham Daily Post" which developed what in my opinion are the lines, the main lines, the great principles on which we should seek to proceed in this matter. I do not understand the relevancy of the right hon. Gentleman's interruption yesterday. If his words have any meaning at all—and I must confess one is getting rather doubtful nowadays as to the meaning of the words of eminent Gentlemen—they meant that the right hon. Gentleman approved the main principles laid down in this very able programme. Why I raise this point is because these main principles differ materially, very materially indeed, from the principles laid down by the leaders of the Tariff Reform party in the past, and we have to find out what Tariff Reform means, not as simply shown in that journal, but in the "Morning Post" and the "Standard" and other newspapers. The right hon. Gentleman the Leader of the Opposition, whose speeches I have followed and read with so much interest during the election, and, as I always do, I thought was at last going to disclose to a waiting nation that interesting subject, that fascinating topic, his constructive programme of Tariff Reform, and that great task; but whenever he got to it he always postponed it to a future occasion when he had more time, or a better opportunity, or perhaps a greater desire to explain it. The right hon. Gentleman has been well-advised. I understand that in the whole campaign only one candidate ventured on a programme and schedule, and he promptly lost his seat. He was standing for a shipbuilding district, and he produced his schedule, which proposed a low duty on plates. The shipbuilding interest said, "We are Tariff Reformers, but no duty on ship plates here." The right hon. Gentleman has certainly maintained a wise discretion. I understood that the right hon. Gentleman the Member for East Worcestershire was at one time looked upon as the leader of the movement; and here we have a definite statement of a fourfold policy of Tariff Reform—a penal tariff, a maximum tariff, a negotiable tariff, and a preferential tariff. This is very simple. I understand that that tariff is ready in the pigeon-holes of the Tariff Reform League offices—only it is never produced. We are to tax Colonial corn, Colonial meat, and Colonial manufactured goods; and I think before this Debate closes we are entitled to know whether or not in the official programme of the party opposite. Are you or are you not going to put a shilling duty on Colonial corn, and 2½ per cent. duty on Colonial meat, and 7½ per cent. duty on Colonial manufactured goods? If you are going to do so, then I think their view of Preference will be a rather different one from what it is. You have cut Preference down by 50 per cent. before you begin negotiations. If the foreigner pays the tax, is the Colonial not going to pay the tax? Then you are going to bind the Empire together by taxing your Colonial brothers—a grand policy of uniting everybody by taxing everybody else. There is a remarkable and amazing confession of what we have always suspected that this movement is nakedly and unashamed a Protectionist movement of the same character, of the same type, with the same vices, with the same absurdities as the Protectionist movements of other countries in the world. The English farmer is no more going to stand competition from his cousins in Manitoba than from his cousins in Minnesota. He is no more ready to be ruined by Australian mutton than by Argentine. The right hon. Gentleman the Member for Wimbledon will not let hon. Members for get it. In his speech at Manchester, which was a speech of the old Corn Law time, one heard of the old Corn Duties and high rents on agriculture presented, although you may now try and tell us the duties will only be small, although you may tell us the cost of living will not be increased.

The right hon. Gentleman the Leader of the Opposition, an economist of his standing, a philosopher of his lucidity, actually signed a statement in cold print that you can impose tariff duties without increasing the cost of living. Would the right hon. Gentleman get up in this House and say what country exists where the tariff has not raised the cost of the articles on which the tariff is placed? Will he contrast a schedule of articles of similar character in Free Trade England with Protectionist America or Protectionist Germany, the same articles side by side, piece by piece, and cost by cost? Will he not find almost invariably that the whole duty in every case, or a large part of the duty, has been put on to the article? During the last election I got, through the courtesy of a friend in Berlin, a complete outfit of the German working man—his clothes, his boots, his shirt, and everything. He said that the clothes came to 36s. I had them valued by a man of that line of business in my own Constituency. I got the best advice I could get. The man did not know what the things cost in Germany. I merely showed him the goods. I said, "What would those things cost here?" He said, "We do not have any things of such bad quality here." I said, "What would similar better-class goods cost?" and he told me the same set of articles came in England to 22s. 6d. There is an example of how tariffs increase the cost of living—not merely the cost of food, but the cost of living. I saw a statement of the Leader of the Opposition in a pamphlet that a scheme of imposing duties on food, on bread, on meat, on articles of clothing, and on articles of furniture will not raise the cost of living. I say that such a statement is a most cold, frigid, calculated, and ridiculous—I cannot use the word, as it might be unparliamentary, but calculated to deceive people who do not know better.

I know the economic arguments on which the other side endeavour to prove that a two-shilling duty on corn will not raise the price. The hon. Member for Dulwich, the only scientific exponent of Tariff Reform, who does descend to economic arguments, will tell you, if he speaks, that it is not invariably that the whole of the corn duty is borne by the importer. I quite agree, if the corn which came to this country from the Colonies came to 98 per cent. of our home supplies, a two-shilling duty might be ineffective, but it is not doing anything of the kind; it is not 50 per cent. I say that until you get from 50 to 08 that a two-shilling duty must be effective here, as in every other country in the world. Let me go back to the time of the Corn Laws. Our imports of corn were from 5 to 10 per cent., while 90 per cent. was grown in this country. How was it that at the time of the Corn Laws the price of corn was the English price plus the duty. How was it with the small import of 10 per cent. The whole of that duty was effective, and now hon. Members tell us whereas we are not getting one-half from our Colonies, that this two-shilling duty will not be effective, but will be paid by the foreigner. [HON. MEMBERS: "It was." Other HON. MEMBERS: "No."] I am glad to hear it was. The right hon. Gentleman the Leader of the Opposition is getting some information to-day. I have got here a quotation from a speech the Leader of the Opposition made on 15th May, 1903, in reply to a deputation from farmers, headed by the right hon. Gentleman the Member for Wimbledon, who desired to keep on the duty. What did he say:— The fact turned out, I am afraid, precisely as might have been anticipated: it turned out that the tax operated as a great burden on the raw materials used by the farmer. 4.0 P.M.

Why, if the foreigner paid the tax, did it operate as a burden on the farmer? He (the Leader of the Opposition) ended up a long speech in defence of the repeal of that Corn Tax by saying that the tax on foodstuffs used by the British farmer, which the farmers, or some of them, desired earnestly to maintain, amounted to no less than £582,000. The hon. Gentleman who interrupted me was, I think, too previous with a new-born zeal and little knowledge of this controversy, and had better be taken to a room and coached as to what his Leader's views were on a shilling Corn Tax in 1903. The Government paid back £600,000 to the millers of this country in the Corn Tax. The Treasury of that time did not imagine, and no Treasury to-day imagines, that the foreigner pays the tax. The right hon. Gentleman has not given us much light and leading during the campaign. In answer to a letter he said that there will be a rebate of duty on articles used in this country worked up and sent out again. But why a rebate if the foreigner pays the duty? What is the meaning of a rebate except the importer is paying the duty? The argument that the foreigner pays the tax may do for the wilds of Kent or Surrey, it may do for the people who know neither the foreigner nor the laws of economics, but it will not do and has never been employed on the floor of this House. The right hon. Gentleman the Member for East Worcestershire (Mr. Austen Chamberlain) was not very happy in his quotations yesterday. He cited a curious witness—our Consul-General at Frankfurt. The right hon. Gentleman having begun his quotation, might have finished it. I will finish it for him to-day:— Wages have increased in keeping with the higher level, yet I do not think, generally speaking, the German working men live as well as the British working man. There can be no controversy on this subject. I would lay down three propositions and challenge anyone who has investigated the subject, even superficially, to deny them. The German working men work longer hours, receive lower wages, can buy less for their money either in food, clothing, or rent than the English working men. You may examine the fiscal Blue Books published when the hon. Member for Dulwich (Mr. Bonar Law) was at the Board of Trade, or the fiscal Blue Books published since, or the reports of any intelligent or sane person who has ever written on the subject, or you may investigate the matter for yourselves: you will always come to the same conclusion. Hon. Members opposite seem to think that when they prove that the German working man is better off to-day than he was, they have established a case for Protection in England. But they have not proved that the fiscal system of Germany is applicable to England. Let the House consider for a moment a point which in this controversy is to a large extent forgotten, namely, that the trade of every country must develop along those lines which its fiscal system maps out. Therefore, the trade of a Free Trade country will naturally develop on different lines from the trade of a Protectionist country. England has developed those industries most, such as cotton, shipbuilding, and others which will naturally develop on Free Trade lines. If you interfere, as you threaten to do, with all those industries, if you try to reverse the current of industrial development which has been in existence for over fifty years, you cannot apply to England the system which has grown up in Germany or America. Those countries have industries which have grown up with their tariffs. No nation in the world has ever tried to apply to a complex industrial system like that of England a tariff suddenly, ruthlessly, or, I might say, at all.

The right hon. Member for East Worcestershire yesterday referred to the Bismarck Tariff. He said that wages had risen since the adoption of the Bismarck Tariff. It may be interesting to know that wages were rising much faster before that tariff than they have risen since. If you take the wages in Prussia, not after 1879, but between 1860 and 1870, you will find that the rate of progress be fore the tariff was greater than after it. German industry was developing more rapidly before the adoption of that tariff than it has developed since. [Several HON. MEMBERS: "No."] Certainly. If anybody studies that period he will find that Bismarck's assertions in 1879 about German trade were just as fallacious and just as inaccurate as those of the Protectionists to-day. I have known gentlemen who sat on the Commission with Bismarck in 1879. I have read all the details, and I wonder how many hon. Gentlemen opposite ever heard of it before to-day. The Bismarck Tariff of 1879 was a tariff for revenue, a tariff to unite the German Empire, a tariff to get him out of the financial difficulties due to Empire—it was not an economic tariff at all. The German Tariff ever since has been a tariff formulated by the agrarian party to keep up the price of corn and to retain people on the land because such people make better soldiers than others. But those ideals are not ours. No one here intends to revive the old Corn Laws. As far as I can see, under a Tariff Reform scheme the agricultural industry is to be sacrificed to enrich the manufacturing industries. Tariff Reform offers nothing to the farmer. What is the English farmer going to get out of the whole of the system, if food prices are to be lower rather than higher? Is that the doctrine which won the counties for the party opposite at the recent election? If Tariff Reform means lower food prices I think the right hon. Member for Wimbledon (Mr. Chaplin) will soon see that that state of things comes to an end. Our colonial brethren are not so innocent in tariff matters. Yet the stimulation of their industry to destruction by over-production seems to be the inviting prospect which hon. Gentlemen opposite hold out to the Colonies.

Then take the question of unemployment. The right hon. Gentleman said yesterday that we want more work for our people. We would all gladly have more work for our people. But have the party opposite ever pointed out how they are going to provide more work? I do not believe the right hon. Gentleman at any rate, with his knowledge of this question, still believes that we pay for our imports with golden sovereigns. He, I imagine, is not a follower of the old mercantile school of economics which still haunts the minds of most Tariff Reformers, who believe that all imports are loss and all exports are gain. He belongs to the more scientific school of Tariff Reformers, who believe that in some marvellous manner there is a magic in manufactured goods, that imports are paid for by exports, but that if you export raw material and import manufactured goods there is some mysterious loss in labour. Where is the evidence of that? I boldly assert that there is more labour value in £100 worth of coal than in £100 worth of any manufactured article. The very opposite of the Tariff Reformers' contention is true. The higher you go in the scale of finished goods, the greater the remuneration of capital, the greater the expense of sale, the greater the remuneration of supervision, and the lower the percentage of manual labour. Is it not a fact that of £100 worth of coal £70 represents wages? Of £100 worth of motor-cars, is there £70 wages? No. There is 25 per cent. for commission to begin with. On the building of a ship 50 per cent. represents wages, but on the machinery of a ship 50 per cent. is certainly not wages—meaning by wages manual wages, not the wages of supervision. [Several HON. MEMBERS: "Why not?"] Because in this discussion you are talking about giving more work to your workpeople; you are going to take the unemployed from the streets. It will take a great deal to convince me that I am wrong. My practice and my practical knowledge certainly confirm my theory.

The protectionist policy is based on another fallacy, on a fundamental misconception of trade, on the idea that people do not buy what they want and sell what they can, that you can compel people to buy what they do not want and sell to people things they do not wish to have. The right hon. Gentleman opposite says that we should change the character of our imports—that if a man wants a piano he will buy a bale of cotton, that instead of sending Welsh coal to the Argentine for their furnaces we should send them bicycles or motor cars. If we do not send them coal somebody else will, because they want coal. Foreign goods do not come here because the foreigner wants to send them; they come here because the Englishman wants to purchase them. I do not deny that by your tariff you can penalise the Englishman who wants to purchase the goods and put difficulties in his way, but you cannot compel him to buy something which he does not want. That is why the Protectionist tariffs of all countries are dismal failures and have never achieved their object. That is why every five years they have a tariff revision. If their tariffs were not failures they would not always be altering them. America has a tariff revision once every five years. If trade is bad they put the tariff up. If at the end of five years trade is still bad, they put the tariff down. And yet there is a blind, foolish notion that their tariff makes their trade. If the American nation ever remove their tariff, then, indeed, English commerce would have to look to its laurels. Our tariff was a failure when we had one, and that is why we did away with it. I would refer hon. Members opposite to a most interesting Blue Book which is not studied as much as it ought to be, namely, the Report of the Select Committee of 1840 on the tariff of that day. We had a magnificent tariff, widespread, covering 1,100 articles. There was a variety of small duties. It was at once a protective and a revenue tariff. The Committee said, how- ever, that those objects were incompatible—that where the tariff endeavoured to bring revenue it failed, and where it endeavoured to protect it failed also. The right hon. Gentleman opposite said that a tariff would work both ways, that if it did not keep out the goods it would, at any rate, bring in revenue, while if it did not bring in revenue it would keep out the goods. He admits at once the failure of the whole scheme. As far as Protection is concerned it is a failure, as far as revenue is concerned it is a failure, and where he has a double failure the right hon. Gentleman thinks he has achieved a great success. I do not want to detain the House long to go into this Report of 1840. [HON. MEMBERS: "Go on."] I would very much like to draw the attention of hon. Gentlemen to this Report—hon. Gentlemen who look at this matter from the revenue aspect. Why should we do all this work again, and then undo it again? This Committee appointed in 1840 did not contain any Cobdenites. Mr. Cobden was not a member of it, neither was Mr. Bright. It consisted of ordinary Members of the House, and they went into the question in a very businesslike way. They examined these tariffs from the point of view of revenue. I will just give you a few of the remarkable results of the information of the Board of Trade officials. It was found that in Schedule I. 349 articles produced less than £100 each of Customs Duty. Schedule II., containing 132 articles, produced between £100 and £500 each. Schedule III. contained 35 articles, which produced £500 to £1,000 each. In some of the Schedules the cost of collection was more than the entire duty. Then some very interesting evidence was given by an official of the Board of Trade. He showed that when the Customs Revenue of the United Kingdom was £22,000,962, seventeen articles produced 94½ per cent. of it, and other 1,100 articles produced practically nothing. I commend that to the right hon. Gentleman the Leader of the Opposition. There is nothing novel about this to anybody who has studied the tariffs from the point of view of revenue. Take Canadian, German, the United States, or any other tariff you like—the whole of these things were learnt in 1840, and with that lesson Sir Robert Peel simplified our tariff to what it is. I would ask hon. Gentleman opposite, at any rate, to study this Report, and study its conclusions, and I would ask them to give us not so many perorations or orations, or hopes, or aspiration, but a few more facts and figures, if, as they think, they are standing on the threshold of putting their policy into practice.

I have said in this House before that the business community of this country, whether they are Free Traders or Protectionists—whatever their views may be—are entitled to more information than they have had from hon. Gentlemen opposite. We can carry on business under a tariff. We can carry on business under Free Trade. But no human being can carry on business under an uncertainty. I know personally of a whole series of works that have not been started in this country since the Tariff agitation commenced. People would not erect them here, because they did not know the conditions under which they would be allowed to continue. Is that good for British trade? Is that good for the cause of employment? Tariff Reform, though it may benefit some industries, will not benefit them without imperilling others. Sir George Gibb, the late manager of the North-Eastern Railway Company, speaking on Tariff Reform, said that it would mean that that railway company would have to discharge 15,000 workmen. Do Tariff Reformers realise the meaning of the statement of Mr. Lever, of the Sunlight Soap Works, who said that Tariff Reform would mean that he would have to discharge 1,500 men? Why? Because his business is largely export business. And if you increase the price of his products you increase the price of what he has to sell, and he can no longer get the business he could before. Tariffs may divert industry, may divert capital, may divert labour, but they can no more increase the total volume of employment, no more increase the total investments of capital economically than any other nostrum which tries to force trade artificially, instead of allowing it to grow naturally. Tariff Reform means economic loss to this country. It means dislocation of trade so great that people are only beginning dimly to understand it.

I would like to read a resolution, and a very important one, passed, by whom? By a Radical body? By a body of Free Traders? No! By the Liverpool Steamship Owners' Association. What do they say? This resolution was passed at their meeting on a report made by Mr. Norman Hill of how tariffs would affect the port of Liverpool. It is a very interesting report, dealing, not with rhetorics or economics, but the very prosaic question of how much quay space Liverpool had, and how much would be required if the goods landed there had to be examined by Customs officers. The conclusion they came to was that it was desirable to maintain the existing state of affairs. They said, too, that it would be imperative, in the event of the introduction of a general Customs tariff on imports that adequate accommodation should be provided in the port, and that the discharging and loading of goods should be free from control by the Customs in the same way as was provided in the free ports of Germany.

I believe the right hon. Gentleman the Leader of the Opposition has made a promise upon the matter. I understand Liverpool was won not upon Tariff Reform, but upon a big poster that "Liverpool shall be a free port." You are beginning your victorious campaign by excluding people from the blessings of your new system! May I ask is London to be a free port? Is Swansea to be a free port? And if Swansea, how many more? Had you not better keep the whole country a free port? Protection is an absurd proposition that economically, from the point of view of business, and from the point of view of reason crumbles to pieces. Our great commerce has grown great, and been maintained great, on our present system, and I do not regard with anxiety the Amendment of the right hon. Gentleman opposite. I regard the issue with confidence, because there is no reason to be anxious. If we business men are only left alone to carry on our business the year 1910 will be a record year in English trade. Anxiety is a characteristic of Protectionists. Decaying industries is their favourite occupation. Bad trade is their panacea. Two bad winters and the people will do anything, take any pledge in order to save themselves from misery. But hon. Gentlemen opposite find that what they wish did not happen at the last election, and it will not happen at the next. Lancashire and Yorkshire, Wales and Scotland stand firm and determined to have this Question settled. No temporary triumph will ever stop us. Cobden had to convert the country to Free Trade under much more difficult circumstances. He fought and won. Although a momentary party fight may seem to leave the issue with you, you can rest assured that Free Trade in this country is more powerful than you have yet dreamed. This great fight will never die. It is bound to win. Our policy is founded on a broad principle, not of hatred of the foreigner, not on parochialism, but on the much bigger principle of national exchange of the commerce of this country in the markets of the world. This has made us great. We can maintain these markets if you only keep your hands off us, if you will only not impose upon our backs this clog which our forefathers took off, if you refrain from taking us back again to the blunderings and darkness of Protection.

Mr. SAMUEL STOREY

Although it is thirty years since I first came to this House, I have been absent so long that I must be a stranger to a good many here. The hon. Gentleman who has just ceased to address us said that this contest would not die out. I can promise him that it will not. He made the astounding statement that tariffs have been a failure everywhere, that those who adopt them are continually changing them. Yes, but will he tell us an instance in which they have got rid of them? Of course, they change them. They are sensible and scientific men. Their purpose is honest Protection in their own countries, and they alter their tariffs and modify them for the precise purpose of dealing with that question, and with that question alone. He based his hopes—or, shall I say, his prophecies?—of success upon the fact that Yorkshire and Lancashire, Scotland and Wales had not yet accepted Tariff Reform. [An HON. MEMBER: "And Durham."] And Durham and Northumberland, with perhaps a slight exception. Is he quite sure that the industrial classes of this country, the industrial centres, are so much opposed to Tariff Re- form as he thinks? [An HON. MEMBER: "Yes."] If you will take the chief cities in the Registrar-General's Return of 100,000 inhabitants and upwards, even at the late election, Tariff Reformers got sixty-eight Members and Free Importers only eighty-two. We have a total of 775,000 voters. They had a total of 803,000 voters. This is a difference of 28,000, which is not equal to the Irish vote. I cannot, how ever, follow the hon. Gentleman into the discursive points of his very interesting and able speech. The subject is a very large one. My right hon. Friend's Amendment covers a great deal of ground. Just as Tariff Reform has not one aim, so clearly it cannot have one method, and, therefore, there must be many points upon which we can dwell. The hon. Gentleman, in the latter part of his speech, at the fag-end of it, introduced one point of view that I regard as of vital importance. That was the question of the employment of the people. What does it matter, after all, if people have to pay a farthing more or a farthing less for a thing if they have no money wherewith to pay for it? I come from a part of the country where we felt the evils of unemployment in a special degree. If that had been the result of two years' bad trade merely I think I should not have taken quite the point of view I have, but when I know that in the shipbuilding industry in the palmy days of 1907–8 13 per cent. of the men who were regularly seeking work in our shipbuilding yards could not get work, then I know there is a deeper problem than the mere question of temporary employment. This question of unemployment is vital to the nation. This nation, any nation, requires as a condition of prosperity the maximum production of wealth each year by the maximum amount of labour and capital in the year, and this for purposes which every political economist tells us. Now it is evident that to secure this necessary maximum of wealth in the year for the purposes of the year the maximum amount of labour and capital must be employed. Therefore whatever hinders that, if any cause or any policy prevents the operation of capital and labour being employed, the effect is mischievous; if it prevents the large operation the effect upon national prosperity is fatal. Three results ensue, which are well worth noticing in a House that in my judgment talks too much about foreign trade and too little about home production. Three results, distinctive and cumulative, ensue. First of all, the labour cannot support itself, and the capital naturally migrates. Secondly, the unemployed are a tax and a burden upon those who are employed, and, thirdly, the unemployed being without wages to buy deprive those who are employed of a market for the goods that would cause further employment.

Let us apply these general considerations to the particular question we have in view. First of all I would like to make the humble confession to those ardent supporters of Free Trade philosophers and teachers. All I know about this matter I drew from Adam Smith: all I believe I believe from his teaching. When I was of the age of the hon. Member who has just sat down (Mr. Mond) I held Adam Smith's principles as Gospel truths. Now, when I am as old as I hope he will happily come to be, I hold them with equally implicit faith, and nothing that I have said during the Debates that have taken place in the country, or that I shall say here will, I hope, conflict with his established teaching if it be properly stated and properly understood. He taught me, for instance, this: That capital and labour employed in a country are many times more valuable in producing employment than if employed outside, because labour and capital employed in the country result in two reproductions of capital and in two sets of employment, and in a lesser time. He taught me, secondly, that foreign trade, though important enough if it flows from surplus capital, is of secondary importance, since it results only in one reproduction of capital and one provision of work for our people and that in a longer time, and, thirdly, he taught me that therefore the greatest general prosperity and the greatest amount of employment and wages for our workers are best to be secured by the encouragement and fostering of home production. I accepted these principles, as I have said, and I accept them now. But I notice one thing about Adam Smith—I do not know myself whether, if he had lived to-day, he would have been a Tariff Reformer, I think it probable that he might, but I am sure of one thing—in his own day he never advised a theory, never laid down a principle as true without first bringing it to the test of the fact and circumstances of the time. He did not live in circumstances such as we have to endure, and I think if he had been alive now he would reconsider all his principles and all his feelings in the light and circumstances and facts of our time. They might have produced a change in his views.

I ask this House is the condition of unemployment satisfactory? [An HON. MEMBER: "No. Is it anywhere?"] Has it been satisfactory for years past? Is the conditions of the millions satisfactory? [An HON. MEMBER: "No."] Has it not grown increasingly unsatisfactory? [An HON. MEMBER: "We have had record years."] That is just the mistake hon. Members make. They take a year here and they compare it with a year there; whereas you can only manage to come to a reasonable conclusion if you look at the whole period taken together. I am too old and too disillusioned to be once again a strong party man. I care very little for the cut and thrust of debate. I think this Question of employment and the comfort of the people is of such a vital nature that it ought not to be dealt with on party lines. I hold it of so much importance that I put it on the same level as the defence of these shores from a foreign foe, and that, happily, has always been considered on national and not on party lines, and if it has not it ought to be, and I consider the defence of the trade and commerce and the question of employment and the industries of this country is of equally vital importance and ought to be treated by the House in a similar spirit.

There are two diagnoses of this great disease. I turn first to the Labour party. They deplore as much as the rest of us do the present condition of things. They claim to represent in this House the manual labour of the country, and they have at their backs the trade unions of the country. I admit their claims, so to speak, although I sometimes think—I did so yesterday when I heard the speech of one of the Labour Members—they seem to ignore the fact that there are other gentlemen in this House equally well fitted and equally competent to speak for the working classes. What is their view of this unemployment?—not theirs exactly, but of the Trade Unions Congress of which they are the representatives. The Trade Unions Congress consists of the very pick of the working men of the trade unions of the country. They know what they are talking about and in September, 1908, just sixteen months ago, they passed the following resolution:— That the state of unemployment in this country is chronic is now permanent in character, in the busy as in the slack seasons, in summer as in winter, and is common to all trades and industries

An HON. MEMBER

"And to all countries."

Mr. STOREY

That is rather a different picture from the picture which the hon. Member opposite drew. They recognise that they suffer in exactly the opposite way to what this House does: since this House has always more work than it can do, while for the people of the country there is not enough work to go round. The Trade Unions Congress knew what they were talking about. They have possession of facts which I imagine, although the hon. Member opposite seems to be ubiquitous in his knowledge, he is not possessed of. For instance, the trade unions of the country know day by day and week by week this: That boys, the sons of trades unionists, cannot now, in sufficient numbers, find places in the trades of their fathers.

Mr. J. M. ROBERTSON

When could they?

