HC Deb 16 July 1930 vol 241 cc1303-433

I beg to move, That this House, believing that a return to prosperity can best be promoted by safeguarding the Home market against unfair Foreign competition and by expanding the export market by reciprocal trade agreements with the Empire overseas, regrets that the Government has reversed the policy of safeguarding instead of extending it and has arbitrarily excluded from consideration the imposition of duties upon Foreign foodstuffs devised to obtain equivalent advantages for British manufactures and agriculture in British markets and elsewhere. While it may very well be that among many Members of the House there may be some sense of satiety and weariness in the discussion of these subjects, let them take comfort, for this Parliament is drawing to an end, and no such Motion as this will ever need to be put down in any subsequent Parliament of the United Kingdom. [Interruption.] I remember very well, when I advocated to the best of my youthful ability the principles which are embodied in this Motion, nearly 30 years ago in Kidderminster—I remember very well, as though it were yesterday, a powerful speech being made in the town hall by the present Prime Minister on the Taff Vale decision, which did much more to defeat me even than food taxes and Chinese labour. But I ventured to prophesy in 1904 and 1905 that, when Protection did come into this country, it would come from the then nascent Labour party. I am not at all sure that I was not right, but I just want to peg out my claim to be a true prophet in case anything unexpected happens.

I am very glad indeed to think that the Chancellor of the Exchequer is going to follow me, because there are a number of questions that I wish to ask, to answer which he certainly is the highest authority in this House. I want to examine for one moment—I do not propose to speak at any great length to-day, because there are a great many speakers who wish to take part—I wish to examine for a few moments the claim made by the Government that the present conditions of unemployment are due to world causes. I should like very much to know when the world causes first made themselves felt, because we know quite well that at the time of the last Election the Prime Minister took the line that the Conservative Government had refused to take steps to check the occurrence of unemployment. At that time the world causes, obviously, were not in play. Nor were they in play when the present Chancellor of the Exchequer, in words so beautiful that I must remind him of them literally, said, in the "Daily Herald" of the 3rd June last year: In our first Session we shall deal with unemployment, and bring relief and hope to the workers of the land. We shall not disappoint those who have shown a belief in us. It is a great comfort to feel that, were that promise made to-day, far fewer would be disappointed. I do not know whether the right. hon. Gentleman is as fond of Robert Louis Stevenson as I am, but, if he is, there are words that must have recurred to his mind many times since making that promise: It is a far better thing to travel hopefully than to arrive. The claim made to-day is that the whole problem presents a totally new character. "Is it due to the Labour Government?" asks the Prime Minister. I need hardly say that he answered that question in the negative. He said: There are now industrial conditions, and the problem is a totally different one. That he said on the 21st May. Is it so totally different? What world causes are in existence to-day were surely in existence when we were in office. I pass over, as a question of taste, the year 1926. Those were local causes. Let us leave that on one side and take two or three of the countries principally affected by world causes, passing for one moment to China, where hon. Members who were in the last Parliament will remember that, much against their wishes and desires, we sent a defence force to protect British interests. It is a curious fact that the latest figures I have, which are the figures for 1929, show that we exported to China £4,000,000 worth of goods more than we had exported two years previously. In India, where, of course, our exports are very large and very important to us, if you take 1926, we exported to India £81,750,000, and last year £78,250,000—a trifling decline, and a decline that is more than balanced by the increase in the exports to China. When we came into office things were very troublesome in Egypt. Sir Lee Stack was murdered almost at the time that we took office, and there was a great deal of trouble and confusion in Egypt at that time. The Government claim that they have made relations better and easier with Egypt, and the latest export figures to Egypt are slightly better than they have been for the last three years. And so, through these great countries in the East and the Near East, it does not seem to me, in the want of further knowledge, that there is any serious trouble that the Government have to contend with that we did not enjoy to the full when we were in office.

It is a very difficult matter, as the House knows, to compare unemployment in this country and in other countries, because there are, strictly speaking, no comparable figures. We each make our calculations in our own way. I give the only figures that I can get at, and those are the figures issued in a Bulletin of the League of Nations. They take last March, and the figures are comparable with preceding months of March. I find that in Belgium and France, consistently and for some time, unemployment has been negligible. In Italy it is less that it was two years ago. In Germany—and I shall have a word to say about Germany by-and-by—unemployment has been up and down. In March of this year it stood at practically the same figure at which it stood in March, 1926. In the interval it has been, as I have said, up and down. In 1925 and 1928 the figures showed a very remarkable improvement. We alone maintain and persist in that dead weight of unemployment with which we are so familiar. For the United States, I admit, we have no comparable figures at all. It is a very difficult thing at any given time to say how trade is in the United States. One thing that does stand out is that, though they have periods of depression which come on with almost the rapidity of the crash in Wall Street, they have an amazing method of picking up and coming back into good trade again, and repeating these performances while we go on on the dead level. But I remember very well that in this House, I think it was in September or October, the Lord Privy Seal, as he then was, said: I am confident that when February comes the unemployment figures will be far different, and better than the figures of the late Government. I have no doubt that he meant that at the time, but the fact that he said that shows that in his mind at least there was no idea then that there were world causes in operation in this matter. The Minister of Labour, in budgeting in November on the Unemployment Insurance Bill, although she hedged a little by saying that unemployment was due to a curious combination— National policy, she said, whatever she meant by that, and we shall have a word on that— National policy and international causes"— at the same time she explained to us how vastly superior her powers of estimate were than ours had been. She gave us to understand that she was making a conservative and a safe estimate in asking for the money that she wanted for the Unemployment Insurance Fund, and the figure at Which she then placed unemployment was 1,200,000; so that although, to whatever extent you like to claim, she safeguarded herself by that somewhat ambiguous and equivocal expression, yet it was quite clear during that debate that she thought, and a great many Members of this House thought, that bottom had been touched then in the unemployment figures. I remember that even the Chancellor of the Exchequer himself, although I have not his exact words, during the Budget seemed to have forgotten for the moment the world causes, and intimated to us that he hoped that things might be better. I think I have often said that if it be world causes, then, indeed, we are struggling in vain. If there be other than world causes, there are some steps perhaps that we may take. Years ago, before this Government came in, they were full of ideas of how to deal with unemployment. Let me remind the House of what the Prime Minister said shortly before the Election. We propose, as it were, to organise a brain for thinking. I say the time has come for us to co-ordinate these by a committee over which the Prime Minister himself must preside, and the committee will consist of a nucleus of the Chancellor of the Exchequer, the President of the Board of Trade, the Minister of Labour.… moulded exactly on the basis of the Committee of Imperial Defence. Immediately the Government took office on 7th June, he said: I went to Downing Street to set moving the organisation of the work connected with the first real handling of the unemployment problem. The work has already begun. That brain did not consist of the Ministers whose names I have read out. The brain was organised, but the three component parts were the Lord Privy Seal, as he then was, the Chancellor of the Duchy of Lancaster, as he then was, and the First Commissioner of Works, as he now is. Before that brain produced anything, there was a lesion in it, and the Chancellor of the Duchy became defunct. The First Commissioner of Works I do not think ever functioned, and the whole brain was left to be worked by the Lord Privy Seal, who finally gave it up, or had to give it up, and transferred himself, or has been transferred, to what at the moment is one of the most important positions in the whole Government, the Secretary of State for Dominion Affairs. We do not know in this House to-day who is specially charged with looking after unemployment. We do know that on the break-up of that original brain an appeal has been made to local authorities. We all know perfectly well that whatever the local authorities can do is but a drop in the bucket compared with what wants doing, work they never so hard and be they never so willing.

Then the Prime Minister, after 12 months, invited us to a three-party conference, and on that I shall say a word or two before I sit down. I should like to remind the Chancellor of the Exchequer that in a debate somewhat similar to this on 13th March I asked a great many questions which I think were to the point, at least the answers would have been interesting, but none of the questions were answered. I hope I shall be more fortunate to-day, and I will try again with undiminished ardour and undiminished hope. I would examine for a moment the attitude of the Government and how that has acted and reacted on trade.

As I have said before in the House—I do not, expect the Chancellor to agree with me—and I have said it in the country, one of the things that has caused a good deal of uncertainty in trade has been the handling by the Government, and particularly by him, of the safeguarded industries. A doubt has been caused, in spite of the definite statement that all the Safeguarding Duties and McKenna Duties are going to come off. That doubt has certainly caused a bad reaction, because it has been coupled with doubt, in a different line of country, which has been raised in the industrial world by seeing the taxation of the country going up. That has again caused grave doubt, because there can be no guarantee, when the Government embarks on legislation that needs fresh taxation, that at any given point they may stop. They may desire it, but it is extraordinarily difficult. There is no certainty, and I think the psychological effect of an increase of taxation at this moment, 12 years after the Peace, has probably done more than any single action on the part of the Government to knock the heart out of the industrial community. Of course, it is somewhat unfortunate, the Imperial Conference coming on, that, while the heart was being knocked out of the producers at home, there should have been a backhander at the producers of Colonial sugar. That was a difficult question when we were in, and I have no doubt, although we decided at the time—I am sure the Government will sympathise with us, because they have done so much of it—that we would watch the situation for a year, had we been in we should have had to take active steps to go to their help. I daresay the House remembers quite well what Lord Olivier, who was a member of the last Labour Government said on the subject. I do not think, when Mr. Snowden made that ominous pronouncement of his in July"— that is that he hoped to take off all the taxes on food that exist to-day, and that by so doing the preferences would, of course, automatically fall away— I do not think that when Mr. Snowden made that ominous pronouncement of his in July last, he can have been fully informed of the actual facts of the situation. Whether he was or not, the position of our own Colonial sugar people is very grave, while at the same moment the Government, under the Export Credits Scheme, is granting a credit to Russia which she does not need financially. What for? Not for the purchase of Colonial sugar but for the purchase of sugar in Cuba, which is controlled by the wealthiest sugar interests in the United States of America. When the Colonial growers see that kind of thing going on, it is little wonder if their hearts are knocked out, just the same as the hearts of our home producers.

We put down this Motion largely because this is almost the last chance of debate we shall have before the Imperial Conference is upon us, and we are as a country to-day at the parting of the ways. I want the Chancellor of the Exchequer to tell us which path we are going to take, because such evidence as I have before me leads me to no definite conclusion. This is rather ancient history I am afraid, but I have a quotation from "Labour and the Nation," which represented at the time the official policy of the party. The Labour party is opposed to protective tariffs as both harmful to trade and unfair in their incidence, and to raising income by the taxation of food or other necessaries of life. The Chancellor of the Exchequer said in July last year—this is the quotation that was referred to by Lord Olivier— I hope that before we leave office"— then he added what I am sure he would not add to-day— if ever we do leave office, we shall have swept away all duties upon food—upon sugar, dried fruits, and upon all articles of food which are subject to duty at the present time and on which there are preferences and, of course, when those duties are swept away the preferences will naturally go with them. I have no fault to find with that. It is unequivocal, clear and understandable. But the odd thing is that, in a Supply debate on 26th June of this year, the Secretary of State for the Dominions uttered these words: In other words, I answer the right hon. Gentleman quite frankly by saying again, speaking for myself and the Government, that we will enter this Imperial Conference and exclude nothing from our considerations. We will object to nothing. We will discuss everything on its merits and with a single-minded desire to do all that is possible, not only in the interests of our country, but in the interests of the Empire as a whole.…. I look forward to the Imperial Conference with interest and pleasure—interest, because I believe there never was a time when a more thorough and impartial consideration should be given to all our problems than at this moment, because I believe the present state of our own country is such that nothing ought to prevent any individual or party from examining anything and everything that will tend to mitigate, ease or help our problems."—[OFFICIAL REPORT, 26th June, 1930; col. 1399–1410, Vol. 240.] Speaking at Colchester on the 5th of this month, he said: It is because of that knowledge that, on behalf of the Government, I announced that we intended to enter this Conference free and unfettered, free to consider every problem on its merits, unfettered by prejudice or bias, and prepared with a single-minded desire to try and find a solution of the problem. 4.0 p.m.

Of course, that is diametrically opposed to the first two statements. I want to know, in the first place, which of those two represents the policy of the Government? Certainly, if the Secretary of State for the Dominions meant what he said, he would accept our Motion. But, perhaps, the Chancellor of the Exchequer would explain to us what the Secretary of State meant by that and how to reconcile it with what he said himself. What is the position in which the Imperial Conference is going to be held? The position is that the unemployment in this country has very nearly touched, in the summer months, the appalling figure of 2,000,000. And, what is worse than that, look at the trade returns for the first six months of 1930! Our total exports have fallen by nearly £54,000,000 and our total export of manufactured goods by £45,000,000. What is worse than that—and I said I would revert to Germany—for the first time, according to the figures in the "Times" to-day, the German exports exceed our own—£310,000,000 to £304,000,000—one of the most alarming statements I have ever seen, especially when you have regard to the fact that the Germany that has beaten our exports is a smaller Germany than before the War, and a highly protected Germany. The total retained imports have fallen by £51,000,000. But there is a very interesting feature of the imports, and that is that the retained imports of manufactured goods into this country are practically stationary. The retained imports of manufactured goods are £146,640,000 against £149,330,000, a very, very trifling drop—no drop at all in comparison with the total figures, and, if allowance be made for the fall in prices in the past 12 months, it appears to me that in volume the imports into this country of manufactured goods must have increased. The question arises which I asked repeatedly on 13th March, "What are you going to do?" That question has not been answered.

I propose to say a word about the three-party conference. I am the last man in this country who would treat this matter on party and not national lines if I saw any chance to do it, and I would gladly have gone into a conference if it had not been quite clear that, to my mind, the only method of wrestling with this subject lies through arrangement with the Dominions and through tariffs. That subject, I understood, was ruled out, and it was perfectly impossible to get any further so long as this subject could not be thrashed out. Here, if I may, rather by way of propitiating the Chancellor of the Exchequer, I should like to give him a quotation, which, I hope, he will bear in mind, of a very candid writer, as great an authority on Free Trade as himself, and one whose brains were filled with as much of the milk of human kindness, and that is John Stuart Mill. This will please him. It is sound sense: Protectionists often reason extremely ill, but it is an injustice to them to suppose that their Protectionist creed rests on nothing superior to an economic blunder. Many of them have been led to it much more by consideration for the higher interests of humanity than by purely economic reasons. That is absolutely true, because many of us on this side believe that the only way in which you can maintain at the present time, or improve in the future, our standard of life, lies through that method which Mill condemns intellectually, and sympathises with in another direction. If what the Chancellor of the Exchequer has said; and not what the Secretary of State for the Dominions has said, is the declared policy of the Government to-day, then, indeed, the Government's mind is closed, and it is a curious thing that their mind should be closed at the very moment when everybody else's mind is opening. After many, many long years, some of the most politically timid minds in the country, the minds of the bankers, are opening, the mind of the Federation of British Industries—and they have been asked by the Government for their views regarding the forthcoming Conference—is opening. The mind of the Chambers of Commerce is opening, the mind of the Trade Union Council is also opening, and the Government will go down, alone and unmourned, as the people with an eternally closed mind. I do not propose at this moment to speak of the importance of Safeguarding to the home market. I have spoken on that many times. There are many speakers to follow me, and, doubtless, that point will be raised.

I purpose to come now—and this is the last subject on which I shall speak—to the Imperial Conference which is going to take place in October. I ask the House to bear in mind once more those words of the Secretary of State for the Dominions: Speaking for myself and the Government, we will enter this Imperial Conference and exclude nothing from our consideration. The House remembers the rest of the quotation. On that there arises two or three obvious questions. Does that mean what it says? Does it mean that no subject is barred? We will assume it does, because I think, according to the words, that is the only meaning to be extracted from it. But does it mean that any conclusions will be come to, and, if conclusions are come to, that those conclusions will be given effect to? That is to say, if you have an open discussion, you are bound to discuss the question of tariffs, the question of preferences, the question of the primary products in the Dominions, and whether, in certain circumstances, you will have taxes upon them in this country. Are those questions going to be raised, and, if any conclusions are reached, what then is going to be the mind of the Government?

It may be of some assistance to the Government if I tell them what I would do if I were meeting the Imperial Conference this October. I will take for my text the words of the Secretary of State for the Dominions. I would begin by giving the Conference an assurance of the continuation of Preference as it has existed within the limits of our fiscal system. That is an assurance that they want very badly. These are times of uncertainty. They have been told by the Chancellor of the Exchequer that when he has the opportunity, the Preferences are going. Unless the Dominions are assured that the Preferences are here to stay, that may affect their policy in the future. They may look elsewhere than this country for the growth of their own trade and their trade with other countries. I would, then, at the Conference, explain to the Dominions that I was going in for a wide extension of Safeguarding, and that in every case Preference would be given to the Dominions. That would be of the greatest assistance to them, because it would help in the industrialisation of the Dominions which I think to be a matter of the first importance—important in this way, that the more demand you get for skilled labour in the Dominions, the better chances there are of a happy and a healthy migration from this country, and the better chances there are of the markets growing and developing for the reception of British goods.

Then it would help, also, the process of which I have spoken in this House before—the process of Imperial rationalisation, and I would only say of that—because, I think, many of us now are familiar with the terms of it—that I mean that the industries at home and in the Dominions should get together, and see whether it be possible, by combining themselves for what they can make best either here or there, to share out, as far as it is possible, the Empire markets and the home market for themselves. And I would propose what, I am glad to see, has been touched upon both by the Federation of British Industries and that most interesting document published by the Trade Union Council. I would advocate the setting up of a permanent Economic Council of the Empire, with representatives from the different parts of the Empire, to sit all the year round in London, and to be financed by all the countries taking part in it. These economic inter-Imperial questions might constantly be under review. The work would be invaluable, and it would facilitate the work of each Imperial Conference as it came along.

