HC Deb 08 February 1911 vol 21 cc293-398

I beg to move as an Amendment to add at the end of the Address:— This House humbly expresses its regret that the persistent refusal of your Majesty's Government to modify the Fiscal system of the country is imperilling the advantages at present derived by British commerce from the Preference granted by your Majesty's Dominions overseas; has deferred the closer commercial union of the Empire; and has deprived the country of the most effective method of inducing foreign countries to grant fair treatment to British manufacturers. The House will recognise that in rising to move the Motion which I have the honour to submit to it, on behalf of my colleagues and myself, I have a task of peculiar difficulty and delicacy. The Fiscal question covers multifarious issues, and we have from time to time laid different portions of the subject before the House. It is impossible in one speech, it is difficult in one amendment, to cover the whole ground, and I hope it will not be thought or alleged against me that if my Amendment is in some respects limited, I have abated a jot or tittle of the full programme of financial reform for which I have several times spoken in this House. Limited as it is, my Amendment still deals with questions of vast importance and of peculiar delicacy and difficulty, as must always be the case when this House has to consider matters in which they are not the prime movers—resolutions in which they have not the decisive voice and a policy which, whatever its effects upon the Mother Country or the Empire as a whole, is primarily the policy of one of the great Dominions and not the policy of the United Kingdom. I hope that in anything I may say to-day no words will escape me that can give rise to any misconception as to our attitude towards the great Dominion of Canada or the great friendly Republic of the United States. Nothing is farther from my thoughts than to criticise the action of their respective Governments, nothing is more removed from my purpose than to tender advice to Canadian citizens as to how they should act in a great national, even though it be also a great Imperial question. But I cannot conceal from myself that the subject which will be uppermost in the minds of all as we approach the consideration of this Amendment is the agreement which has been provisionally signed between the Governments of Canada and the United States, and it would be idle to suggest for a moment that in moving the Amendment I do not find an additional reason for the course which we have taken in recent proceedings between those two countries. Of course, they must settle their own affairs.

For the moment we are spectators, and spectators only. No man in this House or out of it—no man in the United Kingdom desires to impinge upon the liberties of any of our great Dominions. We rejoice in their growth, we welcome every addition to their potency and influence. We hail with satisfaction everything which can be for the further development of their great resources and which can add to the strength and splendour of their nation, and indeed it has been the moving idea of all of us who have supported the policy of Tariff Reform that in that policy and by its means, we have found, not merely a method of bringing closer together the scattered portions of the Empire, but the surest means and the earliest way of developing to their fullest capacity the national strength of each of the great component parts of our Dominions. Far be it from me to criticise the action, much more to criticise the motives of Canadian statesmen. On the contrary, in the Fiscal policy which I and my friends advocate, we find ourselves in far greater communion of spirit with Canadian Ministers than we do with right hon. Gentlemen opposite, and our complaint—if complaint there is to be, as complaint there must be—is not of the action of the Dominion Ministers, but of the action, or rather inaction, of His Majesty's Government. I not only eschew all critcism on Canadian Ministers, but I am proud to rank myself in this question of Imperial Trade Policy as their disciple and follower. They were the first among the earlier exponents and the first to practise that policy of Imperial preference, to which my friends and myself stand committed for which we have fought, and will fight, in good times or in bad, in good repute or ill-repute. until we bring it to a triumphant conclusion.

My amendment contains three proposals (1) "The persistent refusal of your Majesty's Government to modify the Fiscal system of the country is imperilling the advantages at present derived by British commerce from the Preference granted by your Majesty's Dominions overseas; (2) has deferred the closer commercial union of the Empire; and (3) has deprived the country of the most effective method of inducing foreign countries to grant fair treatment to British manufacturers."

May I say a few words in the first place upon the last proposition, and here, at any rate, I can make an observation in which I think all can heartily agree, and which cannot but be acceptable to Canadians of any shade of opinion. Could you have a more signal instance of the value of commercial negotiations under a Tariff system than you have in the agreement provisionally signed between Canada and the United States? For years in the infancy of their development, it was the entreaty and the constant effort of Canadians to secure fair reciprocal treatment from their great neighbour across their southern frontier.

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Their efforts were repulsed until they at last decided that they would so alter their system that, independently of any external power, they would build up a great national industry of their own, that they might secure their full and free national development, not for this or that single line, but on all lines on which national life can grow and prosper, and it was not until that policy had been practised with such success that the Prime Minister declared there would be no more pilgrimages to Washington, that the pilgrimage set out in the other direction, and that which had been refused to Canada when defenceless and weak is now offered and pressed on her because of the advantages she has derived from her protective system, and because of the growth of her resources which she has won under and through that system.

That is not the only change in the commercial tariffs of the nations which is taking place at the present time. Japan has passed a new tariff and has given notice to terminate the former commercial treaty with this country, and our traders are not unnaturally extremely anxious as to the results which may befall British trade from the very heavy increases which are proposed in the new tariff of Japan. I understand the President of the Board of Trade is going to answer. I shall be grateful if he can give us a little more information upon the subject. We saw it reported that, I think about a year ago, Count Kamura had said that in mitigation of the general tariffs of Japan there would be conventional arrangements made on a reciprocal basis with other countries. It was further reported that he had said that owing to our special system we had not any special advantages to offer to Japan, and that therefore we could not share in those benefits. I hope that was a mis-report. I noticed with pleasure that the Foreign Secretary, receiving a deputation, said that there was certainly nothing in the action of the Japanese to confirm its accuracy, and that the Government had no confirmation of it. But what is our position? Does it not stand to reason that the Power which has given up all that it had to make a bargain stands to lose more and to gain less than the Power which keeps its full resources in negotiation in its own hands, and says, "in proportion as you treat me fairly I will treat you fairly"? It is an old story, but it is one which cannot be sufficiently insisted on, that, as the late Lord Salisbury, with his unrivalled experience of foreign affairs and of such negotiations, pointed out, those who go empty to market are apt to come empty away. When you have nothing to give you cannot expect to receive. Tariff negotiations are a matter of bargain, and as long as we have stripped ourselves of power before we go into the negotiations, and as long as it is understood by everyone that, however unfruitful the negotiations are for us, we shall never think of retaliation so long we shall cease to gain for our own traders and our own people the advantage which our vast trade and our important commercial position ought to secure to us first of all nations in the world.

Can the right hon. Gentleman tell us anything of the progress of these negotiations? The representatives of the Government said the other day that they were hopeful about them. How far are they hopeful? Do they think they are going to retain for British exporters and manufacturers and for British trade the old rates of duty, or is their utmost hope that, thanks to the goodwill of the Japanese Government and to our most friendly relations of alliance with them, they may get some slight abatement off the new duties, which are raised in some cases as much, I think, as 100 per cent.? The question is of some importance. The Board of Trade not so very long ago bragged of its great success in the Roumanian Treaty, hut after all its success the trade of this country was much worse off than it was under the old Treaty arrangement, and the full measure of its success was not to secure for us such right of entry as we had before, but slightly to mitigate the exclusion which the original duties proposed would have inflicted upon us. In these two cases we see the deficiency of our present system as a defence against the exclusion of our trade. I have already alluded to the deputation which waited upon the Secretary for Foreign Affairs on the subject. It was a very influential and important deputation, and was received by the Secretary of State as such. But how singular it is that the deputation should have thought it worth while to call upon the Secretary of State or that the Secretary of State should not have once pointed out to them that they were merely wasting their time. What is the Free Trade argument? Duties are borne by the consumer. What does it matter to our manufacturer if Japan raises its duties 100 per cent.? The Secretary of State is a Free Trader. Why did he not tell the deputation that it was not his business to protect the Japanese consumers? His business was only to look after British interests, and British interests were not concerned, as the Japanese would have to pay the duties and the British manufacturers could raise their prices at their own sweet will. It is curious how the Free Trade theory breaks down the moment you come to examine it.

I pass to the other clauses of my indictment, that the inaction of the Government imperils the advantages we have hitherto derived from Colonial Preference and delays the commercial union of our Empire, and I am bound at this point not to criticise but to examine the agreement which has been provisionally signed between the Dominion of Canada and the United States. I do not want the House to criticise it. That is not our duty. But I want the House and the representatives of this great commercial community, as representatives of the United Kingdom and as citizens of the Empire, to try and get a clear idea what this agreement means for all the interests which are in our charge, and to see how it affects the policy of our country, and the lessons which we ought to draw from it. The agreement itself is a very wide one, even as it stands, as between the Dominion and the United States. But the tariff system of the Dominion is a treaty system. They have at present treaties with some twenty different nations. Every one of those treaties contains a most-favoured nation clause, and accordingly, under the British interpretation, which is also the Canadian interpretation, and if I understand rightly, was so accepted by Mr. Fielding in his speech the other day, every one of those twenty nations must enjoy the same rates of duties as are now open to the United States. The agreement is, therefore, one directly affecting, not merely the treaty conditions between the United States and Canada, but between Canada and some twenty other nations as well.

Whilst that is the British and Canadian interpretation of the most favoured nation clause, it is not the United States interpretation. We hold ourselves precluded under the most favoured nation clause from making specially favoured arrangements with any other foreign nation. The United States holds itself at liberty, in spite of that clause, and contends that it is no breach of that clause to make special arrangements with any Power, and not to share the advantages with any other Power with which they have treaties. It is rather a lop-sided agreement as between the British Empire and the United States of America, and one question I should like to ask the President of the Board of Trade is, what steps under these circumstances, the Government are taking to protect British trade with the United States of America. Are the Government making any representations to secure for British manufacturers and British exporters the same favoured rates of duties which are now to be given to British manufacturers and exporters in Canada, or are we to have an arrangement between one of the great dominions of the Crown and the United States which is not shared with other portions of the Empire, and more favourable to the Dominion than to the Mother land or to any other portion? Take a couple of individual illustrations. Take cutlery as an illustration. Cutlery entering the United States at present is charged with about 40 per cent. duty. Cutlery entering from Canada will be reduced by the agreement to 27½ per cent. Is the Government taking any steps to secure for our manufacturers equal advantages with those which the United States offers to Canadian manufacturers? An exactly similar case arises in regard to motor-cars. The present United States duty is 45 per cent. It is to be reduced to 30 per cent. in the case of Canadian cars. Are the Government taking any steps, and if so can they tell us with what prospect of success, to secure for our manufacturers the same right of entry into the United States market which Canadian Ministers are securing for Canadian manufacturers? I hope the President of the Board of Trade will deal with the point.

For my part, I have to confess that as it stands I cannot but feel that this agreement has, and must have, the most far-reaching effects, not in the Dominion of Canada alone, but on the Empire at large, and in particular on the relations which have prevailed in the past between the Dominion and the United Kingdom. An agreement which gives the Canadian in the American market better terms than are accorded to our own manufacturers, which brings them into these close ties of business with the United States, far closer than our own, takes the Dominion of Canada out of the Imperial orbit, and draws her into the vortex of Continental politics and Continental interests. It touches our interests in other and more direct ways. It must mean a great diver-lion of trade in corn. Wheat, for which we have been the preferred market hitherto, which has travelled eastward over the vast railway and lake system of Canada to come to our markets and afford bountiful supplies to our food, will now be drawn southward across the American frontier.

What is going to be the result of this? In the first place it will hasten and increase the process which has already begun in the United States of throwing land out of wheat cultivation and into other forms of cultivation. As Canadian wheat finds its way into America, less and less American land will be put under corn. Maize and other crops will take their place, and the American drain of Canadian supplies will yearly become greater. What is going to be the result upon us? What is going to be the result, in the first place, upon our consumers? Their food will cost them more. The men who have been told almost in one breath by hon. Gentlemen opposite that if we had Preference our farmers would be ruined by Canadian competition, and that if we had Preference the millions in our towns would be starved for want of bread, are now coming to find that for want of that Preference the supplies which they might have had, and of which they had the first call and the first offer, are turned from our shores, and in increasing quantities are taken to be consumed by the people of the United States. And the trucks which carry corn southward will not run northward empty. [HON. MEMBERS: "Hear, hear."] Listen to the cheers of hon. Members. Do they know what they are cheering? I say that the trucks which carry wheat southward will not run back empty. They will carry back American manufactures in competition with our own, and by the new trade route which will be created by this agreement you do much to separate the west of Canada from the British market, to separate British producers from the markets of Western Canada, and to subsidise American competitors in fighting against us. I ask, does it not stand to reason that it will be worked in the interest of the American railway interest along this new route in order to do everything to stimulate the return trade. Do you not know that preference can be given as easily through railway rates as through a tariff system? Do you not see that you force a preference to be given for American manufactures in competition with our own in order that the railways may get the return trade and not have their trucks coming back empty? I confess I could have understood hon. Gentlemen saying that these were great disadvantages, but that they must be put up with, because of the triumph of the abstract doctrine of Free Trade. (Cheers.) I think that the hon. Gentlemen who cheer do not quite realise what that means. They seem to rejoice in the additional struggle put upon our own people with respect to the markets for their labour and the sale of their produce, and that is a thing I never expected to live to see. The wheat supply is going to be restricted, prices are going to be raised, because you did not take the offer which was open to you, and that which you refused is now eagerly sought by foreign nations.

But that is not all. We shall be affected in another way. I do not know whether hon. Members read a very a very interesting article which appeared in "The Times" on Monday last upon the effects of this agreement upon English agriculture. It is going to give an enormous stimulus to stock-raising in America. It is going to throw the meat trade more and more into the hands of great American combinations. It is going to place our own producers of meat still further at the mercy of foreign trusts and foreign combinations. It is going to give and must give an enormous stimulus to the manufacturing and producing power of America, not merely because of the more favourable terms on which they secure entry to the great Dominion market, but because of the more favourable position in which they are placed to secure and to use the vast natural resources of the Dominion of Canada. The cumulative effect of these different changes must, in my opinion, be most serious for the trade of this country, and I do not see how it is possible for us to dissociate ourselves from all interest in the agreement now being discussed in Canada, though we must leave to the Canadians the responsibility and the right to settle their own policy without any interference from us. We must face the result of the situation. We must understand what it involves for us, and we must see whether, threatened with so great a loss, we cannot yet do something to restore the balance and keep the trade which a little time ago was offered so freely to us.

One further observation I must make upon the direct effect of the agreement upon us. The preference which we enjoy in the Canadian market is sensibly diminished by this agreement It is obvious that where hitherto there have been duties against American produce, and where there are now to be no duties, the ground or opportunity for preference to British produce goes; and, on the other hand, where articles are not free on entering Canada and the American duties are reduced, there will accordingly be a reduction in the margin of preference to us. I desire to acknowledge and to recognise in the fullest possible manner the desire of Canadian Ministers to preserve as much preference as they can compatibly with their agreement. I am glad to see, and I have never doubted that it would be so, that they intend in no case the duties on American produce to be less than the duties on our produce. They desire also, what I am sorry to say hon. Gentlemen opposite do not desire, that wherever possible there should still he a preference to British produce, and they mean to keep it so. I heartily recognise and gratefully acknowledge the spirit in which Sir Wilfrid Laurier, Mr. Fielding, and their colleagues have treated this matter, and I note that they, at any rate, do not shout with hon. Gentlemen opposite that this agreement is the end of Preference and of commercial union of the Empire. On the contrary, they still desire to maintain it. They are maintaining it wherever possible, and they are still willing to go further and give us larger Preference whenever we are prepared to take the first step, which Sir Wilfrid Laurier said was ours now many years ago—to take the first step in creating on our side a mutual preference for Canadian goods in our market. But in the meantime, in spite of the desire of the Canadian Government to preserve Preference wherever possible, no one can examine this agreement without seeing that in some cases Preference is going to disappear, and that in other cases the margin will be greatly reduced. There is, in fact, a great change in the policy of Canada. Her policy for a generation has been a policy of international development, free from Continental influences and directed, as far as our Ministers could direct it, not merely to the growth of Canada as a nation, but to the greatness and union of the Empire of which Canada is a most distinguished portion. For that purpose they sought, wherever they could, to put us in a position of Preference. Now they seek that we, at any rate, shall not be in a position of disadvantage, but through our hesitation, through the persistent refusal of the Government to recognise facts or reciprocate the policy of the Canadian Government, the margin of advantage which we have had is diminished, and by every treaty Canada makes is still further decreasing. The French treaty made a hole in it, the German arrangement made another, and the American treaty makes a still bigger hole, and the advantages of these treaties are spread over twenty other nations in Europe. It is a profound change of policy in Canada. It is a profound change in our own position, the moral of which we had better draw quickly if we want to avert, so far as may be, its evil consequences to ourselves.

What has been, not for a generation only, but for fifty years and more the policy of Canada? It has been a policy of preferential trade with this country. In the heyday of the adoption of Free Trade in this country, Canada asked for preference on the shilling duty on corn. She sought, year after year, the abolition of the treaties with Belgium and the Zollverein, which tied our hands against Preference, and at last, thanks to the late Lord Salisbury, she secured the denunciation of these treaties and established Preference with the United Kingdom.

At conference after conference the representatives of Canada and of the other dominions have offered us reciprocal advantages, have pressed upon us the strength that they might give to the Empire as a whole, and the development which they might bring to each part of the Empire. We were told by a Liberal statesman that the United States could not enter into any such agreements, that they were sordid bargains which could bring nothing but discontent or disunion. Is that what is said to the Canadians—that any reciprocal arrangement between the United Kingdom and a sister State would have been a sordid bargain, breeding only discontent, but that it becomes a great triumph of civilisation and international friendship the moment it is contracted between Canada and the United States, and the United Kingdom is excluded from it? I think hon. Gentlemen opposite must revise some of their arguments. What is the defence of the Government for having done nothing? What is their defence for having allowed us to drift into the situation with which we are now confronted? I take it from the Prime Minister, who said the other night that he would make only two observations on this subject. "First," he says, "we should have done nothing to prevent the natural trend of events, and much that would have been fatally injurious to our own country if we had taxed foreign corn."' They could have done nothing to prevent the natural trend of events! Is that so? The Secretary of State for India (Lord Crewe), in another place, put the same defence, in slightly different words. "Lord Lansdowne," he said, "spoke of the agreement as having come about because Canada knocked in vain at our door; I wonder if that is an observation which could be maintained by historical evidence?" The contention of the Government is, in brief," nothing we could have done would have prevented this agreement being made." There is an even higher authority on that subject, and that is the Prime Minister of Canada. Instead of the Prime Minister of this country after the event let us have the Prime Minister of Canada speaking before the event. Speaking in the Canadian House of Commons, on the 22nd November, last year, Sir Wilfrid Laurier said: If the result of the British elections would prove to be a victory for Tariff Reform there would be little prospect of any large measure in favour of a reciprocal lowering of tariffs with the United States. There is the historical evidence, and from the best and most authoritative source, for which Lord Crewe asks. There is the answer to the Prime Minister. If His Majesty's Government had been willing to make a reciprocal agreement, Canada would not have sought a reciprocal agreement with America. If we had accepted the offers that were open to us she would have continued the policy of national development on East and West lines, and she would not have turned Continental development along the lines of North and South. Let me repeat that if we had so strengthened the lines of trade East and West we should have done more to protect the food supplies of our people than by the simple maintenance of an attitude of indifference and inaction in face of these great changes. For not only will the United States absorb much of the food supplies that we might have attracted to our market, but we, in our turn, shall be thrown more and more upon foreign supplies grown outside the Empire, in countries happily friendly with the Empire now, but not always to be counted upon as the loyalty of fellow subjects in other great Dominions is to be counted on. And, in passing, let me say that the supplies of the particular classes of wheat that are required must come very largely from Russia. Have you drawn the attention of your Board of Admiralty to the obviously increasing importance of our commercial routes to Russia if this agreement goes through? I fancy they would tell you that they would sooner protect your food ships coming across the Atlantic to our shores than protect your food ships treading their way down the Baltic or coming from the Black Sea under the provisions of the Declaration of London. So much for the first of the Prime Minister's observations. I come to the second. His second was prophecy. In speaking of an event which had passed, and which we can bring to the test of fact, the House will have observed that he was not very successful. He took up the line that nothing we could have done could have prevented this. Sir Wilfrid Laurier said that if we had been ready to make a reciprocal arrangement, there was not much likelihood of a reciprocal deal with the United States.

Now we come to the future where the Prime Minister is in the region of prophecy. "It is as certain," he said, "as the rising of the sun, that, as time went on, sooner or later the people of the United States would have been bound to bring down the tariff walls which separated them from countries close to their own borders." Is that certain? It is not what occurred. The United States did not go to Canada and say, "We are going to throw down our tariff walls because we must have your supplies of corn and your raw material, and this or that of your manufactured articles." They went to Canada and said, "If you will admit our goods on more favourable terms we will admit your goods on more favourable terms." It is not what did occur. It might have been years before it had occurred; it might not have occurred at all. And does the right hon. Gentleman suppose that time is not of the first importance in matters of this kind? Trade is no doubt fluid, and trade can be shifted. But an old-established trade, buttressed by great ways of communication which have developed great interests or lead to certain terminal points along certain lines, can resist for a long time and can resist for ever the contrary forces of geographical propinquity or natural circumstances. Test it by our own experience. Does anybody suppose that trade does not now come to some of our great ports, not because these are the spots which, if you had to start afresh, you would choose as the best points in this country for that trade, but because these old lines of trade tend to keep trade in the same places? With every cargo that comes the route is ploughed deeper and it becomes increasingly difficult to remove the trade out of it. If it were true that the United States would have had to throw down its barriers it was not true at this moment, and even if it were true in years to come it would have been everything for the fortunes of our traders and the interests of our commercial men that as long a period of time as possible should have intervened before that occurred in which to plough deeply and profoundly the routes of trade between ourselves and the Dominion. The right hon. Gentleman went on to say that this agreement was merely the result of the inevitable tendency of irresistible economic forces which could not be neutralised or counteracted by any artificial agreement. I think the right hon. Gentleman has become so much the instrument of inevitable tendencies and irresistible forces exterior to himself, and even to the party with which he is immediately associated——


The electors of this country.


That he loses sight of what can be done by men of courage and resolution, who do not tell us that things are irresistible and forces are inevitable, and that he lends himself a ready victim to them. The building up of great States is not the result of natural forces or geographical circumstances. No, it is not. I challenge the Prime Minister. I perhaps put the phrase wrongly. The Prime Minister challenges me.


I challenge what you said, not what you meant.