Mr. STOREY

Why, before now, and as a consequence, they have to stand down at the beginning of life. They know that their members fall out year by year from their societies and become casual labourers again settling down in life. They know that these figures which the new President of the Board of Trade (Mr. Sydney Buxton) felicitated himself upon yesterday as showing diminishing figures of unemployment have to be discounted by the fact that this year, at the very time that the figures are apparently falling, many thousands of men, members of trades unions, have been unable to keep up their subscriptions and have fallen out of the ranks and are no longer counted as members, and have, if these had been included, these men who are out of work, the right hon. Gentleman would not have reason to felicitate himself as he did. They know that though there may be apparent wages, there are, over large sections of the country, short time, hours by which men get smaller wages, and they know that the cause of the unemployment of their trade unionists is enormously increased, not this year only, or the year before, but steadily during the past ten years. Ten years ago the hundred trade unions of this country, so the President of the Board of Trade tells us, paid a quarter of a million in unemployed relief. It went on growing and rose to £500,000 a year, and unless I am utterly mistaken, the trades unions this last year have paid out of their funds more than three quarters of a million sterling. In other words, in ten years their members have increased 15 per cent., but their expenditure upon out-of-work has increased 200 per cent. No wonder the Labour party realise the actual condition of things. What is the idea of the Liberal party upon this question of unemployment. They do not believe that they have to deal with a permanent cause and a permanent evil. They airily tell you that the evil is here, but it is only temporary. [An HON. MEMBER: "No."] They say it is such as we have had before, and such as we shall have again. Having made that mistaken diagnosis of the disease, what follows? They have been five years in office, and of all the great deeds they have attempted no one, in my judgment, is so great in its possible effects as would have been a real attempt to deal with this question of the unemployment of the people. They have offered us palliatives, Parliamentary doles which abate independence, uneconomic works which reduce wealth, and Labour Exchanges with few jobs to get. According to the Labour party the nation is ill of heart disease, and the Government give us bread pills to cure it. I believe that for every permanent evil there is a permanent cause, and I believe the permanent cause lies in our having departed from the true teaching of our great Free Trade philosopher Adam Smith. What is his teaching in this matter? His main teaching was that the first object of political economy, considered as a branch of the work of a statesman or a legislator, is to provide a plentiful revenue or subsistence for the people; or, more probably, to enable them to provide such a revenue for subsistence for themselves. I believe that our habit of buying more and more abroad things we could produce in our own country is the main cause of the lack of the development of our productive industries at home, and the consequent lack of employment. That policy was defended in times past by my- self upon many occasions as good, because it produced us cheap food, and because, if labour and capital were driven out of one avenue, they could so easily enter another. The first is no longer tenable. We have not cheap food, and never shall have again until we produce it for ourselves. We can never have a satisfactory state of things whilst the price of our bread is fixed in New York, the price of our bacon in Chicago, and the price of our beef in Argentina. Every article we produce is subject to a keen competition in our own market. The good results which followed that policy in other days are gone, and the evil result of unemployment remains. I endorse the diagnosis of the Labour party. I agree that it is a permanent and a vital disease. Not only is the diagnosis of the Labour party true, but it must be apparent to anyone who considers the facts. We are not making proper use of our own national advantages, and that is the key to the situation. Take the land.

Mr. JOHN WARD

We are after it.

Mr. STOREY

How shamefully we misuse this great source of wealth! The land does not produce a quarter of the wealth which it ought to do, and it does not employ half the labour that it otherwise would do. Take as an illustration the period between 1851 and 1901. In the year 1851 England and Wales, with a population of about 15,000,000, had 2,000,000 working on the land, or nearly one-eighth of the population. In the year 1901 England and Wales, with a population of 32,000,000, only had 1,000,000 people working upon the land. It is apparent to every person who looks into these facts that if 2,000,000 could be employed on the land, instead of 1,000,000, as was the case in 1851, the labour difficulty in many of our large towns and cities would be largely solved. I believe every section of this House will agree with that. The bearing of this upon unemployment is apparent to everybody. How are you going to get the land employed? There are three proposals before the nation. First of all, the Labour Members of this House propose to acquire the land and work it under the direction of a bureaucracy. The Liberal party is also anxious that we should have the land better used, and what is its method? It proposes to recreate British industry by the aid of tenancies under county councils. I have had something to do with county councils. I believe the Government rather prides itself upon the success of this little Act. But if they only knew the character of the applications and the true character of the bulk of the allotments and small holdings, I do not think they would see much reason to be proud of the result. In any case, you will not under such a system get the maximum of wealth out of the land, because to do that you must have the magic of property in it. Land reform and occupying ownership must, in my judgment, form an integral part of the Tariff Reform policy. In answer to the criticism which the hon. Member uttered about prices, I venture to say this plainly—if the House could contemplate, in some not very remote future, the land of England passing from its present ownership—I think the mixture of large estates and small estates is best for agriculture; if the House could imagine the land under occupying owners producing all they can get out of the land, I think it should be clearly understood that under such a system the owners would demand, and would have a right to demand, that they should have such prices for their commodities as would enable them to live and become prosperous.

Mr. C. DUNCAN

Tell us something about Tariff Reform.

Mr. STOREY

The hon. Member asks me to tell him something about Tariff Reform, but it is very clear from his observation that he has not yet understood that subject. If our land has not been used adequately for the employment of the people it follows that the people cannot be employed productively unless our manufactures have increased with the growth of the population. They have not done so. Take, in addition to agriculture, our great textile trade and our iron trade in its entirety, and you will find that in the case of those three great productive industries during the last twenty years, although the population has very largely increased, the number of persons employed in those trades has not so increased.

Mr. A. H. GILL

That is not so in the textile industry.

5.0 P.M.

Mr. STOREY

If the hon. Member adds the three together he will find that I am not so far wrong. When you find that in the three great industries of agriculture, the textile trade, and the iron trade there has not been a growth in the number employed equal to the growth of the population, surely it is clear that that is a cause of the lack of employment which we are all deploring. How is it they have not increased? It is because they exist under conditions where they are the victims of hostile competitors and our own foolish policy at home. Just a word as to the remedies we propose. We have a remedy which is much scoffed at. We are called Protectionists. I do not care myself what people call me, I only desire to admit the facts. The Labour party are Protectionists. Why do they object to us? Is it because, whilst they only claim to protect labour, we claim to protect not only labour, but the capital of the country, which we regard as equally essential to its prosperity? You may call me a Protectionist if you like. What I aim at is not Protection, but to restore those natural conditions of industry which Adam Smith says is the first condition of prosperity. You may restore those natural conditions in two ways. You may restore them by universal Free Trade. I do not know whether the Government has it in its eye to secure that for us, perhaps by Resolution of this House. There is another way in which you can restore natural conditions or come near to them. If two men be fighting and one has his hands tied and the other both his hands free, that is unnatural. To unloose the hands of the man who has them tied will make natural conditions, but to tie up the hands of the other man will also bring about pretty nearly the same result. We cannot get universal Free Trade, but we do claim we can restore as near as possible the conditions which would exist under Free Trade. In the time of Adam Smith England had two natural advantages. She had first a natural advantage in the matter of transit, and she had the second advantage that she was at least as free to sell to other people as they were to her. Both these natural advantages are gone. We are free to-day to buy from anybody, but we are not free to sell to anybody. We are not free to sell to competitors who are free to sell to us.

In urging upon the Government this course I would ask them for no sacrifice of principle. I have been a Liberal so long that I continue a Liberal in the true sense still, and I would ask the Government for no sacrifice of principle in meeting the purpose we have in view. They tax food heavily now, and we desire them to do no more than that. They protect cocoa and tobacco, and without any sacrifice of principle they can extend the same protection to all manufactured goods. They have it in their power, without offending against Adam Smith, not to insist upon an Excise duty because there happens to be a Customs Duty. If they would but follow Adam Smith in the matter they could very easily arrange that home-grown beetroot sugar and home-grown tobacco should not be subject to an Excise Duty. It would have a more powerful effect in improving the agriculture of this country than any proposal they have yet made. They have induced factories to come here by their Patents Act. The hon. Member for Swansea (Mr. Mond) says they will not come, but we are quite willing to take any number of factories from people abroad so long as they give employment for the people of our own country. We ask them to make not revenue, but the employment of people and the creation of a subsistence and revenue for the people by employment the main purpose of their fiscal policy. I thank the House for having listened to me. In all that I have said, except by occasional lapses, I have not fallen much into party forms of speech. Really, the Question to me is so vital, especially in our part of the country, that one must make some attempt to induce hon. Gentlemen opposite to try and look at it from our point of view. We want no Protection; we want equality of opportunity. We want the fiscal arrangements of the country so dealt with as to secure for us the maximum employment in our own land, by our own capital, and of our own people.

Mr. W. BRACE

We have listened to a most interesting speech, but a speech none the less dangerous because it has been couched in courteous and kindly language and delivered in the name or on behalf of labour. One great complaint we had as a labour people during the last contest was on account of this great, cruel, and very nearly criminal attempt on the part of politicians to exploit the despair of our fellow men for party political purposes. The hon. Member who has just addressed the House has been good enough to read a resolution as passed by the Trade Unions Congress, and he based on that resolution the statement that the trade union leaders knew their business. It is because the trade union leaders know their business so well that they are not going to be side-tracked by any such proposal as we find embodied in the Amendment moved by the right hon. Gentleman the Member for East Worcestershire. We stand for dealing with unemployment. Who in this House or out of it can be better qualified and better fitted for dealing with the problems of employment than the men who are kept here out of the pence of our own fellow men who make their sacrifices? It is because the workers of the United Kingdom think that the Labour Members of Parliament have a special knowledge which will enable them to co-operate with any movement in this House to bring about a reform for dealing with unemployment upon lines of safety and permanency that so many of us have been sent here on this occasion to do the work of the House of Commons.

I noticed it was dissented from when the charge was made that the Opposition in the election campaign declared that if they were supported there would be work for all. I read a most interesting correspondence in which the Patronage Secretary of the late Conservative Government was asked to give an explanation and in which he was compelled to admit that Tory vans went out under the auspices of the head Conservative organisation with the statement, "Vote for Tariff Reform and work for all." It is rather too late in the day for hon. Members to come to this House after they have misled the electorate and to declare that all they meant was that there would be more employment under Tariff Reform than under Free Trade. Had they told the electorate that in the late contest, I venture to express the opinion that many of them would not be Members of this House at the present time. Let me deal with the question of unemployment as I see it. The credential is given to us that as Labour leaders we do know the conditions of the working man. Is it not a remarkable fact that there is not one Labour leader in the whole of the United Kingdom who is not an opponent of Tariff Reform? No hon. Member will venture to say that the Labour Members of this House or the trade union leaders of the country are under any obligations to any man or to any institution to oppose Tariff Reform. We oppose Tariff Reform, not because we are paid so to do, but because we are persuaded that, inasmuch as Tariff Reform starved our fathers and mothers, it will starve us and our fellow workmen if it is tried now. Is it not a further remarkable fact that there is not a Labour leader in America, or in Germany, or in Austria, or in France, or Belgium, who is not an opponent of Tariff Reform?

An HON. MEMBER

What about Mr. Gompers in America?

Mr. BRACE

Mr. Gompers happens to be a personal friend of most of us on these benches, and therefore, when I state that he is not a supporter of Protection, I think the House will pay me the compliment of accepting that as a true statement of fact. How does the hon. Member propose to get the people back to the land? By his 2s. per quarter tax upon corn. Why, farmers laugh at the idea. It so happens that I represent a constituency which has a very substantial number of agriculturists, and when I talk to them in Glamorganshire about what effect a 2s. per quarter tax upon corn would have on their interests, and I ask them whether it would pay to depart from their system of farming, which is upon the basis of stock raising, and break up their land for corn growing, they laugh at the idea altogether. It is only 2s. per quarter upon corn that the Tariff Reformers offer to the agriculturists to advantage British agriculture in any shape or form, but on the other side of the balance sheet farmers do not forget, if Tariff Reformers forget, that they would have to pay increased prices for the agricultural implements necessary for their farms, that they would have to pay increased rates for all the food stuffs necessary for the feeding of their stock, and that they would have to pay increased rates for all appertaining to their own lives and to the lives of the men they employ. Therefore, when they have such a proposal as a 2s. duty per quarter on corn put before them they laugh it to scorn, and they vote for me every time and against Tariff Reform.

So much for agriculture. But there are other interests in this country besides that. We hear it often said that trade follows the flag. As a matter of fact, trade follows the ship. We have had a good deal of flag with a very little trade. Trade follows the ship, and the country that possesses the greatest proportion of shipping tonnage in the world is the country which is going to have the biggest share of the world's trade. If our fiscal policy were all wrong, as the Tariff Reformers say, is it not remarkable that under our system of Free Trade we have been able to build a mercantile marine which at this moment gives us more shipping tonnage than all the rest of the world? All other countries recognise the importance of a, mercantile marine, and that is demonstrated by the fact that in Protectionist America they have either abolished or reduced to a minor point the taxes upon every article that goes to the building of ships, and in Germany they have absolutely wiped out all those taxes. In Germany to-day the ports are as free and open for every article that goes to the making of a vessel as any port in the United Kingdom. What stronger argument could be advanced in favour of our own fiscal system as compared with that of Germany than that when Germany has to meet us upon a foundation in which competition determines whether they will have the trade or whether we shall have it, they have not forced us to adopt their fiscal system, but we have, by the cheapness of our productive capacity, been able to wipe away all their tariffs and to make Germany absolutely Free Trade in these matters? It is very remarkable—shipping being so important—that Tariff Reformers seldom refer to it. I remember when the right hon. Gentleman the Member for West Birmingham—whose absence from this House we all so much deplore—came down to Cardiff to speak, I went to his meeting with quite an open mind. There were two things I thought he would deal with—shipping and coal—but he had not a word to say upon them! Fancy any statesman or politician coming down to Cardiff to address a body of electors in that great city, which is so entirely dependent upon shipping and coal, and saying not a word upon matters which are of vital interest to that particular community! To the credit of the right hon. Gentleman let it be said that when the Leader of the Opposition came there he took a like course, and when the hon. Member for Dulwich, who is to speak later in the Debate to-night, put in an appearance at Mountain Ash to take part in a demonstration there, I looked in vain for his references to shipping and coal.

Now these two subjects are of some importance to large bodies of people in this country, not only to those who have to make their living out of the industries, but also to large accumulations of capital. Therefore it is necessary for us, whose constituents have to make their living in these industries, to see where we stand in connection with shipping and coal. The other day—not a very considerable time back—the hon. Member for West Mon-mouth was deputed with myself to inquire into the competitive capacities of Germany and America with regard to British coal. To our astonishment we found when we got to Marseilles that coal from Cardiff, which was two shillings per ton dearer than that from Newport in America, when it reached Marseilles could be sold two shillings per ton cheaper. The explanation was that the coal sent from America was despatched in ships which had to return in ballast, whereas that forwarded from Cardiff was carried in vessels which brought merchandise back, and that therefore halved the cost of freightage. The result was, we found, we had absolutely crippled America in her severe attempt to get hold of the markets of the Mediterranean. Yet when we are asked to consider a scheme of Protection in the place of the present fiscal system of the United Kingdom, we are not told a word—not one word at all—as to the effect that scheme is going to have on these two great industries! We say in connection with agriculture, in connection with shipping, and in connection with coal, that the men who are engaged in those great industries have made up their minds, whatever they may be called upon to face, whatever trouble they may be faced with, that the line of solution of their problem does not go along the line of Tariff Reform, but that it does go on the line of Land Re- form, and it is because the Labour party believe in dealing with this problem of the unemployed at the root we are accepting not the proposals of the Amendment, but those embodied in the Budget, and we are accepting them as being a much more sound basis on which to attempt to erect a great social fabric and to secure for our people a higher standard of life than they now enjoy. I marvel at the audacity of politicians who come to this House and who pay the Labour Members the compliment of saying that they know their own business. I say I marvel at their audacity when we come forward with schemes for dealing with the great unemployed problem—when we come forward with our Right to Work Bill, in which we ask for a man not the right to beg or steal, but the right to work, so that he, without loss of dignity or right of citizenship, may have an opportunity of winning bread for his family rather than be dependent on the charity of the nation. Our right to work plan is side-tracked by Tariff Reformers who come here and, in a most extra- ordinary manner, talk to us about the troubles of the unemployed, and yet, when they are asked for their solution of the difficulty, offer only the proposal that this country shall adopt a fiscal scheme which Labour leaders in America, in Germany, in Austria, in France, and in Belgium have warned us with all solemnity and in all seriousness, that we cannot accept. We have come to this House with a keen anxiety to deal with this problem of the unemployed, but it is not upon the lines of Tariff Reform that we can do it. We have never deceived ourselves, as some people have done, on that point. We know our people will not gain by Tariff Reform. We know that the great landowners of the country will certainly gain. We know, too, that the great international financiers will gain, but at the same time we are well aware that the faces of our people will be ground into the dust by that policy. It is not Tariff Reform that we want. We want a reform on lines that will give a greater promise than is embodied in this Resolution, and I would say here that I resent most strongly that any promise should be made to the unemployed for political purposes which there is no reasonable hope of fulfilling. To exploit the despair of a man out of work is a most cruel thing. A man out of employment will be prepared to vote for anything which offers a promise of giving him work. Every placard in this election, while the formula has been altered from "Work for all" to "More employment for everybody," has conveyed the impression that Tariff Re- form means more employment and higher wages. If hon. Gentlemen believe in that, while I give them credit for their sincerity, I must confess I do not comprehend it, and neither can I compliment them on their knowledge. Where do they expect to get higher wages from? In this fiscal scheme is there any hope that we shall gain any advantage? I say that under it our capacity for employment will be reduced and our earning power will be materially decreased. The cost of production must increase. It has been stated that by the erection of tariff walls more employment will be secured for our industries. Is that the case in Germany? Germany has a very high tariff wall, but if you take the number of men employed in the mining industry of the United Kingdom and the number of men employed in the mining industry of Germany during the last ten years, what do you find? I take the coal industry, because coal is raw material for every industry, and, therefore, if the argument put forward by Tariff Reformers is sound, it must demonstrate itself in connection with that industry. I have been astonished to find that the United Kingdom, with its comparatively old coal-fields, gave more employment to men than Germany with its modern coal-fields and its tariff walls. In the face of this, can we come to any conclusion other than what ever may be the advantages of Tariff Re- form, it cannot benefit the workers that we represent. No doubt hon. Members opposite are in real sympathy with the problem of the unemployed, and with all attempts to solve it, and when we have an opportunity of introducing our Right to Work Bill—or rather when, as I most strongly hope, the Government introduces it—I hope that sympathetic language, such as that uttered by the hon. Gentleman who has just spoken, will be put into action with a view to finding work for our men and women; I hope, too, that the problem will not be treated as a political or party question, but as one entailing a solemn obligation upon every Member of this House. People talk to our men and to us as if it were possible for everybody to acquire wealth, but we realise the economic truth that it is impossible. For every millionaire that we have, you must have millions of people who do not know where to turn for their next meal; and too much emphasis is laid upon capital and the protection of capital in the House, without due regard being given to the humanitarian side of the problems we have to face. It is because the Labour party do not believe that the Amendment proposed from the Front Opposition Bench contains a hope of dealing in a satisfactory manner with the problem of the unemployed, that we shall, without reservation, unanimously go into the Lobby to vote down the proposal, and by that means enter our strong protest against the unemployed problem being made a stalking-horse for winning votes at election times, with no intention of co-operating with us who know this problem in such a way as will bring it to a solution and carry hope into the homes of the people.

Captain TRYON

I hope this House will extend indulgence to one who addresses it for the first time. I believe that that indulgence is one of the many chivalrous traditions of this House. In listening to the last speaker I have been asking myself whether a conference could not be arranged between the various parties who are attacking Tariff Reform. I should like to know if they could not make up their minds whether the country is going to be starved with corn so dear that we cannot import it, or whether the farmers are going to be ruined owing to the inadequacy of the taxation put upon imported corn. A conference would be very interesting. Dealing with this question of unemployment, I should like to turn to the one case where I think the Free Trade Government has done something for the unemployed, which is a case in which it made a Protectionist experiment. When you look at the Patent Law Amendment Act you will see that it infringes some of the most sacred laws of Free Trade. Free Traders tell you that you ought to buy from abroad just as much as you buy from at home, because it gives just as much employment to buy from abroad. Free Traders tell us that works ought to be put up in any foreign country where goods may be best made, but the Patent Law Amendment Act says the goods are to be made in England. That is Protection.

That Act has this effect, that anybody holding a patent must make his article for this market mainly in England or forfeit the patent. Our opponents say that the forfeiture of the patent is a movement in the direction of freer trade, and so it is, but those who argue that way are getting somewhat confused, because that is the punishment inflicted by the Patent Law Amendment Act if it does not attain its purpose. The purpose is to get the article made in England. The Act distinguishes between various countries of the world, and says in effect, "If you do not put up your works in England we shall cancel your patent." What is the result? The Chancellor of the Exchequer tells us in one of those vague references to statistics which appear in his platform speeches that employment for hundreds and thousands of men is going to be given, but the fact is that employment is going to be given which would not be given if it were not for the Protectionist method employed. Why not extend that method to every other article which might just as well be made by our own people? Supposing that could be applied in order to deal with the manufacturer, whom you cannot get at by the Patent Law Amendment Act, and supposing you say to him in effect, "If you import from your foreign works you will be attacked by the same duty."

What will happen? There are three courses open to the foreign producer. He will lose the market and abandon the attempt to introduce the goods, and then we should make them in this country. Or, again, he could cut his price and forego some of his former profits, and if he does so he makes a direct contribution to the Chancellor of the Exchequer, whose coffers are, I understand, not too full. He has one more alternative. He can come over to this country, put up his works, and compete with our own manufacturers, thus giving additional employment to the working men of this country. We had somewhat of a lecture from the hon. Member for Swansea, and we were told by some other speakers on the benches opposite that the claim for Tariff Reform is due to the action of a few rich manufacturers, but when I look back into history I see that men like Alex. Hamilton, Abraham Lincoln, and Bismarck were Protectionists, and I think that no one would be inclined to charge them with changing the policy of their country at the instance of a few rich manufacturers. But I understand that that charge has now been withdrawn. At the Cobden Club Conference which occurred some time ago a gentleman named Bailey—Sir William Bailey—said he thought that it was a good test of a man's sanity whether or not he was in favour of Free Trade. That is to be the new test, and it is interesting to know that we who favour Tariff Reform, and those other people whom I have referred to, have not the intellectual capacity of Sir William Bailey.

Then we are told that you cannot shut out the goods and also collect a revenue on letting them in, but that has been answered by no less an eminent authority than the Lord Advocate—a very famous speaker, for the other side. The Lord Advocate said, taking the manufactured imports that we could levy 10 per cent upon £42,000,000 of foreign manufactured imports, and asked, What would be the effect of that? He said that it would be that half would be kept out, and we would make the goods ourselves. I do not know whether that portion of the Lord Advocate's speech is very frequently used in addresses to the unemployed by speakers on the other side, but he goes on to say that the other half of the goods would come in, and that we should get revenue. That is an admirable statement, absolutely disposing of the argument that you cannot create more employment in this country by a tariff and yet collect your revenue. The Lord Advocate says you can, and it must be true. But another authority, the Home Secretary, has told us to beware of Tariff Reform, because it will cost such a lot to levy the duty. The Home Secretary, who has since been promoted, said that it would cost £750,000 to collect the duty under Tariff Reform, and that was a very notable effort, but he has been entirely thrown in the shade by another Free Trader who came along and said it would cost £2,000,000 to collect this duty. I have been asked if it was the Lord Advocate who made that statement, and it was the right hon. Gentleman. But he is rivalled by a speaker who on another occasion said it would cost £4,000,000 to collect this revenue, but he is not disgraced, because the gentleman who said it would cost £4,000,000 and the gentleman who said it would cost £2,000,000 are one and the same person. Therefore we are in this interesting position, that we have three estimates from responsible members of the Cabinet as to the cost of collecting the tariff under our system and they differ. Of course, everybody is entitled to his own opinion, but apparently the Lord Advocate has two.

There is another very serious point which is put forward by the same eminent authority. He tells us that Tariff Reform will lead to so much smuggling that it will be undesirable. I wish some of those very eminent authorities on finance on the opposite benches would tell us why a duty of 6d. per hundredweight on corn is to cause more smuggling than the 6d., as it was at that time, on tea. If the Lord Advocate should lose his present exalted position, possibly he might be able to pick up a living on those estuaries in the North Country in smuggling pianos and steel rails, which, according to his mind, are so much more easily smuggled than cigars and tobacco, on which there is a duty of 600 per cent. There is another and more serious question, namely, that of negotiation. We are told that you can rely upon the "Most Favoured Nation Clause," which is called the sheet-anchor of Free Trade. It amounts to this, that supposing France is negotiating with Germany, and says, "We will grant you concessions if you, in return, will do something for us," and France gets, we will say, lower duties on her products, then Free Traders ask us, "What more can you want? You get the same advantages under the German tariff that France is getting"; but the point is that France has got a lower duty on claret, and we do not grow claret. Mr. Cobden, whom I do not hear much quoted in these Debates, when he found that his policy was going to break down, went to France and negotiated because he had a tariff at that time to bargain with. He made a treaty with France in which he got some substantial concessions for our trade, but he did not believe in the "Most Favoured Nation Clause." He asked for concessions in regard to articles we do produce. He asked for lower duties on iron goods, lower duties on our manufactures which we wished to send to France, and he got them, but he got them because in those days we still had a tariff with which we could negotiate.

Then comes the question, granted the necessity for negotiation, Whom do you negotiate with? Clearly, first and foremost, with our own Colonies. We go first to them because their offer has been standing for years. There are some on the other side who say at political meetings that there is no Colonial offer, but can anybody on the other side say in this House that there is no such offer? You cannot say there is no Colonial offer because you remember who it was who banned it and barred and bolted the door against it. We are told that the concessions are no good because you cannot get into the Canadian market. But I have examined the figures and find that before we got our preference in the Canadian market our trade had gone down. Up to the very year when the Government refused the last Colonial offer, however, our trade with Canada had been multiplied by more than three, and we claim that a system of tariffs under which our exports to Canada have been trebled is clearly not a tariff which shuts out our goods. Furthermore, when we hear Members on the Labour Benches say that Australia does not mean to admit our goods, I should like to know why in the Tariff of 1907 there was a provision to allow English goods to come in free and to exclude goods if they came from foreign countries? That shows no evidence of an attempt to shut us out.

But there are issues which are over and above all these things—the issues of Imperial unity. I am not one of those who much care for appeals to authority. I prefer to try and think things out for myself. But if you take the case of the United States you will see that the man who did more to federate and found the United States than any other man was Alexander Hamilton. If you read the Federalist Letters, which are not very easy to get in this country, and if you read the whole campaign in favour of unity, if you study his great report on commerce and manufactures, you will see that Alexander Hamilton, when he federated the United States, made the question of commercial unity part and parcel of political unity, and the results have justified his views. Go to Germany. You would have seen there forty or fifty years ago a number of scattered communities with different governments, different religions in some cases, divided by many things that keep people apart, but Mr. Cobden visited Germany, and he foretold that the Zollverein, the binding influence of commercial union, would some day bind all the scattered elements of Germany into one great people. I must admit that our opponents have had the courage to throw over Mr. Cobden on almost the only occasion when one of his prophecies came true. When you look across the seas and you realise that we are here with perhaps 40,000,000 people, and you see in Germany 60,000,000 and in the United States about 80,000,000 people, and you see these great Powers developing faster than we are, when you see that since Germany introduced Protection her emigration has almost ceased, when you see that her great natural increase gives more to her than our small increase gives to us because her people stop in her country, then you will see that we cannot, in the long run, maintain our place among the nations, against the growing power of Germany and of the United States, unless we use the whole power of the State to develop our trade. If we adopt Colonial preference and duties on foreign corn it is not from any desire to increase the cost of the food of the people. The only difference in food taxes between us and our opponents is that our opponents tax food wherever it comes from, whereas we hope to leave large supplies of British produce untaxed. We believe that our naval supremacy, our power to keep the seas open, our power to keep our place among the nations, absolutely depends on our, firstly, increasing the commercial power and adding to the productive power and finding employment for our own people here, and it is not from any desire to tax food, but because we want to bring the whole Empire into this great Imperial scheme, that we propose to accept the Colonial offer. We propose to accept it because we believe that this great, new national system which is developing, and which will soon, I believe, be carried to victory, is a policy which should be based, not on the narrow limits of our islands, but on the broad and wide foundations of the whole Empire.