With regard to primary products, I would have a completely open mind. I would let everything be discussed, and, if it were possible to make any arrangement by which we could increase in this country our consumption and purchase of the primary products from the Dominions—articles of food, or any other primary product—then I would seek to see what I could get for that, and if it were a deal that satisfied me, then I should be content. Then my duty would be—and I am speaking on the supposition that I had to meet the Conference this autum—to go straight to the country and put the whole thing to it. If I did that, you would be against me. But what a chance you have got! You have a chance which no Government ever had in this country before. You are in a happier position if you act upon what the Secretary of State for the Dominions has put forward. If you will act in the spirit of the Motion that we have put down, if you will act nationally instead of in a party spirit, then, I promise you, I will support you in this House in all that you do, and I believe I can speak for everyone on this side. You would then have what, in effect, would be a national mandate. What power could be greater than such an endorsement by the House of Commons? You need not go to the country, and by 1931 you would enter on the New Year, and the whole Empire would enter on the New Year, with a fresh hope—a hope such as it has not had in the lifetime of any one of us.

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden)

In the concluding words of his speech, the right hon. Gentleman made an offer of co-operation with this party provided we would accept his policy. It would not be difficult on any occasion for one side to get co-operation with the other provided the other were to sacrifice all its own principles and agree to accept the principles of those who had made the condition. I may say that on the condition laid down by the right hon. Gentleman there can be no co-operation between his party and ours. A good deal of the speech of the right hon. Gentleman had very little relation to the terms of the Motion which is on the Paper, but that is a feature of all the right hon. Gentleman's speeches. He seems to regard the House of Commons as an academic debating chamber, or as the classroom of a primary school at the giving of an elementary lesson.

The right hon. Gentleman has addressed a number of questions to me, but I think that after his speech Lord Beaverbrook will address a good many more questions to the right hon. Gentleman, and I am quite sure that the country too, when it reads the speech of the right hon. Gentleman, will want to know what is his present position; where he stands; what is his policy? He tells us that this Parliament is coming near to its end. It is high time then that the right hon. Gentleman and his party made up their minds where they stand and upon what policy they are going to the country. I know, of course, that if the right hon. Gentleman had definitely and clearly laid down a policy to-day that that would be no guarantee that it would be his policy and the policy of the party in seven days from now, because the right hon. Gentleman is a modern Jim Crow. He Wheels about and turns about, and does just so; And every time he wheels about, jumps Jim Crow.


We have heard it hundreds of times.


Yes, it is very old, an old nursery rhyme. The right hon Gentleman quoted from a statement which the Dominions Secretary made in this House some time ago, a statement in regard to the policy of the Government at the approaching Imperial Conference, and with that statement he expressed his entire satisfaction. If that be so, why have they put into this Vote of Censure a criticism and condemnation of the Government for having excluded from consideration the imposition of duties, and so on, upon foreign foodstuffs? According to the right hon. Gentleman, he is perfectly satisfied with the statement of Government policy at the Imperial Conference as set forth by my right hon. Friend the Dominions Secretary. [An HON. MEMBER: "Do you agree; are you satisfied?"] I will deal with that later.

The earlier part of the right hon. Gentleman's speech dealt with the question of world causes as an aggravation of the problem of unemployment, and he asked if these causes were something new, something which had arisen within comparatively recent times? There are always world causes operating and having their effect upon trade conditions and the economic and the financial position of nations, and they always will exist and act disastrously under the present chaotic capitalist system. But world crises are not new. There is such a thing as cyclical movements in trade. Some economists have written learned treatises showing that these world crises occur about every 10 or 11 years, and the right hon. Gentleman ignores altogether what has happened during the last six or nine months, and that the present condition of world trade is in a considerable measure due to the happenings of this period. I remember the right hon. Gentleman the Member for Epping (Mr. Churchill) admitting that fact in the course of a speech delivered in this House on the unemployment question only a few weeks ago. The right hon. Gentleman quoted statements which had been made in the autumn of last year. In the autumn of last year there had been no financial crisis in America. In the autumn of last year the phenomenal fall in world prices had not occurred. And it is these two factors mainly, others in a minor degree contributing, which are responsible for the present abnormal condition of world trade.

The right hon. Gentleman went on to compare unemployment in other countries with unemployment here, but there were certain comparisons which he did not make; there were certain figures which the right hon. Gentleman did not quote. He quoted comparisons of unemployment in Germany and other countries 12 months ago, but he did not give the figures of unemployment in Germany to-day. He did not give us the figures of unemployment in Italy to-day. He quoted the old case of France, and he skipped very lightly over the present condition of things in America. It is true that in America they have no official figures in regard to unemployment, but no one denies that the number of unemployed in the United States of America to-day is twice, and probably three, times the number of unemployed in this country. [HON. MEMBERS: "No"] I received, three days ago, a letter from the Notary Public at Los Angeles, a city, he said, which has a population of 1,200,000 people, and one-third of the population is out of employment to-day and business is practically at a standstill. I shall have something more to say about this later on when I come to deal with the point in this Vote of Censure which the right hon. Gentleman totally ignored.

The first claim in this Motion is that a policy of Safeguarding may ensure the home market. I want to contest that point, but before I do that I should like to refer to one or two minor points which the right hon. Gentleman made. He quoted a statement made by my right hon. Friend the Prime Minister that we were going to organise a brain. Well, if we did that it would certainly be a departure from the policy of the late Government. He went on to say that increased taxation—and I do not deny, and I never have denied it—has a psychological effect upon trade. But the right hon. Gentleman and his Government must take the main responsibility for the increased taxation which has become inevitable. The right hon. Gentleman quoted an extract from John Stuart Mill about Protectionists. Well, what is the correct inference from that quotation? The Protectionists are moved by their hearts and not by their heads.

May I say that I am going to evade nothing. I am not going to be equivocal; I am going to be perfectly straightforward. I will take, first of all, that part of the Motion which deals with the policy of the Government at the forthcoming Imperial Conference. We have often been criticised for not carrying out our Election pledges. The pamphlet from which the right hon. Gentleman quoted this afternoon is often referred to by hon. Gentlemen opposite to show how far we fall short of fulfilling the expectations which were aroused at the General Election. The right hon. Gentleman quoted from that pamphlet a very clear declaration of the attitude of the Labour party on protective duties. It was distinctly stated that we were opposed to taxation of food and that we were opposed to protective duties of the kind included in the Safeguarding proposals of the party opposite. In this respect, do the party opposite expect us to conform to or to abandon our Election policy? Having made a declaration that we were opposed to food taxes and protective duties, do the party opposite now ask us to impose food taxes? Do they ask us, as indeed they do in this Vote of Censure, to carry out a policy of Safeguarding? Well, if they want an answer to that, I will give them an answer. We shall do no such thing. We shall be no party—[HON. MEMBERS: "Who are we?"] I am speaking for the Government. We shall be no party to the imposition of food taxes, of taxes upon raw materials or of protective duties.

We shall enter the Imperial Conference barring no question from discussion, but it will be made abundantly clear, as I have said just now, that we shall approve no final conclusion which involves this country in a food taxation policy or a general Protectionist policy. Outside that, there are plenty of questions of great importance which the Imperial Conference can discuss. I believe some Dominions have already handed in for consideration at the Conference the question of bulk purchases. There is the question of import boards. If those questions be raised, we shall discuss them with an open mind, without prejudice, and, if upon either or both of these matters a practical policy can be agreed upon, then we shall be prepared to accept it. The only thing that I would say in regard to import boards is this, that it is a matter to which the Government have given long consideration for the practical difficulties are great. But if this question is considered solely from the point of view of the interests of the producer, that is, the exploitation of the consumer by the producer, then any such scheme is foredoomed to failure.

I have stated as plainly as I possibly could what our policy at the Conference will be. The right hon. Gentleman said that if he were going to the Conference he would offer to the Dominions, Safeguarding. How in the world is Safeguarding going to help the Dominions? With the exception of Canada, no Dominion sends manufactured articles to this country. Suppose that you encouraged by duties, or by a tariff, the importation of Canadian manufactures into this country, how is that going to help the British manufacturers? A day or two ago I saw a statement made by the chairman of Guest, Keen and Nettlefold, in which he said that there had recently been imported into South Wales pig iron from India at a price below the cost of manufacture in South Wales. How are you going to deal with a question like that under your Safeguarding proposals, under your policy of Empire protection, under which all Empire produce is to be admitted into this country, free? Are you still going to permit India to send pig iron into this country at a price below the cost of production here? Is that the policy that the right hon. Gentleman would put before the Imperial Conference if he were in our position?

I turn now to the first part of this Vote of Censure which says that a return to prosperity can best be promoted by safeguarding the home market against unfair foreign competition. I had hoped that the right hon. Gentleman would have explained what he means by "unfair competition." What does he mean by "unfair competition"? Does he mean lower wages in other countries? Does he mean imports that are supported by bounties in the country of production? If he means either or both of those things and if a policy can be devised for stopping imports into this country which are produced under conditions in regard to wages which are inferior to those in this country, or imports which are entirely free from bounty, then all imports into this country, practically, except from the United States of America, would be completely stopped. How is this going to touch the Dominions? Australian exports are very largely bounty fed. It is that bounty policy in Australia which is in a considerable measure responsible for their present trade, economic and financial condition. The only country in the world with which we could have trade relations if unfair conditions in other countries are to be a barrier to the importations of goods would be the United States of America. [Interruption.] Certainly, and we being in an inferior position in regard to wages would be altogether debarred from trade with them.

There is an Amendment on the Order Paper in the name of some of my hon. Friends, which demands that the restoration of British industry should be brought about by proposals of a, very comprehensive character. It is to one phrase in that Amendment that I want to call attention. It records the conviction that neither Free Trade nor Protection is a remedy. What is meant by "remedy"? That is an expression that we very often hear. If Free Trade means free competition in industry, no control of industry, no organisation of industry, then I am not a Free Trader, and I doubt if there be a Free Trader living of that kind. I believe with a very sound Free Trader, the late Lord Morley, that free competition is not a principle to which the regulation of industry can be safely entrusted, but it is not in that wide sense that we are discussing Free Trade to-day. We are discussing it in the sense of tariffs, and whether the imposition of tariffs in this country would, as this Vote of Censure says, restore prosperity to industry. I want for a moment to deal with that. An ounce of fact is worth a ton of theory, and the test of policy is practical experience.

This country has built up its enormous foreign trade and its industrial preeminence by the policy of Free Trade in the sense in which I have just stated it. The right hon. Gentleman quoted figures with regard to Germany. Figures were given the other day by my right hon. Friend the President of the Board of Trade in reply to a question in regard to the amount of foreign export trade per head of the population of three or four of the principal commercial countries. What was that answer? That the export trade of this little country per head of its population was double that of the other three countries. We have had during the last three years an average of £700,000,000 worth of exports from this country, and we did That with higher wages and better labour conditions than in any of the protected countries on the Continent. We have social services costing something like £200,000,000 a year, which they have not, and which are an addition to the remuneration of our people.

The Vote of Censure says that the home market can best be safeguarded by Protection. There seems to be an impression in the minds of the party opposite that we have not got the home market now. Let me give two or three instances. Take engineering. Judging from the speeches of the party opposite and from the number of questions that are put to Ministers on this subject, one would infer that the foreigners have completely captured the whole market here in engineering. What are the facts? According to the census of production, we have 90 per cent. of the home market for our home production in engineering. Take cotton. There is a miserable importation per year of £10,000,000 worth of cotton goods, specialities which the manufacturers in this country would never think of producing even in times of worst depression. £40,000,000 worth of cotton goods were retained in the home market, and we sent last year £135,000,000 worth of cotton goods abroad. Take wool. Half of the wool textile products are sent abroad, while £50,000,000 worth are retained at home. The total imports are about £13,000,000 worth, therefore we not only keep the vast bulk of the home market but we supply foreign markets to the average of £700,000,000 worth a year.

I hope the House will pay particular attention to what I am about to say now because, in my view, this one fact alone needs no addition as a complete answer to the protectionist case. It is the position of the United States of America. The United States of America exported manufactures last year to the value of £562,000,000 and we exported manufactured articles to the value of £583,000,000—more than the United States of America and more than twice that of any other great foreign nation per head. We imported manufactured articles to the value of £335,000,000 while the United States of America, which has the policy that we are asked to adopt as a means of bringing prosperity to the home market, has the highest protective tariff in the world. Has that tariff secured the home market for the United States? Last year the United States imported more manufactured articles than we imported into this country. A statement we often hear from the party opposite is that imports throw British workmen out of work. If that be so what happened to the United States last year when they imported £373,000,000 worth of foreign manufactures?

Lieut.-Colonel Sir FREDERICK HALL

And twice our population.


We export nearly twice as many goods of manufactured classes as we import and, therefore, if there was anything in the fantastic statement about imports depriving workmen at home of employment we are taking work from two foreigners for every British workman who is displaced. If exports be dumping then we are the greatest dumpers in the world. I have often heard the hon. and gallant Member for Bournemouth (Sir H. Croft) say that if it is right and beneficent to import foreign goods why not import foreign workmen to do the work here. The answer to that question ought to be obvious on the surface. If you bring a foreign workman into this country to take the job of a British workman he puts the British workman out of employment, but if the foreign worker produces goods in his own country to send them here he is providing employment for a British workman. [Interruption.] I can quite understand the hilarity of hon. Members opposite, because anyone who would make the statement which I have quoted is quite incapable of understanding the argument.

Turn again to the point made by the right hon. Gentleman in regard to the world position. If this country alone were suffering from bad trade and unemployment then I admit there would be a prima facie case for inquiry as to whether our different fiscal policy was not in large measure responsible. If, as is claimed in this Vote of Censure, Protection will secure the home market and prevent unemployment, if it had done it elsewhere, there could be no defence for the present fiscal policy of this country. But all the facts are against it. The two newest countries in the world, the United States of America and Australia, with inexhaustible natural resources, are to-day suffering more from trade depression and unemployment than any countries in the world; and they are the most highly protected countries in the world. I am not going to enter into the question in any detail as to what has happened under the little experiments in Safeguarding we have had during the last five years. It is no use quibbling as to whether in one of these protected industries the number of persons employed has risen by 100 or fallen by 100. There is one broad fact which is indisputable, and it is this: that you cannot point in any of these safeguarded industries to any marked effect which these duties have had in improving the condition of the trade. One fact which we do know and which is beyond dispute, because we have it upon the authority of the employers themselves, is that in the lace trade the effect of the duty has been in the Leaver section to send 25 per cent. of the manufacturers into bankruptcy or liquidation and to reduce the number of machines by 25 per cent. With regard to artificial silk, the condition of that industry is known to everyone who follows the reports about that industry—






The right hon. Gentleman does not give way and the hon. Member should resume his seat.


On a point of Order.


Does the hon. Member rise to a point of Order?


Yes. A definite statement has been made regarding the industry with which I am closely connected, which is not only a partial statement but entirely contrary to the facts. If the right hon. Gentleman will give way I shall be able to supplement my statement.


That is not a point of Order. The hon. Member will have an opportunity of explaining later in the debate.


One of the most disquieting things in connection with these Safeguarding Duties is the inability of the Board of Trade to get statistics and returns from these companies. They have made repeated inquiries but they cannot get them, and that in itself is an evidence of the inefficiency of the industry. I turn now to that part of the Vote of Censure which deals with what I may call Empire Free Trade. I have had supplied by the Central Conservative Office, over which I believe the right hon. Member for Edgbaston (Mr. Chamberlain now presides, with a brief against Empire Free Trade. I am not going to deal with it at great length, but I will summarise it. This brief from the Conservative headquarters says, first of all, that it is no use talking about Empire Free Trade because the Dominions will not have it, and the right hon. Gentleman who has submitted this Vote of Censure says the same thing. This is what he said as recently as last February. Of course, I know that that is a long time ago, and he has said a great many things since then on this matter; but in February he said: As a practical policy, however, Empire Free Trade is impossible and no responsible statesman will go to the country and tell the electorate that it will be introduced if he were returned to power. It cannot be done. The Dominions will not have it, and they have said so in the clearest terms. In the face of such declarations from the Dominions, declarations in which they are in complete unanimity, no political party in this country can honestly adopt Empire Free Trade as a platform on which to fight the next General Election. Therefore, I think I may say that any Tory candidate who stands at the next election upon that policy is not only dishonest, according to the right hon. Gentleman, but to use his own elegant phrase he will be a stinking candidate. My Tory brief goes on to say that the Dominions and the Colonies cannot possibly accept it because it would mean the sacrifice of a large part of their revenues; that we should have to denounce commercial treaties which are very valuable to this country, and then, most disastrous of all, this Tory brief says that this policy would tend to disunite the various parts of the Empire. It also deals with the point I have just made, that if you are going to encourage the importation of wheat from the Dominions, how is that going to help the British farmer? The other parts of the British Empire are increasingly, and must be so, dependent on their trade outside the Empire. Are they going to sacrifice what may be called their foreign trade for the sake of any little advantage that we might give them in this market.

5.0 p.m.

There is another point which is not very often made but which is of considerable importance. Hon. Members opposite are always talking about the possibility of increasing Dominion trade. It is the Dominions upon which constantly and almost exclusively they fix their eyes. There is no possibility within a reasonable time of any considerable increase in the trade with the Dominions. They have practically for the time being reached saturation point. The increase in their population is not more than 2 per cent.; and the two great British Dominions which have hitherto provided for emigrants from this country, Canada and Australia, have practically closed their doors. I put this question: Are they going to sacrifice what is the larger part of their trade, that is with foreign countries, for the sake of any little advantage that they might hope to get by an extension of their market here? They cannot Canada last year took from this country less than £40,000,000 worth of goods, but she sent to the United States over £100,000,000 worth of goods.


What did she take from the United States?


Is Canada going to fall in with any plan which would involve the sacrifice of that huge trade with the United States? Not much! Take Australia. Australia sent to this country £52,000,000 of goods. She sent to foreign countries £68,000,000. And this is very important in that connection: Her main export is wool. We could not under any conceivable circumstances take the whole of the Australian wool. We take £20,000,000 worth of the crop, but she sends £42,000,000 worth of the crop to foreign countries. Those are facts. I will take another which has a bearing on this, and it is well within the knowledge of everyone who talks to an Australian—an ordinary Australian or an Australian statesman. They tell you in the plainest terms that their purpose is to build up their own manufacturing industries in Australia. They have put it to me as plainly as this: "We are imposing these high tariffs to keep out British imports in order to force British manufacturers to bring their factories into Australia."