The building up of great States has not been, and is not the result of geographical forces or of natural conditions. The greatest States have been built up in spite of vast natural difficulties by the persistent courage, resolution and initiative of Statesmen. Does the Prime Minister think that the United States are the creation of natural forces? Does he think that the Dominion of Canada is the creation of natural forces? If natural forces, as Sir Wilfrid Laurier has himself said, had been left to work there never would have been any national life in Canada: there never would have been any Dominion of Canada such as we are proud to recognise to-day, and they never could have negotiated on equal terms with the United States. They would have been swamped and absorbed in the power and influence of their mightier neighbour. Look at Europe. Is the German Empire the result of natural forces or geographical boundaries? It is the result of tariff arrangements. It is the result of the Zollverein weaving all kinds of interest so close and so profound that even in the midst of the war of 1866, even between warring States, these obligations were still recognised; and whilst the war was actually in progress accounts were kept on one side and the other of what would be due under these tariff arrangements on the return of peace. Could you have a more striking instance of the unifying power of a common commercial policy and common fiscal interest? Is it right that we, by our own laxity, by our want of readiness to respond to Colonial offers, should allow these reciprocal ties to grow up between the Dominion and strangers, while there are no such reciprocal ties between the Dominion and our- selves. I say a heavy responsibility rests upon His Majesty's Government for the inaction of the last few years, and they are relieved of none by the appeal made by the Prime Minister to the opinion of our countrymen. Who misled that opinion? Who on every occasion, excepting at the Colonial Conference itself, has belittled the advantages of our Colonial trade, has slighted advantages already conferred upon us by Preference, who has tried by every possible appeal to passion, ignorance, or greed, by every stimulant to private interest as opposed to national welfare, to discredit the adoption of a common commercial policy such as might have bound us by far closer ties—close as these ties may be—to Canada, which will now be drawn to America by bonds which might have been saved for our people, and for the mutual development of the different portions of the British Empire? These vast resources will now go to build up influence and power of a foreign State. But what is to be said of our policy at this time? Are we, because by our delay we have lost much, to lose more? That is not the course which I commend to the House. I have already noted that, unlike Ministers here and their followers, who rejoice in this agreement just because it does diminish Preference and lessen the ties, the commercial ties between the Dominion and ourselves, it is the avowed desire of Canadian Ministers still to make those ties as close as possible, still whenever they can, to preserve the Imperial Preference, and that they are still as ready now as they have been at any time for the last ten years and more, to enter into mutual and reciprocal relations by which both portions of the King's Dominions may be strengthened, and the common interests of both be bound closer together. If I have thought that in the lasting interests of our nation, in the interests of our Empire, in the individual interest of each of our Great Dominions, this policy was necessary and urgent during the last few years, I am here to-day to say that in my opinion the ratification of this agreement, if ratified it be, only makes it more urgently necessary that we should come to terms with the other Dominions before they are all beset by foreign suitors, and that in the case of Canada we should so alter our policy that we may do everything that can be done by statesmanship and financial wisdom to counterbalance the new strain which draws to the south, and make stronger and mightier and ever more profound the ties which unite Canadians to the Motherland, of which they are the greatest offspring.

The PRESIDENT of the BOARD OF TRADE (Mr. Buxton)

May I be allowed first to congratulate the right hon. Gentleman on his presence here this afternoon, and I am very glad that he is here to take part in the discussion of matters in regard to which he has had a successful career. With reference to the last part of his speech, where he talked of the Tariff revolution, I suggest that he should look at home, there is plenty to be done. Where is their courage and resolution? What is the history of the right hon. Gentleman and his party in regard to the matter of a tax on corn? We do not call it Preference, we call it a tax on corn. What is the history of the hon. Gentlemen opposite with regard to that? Have they shown courage in regard to that tax? What happened? They put the duty on one year and took it off the next, and, having taken it off, they thought they would put it on again. When they talk about courage and resolution, we have only to look to the right hon. Gentleman the Leader of the Opposition, who at all events has had various stages in regard to this matter, and has been subjected to constant pressure, which it has been necessary to put upon him to bring him up to the measure of Preference at all. As far as we are concerned on this side of the House we do not share the apprehension of the right hon. Gentleman with regard to this agreement, and certainly do not agree that his remedy of a 2s. tax on corn is going to get rid of all these evils, if evils there are. The right hon. Gentleman has set out to prove two things. In the first place great damage will be done to inter-Colonial trade and the Empire trade of this country by the agreement. Secondly, that the imposition of this Preference would avert that damage.

What authority has he for saying either that our trade is likely to be damaged, or what authority has he for saying that if his proposal had been accepted it would have saved our trade and prevented this agreement between the United States and Canada from taking place. I think if hon. Members read this morning's papers containing a communication from Mr. Fielding, the Minister of Canada, who is responsible for this agreement, they will see that he answers almost all the serious arguments the right hon. Gentleman has advanced. What does Mr. Fielding say in his communication. The right hon. Gentleman said that it was a new policy, a new suggestion between Canada and America. Mr. Fielding says:— Reciprocal trade relations with the United States have been the policy of all parties in Canada for generations. The right hon. Gentleman says that this agreement will be against the interests of this country and Canada. What does Mr. Fielding say?— In making such an arrangement as is now proposed we are realising the desires of our people for half it century, and also that in promoting friendly relations with the neighbouring republic we are doing the best possible service to the Empire. Would it not be ridiculous, in pursuit of such a policy, to refuse to avail herself of the markets of a great nation lying alongside? 5.0 P.M.

The right hon. Gentleman seemed to think, or he talked of our being responsible for the present position. Does he think we are going to stand here in a white sheet, with a candle, to confess our sins, plead for absolution, and be shriven by him? That is not at all our position. As far as we are concerned we are unrepentant; we have neither changed nor modified our view with reference to the proposal of the right hon. Gentleman. We have entertained the view throughout that his proposal would be injurious to this country and to the Empire as a whole. The right hon. Gentleman said perfectly truly that this matter was a very delicate one. It may be very difficult to say much about it without possibly being misunderstood on the other side of the Atlantic as saying something either for or against the agreement. The Leader of the Opposition, a few nights ago, and it was repeated by the right hon. Gentleman, said it was not our business here to state our views in regard to the merits of the matter as affecting Canada. I am quite sure that the last thing any hon. Member on either side of the House would desire would be that the fiscal matters of Canada should be made the shuttlecock between parties in this House in connection with our local and political disputes. It is a matter on which we can congratulate ourselves that the Canadians have a free hand in these negotiations and were able to come to terms with the United States quite apart from the question of our position in this matter. I take the opposite view with regard to this matter to that of the right hon. Gentleman. This very agreement is a very good object lesson in showing the evils and dangers of the fiscal relations which the right hon. Gentleman proposes to set up between us and the Colonies. If we had his Preference in force Canada would have had on this agreement to consult us in reference to it. We should have had various local interests in Canada arrayed against one another, as they are now, but antagonistic to our interests, so that instead of being an additional link to the chain of Empire, very likely Preference might have brought the chain to snapping point. Therefore, in what I say, I must not be held to be making any special reference to such an agreement as the right hon. Gentleman discussed at some length. The right hon. Gentleman said we were glad that Preference has got a setback, or an alleged setback. That is not our position. We recognise, I think, as much as the right hon. Gentleman, the advantages which we in this country receive from the preference which Canada has been good enough to give us with regard to the importation of British manufactures. But I would point out that Mr. Fielding and his colleagues always based that preference on the advantage that it would do to Canadian trade, and only to a minor degree on the advantage it might have as between the two countries. That is a preference which we are glad should exist, and do not desire should be diminished, and which we are glad the Canadians should give. But, holding the views we do, we cannot regret any arrangement or agreement which, on the other hand, might have the effect of weakening the opportunity of imposing the preference the right hon. Gentleman advocates, and of putting a tax on the imports of foreign corn into this country. We cannot regret any arrangement which makes a breach in protective tariffs. We certainly cannot regret any arrangement under which the trade of Canada itself will be, as they themselves think, largely increased. We believe the greater the trade of Canada the greater will be the trade of the Empire, and the greater the trade between England and Canada. We certainly feel very strongly that there is no question involved in reference to this agreement of the allegiance, or of the loyalty of the Canadians themselves. That is not touched by the matter at all.

But the right hon. Gentleman said we were imperilling, in the words of the Amendment, the advantage which we at the present moment had in our trade with Canada. I think the right hon. Gentleman said, and that an hon. Gentleman said the other night, that as to the existing preference the agreement would reduce it to vanishing point. I am glad to be able to assure that hon. Gentleman and the right hon. Gentleman that the pessimistic views which they take in reference to the preference now given to us is very exaggerated. I think the right hon. Gentleman appreciated the attitude which the Canadian Government took in regard to this matter in the negotiations which took place with America. They did their best in their arrangements to affect as slightly as possible the preference which they have given to England. I think it may be well just to say that the alarm which seems to exist in some quarters in reference to this matter as to what will happen if the agreement goes through is really very much exaggerated. I will give the figures, which will be of interest as showing the actual effect of this agreement on Canadian preference, when that agreement is accepted by both sides. We send at the present moment nearly £20,000,000 of goods to Canada. Of those about £13,000,000 receive preference under the old system and the old agreement. Of that total, amounting to nearly £20,000,000, being the whole of our trade with Canada, a sum of £969,000 represents the goods dealt with under the agreement. Out of that sum we have £176,000 of goods already free to all nations, and therefore not really affected as far as preference is concerned. That leaves about £800,000 all told out of a trade of £20,000,000, which is affected by the agreement, as far as preference is concerned. Out of that amount £477,000 of British goods still retain a preference of a very substantial nature, equal to 20 to 30 per cent. of the duties on United States goods. That leaves a balance of £316,000, or only 1½ per cent. of British imports to Canada to which the duties in the future will be identical with those on American goods. Therefore, when the whole preference goes on trade that only amounts to £300,000, I think that we may say that the alarms of the right hon. Gentleman have been very much exaggerated. The right hon. Gentleman made one further point. He said that not only would this destroy to vanishing point the value of the preference now given by Canada, but that it would have a further effect, which he rather dwelt on at considerable length.


I did not say that.


The right hon. Gentleman said, I think, that it would seriously affect the preference. He went on at a considerable length to give us an economic discourse in regard to it, and said that one further result of this agreement will be that a lesser amount of Canadian corn will come to England, and that the result of that will be that the price of corn will go up here, because we shall get a smaller supply. That was the argument we ourselves have been using in reference to the question of Preference. But what the right hon. Gentleman said to that was that what would happen would be that you will have a greater demand for corn here, and that that will encourage more growth of corn, and that in the end we would get cheaper corn and not dearer corn. If that result is likely to take place in the case of Canadian corn, which is sent here without any advantage in price, is it not much more likely to occur when the Canadian farmer can get a better price in the American market, and will therefore have still greater encouragement to increase his produce, and which in the end will reduce the price. That, however, is rather speculative. The real answer is, America at the present moment is a country Which largely exports wheat and other forms of corn to this country. Indeed, a very large proportion of it comes to this country. When Canadian corn goes to America more American corn will come here than before, and I think probably in many cases at a lower rate. I think the right hon. Gentleman's fear of this proposal raising the price of corn over here is a matter which, even if it does occur, will certainly in a short time be affected at once, both by the increased imports of American corn and by the increased advantage of growing corn.

The right hon. Gentleman's chief point against us, as I understood him, was that by our persistent refusal we have thrown away the opportunity of obtaining the whole of the trade of Canada and of preventing this agreement. The right hon. Gentleman the Leader of the Opposition practically said the other day that for thirty years we had the offer and had refused it. As a matter of fact, the actual preference has been in force for thirteen years. But if it is true that our persistent refusal had been such a serious matter, I think the right hon. Gentleman ought to remember that, after all, we have only had five years out of the thirteen, while the other side had eight years. The other day the Leader of the Opposition really, I think, gave the House the impression that he almost imbibed Colonial Preference with his mother's milk, whereas we know perfectly well that it was only just before the election of 1905 that he finally accepted the principle of this taxation of foreign corn. What did he say then? He said the matter was so important, and of so much moment, and was such a new departure, that it was necessary for the country to pronounce an opinion about it. And he said the country ought to have the opportunity of expressing an opinion upon it. The country since then has had three opportunities of expressing their opinion, and three times they have rejected that proposal. I think it is a little hard, therefore, that the Government, as such, should be blamed. The right hon. Gentleman had a longer opportunity of putting their particular policy in operation, and the country itself has three times rejected the proposal. The right hon. Gentleman referred once or twice to the proposals which he desired in order to meet the difficulties. He dealt with and objected very much to some observations made by my right hon. Friend the Leader of the House in reference to what I think I may call the natural causes which had so largely to do with the bringing about of the agreement. I noticed that although he mentioned the words "natural causes "as affecting this matter, that they seemed for some reason or other to irritate hon. and right hon. Gentlemen opposite.

We believe in these matters that it is really better for all purposes, from the point of view of the trade and commerce of the world and of this country, that as far as possible we should have natural causes rather than artificial barriers between various countries. At all events, we have it on the authority of Mr. Fielding himself that those natural causes, the natural economic position of the two great countries, America and Canada, was certain some time or other to bring about this agreement which we are now more or less discussing. The right hon. Gentleman seems to think that if we had had in the last few years enforced here the scheme which they have more than once placed before the country, namely, a 2s. duty on foreign corn, that that proposal would have prevented those natural causes, would have prevented this agreement, and would have prevented any arrangement between America and Canada, and would have increased enormously the trade between England and Canada, and would have made England and Canada much more united and one than we are at present. I wish the right hon. Gentleman on some occasion, or perhaps some other right hon. Gentleman who is going to speak, would show us exactly what the advantage of their 2s. duty would be on Canadian corn. The proposal, as I understand it, is this: that we are to put a 2s. duty on foreign wheat. A little while ago we were to put 1s. duty on Colonial wheat, but that I believe has been dropped. The object is to keep out foreign wheat and to encourage the import of home wheat. When the right hon. Gentleman the Member for West Birmingham (Mr. Chamberlain) first made his proposal we were asked to sacrifice something as this would raise the price of food and the price of corn. We were asked to make that sacrifice, and we were told that he proposed to make it up in other ways. That was the first proposal. We then had a General Election, and the effect of the, General Election was——


made an observation which was inaudible.


Surely he said the 2s. tax would be a tax on food. I do not know what other interpretation except that that means it would raise the price. [HON. MEMBERS: "NO, no."] The right hon. Gentleman the Member for West Birmingham said he would have liked to have asked the people of this country to sacrifice something for the imperial interests, and he said it would cost something. I suppose he thought that we were not quite strong enough for the purpose, and, therefore, as against his tax on food; he proposed a reduction of other duties to compensate the working man. Surely that can have no other interpretation than that, in those days, it was admitted that the taxation of corn would raise the price of food. [Several HON. MEMBERS: "NO."] I quite admit that subsequently we had a General Election, the result of which brought about the development that the taxation of corn was not to raise the price of food. Then we had a further election, the result of which has been, as far as I can understand from the speeches of the Leader of the Opposition and others, that if you tax corn you will really get it at a lower price than before. There has been a process of evolution in this matter. We have always contended that if you tax corn you will raise the price. But we were told: "Oh, no; you can tax corn, and it will not raise the price." That, however, was not quite sufficient; and the Leader of the Opposition has told us on more than one occasion that if his proposal is accepted we shall get our corn and food cheaper than before. I am referring to this because I want to see how the Canadian wheat-grower comes in. The idea is that this is such a tremendous offer to the Canadian farmer that it will revolutionise the whole basis of the relations between Canada and Great Britain. We ought, therefore, to see exactly how the matter stands in regard to the position of the Canadian farmer.

As I understand, the right hon. Gentleman now argues that a 2s. tax on foreign corn will not raise the price of corn or food here. Where, then, does the Canadian farmer come in? It is quite true that such a proposal will drive from our market a large amount of foreign corn, and we shall be worse off to that extent. But how is it to bring in this enormous amount of Canadian corn if the Canadian farmer is not only not to get any better price in the British market than at present, but, on the principle of the Leader of the Opposition, is to get a lower price? Is that likely to bring about this extraordinary revolution in the relations between Canada and the Mother Country? Is that really going to add to the links between the two countries? Before right hon. Gentlemen opposite lay it down as axiomatic that their proposed Preference will create this great revolution, and that, if it had been in existence two or three years ago, the present agreement between America and the Dominions would not have taken place, we would like to have worked out in detail as a practical measure what their proposal actually is, how it would affect the Canadian farmer, and what would give the Canadian farmer such a great inducement to sell his corn here. The present position, as I understand, is that if we had had Preference in existence at the present moment, we should have been offering nothing to the lumberman for his timber or pulp, because they are raw materials; nor should we have been offering anything to the fishermen; and we should have been saying to the Canadian farmer, "You shall not sell your corn where you can get the best price for it; you shall sell it here at a cheaper rate, in order that the British consumer may benefit from it." Such a policy as that, founded on the basis either of disadvantage to the Canadian wheat grower or of disadvantage to the British consumer, is not likely to strengthen the unity of the Empire.

I do not intend to enter again into the reasons why we object in principle to the proposals of the Opposition in regard to Preference; but I desire to discriminate very clearly between the Preference given to us by Canada and the Preference which the party opposite propose to give to Canada in return. The Preference given to us by Canada we fully recognise and appreciate, although they themselves have said that they are giving it as much for their own benefit as from the point of view of the Empire. But what does it mean to them? I am not speaking in any sense ungratefully, but I must point out the difference between their position and ours. It means to them that they give a rebate on a certain quantity of goods going into the country. It is only a question of rather more or less revenue from their protective duties. We are grateful for it; but, after all, it is not a very great matter for them from the fiscal point of view. It is, however, a very different matter to us. What is the right hon. Gentleman really asking us to do? He is asking us to impose duties on articles of food and a vast-number of other articles in order to give a rebate to some of our Colonial fellow-subjects. That is a very different matter—to alter the whole foundation of our fiscal system for such a purpose, the result of which would be, we believe, to raise the price of food, to lead to discrimination between different Colonies, and to cause fiscal division between different parts of the Dominion. Much as we reciprocate the feeling expressed by the Dominion Government, much as we appreciate the fact that they have given us a preference, we do not see our way, with our present fiscal system, to make such an enormous and, as we believe, retrograde step, because we believe that the injury to our consumer and trader would be so great that it would actually re-act upon the interests of the Canadians themselves and on the interests of the Empire at large. I have endeavoured to refrain from expressing any view in reference to the proposed agreement. The right hon. Gentleman seemed to imply, in some of his excited periods, that we were practically the authors of the agreement. We deny it altogether. We contend that our policy is more likely to lead to the commercial advantage of Canada herself, and we deny that blame, if blame there be, for the agreement can be imputed to us; but it is not our business here to express our view in regard to the merits of the matter. The right hon. Gentleman put a specific question to me in reference to commercial treaties, and especially in reference to Japan As regards the general question, as it is not in my Department, I would rather not give an answer off-hand. I know the answer, but I would rather not give it myself.


I must accept that, if the right hon. Gentleman says that the matter is not in his Department; but I think we are at cross purposes. He must mean the interpretation of the most-favoured-nation clause.




What I mean is, are the Government taking any steps to secure for our goods the same rates of entry into America as Canadian goods will enjoy?


That really comes under the same heading. It is much more a Foreign Office than a Board of Trade question, and I would rather not answer it off-hand. As regards Japan, negotiations of a delicate character are still taking place. I cannot say at the present moment more than was stated in the King's Speech—namely, that we hope a satisfactory conclusion may be arrived at—a hope which I am sure will be shared by the right hon. Gentleman.

In regard to his general criticism we had, I think, the old revolver trotted out again, we were told that various countries had put up their protective duties all round. That is perfectly true. We cannot prevent that as a Free Trade country, nor can protected countries. As a matter of fact, if the right hon. Gentleman will go through the various treaties which have been made within the last few years, he will find, taking Germany, Austria, and other countries of that kind, and comparing the trade of Great Britain with those countries and the trade of other protective countries with them, that we have come out, on the whole, better than the protected countries. The fact is, as the right hon. Gentleman knows quite well, when two protected countries are going to have a fight they start by putting up their tariffs higher than they were before. They have a great fight which sometimes drags on for years. During the whole of that time their commerce is being injured, and when at last a result is arrived at they find that the wall is higher than it was before. We have not to go through that process, and we come out as well as, or better than, protected countries after the negotiations have taken place. As regards the cases to which the right hon. Gentleman has referred, I hope that good results will accrue, and that after our negotiations we may be able to make as satisfactory, or a more satisfactory, arrangement than protected countries. I must apologise for having spoken at such length in reference to the proposed agreement, but although I regret that we should have such a debate at all. I thought it necessary to answer the right hon. Gentleman in detail as far as I could. I trust I have said nothing that can be misunderstood by either America or Canada, because we disclaim, as the right hon. Gentleman disclaims, any desire to criticise their action. They must consider the matter from their own point of view. As far as we are concerned, we confine ourselves to watching and seeing what may be the result.


We have been appealed to by right hon. Gentlemen on the other side, by the Prime Minister at the commencement of this debate on the address, and by the President of the Board of Trade this evening to speak with caution in regard to the great question which is contained within the still larger question that is before the House on this Amendment. Following the example of the right hon. Gentleman the Member for East Worcestershire, I hope that nothing will fall from me that in any way will be improper for even a private Member of this House to utter in the present position of affairs in regard to Canada. But it seems to me that silence here would be just as liable as speech to misinterpretation. We cannot blind ourselves to the fact that, viewing it as we may, we must share in the responsibilities for what happens now in our American Colonies. It is true that at the moment there is a question of negotiation merely between the great Dominion of Canada and the United States. It is true that it is Canada which is primarily affected. It seems to me that if it is not foreign, at all events it is the external policy of Canada which is affected, and that external policy necessarily involves other great communities. The two great communities which necessarily have to be considered in this matter are the Home Country, which is in such intimate, happy Imperial relationship with Canada, and the great Republic of similar speech on the other side. Discussion has taken place in Canada. I see that already the Leader of the Opposition in the Canadian Parliament has said that Canada has recently been developing on west and east lines. Canada, he said, commanded the eastward opening, and commanded Canadian relationships. The United States commands the southward. If we have closed the eastward, or refused at any rate to open it, it cannot possibly be said that we have no responsibility. At any rate as a party, which, although in a minority at the present time, may—I think hon. Gentlemen opposite to me will allow—come to be a majority presently, and be responsible for the policy of this country, it seems to be essential that we should indicate to those who are in Canada, that our attitude has not been changed with the General Election which has taken place, or by the negotiations which are now in progress. I think it is our bounden duty to speak. Silence would be misinterpreted, or be liable to it. Misinterpretation would doubtless be put upon it, and in the circumstances the only course open to us is to follow the difficult path of cautious utterance. The right hon. Gentleman who has just spoken made much play with the successive stages in the presentation of Tariff Reform from this side. He twitted our party with the fact that while it was in office it did not carry through the policy which it now advocates. I do not think an appeal to that kind of argument has very much force in it. As a private Member I frankly state that I was a Free Trader. So were we all. So, at any rate, were the great majority—I will not say all on this side. Events have converted us. We have been converted at various rates, but we stand now practically solid, converted by facts. Apparently gentlemen on the other side are uninfluenced—we think so, at any rate—by the events which have taken place. As an individual I am not in the least ashamed at having been converted by a new situation.

There was another point made by the right hon. Gentleman which I want to refer to. He said that possibly the effect of the export of Canadian wheat into the United States might be that there would be less wheat coming here; that since the United States is at present using more wheat than her population consumes there would naturally be more wheat coming from the United States to this country. That, I believe, not unfairly states the argument put by the right hon. Gentleman. But whether wheat comes from Canada or the United States, it has to be paid for. In the case of Canada I believe our exports per head of the population amount to several times more than our export per head of the population to the United States. Therefore, it is obvious that the tariffs of the United States would put some difficulty in the way of our manufactures sent to the United States to pay for a greater amount of wheat coming from the United States. The reply, no doubt, of the right hon. Gentleman would be that trade would follow the triangular path; that more wheat would go from Canada to the United States and more wheat from the United States to here, and that we can only strengthen our exports to Canada. I venture to think that there would be a growing agitation in the United States for a further reduction in the Canadian tariff. There would in all probability be an increasing demand for further revision, an increasing pressure against Canada which would become more and more difficult to resist.