Mr. CRAWSHAY-WILLIAMS

The fact that I represent a great industrial constituency which has given so emphatic a verdict on this Question is my excuse for endeavouring to set forward my views on a subject on which I am in harmony with so great a majority in a town which, to a large extent, depends for its entire existence on the maintenance of our present fiscal system. I should like to refer to some observations made by the hon. Member for Sunderland (Mr. Storey). He now recognises that we have a home trade. He has to be congratulated upon that because, at the beginning of this controversy on the fiscal question, I think the right hon. Gentleman who initiated the controversy was rather apt to forget that we have a home trade at all, and to measure our prosperity simply and solely by the volume of our exports. He is also, I think, to be congratulated on the fact that he has realised that it is not always fair to take one particular year, and compare the statistics for that year with the statistics for one other particular year, but that it is fairer to take a series of years and compare those figures. That also, I think, was not sufficiently recognised at the outset of this controversy. The hon. Member made one very pregnant and significant observation. He asked where had they been able to get rid of a tariff where they had already landed them selves in one? I think that conveys a rather valuable lesson for us. If hon. Members opposite imagine that the people of other countries do not want to get rid of their tariffs in a great many cases they are utterly mistaken. I have travelled to a certain extent, and I have come across, both in our own Colonies and in foreign countries, vast bodies of persons who would be only too glad to see their own countries placed on the same footing as this country. But if you get your head into a noose such as has been hung before us by hon. Gentlemen it is not always so easy to extricate yourself from it again.

The hon. Member said, "What does it matter if the people of this country have to pay more for what they buy, if they have more money to buy it with?" That is the very crux of the whole question; and we on this side of the House absolutely deny that they will have more money to buy these commodities, which will increase in price. That opinion is based on solid and incontrovertible facts. We have only to look at Continental countries to find that, as a matter of fact, under a system of Protection, the workers do not get so much in wages as they do in this country. The figures are published in Blue Books, which were asked for by hon. Gentlemen opposite when they were in office, and I hope they enjoy those statistics now they have got them. They are set down in black and white and conclusively prove that the workers abroad do not enjoy the same wages, whereas they have to work longer hours than the workers in this country. Then, of course, it will be said, "What about the United States?" I have not the slightest fear of appealing to the United States. The hon. Member set out to prove that if we let ourselves in for Protection the price of commodities would rise in a smaller ratio than the amount of wages. What, as a matter of fact, has happened in the United States? Between 1896 and 1907 wages increased 18 per cent. and the cost of living increased by 47.4 per cent. Does that look as if the people of this country would be justified in undertaking a Protectionist tariff in the hope that prices would go up in a smaller ratio than the wages they received? All the figures prove the contrary, and if you take the proportionate increase in Teal wages in the United States, Germany, and this country between 1890 and 1907 you will find that in this country real wages—that is, wages measured by their purchasing power—have increased much more than in Germany or in the United States. In the United States during that period wages rose 2.9 per cent., in Germany 10 per cent., and in this country 17 per cent. What is amiss with that? It is perfectly satisfactory, and I cannot see how a Protective tariff could possibly improve upon that state of affairs.

6.0 P.M.

Then the hon. Member went on to deal with the verdict of the industrial centres, but I think there that you must make a little distinction. If you consider the great productive centres of this country you will find that, with a few exceptions, for certain obvious reasons, they are solid for Free Trade. Why is that? I conceive it to be because the great productive centres and their workers happen to know something about the great trades of this country, and they realise only too plainly that the tariff proposed by hon. Gentlemen opposite would result in the doom of those industries on which their wages and their whole livelihood depend. Therefore, I say, these productive centres, which understand their business very well indeed, are firm for Free Trade, and as long as that is the case it will be impossible to force a tariff down this country's throat. The right hon. Gentleman who opened this Debate said in his opinion, judged on its merits, there might be a majority in this country for Protection. Apart from the question of the comparative industrial value of the vote given I have no doubt myself that, given a fair field, what would happen if you had a verdict on Free Trade versus Protection would be numerically a great victory for Free Trade. I should be only too glad to see that question put to the test, because we on this side of the House have absolutely no reason to fear open debate on this subject. We have no reason to fear that, if you could strip the question of other complicating issues, the country would go wrong on that issue. If you separate the question of Protection from war scares organised by the Yellow Press, if you will disunite it from the beer interest in this country, if you will suspend the malign, iniquitous, territorial influence of landlordism—[Several HON. MEMBERS: "Oh, oh"]—I hope hon. Gentlemen opposite will give token of their sincerity the next time the country comes to decide on this question—if you will give every chance of open and honest debate on this great question, if you will allow each man one voice and one vote, you will see very plainly where Tariff Reform stands in this country to- day. We do not shirk the thorough ventilation of this question. We welcome it, and generally it may be said where there has been ample opportunity of inquiry into what Protection means, England, as a rule, remains staunch to Free Trade. In the boroughs we have done well, and in the rural constituencies, when we have been able to enlighten them a little further and when we have been able to combat the misrepresentations of our opponents on the Budget, Free Trade will regain the ground it may have lost in this election. At present in this land we have not to combat in its full vigour the corruption which is an inevitable accompaniment of a Protective tariff. When there is a scramble for the tariff pie going on, then, perhaps, clear and calm thought is not a matter of great ease; to-day, here, things are easier for the advocates of Free Trade than they are in Protectionist countries, and even against the petty and mercenary appeals made, I am afraid only too often, by Tariff Re- formers, to the personal greed of all persons concerned, it will be comparatively easy for us to show by fact and by argument that Tariff Reform is founded on a delusion, or more than one delusion, that it is fostered by self-interest and furthered by misrepresentations, by contradictions, and by fallacies. I conceive that the policy of Tariff Re- formers is founded on two chief delusions. It is founded on the delusion, firstly, that British trade is in a state of decay; and, secondly, that Protectionist countries are better off than this country in industrial natters. What is the alleged decay of British industry—the decay which is asserted in the Amendment which we are considering to-night? I shall only take absolutely uncontradicted facts, because I wish to be perfectly fair, and I shall take years which will surely be approved by hon. Members on the other side of the House. I take 1902, which the right hon. Member for West Birmingham said was one of the best that British industry had ever known, and I shall compare it with 1907. In 1902 our total exports amounted to £283,000,000. They had increased in 1907 to £378,000,000. Does that look like decay? If you wish to analyse the increase, I would point out that the increase in manufactured articles during that time was no less than 69 per cent. I defy any hon. Gentleman to prove that Protection is necessary in the face of these figures. Tariff Reformers may say that while that is perfectly true, other countries have been going ahead more quickly than ourselves. In fact, the hon. Member who spoke last on the other side of the House said that Germany and other countries were going ahead at a greater ratio than ourselves. That is simply not the fact. I wish to give figures for a period of years with respect to the United Kingdom, France, Germany, and the United States. I shall take the increase during a period of four years in manufactured articles, because I believe that is a point which appeals to hon. Gentlemen opposite. If we examine the figures we find the increase in the export of manufactured articles during the past four years in the United States amounted to 3s. 2d. per head, in France 8s. 10d. per head, in Germany 10s. 4d. per head, and in the United Kingdom £1 4s. 5d. per head. To sum that up, we find that during these four years the gain in the United Kingdom was £1 4s. 5d. per head, as against £1 2s. 4d. per head in the other countries. Does any hon. Gentleman who supports Protection continue to say, in the face of these figures, that our trade is decaying and in need of such a tariff as they advocate?

The second delusion is that Protectionist countries are better off than ourselves. They may have a few more millionaires, but I do most emphatically deny that the masses in this country are not far better off than in the countries I have named. In connection with this question, hon. Gentlemen opposite have made a great deal of the state of unemployment. If you consult the figures as to unemployment as reported in "The Times" you will find that there were not long ago 34 per cent of trade unionists in America out of employment, and if you read the "Daily Mail" you will find that the unemployed were charged by the troops in Berlin. Those who have followed the course of events and seen the figures for the German Labour Bureaux know that in the registries in Germany that there are more than three unskilled men for every job, four leather workers for every job, five wood workers for every job, and more than six machinery makers for every job. Those who have followed these facts and figures must recognise that it is idle to pretend that unemployment is an insignificant factor in foreign countries. I agree with the hon. Member for South Glamorgan (Mr. Brace) that it is iniquitous to exploit this Question of unemployment in connection with the Tariff Reform policy. There will be a day of reckoning. My hon. Friend the Member for Swansea (Mr. Mond) has already given an outline of the general conditions abroad, showing that they are far worse than in this country. Wages are lower, and the cost of everything which the working people have to purchase is greater than in this country. If you turn to the United States of America you will find that in real wages there is no advantage over this country. The United States Labour Department prepared a series of tables a few years ago, in which they gave the results of inquiries made in various countries of the world as to how long it took a man to earn the necessities of life. These necessities included housing, food, clothing, light, heat and taxes. In the United States they are probably not too friendly to Free Trade or a Free Trade country, but it was found that in England you had only to work 205 days to earn these necessities, while in the United States you had to work 225 days. If that does not show that the United States are far from being better off than England, I do not know what figures mean.

In spite of all the fog which surrounds this controversy there is the clear fact that we do the largest trade in the world, and there is no particular reason why we are ahead of other countries except that we are the only Free Trade country in the world. We sell more than twice as much in the shape of manufactured articles to the rest of the world as the rest of the world sells to us. We import only £123,000,000 worth of manufactured articles, and we export £297,000,000 worth of manufactured articles. We export more manufactured articles per head than France and Germany put together, and three or four times as much as the United States. The cost of living is cheaper here than anywhere in the world. These are the salient facts which stand out in this controversy—the cost of living in this country is cheaper than anywhere in the world, and wages certainly are higher than in Continental countries. This Tariff Reform movement is entirely fostered by self-interest. That is the motive power which is behind it. You can learn lessons in this matter from America. The right hon. Gentleman opposite who opened the Debate (Mr. Austen Chamberlain) talked about trusts, and said, "If there are to be trusts, let us have British trusts, instead of foreign trusts, because they would be within our own jurisdiction." I am afraid I cannot agree with that. It is like saying, "There are weeds in my neighbour's garden, let me rather have weeds in my own garden, where I can deal with them." The only way to effectually deal with trusts in the long run is to keep our ports open to every country in the world, so that if a trust is formed in one country we can deal with it by competition. As to the question of jurisdiction, I would say that they are not under jurisdiction. The jurisdictions of the countries where they exist do not control the trusts, but the trusts control the jurisdictions.

When the country really appreciates what this great agitation means, I believe that Protection will be kept off for many year to come. It is based on contradiction, misrepresentation, and fallacy. I want to say a word about food taxes, in regard to which we have heard a great deal. To call us on this side of the House food taxers in the same way that hon. Gentlemen on the other side of the House are food taxers is a misrepresentation. In the first place, we do not want food taxes and they do. That is an important matter to remember. Food taxes which are imposed now are of an entirely different quality to the class of food taxes which hon. Gentlemen opposite wish to impose. Now the food taxes go into the Exchequer, but the food taxes which hon. Gentlemen opposite want to impose would go largely into the pockets of the landowners and manufacturers of this country. We are on the road towards the elimination of food taxes altogether. The facts with relation to food taxes in past years bear out what I am saying. During their last term of office hon. Gentlemen opposite managed to impose extra taxation to the extent of £8,250,000 a year. During the period of office of the Liberal Government £4,750,000 of that taxation was remitted. No Liberal Government has imposed fresh taxes on food for fifty years. Our record is a clean one in this respect. We are working in the direction of the free breakfast table which John Bright had as his ideal. But the revenue for the services of the country must be raised and we must have other taxes as substitutes. That is where the question of last year's Budget comes in. That is where the great schism between ourselves and hon. Gentlemen opposite becomes apparent.

Lastly, I want to say a word about raw materials. We have heard many statements of a contradictory and fallacious character from our political opponents as to raw material. I want a definition of raw material. No one will give it, or, if they do attempt to give it, they give a different one in different places. If they are confronted with any definite article and asked if it is not a raw material they ride off on the argument that they will not tax it as a raw material. What satisfaction is it to a boot manufacturer if he is told that leather is not to be taxed "as such?" If you want an instance of how difficult it is to define raw material, take the case of the cotton industry. The raw material of that industry is not merely raw cotton. It includes also machinery and everything that enters into the manufacture of cotton goods. These things are part and parcel of the preliminary processes in the manufacture of cotton goods. Therefore I say if you tax any of these things you will be taxing the raw materials of the cotton trade, and that trade cannot stand taxation such as you propose. There, again, the same fallacy exists with regard to the "object" of taxation. Hon. Gentlemen opposite always say, "We are not taxing food with the object of raising prices." That is not the point—the point is, Will it raise prices? The question is, what is the effect, and not what is the object? I remember setting out with a friend to be taken across a narrow portion of the sea to a neighbouring island off British Columbia. His object was to reach that island. Unfortunately, he wrecked me on the way. He was not sufficiently skilful to get to the island. It was not his intention, it was his intelligence, that I blamed.

I have tried to show that my conclusions on these matters are not hasty, and are based on facts. I heartily agree with the hon. Member for Sunderland (Mr. Storey) that the problem which is being discussed is no merely party problem. I could wish for nothing better myself than that everybody should go away to think it over impartially, for I fear that hon. Mem- bers opposite, perhaps, are not given to thinking over the facts and details quite so much as if they had studied the conditions abroad, and had studied the effects in this country. I could wish it to be referred even, as Lord Rosebery suggested, to some Commission of impartial men—if you could find impartial men on the subject today—and I should be perfectly content to be guided by that. Unfortunately, the Question has come into the vortex of party politics, and nothing can prevent it coming into that vortex. We have got to fight it out, and the fight now is a fight between the interests of the masses of the people on the one hand, and the interests of a plutocracy and a minority on the other. I have come to this conclusion not from a party spirit and not hastily, but by studying facts and figures, and from my personal experience abroad; and until my faculties fail or the laws of logic alter I hope to support the cause of Free Trade, while to-day I shall have pleasure in doing what little I can to contribute to another victory in the long list which will be credited to Free Trade as against the policy that is miscalled "Tariff Reform."

Mr. BALFOUR

The Debate which is to conclude to-night has been richer than any Debate which I remember in its display of talent on the part of new Members on both sides of the House. I have listened, I will not say to all, but to almost all, the speeches which they have delivered, and I must say that I think every old Member of the House, whatever his views and whatever the views of these new Members are, will admit that a better series of maiden speeches probably never has been delivered in this House of Commons. The hon. Gentleman who has just sat down (Mr. Crawshay-Williams) has certainly on his part shown plenty of ability and great readiness to deal with the important problems before us. Here and there I thought I detected in portions of his speech some slight reminiscence of the platform; but as we have all just come from much exercise of that kind I should be the last to criticise him on that account. And perhaps the only criticism I think I should make on it is that, while I entirely accept his view that he has approached this great and complicated Question in no spirit of party, and with no desire to find fault with the party which he criticises, and that his views are based on a careful study of the facts and figures relating to the whole problem in this country and in foreign countries, yet he has not any monopoly of impartiality, and we, at all events, may be taken as expressing our own opinions quite as impartially.

I suppose that I ought, in the short speech which I am now making, to refer briefly to some of the other speeches which preceded that of the hon. Gentleman. There is one speech which can hardly be said to have dealt with the substance of the Debate, but which is yet worthy of the consideration of both sides of the House. I mean the epigrammatic utterances of the hon. Gentleman the Member for East Tyrone (Mr. Kettle). He expressed, as I understand it, the official view of, at all events, the largest section of the Nationalist party in this House, and perhaps of the whole Nationalist party. But the practical substance of the speech really might be compressed into one or two sentences. He said that we who represent the British constituencies were either Free Traders or Protectionists; that if Protectionists we got our Protection from Birmingham, and that if Free Traders we got our Free Trade from Manchester; that he would have nothing to do either with Protection of British origin or with Free Trade of British origin; that the only brand of those policies in which he would take an interest was one of purely Irish manufactures, and that it was a fiscal policy dictated from Dublin, and from Dublin alone, which interested the Irish people or that section of the Irish people which he represents. I do not think that those who were present during the speech will accuse me of having misrepresented the hon. Gentleman. That is a most important statement from the point of view of everybody who is considering those large constitutional questions which are present to all our minds even when we are discussing so vital a problem as the problem of unemployment. It is a declaration on the part of the Irish party that their claim is a claim not merely to settle their domestic affairs in the sense of the purely internal affairs of the country, but to settle their domestic affaire, including taxation, a claim distinctly repudiated by the Prime Minister, a policy which he said was going to form no part of any Home Rule policy with which he is going to be identified. I am bound to say, as far as I can see, that it is perfectly logical in its character. The claim to settle its own affairs, to which the hon. Gentleman the Member for East Tyrone thinks Ireland has a right, surely can only be logically accepted if it includes a settlement of where they would have im- port duty in Ireland and what that import duty shall be, on what goods it shall be imposed, and coming from what countries those goods shall be selected. I beg hon. Gentlemen to consider precisely what the Home Rule claim means on this claim. It has been stated in your hearing within the last twenty-four hours in the most definite and the most unmistakable form, and the Irish party have announced that they will be content with nothing but this autonomy in matters of taxation. And so clear are their claims and so unmistakable their wishes that they take no interest in the debates going on between the two sides of the House as to the fiscal system applied to the rest of the country. The moral is one which should be considered by gentlemen who give very little attention to the complex problems inevitably raised by the proposals for Irish self-government.

I quite admit that though those observations are distinctly irrelevant to the speech delivered by the hon. Gentleman (Mr. Kettle), they are not the main matter which at the present moment is being discussed in connection with this Debate. I will therefore deal briefly with some of the points that have been raised by previous speakers. The right hon. Gentleman the President of the Board of Trade in his speech challenged me, as I understood him, to explain my views as to the incidence of import duty, and as to what I can have meant by saying I hoped that one result of any taxation which might be placed upon wheat would be to affect favourably the price of that commodity. I am ready to take up that challenge. I think that very rash statements have been made, perhaps on both sides of the House and perhaps by all parties in the controversy, with regard to this difficult question of the incidence of import duties. But I do not remember any gentleman who agrees with me in his fiscal views stating that the duties were always paid by foreigners. I have heard that statement attributed to Tariff Reformers by hon. Members on the other side of the House, but I never heard of a Tariff Reformer who said that all import duties were paid by the exporting country. At any rate, that is not my view. Equally crude and quite as rash is a statement which undoubtedly has been made by almost every gentleman sitting on the other side of the House, by the Prime Minister, by the right hon. Gentleman the President of the Board of Trade, and by, I think, almost every gentleman who has taken part on their side in the controversy, and that is that the consumer always pays at least the duty and probably more. Neither of these statements is true; and both are bad political economy. The President of the Board of Trade will forgive me for saying that he is a very old sinner on this subject. He wrote a book many years ago called "The A B C of Free Trade."

Mr. SYDNEY BUXTON

It was not written by me.

Mr. BALFOUR

I beg pardon; I thought it was the right hon. Gentleman. We should all be sorry to bear the sins of our relations, so I will not refer further to the earlier efforts of the right hon. Gentleman.

Mr. BUXTON

I am not the sinner.

Mr. BALFOUR

I rather think that, though he may not have put it in print, he has made speeches which did imply—I think the speech yesterday implied—that in his view the mere fact that a duty was put on corn raised the price by the amount of that duty. Really that is a statement which ought not to be made by any instructed economist. I do not believe that any instructed economist holds to it. I am not going into the technicalities of it, nor do I wish to press the weight of authority upon any Gentleman in this House. I agree with my hon. Friend the Member for Brighton, who made an excellent speech, that we must all think out these things for ourselves, but I do say that the weight of economic authority is not in favour of that proposition. There are many cases in which, without the smallest question, the foreigner does contribute part of the tax, perhaps even the whole tax, levied by an importing country upon his exports. The right hon. Gentleman asked me why I thought that the Tariff Reform method of dealing with the import of wheat would have any effect either in lowering the price of wheat or preventing it rising. The reason is very simple. Our prophecies may be wrong, but they are based upon a perfectly sound form of calculation. The reason why the price of wheat rises in an old country where the population is growing and where there are no imports is, as everybody knows—it is a common-place theory—because you are driven to worse and worse land for raising it, and it costs more and more to raise the last margin of wheat which is raised. It is known to everybody as the law of diminishing returns, but there is a law of increasing returns which may, and I think does, in this particular case, apply to food for many many years to come, as it may apply to any other form of manufacture; and if the result of preference given to our Colonies is to hasten the time when areas better suited to corn cultivation than is now being used are brought under the plough, and if it results in an increase of railway accommodation in Canada or other regions, it may well be the result of preference that you will, if not diminish the price of corn, prevent a rise in the price of corn which the growing demand of the world might otherwise bring about. The right hon. Gentleman may doubt whether that speculation—I admit it is only a speculation—all prophecies on economic matters are speculations—he may doubt whether that prophecy will be fulfilled, and it is a thing which cannot be alleged with certainty. I think it is reasonably probable, and to dismiss it, as the right hon. Gentleman appears ready to do, as a mere fantastic speculation unworthy of serious consideration—

Mr. BUXTON

No, no.

Mr. BALFOUR

I thought the right hon. Gentleman did regard it with something verging on intellectual contempt, but if he does not let us agree that this is a thing we cannot prove. I am, for my part, ready to say that possibly my expectations will be disappointed, and he on his part will say that they may perhaps turn out to be true. I do not know that a nearer agreement can be expected. The right hon. Gentleman appears to think—this is a very important point not in the theory of Tariff Reform, but in the conduct of the Tariff Reform controversy—that this speculation of mine as regards the future of wheat production has some reference to a statement I made that Tariff Reform, as I conceive it, should not be allowed to increase the share which the working classes, the wage-earning classes, of this country contribute to the National Exchequer. The two statements have no connection one with the other. They are wholly different considerations. A diminution in the price of wheat or the prevention of any growth in the cost of wheat is, I admit, an economic speculation depending upon facts which I cannot fully foresee. The other is a question depending on the adjustment of taxation, and that is in the power of this House and any Chancellor of the Exchequer who has the confidence of the House to deal with as he pleases. It is common ground between the Front Government Bench and ourselves that the working classes, like other classes of this country, must pay their quota to the National Exchequer and contribute their share towards meeting the national expenditure. All we say is that the contribution they give is not to be increased by the mere fact that you substitute a Tariff Reform system for the existing system. That is a matter which can be arranged by the Chancellor of the Exchequer of the time. You have so to deal with your taxes that the share of the working classes, the share of the wage-earning classes, in the payment of those taxes shall not be augmented by the adoption of a system of this particular character. That is a statement which can be made in the confident belief that it can be carried out. I quite agree, when you are in the region of economic speculations, that you may be deceived, and facts may not bear you out as you expect; but when you are dealing with the adjustment of taxation as between different classes of the community, that can be dealt with by the Chancellor of the Exchequer of the time.

I hope that the statement that I have given to the House to-night may get rid of a good many misconceptions as to the nature of the pledge I have given on the subject, and which I think was sometimes misunderstood even by my own Friends, or, perhaps, if not misunderstood, not quite accurately stated. It is not, of course, always easy in the heat of debate, in the rush of platform controversy, to observe perfect accuracy of statement in dealing with a difficult subject. I sometimes see my opinions quoted as if I had promised there should be no rise in the price of food. How could I or anyone else promise that? There may be a rise in the price of food for a thousand and one reasons which no man could foresee, and which no man could deal with. My promise was given with regard to the field in which we have the power, or shall have the power, to see that our promises are carried out. I, therefore, gave the pledge with perfect serenity, and I have not the least doubt that, if circumstances should turn out as we expect, we should have an opportunity of proving that that promise can be kept. Now I turn from the right hon. Gentleman to what has really occupied the attention of the House more than any other aspects of this question during the Debate—I mean, of course, the question of unemployment. It is impossible, in the course of a speech, to survey all the aspects of the fiscal question, because, as the House knows, the Colonial aspect of it alone is one which may well occupy the attention of the House for many hours. That is a part of the problem in which I take at least as great an interest as I do in any other part of it. It is not that part of the problem on which I wish especially to ask the attention of the House this afternoon. The part of the problem on which I wish to ask your attention is the question of unemployment. Here, again, I think it is possible that rash statements have been made on both sides of the House. I do not think, so far as my memory goes, that any of those rash statements can be attributed to me. I do not think so. I remember being challenged by a Member belonging to the Labour party on the very last day of the late Parliament, whether I was one of those who thought that the whole problem of unemployment could be cured by Tariff Reform. I took immediate occasion to follow him, and I said I did not hold that view, that I never had held that view, and that my Friends on this bench had never held that view. We perfectly recognised how complex that problem was. While it was absurd to say that you could deal, for instance, with unemployment by Tariff Reform, or that you could carry out the objects which many Members of the Commission on the Poor Law hope to see effected by a reform of the Poor Law—while it is absurd to say that these objects could be carried out by Tariff Reform, there are other aspects of unemployment which in our judgment undoubtedly could be mitigated by introducing a fiscal system which we venture to recommend to the House. I think everybody will bear me out when I say that I have consistently held that language. It is not language of the exaggerated type which has been attributed to us by some speakers whom I have heard in the course of this Debate.