That is their deliberate policy, and they are pursuing it most ruthlessly. I am not blaming them, but simply stating the facts. What have they done since 1925? Have they pursued a policy which lends encouragement to the expectation that we can make reciprocal trade agreements which would alter the policy of Australia? There has been a constant succession of tariff increases. Take British hosiery. On British hosiery they put—and this is a preferential rate—a tariff of 50 per cent. Since that tariff was imposed our exports of hosiery goods to Australia have fallen from £516,000 to £278,000. It is the same with regard to cotton goods. Before 1925 they were admitted free. Now Australia imposes a duty of 45 per cent. for that very purpose—to encourage Lancashire cotton manufacturers to bring their mills to Australia. It is the same with woollens and worsteds. There is a duty of 45 per cent., and as a consequence our exports to Australia of woollen goods have fallen from £3,000,000 in 1924 to just over £1,000,000 last year.

There are just two other points to which I wish to refer to, arising out of this Vote of Censure. I remind the House once more that it asserts that Safeguarding will secure the home market and bring prosperity to British trade. But that is not the inwardness of this Protectionist campaign. The real motive and purpose of it is hidden. You cannot go amongst Tory business men without hearing that costs of production are too high, that wages are too high, that wages must come down. Taxation, the right hon. Gentleman said, is too high; the Income Tax is too high. That is the inwardness of this Protectionst campaign. It is an attack upon wages. They dare not make a frontal attack on wages, so by Protection they are seeking to reduce the real value of wages. The right hon. Gentleman himself has repeatedly given support to that fact. In one of his latest speeches he called attention to the low wages in Protectionist countries. I think perhaps of the greatest difficulties we have to face is the lower standard of labour on the Continent of Europe. If we take real wages and fix the standard as 100 for our country, we have a corresponding figure for Berlin of 68, in Milan 46, in Warsaw 47 and in Prage 50. The greatest difficulty we have to face is the lower wages in Protectionist countries. Taxation is too high. The right hon. Gentleman told us so this afternoon. But the right hon. Member for Epping (Mr. Churchill), in the course of our long debates on the Budget a few weeks ago, suggested import taxes as a substitute for direct taxation. There you have it. Put £100,000,000 of taxation upon the articles which are in common use and reduce the Income Tax by 2s. in the £. That is what this means. All this talk about Safeguarding encouraging British industry and securing the home market is all a screen to hide the real purpose which is behind it.

We shall face the Division upon this issue with perfect confidence, and when the General Election comes—if the party opposite by then have reconciled their differences so as to present an agreed policy to the country, and if it be this policy—we shall face the country with equal confidence. The country has had to face this issue before. I know that the present conditions are favourable to the campaign of Protection. Mr. Bonar Law made the statement that it needed only three years of bad trade to convert the country to Protection. The late Mr. Joseph Chamberlain started his campaign during a period of trade depression, but in a year or two the ruined industries had miraculously recovered. Of course, when a person is suffering from some ailment, some illness, some disorder, he flies to every and any quack remedy that anybody can suggest. We are told that our fiscal policy, Cobdenism, is a discredited policy. But Cobdenism, as they call it, arose out of the failure and the discredit of Protection.

It is not our policy which is the old policy; it is Protection which is the old policy. It has been tried and has been found disastrous, and there can be no disputing the fact that the present world trade depression is in a very large measure due to the tariffs of other countries. The remedy of hon. Members opposite, when a person is being poisoned by certain medicines, is to increase the dose of the poison. Let me just add this in proof of what I said just now in regard to world trade depression being due to the tariffs of other countries. It must be so. Take those figures which were given by the right hon. Gentleman opposite as to wages in protected countries. They show that they have a low purchasing power and that is what the world is suffering from to-day—the low purchasing power of tens and hundreds of millions. Tariffs produce this. The same thing is happening in America just now. The cost of living has gone up by 10 per cent. as a result of the tariff which has just come into operation, reducing the general purchasing power of the people by that amount. Adopt the policy which is suggested by the other side, and not only real wages but actual wages would be reduced to the level of those in Protectionist countries, with disastrous consequences upon our trade.


I do not propose to detain the House—[HON. MEMBERS: "Hear, hear!"] It is a source of satisfaction to me to find with what gratitude that remark is received by hon. Gentlemen opposite, but I only rise because I was astonished at the temerity of the right hon. Gentleman in his concluding remarks, especially when he attributed to us the desire to bring about a reduction of wages. One thought crossed my mind during that part of the right hon. Gentleman's speech, which may not have been absent from the minds of hon. Members on this side or from hon. Gentlemen opposite who have minds also, and that is, that in the case of the only two industries in regard to which this Government has directed an inquiry to be made, and into which it has made inquiries, without the fiscal weapon it has through its own committees been forced to effect a reduction of wages. At the time of the disastrous Election of last year, which this country is regretting more deeply every day, we were on the eve of doing something by way of the fiscal method for the textile trade—[An HON. MEMBER: "You are always on the eve!"] That method was ruled out by the policy which we have heard adumbrated to-day by the Chancellor of the Exchequer and the result has been that, unable to use the fiscal weapon, they have been driven, as the Macmillan Committee effectively showed, to use the only other possible alternative—a direct reduction of wages. They have been forced by the inexorable logic of their own creed to adopt exactly the same method in regard to the cotton industry, and so, it ill becomes the right hon. Gentleman to say that this party is proposing a remedy which is going to make a reduction in wages.

I rise chiefly for the purpose of correcting a misapprehension which may result from most misleading figures which have been given to the House by the right hon. Gentleman—figures so striking and so misleading that it was indeed fortunate that I, who had not intended to inflict myself upon the House, had in my possession other figures which actually refute everything said by the right hon. Gentleman. Let me remind the House of what the right hon. Gentleman said. He said that the effect of the Safeguarding Duty upon the lace industry had been to drive 25 per cent. of the manufacturers in the Leaver's lace section into bankruptcy. It is with that section of the industry that I now propose to deal. What an extraordinarily false picture that statement gives to the House of the facts. I have the complete figures supplied to the Board of Trade, and I find that on 1st July, 1925, a Safeguarding Duty was imposed upon lace. At that date there were 101 separate manufacturers in the lace industry. In 1929 there were 72 separate manufacturers. That is a reduction of something like 25 per cent., as the right hon. Gentleman said. He also said that it had driven a certain number of machines out of action—I think 25 per cent. On 30th June, 1925, there were 1,120 machines operating in the Leaver's lace section, and that number had been reduced to 823 in 1929, so that the right hon. Gentleman is right in saying that the number of manufacturers and the number of machines have been reduced. But the House will forgive me for calling attention to what the right hon. Gentleman has suppressed, namely, that the number of employés at those machines increased from 1,524 to 1,644, and the amount of wages and salaries paid to those operatives increased £42,296 to £55,800, and that the number of single racks, of 1,920 motions per rack increased from 499,490 to 673,828.


Head the note above.


The note is: The diminution in the number of manufacturers is due to liquidations or to their having ceased to trade. [Laughter.] I hope that hon. Members who display so much amusement will do me the honour of listening to the conclusion of my argument. These figures supply the strongest possible arguments for the efficacy of Safeguarding. What do they show? They show that under Safeguarding this industry has rationalised itself. It has crushed out, by inexorable economic law, uneconomic producers. They have been reduced by 25 per cent. and the excessive number of uneconomically operated machines has been reduced by 25 per cent. But the total output, as represented by the number of rack motions, has increased from 500,000 to 673,000; wages and salaries have increased, and the number of people employed have increased. Looking at those figures with impartial and scientific eyes, they supply the strongest possible argument for the efficacy of Safeguarding in enabling an industry which had been depressed almost to extinction to rationalise itself, and compete once again in the world market.

As against that result, what was the condition of the industry when the duty was imposed? At that time no fewer than 30,000 people had left the industry in a period of 10 years—at the rate of 3,000 a year. I speak in round figures and from memory, but the House can rely on the fair accuracy of what I am saying. Between 1920 and 1925 when the duty was imposed the amount of imports increased ten-fold. There was £260,000 worth of lace imported into this country in 1920, and £2,600,000 worth in 1926, and the exports during that period declined by almost as astonishing a proportion. We have those two facts on record when considering the effect of the duty upon this industry—an industry which was almost down and out and which had been witnessing this enormous influx of foreign materials and this extraordinary shrinkage of exports. Of that industry it is true to say that at the end of five years of Safeguarding the fall in the number of employed persons, which had amounted to 3,000 a year, had been entirely wiped out. At the end of the five years there were only 55 fewer people employed in the industry than there were in 1925 when the duty was put on, and these people were employed at full time, whereas the right hon. Gentleman knows, and the President of the Board of Trade will correct me if I am wrong, at the time the duty was put on they were not working full time, but about five and a-half hours short time per person, per week. If we allow for the additional time worked there is a real increase in the number of people employed.

So far from the lace industry offering any balm to the Cobdenistic heart of the right hon. Gentleman, it will, if he examines the figures with care and fairness, prove to be the Waterloo of the antiquated creed which he so eloquently expounded this afternoon. We have listened to a speech which one can fairly say causes the right hon. Gentleman to date perfectly definitely. We might have been listening to a speech delivered in the middle of the last century, and not in a world in which the whole circumstances have altered, and in which the whole basis of his argument has been swept away. It would have been a perfectly good speech and the right hon. Gentleman's arguments would have been perfectly reasonable arguments at a time when we were the pioneer manufacturing nation of the world, and had a practical monopoly of the world's fuel supply and when there were no alternatives to that fuel supply such as oil, and water power, and hydro-electric power, as used in all parts of Europe to-day. But his argument is wholly inappropriate to the present day when the machine can be operated all over the world with almost equal efficiency and when the degree of skill which made us the pioneer manufacturing nation in the last century is not required. The right hon. Gentleman seems to have forgotten this enormous increase in manufacturing activity which puts the whole of Europe, at a lower wage-rate, upon an equal level of capacity as regards output with us.

What we say is that civilisation to-day, not only the civilisation of this country but civilisation as a whole, has to find some method of rationalising the output of the machine. If we do not do that, the machine will destroy us as certainly as the machine in the famous story. All these considerations must be absent from the mind of the right hon. Gentleman. According to his argument we are to be the one free dumping ground on God's earth into which the machine can spew out its glut of manufactured goods. Consumption is vastly below demand, taking the world as a whole. I had occasion a year ago to deal, professionally, with statistics concerning one of the great silk cartels of the world which is centred in this country, and I was assured by the technical experts connected with that cartel, that it alone was capable of producing enough silk stockings to provide two pairs for every inhabitant of the universe—man, woman and child, Hottentot and Aryan. That is the kind of situation we are up against, and what practical proposal has been made as an alternative to our proposal to deal with that situation? Talk about rationalising the machine! How can that be done as long as it goes on pouring out its surplus extravagant production into this country?

The right hon. Gentleman concluded with an argument which was specious to a degree. He said that other countries suffered under tariffs, and asked why then should we impose tariffs? Would he apply that argument to armaments? Would he contemplate us as an arms-free nation, in a wholly armed world? But that is the condition in which, economically, we stand with tariff barriers raised against us by almost every other manufacturing nation in the world. I would point out, finally, the necessity for, and the hope of, at long last, coagulating all parties in an attempt to get away from this barren fiscal issue. We are faced at the present time with the possibility of entering into one or other of two types of alignment among the nations. The day of the large-scale amalgamation has come, not only in industry but among nations. The nations will have to rationalise their output and fit in to one or other (of the groupings of nations which will be necessary in order to control the output of the machine. The proposals of M. Briand in France indicate that that is the direction in which European minds are turning. We have a chance of entering into the European array of nations. The proposals of Lord Beaverbrook with which many of us on this side do not by any means whole heartedly agree—[HON. MEMBERS: "Oh!"] I have never made any bones about my disagreement with many of the proposals of Lord Beaverbrook and I never shall; but however one looks at them they show another method of entering into a grouping of nations and so rationalising output, and getting the benefit of extended markets and controlled markets within an area or ring.

From either of these groupings we, under our present fiscal system, are entirely excluded. We are the one nation which is out of step with any grouping you can suppose, whether Imperial or European. The dictum which has been laid down in final terms to-day by the Chancellor of the Exchequer, excludes us from co-operation with the nations of Europe, at the same time as it excludes us from any closer approximation to an Imperial ring. It is for that reason, if for no other that we on this side have heard with the greatest possible dismay, on Imperial grounds, that the door is to be banged and bolted in the way it has been this afternoon, so as to render the proceedings of the forthcoming Imperial Conference a barren farce, and one which can give no prospect of that greater Imperial expansion which everybody in this House, and, I venture to think in the country, was looking forward to seeing as a development from that Conference.


I regret that I did not hear the first part of the speech of the hon. and learned Member for Central Nottingham (Mr. O'Connor), but I have no doubt, from what I have heard of the concluding part of his speech, that he has presented his case very skilfully. But he presented it just as skilfully on the other side when he was Member for Luton, and when he boasted that he had done his very best to limit the application of the Lace Duty in reference to certain articles of consumption in his constituency.


The right hon. Gentleman has been misled. That statement has been made before. It was in fact a quotation from the chairman of the Liberal Association at Luton, which was quoted in turn by me, and which was passed on as having been my words.


I know, but the hon. and learned Gentleman, when he was Member for Luton, did not repudiate the statement. He postponed the statement in that respect until he went to a different constituency. It would have been far more interesting to hear the hon. and learned Gentleman on the second part of the Motion of his Leader, that part which condemns the Government because they are not committing themselves to food taxation. The right hon. Gentleman gave an account of what would happen if he had been presiding over the Imperial Conference, and he said, "This is what I would have said." It would be rather interesting to know what the hon. and learned Gentleman would have said if he had been presiding. Would he have begun by saying, as he said at Nottingham, "I am against food taxes"? If he would, he certainly ought not to vote for this Motion of Censure which has been introduced by his Leader.

Of the many Votes of Censure which I have seen in this House, including some Votes of Censure to which I have been subjected myself, this, I think, is the most extraordinary and inexplicable. The Leader of the Opposition, in introducing it, quoted with approval a statement by the Minister who is to take charge of the Imperial Conference, and said he would not say anything beyond that, and yet he condemns the Government because they are not prepared to say something that the right hon. Gentleman himself has constantly repudiated. In this Motion he condemns the Government because they have excluded the taxation of foreign food. So has he, and he is condemning them for doing exactly what he has repeatedly done himself, in many speeches. If not, what is the quarrel between him and Lord Beaverbrook? You move a Vote of Censure on a Government because they have done the things that they ought not to have done or because they have left undone the things that they ought to have done, but they are now to be censured because they have not done something which the right hon. Gentleman himself has repeatedly said he would not do.

He has asked two questions—What path are the Government going to take on these subjects? And, secondly, What are they going to do? He has announced that a general election will come very soon. It is therefore a matter of very great interest, and as he also announced the other day that he and his party were going to be the alternative, he should answer those two questions himself. What path is he pursuing? What is he going to do? He has not said so to-day. I noted down very carefully the path he would have pursued at the Imperial Conference. He would have given them an assurance that there would be a preference on existing taxation. Personally, I am in favour of that. Then, Imperial rationalisation. I do not know of anybody who objects to that. The next was that there should be a permanent Economic Council of the Empire. That has been suggested by the Trade Union Conference, and that is an admirable idea. But the next is one that I cannot understand. He said that somehow or other we are to guarantee an increased consumption of the primary products of the Dominions. How? We are to go and say "We are going to consume more of your primary products." By means of the Empire Marketing Board, we are doing it.

Why did he not explain to the House of Commons what he meant? It is because he does not know what he means. He has altered his position so frequently, he has turned round so rapidly—and so have hon. Members behind him—and so often that he has become perfectly muzzy. Let us see what the right hon. Gentleman's position is, because it is just as vital to us to know his position as that of the Government. The position of the Government has been made very plain indeed by the Chancellor of the Exchequer. Let us see what the position of the right hon. Gentleman is. I am not going to say that the right hon. Gentleman is bound by statements which he made before the last election. After all, when a party is defeated at an election, when the issue they submitted to the electorate is not sufficiently attractive they are entitled to put in a few more appetizing ingredients. Therefore, I am only going to quote what the right hon. Gentleman has said since the election.

There was an election at Twickenham. The hon. Gentleman who is now the Member for Twickenham (Sir J. Ferguson) was showing a disposition to go off the deep end, and he had to be hauled ashore. The right hon. Gentleman wrote a letter, and this is the letter that he wrote to the Conservative candidate at the Twickenham by-election: When proposals involving taxation of foodstuffs are put forward, I feel bound to point out that such a policy is contrary, not only to your own election address, but also to the declared policy of our party. Does that stand now? The right hon. Gentleman said, "Where do you stand? What are you going to do? What path will you pursue?" I ask the right hon. Gentleman. Does he stand where he stood when he wrote that letter? He made a speech about a fortnight ago, a very heroic speech, in which he hurled defiance against the Press lords, and he said, "I stand where I did." What does that mean? The right hon. Gentleman stands on a sliding staircase. He has not moved, but he has been moved. He has been pushed about very badly by his followers, by some very recalcitrant followers, no doubt, but he has been pushed along. First of all, there was a move with regard to the Referendum. That was an abandonment of the position which he took in the Twickenham election, when he was going to have no food taxes. He was going to a conference after the election with the Dominions upon the basis of submitting to them a possibility of food taxation, in return for something else, provided it was referred to the electorate of this country.

Where is the Referendum now? Does that stand where it did? Is that in the same position as it was? The right hon. Gentleman has not said one single word about it to-day, and it is important that we should know exactly what it is that he means to do about food taxation before the next election. [Interruption.] He is the alternative. [Interruption.] Hon. Members above the Gangway must learn to listen. They interrupted the right hon. Gentleman the Chancellor of the Exchequer at every turn. On the other hand, the right hon. Gentleman the Leader of the Opposition had absolute quietness. What is the position with regard to the Referendum? There, the right hon. Gentleman had committed himself to the proposal of a Referendum, but it has been thrown over by the gentleman with whom he made the bargain, and it was a very humiliating position for the right hon. Gentleman. There he was, tied to Lord Beaverbrook, running a three-legged race; it was humiliating, it was undignified, and it was rather painful and he has abandoned it in substance. But where does he stand now?