I want to turn from these matters to what seem to me to be very much larger questions. May I put this point? It seems to me that what is deeply the question of the present moment is a matter of internal Canadian politics. Hon. Gentlemen know well that there are at the present time two Canadas—Western Canada and Eastern Canada. These two Canadas are knitted together by a system of railways through what is for practical purposes almost a waste for a thousand of miles. The great problem for Canadian statesmen at the present time is to hold Western Canada to Eastern. Canadian policy has been proceeding in that connection for a long time past. Sir John MacDonald made the first railway and constructed the first tariff raised against the United States. After that time Preference was granted to this country—it has been freely said for the benefit of Canada—in order, that is to say, to add strength to the western and eastern parts. What was the first object? The object of putting up the tariff against the United States was to lead to this: that the new population growing in the West should buy its manufactured goods from Eastern Canada rather than from the United States. In other words, that the population manufacturing those goods should be located in Eastern Canada rather than in the United States; that the population of Eastern Canada might pari passu grow with the population of Western Canada. Then, with the growth of the West natural pressure Southwards increased. Canadian statesmen cast about them for some means to strengthen the East and West tendency. They found it in the preference granted to this country, in order that those things they could not make in Eastern Canada, and which could be most advantageously exported from this country, should be obtained from this country rather than from the United States—in other words, that the population manufacturing these goods should be situated in this country rather than in the United States. Then, when we did not reciprocate, Canada went one step further, and a short time ago made a treaty with France and went into the consideration of one with Germany. What was the effect of this? Still further to strengthen this East and West community of interests, and still further to tend to hold the West to the East. It is quite obvious that there must be certain pressure against this. There is the natural southward tendency, we admit it. This natural pressure, it is urged, must be overpowering. It is called in the Press of the other side "the influence of nature." We know perfectly well that the whole of Canadian policy was against nature. Gradually they have strengthened that policy, step by step as the southward tendency increased. No doubt hon. Members opposite will say that ultimately the growing population in the West would meet the growth of the interests eastward and must overpower it. [An HON. MEMBER: "Hear, hear."] I am glad that hon. Gentlemen admit that there is a fair statement of their views. It rests upon one thing—that this tendency of the West southward will continue indefinitely. Why does that pressure exist? Simply because the West is in a transition state. The West has not yet the industries which the West will inevitably develop. At the present time in the West you simply have, for practical purposes, an agricultural population with raw material to sell. There are incipient industries in Winnipeg, and it is obvious to everyone who goes through British Columbia that there are enormous potential forces available for industry in that country.

You had only to hold on sufficiently long and you would have passed the dangerous epoch. Your agriculturists would have added to them, and balancing them, the industrial complement of their number, there would have been a relaxation of the pressure southward in the West, and your object and whole policy would have been achieved. It seems to me that the right hon. Gentleman all through his argument omitted the element of time, which is of the very essence of the whole situation. What is the present position? What is it that is in the minds of the statesmen of Eastern Canada? In the West there is a great agricultural population, of which a great and large element is drawn from Europe, and which is not, at all events, British. Balancing the British and Canadian element, there are certain forces—I am not talking of Imperialism now—which, by conviction and tradition and sentiment, are not yet Canadian—both the American emigrants and also the European emigrants who are not of British origin. If you will not help to strengthen the Eastern and Western bonds, the time may come when the Eastern and Western bonds will be not sufficiently strong to hold the West, and what clearly is the position is that the West might take its own destiny into its own hands and break away and join the United States. The Eastern statesmen have to face that position. With all the eloquence they could command compatible with national dignity they ask you to strengthen their hands. You refuse to strengthen their hands, and, as practical men, they have to consider affairs. Sentiment is still good, and rather than run the risk of losing the West now they save the present at the cost of the future.

That, I say, is the real position, not expressed or to be expressed by responsible Gentlemen here upon the Front Bench, and not to be expressed above all by Canadian statemen, but still in the back of their minds that is the position. There is that portion of Canada away out in the West, clear away from the reach of power with its destinies in its own hands. You can appeal to it with interest. You cannot coerce it. Interest has been built up as long as it possibly could, and that interest could be built stronger, but this country has not seen fit to do it. Had you been willing to help, had you been open to the conviction of events as we on this side have been, the result would have been that you could have helped, because you would have made it worth the while of the West to delay; you would have delayed the pressure south, and you would have enabled Canadian statesmen to postpone the time, I think probably at the rate things develop, until the industrial weight in the west would have come to its aid and the southward tendency would cease.

In reply to all that you tell us that it is inevitable—laissez faire! Let Nature take her course. That is your answer. I think that is the sentiment held by hon. Gentlemen opposite. They say it is inevitable. Is it, for instance, according to Nature that you build a battleship upon the banks of the Thames? I am not finding fault with you for doing that, but I venture to say that in doing it you are doing an artificial and unnatural thing. You do it with the object of trying to provide wages and to find employment in the East End of London. Then why not take the course of trying to find employment in the East of Canada and in this country rather than in the United States. You say that this thing was inevitable. Was reciprocity inevitable? When a few years shall have elapsed, according to statistics, they will probably carry us to the time when the United States will require all her own wheat production. When these few years shall have elapsed, was the only course open to the United States to offer reciprocity to Canada? Do not hon. Gentlemen opposite hope that the Free Trade principle will triumph even in the United States. Would it not be open to the United States to throw her ports open altogether to the wheat of the whole world. If she wants wheat from Canada, why not from the rest of the world? Why does she offer reciprocity to Canada? Because she wants more from Canada than merely wheat. She is looking forward while you refuse to do so. She knows she will have to throw her ports open, either to the world, or to her neighbour, and while it is yet time, she has made her bargain. We are forced to the idea that in the view of the United States reciprocity is not an unimportant matter.

What is Canada to get? Why is there a bribe to Canada? Canada gets an exclusive market in the United States with an 8s. duty against all comers. That is the nature of the bribe; not the raising of prices; for the action of that duty has not up to now raised the price in the United States. At any rate, speaking apart from partial exemptions, the price of wheat there is not dearer. What the United States is offering is for the future? You say in reply, what bribe could we offer? A 2s. duty, once Canada and this country together, were producing the wheat necessary for Canada and this country would be as effective as an 8s. duty. Once this country and Canada together produced as much wheat as this country and Canada together require you are in the condition of the United States, where even an 8s. duty does not raise the price of wheat. To my mind the bribe which we could have offered would be an exclusive market for food, as far as wheat is concerned, of four-fifths of our population. What is the exclusive market the United States now offers to Canada? Nothing at present, except when we deal with special grades of wheat. The bribe that we would have to offer would be the establishment of a gradually exclusive market for wheat in this country or a greater bribe than that which the United States by means of reciprocity could afford, at any rate for a great many years to come.

I notice that the right hon. Gentleman opposite said he preferred to talk of a tax upon corn. It is not necessary that we should accept the misrepresentations of our opponents, and it is precisely of that we complain. They have practically misled and hoodwinked the country in regard to what our policy is. Their attitude is one which omits also the element of time. Our complaint is that the Free Trade argument, from beginning to end, omits time. Our case, if I may so, is an investment for the future. (Laughter.) Hon. Gentlemen laugh at that. May I remind them they are living in days when the United States sinks as an investment £70,000,000 money in building the Panama Canal, the return for which will not be available for ten years hence. May I remind them that the German Empire of today is building a fleet so that she may gain influence in the future in national diplomacy? We have come to the time when nations, like individuals, must invest for the future, not merely for the present. Our complaint is that the party opposite omits altogether this element. We all know that if you build a small factory it will have great difficulties in holding its own against great and already established competitors. If by good fortune, by courage, and by the help of others it can be built up to a sufficient scale, then new advantages arise and it holds its own in competition. I think it was Prince Bismarck who said that Free Trade is the policy of the strong. I think it was the Leader of the Opposition who pointed out what is the actual state of things. Competition and the scale of production is no longer in our favour, and the aim is to build for the future by adding to the productive basis of our power. The broad acres necessary are to be found in our great Colonies. From that point of view it is that this agreement is full of such meaning for this country. If you establish, as the right hon. Gentleman the Member for East Worcestershire (Mr. Austen Chamberlain) said, a southward trade, the trucks will not go northward empty, and if, in consequence of the increasing demand for raw material in Canada, an increasing number of trucks are send northward empty, you will find an increasing pressure from the United States for the reduction of the tariffs that remain, and an increasing agitation against the preference granted to this country, and that will act upon a population drawn in part from the United States itself.

6.0 P.M.

I do not wish to exaggerate the immediate importance of the position. The whole point of difference between us and hon. Gentlemen opposite is this question of time. We venture to think it is essential. They are content with the present outlook. There is excellent sentiment prevailing at the present time. I notice that sentiment is the burden of most of the speeches delivered from the other side. They are a little illogical in complaining that we appeal in our perorations to Imperial sentiment. I venture to assert that we appeal to a great deal more than sentiment. Their Imperialism is by their own admission wholly sentiment. They believe that sentiment is like the spirit of angels, ethereal and eternal. We believe that sentiment is a human characteristic, and that, like all other human characteristics, it requires nourishing. The Imperial sentiment of yesterday had something of homesickness in it, because you were dealing with a generation which had emigrated from the Mother-country. The present generation has Imperial sentiment because of the great idea of Empire. Their loyalty is no longer to the Mother-Country, but to the Empire, and that is the whole significance of what has taken place. You refuse to build that Empire by looking forward to the future. You are profiting by the sentiment of to-day. The King goes to be crowned in India, and the Duke of Connaught goes to Canada, and both will have a great reception, but you refuse to build a basis for the sentiment of the future. If you persist in the present position—no fatal step is yet taken—gradually the alternative will come before Canada of choosing between Washington and Westminster. It has been said, I think, by Sir Wilfrid Laurier himself that Canada comes too late into the competition of the Great Powers of the world to assert herself successfully as one of those Powers. Necessarily, she is drawn into the orbit either of Washington or Westminster. What would result from her being drawn into the orbit of Washington? I am going to ask to be allowed to take a rather long view in these days of national investments for the future. If Canada in ten, twenty, or thirty years' time, is drawn steadily into the orbit of Washington we must not be surprised. The present crisis is grave because it is the beginning that counts. You have no control over the later stages. When a stream overflows an embankment there is at first a little rill, which you may dam, but afterwards, when the breach is widened, you have no control over the flood.

Ultimately we have to look to the question of power—I use that word advisedly—and power rests upon economic development. If Canada is drawn into the orbit of Washington, then this Empire loses its great opportunity. The dismemberment of the Empire will not be limited to Canada. Australia will avail herself of the power of the American fleet in the Pacific, and she will not long depend on a decaying and breaking Empire. Then, with the resources of this island country you will be left to maintain your position in India. (Laughter.) Hon. Gentlemen opposite laugh. They are advocates of peace. They do not realise the position in the world at the present moment. Three great Powers by their balance maintain the peace of the world. If the British Empire goes under, then you come to the position of one great Power in America and another in Europe, and no third Power between them. That means in the long run a contest between those two Powers, and the tyranny of the world. That constitutes, in my opinion the significance of the present crisis. We are at the turning of the tide. (Laughter.) Hon. Members who laugh have not the imagination to see that from those small beginnings still under our control in this country great things may come. Let them bear their responsibility in the eyes of posterity.


After listening to this rather remarkable flight of Imperial oratory and imagination, I, as an ordinary plain business man and a humble Member of the British House of Commons, venture to interpose in this discussion. In reply to the hon. Member who has just sat down, may I enter my strong protest against the arrogant claims which he has ventured to put forward across the floor of the House of Commons that he, and those who think with him politically, are the only people who have regard for the welfare of this nation. I listened with anxious care to the speech of the right hon. Gentleman who moved the Amendment, but even at the present moment I have still to be convinced of the necessity for this Amendment, or, indeed, the wisdom of it being moved at all. I gather that Canada is a free local self-governing colony, with full power to work out her own destiny in her own way. People talk about the disruption of Empire, but is seems to me that you cannot more quickly disrupt this Empire than by impertinently interfering with the business affairs of another nation. I have been wondering what is the cause of this Amendment. I gather that the Government are to be blamed because they refuse to establish a fiscal policy under which preferential treatment could be given to Canada. Does the right hon. Gentleman not understand that the Government is in power at this moment wholly and solely because the nation has told him that they are not to undertake any such fiscal work. The Leader of the Opposition made his bid for power to arrange the fiscal policy of this country, and offered a referundum in case the people granted him that power, but the country was so much afraid of fiscal reform that even with that tempting bid they refused to put into power a party which intends to tax the food of the people as the bed-rock of giving preferential treatment to the colonies. I gather that the basis of preferential treatment to Canada must be a tax upon the food of the people. [HON. MEMBERS: "NO."]

It does not make any difference, and at any rate it means an increase in the cost of living. Upon every platform in the country in the agricultural district, right hon. and hon. Gentlemen opposite have posed as the great friends of the farmers and the agricultural interests of the country. Will not this arrangement advantage the British farmer to the degree that Canada sends her corn into America and does not send it into this country? To that extent one competitor will have been removed from British agriculture. We hear nothing about the advantage to the British farmer, and it is all about Canada.

Let me say at once on behalf of the party in whose name I speak, I make the plea and stand upon the broad platform that it is not wisdom for this British House of Commons to interfere with the work and the legislative measures performed by the Canadian Parliament. I think it would be well to remember and try to understand what is the cause of this reciprocal arrangement between America and Canada under which Canadian corn and timber is to go free into the American market. It is a democracy in rebellion in America, a democracy in revolt against the enormous cost of living in the United States that has compelled the American politician to make overtures to reduce the tariff walls so that it may be possible for the American democracy to live cheaper than it does at the present time. I happen to have been in America in the Autumn when the great political contest was going on. A distinguished leader on one side is ex-President Roosevelt who is one of the most astute politicians and electioneerers in the world; yet despite his personal popularity and acuteness the democracy refused to put into office any man or men who have not pledged themselves to reduce the cost of living. I read some of the newspaper speeches, and I discovered that it was stated by responsible American politicians, seeking such high office as Governors of States, that the cost of living in America during the last five years had gone up 73 per cent. That is the cost of this arrangement. The right hon. Gentleman's Amendment blames the Government because they will not make themselves responsible for creating a fiscal system under which we shall have repeated in Great Britain the condition of affairs which has arisen in America. The British democracy will not stand it. [HON. MEMBERS: "Oh, oh."] I am speaking as a successful candidate at the last Election, and as one who fought his battle upon this issue as part of his political programme. I am also speaking as one who was returned to this House as a Member of Parliament not with a majority of hundreds but of thousands. I think, therefore, I am entitled to say, speaking with those credentials that, at any rate, the British democracy, as represented through the constituency which I have the honour to represent, will not stand that. The fiscal system of America breeds trusts, combines, and syndicates, which produce millionaires. Millionaires means paupers, and pauperism means the disruption of Empire. Despite what hon. Members may have said about unemployment not existing in America, may I give to the House a quotation which I took out of the St. Louis "Post-Dispatch" newspaper of November 26, 1910:— The Bowery Mission estimates that there are 4,500,000 unemployed in the United States. Well, at any rate, it is to be expected that hon. Members opposite will pay the American people the compliment of knowing their own economic conditions better than anyone else. This is a quotation I have taken, not out of a British paper, but out of an American paper when I was in America. This paper adds:— It is mistake to judge the rest of the country by the number of loafers in New York. There we have it stated that 4,500,000 unemployed are to be found in the United States. The genesis of the arrangement between Canada and America is the pressing necessity of the United States itself driven forward by an educated and an intelligent American democracy. Have we no interest in the fiscal system of our own country? It is all right enough for right hon. Gentlemen to come here and speak about the stars, the moon, the heavens, and all that, but we have got to live on earth. I represent men who have to live by getting coal. I represent, as a Trade Union Leader, the greatest export coal trade in the world, and I am amused, therefore, when I hear people talk about dumping and say we will not have this dumping of things into our country. Why, the whole of South Wales lives upon successful dumping. It is only to the degree we succeed in dumping our products into other people's countries that we live at all. I therefore, very naturally, address myself to a question about which I know something. In 1909, which is the latest return I think, we exported 63,076,799 tons of coal to other countries. When I look carefully through the list of nations we were sending coal to, what do I find? France received 10 2–5th millions, Germany 9¾ millions, Italy 9 millions, Russia 4 millions, Egypt, Denmark, and Spain 2½ millions, and Argentina over 2 millions. Hon. Gentlemen opposite pose as great economists, and, if they are, they must understand that when we send our products to other countries we are paid with something which we bring back. Argentina sends us corn, Russia sends us corn. What have we to complain of? If we do not buy their corn, how can they buy our coals? And as a coal man I am here to have something to say to a fiscal system which is likely to destroy the industry which gives a living to so many hundreds and thousands of people. A cheap cost of living is the first essential to our people. A cheap cost of living is only possible when our markets are open to the Empires of the world. Hon. Gentlemen talk as if we had done something to injure Canada. Our markets and ports are absolutely open to anything Canada is likely to send. We have done no injustice to Canada, and, let it be said for the Canadians, they have not asked us to penalise ourselves for them. They do not ask us to give them such preferential treatment as will reduce the standard of comfort in the homes of the British people. They simply use their own freedom, their liberty and their authority to work out their destiny in their own way, and we shall best consult the interests of the Empire if we try to be a little careful on an occasion such as this not to use language or to discuss their position in such a way that they may feel themselves, as a free, independent people, insulted.

Why is it we never feel anything of the shortage of harvest at all? Whatever else I am not entitled to say, I am entitled to say that the labouring classes we represent have a higher standard of comfort in Great Britain than have the labouring classes in almost any other country in the world. Protection has not given them in Germany, in Austria, in France, or in Belgium either greater wages or a higher standard of comfort than we possess. Through our ports being open, our bread has been cheap, and, consequently, we do not suffer to the degree that many countries suffer from shortage of harvest. The reason we enjoy the privileges we do enjoy to-day is because, in my judgment, of our fiscal system of open ports, through which we make the world our granary, and by which we are not bound and tied to any nation or any locality. On behalf of the Labour party, I rise to oppose the Amendment. We unanimously oppose it as a party. We are not satisfied with the economic conditions of this country, we are not satisfied with the condition of our people, we are not satisfied with our wages or with our general conditions, but we refuse to be side-tracked into supporting a fiscal policy that has led in the countries where it has been tried to a lower standard of comfort than we ourselves enjoy.


I would venture to address only a comparatively few remarks to the House in reference to this most important Amendment to His Majesty's Gracious Speech. I think I may, without impoliteness, perhaps be pardoned from following the hon. Member who has just spoken into some of the ramifications of his speech. Perhaps he will not think it offensive if I say that his speech, coming as he does from a contested election, savours rather of the breezy air of the hustings than of the arguments sometimes adduced in this House. Far be it from me to complain of such an air, because I am not quite sure that some of the fresh air of the hustings might not be an advantage to this Assembly. I would however, offer a few remarks, by way of criticism, with regard to some of the statements and some of the arguments made in the speech delivered by the right hon. Gentleman the President of the Board of Trade, and also with regard to the general attitude of some hon. Members opposite on this question. The hon. Member who has just sat down referred to the interference by Members upon these Benches, or the wish for an interference, with Canadian policy. I thought our attitude had been made perfectly clear. There is not a single Member upon these Benches, I feel perfectly sure, who arrogates to himself or to his party for one single instant the wish to interfere with the self-governing Dominions in any of the fiscal or other acts they choose to take. At the same time, it must be recognised by hon. Members opposite, as well as by those on this side of the House, that the policy we adopt must inevitably affect the Dominion of Canada, as the other Dominions in the decisions they may come to in the course of any agreement they may make or refuse to make with other countries. If any proof of that is required, it lies in the statement already quoted by the right hon. Gentleman the Member for East Worcester (Mr. Austen Chamberlain), made by Sir Wilfrid Laurier in the Canadian House of Commons. He there stated distinctly that:— If the result of the British election should prove to be a victory for Tariff Reform, there would be little prospect of any large measure in favour of a reciprocal lowering of Tariffs with the United States.


Will the hon. Gentleman give me the date of that?


November 22nd of last year in the Canadian House of Commons. If I am incorrect, of course, I shall be delighted to withdraw at once.


Is that quotation from the Canadian "Hansard"?


It was given me as correct, but, of course, if it is incorrect I am ready to withdraw at once. It does not affect the main point. No one on these benches for one instant wishes to arrogate to himself the wish to interfere in the actions of any of the self-governing Dominions; we realise that the policy of His Majesty's Government, by its omission and not by its commission, has influenced the Canadian policy in a way we think most deplorable. One may be allowed to protest, and I wish to do so without any impoliteness, against the levity and frivolity with which some hon. Members opposite treat a matter which seems to us of such vital importance. Some of us think this equally with some social reforms one of the most vital of matters, and we do protest against the levity with which it is treated, not only in the Press, but also by some hon. Members opposite.

Coming to the actual arguments about the question, may I, for one instant, allude to what I think are some of the misrepresentations that have been already made upon the subject. The President of the Board of Trade stated that in our Tariff Reform policy we were asking to put duties on all articles of food, as well as on a vast number of objects. May I ask the right hon. Gentleman to point to any authoritative statement by any Member on this side of the House that we are asking for duties on all articles of food?


What I had in mind was that Canadian Preference meant the taxation of corn, and so on. If I used the word "all" it was a mistake, but I do not think the House misunderstood what I was referring to. Those who propose Preference, as I understand them, desire to put a duty on corn, on meat, on dairy produce and on other articles of food of that description, and on many other articles besides.


I do not wish to impute to the right hon. Gentleman any statement he did not make. I will only remind him that at that portion of his speech he was really dealing with the question generally, and had left his references to Canada, so that any mistake I made was shared by some of my hon. Friends around me, and we were perfectly genuine in thinking that the right hon. Gentleman was referring to the Tariff Reform policy as a whole, and not simply to those articles of food we import from Canada. Surely the right hon. Gentleman is a little inconsistent himself, because if we are dealing with the Tariff Reform policy as a whole, tea and sugar come into the question,' whereas, if we are dealing with Canada in particular, then no doubt it is only corn and meat and such articles that are referred to. I will now deal with another point the right hon. Gentleman discussed. He argued that, in comparison with other protected countries, we were at an advantage as regards those countries in the matter of our exports of manufactures and other articles to neutral markets. That, at any rate, was the impression he gave us, and it is a fact of which we categorically deny the accuracy. Take, for instance, the trade in manufactured articles of Germany and this country, with the United States as a neutral market. The right hon. Gentleman says that there we have an advantage. We assert, on the contrary, that the course of our trade will be found to be disadvantageous as compared with that of our protected rival—Germany. This is a plain issue on a matter of fact. I hope I am not misrepresenting the right hon. Gentleman, but I want to get an answer to the question whether or not our fiscal system is advantageous to us as compared with our protected rival in dealing with neutral markets. The right hon. Gentleman says it is. We deny it, and if you will take the instance I have cited—that of our trade and German trade with the United States, I say let the facts be produced, and we will be content to abide by the issue.