Let us consider, before I come to the actual remedy, the actual effect of Tariff Reform in dealing with unemployment, what is the alternative remedy. The only alternative remedy I have heard suggested was afforestation. The hon. Gentleman the Member for Leicester, colleague of the hon. Gentleman who has just sat down, said that afforestation would do more in ten years for the relief of unemployment than Tariff Reform would do in fifty years. I have great respect for the speeches of the hon. Gentleman, but it does seem to me that he sometimes lapses into statements, which, if he took those hours for reflection recommended to all of us by the speaker who has just sat down, he would have avoided. He knows the Highlands, I have no doubt, as well, if not better, than I do, but I say afforestation there would fail in two things, one is that while afforestation I think would be tolerable in parts of the Highlands, the only part of the Highlands in which it would be tolerable are certain regions where, without being driven to plant your trees above 800 or 1,000 feet, you could get your means of communication between your forests and the markets which your forests are to supply. That is a strictly limited area. The idea that you are going to cover these mountain tracts with woods that are to pay, and that by so doing you are going to give the Nation a great asset and relieve unemployment, is, I assure him, a dream, and, if it could be carried out, does he really think it is going to benefit the crowded centres of industry either in the South of Scotland or England? Are they going to migrate? As you cannot make the Highland forests migrate to England, you have got to make Englishmen migrate to the forests you are planting in the Highlands. He will not get them to migrate to the forest. You will do nothing, you can do nothing, to deal with the problem of unemployment in Great Britain and Ireland by planting the waste places, the mountainous spaces of those two islands. If that is the best solution Labour or Socialism has to offer, then I do not think the Labour Socialist party, of which the hon. Member is so distinguished an ornament, have anything substantial to offer to the unemployed of this country.

I turn to the Radical devices for dealing with labour problems, and there are three of them, which I will enumerate but not discuss. There is the Sweating Act, there is the Labour Exchanges Act, and there is the Insurance Bill, or, rather, scheme. I say that none of those methods are tolerable unless you are going to have Tariff Reform. Your Sweating Act says that certain commodities are not to be produced in this country unless a certain rate of wages is paid to the workers. That is the essence of it. How is that to be a tolerable scheme unless you forbid those particular commodities coming in when they are produced elsewhere under wholly different industrial conditions.

Mr. J. M. ROBERTSON

Produced under Protection elsewhere.

An HON. MEMBER

What has that got to do with if?

Mr. BALFOUR

I take the second proposal—the Labour Exchanges. My right hon. Friend has already expressed his approval of the Labour Exchanges; but if there is no work to give people who want work your Labour Exchange does no more than expose the magnitude of the evil with which you are dealing, without any remedy for it. You cannot give them work when they ask for work, and what is the use of having an Exchange to tell them so at great cost to the community, and with no benefit to themselves. The third plan is that of insurance for out of work. There was a very pregnant and important observation made on that point by my hon. Friend the Member for Glasgow (Mr. Mackinder), who made an admirable speech, as I thought, in the course of yesterday's Debate. If you are going to insure every man against unemployment, no man will leave these shores for employment elsewhere, or, at all events, very few. That means you will throw on the general community the burden of supporting those who now emigrate. That might be, and would be, tolerable if it took the form of finding employment for those men of a kind to which they were suited, remunerative to them and to their employers; but that is not what your insurance against unemployment is going to do, unless you accompany it by some method of increasing the general employment of the community. No doubt, it might be a benefit to the individuals immediately concerned, but it is a growing, and necessarily involves a growing burden on the community as a whole. Therefore all these methods, and I do not wish to attack them, which are the special boast of hon. and right hon. Gentlemen opposite, really and only do what you would expect of them if you associate them with the scheme of Tariff Reform. Unless additional capital, under the control of private enterprise, can be provided in this country none of those palliatives can be more than palliatives, and some of them in the end will aggravate the very disease with which you are dealing.

Of course, when we say they can produce no effects if you are going to have them without Tarift Reform, I am assuming the point in dispute between us. That I quite admit, and that is the point in dispute so far as our internal affairs are concerned. I put the question this way if the House will allow me, if Tariff Reform, and only if Tariff Reform, increases the productive efficiency of the country, the productive powers of the country, increases this production, only then is it a policy in which I take the smallest interest so far as internal affairs are concerned. It is because I believe most firmly that Tariff Reform will increase the productive powers of the country that I venture to press it on the House, and have ventured to press it on the country. That is the real point of difference between us. The Prime Minister for instance has on many platforms, and I think in this House, put various figures of exports and imports based on the idea that exports and imports are to remain exactly of the same volume after Tariff Reform, or at all events not to increase after Tariff Reform, whereas our whole point is that it will increase production. That is the whole contention. I do not believe that hon. Gentlemen opposite, now that I have stated the difference between us, will think I have done otherwise than state it fairly. It will be observed that really this question of the effect upon the prosperity of this class, or of that class, of a small duty upon wheat, important as I admit it to be for electioneering, that really, and I think they will all agree with me here, they fall into insignificance compared with the great fundamental problem, is employment and productive capacity, and the exercise of productive capacity, are they going to be increased or not going to be increased by Tariff Reform. If they are not by Tariff Reform, why, then, a shilling duty or a small duty might be nothing but an unmixed evil. I do not dogmatise about it, but if Tariff Reform is really going to do what we say for it, such small criticisms as were passed upon it to-day by the hon. Member for Swansea (Mr. Alfred Mond), I do not say unimportant criticisms, but are relatively utterly unimportant criticisms as compared with that other issue which I have laid before the House.

I think hon. Gentlemen will agree with me that is the fundamental point. If we are right, and if productivity is increased by Tariff Reform, all the rest may be ignored. If we are wrong, then the thing is not worth arguing or fighting any further, and I for one, so far as the prosperity of the country is concerned, take no further interest in it. How does that matter stand? Let us first broadly take the experience that is always discussed, and rightly discussed, in this House and the country, the experience of those great rival countries which have tariffs, the experience of Germany and the experience of the United States, and I think I might; add the experience of Canada. We have the most amazingly contradictory statements with regard to the actual conditions of the working classes in those various countries. The culmination of eccentricity of statement was reached by the hon. Gentleman who proceeded me, who, I think, told us that the wages in the United States were lower than in this country.

Mr. J. M. ROBERTSON

That the real wages in the United States were equal to those in this country.

7.0 P.M.

Mr. BALFOUR

He read us out some figures which indicated that in the opinion of the authority be quoted they were lower. I confess I never heard any statement so astonishing. At the same time there is controversy about the German working man. I do not know that I am qualified to hold a judicial position between all those sources of information. Shortly I may lay down two propositions, without the least doubt or hesitation. The one is that the working classes in no country which has adopted tariffs desire to give them up. The hon. Member for Leicester (Mr. Ramsay Macdonald) said something yesterday which at first sight seemed to contradict that, but I think, if I may venture respectfully to say so to him, if he will inquire he will find that, though no doubt many of the workers in the towns of Germany would like to see the duties upon wheat and meat and other foodstuffs diminished, the working classes in Germany, taken as a whole, undoubtedly desire to see the system of tariffs maintained. That is what I believe to be from the best of our information the attitude of Germany on this Question, and of the United States, and beyond all question of Canada. It is true beyond all question of every civilised State in the world except our own. If that be true there is really no use in following the example of the hon. Member for Swansea (Mr. Mond) and describing everybody but ourselves as stupid and almost idiotic. I do not think that is a very respectful way of treating the civilised world. However well we may think of ourselves, we are not the only people with wisdom. I would remind the hon. Member for Swansea that the manufacturing and shipping superiority of this country was not, as his researches appear to have persuaded him, exclusively built up in the time of Free Trade. It was built up in a time when tariffs were universally believed in. We were the first ship owners. [Several HON. MEMBERS: "Oh!"] Does anybody deny my statement? We were more clearly ahead of the world long before Free Trade was introduced. I said that our superiority was built up in days when neither we nor anybody else were Free Traders. That superiority is not the offspring, as the hon. Member appears to suppose, of the abolition of the Corn Laws, or of the abolition of any duties in 1841 or 1846. It is not then that our superiority began; it is since then that our superiority has been threatened.

But there is far more important argument upon this point than any of those I have as yet brought before the House. It was referred to last night in the speech of my hon. Friend the Member for the Camlachie Division of Glasgow (Mr. Mackinder), and it is strictly relevant to this Question of employment. It is a question drawn from immigration and emigration statistics. After all, when you talk of the conditions of the German working man, the English working man, and the American working man, you must remember the difference between these three countries in this important respect. Before tariffs were adopted in Germany, the emigration from Germany to all the new countries of the world was immense. Since then, the growth of German manufactures, in other words, the growth of the German demand for labour has practically equalled the increase of the German demand for employment—and that in a country which has a birth rate far exceeding our own. The case of the United States is different from the case of Germany, as both are different from the case of the United Kingdom. The position of the United States with regard to immigration is that they annually absorb a number of immigrants equal, I believe, to the total birthrate of that immense community. They absorb and find employment for the great mass of them. They deal with a problem of employment such as we do not even dream of in this country. They deal with a difficulty which we have never experienced and of which we have no notion. They take in, week after week, from their ports on the east coast this vast and perpetual stream of immigration, and these people are with marvellously little difficulty and suffering absorbed into that great industrial community, without apparently either materially lowering the rate of wages or upsetting any other important element in the labour market. Our case is that, with no perceptible immigration, or immigration on any large scale like that with which America has to deal, and with a birthrate far lower than that of Germany, we yet find ourselves hard put to it to deal with the efficient part of our population seeking work and not finding it, and we deal with it far less effectively than the United States with their immigration and Germany with their high birth-rate.

I do not see how that particular argument is to be got over. The facts are beyond question. You may argue for ever as to whether the Germans eat horseflesh and whether the American working man pays more, and how much more, for the things he needs than the English working man. In the atmosphere in which, unfortunately, we have to carry on these discussions we have endless contradictory statements on these points, with no impartial tribunal to decide between them. As my right hon. Friend (Mr. Austen Chamberlain) truly observes, the American working man does not appreciate the inferiority in real wages in America in the way you would expect him to do. There is no emigration from America to enjoy that higher level of real wages of which the last speaker so eloquently reminded us. The importance of looking at this matter from the point of view of the power of absorbing these people and finding employment cannot be put to a better test than that to which I have subjected it. It is directly relevant to this Question of employment. How can you say with confidence, basing your views on experience, that our fiscal system is better than that of other countries similar in civilisation, in reality not at all dissimilar in their industrial products, and not dissimilar in the character of their population or their origin? How can you say that your fiscal system is the best from the point of view of employment when you find that our two friendly rivals can with ease absorb a far larger surplus population than we can deal with at all? There are always flaws in these appeals to experience in economic matters. The complex causes by which the economic destiny of a nation is affected are so varied that it is very easy to say, "Look at this phenomenon, and look at that," but they may not be cause and effect. I think, for instance, that the great change in England in the '60's was as much due, or more, to the gold discoveries and the railway discoveries as to any change in our fiscal system. Other gentlemen may take a different view. You cannot prove it one way or the other. Here you have a broad fact directly touching employment, and I think those who choose to base their objections to fiscal reform on experience are bound to explain how America and Germany can deal with the unemployed question so much more effectively than we can. And please note that this argument goes fax beyond the sort of criticism made by the hon. Member for Leicester (Mr. Ramsay Macdonald) yesterday. He said, "I have been to Germany, and I have seen at the Labour Exchanges there people struggling to find employment, just as you find them struggling here in England." I have been dealing with the problem of unemployment, and I say that Germany and America are far in advance of Great Britain. But my argument goes beyond that, because America, Germany, and Great Britain are not on an equality in this matter. We have an easier problem to deal with than they have, because Germany has a more rapidly increasing population and America has the immigration problem to deal with. But although our problem is easier, we deal with it far less effectually. From the point of view of experience, that argument holds the field, it has never been answered, and, as far as my knowledge goes, it cannot be answered.

1, of course, admit, with the hon. Member for Leicester, that you can never get rid of that problem of unemployment which arises from the oscillations of trade. I believe the hon. Member looks forward to a system under which there will be no oscillations of trade. He says, quite truly I think, that the oscillations of trade are due to the unduly sanguine expectations of traders at certain periods, and their equally unjustifiable terrors at other periods. I do not know about the terrors, but I am sure that under the system which he hopes some day to introduce there would be no undue elation as far as any traders were concerned. That particular cause of difficulty would no doubt be eliminated. Meanwhile, in the imperfect economic system under which for the moment we are forced to live, I admit that there are oscillations, and that those oscillations carry with them want of employment during periods of depression. But I venture to suggest to the House that those periods of depression are much more likely to be deep and prolonged in a country where dumping from every side is possible than in countries which have protected themselves against dumping, while they look forword with confidence, a confidence perhaps recently diminished, to having our markets for ever open to them for carrying on their methods of getting rid of their surplus products. It must be to the disadvantage of the British producer that in good times he has not got manufactures equal to all the demands that may be made upon him, while in bad times he finds himself flooded by the goods of his rivals elsewhere. That is a condition which cannot be good for trade. It cannot give that feeling of security which, after all, under our present system is the very basis of all enterprise and the very foundation of all prosperity. From that point of view also, though I agree that nothing we can do will wholly do away with these variations in the fortunes of the working classes, I think those variations are greatly aggravated by our existing system, especially when we remember that we remain in our solitary wisdom the only Free Trade country from whose policy every other country in moments of depression can extract what benefit it likes. I have detained the House much longer than I intended, and I will submit to it no more observations. As the House knows, there are other aspects of this fiscal question on which I feel most deeply, but I thought, on the question of the relation between fiscal reform and unemployment, while it does not cover half the Resolution of my right hon. Friend, is, at all events under the existing circumstances, so important, so critical, that the House would tolerate, as it has tolerated, me in giving fuller expression to my views than I have been able to give before.

The hon. Gentleman who has just sat down told us that all the great centres of population of this country were opposed to Tariff Reform, and that it was only in the squire-ridden counties that the cause was making progress. The hon. Gentleman is mistaken. I believe, if he will go through all the towns of this country of above 25,000 electorate, he will find at this moment that those towns are represented by a majority of Unionist Members, and that they have a vast majority of Unionist votes. Unfortunately, we have not got a majority of votes from other sources. But let no man flatter himself that the cause of Tariff Reform is not making progress in the large centres of population. I agree that doctrines which it is easy for opponents to pervert may easily excite, and do excite, prejudice; yet I am well assured, as the time goes on, and as there enters into the minds of the electors the full consciousness of the broad economic issues which I have ventured to lay before the House, it will become more and more certain that the example which has been set us by our own Colonies and by every other civilised country in the world will in no long time be followed by us.

The PRESIDENT of the BOARD of EDUCATION (Mr. Runciman)

It is not the first time the House has listened to the right hon. Gentleman addressing, not so much this House as his own party on the subject of Tariff Reform. I doubt whether in any of the many speeches he has made on the subject he has ever bolstered up this argument by Protectionist examples, and made an appeal to the Protectionist instincts of the people of this country than to-night. I cannot forget the time when the right hon. Gentleman asserted in public that he would not be, and could not be, the Leader of a Protectionist party. I hope he still adheres to that edict, and that even now he may save his party from becoming pledged to the principles of Protection as avowed even by himself not only here, but on many Protectionist platforms in the country during the last few months. He has based his cause to-night very largely on the numbers of the working classes who are employed in the United Kingdom, the number of those who are out of work, and the hardships which are said to have accrued from our Free Trade system. His main argument, if I understand him aright, was that there were being driven out of the United Kingdom every year large numbers of men to find employment in protected countries abroad, and this emigration of our working classes is not paralleled in Germany. From that he infers that the working classes in Germany find Protection more attractive there than our working classes find Free Trade here. No one can disguise the fact that the number of emigrants from Germany to the United States is very much smaller than from the United Kingdom. Yet there are more citizens of the United States of German birth than there are citizens of the United States of English and Welsh birth.

Mr. BALFOUR

That is exactly our point.

Mr. RUNCIMAN

I am informed that there are three times more Germans in America, attracted to America, I presume, by the superior qualities of America, by its superior fiscal system, and by the larger outlets for their labour than there are English and Welsh attracted to the States of America.

Mr. BONAR LAW

When did they go?

Mr. RUNCIMAN

I am taking those who have been actually born in Germany and those born in England and Wales. [An HON. MEMBER: "And Ireland."] I know that during the last few years there has been a smaller number of Germans going from Germany to the United States than Englishmen going from England to the United States. That is quite true. But the right hon. Gentleman has quite left out of account two very important facts. The one is the whole effort of the German Government to prevent emigration from their country. Then he has forgotten the military service which makes it necessary for Germany to retain in Germany during these very years those citizens who will be able to serve in their army. Then, again, he takes the figures which only show the emigration from German ports. A large number of Germans pass every year across the land frontiers never to return to Germany again. If he wants a comparison between England and Germany, let me tell him that there are far more Germans at present in England than there are English in Germany. The right hon. Gentleman said that in the days when all the world was Protectionist we had an undoubted supremacy in the manufacturing industries, and, strangely enough, in the shipping industry. He declares that ever since then our supremacy has gradually faded away. He referred to the subject of shipping. I am not altogether unacquainted with the shipping industry, and when he uses that as a protectionist example I think he must have forgotten both the nature and the history of British shipping. Our supremacy at the present moment in the world as regards merchant shipping is greater than ever it was at any previous time. The hon. Gentleman (Mr. Bonar Law) thinks that is not true. Let him get up and prove it. I go further, and say that during the period while we were still Free Trade, and while America was less Protectionist than at present, she not only challenged, but very nearly equalled us. I know the hon. Gentleman will reply that it was the Civil War which brought about the diminution in the American mercantile service. It is perfectly true that the Civil War did destroy the mercantile marine, but he ought not to have overlooked the fact that not only was their mercantile navy as great, but I am assured, that at that time the quality of the merchant shipping was greater than ours. That was about the years 1858–9. Forty years have passed since then. The American war, it is true, destroyed the American Marine, and it was the time of the Civil War that made it necessary for their Chancellor to embark upon a Protectionist Budget that has made it impossible for their mercantile marine ever to revive. The result is that whereas in 1860 they had a mercantile navy of 4,500,000 tons, now their ocean-going merchant navy is down to 900,000 tons—about as much as you find registered in a respectable British port. Our shipping supremacy ought not to be ignored by the right hon. Gentleman, for it is a good example of the direct benefits of Free Trade.

I know it is often passed over and ignored. The right hon. Gentleman's well-known pamphlet, "Insular Free Trade," discusses the trade of the United Kingdom. He discusses everything under the sun. Shipping he dismisses with a footnote on one of his pages, and never mentions the subject again. I recommend the right hon. Gentleman, if I may respectfully do so, to study the latest returns of Lloyd's Register. They show that this Free Trade country, said to be handicapped in competition with the world because of our Free Trade system, has not only the greatest merchant navy, but the best equipped, the best paid sailors, and the fastest ships in the world. I go further, and say that it has the most prosperous shipbuilders in the world. My hon. Friend the senior Member for Sunderland to-day in a speech reminiscent of those that this House has listened to before made some reference to unemployment in Sunderland. He knows perfectly well that unemployment in Sunderland is due to depression in the shipbuilding industry. Very large numbers of the men walking about were four years ago employed in the shipyards and engine works. That is perfectly true. But they are not out of work either because of Protection abroad or of Free Trade at home. As everyone knows, there is no trade that fluctuates so much as the shipbuilding industry. Yet, bad as the depression was last year, we were infinitely better off than any other foreign country. We produced a larger amount of tonnage last year than we produced in the year before. Germany our greatest competitor, produced far less. Her output was very nearly half. Ours went up by nearly 100,000 tons. Not only was our shipbuilding able to hold its own in a time of great depression, but it depended for its industry on our Free Trade system. We were able to buy for our ship- building industry the raw materials that we required in the cheapest market in the world, without any obstacle being erected by the Custom House officer or Chancellor of the Exchequer. Steel plates came from Germany, and they were welcomed on the Wear. Had they not been I doubt very much whether the Wear shipbuilders would have got the orders which gave the employment to their men. Not only is our shipbuilding industry able to hold its own in competition with protected shipbuilding countries, but our shipbuilding industry depends absolutely on Free Trade. I go so far as to say that if we depart from our Free Trade system in this country it will be impossible to devise any means by which to give to our shipbuilders the same abundant and cheap raw material that they consume at the present time. Germany is so handicapped by tariffs that when the time of competition is hottest; when tramp shipping—which, after all, is the largest amount of shipping in the world—shipping depending on the cheapest possible raw material that can be provided and the cheapest possible ships that can be built—that in these times Germany with all her skill has been unable to devise a fiscal system which can give her shipbuilders a chance of competing with us. The right hon. Gentleman suggested that he was anxious that there should be more trade. Tariff Reform, he said, was to encourage more trade in this country. I presume that he means by more trade, not only more exports, but more imports. It is a curious way of bringing more trade in imports by putting a tax on them and by raising obstacles to the import trade. Our experience is not likely to be different to other Protectionist countries. Our imports may be diverted; we may bring about a complete change in their nature. You certainly cannot increase their amount. If I understood his argument aright, he depended very largely on the doctrine put forward by the Member for East Worcestershire—on the skill of a Tariff Reform Chancellor to divert trade into more remunerative channels.

The right hon. Gentleman's idea was that you might by some means prevent manufactured goods coming into this country and make our main exports manufactured goods which we made here. We should have more raw material and less manufactured goods coming in, and we should send out more manufactured goods and less raw material. But, curiously enough, that is exactly the opposite of the experience of Germany. It has failed signally in Germany. I am aware that the Germans have not less actual wealth than we have—their deposits of iron, and I am told of coal, are larger, yet as a matter of fact Germany succeeds in exporting 70 per cent. of manufactured goods of her total exports and 30 per cent. raw material. She imports 21 per cent. of her total trade in manufactured goods, and very nearly 80 per cent. is raw material. Ours is better than that, for of our exports we do not export 70 per cent. like Germany; we export 80 per cent. of manufactured goods; and, curiously enough, in imports we bring in not less than Germany, in spite of her tariffs. Then the right hon. Gentleman gave an example from the sweated industries, in order to prove that our legislation would be no use to those employed in the sweated industries unless it was backed up by a system of Tariff Reform. The right hon. Gentleman overlooks the fact that there are four trades in the Schedule of sweated industries, and in three of these there is no foreign competition. First, there is the chain trade; with that there is no foreign competition. The second is the tailoring trade, where, again, there is no foreign competition. [An HON MEMBER: "Oh."] There is no foreign competition in the tailoring, or practically none. Can the hon. Gentleman point to a single Member of this House who would think of wearing a German suit? Can he tell me of any one section of the working classes in any of our great towns that buy clothes made abroad? The tailoring industry is almost peculiarly an English industry. But in the sweated tailoring industry what is sweated is not machine- made clothes, but clothes upon which hand labour, and only hand labour, has been expended. Take the next—that of paper boxes. There is no foreign competition in paper boxes, and no one need be surprised at that; and to say that these trades cannot be helped without Tariff Reform is absurd. The only other is the lace-making, the most flourishing, and there I admit there is foreign competition, but I doubt whether the right hon. Gentleman's tariff would bring any benefit to those engaged in that industry. The next point he made was that in this country unemployment was growing. [Mr. BALFOUR dissented.] I do not wish to misrepresent the right hon. Gentleman, but I understood that his impression was that unemployment was getting worse.

Mr. BALFOUR

I do not think I did draw that inference. I have not the statistics, but I am afraid it is not improving.

Mr. RUNCIMAN

Well, it is at a standstill, then. If it is not improving it is at a standstill, but it is not a fact. Unemployment fluctuates almost as greatly as the changes in the shipbuilding industry. The tendency has been gradually downward and not upward. It is lower in the United Kingdom than ever it was before.

Mr. BONAR LAW

Give us the figures as to that.

Mr. RUNCIMAN

I am not going into details. [HON. MEMBERS: "Oh."] I am quite prepared to give them if hon. Members wish, but perhaps I may be allowed to finish my argument first, and I want to point out that bad as trade is at the present time, that in the industries where foreign competition is supposed to be the hottest, unemployment is not the worst.

Take a trade well known to Yorkshire Members of this House—the woollen industry. It has to put up with very hot foreign competition. There is no trade that has to fight so hard for its existence, yet at the present time in Bradford, bad as trade is, it is almost impossible for employers to get weavers, and in towns like Dewsbury and Batley, where they make a lower kind of cloth than Bradford—I say lower but not worse—their mills are working night and day. When an attempt was made to set up a Distress Committee in Dewsbury not very long ago, it was discovered that there were no distressed to be registered, and that is the state of things in an industry that has to put up with foreign competition. I am sure the right hon. Gentleman therefore will admit that foreign competition is not closely allied to unemployment in that trade. Taking the trade as a whole he will find that where the imports into this country are largest unemployment is least, and when the imports are smallest, that is when British goods are being displaced by foreign goods, then unemployment is worst. If that proves anything it certainly does not prove that by keeping out imports you are going to reduce unemployment.

The right hon. Gentleman referred at some length to his own statement about a tax on corn. I quite understand one ought not to be pinned down too closely to every statement made during the heat of the General Election, but some of the statements of the right hon. Gentleman were not made in the heat of the election. The manifesto signed by himself and the right hon. Gentleman the Member for West Birmingham (Mr. Chamberlain) was quite definite, and stated:— Tariff Reform will not increase the cost of living of the working classes, nor the proportion of taxation paid by them. But it will enable us to reduce the present taxes upon the working classes' consumption. That was a definite statement, and no attempt was made to qualify it. When the right hon. Gentleman spoke at York, he was more definite, and he said:— I am told if you do it— he was talking about putting on taxes, you cannot avoid taxing the working classes" and in creasing the prices of the articles which the poo habitually consumed. I do not agree. He said, in other words, you may tax corn and it will not raise the price, and he goes on to say later, in the same speech:— I believe a small duty on corn, with preference to the Colonies, will tend to diminish rather than increase the price. That was the statement by the right hon. Gentleman in the heat of the election, but I understand he makes the same statement now, and he believes that not only would the taxation of corn not raise the cost of living, but that actually a small duty on corn with preference to the Colonies would diminish its cost. If that is his contention, I would like to know how he proves it. The only argument he adduced in that connection was that you could, by putting an import duty on corn, divert the purchase of corn which we require here from Argentina to Canada, or from one country to another, from countries where we could purchase not so well, to countries where it could be purchased better. Argentina and Canada are good comparison. I do not know what authority the right hon. Gentleman could have for saying that Argentina would be a bad corn-growing country.

Mr. BALFOUR

I did not mention Argentina.

Mr. RUNCIMAN

No, but perhaps the right hon. Gentleman will allow me to mention it. It is one of our particular sources of supply, and as it is I venture to say we may justly make a comparison. Argentina is undoubtedly a good corn-growing country, so is Canada; but in Argentina corn growing is much steadier than in Canada. Argentina is free from the late spring and early autumn frosts which often blight whole districts in Canada. Owing to the efforts made by public authorities the harm that used to be done to corn-growing in Argentina by locusts has been greatly diminished, so that there is no more steady source of supply than that to be found along the shore of the River Plate. The right hon. Gentleman only wishes to substitute one country for another. In what way does he increase the total amount of corn produced, and if he does increase the total amount of corn produced, in what way is he going to cheapen the cost? I venture to say the exact opposite will be the case. By taxation you put obstacles in the way of the production of corn, and you will tend much more likely to discourage the growth of corn than to increase it.