He wants the Government to be perfectly straightforward upon that subject. Why is he not straightforward with the public on that subject? At the coming election, which he has announced to-day, he is going to the electorate of this country, and he is going to ask them for certain powers, for certain authority. Does that include the taxation of the food of the people? It is unfair; it lacks straighforwardness; to use the words of the right hon. Gentleman man himself, it is not honest for him to conceal, before he goes to the election, what the party sitting there are prepared to do if they happen to be the alternative Government next time, and I think we are entitled to ask him that. There was the first position—no food taxes at all. There was the second position—food taxes were to be subject to a Referendum. There has been a surrender, but how far? He has hoisted the white flag at half-mast. How far is he going?

As a matter of fact, it is quite unintelligible why this Motion was moved at all. I cannot see the point. We have had debates upon Safeguarding, and we have had debates upon Protection, one of them led by the right hon. Gentleman the Member for Edgbaston (Mr. Neville Chamberlain), when he stated the case quite fully. We have had several debates. Why is this moved now? It is not aimed at the Government at all. It is the autumnal manœuvres of the Conservative party in advance. They are not to be held. Why not? It would be dangerous. They might fire on each other, and with ball cartridge, and some body might get killed—perhaps the right hon. Gentleman himself. Therefore, something has to be done in order to show that the army is in training, and that it is ready to fight. It has not a clear notion of what it is going to fight for, but it is going to fight. Whether it is going to fight Lord Beaverbrook or Lord Rothermere or the Socialist party upon this particular matter, they are not in the least clear, and this debate has been raised purely and simply, not in order to have a bona, fide discussion upon these subjects, but as part of the manœuvres—[Interruption.] The hon. Gentleman must learn to be civil.

The right hon. Gentleman has told us that the situation is a very grave one, and who can deny that when we are on the eve of having 2,000,000 unemployed, when we have a very serious fall in our exports, when anyone who looks at the weekly traffic returns can see that there is not merely a fall in exports, but a very serious fall in the production in the home market? It is a very grave position, and it is a situation that calls for examination, notably by the House of Commons which represents the nation. It ought not to be examined merely as part of a party manœuvre in order to solve difficulties inside a party. [HON. MEMBERS: "Oh!"] What is the use of pretending It ought to be examined from the point of view of the grave and momentous national issues which are involved in it. I was hoping that the right hon. Gentleman would have done it quite candidly and straightforwardly.

The only contribution which he has made to the solution of our very serious national crisis is, first of all, Safeguarding. The Chancellor of the Exchequer has disposed of that very effectively, and I think that that will be the general opinion of the House I will say this about it. Probably, if you give exclusive protection to a single industry, it is bound to assist it, because you are doing it at the expense of the community. That is really not the issue. The question is whether, if you make it general, the community as a whole will suffer; but, whatever you may think about it, there is no man in his senses who would say that Safeguarding is an adequate remedy for the condition of things with which we are confronted at the present moment. Even Protection is not saving other great countries from what we are enduring.

What is the other proposal put forward by the right hon. Gentleman? That you could simply go to the Imperial Conference and ask a few questions, committing yourself to nothing. If he means that the Government should commit themselves to a tax on food, he ought to say so. He will not take the responsibility of saying so, and how can he expect the Government to say so? He has already, in those letters which have been quoted by the Chancellor of the Exchequer, made it perfectly clear that he is opposed to it. He does not believe in it; he thinks that it would not work. I have a little document here; it was printed in a paper called "Home and Empire"—the first issue—it is a very attractive name, and it ought to be a good seller for the first issue. In the quotations that have been made by the Chancellor of the Exchequer the right hon. Gentleman said that the Dominions will not have it, that no honest statesman will put it forward, and that it would mislead the country to do so. He ends up by saying: I am compelled in all honesty to point out these obstacles. That was in March of this year, not February. It was a month later, and that makes all the difference in the attitude of the right hon. Gentleman. Up to the end of March, when he was in favour of the Referendum, he was still saying, "It is no use your making these proposals; the Dominions will not have them." Yet he wants to move a solemn Vote of Censure on the Government of the day because they are not proposing something which he himself says no honest man would ever propose. It is quite unnecessary to argue that position, because the right hon. Gentleman has stated it. What, according to him, has the Dominions Secretary to say? Is he to go to the Conference and say, "If we put a tax upon all foreign food, will you let our goods in?" The first thing they will say is, "Yes, if we let your goods in, will you tax all food?" Thus each asks the other a question. The Dominion statesmen have their electoral difficulties like everybody else. They know perfectly well that they cannot make concessions in respect of our goods in the eastern provinces of Canada or in Australia; they certainly cannot make them upon a conjectural promise, upon a promise which is dependent upon what happens at a General Election or a Referendum.

Anybody knows that a proposal of that kind is perfectly absurd, and to that extent I am entirely in agreement with the position of Lord Beaverbrook, namely, that it is no use your going to the Imperial Conference and saying, "If you do so and so, we will submit it to the electorate." It would put them in an impossible position, and they would have to quarrel with powerful interests in their own countries without giving them any bargain which is a firm one. There is no sensible politician or responsible Prime Minister in any of the Dominions who would ever dream of doing that. The right hon. Gentleman has asked the House of Commons to face the position frankly. I ask him to do it. He knows perfectly well that it is trifling with the Dominions and the Colonies to ask them, upon a highly problematic promise which might never materialise, to quarrel with, perhaps, some of the most powerful supporters in their own electorate, without giving anything in return. He has got to face that problem. He has to decide whether he will say openly to the electorate of this country, "I mean to tax food," and then go to the Imperial Conference and say, "I have full power to tax food"; but what he is doing at present is merely trifling with the situation.

So far as Empire Free Trade is concerned, therefore, the right hon. Gentleman has given it the go-by. He has not expounded the most important and most interesting part of this Motion, the part in which the country is really interested. He has not stated his position. There is no man on either side of the House, and no hon. Gentleman sitting behind the right hon. Gentleman, who knows better to-day what the right hon. Gentleman is going to do than he did 24 hours ago. That is really rather trifling with the House of Commons and with the country. I ask the right hon. Gentleman and the House if there is any other contribution that he or hon. Members sitting behind him are to make to a solution of our trade difficulties? I am not opposed to a re-examination, to a review of the trade position and trade methods, and to considering every problem. The right hon. Gentleman says that he would not go into this Conference because things were ruled out. They have never been specifically ruled out. I made a declaration in this House that as far as I was concerned, I certainly would not object to a full discussion upon any proposal. In 1907 I went to the first Imperial Conference which I ever attended on behalf of a Free Trade Government, and most of the time was taken in a discussion upon Protection. It was raised by the Prime Minister of Australia. We never said, "We are Free Traders, and we rule that out." Mr. Asquith, who was Chancellor of the Exchequer then, was present. We never attempted to exclude the discussion. The Prime Minister of Australia made a great many speeches, and we made speeches in reply. I have never heard that the Prime Minister has ever said that he is going to exclude the discussion of any problem. He is perfectly right in saying, "I am against it; that is not my opinion, but as far as I am concerned, I am willing to admit any subject for discussion." Therefore, the excuse given by the right hon. Gentleman for refusing to co-operate at a moment of very grave crisis, not merely in the history of this country but in the history of the whole trade and industrial conditions of the world, is quite inadequate.

6.0 p.m.

I know that there have been vital changes since the War. I am not going to pretend that conditions are identical with what they were before the War. There are two or three very vital changes. There is, first of all, the great growth of national self-consciousness throughout the world, which has vitalised the efforts of the various countries in the matter of production. There has been the improvement in machinery, which has stimulated production beyond the demands of the consumers. There is another very important change; it is that for the first time we have undoubtedly fallen into the second position as a lending country. That is very important from the point of view of trade. Before the War we were practically the only great lending country in the world: we lent in the aggregate about £4,000,000,000 sterling. The United States since the War, and including, perhaps, the last two years of the War, has lent already between £6,000,000,000 and £7,000,000,000. The increase in her exports corresponds almost to the dollar to the amount that she has lent to other countries. It has nothing to do with either Free Trade or Protection. She has stimulated her exports by means of her own cash. At any rate, those Are matters that require consideration. Are we to confine the whole examination to questions which are purely controversial and mere party slogans 4 Are we not going to consider improved marketing? The great Commission which was appointed in 1924, and sat for four years, reported that this was one of the most vital matters as far as trade is concerned. It is very significant that the Commission never recommended tariffs, although there were men of every party on it. Improved marketing is one of the things that the cotton inquiry recommended. There is no doubt that improved marketing arrangements would add appreciably to our exports abroad.

When we come to agriculture, which we always forget is far and away the most important industry from the point of view of production and the number of people employed—it would justify even a sacrifice on the part of the country to restore that industry to prosperity—we find the worst marketing system in the world. It is ramshackle, sporadic, not organised in the least. One can get so much money for a product in this county; go to the next county, and you get only half as much for it. There is no organisation of any kind—or in so far as there is any organisation for agricultural products in this country, it is an organisation to distribute foreign produce. Even our railway companies are doing it. Abroad there are the most perfect marketing arrangements—grading, marketing facilities. I verily believe, after making some investigation, that if we had a good marketing system for agriculture, comparable with that of either France or Denmark or Holland, we should increase agricultural production by 60 or 70 per cent., and we should find a ready market at our own doors. Why are we ruling out all these questions? [HON MEMBERS "Who ruled them out?"] It is the only remedy which the right hon. Gentleman has suggested to-day for the condition of unemployment and trade depression in which we find ourselves.

Why do we not consider the whole of these problems? The right hon. Gentleman the Leader of the Opposition can put forward his proposals, and they would demand examination as coming from a great party in the State. [Interruption.] The right hon. Gentleman has already denied that. He has said that he never ruled it out. I never understood that it was ruled out. These are questions which ought to be examined. Take anti-dumping. I made a statement in the course of this Session in which I made it clear, though we are strong Free Traders, that if there were a clear case made out of dumping—we were talking about the dumping of oats and wheat—then, as far as we are concerned, we would co-operate in any project to prevent it.

Beyond that there is a real danger in the present condition of the world, a greater danger than ever, for the very reasons I have indicated—the enormous increase in machinery, the fact that we are producing infinitely more than we can consume. [Interruption.] A reference has been made to machinery that will produce as much hosiery as all the civilised members of the globe would require; and that is the case with all other industries—well, most industries. I do not want to get into a controversy with the hon. Gentleman. There is that danger, and there is the danger which has already been pointed out by the Commission on trade, that where one nation standing alone endeavours to reduce tariffs or to combat dumping, its effort has generally ended in an all round increase in duties. It is another matter—here I am quoting the opinion of a very distinguished economist who is a strong Free Trader—whether we should not concert, with the low tariff countries of the world, some method that would protect all those countries against what I call legitimate—or illegitimate—dumping.

The definition of dumping is a difficult matter, though everybody knows what it means. It is when a surplus of goods produced in a country at a certain cost is dumped upon another country at a price below the cost of production, advantage being taken of the fact that there is a high tariff in the exporting country. That is another matter that could very easily be examined, and then, above all—[Interruption.] How can you examine it if you refuse absolutely to go to any sort of conference at all? [Interruption.] The right hon. Gentleman says that we have all refused to look into these questions. I do not believe anybody has done it. Then there is the very great question of whether we cannot meet present conditions to a very large extent by utilising the present slackness in trade for the purpose of developing the national resources of the country, so as to make it ready for the time when prosperity returns. I earnestly trust the Government will not merely give due consideration to that policy, but will take Parliament into its confidence upon it. They have announced it in their election programme, and I hope they will undertake it boldly.

We are not going to combat these old doctrines about a general tariff or Safeguarding or Empire Free Trade even by powerful speeches like those delivered by the Chancellor of the Exchequer. We must show that a Free Trade country can adequately cope with tine situation by other methods. If we do not, this Parliament will be wrecked, not upon Empire Free Trade or Safeguarding, but upon the failure to carry out that enterprise to which the Government are committed. Again I say in all sincerity, if we wreck what might be a hopeful attempt, it will be no sort of consolation to find that amongst the wreckage the Chancellor of the Exchequer will be clinging like grim death to the Sinking Fund. Those are questions which could fruitfully engage attention. I agree with the right hon. Gentleman that before we throw over a fiscal system which has been rooted in this country for 80 years, we must be quite sure that we are not getting something worse. He has put four or five facts. I will just enumerate one or two. I was very much impressed with the test of the War. We were the only Free Trade country to engage in the War. It was a terrible strain upon the resources, the strength and the vitality of the nations. We are the only belligerent country in the world which went right through the War without a financial crash.


In spite of Free Trade.


The only one that went through without a financial crash! France has paid 5s. in the £ of her debts—[HON. MEMBERS: "4s."]—I beg pardon, 4s. in the £ of her debts—to her own nationals. Belgium has paid, I think, 3s. to 4s. Germany has paid nothing. It is true that our taxation is heavier, but our taxation is heavier than that of other countries because we are the only people who are paying our debts. If we paid only 4s. in the £ of our debts we could wipe out at once more than £200,000,000 of our liabilities—[Interruption]—wipe out taxation to the extent of £200,000,000 a year. In terms of Income. Tax, that is 3s. 4d. in the £. The right hon. Gentleman has pointed out That we are paying better wages than any country in Europe. There is a good deal said about wages in the United States. They pick the best of them! Has anybody read what is happening in the iron and steel industry in the United States—of the wages, the sweated conditions? They are working seven days a week at 10 hours a day and at wages—well, there is no blast furnacemen in this country who would take work under the conditions there. [An HON. MEMBER: "And child labour!"] Yes, and that is true. The whole story has not been told about wages in the United States. Besides, it is a sparsely populated country, with gigantic resources—[Interruption.] Yes, and then there are our social services to be taken into account.

Let me put another point. This is the country which maintains and employs more people to the square mile than any great country in the world—I said maintains and employs, leaving out all the unemployed. There are more men and women employed to the square mile in this country than in any great country in the world. [Interruption.] I said "great country"—like the United States or France. I am coming to Holland and Belgium. Taking England and Wales alone, there are more people employed to the square mile even than in Holland and Belgium. We have also the greatest international trade in the world, and that means that we have a greater seaport population here than in any country in the world. Does that seem a small thing? It is not merely shipping, but also the dock labourers living in seaport towns and other occupations of every sort and kind. Let me give one or two figures. In France you have one out of 24 of the population living in seaport towns. In Germany you have one out of 12, and in the United States of America the proportion is one out of six of the population. In this country the proportion is one out of three of the population living in seaport towns. What is the reason for that? [Interruption.] You cannot answer facts of that kind by a snigger. The real reason is that you have the greatest international trade in the world and that employs your shipping. Shipping has increased enormously in other countries during recent years, and that was due to the fact that after the War there was inadequate shipping for supplying food and raw materials from other countries.

The result has been that there has been a great promotion of shipbuilding, but, in spite of that fact, last year when trade was bad, 44 per cent. of the whole of the shipbuilding of the world was done in this country. The Leader of the Opposition made a speech some time ago in which he said that you must remember that when you have had a fiscal system in a country which has existed for a long time, trade, industry and commerce have adapted themselves to that particular system. That is perfectly true. There are many industries in this country, and shipping is very largely built upon the foundation of free imports. If you take that foundation away, a good deal of the trade will collapse. If that takes place, are you quite sure that you have other buildings equally commodious to which you can transfer your population? The Leader of the Opposition spoke of the greater security of Protection, but I will not argue that point. Greater unemployment is inevitable in a country with a great international trade, because when the international situation is disturbed you have such a shattering blow that you are bound to be hit, and the country which is most dependent on international trade is bound to be hit harder. Hon. Members above the Gangway say, "Let us have a trade that cannot be shattered like that." Are you sure before you swap that you are going to get something better than this system at its very worst? Take out, for example, all those who are unemployed, and you will find that there are more people employed per square mile in this country than in any other country in the world.

If you swap, what do you swap? You swap a country with higher wages, better conditions of labour, better social services, and a country that can pay its debts for a country where the hours of labour are worse and which paid a composition for its debts in the great War. Before we make a swap of that kind, let us consider the matter very carefully. I am not one of those who say that nothing ought to be done. I have suggested that something should be done, and I hope the Government are going to undertake it. Let us do something and try everything else before we indulge in the great gamble which has been suggested, because it is a terrific gamble, with the greatest trade in the world. Let us try everything else first, and do not let us deal with the situation as if it were merely a matter of continuing conflicts between one party or another, or quarrels inside parties, but rather as a question which involves national prosperity and the national existence.


We have listened to some doughty exchanges of debate, and we have listened to the classic presentation of the cases for Protection and Free Trade in terms which have been familiar to us for the last half century. The only thing we have not so far heard in this debate is a single vestige of constructive policy to lay before the coming Imperial Conference. That Conference is certainty the most momentous that has yet been held in this country, and may leave a permanent mark upon the history of our Commonwealth. In these circumstances, surely it is incumbent not only upon the Government but also upon a party which claims that it will shortly be responsible for the Government to tell us in detail and with precision the policy which they intend to lay before that Conference.

The Leader of the Opposition told us what he would do up to a certain point, but when he came to what he called primary products, namely, foodstuffs, he said that he had an open mind. The spokesman for the Government told us that on the crucial subject of bulk purchase of foodstuffs he also had an open mind. Perhaps it is a relief to some of us to know that the leaders of parties at least have an open mind in regard to the policy of their parties. I think the time has come when we should go beyond the open mind, and have a definite policy to lay before the country and the Conference. After all, minds can be open so widely as to suggest that they are vacant, and what this country and the Dominions want, is a hard, concrete policy which will meet some of the industrial and agricultural evils which afflict those countries.