There is a further point I should like to deal with, and that is the amount of the trade which is affected by the present Canadian agreement. The right hon. Gentleman produced an analysis—I do not dispute his figures—as the result of which he stated that the volume of British trade in Canada affected by the present agreement amounted to a sum of £800,000, of which about £477,000 would still have a substantial preference amounting to 10 or 12 per cent., while the remaining £300,000, which was affected, only constituted 1½ per cent. of the total amount of trade. I would suggest to hon. Members opposite that these figures in themselves are very considerable and ought not to be dismissed without consideration. As to the amount of trade affected, when the right hon. Gentleman dismisses his £500,000 by saying that there is still a preference of from 10 per cent. to 12 per cent., may I read a telegram received this afternoon, which shows that the effect of the reduction in preference, even though a certain amount may be left, that amount is really counterbalanced by the comparative expenses of transport. The telegram which was sent to an hon. friend of mine, said:— Returns show Canada imported £300,000 value galvanised sheets during 1910. Fear withdrawal of 5 per cent. duty would very gravely jeopardise this business. That telegram comes from Wolverhampton, and I only bring it forward as one instance showing what may be the effect of this proposed arrangement. The whole point is this. You may have a certain amount of preference left, but it must be self-evident that even that may be neutralised by the difference in the cost of carriage, and that the trade which retains that small preference will be still just as much jeopardised as the remaining £300,000. It is not only the existing amount of actual trade which is jeopardised that has to be borne in mind. We have a statement made by the Canadian Prime Minister at the Imperial Conference to the effect that had we adopted another attitude in this case not only would we have had our existing preference, but we might have had a larger preference than at present, so that the amount of £800,000, had our action been wiser, would have been still larger. The Canadian Prime Minister went on to say: "We are bound to say that though the preference which we have given has not done as much for British trade as the British merchant or manufacturer would have liked, we have told the British people at the same time there is a way of doing more, and that there is a preference of mutual trade." Thus we are told by the Canadian Prime Minister that there is a possibility of increased Preference, which would make the figure bigger with the present population, and possibly a vastly larger amount of trade would result, for as everyone knows the population of Canada—a potential consumer of our articles—is increasing with a rapidity denied to any other country, not excepting even the United States. The only argument to which in the end hon. Members opposite recur as a last resourse is the old laissez faire argument, namely, that what they are pleased to term the "natural" is, ex hopothesi, the best. But that is an argument which is abandoned by the whole trend of current modern thought. In every other matter there is State interference—in public health, in local government, and in all other departments of the State, and what is falsely called natural has been given up. The existence" of the Labour party, as a matter of fact, is the negation of laissez faire, depends upon assumption that in the sphere of social economics, as in other spheres, you can no longer take what is the "natural" way and leave affairs to follow their own bent. It is necessary to interfere, and in the interests of certain social reforms, which we all have at heart, we must interfere with the old laissez faire system. If that has come about in matters of internal social economic policy, surely there is a theoretical case at any rate for asserting that there is no immutable law—like the canons in the Sermon on the Mount—in the matter of foreign trade. I think we are entitled to ask the Government, seeing that they are meeting us with a complete non possumus in this particular instance, what they are going to give us as an alternative. We have seen no symptoms that they realise their responsibilities, and granting that they are debarred from preferential trade in meeting this situation, what do they propose to do? The Secretary of State for the Colonies, or the Under-Secretary, will no doubt assert that, being debarred from this avenue of closer co-operation, they will take other steps. But hon. Members who have studied the Blue Book will find that steps which have been taken in the past have been prompted by the mere desire to justify their existence. We on these benches think the policy of Imperial Preference may not only prove to be one of the first steps to closer co-operation in the matter of trade, which we all think it will promote, but we want it far more for the mutual influence it will have on the relationship between the Dominions and ourselves. We want to be doing things together instead of the growing habit of doing things apart, as is signified by this agreement. Our ultimate object, too, is dictated by no megalomania, as some hon. Members opposite seen to think. We want an Empire not for the size but the quality it might possess, through the lessons that each part can learn from the others. We think, and the Labour Members surely will agree with us in that, that if we have a closer knowledge of what, for example, Australia is doing in the matters of sweated trade and the minimum wage, and if we have fuller information of what Canada is doing in the way of arbitration in trade disputes, there would be a chance of steady, regular progress forward, without either stagnation or the danger of making rash mistakes.


The case of Canada has gradually been introduced into this Debate until it takes a prominent position, and nobody can doubt for one instant that the arrangement between Canada and the United States will alter the course of trade to some extent. Nobody on this side of the House will doubt that mutual preference might increase trade between England and Canada, but what we contend is that the cost thereof would be infinitely too great so far as the price of food and the cost of living is concerned. This is the point we have laboured for for the last seven years. I would like to allude to another aspect of this question. This Debate will have a reaction in Canada, and I fear it will be a mischievous reaction. The Canadian Parliament will be debating this question to-morrow or the day after, and there has already been an intervention by a Canadian statesman in answer to an allusion by the Leader of the Opposition. Although I acknowledge that the right hon. Gentleman the Member for East Worcestershire, in the whole of his speech, refrained from any expression which would be offensive to Canada or Canadians, yet there was an implication of censure throughout the whole of his argument. I admit that it was censure of ourselves primarily, but it was censure of Canada in the second place.


I beg the hon. Member's pardon. The matter is of so much importance that I cannot allow that statement to be made. I must have expressed myself very badly if it was not plain to every Member of the House, that I recognised that Canada's interests must be guided, directed, and decided by Canadian statesmen alone, and I thought I had made it impossible for anyone to think that I criticised the action of Canadian Ministers or the Canadian authorities.


I admit distinctly that the whole of the right hon. Gentleman's speech contained no offensive expression, but the whole tendency of his speech and of the whole debate is, I maintain, an implication of censure on Canadian policy. I think that is rather ominous and alarming, but I do not think it is altogether regrettable. I do not regret it for this reason: I think that this occasion will serve as an example and as a warning of what they and other Colonial Parliaments may expect in every Session of a British Parliament under a system of mutual Protection. I think it is quite clear that if they must surrender their highly-prized independence we shall criticise under such a system every duty that the Canadians put on to protect, and we shall not only criticise every duty that they put on to protect but every duty they remit. They will have a right to criticise us, and we shall have a full right to criticise them. And that I maintain is a system which does not tend to Imperial unity. I agree with the words of the right hon. Gentleman to the effect that the basic principle of Canadian policy and Canadian finance is fiscal independence. I could go into this at much greater length, and I could take a hundred examples of speeches by the present Prime Minister of Canada and other Canadians—in fact, they never make a speech on the subject of their existing relations with England without insisting on the final, complete and absolute fiscal independence of their own Statesmen. If there is to be a permanent recognition of the principle that each community knows what is best for itself then we cannot go wrong, but I am pointing out the danger of a system under which this independence would have to be surrendered and under which we should be constantly and perpetually replying to each other's criticism and condemnation. Of course gentlemen opposite say, in words the British people must determine for themselves, and the Canadian people must determine for themselves, what is to be done in such matters, but such an independence is incompatible, and is irreconcilable with a real system of mutual Imperial preference. I hope this debate will help the country to realise this, and I hope it will also help Canada to do so. The difficulty that I point out would really arise in a very short time, and then we should find where the shoe pinches. It is in times of depression and unemployment that the demand of our people for cheap foods and open ports will be irresistible, and it will be in the face of such facts that Canada will have the right to criticise, to complain of, and condemn any reversal of the preferential policy, when it results in the destruction of capital and loss to labour in Canada by the action of this House and of the British people. They would have a vested interest in their preference and in the direction of our policy.

We have experience of Canada in regard to this very matter of Canadian preference. We have a very wide and very long experience of it. This is the Coronation year. Eighty-three years ago was the Coronation year of Queen Victoria. At that time we had a preference with the Colonies and the preference with Canada was in full swing. We had some 80 preferential duties, and they were very considerable ones. They were preferences of this kind. Canadian timber was admitted here with a tax of 10s. a load, and foreign timber was admitted with a tax of 55s. a load, and so on all round. The preferences were tremendous, but in that Coronation year Canada broke out into an armed rebellion. This doctrine of Canadian preference is held up to us as being a cement which will bind together the Empire. If I believed it were a cement, Free Trader as I am, I would sacrifice a good many economic considerations to gain it; but for my part I believe it is no cement, and I suspect it is dynamite. About the time of which I am speaking, Mr. Gladstone, who, I think, succeeded Lord Stanley, was Colonial Minister, and in a dispatch to Canada he spoke of the preference that then existed as "an exchange, not of benefits, but of burdens." In attacking mutual preferences of this kind I wish it to be quite understood that I am not attacking the free preference as it exists at present. One has no relation to the other. It was just after the institution of preference by Sir Wilfrid Laurier that he uttered these words:—

There are parties who hope to maintain the British Umpire on lines of restricted trade, but if the British Empire is to be maintained it can only be by the most absolute freedom, politically and commercially. In building up this great Empire to deviate from the principles of freedom will be bad and do much to weaken the ties and bonds which now hold us together. These words were uttered by the statesman who instituted the present form of Preference with this country almost immediately after he had established that system. Of course, it was a free gift for benefits received, but it is said that it cannot be expected to continue unless we return it in kind. If, however, we are to make a balance-sheet of debit and credit between this country and Canada, then I maintain, as things stand, and with the one-sided preference which exists, there is no existing debit balance against the Mother Country. There has been a good deal of criticism of this proposed treaty on its merits. This reciprocity is no new thing between Canada and the United States. We know very well that there was a wide reciprocal treaty of trade from 1854 to 1866 between Canada and the United States, and when that treaty was made British Ministers loyally and energetically supported Canadian statesmen in trying to bring it about, and it was very largely through the good offices and the wise diplomacy of Lord Elgin that it was obtained. After that time it is a matter of history that Canadian trade had a remarkable and splendid expansion, and it is a matter of history that in 1866, when it was ended by the United States, there followed a long period of depression; but Canada was always ready to renew her reciprocal relations with the United States, and there never was a time when she was not only willing but eager to do so. She made offers in 1869 and in 1873, and Sir John Macdonald and Sir Alexander Mackenzie were both as favourable to an arrangement with the United States as was Sir Wilfrid Laurier. We have had the effects of this proposed treaty described, and it is rather a relief to me to find Tariff Reformers trying to recognise scientifically what would happen to a price when the area of supply and demand is altered by a duty or a tariff. Supposing that the arguments of some of the opponents of this treaty are correct, and it means that if it passes we shall have to pay more for Canadian wheat. Is it not possible for us to take up the position of Canada in this matter? She is to refuse apparently a higher price from her next-door neighbour in order that she may give us her wheat at a lower price in consequence of law and of tariffs. This is the attitude which has been taken up by many papers and by Members of this House. But it seems to me to be an extremely mean and unpatriotic one, and one which contrasts extremely unfavourably with the attitude of the Western farmers to-day. On that point I may remind the House that they have expressed patriotic sentiments, not only individually, but collectively, to the effect that they disdain enhanced prices which were to be gained artificially at the expense of the British poor.

7.0 P.M.

I think this contrast is rather a humiliating one for those who have put forward the argument. It has been made quite clear that those Tariff Reformers who are fearing higher prices for Canadian goods are wrong. It has been pointed out that the United States are still an exporting country, but I do not think it has been pointed out what a large exporting country it still is. It produces on an average some 650,000,000 bushels of wheat per annum, and although the Americans are great eaters of wheaten bread and eat a good deal more than we do, nevertheless they do not eat all that. They do not eat it by a good deal. Their consumption does not amount to 500,000,000 bushels at present, and on the average they export, either in the form of wheat or wheat flour, the equivalent of 115,000,000 bushels. They are a very long way from being a nation which finds it necessary to import wheat for their own supply. They do not want Canadian wheat to supplement their supply, they want it to mix with it. They have it already for their export trade, because they can and do import it from Canada and get 99 per cent. of their duty back. They want it to improve the quality of their own wheat, and every bushel that comes into the United States immediately liberates a bushel for export, so that our total supply will remain the same and the price will remain the same for many years, and when the time does come when the United States cannot support its own population and find itself in bread, it will not be any slight fiscal arrangement with this country which will keep it from absorbing what it requires from Canada. This bugbear rests upon a fallacy. The truth which underlies the whole movement, and it is one which hon. Gentlemen opposite are very unwilling to see, is that it is a Free Trade movement. They will not see that in all the world the consuming populations are struggling to burst the Protectionist bonds. Tariff Reformers are blind to the gathering force of the movement. The Aldrich-Cannon-Payne tariff has been the last straw, and the camel is struggling rather to shake off its load than to stand the proverbial broken back. In Canada the movement is stronger still. It is a real Free Trade movement, and I will not waste time in making quotations which can readily be multiplied from Canadian newspapers, to prove that it is a great movement, the accounts of which have filled the Press in the two hemispheres. I do not think the hon. Gentleman (Sir Gilbert Parker) will tell us again that there are no Free Traders in Canada. To oppose this is really to oppose a tidal wave. It is to oppose a world movement. There are in- dications and proofs that the tide of Protection in the whole world has turned, that its maximum period has passed, and that we are in for a period of tariff reduction all tending in the direction of international Free Trade. This is the most significant movement of our time, and it is significant of the development of commerce in the western world that the two great countries in this great Continent are arriving at a sane and sensible modus vivendi, and it is for us loyally and energetically to second this reasonable and sane arrangement, which will probably be carried into effect by the United States and our great Dominion of Canada.


We are not attacking the agreement proposed to be instituted between the United States and Canada. We are not criticising Canadian statesmen. We are not attempting to interfere. I notice that the whole object of the party opposite from the very first moment that this subject came up in the House has been to try and represent the party to which I belong as desirous of interfering in order that they may make party capital out of it in this country and in Canada above all. We do not interfere and we do not criticise. We regret that certain Steps have not been taken on this side of the water, and we may regret the consequence which it is suggested it will have by its advocates in the United States of America on certain interests which we regard as Imperial. When the Leader of the Opposition on Monday night first mentioned the subject there was a roar of cheers from the other side, as if it was a sort of party victory for them, but it may be a very Parthian victory indeed if the contention is borne out of people whose opinion is as much entitled to be heard, though it does come from this side of the House, that it may seriously affect the future flow of grain to this country through the existing channel. They seem to think that if they can make a party score over this and represent it in Canada it will kill the Tariff Reform movement in this country. That is their whole object. They will not succeed in doing it. We shall press for Imperial Preference all the more if this agreement goes through. If it does, and, as they admit, the stream of trade will be diverted from the present channel, which is East and West, into North and South, we, by Imperial preference, will endeavour to divert it back again into East and West. The attitude of the Labour party is that we cannot speak in the name of the democracy. The hon. Member who spoke in the name of the Labour party said he represented the democracy. Just as much as he does we represent the democracy. Our constituents are entitled to be heard just as much as his. The attitude which they take up, that they alone are to be heard in a matter of grave Imperial import, is a very serious disregard of the rights of a temporary minority, and if it continues it is bound to lower the respect with which opinions from whatever quarter they come are listened to in all parts of the Empire. No doubt this debate and the things which are said in it will be reported in Canada, and they may have some effect. They are conscientious opinions.

But let me come to the points in connection with the Debate which I feel we must bring forward. This agreement does affect British interests. In future Canada and Canadian manufacturers and producers are to be in a more favourable position in the United States market than our manufacturers and our producers. There is a list of things which can go into the United States under specially favourable terms. Can our goods go in under specially favourable terms? Are they going to receive from the United States the same treatment? Is one part of the British Empire to be given one advantage and other parts of the British Empire to be denied that advantage? That is a very serious fact when we consider the Empire as a whole in its relation to the external relations with other great nations and other great Empires and in its relations with foreign politics, and things of that kind. It is a very important point and it is a point which must be realised. Canada in the future is to be indeed the most-favoured nation. The experience of the last ten years shows that as far as we are concerned the most-favoured nation clause might have been torn up for all the good it has done us in the markets of the world. Time after time we have seen foreign countries raise their tariffs against our goods. Is the most favoured nation clause going to do us such an awful lot of good in the markets of Japan? Will it do such an awful lot of good in the United States of America? Why is reciprocity being supported so actively in America, and what are the arguments which are adduced there? I will take first the very remarkable article which appeared from the pen of Mr. Henry Whitley, of Boston, in the "Atlantic Monthly" of October last. He said:— The people of the United States would be glad to join with the people of Canada in developing this great territory, and, as in the case of the territory of the United States, it could be developed to the mutual advantage of all concerned. The question as to the proper division of the customs and internal revenue under a common tariff and under a system of Free Trade between the United States and Canada would not be altogether easy of adjustment, but might in the last resort be left to the decision of arbitrators to be agreed upon beforehand… I am well aware that there would be many difficult questions to settle before the countries could unite on the basis of friendly and unrestricted trade relations. I he fact that is thought by many Canadians to stand absolutely in the way is the preference on certain manufactured articles given by Canada to England. What does Mr. Whitley advocate in this article? He advocates, as they are advocating all through the United States, Free Trade between Canada and the United States and a tariff wall round the North American Continent against Great Britain and against Europe. That is the meaning of this agreement. It is indeed the triumph of Continentalism. It is the triumph of the highest ambitions and the hopes of those American speculators and financiers who hope to divert the trade of Canada to themselves, and to break down that great and valuable system of trade between Canada and the Homeland, and who wish above all to get at the valuable national resources north of the boundary line, as the natural resources of America have been prodigally wasted in many cases by the United States themselves. The Canadian forests, Canadian pulp, and Canadian products are what they want. What is the position unless we are ready to stand by Canada? The great attraction and great advantage to Canada is that at the present moment and for some time to come, for every dollar Canada puts down, the United States can put down ten, and for every man that Canada puts down, the United States can put down ten. We cannot tell at the present moment what effect this treaty will have on the industrial position of the country in the future, but that is the position today. Under these conditions, where you have a big and wealthy country, which is going to obtain the natural resources of another country, under specially favourable terms, and an equally big country with less population and less wealth, I believe the United States will get the best of the bargain. I would like to say a word with respect to the attitude of the United States. When I was in Canada I was shown a very interesting article in the New York "American." It says:— It is time that the discovery be made at Washington and Ottawa that the protective principle has been falsely applied in the building of the tariff stockades across the grand meridian trade routes of North America. The political annexation of Canada may be delayed a little, but commercial annexation is overdue. The House will observe that they do not talk of commercial union; they talk of commercial annexation. That is a very important point to notice. At a later date, an important and significant statement was made as to the attitude of America towards the British Empire. This is from Mr. J. J. Hill, the man who stands probably to gain more by the new agreement than any other man. He says: The union of all parts of the British Empire in a commercial federation is only a question of time. When that shall have been concluded under a system of preferential advantages ensuring the English market to the Colonial producer of raw materials, and the Colonial market to the English manufacturer, it will strike a double blow at the United States. Our best customer—Great Britain—and our third best—Canada—will then trade less and less with us and more and more with each other. It will be permanently impossible for us to repair the error if the present reciprocity agreement is rejected. His view is that the present Ministry are not going to remain in office very long. The statement made by Mr. Hill shows that the Americans recognise in this agreement that by our failure to secure Imperial trade along Imperial lines, they are going to get the great advantages which the development of the trade of Canada offers to anybody who cares to take those advantages by means of a system of reciprocal trade. I admit that it is only a question of time for the United States of America either to materially reduce or altogether abolish the duty on Canadian corn. Their millers want the grain. The quality of Canadian wheat is finer than that grown in any other part of the world. The Americans want that wheat; but we want it more than they do. We have milling capacity sufficient to grind every single ear of wheat required for our population, but we have not the wheat. If we had the wheat, and if we did not import flour, we should find more work for our people here, and we should be sure that we had absolutely purer flour made of blends by the millers of this country. What happens in America in the production of flour? Who knows and who cares what is the composition of American flour? There is much American flour which is harmful, but we import it because it is cheap. There seems to be a belief that everything that is cheap is desirable. Apparently that is the view of hon. Gentlemen opposite. They say: "Buy in the cheapest market."

We heard the hon. Member for Belfast (Mr. Devlin) tell a sorrowful tale yesterday as to the conditions of labour in that city. We heard a sorrowful tale of goods made at 6d. a dozen for this and 10d. a dozen for that, but if you have cheap goods for the mass of the population and cheap luxuries for millionaires, you will have cheap wages for British workers. That is what the Labour party are out to support. Apparently the doctrine is: "Do not divert trade out of its natural channel." I suppose the Prime Minister, if he were a business man, would watch business flowing naturally to his business rivals, and say: "You must not interfere with the natural flow of trade" As it is with individuals so it is with nations. Shall we not at this moment do something to see that the great trade which flows in the British Empire should flow here? The Unionist party advocate one policy. What is your policy for encouraging Imperial development along Imperial lines? The condition is serious indeed at the present moment. Apparently it is thought impossible by hon. Members opposite that there should be such a thing in history as the cornering of wheat in the United States of America. What is to prevent that in the time which is shortly coming when the harvests in the United States will only be just sufficient to satisfy the mouths of the workers in the United States? The amount of wheat grown m the United States and available for exportation is becoming less and less. The population is growing by a million a year, and wheat land is going out of cultivation.

What are they proposing to do by this agreement, and what are they trying to do without it? They are trying to divert the grain of Western Canada into the United States. Is that being done by private enterprise? No, it is being done largely by the ratepayers' money. A large grant has been made by one of the States for the deepening of the Erie Canal, so that grain and other products may be taken down from Canada to the harbours of New York and Boston The result will be that more grain will go to American ports than to Canadian ports. If this agreement goes through, that will be the case even more. Is that a prospect which we can view with absolute equanimity? Can we rely on the good faith of American corn merchants that we shall get grain from Canada on the terms on which we have got it in the past? Often and often the price of wheat in Liverpool has been less than the price of wheat in the United States. Let the House remember that the duty obtained in the United States is four times as much as has ever been proposed by the right hon. Gentleman the Member for West Birmingham. What is the position to-day? In Canada the agreement is advocated because it means a higher price for the Canadian farmer's wheat, while in the United States it is advocated because it will lower the price of food to the consumer. [Laughter.] I am glad that hon. Members opposite realise that we Tariff Reformers are not such Absolute fools as we look. We realise that they think that by the argument I have used they have got us in a dilemma. They think that we go to the British farmer in this country and say that he would get a better price for his corn if our policy were adopted. We do not say that. I ask any hon. Gentleman opposite to produce a leaflet issued, or a statement made, by any responsible member of our party saying that a 2s. duty on foreign wheat will increase the price which the British farmer is going to obtain for his wheat. The whole of the dilemma which they think so ridiculous is one they have created, and for which we are not responsible.

The Amendment moved by my right hon. Friend (Mr. Austen Chamberlain) is not framed to deal with the wider aspects of the question of Fiscal Reform, and with what the effect of that policy might be in relation to the industrial conditions of the country. The Amendment is intended, first and foremost to concentrate the attention of the country upon the advantages which might result to British trade and to our future Imperial relations, politically, commercially, and financially if this country adopted the policy "which we on this side advocate. Will anyone say that there are no Free Traders in Canada now? There are a few. I suppose no one interfered more in my election than the Secretary of the Free Trade Association in Winnipeg. I might take offence at his action and say that it was an unwarrantable interference on the part of Free Trade leaders.