The right hon. Gentleman has forgotten the Birmingham programme, which provides that there shall be a duty of 1s. a quarter on Colonial corn—that is the last Birmingham programme endorsed by the right hon. Gentleman the Member for Worcester—and he is going to induce the Colonial farmer to put more land under wheat by putting a duty of 1s. a quarter on Canadian corn. As a matter of fact, the duty on imported corn is always put on with the deliberate object of raising its price. The Tariff Reform League agree with that. If hon. Gentlemen will look at leaflet No. 22, New Series, of the Tariff Reform League, with the heading "Salvation of Erin—Ireland's interest in Tariff Reform," he will see it stated: Ireland will secure both a higher price for all she sells in the English market by being protected from competition with America. Denmark and France, and she will pay less for all she purchases, the duties having been largely reduced. Let us make a rough Budget of the profit under the new fiscal departure for the Irish farmer. First there is the proposed duty on foreign wheat of 2s., and the profit represented by the advance in price in the English market will be 6s. per acre. That is what the Tariff Reform League have circulated.

Mr. JOHN WARD

What about the reference to dairy produce?

Mr. RUNCIMAN

The same holds good there. There is a definite statement by the Tariff Reform League that they believe, however moderate the import duty, it will raise the price of wheat. We have had a better authority than that. Perhaps I may be allowed to quote from the official publication of the German Government explaining the reason for the introduction of the tariff of 1902. It says:— A means whereby the agricultural interests are enabled to cover the cost of production is to be found under the given circumstances by creating a factor which will determine the inland selling price through relative protective duties. Inland prices are raised (as far as a consideration of the last ten years will allow us to judge) in proportion to the duties. And they proceed to show by tables, that the difference between the inland price and the price of foreign wheat, exclusive of duty, varies according to the amount of the duty. It is therefore to be expected that a raising of duties will favourably affect our internal agricultural interests. That follows exactly upon the same lines as the Tariff Reform League, and exactly upon the lines that we lay down now as Free Traders, namely, that if you put an import duty on corn it will raise the price of that corn. Now, in the last few weeks one of the largest milling companies in England added to its contracts to those who sell its flour this:— Should a duty on wheat be imposed, repealed, or varied, the price per cwt. of all flour to be delivered under his contract is at once to be increased or reduced by the same amount as the alteration of the duty per cwt. on wheat, whether the wheat used in its manufacture shall have been affected by such alteration or not. That is to say, whether the wheat comes from the Argentine, America, Canada, or Australia. If I may interpret the right hon. Gentleman's pledge in his own words, it promises nothing more than that when a direct tax is proposed or increased the amount of new food taxes imposed shall not exceed it. In other words, he is going to preserve the balance between direct and indirect taxation, which has been the rule of thumb with Chancellors of the Exchequer for many years past. The right hon. Gentleman said there had been much loose speaking on the subject of Tariff Reform, but none has been more glaring than on the subject of unemployment. This has passed through many phases. The vans sent out by the Central Conservative Association, for which the Chief Conservative Whip is responsible, had on their side: Fiscal Reform means work for all. When challenged to meet that assertion those in authority said what they meant was not work for all, but work for more. Finally, the right hon. Gentleman has whittled down "more" to "some," and he says the greatest part of the difficulty will be met by Tariff Reform so far as competent workmen in the prime of life are concerned. If that is not loose talk I do not know what is, and it has deceived many poor wretches in this country. One of the leaflets largely circulated by Tory candidates asserts that: Your employers cannot send the goods you make nto foreign countries. Why we send £14,000,000 worth into France, £25,000,000 worth into America, and £29,000,000 into Germany; and this is one of the grounds on which support is claimed for Tariff Reform candidates. Then they say: America, Germany, Russia, and all other nations put on high duties which keep our goods out and make trade unprofitable. It may be true that they make trade unprofitable, but, at any rate, they do not succeed in keeping out our goods. Then they say: We have lost all foreign markets, whilst their cheap and surplus products are dumped into our market. I think if any complaint is to be made about loose language on this subject we can lay the charge at their door that the statements made by them are not only loose in theory, but also in fact. They have not only deceived large sections of the electorate, but they have deceived them cruelly. They have attempted to bring home to them by wild promises and mis-statements the fallacy that if only we had a Tariff Reform Budget all their ills and miseries would pass away. The right hon. Gentleman cannot make out a case for unemployment on our general trade, but I lay a charge at the doors of the Tariff Reformers of much greater importance. Throughout the whole of their campaign they have done the best they could to talk down British industries. The hon. Member for Dulwich rejoices in the fact that he would be able to further his cause if we had two bad winters, and he thought that would give him more help than a great deal of argument. Now we have had two bad winters, and I hope he has got some satisfaction out of them. But although depression would help my hon. Friend, it has done definite injury to many British industries by advertising our failures and belittling our prosperity. There have been "bears" on the British market, and fine commercial travellers they have been for our commercial Empire.

I wonder whether hon. Gentlemen opposite realise that some of the best employment given to the counties of the North comes from abroad—from such places as Japan and Turkey. Will such customers be encouraged to place orders with our Yorkshire manufacturers when they are all the time being told by men in authority in this country, who have held high office, that our manufacturers at home are not able to hold their own, that our trade is going downhill, and that unless we have a great political change before long we shall become an insolvent nation? That is not likely to improve British credit, and it will not attract orders to our manufacturers at home. I think we had much better own up to the fact that we are a more prosperous country than any other in the world, that our goods are better in quality, that our workpeople are more contented, that our manufacturers have built up their industries on a better financial basis, and that the British article, good as it is, is still the cheapest article in the world, and will remain so as long as there is no attempt made to impede our sources of supply. If there is anything in the assertion that British industry is in any degree either insolvent or shaky? Money is still going freely into British industries. I know that Lord Revelstoke and Lord Rothschild said that it was impossible to get money for British industries. I may point out that £15,000,000 or £16,000,000 was invested in the Lancashire cotton industry a few years ago. At the present moment, bad as trade is, an enormous amount of private capital is being put into British industries in the North.

Both Noble Lords were evidently mislead by the fact that the flotation of loans and of new companies in the City of London had not been large during the last few years. But the Northern manufacturers do not come to London. Their Lordships overlook the fact that the banks have been doing a larger business during the last twelve months than they have done before. In 1909 deposits in banks went up by £30,000,000, and that money was not left there idle, because it was used as a definite investment, mostly in British industries. Anyone who looks down the Stock Exchange list will see that many of our industrial debentures are standing at a higher relative level than the national stock of Germany. Take, for example, Coats's. Their 3¾ per cent. debentures are standing at over 105, and that is higher than the German stock. Take Guinness's. These 3i per cent. brewery debentures are now standing very nearly at par. In the shipping industry the 3½ per cent. P. and O. debentures are now standing at 92. I know it may be said this company gets large subsidies for the mails, but what they get is only a fair remuneration for services rendered. Take, as another example, the Bradford Dyers. Their 4 per cent. debentures are now standing at 100; Armstrong's 4 per cent. debentures are standing at 100, and Pease and Partners' 4 per cent debentures stand at 100. There is not another set of debentures in the world that can be compared with these, and there is constantly a demand for them in the capital world.

Much harm may be done by the interference of amateurs in our great business concerns. Anyone who knows anything of the organisation of our great business concerns of the North knows what a very little difference in the organisation, in the management or in the purchasing price of the raw material makes all the difference between a profit and a loss. Fluctuations of the market will often destroy a whole year's work, and this danger will be accentuated a hundredfold if you allow those who know nothing about the delicacy of our industries to interfere with our supplies. Tariff Reformers think they will do no harm, but they do not understand these trades, and it takes a man a lifetime to become proficient in their management. Tariff Reform will interfere with 1,100 trades, and as Tariff Reformers have no intimate knowledge of those trades, they may do infinite damage in every single instance.

I wish now to refer to another side of the Question. One of my hon. Friends referred to the fact that you cannot have Tariff Reform without producing a tendency to corruption in public life. We have had during the last few months examples of that kind of thing not only in America, but in England. In America the organisers of different industries have been doing what is called "swopping" duties in the Senate. This has been going on in the Tariff Commission for years. You had a number of gentlemen sitting round the table trying to devise means to get higher prices. The Manufacturers' Association of the United Kingdom circulated in the month of December to all its members, under private cover, a long schedule asking in what way their members would like to see the tariff put up or down. The corruption likely to take place here would be different from that which we recognise as an ordinary part of American trade. Still there will be the tendency to collect money from prospective beneficiaries to operate for the purpose of getting a duty put on or taken off, to send out hired missionaries at so much a night to talk to innocent electors about trades which they do not understand, carefully selecting both their districts and the trades. The danger we shall run here from Lobbying is one from which we have, happily, been exempt for years passed, but anyone who knows anything about America or Germany will know that the very first year after a Tariff Reform Budget there will be more Lobbying in the House than there has ever been since 1848.

8.0 P.M.

A corrupt Government is bad enough, corrupt officials are bad enough, but a corrupt democracy is one of the most dangerous diseases from which any country can suffer, and I hope we shall be long spared from using the House of Commons for furthering private interests. Under Tariff Reform, agents, probably under new names, will come down here endeavouring to press and wheedle the Whips to get duties out of the Chancellor of the Exchequer because of the electoral force behind them, and they will endeavour to bully the Government by a threat of the cessation of political support unless these men get their way. All these tendencies will be new to English political life. Those who really respect its purity will be alarmed at the tendency they have seen during the last twelve months. We know that right hon. Gentlemen opposite are as pure as any public men can be, but they will be the mere tools of private adventurers; they are the amateurs who will be worked by the professionals, and if they find it worth their while professionals are not likely to scruple too much about the purity of public life. The charge we bring against Tariff Reformers on general grounds is that a tax on corn and meat will raise prices and inflict hardship; that their general tariff will increase the cost of production, and handicap our manufacturers in neutral markets and elsewhere. We say that their efforts will divert the main stream of industry, take it from its proper channel of national adaptability, and make it less productive. We say it will tend to destroy the delicate adjustment of the infinitely complex and specialised machinery of commerce and bring ruin not only to the organisers, but to the workers; of that commerce. To give control of these conditions into the hands of politicians or private trade organisations would be to not only alter the whole spirit of our public life in the wrong direction, but to ruin the trade on which we must depend for our very, subsistence. I think we may very well remember that this problem is by no means a new one in this country. The very evils from which our manufactures are now suffering are old evils. In 1842 the Common Council of the City of London stated them in language which may very well be quoted anywhere. At that time they complained of the continuous and increasing depression of the manufacturing, commercial, and agricultural interests of this country:— Capital without investment, trade without profit, the farmers struggling under a system of high rents, with prices falling as the means of consumption by the people fail, a working population rapidly increasing, and a daily decreasing demand for its labour. That is a condition from which I invite the House to depart and not to return. Every year since 1842 the condition of our people has improved. We now have not only the largest trade in the world, but the most comfortable workmen in the world. We have not only the greatest control of the manufacturing industries of the world, but we have the largest mercantile marine of the world. We have the greatest Empire and the finest outlet for our goods. The whole world is our granary. Whatever country suffers from bad harvests and famine, we, at all events, can rely upon an adequate supply. The United Kingdom, whatever its defects, and despite the large number out of work, and the misery suffered by a large section of our population, is still the best country in the world to live in. And the invitation made by the right hon. Gentleman to us to gamble with such blessings, to jeopardise our trade, and to complicate the whole of our relations with our self-governing Colonies and our foreign customers, at the instigation of those who either are not business men or are business men on the make, is an invitation to which the Government and the Liberal party answers a decisive no.

Captain SPENDER CLAY

I rise as a new Member, representing what the hon. Member for Swansea (Mr. Mond) called a "Division of the wilds of Kent," and I venture to speak to-night because the county which I have the honour to represent looks upon this question of Tariff Reform as one of vital importance to it on account of the large proportion of its inhabitants who are employed in the hop industry. In order that the House may realise the extent of the injury which foreign competition has done to the hop industry, I would briefly tell it the reduction which has occurred during the last three years in the acreage under hops. In 1906 there were 46,722 acres under hops, but in 1909 there were only 32,539–a reduction of 14,183 acres in three years. On an average an acre of hops costs £40 every year to till and bring to perfection, and that means a loss to the hop growing districts of this country of £567,326 in the short time of three years. It not only affects the grower and his farm hands, but it affects the tradesmen, the merchant who deals in fertilisers, the railways and canals, and it also affects thousands of men, women and children who leave the poorest slums in the City of London and other of our large towns and go into the hop fields for their yearly outing in order to earn a few pounds towards paying for their winter's bread, their children's boots, and also for their coal.

It may be urged that there has been a decrease in the consumption of beer. That may sound a plausible argument, but it is a fallacious one for this reason. During the last twenty years, since 1885, there has been an increase in the acreage under hops on the Pacific slopes of America alone of 38,000, and the importation of hops into this country has steadily risen. Notwithstanding a less consumption of beer in the country, the importation of hops has increased to the great detriment of the hop growers and the allied industries in this country. You may ask why the grower on the Pacific slopes is able to import hops into this country. The answer is that he is able to grow hops at a price from 35s. to 40a. per quarter less than we can produce them, largely owing to the fact that he employs Chinese labour. Hon. Members opposite may say it is a splendid thing. "Here are brewers buying in the cheapest market," but I would point out that in the case of hops, as in every other industry, it is only a temporary cheapness. As soon as the foreigner has destroyed the home market, the price of the commodity will go up. This theory of always wanting to buy in the cheapest market can be carried to excess. I know it is a theory held by Free Traders that labour is transferred from a non-profitable industry at home to a profitable industry at home, and that capital goes with it; but under Free Trade in practice labour is transferred from a profitable industry at home to no industry at all at home, and capital is very often transferred from that industry at home to the same industry abroad. In every single case of transfer of capital or labour there is a decrease in the employment of the British workman, and an increase in the employment of the foreigner.

Another point may be urged by hon. Members who know something about this industry. They may say, "But you have had good prices this year Why do you complain?" We have had good prices for hops this year because there has been no foreign competition, or practically none, but nobody can be bold enough to foretell that there will be no foreign competition next year. There is another argument which may be urged against a tax on imported foreign hops. It may be said that hops are raw materials. It is true they are part of the raw material of beer, but the hop is a highly manufactured article. It is not in its fully manufactured state, but it costs a great deal more to produce hops than it does to turn them into beer. We therefore say it is our duty, and I hope before very long we shall be able, to protect this industry from an utter extinction. It may be in the recollection of this House that there was a Bill introduced during the last Parliament to assist in some small way this afflicted industry, but that owing to the fact that it met with the opposition of some hon. Members opposite, who thought it infringed the sacred principles of Free Trade, the Bill was dropped. It had, I believe, the sympathy of the Chancellor of the Exchequer. The Chancellor of the Exchequer is popularly supposed not to be so deeply steeped in Free Trade fanaticism as some hon. Members who sit behind him. At any rate, he was the father, or the reputed father, of the Patents Act. I know the parentage of that Bill has been claimed by a gentleman who, I believe, is not a member of this House, but whether the right hon. Gentleman is the father or the father-in-law of that measure, it is a measure of high protection; it is a measure of prohibition. We ask for no such measure, we desire no such prohibition, and we ask for no such high protection, but we do ask that we should have equal opportunities of growing and of disposing of our hops as are at present enjoyed by the foreigner. I have therefore much pleasure in supporting the Amendment.

Sir T. BARCLAY

My object in rising is to apply myself more particularly to a part of this Amendment which has not been dealt with to so great an extent as other parts in the course of the speeches which have been delivered. I refer to the words that "a reform of our fiscal system" would "provide means for negotiating for the mitigation of foreign tariffs." In the course of the election campaign which I had to carry on, this supposed power, which would be given to the Government for the purpose of negotiating with foreign countries, was constantly placed before the electors as one of the greatest arguments in favour of Tariff Reform. There have been speeches frequently made by the Leader of the Opposition upon this subject, and the public, I think, has come to imagine that retaliation is the form of Tariff Reform which the Government would endeavour to force upon the country if the Conservatives were returned to power. I wish to point out that retaliation, having been tried over and over again, has failed absolutely, and to give the House my personal experience. I was for many years connected with the British Chamber of Commerce in Paris as chairman, as vice-chairman, and as honorary secretary, and I have had as much to do with protective tariffs as probably anybody in this Assembly. We in this country know little of protective tariffs, but during the last thirty years much information has been acquired of the working of such tariffs in other countries, and, as a result of that experience, we have found that Protective duties do not work out as has been suggested. Twice the French Parliament has had to raise these very duties for the purpose of keeping out foreign competition. Why is it that the tariff has had to be raised? It is very simple if you look at the matter closely. A general tariff raises the cost of production all round. After a while the rise in the cost of production eventuates in the foreigner being able to step over the tariff wall, and come in again on equal terms. That is the natural consequence of raising the cost of production. This argument was used not only on the last raising of the duties in France, but it is being used at the present moment. The Reporter of the Committee which has just completed its work in the Chamber of Deputies pointed out, as the chief argument for raising the duties, that those duties were not sufficient to keep out foreign competition. Surely that is not an argument in favour of our adopting a system which means simply the cutting off of our noses to spite our cheeks.

The Leader of the Opposition to-day pointed out that all these countries are adopting Tariffs, and he asks why we should not do the same. We might just as well have said 60 or 80 years ago that all the countries in Europe, except our own, were despotisms, and why, there fore, should not we also revert to despotism. The answer is very simple. France and Germany and other countries of Europe are in a lower state of economic development than our selves. We have achieved freedom of trade, and it is the chief argument of Free Traders in those countries that England has an enormous advantage over them through being able to produce at the lowest possible cost. As a matter of fact, where is there a country in Europe into which we cannot penetrate, or where is the neutral market in which we do not compete on equal terms with any other country? As a matter of fact, we not only compete on equal terms, we do so on better terms in the matter of the cost of production. The Leader of the Opposition made another remark, and it proved a very cogent argument in Lancashire during the course of the recent election. He said that the new German Tariff had enabled Germany to penetrate into the markets of Central Europe. The right hon. Gentleman cannot know everything about everything, and he seemed not to know that we had treaties of commerce containing the most favoured nation treatment with all the countries in question—with Russia, with Austria-Hungary, with Roumania, with Servia, and with Bulgaria. Where, in fact, is the country in Central Europe with which we have not a treaty of commerce or where we do not enjoy the most favoured nation treatment? If any of these countries grant a reduction of duties to Germany we get the benefit of those reduced duties. Where, then, comes in the argument about the penetrative effects of these treaties, seeing that they have no effect of which we do not get the benefit? Under the most favoured nation treatment we compete on equal terms in all the neutral markets of Europe. The right hon. Gentleman did not also seem to be aware of what followed in Germany and France when our negotiations for Treaties of Commerce with them broke down. In the case of France, my right hon. Friend the Member for the Forest of Dean (Sir Charles Dilke) took part in them. He was the representative of this country in Paris when the latest negotiations were being carried on there. What happened? Many of us had been contending—it was in 1882–that it was necessary to have some duties on our side to enable us to beat down the French opposition, and to obtain reductions of duties. But it proved hopeless, and we gave up the task. The following day a Bill was brought into the French Parliament, and adopted there and then, under which they gave us the benefit of the most favoured nation treatment. We only asked that we should be allowed to compete on the best possible terms, and we secured that; thus, with regard to France, we got the most favoured nation treatment, and the benefit of every reduction of duty allowed to any other country without any sacrifice on our part at all.

With Germany it is exactly the same. There, again, we have the most favoured nation treatment under an Act of Parliament.

What more is it that we can get by having duties on our side? Do you suppose that if we had a 10 per cent. duty we would have more effect than other countries with their 30, 50, or 75 per cent. duties? Yet that is the contention of those who say that, by retaliation, we shall be able to get better treatment in other countries. No Government and no Parliament in this country would dare to put on the duties which other countries have put on—or to the same extent. We should always hesitate, we should always be cautious about putting on duties that might do ourselves obvious harm, and we should continue with small duties which would have no effect beyond damaging ourselves, increasing the cost of production, and making us less able to compete in neutral markets. So far, in fact, as retaliation has been tried it has failed.

Yet surely we can do something in those European countries which are now being neglected. May I give an instance of how we neglect these markets? It is not Tariff Reform which will give them to us. I was in Austria-Hungary the winter before this, and examined the conditions of trade there and in the Balkans, and I ascertained, to my dismay, that no English manufacturer thought it worth his while to send out a commercial traveller to try and secure trade there. At Kolozvar, one place in the depths of Hungary, I wanted a pair of gloves. I went into a shop and asked for English gloves. The shopkeeper told me he had none, because the German traveller who sold to him brought the German samples first, and got his orders on them, although, as a matter of fact, there was a greater demand for English gloves, I told this to an English manufacturer, who explained that the reason why he did not send goods out there was that the Hungarian traders wanted ninety days credit, and they were only prepared to deliver against cash. At Fiume, on the Adriatic, I saw a large quantity of American boots on sale, and there seemed to be a demand for American goods of that character. I went into a shop and said, "Why don't you offer English boots?" and they replied, "We could gain 10 per cent. more on English boots, and they are much more in demand, and we should like to order some. If you like, take an order. Here it is for ninety dozen pairs of English boots and sixty dozen pairs of English tennis shoes." I took the order, and offered it to an English manufacturer, and he said the same thing—that he would not deliver unless for cash, or to a middleman who would be responsible for the payment, but he would not give ninety days credit to any Hungarian shopkeeper. You will not alter that fact by Tariff Reform.

Hon. Members may not know that for many years we supplied the whole of the American market with worsted gloves, and we lost that trade because we would not make the worsted gloves which were demanded by the American dealers. The trade went to a place in the centre of Germany, which is doing a great business in worsted gloves for the American market, because they made the article which is wanted. You will not cure the fact that we lost that trade by Tariff Reform, and what we want to do is to make ourselves more adaptable and alter our conditions of trade. Our bankers should act as a medium and ascertain what the credit of the purchaser is, and thus safeguard us from very many of the disastrous results which we have met with in our dealings with Central Europe. How are we to do this? The chief French and German banks have branches all over the world. When one of our manufacturers is more enterprising than others, he goes to one of the German or French banks and carries his transaction out through them. It is not Tariff Reform which is going to remedy these things, or any of the other evils which were put before the electorate at the last election.

I would urge, therefore, the necessity of taking this matter into our own hands, and that the manufacturers and traders of this country should pay more attention to their own methods. They should also give more attention to their commercial travellers. A commercial traveller in Germany is generally a man who is a partner or is going to be a partner in a firm, and who has the necessary technical knowledge to deal with the alterations which are necessary to meet the particualr market in which he sells his goods. I will give you an instance from Roumania. Some years ago I was in that country, and I observed that nearly all the agricultural machinery came from Germany. I made inquiries, and what I ascertained amounted to this: that we did not supply exactly the kind of machinery which the Roumanian requires. The explanation is very simple. The Roumanian is a happy-go-lucky person who does not put his machinery in a shed at night. He leaves it out in the open, exposed to the air, and the consequence is that the gearing gets clogged with oil and dew. The German manufacturer came along and said, "I can remedy that, and he covered up the gearing where it required protection, added an automatic oiler, and the Roumanian found that German machinery did the work better and lasted longer, though in reality the quality may be inferior to that of English machinery.

It is not Tariff Reform that we want, it is more knowledge of our own business, but in fact we seem to have so much business to do that we really do not care about these Central European markets. Many of our factories are full of orders. In the district in which I have been elected people are suffering very badly at the present moment. But I am glad that I have intelligent electors who do not suppose for a moment that they can remedy the present state of things by Tariff Reform, and they have sent me here with a mandate against it. We must not forget in this regard that small producers have no power of judgment in regard to these great issues. It is only the large trades, the big industries of the country, upon which the prosperity of the country depends, that can give a valid opinion, and these big industries seem to be in favour of maintaining the fiscal system which we have, under which we have prospered, and which it is my desire to record my vote in favour of keeping for the benefit of generations to come.

Mr. G. A. LLOYD

I am very glad that it is on this subject of Tariff Reform that I have the opportunity of speaking for the first time in this House, because it is a subject which I have had the honour of studying for some time past, both in regard to international trade and as a Special Trade Commissioner, appointed by the Liberal Government to go and inquire into trade matters in the East. I have also had considerable opportunities of studying problems in Imperial Federation, which I consider the most pressing problem as regards our Empire to-day. I do not propose to deal with the subject in any dogmatic way such as the hon. Member who has just sat down, and I do not think you can approach this great problem, or any problem of this kind, in a businesslike way if you lay down the law that no change can possibly be effected in our fiscal policy. I would like to say what other hon. Members have said to-night, that my interest in this question is not inspired by any party. Up to a few months ago I belonged to no party, and had been out of this country studying trade. I joined the party to which I now belong, because I thought that party was dealing with the trade interests of this country in the best and broadest way, and I also came to this general conclusion, that, if Free Trade was good it was only and could only be good if it was universal, and if tariffs were bad then, they were at least more bad, and for one isolated country set out as a target for the attacks of those countries which had tariffs, and whatever attitude you choose to take either Free Trade or tariffs must be universal if no country is to suffer. I clearly understand the hon. Gentleman who said the Labour benches must have some particular interest in these and cognate problems for many reasons, chiefly because, and here I would pay a very willing tribute from which I would rigorously exclude the Members of the Government. I believe that those who represent the Trade Unions of the country are in earnest—the best thing you can say about any politician—and although we fundamentally differ from them as to the way in which they wish to deal with it, yet, at any rate, they do not catch on to the skirts of one party or another to get their policy carried out. We know they will not carry their Free Trade proclivities into practice. I should like to see one of them get up and say that he is in favour of Free Trade for labour. I do not think anyone has ever said that, and yet that is the true Free Trade attitude. I do not think they would advocate the free importation of aliens or the free importation of all classes of foreign manufactures, but yet the present Government are in favour of Free Trade for labour, if only they dared to say so. They are Cobdenites absolutely and completely. It is only for party purposes that they back the trade unionists. Their position is absolutely ridiculous. Have they forsaken the Cobdenite principle of Free Trade in labour? If they have, we have gone a step further. They have thrown over their chief prophet. In fact, they are to-day, as regards the security of the country, in favour of national revolution, and as regards commerce in favour of Imperial devolution and nothing short of it.