The problems which we have now to face are fundamentally different from the problems before the War to which every argument used in this debate would have been much more relevant. What are the new factors which necessitate the devising of a new policy to meet the new situation? First of all, there is the phenomenal movement in world prices with its violent fluctuations which have dislocated agriculture and industry and has thrown out of gear the whole industrial machine. There is the development of the great producing organisations in other countries supported by capital advanced by their Governments which enables them to dump their products with devastating effect upon the markets of the world. There are the tariff barriers against which, so far, we have made very ineffective progress. There is also the growth of the mass production method in Eastern countries by ill-paid labour which threatens to undermine the whole standard of living. At, one time, when the skilled labourer of the West had to compete with the unskilled half-starved labourer of the Orient, his skill defeated ignorant and half-starved labour despite the disparity in wages. Now we have arrived at the period in which instead of the man working the machine, the machine works the man, and the unskilled labour of Oriental countries may, before very long, produce so cheaply that they will break the markets of the world. No man can study mass production in modern industry without coming to the conclusion that sooner or later cheap Oriental labour will by these methods very seriously threaten white labour. The rationalised industry of mass production is in many ways more suitable to Oriental than Western labour, and the new method may soon vitiate the old argument that skilled labour always beats unskilled, despite wage differences. Those new factors cut clean across the arguments to which we have been listening this afternoon, and -what is our constructive answer to that position?

What policy are we devising to deal with this situation? When I last addressed this House I suggested that we should strive to insulate these islands from the electric shocks of new world conditions by a system of import control board; that we should attempt by this means to build in this country a higher civilisation than that prevailing in the rest of the world which would absorb the production of modern industry. It would be a better policy with far greater prospects of success if you could extend your area of insulation to embrace the whole commonwealth of nations within whose borders can be found nearly every resource, human and material, which industry requires. I think that we can agree on both sides of the House that if we could establish and insulate such a commonwealth of nations, we could develop a higher standard of civilisation than that prevailing in the rest of the world, immune from the shocks and dislocation of these new factors which are bringing industry to a serious condition both here and in the Dominions. Then we should have an achievement in the pursuit of which we should find some measure of relief.

So far, only two policies have been suggested from any quarter to achieve that object. The first is the suggestion that we in this country should impose tariffs on foreign foodstuffs, in order to give the Dominions an advantage in our markets, in return for which we should ask for advantages in their markets. That is the policy, as I understand it, which the party opposite have some doubt whether or not to adopt. It is, at any rate, a policy which is clear-cut, which can be explained, and which can be defended. The policy which we on these benches have advocated is the policy of the bulk purchase of foodstuffs. It is that policy which, on numerous platforms, we have made the policy of the party on this side and which is in fact the official policy of the party. I remember, some six years ago, fighting the right hon. Gentleman, who will speak later for the Conservative party in this debate, in the Ladywood Division, when I made the bulk purchase of foodstuffs from the Dominions, and reciprocal advantages in their markets, one of the main planks of my platform. These two policies are the only policies which, so far, have been laid before the country to achieve this object, and I suggest that here and now is a very good opportunity to thrash out, so far as we can, their rival merits. Anyhow, more is to be gained by seeing whether or not we can devise a practical policy to lay before the Imperial Conference than by pursuing these barren controversies relevant to a situation which no longer exists.

The bulk purchase of foodstuffs policy has often been explained to this House by my hon. Friend the Member for East Leicester (Mr. Wise), and I hope that he will have more to say upon it in the course of this debate. I would remind the House that it envisages the bulk purchase, by steady contract for the most part, of foodstuffs from the Dominions, and the purchase also of foodstuffs at a guaranteed price from the farmers of this country. It is claimed that by that policy of bulk purchase very great economies will be effected in finance, insurance, storage and other factors, which will yield a very real saving. Those economies would be shared between producer and consumer. We hope, at the same time, to be able to give the Dominions the stable market which they require, and also, in the case of wheat, to maintain a price for bread as cheap as, or even cheaper than, that which we enjoy at present. That is a policy which has been worked out in some detail. It was not exactly my task, but I devoted a certain amount of attention to examining it when I was in office, and I believe that at any rate a strong prima facie case can be made out to show that that policy can be carried through, and that very great economies can be thereby effected, which will benefit alike the producer and the consumer.

The Chancellor of the Exchequer said that we must be very careful that, in any such policy, we did not place the British consumer at the mercy of the producer, to be exploited by him. How can the biggest buyer in the markets of the world be exploited by the producer, when the rival producers are engaged in a frantic search for markets? Britain, going on to the wheat markets of the world as the biggest buyer in the world, is, we are told, in danger of being exploited by Canada, who at this moment is desperately searching for markets for herself. Of course, the position of Britain, as the biggest single buyer in the markets of the world, would be overwhelmingly strong, and, so far from our being exploited by the producer, I think it would take the Dominion statesmen all their time to avoid being entirely at the mercy of so large a buyer.


Do I understand the hon. Gentleman to say that he would guarantee a price for wheat produced in this country higher than the world price?


I was just coming to that very point at that moment. So far, the policy of this party has envisaged merely guaranteeing to the British farmer, as I understand it, a stable price at the estimate of the world price. I myself would certainly suggest that it is not good eough, in the present agricultural depression, to say to the British farmer, "We will merely give you the world price." That is simply the stabilisation of depression. To have an effective policy for British agriculture, you must give to the British farmer a price at least 10s. a quarter above the world price now prevailing, and we simply delude ourselves if we do not accept that position. But here again is one of the main achievements which we may claim for the policy that I am advocating. A price of 10s. a quarter extra for the British farmer, even if it stimulated wheat production in this country until it rose to 20 per cent. of our total consumption, would, if spread over the whole field of our wheat consumption, mean an addition to present prices of 2s. a quarter, and that, I believe, is estimated to add rather less than ¼d. to the price of the loaf, while it is claimed that the economies which I have described and others which I will shortly describe, arising from bulk purchase, might result in a saving of something in the neighbourhood of 1d. on the price of the loaf. In fact, we should be able to give that higher price above the world price to the British farmer, and yet, by the economies we effect, to sell bread to the British consumer as cheaply as, or more cheaply than, it is sold now.

At any rate, these claims are advanced by people with very great knowledge of the subject, who can substantiate them in detailed argument, and I say that, if we are going into an Imperial Conference, a detailed consideration of all the great possibilities of this policy should be the very first thing to be undertaken. I am sorry that the Government spokesman said that only the Dominions put it down on the agenda for discussion. I would like to see the Government working out this policy in detail, and then putting it upon the agenda for discussion, and securing the advice and co-operation of the Dominions upon it.

The economies to which I have already referred as arising from this policy are by no means the only economies. It is far easier to secure the full rationalisation of the milling and baking trades in this country if they are dealing direct with a great centralised importing organisation of the kind that I have tried to describe, and the rationalisation of those trades should lead to considerable further economies. After all, the miller and the baker at the present time are primarily concerned, not with efficiency in their own production, but with speculation in the future movement of wheat; and, in the same way, the luckless British fanner is also primarily concerned, not with efficiency in production—it is not there that his profit rests—but with the movement of Wheat prices on the other side of the world. You have agriculturists in this country in the absurd and tragic position of having to pit their wits, not against Nature, the weather, and the other traditional handicaps of their trade, but against the machinations of some band of sharp speculators in the Wheat Pit of Chicago. Everybody engaged in these trades at the present time has this energies diverted from production to speculation. If he is successful in speculation, he makes a profit, but what chance has the farmer or the small man in any of these trades in a struggle against the manipulators of the great wheat rings? The policy of bulk purchase is, at any rate, a coherent and concrete policy to meet the situation which has been laid before the country in very definite terms, but it has never yet been the subject of any protracted examination or debate in this House, although it has often been raised in very forcible terms. I do hope that the Government will make it the subject of earnest inquiry at the Imperial Conference.

That, for better or worse, is one policy which could be laid before the Conference and could be examined. The other policy is the suggestion of hon. Members opposite, to tax foreign foodstuffs in order to give the Dominions an advantage in our markets, and to require from the Dominions a market for our exports in return. I am not going to enter into the discussion of tariffs as a matter of religion or dogma. I think I said, in the first speech that I ever made on tariffs, about 10 years ago in this House, that I was a pragmatist in these matters, and I am still. It is not a matter of metaphysics, but a matter of bread and butter. The question is whether or not, in given circumstances, it is wise to have a tariff, or whether it is wiser to employ some other method, such as the method which I have described, and which represents the policy by which I myself stand.

I would ask these questions of hon. Members opposite: Are tariffs, in fact, a practical weapon in the circumstances of the present time? How can tariffs meet the factor of fluctuation? During four months in the last year, wheat prices fell by 8s. 6d. a quarter. In the next six or seven weeks, they rose by over 13s. a quarter. In some weeks there was a drop of 6 per cent. in one week and a rise of? per cent. in another week. How can any tariff that the wit of man can devise meet a situation like that? I do not ask these questions in any controversial spirit, but I would really like to hear if there is an answer when hon. Members take part in the debate.

There is another factor, that of dumping—dumping on a huge scale, under the selling pressure from which great organisations are suffering. How can that be met by tariffs It might be met, as the right hon. Gentleman the Leader of the Liberal party seemed to suggest, by prohibition, but how can it be met by a tariff? You have an organisation like the American Farm Board, with a £100,000,000 credit behind it; you have an organisation like the Canadian Wheat Pool. Organisations in other countries are coming together in nearly every wheat-growing area of the world. Even in Central Europe, they are sinking their political difficulties in order to try to find a common wheat policy. How can tariffs meet the attack of one of these great organisations? If they are under pressure to sell, if they have to get rid of their wheat, after bumper harvests over a large area of the world, they will pactically give the wheat away, they will dump on your market over any tariff which anyone can erect to stop it.

On the other hand, the method of an Import Board very easily absorbs dumped wheat. The more the foreigner dumps, the better; it helps us to average out a cheap price to the British consumer. We should actually be supplying cheap bread to the British public at the expense of foreign organisations which were subsidising exports, to the extent that we liked to take it, and we would take it to any extent which did not dislocate our British agriculture and that of the Dominions. These are questions which have to be answered, and I cannot see what effective answer can be returned, at any rate, to the case that an Import Board provides an immensely superior method. Tariffs seem to me to be an ineffective and old-fashioned method of meeting the present situation. We put forward a system of organisation; hon. Members opposite put forward a system of haphazard taxation, which really seems to me to be a little too simple for the complex facts of the modern world. How can you organise a great economic unity in a commonwealth of nations just by banging on a tariff all round? It is not nearly so simple as that.

For instance, you cannot, when you have built your tariff wall round the Empire, as has already been admitted, ask the Dominions to close down industries which are already flourishing in their countries. That has been admitted by Empire Free Traders. But you can say to them, it you have a really systematic planning organisation, "We do not ask you to close down existing industries, but we will allocate and divide future production on sensible and businesslike lines between our various nations." You can say to them, "These industries are more suitable to be encouraged to develop in Britain; those, on the other hand, are more suitable for encouragement in the Dominions." All that, however, requires a systematic planning organisation of the type which is so well adduced it the report of the Committee of the Trades Union Congress. I cannot see that a mere haphazard application of tariffs can possibly achieve any purpose so large, so complex, and so difficult as the building of an economic unity of the type that we desire. It is very like the allocation of functions between the various departments of a business, and to have any such allocation of functions, or a successful business, it is necessary to have a planning and a systematic control which is prepared to use a variety of methods.

Hon. Members opposite may say, "All this is just Socialism—your planning, your control, your import board is all Socialism, and we will have none of it." What if it is Socialism? Many very useful things, from the pavements we walk on to the drainage system of our houses, are Socialism at present. In circumstances like these, surely the practical thing to do is to ask whether it is a right and wise thing to do in the given facts, not whether it means the application of some general principle in which we believe or disbelieve. Is the whole of this system and conception such an unreasonable thing to do in the given facts? The facts are that you have an absolute breakdown in the machinery of the grain trade, which with its little losses and profits, ironed out the fluctuations of prices before the War, but is now squeezed right out between the greet producers' organisations and the millers' trust. That industry, which performed a certain service in international trade, is now dislocated. Is not the reasonable thing to do in modern conditions to rationalise it, to put through a big merger, to unify a lot of smah businesses into one great highly organised centralised organisation? Is it not an eminently reasonable thing to do? It does not mean running the industry from Whitehall. Modern Socialist thought has gone a long way beyond that, for many years past. That is one of the many illusions about Socialism. But why could not that trade be run by the best brains in the trade, within statutory definitions of course, because it is a trade which will affect the life of everyone in the country. It is a great public utility concern, and you must have statutory definitions and some form of public control. But within those limits, why should it not, on defined and statutory lines, be conducted by the best brains in the dislocated trade in the form of a great merger or rationalised industry? That is what the proposal comes to when we examine it in detail.

But, whether or not we agree upon the method of achieving this objective, we can at any rate agree to some extent upon the objective, we can surely agree that a totally different set of facts has now arisen from those that prevailed before the War, that the mere hope of restoring our export trade to its pre-War position cannot solve unemployment, that we are subject to attacks and conditions, from dumping, fluctuations, slave labour or tariff walls against us, which did not prevail before the War and, if we can organise this great economic unity on rational lines, surely it is worth the attempt. It need not conflict by any means with the pursuit of international peace and the breaking down of international barriers. Why should it We can carry on that work just as vigorously as we have done before. But do not let us delude ourselves that, by international pacification and arrangement, any very speedy solution of our troubles can come about. After all statesmenship has concentrated on those efforts ever since the Genoa Conference with very many disappointments. For years past we have struggled to get the breaking down of tariff barriers against us, at any rate to get international regulations and conditions, which would remove the unfair odds against us, and so far we have not been very successful. Now the very people who led at Genoa, the banking community, in such efforts have turned apparently in despair from the hope of any very quick results on those lines. I, perhaps, have some doubt in swallowing whole the bankers' manifesto, because I have to remember that it is these people who have forced upon successive Governments the policy of acute deflation which is responsible for many, if not most, of our present evils.

I have sometimes heard of a physician counteracting one virulent poison by the application of another, and the bankers are striving, perhaps, to correct deflation by the application of tariffs, but we have some doubt in following the advice of a physician who has himself administered the original poison for the better promotion of business in the medical profession and, therefore, I do not attach that overwhelming weight to the bankers' manifesto that is attached to it in some quarters. But it is significant that, wherever we turn, from the last report of the economic committee of the Trade Union Congress to the bankers, we find a growing consensus of opinion that it is desirable, if it can be done, to insulate these islands, and this commonwealth, from the shocks of world conditions and, in the area under our own control, to build, while there is time, a high standard of civilisation which may absorb the production of our industrial machine. The alternative, after all, is to work internationally and to wait until the millennium dawns in the furthest corners of the earth, waiting for all mankind to be regenerated and to reach the standard of civilisation and excellence as we conceive it, waiting without any possibility of really controlling the situation ourselves until all these providential events occur in the very farthest corners of the earth. I would suggest that, while doing everything we can to bring order out of chaos in international affairs, we should, as a practical people, here and now organise, if we can, our own commonwealth as a great economic unit, and I hope this Government will devise a policy for that purpose and will enter that Conference with a policy and will emerge from the Conference with an organisation.


The hon. Baronet does not give any allegiance to the Motion that we have put down on the Order Paper in respect of the way in which economic unity can be attained. I, for one, though in complete agreement with my leader in the speech he has made, consider that, in certain respects, that Motion does not go far enough. It does not indicate completely those essential considerations which we have to bear in mind if this country is to face successfully the very severe crisis which now confronts it. To me, the most essential consideration is that the complete restoration of our country to economic health will not be found without some modification of what I call the monetary system. The last speaker indicated that it was fluctuations in the price of commodities which had so seriously affected, not only our own position but the position of all the commercial countries of the world. We have, since 1920, been passing through a period of depression. That depression in the last year has become noticeably acute. Since 1925, when we returned to the gold standard, the price of commodities has depreciated by something over 30 per cent. In those circumstances, financiers have become alarmed. They know that, not only the basic industries of the country but businesses in general are failing to show a profit. They know that they are getting into deeper and deeper water by the fact that credits that they have advanced are becoming more and more frozen, and they know from their returns that this country is faced with the very great difficulty of being unable, as it was able before the War, to create foreign balances abroad.

Financial circles, in my view, put down all these serious effects to one cause, the drop in the price of commodities. The bankers' manifesto seems to me to be a manifesto indicating a method whereby this symptom of falling prices may be cured. They suggest that we should put a tax, if necessary, on the whole of the raw materials and manufactured goods that we import and, undoubtedly, if they do that they will cause a cessation of the drop in prices. They will cure the symptom of falling prices as far as this country is concerned, but clearly the cure of that particular symptom would only be effected as far as the home trade is concerned. It will very likely result in the manufacturers who deal in these various raw materials, knowing that prices will no longer decline, feeling a revival of confidence in prices, and hence a revival of confidence in trade, and based on that we shall get an increase in prosperity. But even from the most optimistic point of view, it can only be felt that this growth of prosperity can apply to those industries in respect of which at least 50 per cent. of the production is for the home market. The suggestion that you are going to hold up the world fall in the price of commodities by means of tariffs may undoubtedly be a very good means of reviving the home markets for particular industries. When you come to some of our industries, for instance the cotton trade, where the amount of production for the home market is less than 25 per cent., it seems that this bankers' manifesto cure of the symptom of falling prices can hardly be expected to benefit that particular trade.

I should like the Rouse to appreciate that the symptom of falling prices is only one symptom of deflation. The cure suggested by the bankers' manifesto only suggests the cure of one of these symptoms. The other symptom which is a symptom of deflation is the fall in purchasing power, and, if we arrive at a condition in which we shall have arrested the drop in the price of commodities and we shall have done nothing to arrest the drop in purchasing power, it may very well be that our last state will be worse than our first. This deflation, on which I consider there is very little difference of opinion in the House, is the root cause of our problem, and the cause of deflation is that the basis of credit is gold. The gold standard, which, after all, is a method which worked successfully before the War, now only works with rumblings and difficulties and by causing great hardship to many millions of our people. If this gold standard system is to work successfully, it can only work under the conditions in which it worked before the War.

7.0 p.m.