I was in Canada during the time this great Free Trade boom was going on. I was in Winnipeg when that great meeting took place, attended by seventy people out of a population of 150,000. I do not know who organised it. I should think it was this gentleman who interfered with my election. But a movement that is in the direction of lower tariff either with the United States or Canada is not a Free Trade movement. It is a movement in favour of the lowering of tariffs and eventually of Free Trade between the United States and Canada, and not Free Trade for all the countries of the world. If the Free Traders of Canada give Free Trade to the United States, will they open the markets to us? Will they take off the tariffs against our goods? If they will, then it is time for us to rejoice, as hon. Members opposite rejoice, at the conclusion of the treaty establishing Free Trade in many articles between the United States and the first of the British Dominions beyond the seas.


The hon. Gentleman who has just sat down had what I hope he will forgive me for calling the temerity to charge us on this side of the House with using the affairs of Canada in a party sense. I think I can easily refute that charge, and more, I can remind him that what is now happily the leading paper of the Unionist party, this morning castigated His Majesty's Opposition, and gave them a warning which it seems to me has considerably chastened their periods in this Debate. What did we hear in this Debate from the right hon. Gentleman the Leader of the Opposition (Mr. Balfour) only yesterday? We heard that this agreement with which the hon. Member who has just sat down also disagrees, was a great Imperial disaster. What has "The Times" to say to that? "The Times" says this: "To describe it as a deadly blow to our Imperial interests or the cause of Imperialism would be read as implying that those who made the agreement had dealt a blow of that kind." I say that those words were thoroughly deserved, and I hope that the right hon. Gentleman opposite will forgive me for saying that I agree with my right hon. Friend the Member for South Shields (Mr. Russell Rea) in what he said, that a great deal of this Debate, as conducted by hon. Members opposite to-day, has amounted to a criticism of Canada. The hon. Member for Denbigh Boroughs (Mr. Ormsby-Gore) pictures America as a financial and commerical giant, and Canada as a dwarf, trembling in the clutches of this superior economic force. That is a true presentation of what the hon. Member pictures in this House. I say that that is a reflection upon Canadian statesmen, as I shall show presently, when I come to details, that if anybody has gained in this matter it is Canada. I venture to affirm that what is good for Canada is good for the Empire. What is good for Canada is good for us; and hon. Members opposite who intend to follow me in this Debate might reflect in the meantime upon this proposition, that the welfare of Canada and the good of Canada ought to be clearly before us here to-night, in the course of this discussion.

There is something more than the right hon. Gentleman the Leader of the Opposition said, not in this House it is true, but afterwards. The Leader of the Opposition said our duty is to let all those who agree with us on the other side of the Atlantic know that our faith is unwavering and unchanged, and he also said it was the duty of the Opposition to work in sympathy with those who agree with us in the Great Sister State, and to fight to the end. I venture to submit that this is a suggestion of lateral cleavage in the Empire, a suggestion that it is the duty of Conservatists and Unionists in this country who believe in Protection to join hands, not with any opposition which has yet revealed itself, but with any possible opposition in Canada. I have here a report of what took place, the Canadian official Parliamentary Report, which has not been yet referred to in this Debate, for the day on which this agreement was put before the Canadian Parliament. I cannot find in that report any determined opposition on the part of the Opposition in Canada. I hope that, in view of the history of the reciprocity movement in Canada, we shall find that there will be a joining of hands on the other side, and that there will not be any opportunity for the suggestion which has been made in the course of the debate, particularly by the hon. Member, I think for the Camlachie Division (Mr. Mackinder), who made some semi-philosophical reference to man's relation to nature and tariffs, I may remind the House that the whole course of civilisation and of the progress of man has been marked by a struggle with nature, and that what man has really been doing all the time is to avail himself of the highways of nature, and to make fresh highways. The hon. Member was so far removed from the proper conception of that particular point that he invited us to contemplate one of the most magnificent engineering works that have ever been put in hand, that is the cutting of the Panama Canal, which I hope will be completed in 1916, as on all fours with the building of a tariff barrier. He said that it was an investment. It is an investment. What is it an investment in? In cutting through the Isthmus of Panama and making a fresh highway for free trade. He compared a great investment of that kind to an investment in tariffs. Surely there could not possibly be a comparison of things more dissimilar?

Passing to the words of the Amendment itself they run as follows: The House is invited to express its disapprobation of the persistent refusal of His Majesty's Government to modify the fiscal system of the country, which is imperilling the advantages at present derived by British commerce from the preference. I put it to hon. Gentlemen opposite, is it seriously suggested that what I hope they will forgive me for calling the trumpery scheme of tariffs, which they have from time to time put forward would have stood in the way of the present agreement? I must invite them to reflect upon what became of their own proposal. The right hon. Gentleman the Member for West Birmingham (Mr. Joseph Chamberlain), on 6th October, 1903, sketched a scheme for a tariff which I believe had been very carefully considered by him and by others. It amounted to the establishment of a small scale of duties on foreign produce, and it was the cardinal feature of the scheme that all Colonial produce should be free of duty. Now what became of that scheme? It was considered by the right hon. Gentleman's own Tariff Commission under the chairmanship of the right hon. Gentleman the Member for Wimbledon (Mr. Chaplin) and the Agricultural Committee of the Tariff Commission modified the scheme of the right hon. Gentleman the Member for West Birmingham in this important particular. They swept away the idea of free Colonial products, and they put in its place a modified tariff of this kind. Wheat was to be taxed if from foreign sources, at 6d. a cwt., and if from Colonial sources at 3d. a cwt., and so on right through the scale of duties. The hon. Member for one of the Birmingham divisions, speaking, I am sure, with perfect ingenuousness, rejected the idea that his party had suggested the taxation of every kind of food. Of course, it is very difficult for hon. Gentlemen opposite to follow the economic gymnastics of their own leaders. I can quite understand that the Member for Birmingham is not particularly well posted on this particular point. I am sorry he is not in his place, but it may be well to remind the House that the Committee of the Tariff Commission suggested the taxation not only of wheat and flour, and of meat and dairy produce, but also of vegetables and fruit, and they did not exclude Colonial products from that taxation. They only suggested that a lower scale of duty should be arranged with the Colonies by negotiation. I ask hon. Gentlemen opposite to compare that with the terms which Canada is receiving from the United States. Their offer to Canada was a tariff. It was the setting up of a barrier where no barrier now exists. Their offer to Canada was to shut the ports of the United Kingdom, and yet they say it is our conduct that has imperilled Imperial relations. They say it is our fault which has led to the setting up of this particular agreement.

The Truth is that if any Canadian read and understood the tariff that was suggested by the Tariff Committee he would see at once that the only path to the continuance of free trade for Colonial produce in this country was by virtue of the policy which we on this side of the House adopted; and I may remind the House that the "Birmingham Daily Post," which is supposed to be in close touch with the right hon. Gentleman the Member for East Worcestershire (Mr. Austen Chamberlain) on 8th December, 1909, also pointed out that Mr. Chamberlain's proposal to meet the whole of the demands of the Colonies would have to be modified by asking them, the Colonies, to agree to a substantial preference which would not free them from the whole of the duty. So that hon. Gentlemen opposite were not even offering Canada Free Trade. They were offering Canada something less than Free Trade. Yet the hon. Member who has just sat down has the temerity to charge us with making a breach in British and Canadian relations. I may remind the House of the flimsy character of the ties of interest that would have been created by the scheme which was set up. What do these ties amount to? The term "ties of interest" was originated by the right hon. Gentleman the Member for West Birmingham. We have had a more unfortunate term used here to-day by the hon. Member for the Camlachie Division. The hon. Member used the word—I regret it is used—"bribes," in this connection. He talked of the bribes that had been offered. I earnestly hope that the word will never be used in that particular connotation again, either in this House or out of it. To turn to the nature of these ties of interest. If we take the scheme which was originally suggested by the right hon. Gentleman the Member for West Birmingham we find the Colonies stood to get out of that scheme just over £2,000,000, on, to be precise, less than £2,500,000, and that it would cost the British taxpayer nearly £19,000,000. Therefore, if the right hon. Gentleman the Member for East Worcestershire, as Chancellor of the Exchequer, had to frame a scheme to give back to the British taxpayer what this Colonial preference would cost, he would have to find the difference between £19,000,000 and the revenue received at the Treasury on foreign imports, which would be £8,000,000. He would therefore have to find a balance of £11,000,000. He would, of course, to do that have to put, say, 6d. on the Income Tax, or by increasing those land values, which I think does not altogether meet with the approbation of hon. Gentlemen opposite. To the scheme as it presented itself from the business point of view we objected. It was objected that it was a scheme which penalised this country very heavily and did little or nothing for the Colonies, and only too probably might lead to friction in regard to the matter. I would point out that, at any rate, Mr. Fielding has no doubt about who pays the duty. I have here a report of his speech in the Debate on this scheme before the Canadian House of Commons, and one of the advantages he pointed out in connection with it is as follows:—I am reading from the Canadian "Hansard" of Thursday, 26th January, 1911. Mr. Fielding said:— The scheme would result in the reduction of taxation to the Canadian taxpayer amounting to over 2,000,000 dollars. Therefore, even from the point of view of the reduction of the burden on the taxpayer the matter is well worthy of attention. To reduce these duties must involve the reduction of taxation to the Canadian taxpayer, and it shows that Mr. Fielding clearly realised that circumstance. Further criticism of the Amendment before the House leads us to consider the advantages which we at present derive. I am one of those who have always admitted those advantages, though they have not always been admitted by hon. Gentlemen opposite. I remember that the right hon. Member for West Birmingham spoke very plainly about it at the Birmingham Conference in 1902. He then pointed out that their effect was very small, and he used these remarkable words:— We cannot bargain with you for it: we cannot pay for it. These were the words of the right hon. Gentleman himself with regard to the result of Canadian Preference. As a matter of fact, it is clear, at least it is clear in my opinion that there is some stemming of the tide of trade by the process. The facts reveal themselves, in judging of the amount of that stemming. If you take the years before Preference was thought of, the imports into Canada from the United Kingdom were 20,000,000 dollars, and in 1908, the latest year for which I have the figures, the amount had risen to 71,000,000 dollars, an increase of 51,000,000 dollars. That is, of course, a very remarkable increase—255 per cent. In the same period, the imports to Canada from the United States rose from 30,000,000 dollars to 110,000,000 dollars, which is 266 per cent. It does not prove that Preference has been of any use in this country, but it does prove this very clearly, that nature, about which the hon. Gentleman opposite spoke, is a good deal stronger than Preference. By granting the preference the Colonies show themselves free to establish trade relations with other countries, and in particular the United States. I do think that in justice to the position of Canada we ought to realise that the policy of reciprocity in that country is not merely a generation old, it is two generations old. Indeed, there was a reciprocity agreement between Canada and the United States as long ago as 1854, and it remained in force until 1866. Ever since that date, as Mr. Fielding pointed out in the Canadian House of Commons on the 26th of last month, it has been the policy of both parties in Canada to endeavour to reestablish the agreement or the nature of the agreement, which was abrogated in 1866. That was done again and again, and the only reason why the negotiations finally ended was not because Canada wished to end them, but because she found it was of no use going to Washington. As Mr. Fielding pointed out the other day, after all these years of Canada's endeavouring to gain this object, would it not be folly if she were now to forego it. Is not that the best possible proof you can have that this agreement is a good thing for Canada, a matter of real gain for her, and should it not therefore appeal to u s on that ground?

In regard to the question of who gets the advantage in this matter, Mr. Fielding-very properly said that it is not an agreement in which either side can claim a victory. It is an agreement for mutual advantage. It seems to me that we should remember this, namely, that Canada is a small country in point of population, and that America is a very great country. With all due respect to hon. Members who have given us glowing pictures of Canada, and as to its future population, I would beg them to remember that modern population is based not so much on agriculture as on coal, and while it is true that Canada has got extensive coalfields, these are not, on my present information, of a nature which would enable Canada in times to come to sustain as large a population as the United States. Take the facts as they are. Canada at the present time has a population of 8,000,000. The United States has a population of nearly 100,000,000. Most obviously when there is a tariff reduction between two countries with such dissimilar populations in respect of numbers it is most clear that it is the smaller country which will have the larger gain, because the country with a population of 100,000,000 throws open its markets to the smaller country with its population of 8,000,000. It should be remembered further that the United States tariff is very much higher than the Canadian Tariff. That is a part of this agreement which is not thoroughly understood by those who have joined in this Debate. I can tell that from what they have said. I do not claim to have more intelligence than they possess, I only claim to have more information. I believe I am the only man in the House who has a copy of the Canadian "Hansard" containing a report of the debate on this question. The fact is that the United States tariff is so much higher than the Canadian tariff, that a large part of the agreement is concerned with the establishing of a free list between the two countries. It is obvious, therefore, that the United States has had to reduce her duties more than Canada in order to reach the position of zero. It is obvious that Canada cannot be said to have been exploited by the United States. I do not think it is well for hon. Members opposite to reproach Canada for seeking a good market for her produce. "We have not forgotten that in the early days of this controversy the right hon. Member for West Birmingham made an appeal to the Colonies. It was not like the appeal made in the old days when they said: "You shall deal with us, and take our manufactures"; but the appeal, paraphrased, now takes the form: "Do not be too hard on your poor old mother." The last speaker joined in the argument that Canada ought not to have made a bargain with the United States which gave her manufacturers a greater advantage in the market than we possessed. That was the effect, I think, of what the hon. Member said. I am in the recollection of the House. The right hon. Gentleman the Member for East Worcestershire pointed out to the House—I do not complain of it, but he certainly pointed it out in a very significant way—that the American interpretation of the most-favoured-nation clause was such that we should not gain the advantage which the Canadian manufacturers are going to have in the American market. It is perfectly true, but really I do not see why we should assume any dog-in-the-manger attitude in the matter. If Canadian manufacturers get these advantages, let us rejoice. I think, however, something may be said on that head.

I would suggest to the right hon. Gentleman that very possibly this new agreement may be the means of making representation to the United States on this particular point, and that it may have some effect in that direction. Up to the present time the particular interpretation of the most-favoured-nation clause by America has only damnified us in respect of one thing in practice, and that is spirits. This further extension of it in regard to Canada does, I think, give us ground for making representations which happily may lead to a different view being taken of the mostfavoured-nation clause by the United States and may therefore give British manufacturers further advantages in the American market. At any rate the passage of this agreement between these two countries does give us in respect of both of them an opportunity for representation and negotiation which may have very good results in view of the great growth of Free Trade feeling in those countries at the present time. I have examined the list very carefully, and I find that it has to be scanned very closely indeed to find more than two or three cases in which the American manufacturers will enjoy a lower duty in the Canadian markets than we shall enjoy. As a matter of fact the agreement which has been made with America, so far as it concerns manufactures, only gives America part of the intermediate tariff which was known to be the Canadian policy several years ago. So in that respect nothing new has been introduced into the matter. The hon. Member for one of the Birmingham Divisions gave us a quotation from Sir Wilfrid Laurier, which I confess considerably surprised me, and he was at once challenged as to his authority. I think he said he took his quotation from "The Standard." One of my hon Friends has been kind enough to consult the Canadian "Hansard." He did not find the quotation made by the hon. Member, though that, of course, may be due to an error of date, or some other circumstance; but while he was unable to find the quotation in question, he did find this, which I will read. This was said in the Canadian House of Commons on November 21st, when Preference was under discussion, by Sir Wilfrid Laurier:— A great deal will be gained both by Canada and by the British Empire if our relations with the United States are put on a more friendly footing. Surely the spirit of that utterance ought to be very welcome in this House, because, as I ventured to say at the beginning of my observations, the welfare of Canada must be the welfare of the Empire. When it comes to speaking of Imperial ideals surely any proper conception of the nature and Constitution of the British Empire will lead us to the conclusion that the word "empire" is very much misused with regard to a very large part of it, and that the word "federation" ought to be very much more largely used. Our relations with the self-governing Colonies are free relations within the federation, and so far as cherishing any ideals with regard to the future of the Empire and the world is concerned, surely most of us who have thought about this thing will welcome anything that will make for friendlier relations between ourselves and the great Republic of the United States across the Atlantic.

8.0 P.M.

I need not remind hon. Members that it was a matter of taxation which separated us from the United States of America. Let us hope that in time to come it may be written in history that the pulling down of this barrier between Canada and the United States has done something for the reunion of those two peoples, I mean their reunion in such ties which bind us so loosely yet so closely to the daughter nations of the Empire. I shall cherish that conviction, and I shall cherish that ideal with regard to the future development of the British Empire. As has been pointed out by my right hon. Friend the Member for South Shields (Mr. Russell Rea), too strong insistence cannot be placed on this fact, that the origin of this particular agreement has arisen out of a great Free Trade movement in Canada and the United States. It is not true, happily, that since the days, the evil days as we regard them, of Protection, that Protection has gained strength in the world. The very reverse is the case. If anyone will examine the constitution of tariffs and tariff barriers of the world at the present time they will come to the conclusion that not less Free Trade, but very much more Free Trade, has been gained to the world as a whole since the days when we repealed the Corn Laws. The sweeping away, or partial abrogation, of the artificial tariff line between Canada and the United States will, I hope, in time to come be regarded as one of the greatest and one of the best movements towards universal Free Trade which the world has ever seen.


The main feature of the speech of the hon. Member (Mr. Chiozza Money), so far as we on these Benches are concerned, is the accusation that we are blaming Canada for looking after herself. I suggest that in all the speeches that have been given from these Benches there is not one that has had for its purpose that of blaming Canada for looking after her own interests. Where we do lay the blame in this Debate is, not against Canada, but against hon. Members opposite for depriving us in this country, our industries, and our people, of those benefits which the hon. Member has perfectly rightly said, and we agree, that Canada and the United States will mutually obtain one from the other. To us who ardently believe in the necessity of a tariff in this country, the very fact that a treaty of this nature has been negotiated fills us with some anxiety as to whether those dangers, to which we have never tired of drawing the attention of the people of this country, will not be so increased and made impossible to retrieve, before we come to realise that we cannot stand alone against all the countries of the world as long as they keep tariff systems in operation against us. We particularly have to regard it rather as a warning of the dangers that we believe, rightly or wrongly, will beset the future of this country.

There are three fundamental principles underlying that aspect of the matter, and we must consider the principles of this treaty on the assumption that it may be followed either in Canada or in other parts of the Empire by similar treaties with foreign countries. We have got to deal with it first as it may affect the course of British trade in itself. In the second place we are bound to consider how it is likely to affect the food supply of the people of this country, because we are in a position that no other country in the world is in with regard to that question. We, in these small islands with a large population, dependent as we are for over-seas commerce to keep people going, first as producers and second to enable them to be prosperous consumers, and dependent as we are upon the overseas supply of food, we can afford, less than any other country, to make a mistake on this most important matter concerning the happiness and prosperity of our people. The third point is the effect that this treaty is likely to have on the future of our Empire. I will not say anything further on the question of food supply, as it has been dealt with at considerable length by previous speakers. When I heard the hon. Member for Denbigh jeered at by hon. Members opposite for saying that we had not held out to farmers in the United Kingdom the hope that Tariff Reform was going to have the effect of giving them higher prices for their corn, I may remind the House of this fact, that the hon. Baronet the Secretary for Agriculture last August, at Magna Regis, addressed a body of farmers at a local agricultural show. He complimented them on the excellence of their exhibits, particularly in the cheese and butter section, and he hoped that prices would at least be maintained, if not increased. I think it is just as well when we are fighting, unfortunately, in this set party spirit, as we are doing during the whole of this Debate, to remember that those people who try to set themselves up as to the great protectors of cheap food for our people produce men of responsibility from the Front Bench opposite who deliberately, when it suits their purpose, tell the fanners that they hope prices will be maintained, if not increased.

I desire to deal particularly with the effect that treaties of this nature may be expected to have upon the course of British trade. Hon. Members opposite, and the Press which supports them in this country, have eulogised this particular treaty as being a triumph for Free Trade. The hon. Member for South Shields claimed that it was a great triumph for Free Trade. Perhaps it may occasion a little surprise on these Benches when I say that the hon. Member for South Shields is, in my opinion, absolutely right when he states that this treaty is a triumph for Free Trade. But what I want to ask the House is this, is it a triumph for the free import system that we are living under in this country. It is a triumph for Free Trade in Canada and the United States, because it has had the effect, or will presumably have the effect, of reducing the barriers that one country has set against the other. The day that hon. Members opposite can show this country that under their system of free imports they have the means of breaking down those ever-increasing barriers in different countries and in all the Nations throughout the world against British commerce, then I say that the case that we are continually putting before the people in favour of Tariff Reform would fall to the ground. But we know full well that the system makes it utterly impossible for them to do what they are eulogising Canada and the United States for doing at the present moment. There is nothing we in this country want more at the present moment than to find some means, more efficient and more effective than we have at the present time, for setting more free the general course of British trade, by opening out opportunities for the disposal of increased products of our industries, and of our working people in this country. Speaking of the course of British trade, it is perhaps as well to remind the advocates of the free import system that one of the many principles that Cobden himself laid down when he introduced Free Trade was to set more free the course of trade and to give a stimulus to the demand for labour both in the agricultural and in the manufacturing districts. I go from that to an incident which happened in this House fifty-one years ago, and is not without some particular interest at present, when from the box opposite the late Mr. Gladstone, as Chancellor of the Exchequer, in a speech, which I believe lasted for four and a half hours, in introducing his financial statement he dealt with the French Treaty he was then inaugurating, and spoke at considerable length as to the taking off of duties on most articles of manufacture, which the House will remember he did on that occasion, and particularly the Paper Duties. The late Mr. Gladstone in that speech made some very appropriate remarks on the question of the course of British trade. He was. speaking about giving relief to the labouring classes, and he said:— I do not hesitate to say that it is a mistake to suppose that the best methods of giving relief to the labouring classes is simply to operate upon the articles consumed by them. If you want to do them the maximum of good, you should rather operate upon the articles which give them the maximum of employment. It is that you have set free the general course of trade, it is that you have put in action the process that gives them the widest field and the highest rate of remuneration for their labour. I heartily commend to hon. Members opposite "Hansard," volume 222, where they can read a good deal more than I have given them from that speech. I do ask hon. Members opposite, I ask the Government in particular, to point to anything they are doing now or have done during the past five years, with the exception of the Patents Act, which is calculated to set more free the course of British trade for British products. I would in passing remind the House of a very instructive piece of information upon this subject of Colonial treaties which is to be found in the Canada and West Indies Royal Commission Report, published not long ago, when Lord Islington made the following observations: The question which overshadows all others in importance, is that of putting the prosperity of the West Indies on a secure footing, and it can hardly be doubted that this end would be furthered by drawing those Colonies into closer relation with a member of the Empire as wealthy, powerful and patriotic as Canada. Can this be done without an exchange of tariff concessions? Whilst in no way underrating the value of other methods, I am of opinion that the inclusion of reciprocal arrangements is essential to such a scheme. The main object that Lord Islington had in making that demand was to set more free the course of trade between Canada and the West Indies, and hon. Members opposite ought to follow Cobden and Gladstone in that very proper principle. Seeing that all other countries in the world have tariffs which are ever getting higher, you cannot hope to see the course of British trade made more easy and more free. You must anticipate the reverse. That is the effect which treaties of the nature we are discussing to-night are calculated to have upon the future of British industry and labour.