I should like to take one instance of how Free Trade run mad can affect the shipping industry of this country. A good deal has been said to-night in regard to shipping, and we, on this side of the House, have been twitted with not referring to one of the most important industries in this country. I may take an example now from a country with which I have had something to do, that, namely, of British East Africa, where there is a very glaring case. I do not think anyone in this House would deny the absolute importance of an abundant supply of raw materials for our manufactures. What steps do the Liberals take to provide these raw materials? To-day they are in an indirect manner subsidising the production of raw materials in British East Africa to the tune of nearly 10s. in the £. They are doing this in an indirect manner because a direct bounty or a subsidy would doubtless be very awkward for their Free Trade professions. I personally am in favour of such a development in so great and so important a Colony which has vast areas of potential wealth in cotton and gram and many other valuable things. But there is absolutely no justification for asking the taxpayers in this country to subsidise the development of that young country by 10s. in the pound if you deliberately allow Germany to take all these raw materials from you by a system which only Free Trade exposes you to. To-day there is a system of German shipping and German preferential rebates, which are a most interesting subject, very complicated, and one very well worth studying, and by that system they are taking our raw materials to Germany which we ourselves are paying 10s. in the £ to get in England. [An HON. MEMBER: "What are they?"] Cotton and grain and many another smaller growth. That in my opinion is absolutely unjustifiable. Either the policy of the Government in subsidising it is wrong, or else their policy in not continuing the subsidy on a business principle is still more wrong.

The hon. Gentleman who has just sat down has made some quite astounding statements on the question of favoured nation treatment. I have lived for some years in the districts which he mentions as having occasionally visited, and I have had something to do with the making of the commercial treaties themselves. There is no one who has had any closer acquaintance with the making of commercial treaties, certainly not the Chancellor of the Exchequer, who would deny that the Free Trade negotiator is very much handicapped as against the negotiator whose hands are armed with a tariff. It is perfectly obvious. It is pretically childish for any business man to deny it. The best that can be claimed for favoured nation treatment is that it prevents discrimination by foreign countries as against British trade. Surely there can be no other claim made for it. That is the risk for which it exists, and it is the only risk to which we attribute any importance. Take the question of the Manchester trade. We are still predominant in the manufacture of cotton goods, and the chief causes which have kept the Manchester trade predominant are protective. One is the natural protection of climate. [HON. MEMBERS: "Oh, oh."] Does anyone dispute that? [An HON. MEMBER: "I dispute it."] It is well known that the climate of Manchester is unrivalled in the world for the manufacture of fine counts, and that is a natural protection which gives Manchester a predominance.

Mr. SHACKLETON

There is nothing in it.

Mr. LLOYD

There is another form of Protection which has kept the Manchester trade predominant as far as it goes, and that is that the Manchester Cobdenites have always rigorously exempted themselves from the Cobdenite theories and for the last fifty years have not allowed India to profit by Cobdenite principles, and have never allowed the Indian buyer to buy in the cheapest market. Will any hon. Gentleman tell me what would happen under the most favoured nation clause if Japan, for instance, intended to discriminate against Manchester goods? It is a thing which may very easily happen, and to a certain extent has happened already. Do you mean to say the most favoured nation clause could possibly save the Manchester trader in that case? What would the Japanese trader or the Japanese Government do? They would immediately impose low duties on those articles which came from countries which had a tariff and which Japan might be afraid of, and they would give the sublime gift of the most favoured nation clause and high duties to cotton goods coming in from all over the world, therefore discriminating particularly, and almost solely, against English trade. Many more instances, for instance the wine duties, can be given, but I think I have said enough to show the absolute futility of the most favoured nation clause, and if the Free Trade party rely upon that clause, which has already been abandoned by a very large number of Free Traders as being practically useless, they have very little to rely on. The Prime Minister during the last election campaign expressed complete satisfaction at the rapidity with which capital has been driven from this country. I wonder if he would express the same satisfaction publicly at an election time. People do not leave a system which is good to go to a bad one; they leave a bad system to go to a good one. What satisfaction has ever been offered to us for the loss to this country of so much human capital? None I ever heard of. As regards the gold which the Prime Minister is glad to say is going abroad, we are to console ourselves, or the workmen, for whose interest I care most, by knowing, as the Prime Minister says, that we are paid with dividends. What dividends have the working men in this country ever seen, and what satisfaction is it to the working classes here that the investment of capital is being made in the Argentine, and that though there is a loss of industry in this country the owners of the capital get dividends? What trade boom under the Free Trade system ever reaches working men? It never gets so far, because Free Trade can only benefit middlemen and merchants. It is our policy as Tariff Reformers to try to get the normal demand for labour nearly equal to the supply, so that when there comes a boom, as it is called, working men shall be able to profit by an increase in wages, and so be even with the manufacturers. The hon. Member for Merthyr Tydvil (Mr. Keir Hardie) said the poor people in this country could not afford to wait. I am inclined to agree with him. I do not think that they can afford to wait many weeks or months.

I have said that I am not an extreme party man, because I care infinitely more for seeing the working classes of this country made more prosperous than for anything else in the whole range of our aspirations. I believe you can only make a country prosperous by building up from the bottom and making the working classes contented and well off. I do not believe that a trade system which caters only for middlemen and the Manchester school can ever be good for the structure for permanent edifice of empire. Something has already been said with respect to the question of coal. It is said that only under Free Trade can great coal development take place. I happen to have the honour of representing a large division in which the coal industry is very prominent, and I can only say that though we have heard from the hon. Member from Newcastle-under-Lyme (Mr. Wedgwood) that he acquired his seat in this House through the enthusiasm of electors who returned him to achieve certain changes in the Constitution, I would not even exclude coal miners, who are not generally supposed to favour the Unionist cause, from those who have given an enthusiastic assent to the policy of Tariff Reform. The reason is perfectly clear. It is because the coal in the Midland areas of England is only valuable for one purpose, and that is as house coal, forge coal, or manufacturing coal. What is there to help these people to find a market in the future unless they can tempt British industries to come and settle here and to buy the product of their hands? The hon. Member for Merthyr Tydvil said they could not afford to wait any longer for a national system of insurance against unemployment. I would say that before that system comes in Tariff Reform must come in. I believe the country is coming round to be in favour of having some commercial system, and I know that the country in the very near future will turn to us for a remedy of those conditions for which the Liberal party are now to be held completely and solely to blame.

Dr. ADDISON

I will not follow the hon. Member who has just spoken through his general and sweeping denunciations of the Liberal party. He described the country as coming to be in favour of some sort of commercial system. I had the idea that we had a commercial system, and that we have had it for a long time. We have been for two days pursuing the elusive and ever-varying phantom called "Tariff Reform," and I must confess that the hon. Member did not enlighten us very much as to what it really is. So far as I can understand the latest proposal of the Tariff Reformers in regard to manufactured articles, it amounts to this, that the more work is incorporated in the article imported, the greater will be the tax, and that if there has been no work upon it, there will be no tax. I wish to apply this doctrine to an industry in the Constituency I have the honour to represent, and see how it would operate. The cabinet-making trade is one of the chief trades in the Hoxton division, and the gentleman who recently represented that constituency stated that it was part of the Tariff Reform scheme that tree-trunks should come into our ports free of duty, but that sawn planks would have a certain duty placed upon them according to the amount of work which had been given to them. Let us examine this concrete illustration. It is something to go upon. The hon. Member for Dover (Mr. Wyndham), speaking at Liverpool in December, 1908, advocated this tax on wood. We know that our cabinet-makers depend to a great extent on imported wood, such as American walnut, satin walnut, birch, whitewood, and oak. If a certain tax is to be placed on sawn woods, the exporters in other countries will be asked to send it to us in the form of tree trunks. In that case this will happen. A great many of these tree trunks will be found to be defective when they come over here. The defects will be revealed in the saw mill. Then it can be fairly estimated that the increase in carriage alone would practically double—that is to say, for the benefit of two or three men operating as sawyers we shall penalise all the men in that particular trade who now use wood which comes to us in the shape of planks. The next step in this process, as far as I understand it, would be that if parts of chairs were imported, as they often are, a somewhat higher tax would be imposed. During the last election we were provided with great entertainment in that division. A certain kind of chair is imported in wooden parts from America for the purpose of convenience. The chair is made, polished, upholstered, and so on in this particular district, and in one of the Tariff Reform shops this chair was exposed as having been "made in America." It so happens that only the pieces, the back, the seat, and so on, shaped roughly, were imported in that form. That gives a great saving in carriage and other expenses. About 70 per cent. of the cost of the chairs in labour was done in that constituency. Then, finally, you should have a further tax if the chair were polished, and more still if it were completely equipped and upholstered.

I think we can fairly ask to what tribunal of wise men and just are we to turn who will assess with equity the precise amount of duty which should be allotted to this particular import in its various stages of manufacture? To what tribunal are we to look which would equally assess the innumerable articles of manufacture which enter into the mass of British trade, so as to give not only protection against the foreigner, but satisfaction among the traders themselves? It seems to me that we should require a tribunal vastly different from any that we possess at present. However, I think we may take the comfort that there is apparently balm in Gilead. In the "Birmingham Daily Post" of 8th December, 1909, a famous programme appeared, and we were assured there that the system of imposing these duties on goods according to the amount of labour put into them was "very simple." It was upon a principle which would be readily understood, and would not lend itself to lobbying in the House of Commons. I can well understand that the House of Commons would dread the existence of lobbying in this Chamber as it exists in other chambers; but apparently this scheme, so simple, is exceedingly difficult of expression in this House, and many of us on this side still await some precise description of the method by which this kind of taxation is to bring more work and more wages into this country.

9.0 P.M.

For my part I think that this proposal has diverted our attention to one of the fundamental needs before the community which is existing at the present time. Here we have the Report of the Royal Commission on Afforestation, to which reference has been made so many times. Even if the estimate given be only half true, it shows, according to the Commissioners, that work for 18,000 men would be found during six winter months on the afforestation of 150,000 acres alone. We have therein a more valuable contribution, I think, to the solution of the problem of unemployment in the ranks of casual labour than all that Tariff Reformers have promised to do for us for a long time. Those of us who have worked in the very poorest districts in this Metropolis have, I think, another and much greater objection. It was my duty some time ago carefully to investigate the actual weekly income of the families whose children were receiving free dinners under the Act passed by the recent Liberal Government, and in this particular school district the inquiry showed that the wages which these families were living on were less than ten shillings a week. How are they doing it? One can hardly imagine. But there can be no pretence, I think, that Tariff Reform will result in any cheapening of food; and all of us on this side of the House, I am sure, are thoroughly convinced that it will increase the cost of living to these poor families. The result must inevitably be that their scanty pence will purchase less in the way of food and clothing than at present, and that they will crowd into more insanitary and worse dwellings, in order to make up by a saving in rent what they lose in the purchasing power of their money in the way of food. And I believe that the whole system of so-called "Tariff Reform," as far as we can understand it, and as far as it has ever been explained, will result, not in the mitigation of the evils of unemployment, but in increasing the cost of living and in physically and morally degrading to the poorer classes of this country.

Mr. H. PAGE CROFT

All parties have agreed in the course of this Debate that the greatest evil which we have in this country at the present moment is the evil of unemployment. I think it is also admitted that the ordinary resources of Free Trade have run dry. We have got to find work, and we have got to find money; and the scheme which is put forward by the party which sit on these benches is the only constructive scheme before the country which can possibly alleviate the condition of the unemployed. The right hon. Gentleman (Mr. Churchill), when he was President of the Board of Trade, issued a statement just prior to the election, in which he endeavoured to point out that if we had Tariff Reform we could not possibly get as much money by our 10 per cent. duty as we believed. He pointed out that, according to his reasoning, with which I entirely disagree, at least one-half or one-third of those manufactured goods would be excluded. If they are excluded the people of this country would still require that type of goods, and, in consequence, they would be manufactured in this country. It seems to me an extraordinary thing that we should hesitate to accept even that much which the right hon. Gentleman, speaking then with all his experience as President of the Board of Trade, showed us that we should get. It seems to me that when our people are out of employment there should be an attempt to adopt this system of Tariff Reform. What does it mean? It means that £41,000,000 annually will be given in trade to the people of this country. Under our system £41,000,000 annually means £20,000,000 in wages to the people of this country. Gentlemen on the benches opposite will agree with me when I say that the Minority Report of the Royal Commission on the Poor Law stated that £10,000,000, in the worst year, would be sufficient in order to mitigate the crying evil of unemployment. The consequence is we could, even under that argument—which, of course, was the worst argument possible, from the Board of Trade point of view, against us at the time of the election—we could practically mitigate the present evil of unemployment. The right hon. Gentleman, in his argument, pointed out that by this £41,000,000 being excluded we should lose the 10 per cent duty which we hoped to impose; but I think business men will be ready to recognise, as every producer and every manufacturer knows, that in the course of the year they have to pay 10 per cent. in local and imperial taxation. The result would be that, in addition to £4,500,000 or £6,500,000 revenue which the then President of the Board of Trade was kind enough to allow us to hope for, we should have £4,000,000 which would go to local and imperial taxation. But best of all—I am sure in the opinion of hon. Gentlemen opposite—we shall get £41,000,000 increased internal trade for the people of this country, and £20,000,000 of wages to the workers, who are in sore need of these wages.

I know that professors will hold up their hands and say that by this system we are going to drive away exchange of goods. Even if that were true—and I dispute it, because it is contrary to all the results of tariffs in other countries—it is no argument of real worth, for the simple reason that even if you drop your exchange of goods between London and France you still have your exchange of goods between London and Manchester, and, as a consequence, you get employment for twice as many people in this country as you would under the other system. The Labour party hold the proud distinction of being the only Labour party in the world who believe in an unrestricted policy of free imports. They are allied by a rather thin thread to the only other party which supports this policy, namely, the Liberal party. When the Independent Labour party came into this House in the late Parliament, I believed they would be an independent party, and would not work with any other party. I ask them why did they wed themselves to a party which, I believe, even in their opinion, is at this moment discredited. Why did they not maintain their independence? I believe if they had maintained their independence, to use Zulu phraseology, they would have eaten up in turn the Liberal party, and hon. Gentlemen opposite would have been already sitting on the crimson benches of the other House. Why did they attach themselves to a system, I think I may say a fossilised system, which was brought into being simply and solely to keep down the price of labour in the great manufacturing centres of this country? I believe if Members of the Labour party asked one of their leaders, the Member for Merthyr Tydvil (Mr. Keir Hardie), what he thinks of Free Trade, he would tell them that Free Trade is a sham. The very fact that you are successfully elevating the condition and raising the price of labour in this country—and in that, for what it is worth, you have my heartiest sympathy—is making it all the easier for foreign competitors to send their products into this country, where they undersell you. I believe hon. Gentlemen opposite will agree with me that, for the most part, in the country the cry was that the cost of living would be dearer. But two right hon. Gentlemen on the Front Opposition Bench pointed out that clothing is going to be no dearer, because practically no clothing comes from abroad. Then there only comes the question of food. I say "only," because I have some little experience of the corn market, and I think I can prove absolutely that by our policy of stimulating the production of wheat in the world we are not going to increase the price of wheat, neither are we going to increase the price of meat, if we give a preference upon that.

With regard to Imperial preference, I have no hesitation whatever in saying that I am a food taxer, if by taxing one sort of supply in the world we stimulate another source of supply and therefore obtain more wheat for the markets of the world. Everyone who has watched the corn market knows perfectly well that the price of wheat is rising year by year, and that some peoples of the world are growing more rapidly than the supply. I have no hesitation in saying that as long as you keep your policy of Free Trade and your policy of free imports you are running the risk of having to pay considerably more for wheat in future. The argument was offered by one of the speakers against the policy of Tariff Reform, that if we developed the supply from the Colonies it would take the place of supplies from the Argentine. I do not believe that the great fields of the Argentine will go out of cultivation. The wheat-consuming populations of the world are increasing, and every bit of wheat grown will be required in the future. You will keep these two great markets in cultivation, and I think that those who have the handling of large quantities of grain will admit that it is always the people who can offer the cheapest price who command the market. By giving preference to the Colonies, and preference to home producers, it is impossible for competitors with their supplies to raise the price of wheat. It is neither professors nor even lawyers who are going to settle this question. It is man-power which is going to increase the demand. Has not the population since 1860 only increased by 16,000,000, while that of Germany has increased by 27,000,000 since 1871, and that of the United States since 1S60 by no less than 60,500,000? I say it is impossible to stand unarmed against those great forces. Every man in this country creates wealth. Every unit in the country makes for the prosperity of the country. How, considering our position, can we hope successfully to meet those great, mighty nations which are going to compete with us in the future. The hon. Member for Cork (Mr. William O'Brien) a few nights ago, in a most brilliant speech, made a most patriotic appeal for Ireland. I say Ire- land, Scotland, Wales, and England will be as naught unless we can have a united Empire in the future to stand against the combinations of the world. I believe that in the British Empire lies our great hope of successfully competing with the great forces arrayed against us. I believe there is great danger in delay, because already there have been commercial treaties between our Colonies and other countries which will destroy the results of the preference which we hope to establish, and that we should do so very quickly. I believe only by union of the Empire can we establish that naval, military, and commercial alliance which will enable us to resist the increasing strain and pressure of the ranks of our competitors. For that reason I have great pleasure in supporting the Amendment.

Mr. SHACKLETON

I do not think I should have troubled the House to-night at all had it not been for statements made by the hon. Member for West Staffordshire (Mr. G. A. Lloyd) in regard to the cotton trade, and, having some little connection with that industry, at least from the operative side, I believe he is quite inaccurate, and I wish to make some corrections. Before I do so I should like to refer to the pleasure which it gives my colleagues and myself to hear the subject of unemployment so prominently brought before this House. We have received more kindly references to the sufferings of the unemployed within the last two days than has been my recollection to have heard here within the last two years. We may not be pleased with all the remedies suggested by hon. Members, but we certainly do agree with the importance of the subject, and thank those who are giving such prominence to it. I was surprised to hear the hon. Member who spoke last say that if we had only taken certain advice that by this time the Labour Members might have been on the benches in the other place. I regret, if that was a possibility, that we have not achieved that already. I can assure this House if that were a possibility we would soon make short work of that place. The hon. Member for West Staffordshire said that there was something peculiar about the Lancashire climate. I have been in cotton mills for twenty years myself. I have seen cotton mills in various parts of Europe, and I have been into some fifty in America which make artificial atmosphere for the purpose of making cotton cloths and spinning cotton. If the hon. Member thinks there is anything special about the Lancashire atmosphere I assure him not to have a doubt about it any longer. We have already discovered scientific methods for creating an atmosphere to carry on the work. As a matter of fact, there is more humidity in the cotton mills in Lancashire in proportion to the looms than in any other country in the world artificially created. The hon. Member is absolutely wrong. Although it is a general statement made at the election, it is never made in Lancashire.

Another statement was made that we were not able during boom periods, because of Free Trade, to obtain our share of the improved conditions. He is absolutely wrong. The trade of which my hon. Friend the Member for Bolton is an official gained 10 per cent. in the boom period, and have retained 5 per cent. of it at present. The branch of the industry which I represent gained 7½ per cent. during the boom period, and they still retain it. No country in the world in cotton manufacture can hold a candle with us in regard to the standard of living and the amount of wage we receive for the amount that we do. Then he said that we had prevented India from having the opportunity of the cheapest market. What a statement to make without a single fact adduced. This country, neither through the home Government nor the Lancashire trade, have interfered in no shape or form with the Indian. The statement was that we have prevented India from having access to the cheapest market. I challenge any hon. Gentleman or right hon. Gentleman to point out in what way the Government of this country, either under the guidance of the Liberal party or the Tory party, or the trade of Lancashire, has ever interfered with India.

Mr. G. A. LLOYD

The hon. Member has questioned some statements I made in the speech I recently delivered, and I will answer him at once across the floor of the House. I say it is perfectly true that Manchester trade has not allowed Indians to buy in the cheapest market. If he will turn back to the pages of history he will see that when the Financial Secretary, Strachey by name, left office, and when Lord Cromer came into office as Financial Secretary, the outcry that was made by the Manchester School at that period to put on an excise in India, so that they should manufacture cotton, and therefore give Manchester equal terms in the Indian market.

Mr. SHACKLETON

The question of excise and import duties in India is one of which I have considerable experience. I have been on every deputation with regard to it for the last twenty years, and the statement made by the hon. Member is not borne out by what was done on each of those occasions. All we demanded and got from each successive Government was that if an import duty was put on we contended an equivalent excise should be put on to secure for 98 per cent. of the trade in cotton in India to the Indian wearer the price that Lancashire produced it at, and not the fictitious prices which the manufacturer in India might be able to put on. I know the hon. Member's idea of benefiting India is not mine. His idea of benefiting India is to allow the Indian manufacturer, who has no popular electors to look after the interests of the workers, to so regulate industries in India as to suit his own ideas. So long as this House has control over India it is its duty to see that the poor people of that country are not made the tools of the governing classes there. I know there is a difference of opinion on this point. Our view of benefiting India is not the manufacturers' view; it is the view of the poor man, with his low wage, who has to buy the calico necessary to cover him. We believe that the policy of Lancashire has been in the interests of the great democracy of India, and that is why we have on all occasions supported the idea that an excise duty must in every case be put on where an import duty is imposed. The hon. Member also made a remarkable statement, claiming that the miners, or a section of the miners, of this country were in favour of Tariff Reform. The obvious answer is that in this House there are nineteen miners' representatives, all of whom have worked in the mines, and everyone is a Free Trader.

My next point is with regard to the price of food. Will right hon. Gentlemen opposite explain how it is that certain facts that we get from abroad do not tally with the promises made here? They say that the taxation of food is not to increase prices. Will they explain how it is that German and Italian flour is about as much dearer in those countries than it is here by the duty which is imposed? Will they also explain how it is, as is proved in the Board of Trade statistics, that for the four years ending 1908 the price of bread in New York was 10.7d. per 4lb. loaf, probably made from the same flour that is sent across here, milled in this country, and sold in our market for 5½d.—a difference of 93 per cent. in the retail price, while the duty on the raw material is only 25 per cent. How is it that these things obtain in protected countries? We are often challenged as being the only Labour party in the world supporting Free Trade. It is my duty once a year to visit some part of Europe to meet colleagues in the textile industry on matters concerning our own business. I have never come across a single Trade Union leader of note in Germany in the textile trade or out of it who is not a Free Trader. In reply to an inquiry made about eighteen months ago, one of my colleagues on the International Committee sent me a letter in which, after working out the difference in wages, hours, price of living and rent, he ended up by saying:— Taking hours of labour, rates of wages, and cost of food together, the English working man is 44 per cent. better off than the German. These are facts. We generally go to our colleagues in other countries to find out what they think of the system under which we are promised such nice things in Great Britain. Every issue of the German workers' newspaper during the last six months has had one phrase in reference to Protection in Germany, and that is "hunger taxes." I have seen copy after copy, and everyone of them ends up now by referring to Protection as "hunger taxes." Hon. Gentlemen opposite want to delude us as they deluded our forefathers before the Education Acts came into force. They must not forget that the Education Acts have been in operation for forty years. Some of us have had a little opportunity of learning from the age of nine partly in the mills and partly in the schools, and have done what we could since to read for ourselves. You are not going to tell us that the proper method of raising taxation from the workers is by an indirect system. You have to face that difficulty with the great populations of this country represented by labour. They have got past that stage. I tell the House frankly that any method of indirect taxation will have the strenuous opposition of the organised workers of Great Britain. It is because the Budget goes in the opposite direction and for the first time increases direct taxation and proportionately decreases indirect taxation that we give it our whole-hearted support. The fact that the Resolution before the House means an increase in indirect taxation, which, although it may not be so easily perceived, is still there, is one reason why we shall oppose it. We in Lancashire mean to know what taxation we have got to pay and the amount of it, and the party opposite will not delude us by any further system of indirect taxation.

The CHANCELLOR of the EXCHEQUER (Mr. Lloyd-George)

It was not my intention to take any part in this Debate, and I should not have done so had it not been for the very direct challenge addressed to me yesterday by the right hon. Member for East Worcestershire (Mr. A. Chamberlain). The right hon. Gentleman charged me with having made in the fiscal controversy statements which were purely the creation of my own imagination and having no foundation in fact. He specifically challenged me, and the challenge was a very sweeping one, to justify any statement which I made in the course of the General Election in reference to the fiscal question. I am glad the right hon. Gentleman has been good enough to make that challenge in the House. Last year I was constantly charged on the platform with having made untrue statements about the Land Taxes. It was then my duty to challenge hon. and right hon. Gentlemen to controvert in this House any of those statements, but I was never able to induce them to do so. I need hardly assure the House that it is not my intention to repeat all the statements which I made on the fiscal controversy in the course of a prolonged campaign, but I will take four or five, some of which were referred to by the right hon. Gentleman yesterday, and if he denies them now I will prove them.

I laid down during that controversy four propositions dealing with the fundamental facts of that controversy. The first was this: that this country, with its Free Trade system, still possesses the largest international trade in the world. Does the right hon. Gentleman deny that? Surely that is a very important statement. Let the House bear in mind that the charge is that I resorted entirely to invention, drew entirely upon my imagination, and that not a single statement I made about the fiscal controversy was true. I ask in regard to that very important first proposition I laid down, that we have still the largest international trade in the world: Is that true or not? At any rate there is one statement, and that a very important one, which is not merely true, but the right hon. Gentleman dare not challenge it across the floor of the House!

He knows perfectly well that our international trade of the last few years is something like £1,000,000,000. There is not a single country in the world which approaches us within hundreds of millions. What is one to do when one right hon. Gentleman challenges another with not making a single true statement with regard to a controversy, and then says: What on earth has that to do with it? Let me deal with the second proposition. I can give figures if the right hon. Gentleman challenges them. We run to very nearly £1,000,000,000. Germany does not come to £700,000,000. That second best is £300,000,000 short of us. France, with its great protection, stands at £427,000,000. The United States of America, that gigantic country, that continent with almost double our population—its whole international trade is only £626,000,000. Very well. That is the first thing. Let me come to the second proposition: that we have the largest export of manufactured goods in the world. Is that denied? That is not challenged. I have got the figures here. Our international export of manufactured goods is £83,000,000 above that of Germany. We stand at £296,000,000; France is £118,000,000 only. The United States of America are £156,000,000. Our export of manufactured goods is greater than France and the United States put together. That statement is not even challenged. The third statement I made was this: that we have the greatest international carrying trade in the world; and not only that, but that our international shipping was almost as great as the rest of the world put together. Is that denied? And yet I did nothing in the course of the election but invent, and now, when we are face to face my opponents dare not deny one statement. This is the method with which I was very familiar during the time of the Budget. Hon. Gentlemen challenged my statement on the platform, and refused to face me in this House. I have given three statements to-night. There is no hon. Gentleman here—not even the hon. Gentleman who used to sit for York, and now sits for Clapham (Mr. G. D. Faber)—who dares to challenge it. And if he dare not, there is no one else who dare.