There are two assumptions underlying the matter, namely, that the increase in the production of gold should keep pace pari passu with the increase in the production of commodities. The War taught us that by the use of methods of mass production it was possible to increase the production of commodities to an almost unlimited extent. There has been no similar increase in gold and no method whereby the precious metal can be won from the earth in larger quantities in the same way as commodities can be produced by mass production methods. Therefore, the first essential, the increased production of gold, no longer exists. A second essential is that you should have an equitable distribution of the world's supply of gold. This also does not obtain. Before the War this country could easily obtain larger quantities of the precious metal whenever it thought fit. Since the War America and France have had it in their power to attract gold, which, instead of using according to the gold standard system as a basis on which a credit could be built, they have sterilised. They are drawing it, but there is no need for it for the purpose of increasing credit. Even two days ago France was drawing from this country something over £1,000,000.

The gold standard, after all, is a game, but it is a game in which the conditions have been altered, in which the players now decide to adopt different rules from those originally proposed for the game. If the implements of the game are suddenly changed, then it seems to me we should seriously inquire whether we should not review the position as to whether we should play this game at all. In my view, the purpose for which gold should be used should be for the adjustment of international balances, and it should not be used as a basis of credit. In theory, all the credit of the nations using the gold standard should be convertible into gold. It is a theory which the slightest examination shows to be impracticable, because that amount of gold does not exist. There is no more reason why the total amount of credit should not be convertible into any other commodity, say, bacon and eggs. Should we not consider the suggestion made by my right hon. Friend the Member for Sparkbrook (Mr. Amery) in a debate in this House, namely, whether, side by side with this extension of Empire economic unity, we should not introduce a system of Empire currency, using the gold resources of the Empire, which are 70 per cent. of the world's production, as a basis and in that way obtain the very great and necessary economies in the use of gold which are causing such an amount of industrial unrest and hardship in the community to-day?

Empire economic unity seems to me to be vital. Few Members will disagree with the view that, if this country is to win through to success, it can only do so on the basis of Empire. But, vital and important as that subject is, it is bound up with this even greater world problem of the relation of the available amount of credit to a commodity which is being absorbed and isolated and not used in its proper form, the commodity of gold. I should regret if, in any consideration of this subject, this vital monetary problem, were ruled out.


I do not often trouble the House, and I hesitate very much to enter into this particular discussion. But, if I may say so respectfully, there is a point of view in connection with this problem which has not yet been mentioned and which is seldom put in this House, when questions of Protection and Free Trade are raised. I will endeavour to do so in a few sentences. I want, if I can, to put the case as the worker sees it. We have heard speeches this afternoon from leaders of industry, statesmen, and gentlemen who may be regarded as economists and who claim to understand this world wide issue very much better than I can hope to do. But it has occurred to me, in listening to some of the statements made, that appeals on Empire Free Trade and on Empire Economic Unity are always directed in order to secure the support of the working classes of this country who are, I am sure, interested in any new proposal that will increase trade, bring about prosperity and lessen our unemployment.

I am very much interested in the proposals put forth by the hon. Gentleman the Member for Smethwick (Sir O. Mosley), but I would like to offer a few words of criticism on the one relating to import control boards. I know little about the production of wheat, but I am familiar with what is happening in the flour milling industry of this country. In passing, I would say that the Co-operative Wholesale Society, so I understand, purchases 12½ per cent. of all the wheat brought into this country, and it has, in fact, a miniature form of import control board already established. When the hon. Gentleman spoke about rationalisation in the milling industry, it is worth while noting that that industry regards itself as already highly rationalised. It is stated, for instance, that 50 years ago there were 10,000 master millers in Great Britain and that to-day they number only 600. Consequent upon this rationalisation which has already taken place in the industry, there are large numbers of operative millers who are now receiving by way of gifts small sums of money to maintain them, because they have been thrown out of work.

The workman is naturally puzzled as to the effect on him and his family of all these proposals that are made by gentlemen in very high positions who have never worked in factories or coal mines in their lives. I have taken some interest in the discussion that is going on all over the country consequent upon the proposals made by Lord Beaverbrook. If Members will read the book he has recently published, they will find that his main appeal is to the British workman. He makes one extraordinary statement that I would like to see examined very closely. He states that real wages are twice as high in the United States as in Great Britain. That is certainly not the case. I get information once a month about the mining industry of America, and I am assured, that poor as are the wages and conditions in the coalfields of this country, they are no better in the United States at the moment. Wages are terribly low there and conditions very bad, and unfortunately the miners in that country are not so well organised as they might be. To argue therefore that the real wages of the working classes in the States are twice what they are here is deluding our working people.

There is, as I have stated, a Labour standpoint to be put forward in regard to this question of Empire Free Trade. One argument always employed against Free Trade is that it is an ancient policy, that it is about 80 years old, and that the conditions of a century ago do not apply in this country to-day. If there was one reason more than any other that caused the last war, it was the desire of the industrial countries of Europe to capture and dominate the markets of the world. It seems to me that tariffs are the very beginning and initiators of jealousies between nations that ultimately bring them into armed conflict.

When I hear Members, on both sides of the House, speaking in favour either of Empire Free Trade or making the British Commonwealth of Nations into an economic unit, I wonder what they must be thinking about new alliances and balances of power that must result. There are at least two points that should be made clear. When it is suggested that the British Commonwealth of Nations might be built into an economic unit, what does that mean? Are they proposing to invite the manufacturers of Australia and of this country to agree among themselves as to which is the best part of the Empire to establish their factories and workshops? What employer or factory owner in the whole of this vast Empire would be willing to transfer his plant to any other part of it for Imperial reasons? Would the Imperial Chemical Industries, Limited, for instance, transfer its plant for the purposes of the Economic Unity of the Empire? Of course not! I am sure that they would never dream of doing it. They will erect their buildings just where it pays them best by way of making profits. If they can make 10 per cent. more profit in London, they will erect their buildings and plant in London, and will not, merely for the sake of Empire unity, transfer them to Canada or anywhere else. Consequently, in my view, that argument falls to the ground.

The argument is used that we ought to raise the standard of life within this British commonwealth of nations, and develop it to such an extent as to put us in the forefront in regard to the raising of the standard of life in general. That idea is a very commendable one, and I agree with it entirely. From my study of the conditions in the whole of Europe, I find that the best are to be found in this country for almost all purposes, practically speaking. I often wonder, when people talk of the British Empire as a commonwealth of nations, whether they have looked into the racial question. Have they compared the British Empire with the United States of America? It is a very interesting study. The United States has a population of about 120,000,000, of whom 105,000,000 are white people with a standard of life, if anything, higher than we possess. When you come to the British Empire with a population of about 400,000,000, there are, I think, only about 65,000,000 white people, all told. Consequently, the comparison of the two communities—the United States of America and ourselves—in regard to the standard of life will not hold good at all.

I feel sure that the working people of this country and of every country in the world have come to the conclusion, both in respect of Free Trade and of Tariffs, that it does not matter much whether they are employed in a mill in Germany, in America, or in Great Britain, or in Belgium. They suffer low wages in a Free Trade country and are confronted with unemployment in a Tariff country and vice versa. In fact, there are causes affecting unemployment which have not the remotest relation to the fiscal policy of any country. Rationalisation and world causes are mentioned, electric power from water supply, and all the rest of it; and it is said that unemployment has almost exclusively been caused by these factors.

There are certain human factors in Great Britain to-day which cause unemployment here and which hardly anybody has ever thought about. I am not going to argue the rights or wrongs of the presence of women in industry; but, if hon. Gentlemen would study the figures, they would find that if the same proportion of men and women had remained in industry in Great Britain from 1910 to 1930 there would be half a million more men at work and half a million more women at home. That is a vital factor in the problem of employment and unemployment. Let me repeat that I am not arguing the rights or wrongs of women in industry. But this is a fact which has no connection at all with any fiscal policy of any kind.

I will mention another factor. Hon. Members may take this as a rather humorous point, but really these vital statistics, which I regard as human factors, are upsetting all the calculations of statesmen, economists, industrialists, and politicians throughout the world. If the average life of the individual in this country had remained the same from 1900 to 1930, there would probably have been no unemployment in this country, all other conditions being equal. These two factors point, therefore, to one thing. The argument about Free Trade and Tariffs, and that unemployment is caused because we require a new fiscal system or Empire Free Trade, falls to the ground when such human factors confront us at home and which are beyond the contemplation and beyond the control of any Government whatever.

I will conclude by adding my protest against the idea which prevails that the Labour party is not a Free Trade party. The Labour party has definitely and deliberately decided at conference after conference in favour of Free Trade. I believe in Free Trade myself, in spite of all the arguments which have been put against it to-day from several sides of the House. When some hon. Members talk about turning this great British Commonwealth into one economic unit and propound the idea of Empire Socialism within that unit, I am inclined to fear an Imperialistic idea behind the whole scheme. Although I am a Socialist, I am not an Imperialistic Socialist. I do net believe that Imperialism, has helped the human race in any part of the world. If this or any other Government accepted the policy of transforming this great Empire into one great economic unit, or if the other side of this House succeeded in adopting Empire Free Trade, the ultimate result, in my view, would be that other Governments and other nations would endeavour to build up Imperial States in order to retaliate. You would have a new balance of power in the world, and, instead of achieving the object which we have in view, I feel sure that the world would have to face an even greater catastrophe than that which came upon us in 1914. If one nation can produce a commodity better than any other, that commodity ought to be sold in the whole of the markets of the world. If the Lancashire textile trade can produce the best textile goods—as I think it can—no country ought to put a tariff against those goods.


Go and tell them that.


I will tell them that in the hon. Member's constituency, if he desires. If the Germans can produce the best pianos in the world, the musicians of the world should be entitled to get those pianos; and, incidentally, if the Welsh people can sing the best songs in the world, their songs ought to be heard throughout the universe.

I feel satisfied that the working people of Great Britain will not be brought to believe for a single moment in this Empire Free Trade stunt, which is merely another title for Empire Protection. There never was a more silly misuse of words than calling the policy propounded by Lord Beaverbrook Free Trade. It is sheer Protection. It is like building a wall round this great British Empire and then saying to everybody outside, "If you dare throw any goods over the wail which we have built around this Empire, you beware of our guns." That is what it must mean in the end. I oppose this idea of Protection and tariffs, not merely on national economic grounds, but because tariffs never in themselves bring good wages or good conditions to the workpeople. As far as I have been able to read the history of this and other countries, tariffs are more responsible for national hatred, for jealousy, and wars than any other causes known to mankind.


The hon. Gentleman the Member for Westhoughton (Mr. Rhys Davies) claims that the party of which he is a member is a Free Trade party. I should like to know upon what authority he makes that statement, especially in view of the recent resolutions passed by the Trade Union Congress, and still more in view of the fact that we have listened this afternoon to a speech from the hon. Baronet the Member for Smethwick (Sir O. Mosley), which was, in essence, a fighting Protectionist, speech, and quite clearly commanded the assent and approval of a majority of the back benches on the opposite side of the House.


If the hon. Member will read the resolutions of the annual conferences of the Labour party he will find that the Labour party is a Free Trade party irrespective of individual opinions expressed by members of the party.


In reply to that, I would ask the hon. Member what happens when the individual opinions expressed outnumber those which are expressed at the conference? The hon. Member will not deny that there is a great and formidable volume of Protectionist opinion in the party opposite which is becoming stronger every day. I do not think that you could possibly have heard a clearer or more cogent or more lucid advocacy of the whole Protectionist thesis than that which we heard this afternoon from the hon. Baronet the Member for Smethwick. I have never heard the case for Protection more clearly or concisely put. Frankly, for my part, I should not have thought it worth while to intervene in the debate at all had it not been for that speech, for up to that point, and particularly regarding the two speeches which preceded that of the hon. Baronet, it was like listening to voices from another world altogether, from a period which came to an end, thank God, about 1845 or 1850. At least the hon. Baronet the Member for Smethwick, although I did not agree with everything he said, addressed himself to some of the problems of the Twentieth Century and to the Motion on the Paper this afternoon.

The right, hon. Gentleman the Leader of the Liberal party contented himself with making as much purely party political mischief as was possible within a comparatively short space of time. He thought that the debate provided a suitable opportunity for making a little cheap party capital and for trying to foment discord among the various political parties in this country just prior to one of the most important Imperial Conferences which has ever been held. I do not know how helpful he thought all that was going to be. The speech of the right hon. Gentleman the Chancellor of the Exchequer gave one reason for even greater despair. It was a characteristic performance, absolutely bad, absolutely destructive from every point of view. The sole contribution which the Chancellor of the Exchequer, after over a year of office, has made towards the solution of any of our economic problems can be summed up in the one word "doles." All he has been able to think of is doles, and more taxes in order to pay for them; shovelling out money to people who are unemployed, and who are likely to remain unemployed as long as the present Chancellor of the Exchequer remains in office. More money, more doles, more taxation, and that is the end of his policy. I detected on the other side of the House a growing impatience with the policy of absolute sterility and negation which has characterised the administration of the right hon. Gentleman ever since he took office at the Treasury. The whole country, as the right hon. Gentleman the Leader of the Liberal party recently said, is now crying out for something to be done, and it knows very well that as long as the present Chancellor of the Exchequer remains in office nothing will ever be done in any direction if he can possibly help it. As I have said, it was like listening to voices from another century altogether, and it was very depressing.

It is not so very difficult to perceive the main causes of the unprecedented depression which we are undergoing in this country at the present time. I am certain that hon. Members on all sides of the House, and even the present Chancellor of the Exchequer, would agree that the fundamental cause of the prevailing depression in this country is the fall in commodity prices which has gone on steadily for the past four or five years. How can you expect any producer, agricultural or industrial, to make a profit when he is confronted by a steady fall in commodity prices in the markets of the world? It is absolutely impossible. Every time he produces higher costs outrun the prices he realises for what he produces. Therefore, so long as these conditions continue there is bound to be great industrial depression. The second cause is the failure of costs and of retail prices to conform to that fall in commodity prices; and the third cause is the lack of markets. We can summarise under those three heads the whole of the reasons for our present industrial troubles and for the increasing volume of unemployment.

We on these benches suggest three main remedies. Firstly, we suggest the protection of the home market; secondly, the economic development and organisation of the Empire; and, thirdly, the stabilisation of prices. With regard to the question of Protection, the hon. Member for Smethwick was right when he pointed out that conditions have entirely changed compared with what they were in pre-War times. I would ask the hon. Member for Westhoughton, who says that any nation that can produce goods more cheaply than another nation ought to have free access for those goods in all the markets of the world, what he proposes to do during the remainder of the Twentieth Century under the prevailing conditions of mass production. Suppose that we get in India and China and other parts of the East vast mass production factories, working with Oriental labour, and under what he would describe rightly as sweated wages and sweated conditions. Does he really think that we should leave our markets naked and defenceless against that sort of competition?


The hon. Member does not want to misrepresent me. I did not say that the cheapest goods should be sent all over the world. What I said was that the best goods should be sold throughout the world.


I believe that the best goods ought to be sold, and that the country that can make the best goods ought to be in a position to compete upon fair terms with other countries for the markets of the world, but the hon. Member will admit that frequently it is not a question of the best goods—because many classes of Wholesale goods do not vary so much in quality—it is the goods that can be produced under the cheapest conditions that get the market. Whether we like it or not, we are going to see goods produced in vast quantities by mass production, by Oriental labour, and under wage conditions against which we can never hope to compete. I want to know what hon. Members opposite propose to do about that, in order to protect the standard of life and wages in this country. I was not surprised to see the resolution that was passed recently by the Trades Union Congress. Over 90 per cent. of the manufactured goods that we import into this country come from foreign countries. Not only that; although the surplus investing power of this country is much reduced, the money market of London is still open to foreign capitalists, who can borrow therein as freely as they like. What do they do with the purchasing power that they acquire from these two sources? They use it to buy manufactured goods from our principal competitors, and then they proceed to dump their surplus produce, without let or hindrance, upon the people of these islands. This condition of affairs cannot go on very much longer; if they do we shall pay for it very dearly.

I come now to the question of Empire Free Trade, or Imperial organisation, as it may be called. I think that far the most hopeful line in this direction can be summed up in the more or less comprehensive term of Imperial rationalisation. In the British Empire we have what might be made the largest and most powerful self-contained economic unit in the world. It is no good the hon. Member for Westhoughton saying that we ought not to have these large economic units. Under modern conditions of mass production we are bound to have these huge economic units. There are two large economic units in the world to-day—the United States of America on the one side, and Europe on the other—hoth surrounded by high Protective tariffs. Russia is likely to become a third economic unit. In isolation against these great economic units, working under mass production conditions, we must succumb. But unless we are armed with the Protection which is necessary, we cannot seek admission either into the Empire organisation or into the European organisation.

We claim from this side of the House that far the most hopeful and fruitful line of advance lies in the development of a new and potentially richer and more powerful economic unit than exists anywhere else in the world—the British Imperial Economic unit of the British Commonwealth of nations, self-contained and self-supporting. That can only be done by means of reciprocal arrangements involving most delicate economic negotiations, in order that we shall have the nations within the British Commonwealth of nations which are capable of producing the best of any particular article concentrating upon that article, and exchanging it for articles produced by the other members of the Imperial Economic unit. That is the main objective, or should be the main objective, of the forthcoming Imperial Conference.

The crucial point arises as to how we on our side are to implement any bargains that we may make. Here, I would advance a plea for what the hon. Member for Smethwick has described as the pragmatic view. When the debate earlier to-day took on a purely party political aspect, it became absolutely sickening, in view of the vital issues at stake. I say, in response to the plea put forward by the hon. Member for Smethwick, that if we on this side would go into this Conference with absolutely free, unprejudiced and unbiased minds so far as import boards are concerned, he and his friends ought to go in with unbiased minds so far as tariffs are concerned. I am not sure that it is not by a combination of these two principles that the greatest degree of Imperial and economic organisation and development can be achieved. So far as the import control boards are concerned, on superficial examination, there is a tremendous lot to be said for them. We are confronted with huge organisations of producers overseas, in Canada and Australia and elsewhere with export control boards on every hand, and there is certainly a case for setting up an import control board to counterbalance them in this country. But let us face the dangers of this proposal frankly. Once you start controlling and purchasing the imports through a statutory import control board, you may be compelled gradually to extend that control so that ultimately it covers the whole of the distribution in this country as well. That would be too formidable and difficult a responsibility, especially where such vital articles are concerned, for any Government to assume. That is the chief danger. However, this question and kindred questions ought to be examined at the forthcoming Imperial Conference absolutely on their merits. Nothing should be excluded, whether import control boards, tariffs or anything else.