I wish to take a particular case which has a great bearing upon the Amendment before the House and on the remarks of the right hon. Member for South Shields, with reference to the cost to this country of devising means for giving preferential or reciprocal terms to our colonies. I turn to an article in the treaty which will have a considerable effect upon British trade, and which I believe is one of the main objects of the United States in entering into the arrangement. It is in reference to the tin-plate industry. According to the information we have, tin-plates, like barbed-wire and wire netting, are to enter Canada free of duty. The tin-plate industry is of special interest when we are discussing the question of Tariff Reform and free imports. In 1892 the M'Kinley Tariff put a duty of 1 1–5d. per pound on tin-plates entering the United States. In 1890 the United States were producing no tin-plates. In 1893 they started with 18,000 tons, and have gone on steadily up to 515,000 tons. On the other hand, the imports of tin-plates into the United States, in proportion as they have produced for themselves, have decreased from 280,000 tons in 1893. to 62,000 tons in 1908. It might be suggested that that is not the main consideration in discussing the advantages, or otherwise, of the action of the United States, unless we take into consideration the effect of this absolute protection upon the price of tin-plates to manufacturers in the United States. Since that duty was imposed, tin-plates have never been dearer in the United States than they were previously. The right hon. Member for South Shields spoke about the nefarious effects of tariffs in raising prices and creating difficulties for our own people and, presumably, for the working classes. I may remind hon. Members below the Gangway of a very interesting fact. Mr. John Williams, secretary to the Amalgamated Association of Iron, Steel, and Tin Workers, in giving evidence before the Tariff Revision Committee at Washington, in November, 1908, is officially reported to have said:— All we want is the continuance of Protection. It is owing to Protection that we have been able to build up our tin industry and to give employment to many thousands of men at wages aggregating £2,000,000. An average of 21s. per week more per man than in Wales. Mr. Williams said that he was a democrat, that he had voted for Mr. Bryan, but that he knew what the working-man owed to Protection. That is an official statement of the effect on an industry where you can follow the statistics right through, which conclusively proves that by a judicious use of tariffs you can enormously benefit the working classes of the country, and that there is no justification for the bogey which is for ever being set up before the people of this country—namely, that tariffs only hit the working people, and that duties are paid in every case by the consumer. I am reminded of an extremely interesting speech delivered by the Foreign Secretary on 22nd March last at Queen's Hall on the subject of Free Trade. The right hon. Gentleman was dealing with the prosperity of Germany. I cannot find that he ever questioned Germany's great prosperity, or that of her working classes; but he gave three reasons why Germany was so prosperous. The first was the close proximity of European markets to her borders. He presumably forgot for the moment that transit by water is invariably cheaper than transit by rail.


Whatever the conditions?


I am speaking of general conditions. What I mean is that the markets of Eastern Russia, Southern Russia, Austria, the Balkans, Italy, Spain, Portugal, and France are as near to the manufacturers of the United Kingdom as they are to the people of Germany. Another reason given by the right hon. Gentleman was the scientific training which we know is a very worthy feature of Germany's policy. But the reason I wish particularly to refer to was the statement of the Foreign Secretary that the prosperity of Germany was very largely due to the intelligent ability of the German people for organisation. We know from experience that that statement is absolutely true. It is so true that the present Government are to-day and have in past years been busy copying the results of this remarkable organisation of the German State in such directions as housing, education, State insurance, old-age pensions, and so on. But, as so often happens with hon. Members opposite when they are discussing the "pros and cons" of the free import system, it never occurred to the Foreign Secretary to suggest to his audience that one of the main features of the organisation which has made Germany great was her ability, as a State, in the organisation of industries and labour in her country. That is nothing more or less than a tariff system. It is only, or principally, by means of tariffs that you can organise industries and labour by the State, and what Germany has done in that direction we can do. I have just given an instance of it in the tinplate trade of America, where a tariff has worked so beneficially for the workpeople, the Trade Unionists of that country. Hon. Members opposite, if they will only apply themselves honestly and apart from party politics, can do the same for the working people of this country. I would like to have given another instance of a similar nature, but I will only mention it in passing. I mention it because, like the iron trade, it is one of very considerable interest to the Constituency which I have the honour to represent. I refer to the leather industry. I have got a good deal of information I should like to put before the House; but I do want to point this out; that to take, for instance, saddlery and harness, the exports of these are not rapidly, but slightly, on the decrease year by year. The curious fact is that out of about £500,000 worth of exports of saddlery and harness from the United Kingdom, the whole of Europe and the United States put together only take £80,000 worth. The bulk of the rest goes to neutral markets and to our Colonies. If you will take manufactured leather goods generally you will find we are relying more and more upon our exports to Colonial markets. When we had a Preference with Canada the exports in manufactured saddlery and harness that was going to that country was on the downward grade year after year. After protection was offered this country—as we all know was the case with general merchandise from Britain—saddlery and harness exports from Britain to Canada went up. Another point I want to mention in a general sense with regard to manufactured leather, excepting boots and belting, is that under our free import system which is said to be so magnificent for the people of this country, and, presumably, so bad for every other country in the world—we are importing two and a half times more manufactured leather goods than what we, under our free import system, are able to send to other countries in the world, including our Colonies. Surely there is a lesson to be drawn from this! If the case of hon. Members opposite does not justly support the desire of Cobden, Gladstone, and others for extending and setting more free the cause of British trade, I am afraid when you go and tell the country that in plain language you will have short shrift with them One other matter. Naturally, in this question of Colonial Preference, and, speaking in a general sense, sentiment, we all know, plays a very large part. Hon. Members opposite have claimed over and over in their speeches throughout the country that sentiment alone is sufficient to keep the Empire united, as we desire to see it united to the Mother-country. What I must point out to the House is that in the case of the United States, we have the President at Buffalo, in the last week in January, making a speech in which he spoke of the:— geographical proximity, close relation in blood, common sympathies, and the identical moral and social interests of the two countries," and "our common traditions and aspirations. Yet he admitted, and we have told the country over and over again in advocating Colonial Preference, that ties of sympathy and blood, and geographical proximity, are not in the case of our Colonies able to hold us together any more than they have been able to bring together more intimately countries like Canada and the United States. In this case it has been found necessary to carry out that natural ideal on the part of the American people, and to adopt what we are advocating, a commercial bond to cement these sentiments.

I realise as much as anyone how useless it is to appeal for a matter of this nature to be dealt with apart from the party system. We know perfectly well how everybody in this House is going to vote when the Amendment is put. But whatever be the merits of one side of the House or the other in this Debate, in this great question of Tariff and Colonial Preference, I do suggest that our responsibility to those that we are sent here to represent, we in whom the future destinies of the country are placed at the present time, should make us realise that the time has come when for the sake of our people and our country we ought to put practice before theory and nation before party.


One has been unable to free oneself from the sense of the unreality of this Debate. The right hon. Gentleman the member for East Worcestershire spoke under apparent difficulties which made one feel great sympathy with him. How is it possible that a Member of either side can fail to realise that it must be a sound policy which promotes the free interchange of natural products between Canada and the United States of America, and that any arrangement which also embodies the taking down to any extent of the tariff walls in regard to other goods must also be to the mutual advantage of those two countries? The position generally that if His Majesty's Government had carried through a preferential system with our Colonies, as advocated by them, that then this agreement between Canada and the United States would not have taken place, is, in my judgment, the very opposite of what would have taken place. Suppose for a moment that by a system of Colonial Preference we had given Canada a bounty of 2s. per quarter on corn so sent to this country, the effect of that would have been that it would have tended to cause more and more Canadian wheat to come to the British market. Then the 92,000,000 of people in the United States would realise that with their rapidly increasing population and their inability to increase to any extent their wheat-growing they must soon require of parties outside the United States the wheat supplies that they need. Under these circumstances it is only reasonable to suppose that when they regarded more favourably the Canadian wheat producers trade in this country the United States would be still more ready to take off their duties against Canadian wheat entering their States even than they are under present conditions; when all we can give to Canada is a free market for the produce she has to send to us. What are the present trade relations between this country and Canada? Hon. Members have spoken as if we were treating Canada badly. Why we have given to Canada for generations the only free market she has got in the world for her wheat and other products, and that notwithstanding the fact that though she takes off a rebate from the import duties she still puts an average duty of nearly 30 per cent. upon the £13,000,000 of manufactured goods we send to her. Thus Canadian preference puts £2,600,000 per year tax upon our manufactured goods entering Canada, plus 1,500,000 dollars bounty to her manufactures of iron and steel and otherwise to enable them to produce. Then again, we give her the protection of our enormous naval forces without asking her to contribute one farthing towards their building or maintenance. [HON. MEMBERS: "Oh, oh."] Practically not one farthing. I know, of course, she is now considering the advisability of building her own fleet, but in the past she did not contribute one farthing towards the British Navy.

Canada is enjoying immense benefits in her trade with the Mother Country, and the Liberal policy of allowing her to make her own fiscal relations as she thinks best to her advantage is the true policy of promoting the strength and union of the British Empire. Personally, it is with the deepest regret I heard the speeches made upon the other side of the House, which, if they mean anything at all, mean that those who make them are taking steps to assist the party in Canada opposed to the reciprocity arrangement between Canada and the United States, and no matter how Gentlemen opposite may protest that they are not criticising Canada, or questioning the right of Canada, to make her own Fiscal arrangements, it is certain that many of these speeches will be interpreted in Canada as a reflection upon the loyalty and friendliness of the Canadians to the Mother Country and a desire to weaken the trade between the Mother Country and her Colonies. The United States taxes against Canada stands at 48 per cent. Canada taxes the United States trade at 24 per cent., and I welcome any change made in the interest of our fellow kinsmen in the great Canadian Dominion that will promote their prosperity. I do not grudge the farmers of Canada that they should have open to them a second door for their farming, their dairy and other' produce, and I believe that what conduces to the prosperity of Canada and the United States of America is bound also to conduce in one way or another to the prosperity of this nation of ours at home.

When hon. Members opposite would have us conclude a preferential arrangement with the Colonies, by putting a duty of 2s. per quarter upon wheat coming to us from Russia and Argentina, they advocate a most unsound policy. They tell us the United States will soon have to buy wheat supplies from outside her own borders. That being so, is it not all the more necessary to us that we should draw wheat supplies from other markets in the world. But more than that, we send our ships out to Russia and Argentina loaded with coal, and we bring back wheat in exchange. We sent last year to Russia and Argentina no less than 6,000,000 tons of coal, and provided work for 40,000 men in the coal mines of this country, and I say, so far as the trade which is the great staple trade in the Constituency that I have the honour to represent, is concerned, there is everything to be gained by adherence to our system of free imports of every sort and kind into this country, and by refusing for one moment to entertain the question of initiating any scheme of Colonial Preference such as advocated by hon. Members opposite. This seems, as it were, a sort of fizzled out Debate on Colonial Preference. The emptiness of the House and the whole tone of the Debate and the forced manner of some of the speakers opposite, trying to "work themselves up into a more emphatic state of mind, surrounded by an air of unreality, makes one feel that this Colonial Preference policy which has been debated now for years past is coming to a close, and as has been said, by more than one of the more influential papers, representing the Tory cause in this country. Colonial Preference is practically dead and buried.


This is the first occasion on which I have had the opportunity of speaking in this House, and I therefore beg the indulgence of hon. Members in the remarks that I am about to make. It has been admitted on all sides that Canada has for years desired a reciprocal treaty with the United States, and as one who has often been taken by business into the United States, and also into Canada, I know something as to why a reciprocal treaty was not concluded at an earlier date. It was because the people of the United States would not offer what the Canadians felt were just or good terms. Many reasons have been given in this House as to why the change has now come about, and why the United States have now come as suppliants to Canada rather than Canada going as suppliants to Washington. I maintain that the reason is what was stated in this House, that such men as Mr. J. J. Hill, the great railway magnate of the West, had foreseen what the effect of Colonial Preference would be if consummated. It would have two evil effects on the trade of America. It would rather curtail the export of American supplies to the United Kingdom, and it would also retard the export of manufactured goods from the United States to Canada. He foresaw what would happen with Colonial preference, and, I maintain, that it is the arguments of the Unionist Party in this country that has brought about the issue we are debating to-night. United States statesmen have, with a foresight we all know they possess, foreseen what is coming. I claim that this is an object lesson as to what can be done by this country as soon as we get Colonial Preference established. If that was sufficient to break down the tariff wall in America surely we can do the same, and then other nations will approach us with that friendly feeling with which the United States approached Canada. The Americans accepted terms with Canada without any bargain, and the time spent over this matter in Washington was ridiculously small. As soon as this Empire is consolidated in Colonial preference the weight which we shall possess in the trade of the world will be such that other nations will come and offer to do what the United States has now done, that is, take down some of the tariff walls which operate against our operatives and our people. That, surely, is one of the great objects the Tariff Reform League has in view. I hate prohibitive tariffs as much as hon. Gentlemen opposite, and I have always advocated that the policy we should follow should be persuasive to induce other nations to reduce their tariffs by making it possible and easy for them to come in, not only to a Zollverein but to an international understanding, that the man who gives shall receive. I believe that the object lesson we have debated here to-day is one which, if we only have the national strength to go forward and secure Colonial preference with Australia and South Africa and New Zealand as well as with Canada, we shall find other nations will make terms with us, and we shall get a nearer approach to free trade than we have ever seen during the past fifty years. I trust we shall see this Amendment carried, and secure a response on the part of hon. Members to the great ideal of Colonial preference. It has been said that our proposals are utterly irreconcilable for unity. I claim, and Tariff reformers claim, that we are not going to make treaties with our Colonies. We are going to say to them, "all the products of your soil and your mines shall enter this country free; all we ask is that in the taxes you put upon imports we shall enjoy a preference." Against the nations of the world who do not give us most-favoured-nation treatment, or give it us only in name and not in reality, we would put a low rate of duty; but against those who put prohibitive duties upon our products we would say, "You can have the low schedule as soon as you see your way to accept our products on reasonable terms." It is a reasonable basis we wish to establish between all nations such as would safeguard the wages of our people, and would not be sufficiently high to create trusts and monopolies. I believe such a thing is possible. The last speaker seemed to think the deathknell of Tariff Reform had been sounded. Let him understand that we shall go on working for and advocating the policy that this Amendment voices.

9.0 P.M.


I am sure I shall be voicing the opinion of all present in the House when I express appreciation of the speech to which we have just listened. I wish to comment on one or two remarks which the hon. Member made before I turn to the question of the reciprocity agreement between Canada and America. The hon. Member seems to be under the impression that the reason the United States consented to overtures from Canada is that some speeches have recently been made by an eminent gentleman in America, Mr. J. J. Hill. I disagree with the hon. Member on that point. The real reason why the United States Government entered into this reciprocity agreement with Canada is the very significant fact that the Democratic party, pledged to Free Trade, has just won a triumphant victory. Consequently, American statesmen have hastened to put themselves in line with the expressed view of the American people, and they are taking the most effective means in their power to reduce the cost of living. Of course, the first step was to take away the tariff barrier between Canada and the United States, and thereby allow the food of the people to be obtained at a lower cost than would be the case if there was no tariff. The hon. Member seemed to think that the efforts of Tariff Reform in this country had something to do with hastening American statesmen to enter into this agreement. I should have thought that a trumpet call which had been smothered by threee successive defeats at three general elections would not have been chosen by any party to revive what we believe to be the dying—if not already dead—cause of Tariff Reform. In addition to that, judging from the speeches delivered on the other side, we are entering upon a cycle of depression in trade, and this has been accompanied by lamentations about our position in the markets of the world. The fact is, we have just had a year which is a record for British trade in all departments. I do not know which to admire most, the courage with which they still nail their flag to the mast of a sinking ship, or the complete indifference with which they blind their eyes to most obvious facts. The speech of the right hon. Gentleman the Member for East Worcestershire mainly rested upon the proposition that our hope of maintaining our trade relationship with Canada under satisfactory conditions depended upon our adopting some artificial means. That seems to me to be entirely against the whole principle upon which our Empire has been founded and developed. What has happened with regard to the development of the British Empire has been this. We have steadily and persistently pursued the line of leaving the component parts of the British Empire to develop themselves without artificial assistance from this country; so that the men we sent there might take advantage of the natural conditions in which they found themselves. It is because of our non-interference with them, and because we made Canada self-governing, that Canada now is one of the greatest of the new countries of the world. It is because we gave self-government to Australia and to New Zealand and to all the other self-governing Colonies of the Empire, that they are so flourishing. Our real objection is that the proposition which emanates from the party opposite with regard to Canada and Australia is to go back upon all that, and to set up once again these artificial barriers in the place of that free relationship between the sister countries of ours which has made the British nation what it is. Natural forces have asserted themselves, as between Canada and the United States, and not all our preference in the wide world would prevent that sooner or later, and sooner rather than later, taking place. Let us suppose for a moment that the party opposite had come into power, and had carried out their reciprocal arrangement with regard to Preference. America simply enters into this new arrangement because she is forced to do so by the clamour and cries of her population asking for and demanding cheaper food. America would not for one moment consider the relations between this country and Canada. What America would consider would be the needs of her own country, and down would go that tariff wall. As has already been admitted by an hon. Gentleman opposite, who comes from Canada, writing to one of the papers:— Sooner or later, if I am rightly quoting him, the United States would have freed wheat and timber of all taxes tending to shut them out of the country. Where should we be then? If we wished to keep up our preference in favour of Canada, of course, we should have to raise it, and, if we raised the preference, we should raise the tax, because the preference is a tax. The higher you raised the tax the higher would go the price of wheat, and the higher the price of wheat the dearer the price of bread. That would have been the result if Gentlemen opposite had been in power and had carried out their policy. The United States are compelled by their own needs to do what they have now done, and that would have been the position if the hon. Gentlemen opposite had the power to carry out their policy. "The Times," which usually represents the policy of hon. Gentlemen opposite, said the other day:— There has probably never been a time when Canada would have rejected such terms as have now been offered by Mr. Taft's Administration. It is not the Canadian attitude which has changed, but the attitude of the United States. That is the point, and they have adopted their attitude to suit themselves and no one else. And we should be the last to believe that Canada's acceptance of the American terms implies any weakening of the allegiance to the Imperial idea. That admission, a very proper and very creditable one, has been more than amply corroborated by what Mr. Fielding said not more than two days ago. He said:— It is no new policy. That point has been already amply dealt with. It is no new policy at all which has been carried out. Quite apart from the preference which Canada now gives to this country, they have been steadily, sedulously, for over fifty years, seeking such a reciprocal treaty they now have from the United States, and they are now only realising the desire of their people for generations passed. Sir Wilfrid Laurier's recent remarks are within the memory of us all. He referred to the shining example of Great Britain, and this now is one of the first steps in following that example. Sir Wilfrid Laurier in the Albert Hall on 18th April, 1907, said:— If preference for preference were not given, however, their loyalty would remain the same. The courageous ancient Gauls were afraid of only one thing and that was of the canopy of heaven falling. Those who entertain a doubt of the loyalty of Canada might just as well fear a fall of the blue vault of heaven. The future of the British Empire was absolutely secure so long as it rested upon the complete and untrammelled autonomy of all its component parts. You can search the whole range of declarations of Canadian statesmen, and with one accord they all condemn most strongly that we are in some way or other going to lose the Canadian loyalty on our preference. Not at all. Whatever happens the British preference is safe. I for one most heartily welcome the treaty. I hope it will be ratified, and will very speedily be confirmed by the votes of both people. The fact is that Gentlemen on the other side are committed to fighting a policy against the whole world, and no amount of fact or platform argument will tell against them. Go where you like, all over the civilised world with whom you trade, the mass of people are in revolt against the high cost of living brought about by high tariffs. Austria shows it; Italy shows it; France shows it; wherever you go you find it. The position is this: No matter what the arguments of hon. Gentlemen opposite may be, Free Trade is becoming the firm belief of the democracies of the world, and the shining example of the United Kingdom will, sooner rather than later, be accepted as the commercial policy of all civilised peoples.


I think it must be admitted that the final remarks of the last speaker were extremely sweeping, and it would be well for him, when he talks about the democracy deserting the policy of Tariff Reform, to consult the Prime Minister of Australia when he comes over to this country for the approaching Imperial Conference. If the hon. Member will discuss the question with people from across the seas, he will find that the Colonies are absolutely true to the policy of the tariff. We have just heard from an hon. Gentleman opposite that the agreement between the United States and Canada is a Free Trade agreement. Very well, it may be so, but it will build a tariff wall around the United States and Canada exactly on the same lines as we have desired to see in an Empire Free Trade, with a tariff wall against the rest of the world. The most interesting admission we have had this evening has been that by the hon. Member for South Shields, that the advantages of mutual preference would be great to this country, and that his only objection is that it would increase the cost of living. I hope before I sit down to be able to prove that that is an exploded idea which this House should not for one moment seriously consider. The hon. Member for Glamorganshire, who spoke on behalf of the Labour party, told us that the sole and only issue in the last three elections had been that of Tariff Reform, and his remarks were endorsed by the President of, the Board of Trade, who told us that, at any rate, it was the chief question discussed. This, it will be admitted, is very important, because when we come in to this House to discuss the constitutional question, we shall be able to say that it was not an issue at any of the three last elections.


It was not an issue at all.


I quite agree. The people did not understand it. We were told also by the hon. Member who professed to speak for the democracy of the country that they would never have a reform of the tariff. I venture to think when the Liberal and Unionist forces in this House are so nearly equal it is rather an extraordinary thing to assert that the party opposite alone represent the democracy. If the hon. Member will only come to some of the constituencies in the South of England I think he will find there a democracy which speaks quite as keenly on the other side on this Imperial question. The hon. Member told us that there were 4½ millions of unemployed in the United States. I do not know where he got his figures, but I must say I think they are absolutely and entirely incorrect. But even supposing that they are not incorrect, it only means that in the United States they have got four years' emigrants unemployed; therefore, one cannot adduce that as an argument against the fiscal system, because that system may not have absorbed the enormous number of people coming into the United States. The flower of our race are being driven to the United States and other Colonies by our present system. I think the hon. Member will have to admit that the figures he has mentioned in his speech are an extraordinary and extravagant estimate.