Take our shipping. Our shipbuilding is 11,541,000 tons. The largest nearest approach to us is Germany. What is her figure? 2,800,000 tons. Four times the size, and yet that the nearest approach! We are higher than Germany, France, and the United States put together. We have twice as much tonnage. I will give the fourth statement I made during the election, and I invite anyone to deny it; and I invite the hon. Member for Dulwich, who will follow me, to deny that in this Free Trade country we pay higher wages than in any country of Europe. Is that denied? Who denies it? An hon. Gentleman shakes his head, but is there anyone who will pledge his authority that that is not correct? Germany, which I suppose is the next nearest approach to us—if hon. Gentlemen will just look at the Board of Trade reports and fortify themselves by them—they will find that German wages per hour are 75 per cent. of our wages. They are 25 per cent. less than ours. That is another statement that I made. The other statement that I made was that the hours of labour are shorter than in any other country in Europe. Is that denied? [An HON. MEMBER: "In the world."] I am simply referring to the statements I made in the election. I am simply here to answer a challenge, but I cannot get anyone to deny any of these statements, let alone challenge them. The fifth statement that I made was that the price of food and of the necessaries of life was less than in any country in the world. Is that denied? Very well. I do not know that I need carry that matter any further, but that I have been charged with invention. [An HON. MEMBER: "Black bread and offal."] I am coming to that, and I am going to justify it from official statements. So hon. Members need not be afraid that I am going to run away. The charge made against me was that I resorted entirely to my imagination and that no single statement could I substantiate that I made in the course of the election on the fiscal controversy. I point out five fundamental propositions that I laid down, and the right hon. Gentleman dare not controvert one of them. Let us get to the next charge. The right hon. Gentleman referred to the cost of living in Germany, and he quoted the Birmingham brass workers. He took very good care not to explain that the Birmingham brass workers had made their report before the scientific tariff which we are asked to accept was published. And there is another very important fact with regard to the Birmingham brass workers with which the right hon. Gentleman is well aware of, and if he is not, I have the pleasure of informing him for the first time. Three Birmingham brass workers went to Germany. Out of those three two were Protectionists when they went there. When they came back two of them were Free Traders—and they are still Free Traders!

They did not travel through Germany in a motor-car; they went there to report, and they were perfectly unbiassed, according to the right hon. Gentleman. Two of them, when they went out, were confirmed Protectionists, but, having gone there and seen the condition of life in Germany, two came back confirmed Free Traders, and have been ever since. That is rather an important circumstance in regard to the Birmingham brass workers. But they were not the only people who went to Germany to report. By an arrangement with several leading firms in Northampton a committee recently went to Germany to investigate and to report upon the condition of the boot and shoe trade there, and this is the conclusion they came to. I have taken this out of the "Times," but I have the actual report also. Their report concludes:— (1) We are of opinion that the knowledge we gained in Germany, and our knowledge of the shoe industry in Northampton are sufficient to enable us to say definitely that the average German hoot and shoe operative works longer hours and earns less money than the Northampton operative. (2) When the German operative has earned his weekly wages not only is it less in amount but the money does not go nearly so far, because the rent is higher and the taxed food is dearer than in Northampton. (3) That in no single point could we see any superiority over our home industry, if Protection does confer favours upon the shoe industry we fail to find them. If you want to find the superiority you had better not investigate it upon the spot. The right hon. Gentleman, also quoted our Consul at Frankfurt. I have some reason to complain of the right hon. Gentleman's methods of quotation. He charges me with imagination. That is the last charge I would bring against the right hon. Gentleman. I think on the whole it is a little better than mis-quotation. At any rate it has an intellectual side. The right hon. Gentleman quoted a passage from Mr. Oppenheimer about the improvement in German wages. He left off with a very interesting sentence. The very next sentence was:— That in spite of that the condition of the German working man did not compare with the English working man. I wonder why? He said he did not charge us with deliberately making false statements. He only charged us with not prosecuting our inquiries sufficiently. I really must make the same charge against him. If he only prosecuted his inquiries into this report one sentence further he would find something much more relevant to the controversy than what he quoted, and he would have found matter there which is exceedingly important. For instance, here is a sentence he might have quoted from the same report:— To sum up, a variety of reasons combined to render life in Germany more expensive, but chief among them—Protection. That is Mr. Oppenheimer, who was quoted as a great authority yesterday, and so he is, one of the ablest consuls in the Empire. He has pointed out constantly in the course of these reports how Germany has increased the salaries of its officials. Why? Purely because the cost of living has gone up through the Customs duty. He pointed out another circum- stance,that one-third of the increased expenditure on the army and the navy is due entirely to the fact that these new Customs duties have been put on. Now surely that is rather relevant to the inquiry as to whether these duties increase the cost of living or not. These are some of the facts that I recommend to the right hon. Gentleman, and if he will prosecute his inquiry a little further, to use his own phrase, he will probably find the matter very useful when he comes to investigate the comparative advantages of Free Trade and Protection from the point of view of cheap food for the working classes.

I now refer him to the Board of Trade inquiry. Wages in Germany were 25 per cent. less than in this country and the cost of living is 11 per cent. more according to the official Report of the Board of Trade. The right hon. Gentleman says, "Well, after all, it is the foreigner who will pay," but he does not pay in Germany. It is the German himself who pays. I call the attention of the House to this, that when Bismarck put a 2s. duty on corn he used exactly the same argument. I will give a quotation from his speech delivered in 1885, when he was proposing 30s. a ton duty upon imported wheat. It is very interesting. He said:— He hardly thought it probable that this duty would raise the price of wheat. It might, however, be the case; and if it did well and good. The farmer would benefit by the increase in prices, if any. The duties will certainly be borne by foreign countries, and why should not the Finance Minister of the German Empire accept duty which America and Russia are willing to pay. Is it America and Russia that pay? If it is, can the right hon. Gentleman, or any hon. Gentleman on the other side of the House, point out to me a single case where American wheat was sold a penny less to Germans than it is to this country? Quite the reverse. If anything, we can buy wheat cheaper and better in this country than any other country in the world. Who pays this 12s. difference between the price in Berlin and the price here? Not America or Russia, but the Germans themselves, and where Prince Bismarck failed the right hon. Gentleman the Member for East Worcester is not likely to succeed.

The hon. Member for Clapham (Mr. G. D. Faber) is very concerned about horseflesh and black bread and carrion and offal. I give him as much offal as he can stand from the reports of our own officials in Germany and a good deal more than his constituents will stand. [HON. MEMBERS: "Oh."]

Mr. WILLIAM REDMOND

Order, order! Bear it like men.

Mr. LLOYD-GEORGE

Does the hon. Member for Clapham or anyone deny that horseflesh is consumed in Germany by the working population? Is it denied that they eat black bread? [An HON. MEMBER: "It is rye bread."] Is it not black? ["No."] Is it not good? Really, hon. Gentlemen, amongst their other defects, are even colour blind. The Germans themselves call it black bread, and that is how you order it. ["No."] Well, what is its colour? I should not have thought there was the slightest doubt about that. I have heard many hon. Gentlemen opposite say it is excellent stuff for the workmen. I should like to know how much the hon. Member for Clapham consumes. I expect he diets himself very strictly. This bread, which seems to ordinary individuals to be black, this rye bread, which seems to be perfectly white to hon. Gentlemen opposite, the Germans themselves call "black" bread. The hon. Gentleman charged me with having said it was food which we would not give to our tramps. Now what did I say? I will tell hon. Members what I said, and then the House will see that I am not exaggerating. I said, "Hon. Gentlemen say that this black bread is excellent stuff, very nourishing, very palatable, and exceedingly appetising."

I said in Devonshire, "You test it; have you any tramps?" They said, "Yes." I said, "The next time tramps come round you keep two or three loaves of this black bread, and every time a tramp calls give him a good chunk of it, and you will get rid of them as effectually as if you had given them rat poison."

Is horseflesh denied? Is it denied that there is a very large consumption of horseflesh in Germany? ["Yes."] It is denied, then. In that case I will give the figures. The right hon. Gentleman referred to the case of Chemnitz. I can give the figures for Chemnitz, not from leaflets, but from official returns of the slaughter in the municipal slaughterhouses there. There ware 646,000 lbs. in weight of horse meat slaughtered there for consumption by the prosperous inhabitants of Chemnitz. That is a very considerable quantity—a great deal more than the inhabitants of Clapham will stand. They also slaughtered in the same year in the municipal slaughterhouses of Chemnitz for food 15,000 lbs. of dog. I do not know what hon. Members would call dog, but I should call it offal; the hon. Member opposite would probably regard it as a delicacy. There you have this 646,000 lbs. of horseflesh, which in this country would be regarded as carrion, and 15,000 lbs. of dog, which would be considered here as offal.

Now let me read the report with regard to France. They also slaughter horses, and let me also state another fact, donkeys. Hon. Members can now seriously reflect on some of the perils of Tariff Reform. Is that offal, or is it good meat? I know black bread is recommended to the workmen, but what about dog, horseflesh, and donkeys? At any rate, it may be said that it will be "dog cheap," and that is the only cheapness there is about meat in Germany. Now take the price of horseflesh there. It is dearer than good meat in this country—a fillet steak of horseflesh is about a penny per pound, and it is said that it is excellent stuff. Did hon. Members opposite notice yesterday the report of the meeting presided over by the Duke of Portland, protesting against the exportation of worn-out, broken-down horses to the Continent, at which it was said that 50,000 had been sent. What for? Not for traction, but for consumption—for sausage. An investigator of the Board of Trade was told at one place that the horse butchers complained of the disastrous effect of electric traction in this country upon their meat market, and they could not hope to keep up the supply. The right hon. Gentleman said:— Why do not you follow the great example of Germany, where there is plenty of work and plenty of food? That is the idea which he sets forth. The greatest commercial paper in Germany the day before Christmas Eve said it was the saddest Christmas Germany had ever had almost since the foundation of the Empire. It is that sad condition of things we are asked to repeat here. ["Oh!"] It is. The right hon. Gentleman yesterday specifically based his case on the example of Germany. Does anyone deny that that appeared in the Frankfurt paper, the greatest commercial paper in the German Empire? Here is the original paper itself. The right hon. Gentleman said Protection did not bring black bread to Germany. No, but it has kept it there. We had black bread in this country in the old Corn Law days. It was the staple food of the people. We have left the black era of Protection, and I earnestly hope that this country will not commit the folly of re-entering it.

Mr. BONAR LAW

The right hon. Gentleman has delivered a very characteristic speech, a speech, the ability of which of its kind nobody would be less inclined to doubt than I. I can assure the House and the right hon. Gentleman that I do not intend to try and imitate it. It is not necessary for me to say, perhaps because I would not if I could, but because I could not even if I would. Of his kind the right hon. Gentleman is so supremely excellent that even the right hon. Gentle man who sits beside him (Mr. Churchill), who began competing with him in the early stages of the election, gave it up absolutely in despair, and left the Chancellor of Exchequer to reign alone and supreme. I am bound to say that in my opinion the speech which the right hon. Gentleman has just delivered justified in every particular the charge which was made against him by my right hon. Friend (Mr. Austen Chamberlain). I heard the speech of my right hon. Friend. He does not recollect, and neither do I, that he made the statement that absolutely every assertion made by the right hon. Gentle man (Mr. Lloyd-George) in the election was false. At all events, if my right hon. Friend inadvertently made that statement, I am sure hon. Gentlemen opposite will agree with me that it was obviously going too far. [HON. MEMBERS: "Let him with draw."] If he made it, I am sure he would be ready to withdraw. None of us for a moment would suggest that the right hon. Gentleman could have made so many speeches without having made some accurate statements. I do recollect that the charge which my hon. Friend distinctly made against him was that he had asserted that Protection brought black bread to Germany. That statement was absolutely untrue. He has now made great play with the fact—

Mr. LLOYD-GEORGE

I am sorry to interrupt the hon. Gentleman, but he has rather challenged the accuracy of my quotation. I have the OFFICIAL REPORT here, and I see the right hon. Gentleman (Mr. Austen Chamberlain) is reported to have said: "I invite the Chancellor of the Exchequer, I think I might almost say, to prove any single statement he made on the fiscal question during the course of the election."

Mr. BONAR LAW

Even according to that report it is very much more qualified. Let me try to prove what I have said, that the speech of the right hon. Gentleman has justified in the main the charge of my right hon. Friend. He has shown from the speech he has made to-day and by the quotations from other speeches that he implied to the audiences which he addressed that the German workman was in the habit regularly of living upon horse- flesh. The right hon. Gentleman had a great advantage over me in this matter. He had the whole of twenty-four hours to examine and criticise the speech of my right hon. Friend. I have not had any such opportunity, but I do recollect reading a statement made in a German newspaper by a Socialist economist, Professor Kalver, in which he absolutely ridiculed the whole idea that the use of horseflesh played any part in the German industrial life, and, what is more, he described it, I think, as another example of our insular ignorance and insolence. The way to test that question—I have seen the figures, but I do not remember them, and therefore cannot give them—is to give the proportion of horseflesh—it is published by the German Government—used in the whole German Empire to the quantity of meat of other kinds, and I venture to say that that total will not be found so large as that given in a statement which has just been handed to me by Sir Shirley Murphy, the inspector of the London County Council, who reported that 1,000 tons of horseflesh was sold in the East End of London in one year recently. [HON. MEMBERS: "Cats' meat."] I am only giving it as the report which has been handed to me at this moment. That statement says that the great bulk of it is not used for cats' meat, but is consumed by poor people in this country. Now I come back to the question of the black bread. It was rather a curious circumstance that just at the time when the elections were rather going against the party to which the right hon. Gentleman belongs he and his right hon. Friend beside him revived this old story of black bread and horse- flesh which we thought had been buried four years ago. Some people can use that kind of argument with perfect honesty, but both of these right hon. Gentlemen were sinning against the light. They have both been in Germany. The right hon. Gentleman, as we all know, with that proof of the efficiency of his Government which we were told was going to be one of their chief characteristics, first passed an Old Age Pensions Act and then rushed over to Germany to study the conditions of old age pensions there. The right hon. Gentleman the Member for Dundee has also visited Germany. We all know that he went over to act as an inspector of the German Army manœuvres, and I have no doubt that if the Emperor gave him the opportunity he would tender him a good many tips as to the proper way of conducting an army. Well, both of these right hon. Gentlemen know—. I do not think they could fail to know—I never met anyone who had visited Germany who did not know—that this black bread which they held up to the ignorant workman as proof of the deplorable condition of the German people—[MINISTERIAL cries of "Why ignorant? "]—ignorant in this respect, my meaning must be perfectly clear, they are ignorant of German conditions, and it was suggested to them that the eating of black bread is proof of the deplorable condition of the German people—everyone who has visited Germany must be aware that that kind of black bread is supplied in the best hotels and restaurants and is eaten by precisely the same class in Germany as those who dine in London at the Ritz.

I could not avoid taking up some time with the speech of the right hon. Gentleman, but I should like, if I may, to deal more generally with questions which interest me in a much more emphatic manner than the dialectics of the right hon. Gentleman. In speaking at the end of a Debate like this, a Debate which has been one of the most interesting in which we have taken part, the difficulty is to decide with what aspect of the Question, the whole ground of which has been, covered, one should attempt to deal. I should like simply to state our own case for Tariff Reform, but I am afraid that to do that alone without attempting to meet the arguments which have been advanced, would be treating the House of Commons in a way in which old Members should not treat it. We are, in fact, not expected to make our own speeches entirely irrespective of those made before. I shall try, therefore, to do a little of both—to deal slightly with the arguments, and to state our own case as well. The right hon. Gentleman who spoke before dinner, the President of the Board of Education, said that my right hon. Friend the Leader of the Opposition had at last made a completely Protectionist speech. I think the mistake which underlies that statement is that both the right hon. Gentleman and every Member who has spoken in this Debate, and all perhaps who have spoken on public platforms, not only call themselves Free Traders, but have used Free Trade arguments. But the system of Free Imports and the system of Free Trade are not the same thing. It is not a difference, in my opinion, in degree; it is a difference in kind. It is a difference just as real, though not to some extent, as the difference between Free Trade and Protection. Free imports mean simply the right to buy without restriction; Free Trade means more than that, it means free exchange. It means the right to buy, but it means also the right to sell, and a system of Free Trade can be destroyed, and in our case, in my opinion, has been destroyed just as completely by barriers erected which prevent us selling to other countries as it can be destroyed by barriers interfering with our buying by ourselves. The Chancellor of the Exchequer has given to-night a proof of his powers of rhetoric, and, in fact, during the last election, on many occasions when I was addressing a large audience, I would have given a great deal to have one-tenth of his powers in that direction. He gave a sample of it on the point with which I am now dealing. In one of his speeches he said—it is rhetoric and I do not know whether he will think it is good rhetoric—this: You look at the design of things and you will find that Providence intended free exchange between nations, and the result is that we enjoy the benefits which God has given the children of men all the world over. The ways of Providence are indeed mysterious if it is part of the Divine law that German manufacturers should come into English markets without restriction, and English manufacturers are to be prevented, as far as they can be prevented, from going into Germany.

The question, therefore, which the House and the country has really to decide now is, not whether Free Trade or Protection is best; the question is a much simpler one. Whether it is wise for us as a nation to leave our market open to the unrestricted competition of our trade rivals when they rigorously close their markets against our trade? Upon that point is it to be decided, as my right hon. Friend the Leader of the Opposition expressed it this afternoon, that experience should count for something? If you take experience everyone admits that we stand absolutely alone among all the nations of the world. It was not always so. At one time or other every one of our great trade rivals, Germany, France, even the United States, attracted by the simplicity of Free Trade theory and influenced by the apparent success and real success at the time of this country did approach to a system of duties which were only revenue duties, and nothing more. Take for instance Germany; in the middle of the seventies—about 1875–their duties were at a very low level. I have read a great deal about the fiscal history of Germany at that time and in the German Parliament then there were gentlemen who were repeating precisely the same kind of arguments which are being used now, and there were some gentlemen who were almost as good at rhetoric as the right hon. Gentleman himself. I am only giving this from memory, but I am sure it is pretty nearly accurate. A member who came from one district in Germany in 1877, I think it was said this: We who are from the provinces bordering on the Baltic who use iron but do not produce it, will never cease so long as a ship sails upon the ocean to demand that iron shall be free. Is there a member in the German Parliament now for the Baltic Provinces or anywhere else who makes that demand? [Several HON. MEMBERS: "Yes."] There is not one. ["Oh! Oh!"] The right hon. Gentleman is trying to compel me to deal with the shipping question, and I will do it later on if I have time, but I would rather go on with my argument in the meantime. Is it doubted that there is nobody in Germany now who desires to return to our system? In one of those outbursts of rhetoric, which I think sometimes have their disadvantage, the Chancellor of the Exchequer told an audience that the Germans were fools because they were Protectionists, and the very same day, as it happens, on which I read that speech, I read the address of the Secretary of State for War to his Constituents, in which he said that wherever we were beaten in trade it was owing to the greater scientific methods of our opponents. Here you have it: they are fools, and yet they beat us by their scientific methods.

There is another method of dealing with the question. The hon. Member (Mr. Ramsay Macdonald) made a statement about this which greatly surprised me coming from him. If he does not think it impertinent of me to say so, I always respect his speaking in this House. I think he is one of the best debaters we have, and for that reason I am amazed constantly to find that he makes statements such as that, and that he also occasionally uses arguments which I think the Chancellor of the Exchequer would disdain—even at Limehouse. The hon. Member actually said that the German people were in favour of Free Trade. I challenge him, and he can take plenty of time about it, to produce a single Member of the German Parliament, including the Socialists, of whom there are a good many, who has said to his constituents that he was in favour of leaving the German market open to the unrestricted competition of British manufacturers.

Mr. RAMSAY MACDONALD

I accept with pleasure.

Mr. BONAR LAW

I will give my challenge if the hon. Member is going to accept it. In the meantime I shall show that at all events I have good authority for my statement. Mr. Francis Oppenheimer, the Consul to whom the right hon. Gentleman has already referred, in the report sent to His Majesty's Government, makes this statement:— To-day, the expression Free Trade is never heard in Germany in the discussion of German affairs. And he goes on to say:— out of 397 Members of the Imperial Parliament, including Socialists, not one is pledged to Free Trade. It is not merely foreign countries. Of our own Colonies everyone can teach us the same lesson. They all for a long time adopted the policy of the Mother Country. They have all abandoned it. The hon. Member made another statement about Australia which was as amazing as his statement about Germany. He said we cannot claim that the Labour party in Australia are Tariff Reformers. That is perfectly true. They are not. They are what the Labour party is in this country when it deals with its trade unions. They are not Tariff Reformers but they are Prohibitionists and extreme Protectionists. Of all the parties in Australia who are pledged to Protection of one kind or another, the Labour party is the most extreme, and the hon. Gentleman, when he talked about new Protection imagined that some interjection of mine, which I was not conscious of making, implied that I agreed with him in the folly of Protection. That was not really what I meant. What amazed me was that one of the leaders of the Labour party in this country should have held up to ridicule the attempts of the Labour party in another country to improve the condition of the working people. It had nothing whatever to do with Free Trade or Protection. The price boards to which he referred had nothing to do with Free Trade or Protection. I admit that they are very absurd—almost as absurd, but not quite, as the panacea of the hon. Gentleman himself for all our evils in what he calls the Right to Work Bill, which, if it were given its real name, ought to be the Bill to give a man the right to be paid for work which he does not do.

I think the fiscal history of Canada is by far the most interesting of that of any country in the world for us. In 1879 the Leader of the Conservative party at that time carried Tariff Reform in Canada. It was bitterly opposed by the whole Liberal party in Canada just as the Liberal party here are opposing it now. The wheel of fortune went round and the time came when the Liberals came into power. They won an election under Sir Wilfrid Laurier, and what happened. So far from taking away the Protective Duties which existed before, they increased the scale of protection. What was the explanation of that? I remember reading at the time of the last election which was won in Canada a very interesting article in a paper I sometimes read. It represents the quintessence of Radicalism. I mean the journal called the "Nation." That journal said of this victory that it was a personal triumph to Sir Wilfrid Laurier, but it represented a sacrifice of Liberal principles on the altar of material prosperity. Well, I think in this country we might submit to the sacrifice of a few Liberal principles on the same altar with a pretty good grace. Let me give Sir Wilfrid Laurier's own explanation. He said after that result, "As before I am a Free Trader." He was given the medal of the Cobden Club, and he did not forfeit his title to it by the action he took. His explanation was that the fiscal system of Canada was dictated to her by the fiscal system of her gigantic neighbour. That is good doctrine according to Adam Smith, who said that one country may be compelled often by the bad fiscal policy of another country to adopt a fiscal policy which would not be the best in itself. It is not a question between Free Trade and Protection. Sir Wilfrid Laurier said that so long as manufactures from the United States poured into Canada without restriction, and so long as Canadian manufactures were stopped the moment they reached the American border, it was impossible that a manufacturing industry could grow up in Canada. He also said that under the old conditions the best and most energetic of the young men of Canada were leaving it and crossing into the United States in order to find the better conditions of employment which were to be found there. After thirty years of Tariff Reform what has happened? Canadians are not crossing the borders to the United States. The reverse is happening. Americans are pouring in ever increasing numbers into Canada in order to enjoy the benefit of the greater natural resources which Tariff Reform has developed in Canada.

I shall try now to deal briefly with some of the more important arguments addressed in this Debate against our proposal. First take the subject of taxing the foreigner. Even the two days' Debate has been very instructive to hon. Gentlemen opposite. When my hon. Friends behind me yesterday spoke about the possibility of taxing the foreigner the suggestion was received with universal jeers, but when my right hon. Friend the Leader of the Opposition this afternoon spoke on the same subject none of the hon. Gentlemen opposite admitted that they had said that the consumer always paid the tax. Yet on every one of their platforms without exception it was stated as if it were an axiom with politics that the consumer always paid the duty. It is not an axiom of the study. It is only an axiom of the political platform. In the course of the election I have looked through every one of the orthodox political economists in this country. There is not one of them who takes that view. I am not going to read any extracts, but I shall read the opinion on this point of one of the fourteen professors who wrote the famous letter:—Professor Peake: "Economists are agreed that a part of the direct burden of import duties is in general shifted permanently on to the foreigners." But I do not base my case upon authority except to show that those who claim that we are talking nonsense have no authority behind them. I base it on common sense and common experience. I was myself for twenty years in business, and I never came across a case of any commodity which was always the same for all markets at the same time. I never came across any commodity where the price was not occasionally, at least, modified in order to be able to make an entry into markets which had high duties.

Suppose we were to put a moderate duty on some manufactured goods which are coming regularly into this market from Germany to-day, what would happen? The German manufacturer has only two alternatives. He may try to sell at the old price, plus the duty. How can he do that? He has always been in competition with the home producer. He has got the highest price which he could obtain against that competition. If he adopts that course he must lose his market. What is his other alternative? If he has been making a profit it is still to try to keep the market or a share of the market and to be content with a smaller profit. I ask the House, especially those engaged in business, to remember that he has the strongest interest to do that, even sometimes when he has no profit, because the cost of everything which he produces, what is sold at home as well as abroad, is lessened according as the total of production is raised, and if the cost of production diminishes, then the cost, on the other hand, goes up. But to whatever extent he sends his goods into this country at a reduced profit, to that extent he makes a contribution to the British Exchequer and to our taxes. I have said that every Member assumed that the consumer paid the whole duty. [An HON MEMBER: "No."] There is one exception. The late President of the Board of Trade has made his full share of the 149 speeches by Cabinet Ministers to which my right hon. Friend referred. But he has this distinction, that while he has certainly made many speeches, he has made more serious speeches. We know that on the best authority. The right hon. Gentleman was so much impressed by the fact that he mentioned it himself on one occasion. In making so many speeches it is not unnatural that he should have taken up both sides of the question. In one speech, which showed that it was a pity that he has been so quickly transferred from the Board of Trade, because I think he was beginning to learn the lesson which that Department ought to teach him, he did admit that there were some cases where the foreigner paid the duty, but, of course, he said this was owing to temporary circumstances only and to exceptions. He had an argument to meet that case also. It is an argument with which we are very familiar—it is a moral argument. They have put themselves on a lofty pedestal, from which they look down on the publicans and sinners in the world beneath them. This is what the right hon. Gentleman said: That the finances of this powerful country should stand on so paltry and pitiable a basis as that of the filching of a million or two from the labour of neighbouring nations with whom we do traffic, would be utterly contemptible if it were not absurd. These are very noble sentiments. I can assure the right hon. Gentleman and the House that when the time comes we shall not stand on so lofty a pedestal; we shall not be above extracting even a few millions from the foreigner who condescends to take our trade, and we shall know that every million obtained from that source means a million less taken from the pockets of our own people. It may be said, and it was said, to my surprise, by the present President of the Board of Trade, that if the foreigner pays a duty, one small duty, why not a large duty, so as to make him pay more? I think hon. Gentlemen opposite have one disadvantage, at least it seems to me so, that they are so sure of their position. They are always ready, if I may say so without offence, to make speeches about this subject, but they are not often inclined to think about it.

Mr. W. THORNE

Have you a monopoly of brains?