When the hon. Member for Smethwick was talking about import control boards, some of the more elderly Members on the Front Government Bench were indulging in cynical and contemptuous smiles, as if it was all so much nonsense. The Secretary of State for the Dominions adopted a particularly superior attitude in that connection. Although those right hon. Gentleman may not believe in it, although they may have thrown over the whole of this policy, as they appear clearly to have done, it was, as the hon. Member for Smethwick pointed out, part of the official policy of the Labour party at the last General Election. I know that in my constituency a very large number of votes in the country districts were won against me simply and solely on account of this particular policy, because many farmers and many agricultural workers saw in it a form of Protection, or what might be developed into a form of Protection. On practically every Labour platform the policy of import control boards was advocated at the last Election, and it ill becomes the Secretary of State for the Dominions and the Chancellor of the Exchequer, now that they have got into office, to sneer at the very mention of the words "import control" in this House, and to abandon the whole policy. It ought to be considered upon its merits, just as I say that the question of reciprocal tariffs and agreements of all kinds ought to be considered.

I come to my final point, which is fundamental, and that is the question of the continuous fall in the wholesale level of commodity prices. Until we can tackle this problem it is no good talking about tariffs, import control boards or anything else. When you have so startling a fall in commodity prices as has taken place, a tariff of 75 per cent. on imported goods will not solve your problem and will not materially alter the situation. We must stabilise commodity prices before anything else can be of any good. What is the main cause of the trouble? I do not know whether hon. Members have read recently a most interesting and informative memorandum by Sir Henry Strakosch. It deserves the closest attention of hon. Members in all quarters of the House. We hear it said—I heard it from the Chancellor of the Exchequer and the leader of the Liberal party to-day—that it is over-production that is the cause of the trouble. I believe that statement to be absolute nonsense. We have in the world great and increasing production; but all over the world we have also vast numbers of human beings who are living in the greatest want, poverty and distress, who are only too anxious to get the things that are produced and to use them, and who would thankfully purchase them if the machinery was put in their hands to enable them to do so. It is not a question of over-production. If it were so, it would be a final argument in favour of Protection. Therefore I was amazed to hear that statement come from the leader of the Liberal party. This is what Sir Henry Strakosch says: A symmetrical increase in production of goods raises the standard of living, and no disturbance need arise provided there are available means of exchange in the form of money to an amount that corresponds to the increased volume of exchanges that this greater production necessitates. And again: There is a superabundance in nearly three-quarters of the various kinds of raw materials the world needs currently; there is an anxiety of the producers of each of these products to exchange them for others: yet they are not exchanged. Why? The answer is simple—because there is not a sufficient amount of money available in the world at the present time in order that those goods may be exchanged. Statistics show that the average increase in world production per annum is 3 per cent. For the last three or four years the average increased amount of gold available for monetary purposes has not been more than 1½ to 1¾ per cent. Here are to be found the main causes of the trouble—the maldistribution of gold; the sterilisation of large quantities of gold, which could be and should be used for monetary purposes, in America and France; and, finally, because of the scramble for gold between the central banks of the world, which has led to appreciation of the value of gold in terms of commodities and has therefore brought about the disastrous fall in commodity prices.

This problem is absolutely fundamental, and I plead that the forthcoming Imperial Conference should review the working of the gold standard in relation to the economic problems and difficulties of the Empire as a whole. It ought never to be forgotten that we produce about 70 per cent. of the total output of gold in the world. Why should we not pool our gold resources, and devise a scheme—it would take me at least halt an hour to outline such a scheme—that would keep commodity prices within the Empire stable, and free us from the dependence upon New York, and upon the foreign financial centres in Europe, which is at the present time strangling us, and is more responsible for our industrial depression and unemployment than anything else. It seems to me to be a question that deserves more urgent consideration from the Government than anything else.

In conclusion, I should like to quote some observations which I read in last Sunday's "Observer" by Mr. Garvin, and which are absolutely true at the present time: We are pretty sure that all of them would tell the Prime Minister one thing—that Britain since the War, by comparison with other great civilised communities, has been more of a 'No-no Nation'—more hag-ridden by orthodox objections and less fertile in original performance—than at any time in our annals. We doubt whether Mr. Ramsay MacDonald would dissent from that general statement serious though it is. The talk about further and further inquiry is nothing but an excuse for irresolution and evasion. There is a superabundance of evidence and suggestion before the Labour Government. What Ministers have to do is to make up their minds in no ordinary sense. What the country needs is the full spirit of economic action and organisation one way or another. We plead for one way, but some of us would rather see it done the other way than not done at all. The most depressing thing about the Imperial Conference is that the men who are to represent this country do not represent in mind or spirit or ideas the youth of this country from any point of view, and they are going to this Conference sterile and bankrupt of any ideas of value. They have turned down every constructive proposal that has been made during the last 14 months, and, unless they are changed, I am afraid that nothing good can result from the Conference.


The debate so far has shown a remarkable divergence of opinion among hon. Members in the House. I cannot agree with my hon. Friend the Member for Westhoughton (Mr. Rhys Davies), and I am rather surprised to hear a representative of a Lancashire constituency say that he still an out-and-out Free Trader. If he was appealing to his constituents on the cry of tariffs and Protection and no taxes on food, he might perhaps get away with it, but what would happen if he seriously examined the question of the export of cotton machinery to India, with the capacity of the Indian to turn out the same amount of cotton goods near to the source of the raw material and nearest to the most lucrative market in the world? With everything in his favour, except the skill of the operatives of Lancashire, low wages, longer hours of work and proximity to the market, I imagine that his own people in Lancashire would probably want a further explanation of the effects of our present Free Trade policy. I make no apology for saying that I am a Protectionist, although I do not believe in tariffs. At the same time, I realise hon. Members opposite think tariffs would be better than the scheme outlined by the hon. Member for Smethwick (Sir O. Mosley), and which I suppose will be outlined again later by the hon. Member for East Leicester (Mr. Wise).

I object to tariffs because they always operate in a direction opposite to that in which they are intended. Take the imposition of what is opposite to a tariff; take a subsidy, the subsidy on coal. We subsidised our coal in order to capture the European markets. I was in the Ruhr at the time and there were about 15,000,000 tons of coal on the Westphalian coalfields running to waste, rotting and depreciating in value. In the following year, soon after the beginning of the general strike, there was no coal rotting there, they got rid of it. Whilst we were subsidising our coal the German syndicate said to the German coal workers, "British coal is being subsidised and sent into your markets at 4s. per ton less than the cost of production here: you must accept longer hours or less wages." After a long and disastrous strike and after taking off the subsidy we retaliated by raising the hours of labour of our own coal workers. The immediate effect of that was to increase the hours of work over the whole of the German coal mines. They were prepared to meet our competition with the same weapons; and the final result is that the conditions of labour in the mines have gone down. I am quite unconvinced that tariffs have any other effect. Suppose you put a tariff of 30 per cent. on certain manufactured goods coming from Poland or Czecho-Slovakia, the employers in this country say to their work-people that they must either produce more or accept lower wages; at any rate the cost of production must come down in order to retain our markets. The effect of putting on a tariff against manufactured goods is to lower the level of wages and conditions in competitive countries and incidentally that would react unfavourably upon the conditions of work in this country.

If you are going to adopt any policy of Protection you should be perfect and absolute in the matter. If you want to protect industry protect it on an ethical principle, not on a tariff. Protect industry on the ground that some other group of workmen are accepting worse conditions of life than your own work-people. That is a perfectly logical principle, and a thoroughly defensible principle. I know the objection to that is that if we were to adopt such a principle we should have to shut out nine-tenths of the goods from overseas. At any rate, it is our business to see how far we can adopt the principle of absolute prohibition of goods made under unfair conditions in other countries. With regard to the interesting point made by the hon. Member for Stockport (Mr. Hammersley) and the hon. Member for East Aberdeen (Mr. Boothby) with regard to the fall in commodity prices, I think we all agree that the fall during the last five or six years has been disastrous, and it must be evident to every hon. Member that it has probably hit the British Empire more severely because it is largely an agricultural community. Of the 450,000,000 of people, about 400,000,000 are agriculturists, and it is obvious that the fall in commodity prices has hit the agricultural community in this country and throughout the Empire.

This fall has worked in a rather curious way. The drop in the level of commodity prices has been from 16 to 17 per cent. from 1925 to 1929, which roughly represents £1,300,000,000 appreciation on our National Debt. Compare that with the amount we have paid off during that period, about £200,000,000 or £250,000,000; and the appreciation on the load of Debt is something to which I hope the Chancellor of the Exchequer will one day give his most serious attention. I should like to have some explanation of a phenomenon of that kind. Why does this clutching at the Sinking Fund as the last straw in orthodox finance have the effect of increasing the burden of debt by between six or seven times the amount by which the Debt is technically reduced? The fall in the general level of prices must inevitably be a grevious burden upon every class of the community and particularly on the agricultural community, in this country as well as in every other part of the world. They cannot regulate their production in the same way as manufacturers. The agriculturist is absolutely dependent on his crop for his livelihood. He has to grow them year after year, and to accept the prices which he can get. They are the people who are hardest hit in any general fall in commodity prices because they have no means of reserving their products in the same way as the manufacturing community.

As a result of this debate I hope that the right hon. Member for Bewdley (Mr. S. Baldwin) will reconsider his decision as to entering the three-party conference in an attempt to solve the present problem of unemployment, which affects not only this country but every great manufacturing country in the world. If he is at all sympathetic to the changing ideas in his own party, if he has his ear attuned to the murmurings among Members of other parties with regard to the present situation, if he is convinced that the time is right for a national conference on a matter of Imperial needs, the country would welcome what would be a generous admission of error on his part and we should not hear quite so much about the possible effects of tariffs upon the life and fate of this country.

8.0 p.m.


I listened very carefully to the speech of the Leader of the Opposition in order to see what kind of a policy the right hon. Gentleman would pursue if he were Prime Minister and had to deal with the problem of agriculture in this conference. As far as I could gather the right hon. Gentleman very carefully avoided most of the questions which are referred to in the Vote of Censure, and, by the way in which he treated the Motion it seemed to me that he was of the opinion that it was out of order. Underlying this Vote of Censure is the question of unemployment, and how it is going to affect agriculture and the Empire. In a speech which he made a short time ago dealing with agricultural problems the right hon. Gentleman said that, as far as he was concerned, he would be prepared to apply the revenue of Safeguarding to giving a guaranteed price for wheat in this country. He has not stated that in the House of Commons this afternoon. We do know what some of the hon. Members on the Government side of the House mean when they talk about the bulk purchase of wheat and the institution of an import board, but, as far as I can understand, after having listened very carefully to the speech of the right hon. Member for Bewdley, who after all has had an opportunity to deal with this problem, he did not state at all how he was going to tackle the problem. Therefore, it is little wonder that not only the agricultural interests in this country, but the right hon. Gentleman's own friends, the Tory farmers, are in a fog as to what the right hon. Gentleman would do if he had an opportunity to deal with the problem.

After having given some thought to the policy which has been put forward by Lord Beaverbrook, it seems to me that if the right hon. Gentleman were completely to capitulate to the Empire Free Traders and take his party with him, there would arise in this country, at least among British farmers and those who are dependent upon agriculture, something in the nature of a new terror in the form of imported Dominion corn, and, very largely, if we are to believe current reports, Dominion corn subsidised by the Dominion Governments. I am one of those who hope that the present Government will go carefully into all these problems before they face up to the policy which is to be considered at the Imperial Conference. For the life of me I cannot see why, if the leader of the Opposition is a believer in the policy which he has expounded, he could not have put something of that nature on the Statute Book when he had a majority of 211 in this House and was in office for nearly five years.

I doubt whether there is a majority in this House, and I doubt whether there will be a majority in any succeeding Parliament, for the bulk purchase of imports, but I do suggest that instead of the policy which has been enunciated by the right hon. Member for Bewdley (Mr. S. Baldwin), namely, the application of the revenue of Safeguarding to a guaranteed price for wheat, being considered, the Government should consider that for which I believe there is a majority in the House, namely, a quota system or a compulsory milling percentage of home-grown wheat in the loaf in this country. Without talking of what is to happen in future Parliaments and without considering whether the right hon. Member for Bewdley will ever manage to get another majority, I believe there is a majority in this Parliament for such a step.

The agricultural industry is not concerned with what is going to happen to the Dominion importers of corn. It is concerned that the Government should tackle the problem of agriculture and try to establish something like organisation in the industry. If at the coming Imperial Conference any arrangements are to be made for rationalisation in the Empire, it is far better that any recommendations or ideas of that kind should come from the British Government. As one who has had considerable experience, having lived in the Empire and visited most parts of it, I say that our friends above the Gangway are undoubtedly suspect, not only of tariff-mongering, but of using the cry of "Home and Empire" as something in the nature of party property. If you make some kind of fiscal arrangement a definite plank in a political platform you will soon hear low rumblings from the Dominions as to their opinion of the procedure. The Empire will never flourish behind a system of tariff walls.

I hope that the Secretary of State for the Dominions will bear in mind the needs of agriculture in this country, and the fact that farmers, particularly arable farmers, have been looking to the Government for 12 months to do something in the matter; that he will bear in mind the fact that real service to the Empire can come only by arrangements which will produce a natural and unfettered co-operation. We can go on in debate after debate hearing the kind of speech that has been made by the right hon. Member for Bewdley to-day and still get no nearer a solution of these problems. I do hope that the present Government will not pay any attention to the Protectionist campaign which is being carried on by the Conservative party. I hope they will recognise that there is a real opportunity to deal with this problem to-day, that there is a majority in this House to deal with it; and I trust that the Cabinet at an early date will make an announcement that they really intend to tackle the problem.

Lieut.-Colonel GAULT

Although in the past few years we have had many opportunities of listening to debates on subjects of first-class importance, I think that the subject embraced in the Vote of Censure to-day is one that is second to none, for upon the country's decision in this matter, in my opinion, rests not only the future welfare of England, but the future destiny of our Empire. I have no intention of doing more than touching briefly on the past, but I would like to remind the House that prior to the last General Election, thanks largely to the sound, common-sense policy of the Government then in power, industry had been improved and unemployment steadily reduced, and that, notwithstanding the egregious mistake of the General Strike, from which the country has not yet recovered—a mistake which completely dislocated trade and industry and had the immediate effect of increasing the unemployed by upwards of 600,000 persons—the unemployment of a year ago, when the present Government came into power, was only some 1,130,000 compared with the total of nearly 2,000,000 to-day.

At the last General Election the three political parties came forward with their respective proposals; the Conservative party with a fine record of legislative achievement behind it, and with its tried and proved policy for the continued restoration of trade and industry, which was already slowly but surely reducing unemployment; the Liberal party with a scheme of borrowed millions for investment in what, I fear, would have proved largely unproductive roads, a scheme which, to follow the simile indulged in by the right hon. Gentleman who leads the little group of Liberal diehards or will-of-the-wisps below the Gangway, places his party after the mansions of the Socialists and the flats of the Conservatives in the crazy upper tenements of prehistoric political thought; and lastly the Socialists, with their specious promises of a new heaven and a new earth, which have proved dismal and dreary failures to all who may have been misled by them.

It is not with the past but rather with the future, that I am concerned; not with the mistakes of yesterday but with the construction of to-day and to-morrow that I want to deal. It is not sufficient to chide the Government on its incompetence; on being bereft of idea and barren of accomplishment, to remind its members of the hopeless pass to which the country has been brought under its administration. I, for one, do not particularly wish to score debating points at its expense, but I do want, if I can, to add my voice to those other voices that are endeavouring to arouse our people to their danger, and to point out and emphasise those measures and principles by which many of us think that our grave problems may be solved. I believe, and believe intensely, that the permanent solution lies under three headings—headings that are writ large upon the wall for all who have eyes to see.

The first is the necessity for rigid economy in national as well as individual finance. The second is the clarion call of "British goods for British people," together with a policy which will ensure the home market to the home producer, for, unless we support our own industries we shall lose the very source of wealth which provides the nation with its purchasing power in the form of wages, salaries and dividends. The third and most important of all, in ray opinion, is the desirability, nay, the need, of the welding together of the component parts of the British Empire, holding as they do a quarter of the world population and a quarter of its wealth, into an economic unit for the common good. Last autumn I happened to visit several European States that had been dismembered as the result of the War, and from three different people in three different countries heard exactly the same story—the story that told of their economic poverty and the necessity to find a wider economic unit for their national good. It seemed to me, as I listened to these stories, that the remedy suggested as the solution of their difficulties was exactly the remedy which we required for ours—a wider economic unit, which we at least have for development at our very door; the wider economic unit of Empire carved out for us by the courage and faith of our forefathers and only requiring the same faith and courage to-day for its fulfilment, or surely it is self-evident that, without this outlet for expansion, there can be no hope for our over-populated, over-industrialised and over-taxed land.

I do not want to go into the old argument of Protection versus Free Trade, but I do want to point out that we are not, and never have been, a Free Trade country, but merely a free import country, allowing our industrial rivals thereby to place whatever tariffs they have liked against the exportation of our goods, and refusing to ourselves the only practical instrument that exists for negotiating favourable tariff agreements on the basis of reciprocal trading. The Government of this country, of whatever party it may consist, has now and in the immediate future the greatest chance of securing even greater sheltered markets than we enjoy to-day in the over seas Dominions and Colonies. But let us remember that trade can be successfully carried on only when it is mutually advantageous to the contracting parties, and that on a reciprocal basis we must be prepared to offer in exchange a sheltered market for the products of the Dominions and Colonies, which must of necessity, if it is to be comprehensive and complete, include a sheltered market for the food supplies which they produce.