The reason I intervened in this Debate this evening is to be found in Imperialist rather than in party grounds. I am glad that hon. Members opposite on the Labour benches cheer that statement. It is proof that they realise that there can be questions which are greater than party questions, and I hope they will look at this question not from the party standpoint, but from the point of view of the Empire as a whole. My own opinion is that the agreement between the United States and Canada, from an Imperial standpoint, is a disastrous one. I do not believe the disaster to be irreparable, and if only hon. Gentlemen opposite will put Empire before party we may still hope for a favourable issue. I take exception to the suggestion that we are criticising the Canadian attitude. I think my right hon. Friend the Member for East Worcestershire made it perfectly clear in his speech that he was saying nothing against our kinsmen in Canada. At the same time it must be remembered that Canada is part of the British Empire, and that we are all equally interested in what happens in regard to the great trade question. We do not blame Canada. We blame the present Government for the stupendous folly which has led to the present situation in allowing the treasures of the future to slip from the hands of the nation. I do not say that the Unionist party are quite free from blame in regard to this question. I think they hesitated far too long before they realised the difficulty. I think they were wrong when they remitted the 1s. duty on foreign corn, but there is no excuse for the action of right hon. Gentlemen opposite, which has resulted in the present situation. I make bold to say that with the home supply free and the Colonial supply free there is no possibility of the price of corn being raised by a single brass fathing. Personally, having had some nine years in the corn trade of this country, I have never hesitated to believe that unless we adopted the policy of Imperial Preference we should not keep the price of wheat down in the future. It has always seemed to me an elementary point of business that if we stimulated the supply of wheat in the Colonies there would be more wheat grown and more wheat on the market of the world, with the consequence that the price of wheat must be kept down. I should have thought that that was understood by anybody with any business experience. On the other hand, when you consider this treaty there must be a greater drag on the Canadian wheat supply from the constant call of the United States market, and the consequence is that America, as time goes on, must forestall more and more of the Canadian wheat which is coming into this country now. The result will be that wheat which comes from Canada to this country will be dearer. That, I think, will not be denied by any hon. Gentleman opposite. The wheat of all the Colonies will be dearer, owing to this policy, and owing to the fact that we hesitated to establish personal or reciprocal relations with the Colonies by a small duty on corn, and thus, to give to the Colonials the amount of the difference in the freight between Canada and the closer countries of the world. I think we have to consider whether inter-Imperial trade is really an advantage to this country, and on this point I do not think I can do better than quote the Chancellor of the Exchequer. I think it will be admitted—I say it with all respect—that he is one of the brightest of the Members of the party opposite, and he said:— The Umpire would be a great gainer if much of the products now purchased from foreign countries could be produced and purchased within the Empire. That is a good enough reason for fostering trade within the British Empire if the British Empire is going to be a great gainer by it. Look over the water. Sir Wilfrid Laurier, in 1904, said in effect, we are ready to make with you a treaty of trade. The Government of Canada, he said, is ready and has declared its intention and readiness to go on and extend the British Preference as soon as the British people extend to us a corresponding preference. The answer is no longer in our hands, but in the hands of the British people, and there the matter stands. They were, I think, very important words, coming from the head of the State of Canada, but take Mr. Fielding himself, the Finance Minister. He said there is a way of doing more; there is preference by mutual trade, and that is what we had in view when we adopted in 1902 the resolution of that year. There is a way of doing it; it is by adopting a mutual system of Preference, and this is the way in which the trade of the Empire was to be made more satisfactory, and this is expressed in his deliberate speech at the Imperial Conference. The Chancellor of the Exchequer believes that there would be a great gain by the increase of our trade, and Sir Wilfrid Laurier expressed the opinion that we must draw closer together or else we shall drift apart, and that is the opinion of any statesman of any repute in Canada. We have to consider that this question not only affects this country or Canada, but affects Australia, South Africa, and New Zealand, because they also have tendered us a trade preference in the past, and also are ready to extend a preference in the future, and once more at the recent Colonial Conference, with extreme unanimity, all the chosen representatives of the Dominions who came to this country again repeated their offer of an increased preference if we would extend the principle to them.

In what spirit were they met? They were met in the spirit with which we are all familiar. Our statesmen deliberately and with glee banged, barred, and bolted the door against Colonial Preference, and at the same time they banged, bolted, and barred the door of many working-men's cottages against the increase of wages which would come from within the Empire. [Laughter.] Hon. Gentlemen laugh, but I would point out that the President of the Board of Trade in answer to me, said that our export trade with Canada has increased this last year to the very big figure of nineteen millions. Considering that it had dropped to a little below five millions before the preference was given, that was an enormous figure, and but for that preference we should not have had the fourteen millions extra trade. [An HON. MEMBER: "Why?"] Because the trade was going down every year until the preference was given. [HON. MEMBERS: "No."] Hon. Members who say no, can get up and prove that I am wrong, but those were the figures that were given to me by the President of the Board of Trade, and I venture to think that his figures are right, and not those of hon. Gentlemen opposite. I think if you will consider this increase of trade you will see that our trade has risen from five millions to nineteen millions, and I want to ask the hon. Member for Stoke-on-Trent (Mr. John Ward) whether that would not have meant at least 50 per cent. in wages, and if so, he will find that at least seven millions extra wages to the working men of this country is directly due to this preference which our Canadian brothers have given to us without any accompanying gift on our part. I venture to think when we come to consider the policy in that light it takes a different aspect, and personally I think it is essential from every point of view that the Empire should be more closely knitted together. I appeal to hon. Gentlemen opposite whose one desire is to benefit the working man of this country, that if our trade with Canada on its present population is nineteen millions, and if before the end of the century she will have a population of eighty millions, it will not be a matter of regret to this country that she passed by this preference agreement which all the other countries of the world are willing to make while the Mother Country alone, who would receive all the benefits of the preference, has held back from it. An hon. Gentleman who spoke quite recently on those benches, stated that we treated Canada so well and Canada treated us so badly, by putting a tariff upon us. But we do not treat Canada well, we give her exactly the same terms as the foreigner, who is without our gates. Canada, on the other hand, has given us 33⅓ per cent. Preference, and stated that she will increase that Preference if we will give her reciprocal treatment. Canadians of all parties, whether Liberals or Conservatives, tell us that the treaty with America would never have been brought about if we had established this policy of mutual preference from this end of the Empire. [HON. MEMBERS: "No."] All of them, I think. At least Sir Wilfrid Laurier has said so. [HON. MEMBERS: "When?"] I think it was Sir Wilfrid Laurier who said so in the Dominion, House. If hon. Gentlemen will prove that I am wrong, I am perfectly ready to withdraw, but I believe it is absolutely a fact which will be borne out by Canadian statesmen, that if we had come to terms with regard to this preference there would have been no agreement between the United States and Canada. When the right hon. Gentleman who moved the Amendment spoke of the diversion of trade from East and West to North and South there were loud cheers, which sounded almost like foreign cheers, almost like Chinese cheers, from the benches opposite—cheers for increased trade for a foreign country, when they knew that increased trade must inevitably displace the trade of this country. I think if these goods were not bought from the United States the probability is that they would be bought from this country, and instead of the exchange of trucks which we have heard about between North and South you would have had an exchange of ships between East and West, and British seamen would have benefited, and the great railway companies, where £400,000,000 of British capital are invested, would have benefited instead of the Americans whom hon. Members opposite have cheered so loudly. I hope, even at this eleventh hour, this question has not been delayed too long. I believe if the principle of preference were established on corn, or anything else this Session, this policy could be stopped, which must inevitably bring about the disintegration of the British Empire. Hon. Gentlemen opposite laugh. I only wish they could understand what their laughter means to the Colonies of the British Empire. I only wish they could be brought into closer touch with all the Colonials who came over to this country from Australia and New Zealand and our other Dominions, and ask them occasionally if they believe there is any other way in which you can hold the British Empire together in future unless by showing that you are ready to do for them what they are ready to do for you.

This point may perhaps appeal to hon. Gentlemen opposite who do not perhaps always look to the other side of the question—the Dominion point of view. I think our first consideration must be: Is there to be any great disadvantage to the people of this country. You are perfectly right to look at it in this way. I say first of all that there will be no disadvantage. It is impossible that 3d. a bushel on wheat, even if on the whole supply, could touch the price of the loaf. When hon. Gentlemen opposite know that wheat has varied in price by 14s. a quarter and only added 1d. to the price of the loaf you can dismiss that. But even if you do not, do you realise that if we keep our comparative positions, it means a difference of £50,000,000 to the wages of the working men before the century is out? [Laughter.] Hon. Gentlemen always laugh when we get to grips on this question from the point of view of labour. We ask them to consider this from that particular point of view, and I should like to ask the hon. Gentlemen opposite who claimed to represent the democracy, whilst we on this side are, of course, only returned by the votes of Dukes, I was going to say, only they have no votes, seriously to take the figures of Canadian trade since the Preference was instituted and work out what Preference has meant in wages to the British working man, and I believe he will come down to this House, if he has the opportunity, and stand up for the British working man by giving a preference to the British Empire instead of banging the door against the Colonies. The Home Secretary, in that courtly language of which he is a master, when he met the Colonial Premiers, who had been giving us Preference year after year, said: "Popular or unpopular, we will not give a farthing preference on a single peppercorn." If we put this into other words it means this. You may buy millions of goods from us year by year, you may give work to our workers, you may start our factories, but we will not give you a single farthing's advantage on a British peppercorn over a foreign peppercorn which may come into this country. If he maintains that attitude I admit it is impossible to endeavour to convert him, but I believe the only true interest of this country in the long run will be to encourage inter-Imperial trade between various parts of the Empire, and the only way that this country is going to be able to bear the enormously increased burden of Naval defence in the future is by coming to a reciprocal arrangement with the Colonies which will bring all the people of the Empire together into one solid unity to bear the burden which at present falls upon this small population.


I hope that, as not very long ago I had some little opportunity of meeting a considerable number both of the leading statesmen and citizens of the Dominion of Canada, I may be permitted in their name to repudiate entirely some of the remarks made by the hon. Gentleman who spoke last, who said that if we did not give Canada some form of preference the Empire is bound to be disintegrated. That libel on the Canadian people——


I did not say that.


Yes, you did.


I said, "Would tend in the end to disintegration."


The hon. Member said that if we did not follow the policy which he advocates the British Empire will be disintegrated. If it becomes disintegrated, according to him, it is because we do not give Canada a preference.


But we are going to, so it is all right.


Not at all. The statement is too serious, it has been too frequently made and is too much resented in the Dominion of Canada. It is a matter of indifference here whether hon. Members makes this statement, but it is not a matter of indifference to the Canadian people. I had the honour when in Canada of addressing at Toronto the Canada Club, the oldest Canadian club—an audience consisting of leading citizens of the town—on a subject on which the largest number probably did not agree with my sentiments or my economics, and when I put to them that statement that Canadian loyalty, Canadian love for the Empire, and the bonds of Empire would in the least degree be affected, either strengthened or loosened, by our fiscal policy, they unanimously and with one voice protested and agreed that whatever fiscal policy we pursued in this country, whatever we may do, whether we maintained our present system or not, the devotion of the Canadian to the Mother Country would not be in any way affected. I will quote on this point Sir Wilfrid Laurier, whose name has been used, and to whom opinions have been attributed of which I am perfectly certain he is absolutely innocent. Speaking at Nelson in August, 1910, Sir Wilfrid Laurier said:— It is not the policy of the Canadian Government to ask Great Britain to change her fiscal policy one iota. We make our own fiscal arrangements to suit our own interests. So it is with Great Britain. I have heard it said (and by whom could it be said except by our own Tariff Reformers), that unless Great Britain gave Canada some mutual tariff arrangement there was danger of an estrangement of our Dominion. This is an insult to the Canadian people. I beg Tariff Reformers, and their papers and organs, to cease insulting the Canadian people by repeating that statement. Sir Wilfrid Laurier went on:— Let the world know that the loyalty of Canada to the British Empire, of which she is proud to be a part, is not dependent on any tariff agreement. Canada is united to the Motherland in heart and in life independent of all tariff arrangements. If that is the case, let us at any rate free from our minds the thought that we have to tax the food of the people of this country to keep the Dominion loyal. When we have swept that away we have swept away one half of the rhetoric we have heard from 1903 to this afternoon on the subject. We have heard this afternoon, without cessation, the statement from hon. Gentlemen opposite that they are not criticising the conduct of Canada. What does the Amendment mean? What do their speeches mean? Do they wish this treaty to be ratified or not? The hon. Member says this treaty is a disaster to the Empire. Who is preparing the disaster? Sir Wilfrid Laurier and his Cabinet. Is not that a criticism? If the hon. Member alone said it, it would be a matter of small importance, but it has been said by some in this House by whose words I was staggered. It was stated by the Leader of the Opposition. I should never have expected to hear in this House a responsible ex-Prime Minister of this country use such outrageous language about the policy of the Prime Minister and the Cabinet of one of our great Colonies. I will read the actual words he used: The right hon. Gentleman started by giving some extraordinary Canadian history and then he said:— But nevertheless there remains the fact that there has been a departure begun by the two Governments of Canada and the United States which must have the most far reaching, and, if it be carried out, as I think the most disastrous consequences upon the future of the Empire. It has not been ratified or agreed to, and this is what the Leader of the Opposition, an ex-Prime Minister of this country, goes on to say:— If that policy is carried out, if it really reaches-fruition and consummation, I regard that as a great Imperial disaster—— Who is preparing the great Imperial disaster? Who is carrying it out? [An HON. MEMBER: "Continue the quotation."] I will continue it, A disaster brought upon us entirely by the refusal of the Government and those who support the Government to listen to the long pleading of Canadian statesmen extending over these many decades. Hon. Gentlemen opposite cannot deny that if the Canadian Government had not negotiated with the United States there would be no treaty, and, therefore, no disaster. In their view the direct and prime moving cause of the Imperial disaster will be the ratification and the carrying out of the treaty arranged by the Governments of Washington and Ottawa. It need not be carried out or ratified. I say that if it is carried out, it will be by the desire and on the direct responsibility of the Government of Canada and the Liberal Party in the Dominion Parliament. In view of the statement made by the Leader of the Opposition, I am not astonished that the Canadian Finance Minister has taken the step of sending the telegram to Lord Strathcona which is published to-day and in which he explains the policy of the Canadian Government. What does that cablegram mean and who are the public men to whom it refers? The cablegram is a direct reply to the remarkable outburst of the Leader of the Opposition. No doubt the right hon. Gentleman and his friends did not intend the statement to have the effect which it has had. I do not charge them with that. But the hon. Member for Gravesend (Sir Gilbert Parker) knows the extraordinary sensitiveness of the Canadian people and the sentiment which prevails in the Dominion on the question of criticism of their domestic policy from these shores. I claim to be as strong an Imperialist as the hon. Gentleman who spoke last. But I contend that if his party wished to wreck the Empire and drive the Dominion out of it they could take no better way to do so than by the language used in some of their speeches in the discussion we have had this afternoon.

The right hon. Gentleman the Member for East Worcestershire (Mr. Austen Chamberlain) told us that for thirty years Canadian Ministers have been offering us preference. I should like to know how he arrived at the period of thirty years. What were he and his party doing during that time? Are we to understand that they continuously rejected the offers of Colonial Ministers. A convert is always an amusing spectacle. The right hon. Gentleman the Leader of the Opposition remained from 1902 to 1906 quietly on the Front Bench of this House, while he had it in his power to introduce Colonial Preference. There was, during part of that period, a 1s. duty upon corn which could easily have been converted into Colonial Preference, but that was not done, and the spectacle of his coming down and denouncing our Front Bench for not adopting Colonial Preference is really one that I should have thought a gentleman of his fine sensibility would have had difficulty in exhibiting to us. The right hon. Gentleman who moved the Amendment to-day stated that we had said that if this commercial treaty went through it would kill Preference. That has been said, but he must not blame us. He might have gone and had a quiet talk on the subject with Lord Northcliffe or the editor of "The Times" or the editor of the "Daily Telegraph." It was not we who said that this treaty would kill Preference. It was said by the supporters of the right hon. Gentleman in the Press, who, with one accord began to testify on the subject. I could never understand the reason of the extraordinary readiness displayed to jettison this preference cargo, to throw overboard the dead albatross, unless it was in order to get the ship into a more favourable wind, with a view to wafting back the party opposite to the Front Government Bench. I leave them to settle that matter among themselves. I think they may have a few questions yet to ask each other before the concert is once more harmonic, before the formula is once more sound, and before the Empire is once more safe.

Sir Wilfrid Laurier has stated over and over again that Preference was instituted as a method of reducing taxation to the Canadian consumer. In 1897 a preference tariff was introduced for the first time. It may be interesting to remember that from 1879 on Sir John MacDonald, the Conservative leader, pursued the well-known "National Policy" of the maintenance of Protection for the purpose of developing Canadian industry against our industry or any other industry. That party was defeated in 1896 with great slaughter. In that year a great Free Trade campaign was brought to a victorious conclusion. Although the tariff contained proposals with the United States it did not contain any reference to England at all. So the history of the right hon. Gentleman, the leader of the Opposition, on the Canadian tariff question, is extraordinarily inaccurate. I must confess I am astonished that when he was going to speak on the subject he did not take the trouble to get somebody to tell him what the facts were. I am not astonished that Mr. Fielding found it necessary to correct the statement of the right hon. Gentleman opposite and to explain that reciprocal trade relations with the United States had been the policy of all parties in Canada for generations. This policy having been followed by all parties there for generations is suddenly raised for party purposes here at this moment, and the Government is blamed for not having taken certain action during the last five years. The statements made by hon. Members opposite may go down in the House of Commons. They may go down at Tariff Reform meetings; but they meet with a very remarkable reception at Ottawa, Toronto, and Montreal. Many efforts have been made in the direction of reciprocity, and Mr. Fielding gives the reason. He says: "Canada is seeking markets everywhere for certain products, subsidising steamship lines, and sending out commercial agents, and would not it be ridiculous in pursuit of such a policy to refuse to avail ourselves of the markets of the greatest nation lying alongside us I Now on this question I think it is essential that we should in all seriousness begin to understand better Canada's position in the world, and Canada's position to-day.

Canada is a nation, a great nation, a nation with an unlimited future, a country of splendid possibilities, with a virile population of enormous energy, and the fundamental idea underlying the Tariff Reformers' action from the very beginning is that they have looked on Canada as a kind of backyard for English goods. Evidently, when the right hon. Gentleman the Member for West Birmingham in that speech in Glasgow talked about the schedule of Canadian industries hon. Gentlemen opposite, like the hon. Gentleman who spoke last, seemed to imagine that they could put the Canadian people in a kind of straight-waistcoat in which trade would be diverted from the rest of the world to us and to us alone. I ask in all seriousness of hon. Members, both as supporters of the Empire and as business men, to give up these illusions, because illusions they are. When I was over in Canada a short time ago I had an opportunity of talking on this very subject with a leading statesman, a Canadian, and I put to him that very question, whether he thought any Canadian Government would make a preference treaty with this country which would debar Canada from entering into reciprocity with the United States—which was a question of great interest at that time—or with other nations. His reply to me was that neither the present nor, in his opinion, any further Canadian Government would dare to make a treaty which would tie the hands of their successors in making commercial treaties either with the United States or with any other country. I have no doubt that he was perfectly right. He was a man occupying a very important position. I put it to hon. Gentlemen opposite in all seriousness, they should not overlook that whatever they might do with the policy of Preference, they could not affect by that Canada's rights to make commercial treaties, such as she is making now with the United States or with France, Germany or any other country. If they attempted anything of the kind all their efforts would end in failure. The gentleman of whom I speak pointed out that it would be ridiculous for them not to make treaties which would be of advantage to Canada.

On one point it is very difficult to follow hon Gentlemen opposite. We have been told that a 2s. duty on wheat would not raise the price of bread or the price of corn. On the other hand, while the price of corn remained the same, the wheat industry was to be immensely stimulated. Now, what was to stimulate the wheat industry? Then again, we were told that if the industry is stimulated the price would go down. Can the industry be stimulated by falling prices? Prices having gone down, would the Canadian farmer be induced to produce a surplus amount of wheat for our benefit, the effect of the Preference having been to ruin his chief industry by lowering the price? "The Times" correspondent writing the other day, said that after all the Canadian farmer expected the 2s. duty to raise the price 6 cents a bushel. He expected to get more and not less with the 2s. duty. It may interest hon. Gentlemen opposite to know that the Canadian people believe that duties are paid by the consumer In all my inquiries wherever I went I could find no one who would agree with the convenient theory that the foreigner paid them. When I suggested it to some of my friends they simply held up their hands in amazement. A large cotton spinner in Rhode Island said to me "if that were so what on earth would be the use of a tariff?" I do not know whether the Canadian farmer, in case Preference were granted to him here, would get the 6 cents a bushel on which he reckoned, or whether the railway company and the elevator company would take it between them, which seems to me more likely. The idea that you are going to stimulate cheap production in Canada by putting on a duty that will have no effect on price seems to any business man a perfectly unworkable proposition, and a useless proposition. Then why put it forward? I have heard it argued that you would enhance the value of the Canadian farmer's wheat by diminishing the value of the wheat of the Argentine farmer. The fact that the Argentine farmer would make 2s. less profit than he does now is no inducement to Canada to grow more wheat. It is of no interest to him whatever. Unless you admit, and you are bound to admit, that the price would be raised at least 2s. a quarter the whole of the stimulus argument falls to the ground. The right hon. Gentleman the Leader of the Opposition says we have talked about cheap food, but that now a time is coming when the price of corn will go up. Well, will not that stimulate wheat production. Wil not there be more wheat coming here to balance the wheat going to the United States? Of course there will. You cannot stimulate wheat production by raising the price by means of Preference and fail to do so by raising the price by Reciprocity. Anything we do in this country is not going artificially to raise the price. We cannot possibly help it. We cannot stop the American taking the duty off wheat. We could not stop it with all the Preference in the world. Personally I believe, and I have it on the authority of one of the greatest wheat importers in this country, that that will not be the effect of it all.