Mr. BONAR LAW

If the hon. Member thinks about it for a moment he will see that it is only because the duties are small that there is any possibility of the foreigner paying a part of them. Obviously, if you raise the duties to a level high enough to prevent the goods coming in, that takes away all the profits there can be, there can be no competition, and the foreigner can pay none of them. That brings me to another argument connected with it which is a great favourite with the Prime Minister. He puts this conundrum: How can you get both Protection and revenue? If the goods come in you will get revenue, but you will not get Protection. If they do not come in you get Protection, but you will not get revenue. It is a very unanswerable conundrum, but I will answer it in the Scotch way by putting another: Does the German tariff do so? There is no doubt about it giving revenue. In the last official Blue Book the Board of Trade gave the amount of revenue received from manufactured goods in Germany during the last twenty years, and, in spite of their tariff, the amount of that revenue has more than doubled in that period. There is no mystery about that. It simply means that the fact of the German tariff giving them security in their own home market has so increased their total trade and their total production that, though the proportion of manufactured goods imported is much less than it was, the total has actually increased. I do not think there is much grievance in that, and I have no doubt that the same thing would happen in this country. It was the same twenty years ago. In that period the total has increased; but sup- posing it had not happened; suppose the quantity of goods imported had diminished, even then, I think, we have an answer which ought not to be unsatisfactory to hon. Gentlemen opposite. In fact, it is a curious question coming from them. The Chancellor of the Exchequer, when defending the liqour duties in his Budget, told us at the beginning that they were imposed entirely for the sake of revenue. The Budget discussion took a long time, and before it came to the end it was found that that was a mistake, and that the excessive nature of the duty was drying up the source of revenue. The right hon. Gentleman, who has great qualities, and whose flexibility is the greatest of them all, was quite ready to meet the new situation and trim the sails of his ship to meet the altered wind. He said, "Well, if we do not get revenue, at all events, we will get temperance." We are entitled, and with much better reason, to give a similar reason. If the goods come in we will get the revenue, and if they do not come in we will get the employment. As was pointed out, unanswerably, I think, by an hon. Friend yesterday, increased employment will mean increased paying power and increased income tax, which will make you still get the duties indirectly instead of getting them directly.

I should like to deal with an argument which is used still more frequently, if it can be called an argument. It consists in repeating, as has been repeated by hundreds of orators on thousands of Radical platforms, of this copybook heading with all seriousness and with the same amount of thought with which it would be repeated by an intelligent parrot, "Imports are paid for by exports." They think that settles the whole fiscal system. It has no more to do with it than with the position of the House of Lords, absolutely nothing more to do with it. The right hon. Gentleman the Prime Minister put the case in one of his speeches in Scotland with that clearness which characterises all his utterances. He put it this way: If goods come from abroad, they are paid for by goods made at home, and if the goods do not come from abroad the goods are not made at home, and you lessen employment instead of increasing it. The right hon. Gentleman was at one time not only a student but a teacher of economics; and I venture to say that if one of his pupils had put that proposition in the same crude way he would have ploughed him without the slightest hesitation. The economic position on the subject was stated in the book referred to by my hon. Friend, one of the Members for Glasgow (Mr. Mackinder) yesterday. Professor Nicholson said: "Of course imports are paid for by exports, but whether or not they immediately lessen employment depends upon whether we are passive or active in securing those imports—in other words, whether those imports come as a result of an expansion of our trade which has found new markets, or whether they come in substitution for other goods which were made at home and were paid for by the same goods." Let me put a concrete case. Suppose that in a good year a sheet-maker buys a thousand pounds worth of steel billets from an English steelmaker. Those goods are paid for by goods just as much as if they came from abroad. It gave two employments—to the maker of the sheets and to the maker of the steel. Suppose that in the next year owing to a slump in prices in Germany the German manufacturers, in order to keep up their output cut their prices to such an extent that the English manufacturer cannot compete, and send the goods in. The German goods simply take the place of English work, and they are paid for by precisely the same goods which would have paid for British goods, and employment is given to one set of British workmen instead of two.

The statement that imports are paid for by exports would be accepted just as readily by a German professor, who looks upon our system as antiquated folly, as it would by an English orthodox professor. If it is true in one case it is true in every case. If it is true, as of course it is, that in the case of Belgium the exports of manufactured goods are largely paid for by the imports of raw material, it is equally true in the case of Spain, where the imports of manufactured goods are almost entirely paid for by the exports of raw material. But will any one pretend that that proves that the industrial condition of Spain is as good as the industrial condition of Belgium?

It is not a question whether imports are paid for by exports. Everybody admits that. The question is, What is the kind of imports and what is the kind of exports? Both those right hon. Gentlemen who have a good many ideas in common, said that the object of Tariff Reform was to diminish imports so as to increase employment. That shows how little they know about the object of Tariff Reform. They are entitled to say, if they choose, that that would be the effect of our proposals; but they are not entitled to say that that is our object. Our object is to increase both imports and exports. The question is, Is that object likely to be attained? The test is that of experience. What has happened in Germany? The fiscal system was altered in 1879. In the fiscal Blue Book to which I have referred, the total imports and exports of Germany and of the United Kingdom are given for twenty-five years since that period. What do they show? Taking an average of five years, the imports into the United Kingdom have increased to the extent of £175,000,000. The imports into Germany have increased to the extent of £227,000,000. But that is not the most remarkable thing in connection with these figures. It is the change in the character of the imports and exports of both countries. Taking the first period and comparing it with the second, if you take the United Kingdom you find this: That taking the imports first, the proportion of manufactured goods to our total imports has increased 5 per cent., and the proportion of raw material has, of course, diminished 5 per cent. Turn to the exports, and we find that the proportion of manufactured goods exported has diminished eight per cent., and the proportion of our raw material has increased eight per cent. Turn to Germany. What has happened in the same period? In their imports the proportion of manufactured articles has diminished to the extent of eight per cent., and in their exports the proportion of manufactured goods has increased five per cent. That is not the full extent. The whole object, both of German and all other tariffs, which really are directed against us—though not specially against us, are directed against us in effect—is to increase the imports of raw material and to diminish the imports of manufactured goods. This has been the effect in Germany. What reason is there to suppose that it will not be the effect with us? What we desire and what we believe will be the effect of Tariff Reform is to increase both the imports and the exports, but to change their character, because the larger and larger the degree in which our import consists of raw material to be worked up at home the larger and larger will be the proportion of our export consisting of manufactured articles to give employment to our own people.

Mr. RAMSAY MACDONALD

Will you allow me one moment, Mr. Speaker, just to put in a refutation of a statement which has been made. I was challenged to produce the name of a member of the Reich stag who is in favour of Free Trade—

Mr. BONAR LAW

That is not the challenge. The challenge was to produce proof that any member of the Reichstag, Socialist or other, had stated to his con-

stituents that he was in favour of unrestricted imports.

Mr. RAMSAY MACDONALD

I hold here in my hand a statement from my Friend [the name was lost in interruptions] who is a Member of the Reichstag. He said that the present policy of the Social Democrats includes free exchange and interchange of commodities.

Question put, "That those words be there added."

The House divided: Ayes, 254; Noes, 285.

Division No. 1.]	AYES.	[11.0 p.m.
Adam, Major William A.	Craig, Norman (Kent, Thanet)	Hohler, Gerald Fitzroy
Arbuthnot, Gerald A.	Craik, Sir Henry	Hope, Harry (Bute)
Archer-Shee, Major Martin	Cripps, Sir Charles Alfred	Hope, James Fitzalan (Sheffield)
Arkwright, John Stanhope	Croft, Henry Page	Horne, William E. (Surrey, Guildford)
Attenborough, Walter Annis	Dalrymple, Viscount	Horner, Andrew Long
Bagot, Colonel Josceline	Dalziel, Davison (Brixton)	Houston, Robert Paterson
Baird, John Lawrence	Dixon, Charles Harvey (Boston)	Hume-Williams, Wm. Ellis
Baker, Sir Randolt L. (Dorset, N.)	Douglas, Rt. Hon. A. Akers-	Hunter, Sir Chas. Rodk. (Bath)
Balcarres, Lord	Du Cros, A. (Tower Hamlets, Bow)	Jackson, Sir John (Devonport)
Baldwin, Stanley	Duke, Henry Edward	Jackson, John A. (Whitehaven)
Balfour, Rt. Hon. A. J. (City Lond.)	Duncannon, Viscount	Jardine, Ernest (Somerset. East)
Banbury, Sir Frederick George	Dunn, Sir W. H. (Southwark, W.)	Jessel, Captain Herbert M.
Banner, John S. Harmood-	Eyres-Monsell, Bolton M.	Kerr-Smiley, Peter Kerr
Baring, Captain Hon. Guy Victor	Faber, George D. (Clapham)	Kerry, Earl of
Barnston, Harry	Faber, Capt. W. V. (Hants, W.)	Keswick, William
Barrie, H. T. (Londonderry, N.)	Falle, Bertram Godfrey	Kimber, Sir Henry
Bathurst, Hon. Allen B. (Glouc. E.)	Fell, Arthur	King, Sir Henry Seymour (Hull)
Bathurst, Charles (Wilts, Wilton)	Fetherstonhaugh, Godfrey	Kinloch-Cooke, Sir Clement
Beach, Hon. Michael Hugh Hicks	Finlay, Sir Robert	Kirkwood, John H. M.
Beckett, Hon. William Gervase	Fisher, William Hayes	Knight, Capt. Eric Ayshford
Benn, Ion Hamilton (Greenwich)	Fitzroy, Hon. Edward A.	Knott, James
Bentinck, Lord H. Cavendish-	Flannery, Sir J. Fortescue	Law, Andrew Bonar (Dulwich)
Beresford, Lord Charles	Fleming, Valentine	Lawson, Hon. Harry
Bird, Alfred	Fletcher, John Samuel	Lee, Arthur Hamilton
Boyle, W. Lewis (Norfolk, Mid)	Forster, Henry William	Lewisham, viscount
Boyton, James	Foster, Harry S. (Lowestoft)	Llewelyn, Major Venables
Brackenbury, Henry Langton	Foster, John K. (Coventry)	Lloyd, George Ambrose
Brassey, H. L. C. (Northants, N.)	Foster, Philip S. (Warwick, S.W.)	Locker-Lampson, G. (Salisbury)
Brassey, Capt. R. (Oxon, Banbury)	Gardner, Ernest	Locker-Lampson, O. (Ramsay)
Bridgeman, William Clive	Gastrell, Major W. Houghton	Lockwood, Rt. Hon. Lt.-Col. A. R.
Brotherton, Edward Allen	Gibbs, George Abraham	Long, Rt. Hon. Walter
Brunskill, Gerald Fitzgibbon	Gilmour, Captain John	Lonsdale, John Brownlee
Bull, Sir William James	Goldman, Charles Sydney	Lyttelton, Rt. Hn. A. (S. Geo., Han. Sq.)
Burdett-Coutts, William	Goldsmith, Frank	Lyttelton, Hon. J. C. (Droitwich)
Burgoyne, Alan Hughes	Gooch, Henry Cubitt	MacCaw, Wm. J. MacGeagh
Butcher, John George (York)	Gordon, John	Mackinder, Halford J.
Putcher, S. H. (Cambridge University)	Grant, James Augustus	Macmaster, Donald
Calley, Col. Thomas C. P.	Greene, Walter Raymond	M'Arthur, Charles
Campbell, Rt. Hon. J. H. M.	Gretton, John	M'Calmont, Colonel James
Carlile, Edward Hildred	Griffiths, J. N. (Wednesbury)	Magnus, Sir Philip
Carson, Rt. Hon. Sir Edward H.	Guinness, Hon. Walter Edward	Mallaby-Deeley, H.
Castlercagh, Viscount	Gwynne, R. S. (Sussex, Eastbourne)	Mason, James F.
Cator, John	Haddock, George Baker	Meysey-Thompson, E. C.
Cautley, Henry Strother	Hall, D. B. (Isle of Wight)	Middlemore, John Throgmorton
Cave, George	Hall, M. (Liverpool, East Toxteth)	Mildmay, Francis Bingham
Cecil, Evelyn (Aston Manor)	Hambro, Angus Valdemar	Mills, Hon. Charles Thomas
Chaloner, Col. R. G. W.	Hamersley, A. St. George	Mitchell, William Foot
Chamberlain, Rt. Hon. J. A. (Worc'r.)	Hamilton, Lord C. J. (Kensington)	Moore, William
Chambers, J.	Hamilton, Marquess of (Londonderry)	Morpeth, Viscount
Chaplin, Rt. Hon. Henry	Hardy, Laurence (Kent, Ashford)	Morrison, Captain James A.
Clay, Captain, H. H. Spender	Harris, F. L. (Tower Hamlets, Stepney)	Morrison-Bell, Major A. C.
Clive, Percy Archer	Harris, H. P. (Paddington, S.)	Mount, W. A.
Coates, Major Edward F.	Harrison-Broadley, H. B.	Newdegate, F. A.
Colofax, Henry Arthur	Heath, Col. Arthur Howard	Newman, John R. P.
Collings, Rt. Hon. J. (Birmingham)	Heaton, John Henniker	Newton, Henry Kottingham
Compton, Lord Alwyne (Brentford)	Helmsley, Viscount	Nicholson, Wm. G. (Petersfield)
Cooper, Capt. Bryan R. (Dublin, S.)	Henderson, H. G. H. (Berkshire)	Nield, Herbert
Cooper, Richard Ashmole (Walsall)	Hermon-Hodge, Sir Robert T.	O'Neill, Hon. A. E. B. (Antrim, Mid.)
Corbett, T. L. (Down. North)	Hill, Sir Clement L. (Shrewsbury)	Orde-Powlett, Hon. W. G. A.
Courthope, George Loyd	Hillier, Dr. Alfred Peter	Ormsby-Gore, Hon. William
Craig, Charles Curtis (Antrim, S.)	Hills, John Walter (Durham)	Paget, Almeric Hugh
Craig, Captain James (Down, E.)	Hoare, Samuel John Gurney	Parker, Sir Gilbert (Gravesend)
Parkes, Ebenezer	Sanders, Robert Arthur	Verrall, George Henry
Peel, Capt. R. F. (Woodbridge)	Sanderson, Lancelot	Walker, Col. W. H. (Lancashire)
Peel, Hon. W. R. W. (Taunton)	Sandys, G. J. (Somerset, Wells)	Walrond, Hon. Lionel
Perkins, Walter Frank	Sandys, Lt.-Col. T. M. (Bootle)	Ward, A. S. (Herts, Watford)
Peto, B. E.	Sassoon, Sir Edward Albert	Warde, Col. C. E. (Kent, Mid)
Pollock, Ernest Murray	Scott, Sir S. (Marylebone, W.)	Wheler, Granville C. H.
Pretyman, Ernest George	Smith, F. E. (Liverpool, Walton)	White, Major G.D. (Land. Southport)
Proby, Col. Douglas James	Stanier, Beville	Williams, Col. R. (Dorset, W.)
Quilter, William Eley C.	Stanley, Hon. Arthur (Ormskirk)	Willoughby, Major Hon. Claude
Randles, Sir John Scurrah	Stanley, Hon. G. F. (Preston)	Willoughby de Eresby, Lord
Rankin, Sir James	Starkey, John Ralph	Wilson, A. Stanley (York, E.R.)
Ratcliff, Major R. F.	Staveley-Hill, Henry (Staffordshire)	Winterton, Earl
Rawlinson, John Frederick Peel	Steel-Maitland, A. D.	Wolff, Gustav Wilhelm
Rawson, Col. Richard H.	Stewart, Gershom (Ches. Wirral)	Wood, Hon. E. F. L. (Yorks, Ripon)
Remnant, James Farquharson	Stewart, Sir M'T. (Kirkcudbrightsh.)	Wood, John (Stalybridge)
Rice, Hon. Walter Fitz-Uryan	Storey, Samuel	Worthington-Evans, L. (Colchester)
Ridley, Samuel Forde	Strauss, Arthur	Wortley, Rt. Hon. C. B. Stuart
Roberts, S. (Sheffield, Ecclesall)	Sykes, Alan John	Wyndham, Rt. Hon. George
Rolleston, Sir John	Talbot, Lord Edmund	Yerburgh, Robert
Ronaldshay, Earl of	Terrell, George (Wilts, N.W.)	Younger, George (Ayr Burghs)
Rothschild, Lionel Nathan	Terrell, Henry (Gloucester)
Royds, Edmund	Thynne, Lord Alexander	TELLERS FOR THE AYES.—Sir A. Acland-Hood and Viscount Valentia.
Rutherford, William Watson	Tryon, Capt. George Clement
Samuel, Sir Henry (Norwood)	Tullibardine, Marquess of
NOES.
Abraham, William	Cowan, William Henry	Helme, Norval Watson
Addison, Dr. Christopher	Crawshay-Williams, Eliot	Hemmerde, Edward George
Adkins, W. Ryland D.	Crosfield, Arthur H.	Henderson, Arthur (Durham)
Agar-Robartes, Hon. T. C. R.	Crossley, William J.	Henderson, J. M. (Aberdeen, W.)
Agnew, George William	Dalziel, Sir James H. (Kirkcaldy)	Henry, Charles Solomon
Ainsworth, John Stirling	Davies, David (Montgomery Co.)	Herbert, Col. Sir Ivor (Mon. S.)
Alden, Percy	Davies, Ellis William (Eifion)	Higham, John Sharp
Allen, Charles Peter	Davies, Sir W. Howell (Bristol, S.)	Hindle, Frederick George
Anderson, Andrew Macbeth	Davies, M. Vaughan- (Cardigan)	Hobhouse, Rt. Hon. Charles E. H.
Armitage, Robert	Dawes, James Arthur	Hodge, John
Ashton, Thomas Gair	Denman, Hon. Richard Douglas	Holt, Richard Durning
Asquith, Rt. Hon. Herbert Henry	Dewar, Sir J. A. (Inverness-shire)	Hooper, Arthur George
Atherley-Jones, Llewellyn A.	Dickinson, W. H. (St. Pancras, N.)	Hope, John Deans (Fife, West)
Baker, Harold T. (Accrington)	Dilke, Rt. Hon. Sir Charles	Home, Charles Silvester (Ipswich)
Baker, Joseph Allen (Finsbury, E.)	Duncan, C. (Barrow-in-Furness)	Howard, Hon. Geoffrey
Balfour, Robert (Lanark)	Duncan, J. Hastings (York, Otley)	Hudson, Walter
Barclay, Sir Thomas	Dunn, A. Edward (Camborne)	Hughes, Spencer Leigh
Barnes, George N.	Edwards, Enoch	Illingworth, Percy H.
Barran, Sir John N. (Hawick B.)	Ellis, Rt. Hon. John Edward	Isaacs, Rufus Daniel
Barran, Rowland Hirst (Leeds, N.)	Elverston, Harold	Jardine, Sir John (Roxburghshire)
Barry, Redmond J. (Tyrone, N.)	Esslemont, George Birnie	Johnson, William
Barton, William	Evans, Sir S. T. (Glamorgan, M.)	Jones, Edgar R. (Merthyr Tydvil)
Beale, William Phipson	Falconer, James	Jones, Henry Haydn (Merioneth)
Bentham, George Jackson	Fenwick, Charles	Jones, William (Carnarvonshire)
Bethell, Sir John Henry	Ferens, Thomas Robinson	Jowett, Frederick William
Birrell, Rt. Hon. Augustine	Ferguson, Ronald C. Munro	Kemp, Sir George
Black, Arthur W.	France, Gerald Ashburner	King, Joseph (Somerset, N.)
Bowles, Thomas Gibson	Furness, Sir Christopher	Lambert, George
Brace, William	Gelder, Sir William Alfred	Layland-Barratt, Sir Francis
Brigg, Sir John	Gibson, James Puckering	Leach, Charles
Brocklehurst, William B.	Gill, Alfred Henry	Lehmann, Rudolf, C.
Brunner, John F. L.	Glanville, Harold James	Levy, Sir Maurice
Bryce, John Annan	Goddard, Sir Daniel Ford	Lewis, John Herbert
Burns, Rt. Hon. John	Greenwood, Granville George	Lincoln, Ignatius Timothy T.
Burt, Rt. Hon. Thomas	Greig, Colonel James William	Lloyd-George, Rt. Hon. David
Buxton, C. R. (Devon, Mid)	Grenfell, Cecil Alfred	Lough, Rt. Hon. Thomas
Buxton, Noel (Norfolk, North)	Grey, Rt. Hon. Sir Edward	Low, Sir Frederick (Norwich)
Buxton, Rt. Hon. S. C. (Poplar)	Griffith, Ellis Jones (Anglesey)	Luttrell, Hugh Fownes
Byles, William Pollard	Guest, Capt. Hon. Frederick E.	Macdonald, J. R. (Leicester)
Cameron, Robert	Gulland, John William	Macdonald, J. M. (Falkirk Burghs)
Carr-Gomm, H. W.	Haldane, Rt. Hon. Richard B.	Macnamara, Dr. Thomas J.
Cawley, Sir Frederick (Prestwich)	Hall, F. (Yorks, Normanton)	M'Callum, John M.
Cawley, H. T. (Lancs., Heywood)	Hancock, John George	M'Curdy, Charles Albert
Chancellor, Henry George	Harcourt, Rt. Hon. L. (Rossendale)	M'Kenna, Rt. Hon. Reginald
Chapple, Dr. William Allen	Harcourt, Robert V. (Montrose)	M'Laren, Rt. Hon. Sir C. B. (Leices.)
Churchill, Rt. Hon. Winston S.	Hardle, J. Keir (Merthyr Tydvil)	M'Laren, F. W. S. (Line, Spalding)
Cleland, James William	Harvey, A. G. C. (Rochdale)	Mallet, Charles Edward
Clough, William	Harvey, T. E. (Leeds, West)	Manfield, Harry
Collins, Godfrey P. (Greenock)	Harvey, W. E. (Derbyshire, N.E.)	Marks, George Croydon
Collins, Stephen (Lambeth)	Harwood, George	Martin, Joseph
Collins, Sir Wm. J. (St. Pancras, W.)	Haslam, James (Derbyshire)	Masterman, C. F. G.
Compton-Rickett, Sir J.	Haslam, Lewis (Monmouth)	Menzies, Sir Walter
Corbett, A. Cameron (Glasgow)	Havelock-Allan, Sir Henry	Middlebrook, William
Cornwall, Sir Edwin A.	Haworth, Arthur A.	Millar, James Duncan
Cory, Sir Clifford John	Hayward, Evan	Molteno, Percy Alport

Mond, Alfred Moritz	Robertson, Sir G. Scott (Bradford)	Walker, H. de R. (Leicester)
Montagu, Hon. E. S.	Robertson, John M. (Tyneside)	Walsh, Stephen
Morgan, G. Hay (Cornwall)	Robinson, Sidney	Walters, John Tudor
Morgan, J. Lloyd (Carmarthen)	Robson, Sir William Snowdon	Walton, Joseph
Morton, Alpheus Cleophas	Roch, Walter F. (Pembroke)	Ward, John (Stoke-upon-Trent)
Munro, Robert	Roe, Sir Thomas	Ward, W. Dudley (Southampton)
Murray, Capt. Hon. Arthur C.	Rowntree, Arnold	Wardle, George J.
Muspratt, Max	Runciman, Rt. Hon. Walter	Waring, Walter
Neilson, Francis	Samuel, Rt. Hon. H. L. (Cleveland)	Warner, Thomas Courtenay T.
Norton, Capt. Cecil W. (Newington)	Samuel, J. (Stockton-on-Tees)	Wason, Rt. Hon. E. (Clackmannan)
Nussey, Sir T. Willans	Samuel, S. M (Whitechaper)	Wason, John Cathcart (Orkney)
Nuttall, Harry	Schwann, Sir Charles E.	Waterlow, David Sydney
Ogden, Fred	Seddon, James A.	Watt, Henry A.
O'Grady, James	Shackleton, David James	White, Sir George (Norfolk)
Palmer, Godfrey Mark	Shaw, Sir Charles Edward	White, J. Dundas (Dumbartonshire)
Parker, James (Halifax)	Sherwell, Arthur James	White, Sir Luke (Yorks, E.R.)
Pearce, William	Simon, John Alisebrook	Whitehouse, John Howard
Pearson, Weetman H. M.	Smith, H. B. Lees (Northampton)	Whitley, John Henry (Halifax)
Philipps, Col. Ivor (Southampton)	Snowden, Philip	Whittaker, Rt. Hon. Sir Thomas P.
Philipps, Sir O. C. (Pembroke)	Spicer, Sir Albert	Whyte, Alexander F. (Perth)
Pickersgill, Edward Hare	Stanley, Albert (Staffs, N.W.)	Wiles, Thomas
Pirie, Duncan V.	Strachey, Sir Edward	Wilkie, Alexander
Pointer, Joseph	Summers, James Woolley	Williams, Aneurin (Plymouth)
Pollard, Sir George H.	Sutherland, John E.	Williams, John (Glamorgan)
Ponsonby, Arthur A. W. H.	Sutton, John E.	Williams, Penry (Middlesbrough)
Price, C. E. (Edinburgh, Central)	Taylor, John W. (Durham)	Williams, W. L. (Carmarthen)
Price, Sir Robert J. (Norfolk, E.)	Taylor, Theodore C. (Radcliffe)	Wilson, Hon. G. G. (Hull, W.)
Priestley, Arthur (Grantham)	Tennant, Harold John	Wilson, Henry J. (York, W.R.)
Priestley, Sir W. E. B. (Bradford, E.)	Thomas, Abel (Carmarthen, E.)	Wilson, John (Durham, Mid)
Primrose, Hon. Neil James	Thomas, Sir A. (Glamorgan, E.)	Wilson, J. W. (Worcestershire, N.)
Pringie, William M. R.	Thomas, David Alfred (Cardiff)	Wilson, T. F. (Lanark, N.E.)
Radford, George Heynes	Thomas, James Henry (Derby)	Wilson, W. T. (Westhoughton)
Raffan, Peter Wilson	Thorne, G. R. (Wolverhampton)	Winfrey, R.
Rainy, Adam Rolland	Thorne, William (West Ham)	Wing, Thomas Henry
Rea, Walter Russell	Tomkinson, James	Wood, T. M'Kinnon (Glasgow)
Rees, John David	Toulmin, George	Young, William (Perth, East)
Kendall, Athelstan	Trevelyan, Charles Philips	Younger, W. (Peebles and Selkirk)
Richards, Thomas	Twist, Henry	Yoxall, Sir James Henry
Roberts, Charles H. (Lincoln)	Ure, Rt. Hon. Alexander
Roberts, George H. (Norwich)	Verney, Frederick William	TELLERS FOR THE NOES.—The Master of Elibank and Mr. Fuller.
Roberts, Sir J. H. (Denbighs.)	Vivian, Henry

And it being after Eleven o'clock and objection being taken to farther proceeding, the Debate stood adjourned.

Debate to be resumed to-morrow (Friday).

Adjourned at Fourteen minutes after Eleven o'clock.