10.0 P.M.

There is a curious legend abroad as to Canadian wheat and the importation of it by the United States, a wheat producing and consuming country. I have the figures for 1910. In that year we imported a total of 105,000,000 cwts.—29,000,000 cwts. from Russia; 1,000,000 from Roumania; 11,000,000 from the United States; 15,000,000 from the Argentine, and nearly 18,000,000 from the British West Indies; 13,000,000 from Australia; and 16,000,000 from Canada. So that we imported 11,000,000 cwts. from the United States, while of the whole 105,000,000 cwts. we imported from Canada only 16,000,000 cwts. Does anybody believe that this small amount of wheat is going to affect the price of the 105,000,000 cwts. we import? What is going to happen to the 11,000,000 cwts. which the United States send us to-day? The United States are not going to eat more wheat than they do to-day. [An HON. MEMBER: "They are."] I do not think so They are getting all they can digest, and rather more. The question of the trade route will, it is thought, be of very great consequence to the interests of this country. But take San Francisco, and imagine how far that is from the Eastern markets. Take wheat grown in British Columbia, which now goes by Vancouver to Japan. Imagine how far that is away from the Eastern parts of the country. In dealing with these matters you have to consider a frontier line of 3,000 miles. In the speeches I have heard there were continual references to the traffic from East to West, and to its being diverted to North and South. Do hon. Gentlemen imagine that there is no traffic from North to South? You have only to take the railway map and study the line north and south to see that the traffic does exist. The traffic East and West is largely a water traffic. The right hon. Gentleman talked about empty trucks passing to and fro. Is it really imagined that goods are transported across the lakes in empty trucks? The diversion of traffic north and south will not take place west of the lakes. [An HON. MEMBER: Why?] It would take too long to explain. I should want a big map and a pointer. Sir William Mackenzie, a railway man of the highest standing, and other authorities, have declared publicly that the fears entertained of an enormous diversion of traffic north and south are exaggerated. I would point out that a very large proportion of Canadian wheat passes in bond to the United States. It is not realised that for something like four months in the year there is no navigation, and that then divergence north to south largely takes place. I have some figures relating to the point. In 1908 Canadian wheat in transit was shipped from the following United States ports:—Boston, 7,687,000 bushels; Baltimore, 88,000; New York, 4,333,000; Philadelphia, 2,500,000; and Portland, 5,000,000—or a total of over 19,000,000. In reality, therefore, it will be seen that exaggerated fears have been expressed—fears which I do not think we need entertain. The East and West route must be maintained for many purposes. It is a fact that the traffic between America and Canada is naturally very much larger than between this country and Canada. We hear it said that Canada will be drawn into the orbit of the United States. If that is to be the result of this agreement, then Canada ought to be in the orbit of the United States to-day. The hon. Member shakes his head, but if he analyse the products which the Canadians are buying from America he will find that a large amount of them are products with regard to which we are not really in competition. I have gone through the list very carefully, and I find that there are very few products in which we are really competitors with America in the Canadian markets. It is an extraordinary fact that in Toronto, at a large machinery works, they obtain their timber for their machinery from the United States, and have to pay duty on it. The Americans have to pay duty to Canada for going across the border a few miles, and the Canadians have to pay duty to America. If you lived on that border line you would laugh at the absurdity of this, and it might even impress the most hardened Tariff Reformer. In the year ending 31st March, 1909 the total trade of Canada with England was £42,000,000. Its total trade with the United States was £59,000,000. While we bought from Canada £27,000,000 worth of goods, they imported from us only £14,000,000 worth. The United States bought £19,000,000' worth of goods from Canada, and Canada bought £40,000,000 from the States. The Canadian trade, therefore, is very much larger with the United States than it is with us. I do not mention that as being a pleasant thing for us, but I do say it does away with the idea that because Canada and America are naturally bound to do a large amount of trade with one another, therefore Canada in some mysterious way will drop out of the Empire. We are always hearing that unless we tax a number of articles from Canada which are on the list of the Tariff Reform Commission that Canada is going to drift away from us. You cannot fight what is a natural tendency, and to attempt to set it back by means of Preference appears to me to be perfectly futile. The Tariff Reformers have proposed to put a tax on articles from Canada which now get free access to our markets. How glad the Canadian should be to know that there is to be a duty on his flour. And if those duties are to be imposed, what advantage would it be to the Canadian dairy farmer, for instance, to have access to our markets made more difficult? We have never yet heard the Leader of the Opposition, in spite of the many speeches he has made, give a single scheme of worked out Preference that any business man in Canada could possibly understand. The able correspondent of the "Daily Mail" reluctantly has to report that he can find no enthusiasm for Tariff Reform in Canada. We are now told Referendum is to be thrust between the legs of Tariff Reform; and we ourselves are denounced in unmeasured terms for not having performed impossible feats. Those charges leave us cold, very cold indeed. The right hon. Gentleman the Member for East Worcestershire said that he was a pupil of Sir Wilfrid Laurier. That being so I hope we shall soon receive his subscription to the Cobden Club. Sir Wilfrid Laurier has not yet repudiated the Free Trade doctrine in which he was brought up; and to which by means of preference he has been able to give effect to extent, and by reciprocity to a somewhat greater extent. Sir Wilfrid Laurier, speaking at Yorkton, on the 20th July, 1910, said:— If I had my way I would have a free British tariff, Britain is my model not only for history, not only for constitutional government, not only for public life; but for political economy. But I recognise that all views must be met and changes made gradually The right hon. Gentleman told us he was going to sit at the feet of the Prime Minster of Canada, so that he had better leave the Tariff Reform League and join the association to which I belong. He had better not use the name of Sir Wilfrid Laurier as it had been used by many hon. Members on the other side. We would do well to leave the names of Colonial statesmen out of our domestic policy as far as possible, though I must confess it is a difficult thing to avoid. At any rate do not let us, if we quote them, misrepresent their opinions. I have had the pleasure of knowing Sir Wilfrid Laurier for a great number of years, and of having had many conversations with him. I do not accuse anyone of wilfully misrepresenting him, but I would say it is not fair either to him or the party he leads, and I do not think it is fair to the controversy in this country, to endeavour to quote him as a supporter of the policy of the Tariff Reform League.


Is he a Free Trader? What is the duty on imports?


I am afraid the hon. Gentleman is taking me far away. If he asks me if Sir Wilfrid Laurier is a Free Trader I am bound to say he is, and he has frequently stated so. "If I had my way," he says, "I would have a free British tariff." It is not my duty either to attempt to defend or condemn, or to explain in any way the conduct of Sir Wilfrid Laurier as Prime Minister of Canada, but if the hon. Gentleman wishes to know whether he is a Free Trader he had better inquire from Sir Wilfrid Laurier. The other point requires an answer. The average ad valorem rates of duty collected in Canada on imports from Great Britain were in 1909, 25.75 per cent., and on the imports from the United States, 24.86. The average on total imports was, on those from Great Britain 19 per cent., and from the United States 13.2 per cent. I can speak for only one industry—that with which I am connected. We have greatly increased our trade with Canada during the last eight years. I would be the last man in the world to deny the value of the Canadian preference, it would be extremely foolish to do so; but it is equally inaccurate to say that the total increase in our trade is due to the preference. Hon. Members opposite are endeavouring to make out that we have finished with Canadian preference; whereas an increase of the preference is one of the points for which Canadian Free Traders are fighting. What was the resolution passed by the organised farmers of Canada and laid before the Government? We strongly favour reciprocal free trade between Canada and the United States in all horticultural, agricultural, and animal products … in all agricultural implements, machinery, and vehicles… We also favour the principle of the British preferential tariff, and urge an immediate lowering of the duties on all British goods to one-half the rates charged under the general tariff schedule, whatever that may be; and that any trade advantages given the United States in reciprocal trade relations be extended to Great Britain. Such further gradual reduction of the remaining preferential tariff as will ensure the establishment of complete free trade between Canada and the Motherland within ten years. The farmers of this country are willing to face direct taxation in such form as may be advisable to make up the revenue required under new tariff conditions. That is the petition of the organised farmers of the West. Foolish attempts have been made on the Tariff Reform side to minimise the importance of the growing feeling in favour of Free Trade in the West. I have seen a statement that I went out to Canada to organise great demonstrations, to convert the millions to Free Trade. The idea that any individual like myself could convert the millions on fiscal policy scarcely admits of a moment's examination. I was surprised to find the growing organised feeling of the farmers of the West. There was another astonishing fact. I was informed that West of Winnipeg you cannot find a single newspaper, Liberal or Conservative, which is not fighting for Free Trade, and attacking the Laurier Government because it is not Free Trade enough. [Several HON. MEMBERS: "Name."] The statement was made to me by the Editor of the "Toronto Globe." [An HON. MEMBER: "West of Winnipeg."] I am not well acquainted with affairs west of Winnipeg; I merely take the statement given to me for what it is worth. I have never maintained that the overwhelming population of Canada at present is Free Trade; I only say that it is foolish to try to minimise the growing feeling of the organised farmers of the West. The fact that this growing opinion demands greater Free Trade between this country and Canada without asking that we should in any way increase the cost of living to our people is entirely overlooked by speakers on the other side of the House. It is said that unless you oppose the agreement you will lose your preference with Canada. That statement is absolutely untrue. The true statement of the position is that the reciprocity treaty with the United States will enable the Laurier Government to relieve us of some of the duties. Mr. Fielding has said that we would be no worse of. Tariff revision is bound to come in Canada as well as the United States. It is asked why have We not told Canada our opinion of this treaty. I was asked in Canada and also in the United States to give my views with regard to reciprocity. I refused to say anything. I do not think it is our business to express our views. One view I did express. It was this: that the people of England would be quite satisfied if the Canadians did anything that would promote the prosperity of the Dominion. I am amazed at the language I have heard from the other side of the House. The right hon. Gentleman the Member for East Worcestershire seemed to show jealousy for fear that under this arrangement the Canadian manufacturer of cutlery might get a little advantage over the English manufacturer of cutlery.


No, Sir; the hon. Gentleman will permit me: that was not my argument. The trend of my inquiry was not that. It was: Whether the Government of this country were taking the same precautions for the protection of English trade as the Government of Canada was taking for the protection of Canadian trade?


It may have been the trend of the right hon. Gentleman's thought; it was not the trend of what he said. [HON. MEMBERS: "Withdraw."] I hope I have said nothing offensive. I did not intend to do so. I merely pointed out what impressed itself upon my mind. It may be my fault; my lack of comprehension. But I do want strongly to emphasise this point: my amazement that any kind of jealousy should be felt. We do not want to feel that if the Canadian people do something that they think good for themselves, even though it may not be altogether good for us, that therefore we ought to complain in any way, or try to upset their arrangements. The question is too large and too important. If this treaty goes through, I see opening out before us something larger than hon. Gentlemen have realised. They have dreamed—we have all dreamed!—of Imperial union. How about the Anglo-Saxon and English-speaking races? Do you believe that the millions of the United States are to be entirely outside the embodiment of this federation? Do you not think that more friendly relations between the Dominion of Canada and the United States of America would make a vast change in the future, and make a vast change in the commercial relations between the United States and England? If we hail this as really a triumph of Free Trade, and a triumph for Free Trade it is, we also hail for other reasons the beginning of the breakdown of tariff walls, which, when once fallen, will never be set up again. Many hon. Gentlemen opposite are, I know, only Tariff Reformers because they want universal Free Trade. They believe that by Retaliation they could bring about this blessed state of things, but the world tried Retaliation much longer than the world ever tried Free Trade. This country tried Retaliation for centuries. Sir Robert Peel, with his great genius, threw it from his hand as a broken weapon, and I do not think the influence of the right hon. Gentleman the Member for East Worcester (Mr. Austen Chamberlain) with all his great abilities, will prove more powerful than that of Sir Robert Peel and Mr. Gladstone in 1842. A breach of any tariff wall makes towards international Free Trade, with which is bound up international peace, which goes far beyond the mere question of pounds, shillings and pence. Free Trade, which Cobden once dreamt would be extended to the whole world, is based upon the rock of economic freedom and on a sound principle. We welcome the extension of that principle with joy, and we extend our hands to the Free Traders in Canada and to those who have won a victory in the United States-No jealousy will mar or diminish that comradeship which we feel will solve these problems, and which makes for universal peace and for the happiness of the whole human race.


After listening this afternoon to the speech of the hon. Member for South Shields (Mr. Russell Rea) and to the speech of the hon. Member for East Northamptonshire (Mr. Chiozza Money) I feel we ought all to be better and nobler men. After listening for forty minutes or more to the speech of the hon. Gentleman who has just sat down I feel that we ought all to experience a sense of chastisement, and we ought to put on the white robe and sackcloth of penitence. I would like, however, to make a few observations upon the speech of the hon. Gentleman. I recognise with what voice of authority he speaks for the Empire because of a recent visit to Canada and some frequentation of Ministers and newspaper editors to that country. I know that he made Free Trade speeches in Canada and met a great many people. I am not, however, convinced that his speech to-night represents the views of the Canadian people, or indeed of any Colonial people. I will give some reasons for that statement. The hon. Member talked about Sir Wilfrid Laurier being a convinced Free Trader. Of course he is. His sentiments, which we all admire and appreciate, are the sentiments of a member of the Cobden Club, and his strong belief in Free Trade has, during the last fifteen years, been represented by the highest protective tariff that the prosperous country of Canada has ever known since she became prosperous by the introduction of the national policy in 1878. The hon. Member suggests that we are the authors of what he designates the fable about the passage of products east and west, and the policy of building up a trade east and west instead of north and south. He regaled the House with some quotations. It is easy to make quotations, and I am going to inflict one on the House. It is a quotation from a speech Sir Wilfrid Laurier made, not under the immediate stress of any political influence in the House of Commons in Canada—not when receiving a deputation of Western farmers when, like all politicians, he has to meet the difficulties of the immediate moment, and no one does it with greater skill than Sir Wilfrid Laurier—but in a great conference of the Premiers of our great dominions. He said:— If we were to follow the lines of nature and geography between Canada and the United States, the whole trade would flow from South to North and North to South. We have done everything possible by building canals and subsidising railways to bring the trade from West to East and East to West. What for? So as to bring it into British channels. All this we have done, recognising the principle of the great advantage of forcing trade within the British Empire. Sir Wilfrid Laurier said that at the Conference held in London in 1907. May I for a moment or two draw the attention of the House to the progress of Imperial preference. We have been chastised to-day for discussing this question, and raising it in the House of Commons. If I know the Canadian people at all, and I believe I do, not from a visit of two or three weeks but from a much closer association, I think I am right in saying that the people of Canada to-day will welcome the discussion in this House. They do not consider this a question of domestic policy alone. To them it is one of Imperial importance, and it is an international policy. They would think we were neglecting our duty if, when they came to make an international arrangement which results from the fact that we have made no Motion to secure similar advantage for ourselves we did not discuss the matter. They are not the people to find any fault with us for taking an interest in a great international question affecting the future of this Empire. The Leader of the Opposition has been abused for a statement that he made that this was an Imperial disaster. I venture to-night to repeat that statement. It is an Imperial misfortune—yes, and a great Imperial misfortune, to this country and to the Empire that we have not been able to produce an arrangement with Canada which would develop that trade which Sir Wilfrid Laurier and the colleagues of his ministry and successive ministries have endeavoured to develop during the last fifteen years. Why is it a misfortune? Those of us who know the history of Canada know the feelings which have moved the Canadian people in offering us Preference. In 1854 they enjoyed conditions of reciprocity, not Free Trade, with the United States, and under that they prospered. When that treaty was abrogated, Canada became the slaughter market for the surplus goods of the United States. There is no Canadian known alive but will admit that the abrogation of that International arrangement by which Canadians had the exchange of reciprocal products with the United States was a disaster. Then there came in Canada an influence under which I came, an influence of remarkable brilliance and illumination, and literary distinction. I refer to the presence in Canada of Professor Goldwin Smith, who sedulously and continuously preached the doctrine of annexation to the United States. I frankly say to-night that there seemed to me twenty years ago or more to be a vast deal of logic in what Mr. Goldwin Smith said. It was full of logic. I did not then realise, but I came to realise afterwards, that logic does not control the destinies of any country, but nationality, built up in spite of disadvantageous conditions, geographical, political, and otherwise. It seemed to me, not because I wished it, but because I did not believe at that time that Canada could resist this terrific commercial pressure from the south, that the forty millions, as they were then, the sixty millions to three would result in Canadian agriculture being kept down, and being unproductive. The faith of the Canadian people and the wise policy of Sir John Alexander Macdonald, of whom the hon. Member, with his usual accuracy, speaks as being alive in 1897——


I did not speak of him being alive in 1897. I spoke of Sir Wilfrid Laurier fighting his policy in 1897.


I accept the hon. Gentleman's statement. What was Sir John Alexander MacDonald's policy? Sir John Alexander MacDonald made the last fight of his life in 1890 against that which brought to these Irish Benches the Member for Longford, Mr. Edward Blake. Mr. Edward Blake left the Liberal party in Canada because he would not in 1890 accept the policy of commercial union with the United States. He came to this country and joined the Irish party. Sir John Alexander MacDonald made the last fight of his political life against commercial union with the United States because, as he said, and as Mr. Edward Blake said, it would lead to political domination and political annexation. Canada decided that she would not have commercial union. She does not want commercial union now. The hon. Member in that sense interprets Canadian opinion correctly. She does not want commercial union with the United States; she does not want commercial annexation, but she did desire that condition of commercial interchange and reciprocal benefit given now to the United States, which would have been given to us if in the Conference of 1907 we had accepted the reasoned representations of the Ministers of all our self-governing Colonies. They blame my right hon. Friend for not giving preference and keeping the shilling tax upon corn. I do not want to say a single word which will not seem reasonable, but we know perfectly well that for two generations this country had accepted—Liberals and Conservatives alike—the principle of Free Trade. Every movement to change a policy requires time, and every party that attempts to change a policy must inevitably face difficulties. In 1902, I venture to say, public opinion was not ready to accept a change of policy which would give preference to our Colonies and put a tax upon foreign-manufactured goods; but from 1902 to 1907 there was a steady investigation of this subject, and the steady growth of public opinion was to back up the wishes of the representatives of every Colony in our Empire. Therefore, when we came to the Conference in 1907, we came to a time when there was an opportunity to give preference to our Colonies without the executive of this nation taking responsibility for a move which had not public opinion behind it. I believe that whatever the opinions of the Liberal party may be throughout the country, there is no objection whatever concerning the taxation of foreign-manufactured goods, and there is no objection to the principle of preference. It is not the principle which hon. Members opposite object to: it is cash: it is the raising of the cost of the food of the people: it is the expense of the application of the principle. I should like to draw attention for one minute to the charge which is constantly made as to the 2s. which was the Preference asked for by the Colonies. I believe they would have taken less—I believe that a shilling preference would have been all that was necessary for developing Imperial trade between Canada and this country. The hon. Gentleman asks how possibly could a shilling preference benefit Canadian corn unless the price to the British consumer was raised? I expect the hon Member in his many experiences will have sometimes been on a racecourse and will have seen a horse handicapped with lead under its saddle. That horse enters into the race with that handicap. The position is exactly identical between the Canadian farmer and the Russian farmer and the Canadian farmer and the American farmer. It is not a case of a shilling which you put into the pocket of the Canadian farmer, but it is the handicap you place upon his competitor. If the Canadian and Australian entered free into our market and his competitor traded with a one shilling tax, the Canadian and Australian would have the advantage. It is that advantage which we believe would have been given if the right hon. Gentlemen who occupy those benches opposite had in 1907 met the definite request of every Prime Minister of our Colonies to increase our trade with them by mutual concessions which would not be costly to the other party to the contract.

The President of the Board of Trade says a 2s. tax on corn would inevitably raise the cost of bread. Let us see. In 1908–9 wheat fluctuated from 31s. 8d. to 43s. 4d.—a difference of 11s. 8d. Bread rose on that 11s. 8d. increase under a halfpenny, but in October, 1909, wheat was 31s. 8d. a quarter and in December it was 33s., but in October the bread was 6d. and in December 5d. It is perfectly evident that it has occurred constantly in the wheat market of this country that an increase of 6s. or 7s. even has not produced a rise in the price of bread. The right hon. Gentlemen opposite would take no such risks, they are such keen economists, such natural patriots—the only people who desire the welfare of the country so strongly that they will take no risks whatever of any rise of a fraction of a farthing concerning the food of the people. I think that the example of the people of Canada and their boldness in their national difficulties is to be admired. Their difficulties were plain. They had to get increased markets for their natural products. The hon. Gentlemen opposite says that their action in regard to this treaty represents a movement all over the world for the development of Free Trade. I would like to ask him what he thinks of the action of Norway, Sweden, Holland, Japan, Germany, and France? During the last few years in every case there has been a raising of tariffs, an adjustment of tariffs for the protection of the industries of those various countries. The right hon. Gentleman the Member for South Shields [Mr. Russell Rea], in his pious speech this afternoon, said that the policy was against the trend of public opinion at this moment, and the nations of Europe were making endeavours to burst the Protectionist bonds which bound them. Does the right hon. Gentleman really think that the action of Canada in seeking reciprocity represents any movement towards Free Trade. If that were so there would be some action on the borders of the Atlantic and Pacific coasts of the United States with regard to Customs which would show that the United States and Canada meant to develop a policy of Free Trade. Sir Wilfrid Laurier no more intends, Mr. Taft no more intends, to develope the principle of Free Trade than the Liberal Government now in power intends to deal justly with the constitutional question with which we are faced at the present moment. The hon. gentleman who has just sat down, said President Taft was in favour of Free Trade.


I never said anything of the kind. What I said was that the Democratic victory and the election to the Chamber of Congress of a life-long Cobdenite were victories for Free Trade.


I have heard this statement before about the democratic movement of Free Trade. The Home Secretary, in some of his eloquent speeches, has also referred to that movement towards Free Trade in the Democratic party. Does anyone really who knows the United States, and who knows the Democratic party in the United States, believe that what they aim at is the abolition of tariffs? But whoever suggested that a nation should not revise its tariffs? Revision of tariffs, reform of tariffs, does not necessarily mean Free Trade. You may have a low tariff and raise it. You may have a high tariff and lower it. That is what Americans mean; that is what Canadians mean when they talk of Tariff Reform. They mean a revision of tariffs up or down, not an abolition of tariffs. Hon. Members grossly misrepresent Americans or Canadians, or any other nation, when they say that in any nation of the world, or in Canada, or the United States, there is a movement at present in favour of the abolition of tariffs. There is not a single candidate for Parliament in any constituency in Canada or the United States, any more than a Socialist or Labour member in Germany, who dares to go to his constituency and make his appeal to Free Trade and the abolition of the tariffs. In view of the fact that tariffs are being raised, regulated, and strengthened all over the world at the present time, and that treaties arranging for the exchange of products within the four walls of those tariffs are a part of the international policy of all nations, how can any hon. Gentleman or any other Member of the Liberal party talk about the movement towards Free Trade? If the movement, then, is not towards Free Trade but towards the development of tariff policy throughout the world, as it is, what should be our object in this country? Our object should be, as I think, to make such arrangements with other countries as will enable our goods to have freer movement. We ought to be able to regulate the inequalities of international trade. How can we do it? We cannot do it by persuasion. We have not yet been able to do it in Roumania, Japan, Germany, the United States, or France. The only way to do it is by adopting such a policy for purposes of revenue, a reasonable policy for defence of industry and of labour, a reasonable policy which will give us weapons not only for arranging with foreign nations for a better exchange of our products, a freer exchange, a more beneficial, a more profitable exchange, but also which will enable us with free hands to give to our Colonies what they have asked for continuously. Happily there are some Colonies yet which have not entered into reciprocal arrangements. There are New Zealand, Australia, South Africa. We are not disheartened by the action of Canada—she has done what she was justified in doing, what she ought to do for the development of her trade. If we are disheartened it is because we, by our own action, have not placed ourselves in the position of the United States to receive these reciprocal advantages. If we are in that position of not taking advantage of our opportunities with Canada we ought certainly not to give up the question of Imperial Preference, because a wide range of products still remain in the Colonies. I suppose the hon. Member who has just sat down would doubt that we could give Australia any benefit through Preference except by taxing raw materials?


Not at all.


I am very glad to hear it. I knew the hon. Gentleman's omniscience would be equal to the challenge. Australia produces nearly three-fourths as much wheat as Canada produces to-day, and Western Australia has a thousand miles north to south capable of wheat production greater than Canada, because that portion of the Australian Continent is not subject to the same difficulties of climate which confront the Canadian wheat grower. Therefore there remains for us a great field for action in regard to Imperial preference. There still remains to us the duty of drawing nearer Canada where yet we may have the advantage of preference in their markets. This treaty with the United States, begotten on a business basis by business men, will run the course set by legislative enactment. That legislative enactment may represent three, four, five, or seven years. I am absolutely certain that the hon. Member for Sunderland would agree with me in saying that if to-morrow the British people were to offer Canada the kind of preference for which she asks, and has been asking for many years, Canada would take precious good care to continue that policy of building up her trade from West to East and East to West which she has successfully developed for so many years, and not rely upon what I consider to be an experiment fraught with danger in Canada, and fraught with danger to British trade by the unnecessary development of trade with the United States from north to south. We believe that this policy of Preference represents a necessity in our national life and Imperial organisation. We have an Empire of which we cannot get rid if we would. Responsibilities rest upon our shoulders. The Leader of the Opposition wisely said that the problem of the century is the organisation of that Empire. It has passed beyond the experimental stage, and leaves us with responsibilities which we cannot shake off or omit to fulfil. That problem of organisation of Empire is one which, if not carried out by hon. and right hon. Gentlemen on the Government Benches, will be carried out by those who sit on the Benches on this side, when they come into power with the approval of all the citizens of this Empire.

ADJOURNMENT.—Resolved: "That this House do now adjourn."—[Mr. Lyttelton.]

Adjourned accordingly at Eleven o'clock.