Can we not see that such a policy, leading towards freer trade within the Empire, must also lead to a gradual unification of the Empire's component parts, spelling not only a wide economic unit, but also the breaking down of the parochial boundaries that keep us apart to-day? When those confining boundaries of thought and location are swept away, the redistribution of the British people on an economic footing within the Empire will come about as naturally as a mighty river flows along its appointed course to the fertile delta of its destiny. Before I conclude may I allude to the admirable and eloquent speech of the hon. Member for Smethwick (Sir O. Mosley). He advances as a possible solution and as a method of consolidating our Empire the idea of bulk purchases. That argument, I agree, has a great deal in it, but, the chief objections to it are these. If you introduce the principle of bulk purchases you at once force the Government, whatever party may be in power, into business, and many of us on this side believe that business is not most efficiently carried on by Governments. That is certainly my personal opinion and I think we had ample experience during the years from 1914 to 1920 from which we can judge.

The other objection is that the bulk purchase scheme recommended by the hon. Gentleman would not meet the views I think of the representatives of the Dominions and Colonies. For years they have been giving this country preferential treatment and they have, rightly or wrongly, built up their own economic units under a protective system. It seems to me that the best method of bringing the various parts of the Empire closer together economically is to introduce some measure for the extension of Imperial preferences, on the lines on which we have been carrying on our policy in the past. If our industries are idle and our people impoverished surely we have only ourselves to blame. There is any amount of work to be done if we only have the will and the ability to do it. Vast territories and vast, wealth lie dormant awaiting development, and a wider economic unit of Empire in my opinion offers the only practical and permanent solution of the many grave problems by which we are beset to-day.


One notices that in debates on Safeguarding figures are frequently quoted showing the danger and the evil effects of foreign imports. Everyone in the House will remember the figures given by a famous Mr. Morris a few years ago in connection with the debates on the McKenna Duties. As I see the hon. and gallant Member for Bournemouth (Sir H. Croft) in his place I may remark that Mr. Morris has a very good successor as far as quoting figures is concerned. I should like to remind the hon. and gallant Gentleman of a statement of his in reference to the effect of the import of woollen goods on Yorkshire. Last year we imported.… woollen manufactures which could have employed the whole of the unemployed in the West Riding. That is a rather astounding statement and it would be a very wonderful thing if, by keeping out these imports, we could employ all the unemployed in the West Riding representing scores of thousands of people. That would be something worth doing, but, unfortunately for the hon. and gallant Gentleman's theory, Mr. Henry S. Clough, employers' leader on the Wool Textile Industrial Council, writing in the same paper and on the same date, says that even on the assumptions that all imports could be excluded by a tariff and that they were all worsted imports. we should not thereby provide work for two-fifths of the looms that are standing in the Bradford district alone. The hon. and gallant Member will forgive me if I say that I must take that gentleman as a bigger authority on the textile trade than the hon. and gallant Gentleman. The hon. and gallant Gentleman declares that if we exclude woollen imports we can provide work for the whole of the West Riding but the textile expert on the spot says that to do so would not provide work for the idle looms in the Bradford district alone, and Bradford is only a part of that vast textile area.

Brigadier-General Sir HENRY CROFT

What is the date of that quotation?


This appeared in the "Daily Telegraph's" Safeguarding supplement. I am sorry that I have not the date but the supplement is a well-known one, and the hon. and gallant Gentleman will have no difficulty in ascertaining the date. The figures which we are given on these occasions must be taken with a few grains of salt. Let us suppose that it is true that these imports are evil from the industrial point of view. I may mention in passing that the right hon. Gentleman the Member for Epping (Mr. Churchill) has said that the import of goods from abroad is not in the slightest degree responsible for the increase of unemployment and the same right hon. Gentleman has pointed out that the greatest amount of unemployment is in the textile, cotton, coal and shipbuilding trades which have a very small proportion of imports and which may be described as being primarily, export trades. But supposing it to be true that imports are evil, who is responsible for the imports? It is not the Government. The Minister of Transport last week in answer to a question said that the Central Electricity Board—typical of many other public authorities—gave 100 per cent. of their orders to British firms providing British goods only. In short, foreign goods are brought into this country mainly by people concerned with private enterprise.

Hon. Members opposite are often termed "captains of industry" and "merchant princes" and some of them are directors of dozens of companies. They are the people who have to a large degree the power of controlling imports and giving orders for goods. They say, on the one hand, that politicians ought not to meddle in business and that they want freedom to control their own businesses. They order these stupendous quantities of foreign goods and then they come to this House and complain about the result. If the importation of foreign goods is an evil thing the remedy is in the hands of hon. Gentlemen opposite. Do not order these foreign goods. It is not true that the average customer goes to a shop and asks for German or Japanese articles. A customer goes into a shop and sees the goods displayed on the counter and those goods are put there by great business interests who support the party opposite.

Only a short time ago a famous motor manufacturing firm in Acton distributed in the pay-packets of the men little leaflets bearing the words "Buy British Goods." The same firm had that week installed three American machines. The first man who got his pay packet took out the leaflet, "Buy British Goods," and stuck it on the American machines, and every worker following, when he got his packet, stuck his leaflet on the machines. What humbug, on the one hand, to give your people a leaflet, "Buy British Goods," and, on the other hand, to order foreign machines, to go in a foreign motor car to a banquet at Olympia to encourage British industries, to have at home a foreign governess or an Indian servant, to have ships manned by Oriental labour, and yet to talk about buying British goods! I suggest that if you have the remedy in your own hands, apply it, and do not blame the Government for the evils for which your own actions are responsible.

We were told by another hon. Member that the foreigner is often under-selling British manufacturers, but he did not say, what is the truth, that although it is a fact that the German and French manufacturers may under-sell the British manufacturer on occasion, in the majority of cases quite obviously it is the British manufacturer who under-sells the foreigner. It has been stated here frequently that we export twice as many manufactured goods per head of the population as any other country in the world, and although German manufacturers do beat us with certain orders, we beat them twice as frequently. It is not true that these low-wage countries, which incidentally are Protectionist countries, have an advantage in competing with us; it is not true that low-wage labour means low prices. The opposite is frequently true. Even hon. Members opposite have often admitted that. You may have low wages and high prices, and you may have high wages and low prices as a direct result. I go so far as to believe that the firms which employ low-paid labour abroad give the British manufacturer a decided advantage, because they have not recognised the real economy of paying the best kind of workers the best kind of wages. It is an advantage to this country, in competition with Italy, France and Germany, that those countries have not recognised an obvious, elementary fact.

Hon. Members are always talking about France having no unemployment. It is not true, by the way; but supposing it were true, what are the facts? This country has 10 per cent. unemployed, or it may be 12 per cent., and France none, but the right hon. Member for Bewdley (Mr. S. Baldwin) says that the average real wages in France are, roughly, 55 compared with 100 in this country. The real wages of the people here are from 50 to 60 per cent. better than the wages in France, and that means that Frenchmen are working for a week for just over half the wage that they would get in this country. If only 85 per cent. of our people are working, surely it is better for 85 per cent. of our people to work at wages 50 per cent. above those paid in France, and even the 15 per cent. who are not working, the victims of private enterprise, with our out-of-work benefit and social services, are nearly as well off as the people who are working full time in Protectionist France. That is a fact which the right hon. Member for Bewdley admitted, showing that, even with our present fiscal system, our Free Trade system, as it is called, we are still immeasurably above the Protectionist countries of Europe.

It is said that we want low prices in the export trades, and I agree. I believe that so long as you must compete for the markets of the world in cotton, coal, and so on, you must compete with low prices, but, as I have said, I refuse to subscribe to the doctrine that low prices can only be obtained by paying the workers low wages. I suggest that there are other and very much more important factors in lowering prices, and as my contribution to this debate I would like to put forward two or three really big ways whereby, in my judgment, the export trades might make substantial reductions in prices without lowering wages at all. If I gave my own authority, people would say, "What do you know about industry?" So I propose to give some important authorities, and the first is Lord Salisbury, leader of the Tory party in another place, who recently said this: If Lord Beaverbrook wants to know why we cannot compote in the markets of the world, let him read the Balfour Report, and he will find that an essential cause is the out-of-date equipment and organisation of our factories and a low standard in their higher control. "Higher control" there does not mean Labour Government control; it means the directors. I will not mention names, but it means the Lord Melchetts, the great people who run our industries. Lord Salisbury went on: or let him read the D'Abernon Report, and he will find that British merchants show a want of adaptability and enterprise. Take another case. The right hon. Member for Bewdley says: I say of my own experience that, since the days when private industry gave place to joint stock company, there have battened on the joint stock companies large numbers of men connected with management and directors, who are parasitical to industry, and nothing but parasitical. That is said by a responsible statesman, not by a Labour Government. There are too many guinea-pig directors, too many men, even in this House, going straight from school—I could give his name, but it is not permitted—at 22, and in six months director of 12 or 15 companies, director of a treacle company, a chemical combine, an engineering firm, a motorcar firm, and a dozen other things; director of an electrical combine, and he could not tell gas from electric light. His sole qualification is that he is his father's son.

I suggest that there are two ways whereby we might economise and lower prices. Hon. Members opposite have told us that it is the brains of the directors that count in industry. If that is true, and if those brains are third rate, let them get rid of those influential people who contribute nothing to industry, but the fact that they are Lord Wormwood Scrubbs' son. Let me give another quotation. It is from the "Daily Express," which is not my usual paper, but sometimes even that paper gets near the truth. Here is a case, in my judgment, which gets the kernel of the whole thing. It says: A board room"£— Hon. Members opposite know about them; they are born into them— is the last place where the truth.… is likely to be heard. There are too many gilded nonentities,"— Hon. Members opposite know about them. They live and dine with them— too much privileged senility,"— That is a nasty phrase to use in a Tory paper, but I will say it again—"too much privileged senility." You know what that means if you listen to a debate in another place— too few men who have risen from the ranks and know their business from A to Z. That is why the British railways are in so pitiable a plight. I agree that we want Safeguarding; I am keen on it. I am keen on safeguarding a high standard of living for our workers, but I would not trust the party opposite in safeguarding wages and conditions. I regard them, rightly or wrongly, as the arch-priests of wage reductions, longer hours and bad conditions. I want safeguarding from German employers, but I want our people safeguarded also from British employers who try to reduce the standard of life. I want industry safeguarded from inefficiency and the hordes of middlemen who, the right hon. Gentleman for Bewdley says, are parasitical. I want industry safeguarded against bad management. If we had these things it would make industry efficient. If we had the best men in control, we should have no need to impose tariffs and Safeguarding, for our industries would be able to compete with any industry in the world. Even to-day we are competing with the low wage countries in Europe, and we are beating them, and we will continue to beat them if our workpeople are given a reasonable chance.


The hon. Member for North Kensington (Mr. West) who has been entertaining us with a very interesting speech, has made a personal allusion to me in particular in his reference to those on this side whom he described as arch-priests of wage reductions. I will throw the lie back in his face.

Mr. DEPUTY-SPEAKER (Mr. Robert Young)

The hon. Member must not address the House in that way.


I apologise, but I feel strongly when such remarks are made in this House, and when such accusations are thrown across to these benches and when we have not sometimes a reasonable opportunity of replying to them. [An HON. MEMBER: "What about Yorkshire?"] I will come to the question of Yorkshire in a few moments, because I want to make a few references to a speech made by the hon. Member for Huddersfield (Mr. J. Hudson) a few weeks ago. A number of figures have been given to the House by the Chancellor of the Exchequer as to the numbers of unemployed in various countries of the world. I have no doubt that every party in the House is imbued with the same desire, namely, to see the enormous army of unemployed diminish, but it so happens that we explore different avenues in order to arrive at a solution of the great difficulty with which we are faced. The right hon. Gentleman the Member for Bewdley (Mr. S. Baldwin) mentioned that the figures of unemployed were being reduced in Germany. I noticed in the Press this morning that the figures in Italy had been reduced during the past month from 377,000 to 322,000.

The Chancellor of the Exchequer mentioned this afternoon that he had received some figures from Los Angeles on the western coast of the United States relating to the enormous percentage of unemployed in that city. He went on to say that it was stated, perhaps with a certain amount of truth, that they had in that country from 4,000,000 to 6,000,000 more unemployed than we have in this country. [An HON. MEMBER: "Seven millions."] Let us assume that he said 7,000,000. During the Easter Recess I happened to be in the United States and Canada, and on every possible occasion I made inquiries from business men, bankers, and so on at various centres as to what they considered were the numbers of unemployed in the United States. It is admitted that they have no definite means of knowing exactly the numbers, as we have in this country, and the best information that I could obtain was in Chicago, which has a population of nearly 4,000,000. The Vice-President of the First National Bank of Chicago told me that, although they had no definite means of knowing the exact numbers of unemployed in that country, he was satisfied that he was taking it on the top side when he put the maximum number of unemployed in the United States since the financial crash last Autumn at not more than 3,500,000. Since then their numbers have diminished, while ours have been increasing. Therefore, the primary reason for this Motion to-day is to try, if we can, to put some suggestions before the House for the diminution of this great army of unemployed, which is growing in such a menacing way in this country.

I am one of those who believe from conviction in Safeguarding. I am not a Safeguarder because I am a Conservative, but I am a Conservative because I am a Safeguarder, and I honestly believe in it. Although I am an industrialist and come from Yorkshire, I say quite frankly that my only desire is to see a diminution of unemployment, and a return to more prosperous times. I believe that a similar feeling actuates the large percentage of Members of this House. In Yorkshire we are proud of the fact that that county has given to this country a Chancellor of the Exchequer, but we are not proud of the fact that that particular Chancellor of the Exchequer is Mr. Snowden, who is the leading apostle of Free Trade in this country. Although he is warm-hearted, he has economically and politically rather a narrow mind. I have often thought during the last 15 months, as I thought while the hon. Member for North Kensington was speaking, that it would be for the benefit of this country and the House if many hon. Members would forget most of the things that they have ever read on economics, and come down from the heaven of economic theories to the present day facts of life and the difficulties which manufacturers have to face. Hon. Members almost convey the impression that they are the only people who have the interests of the country at heart and the desire to do the best to see a better standard of living in this country. I would like to assure hon. Members opposite that there are many hon. Members on this side who, with all their faults, are just as anxious to see a diminution of unemployment as hon. Members on the Government benches.

Canada, India, Australia, the United States and South Africa have all in recent years raised their tariffs against us. The President of the Board of Trade is apparently still carrying on with his foolish Tariff Truce, which has no more hope of achieving anything than the Members of this House have of jumping over the moon. It is time this House took into consideration the fact that this country should look after itself and leave other countries to look after themselves. If we do not tackle this question soon the country will go on to disaster. Hon. Members opposite claim that the heads of industry are inefficient. There are inefficient employers in industry, that is admitted, but surely no hon. Member will say that all heads of businesses are inefficient. Where have the businesses come from which have been built up from small beginnings? There must have been some efficient men somewhere to start them.

The hon. Member for Huddersfield, speaking a few weeks ago on Safeguarding, said that every Safeguarder in the West Riding of Yorkshire was swept away at the last Election. I would remind the hon. Member that the Chancellor of the Exchequer, in one of his speeches, said there was only one left; and as it so happens, I am the one. At the next Election I think Bradford will return some Members who are supporters of Safeguarding. The pendulum is swinging over splendidly in Yorkshire. The hon. Member went on to say that one of the reasons why Bradford is sinking industrially to-day is that there are too many sons of their fathers in industry. Well, there are some fathers and there are some firms who have been inefficient, but does the hon. Member suggest that all these businesses in the Bradford district or in the West Riding are inefficiently conducted?

Looking back over the past 10 years, we find that 476 firms have met their creditors and over 200 have retired from business. On an average, one has gone out of existence every week in the last 10 years, and last year only 40 per cent. of the looms were running to full capacity. Does the hon. Member mean to tell the House that in all those cases the head of the business was inefficient? Every week-end when I am at home I pass, two miles from my own factory, a mill which was founded about 65 years ago. At the end of the War the head of the firm was financially fairly well off, but after six or seven bad years in the wool industry he had to meet his creditors. He made a composition with them and went on again. A few months ago he met his creditors again, and the mill, with the plant and machinery, was put up for auction a few weeks ago. There was no bid for the mill, and the looms, which cost, new, between £80 and £90 each, were sold for £4 each. Those looms are all going to Japan, and I suppose that in time woollen goods made on those looms will come here from Japan. Hon. Members opposite expect that our woollen people in Bradford, Huddersfield, Dewsbury and the other places in the West Riding can pay £2 10s. or £3 a week to their employés and meet the competition from Japan of firms who have low overhead charges because of the cheap machinery they have bought and their low-paid employés. That is the kind of competition we have to face in the West Riding of Yorkshire all the time. In one district near my own city of Leeds a few years ago there were 12 woollen mills. To-day there is not a single one. They have gone out one by one.

The hon. Member for Smethwick (Sir O. Mosley), who was speaking this afternoon, said that what we needed were big mergers—rationalisation, reorganisation. They are very favourite terms with hon. Members opposite. I want this to be accepted in the way I give it, that is, in the kindest spirit, but hon. Members on the benches opposite who, in the main, have never been in business themselves, would teach our people in the West Riding of Yorkshire how to manage the businesses in which they have been engaged all their lives. I can refer to one manufacturer—and the hon. Member for Huddersfield will know the man's name—who is the owner of over 20 mills, of great amalgamations and merges. Where is he to-day? In the hands of the banks. It does not necessarily follow that you get cheaper production with a merger. I can point to small firms in my own industry manufacturing an article as cheaply per unit as the big firms. If this Government had put into operation the findings of the Committee on Safeguarding there would have been no reduction of wages in Bradford, there would have been no dispute, and there would have been better trade than they have in Bradford to-day.

Take the steel industry. The Economic Advisory Council stated in the White Paper: As regards efficiency and management and the modernity and equipment of certain units of plant Britain is equal to and in some cases superior to the iron and steel plant to be seen on the Continent. And still we have Ebbw Vale, with their 4,000 men out of work. What would the hon. Member for Ebbw Vale (Mr. A. Bevan) say about that? He would advocate rationalisation and reorganisation. But what do the people at the head of the concern, who know something about it, say? They say: The whole secret of success in industry lay in the word 'production,' and faced with a loss of nearly 30s. on every ton of steel produced the Board of this company had no option but immediately to close the steel works, throwing idle some 3,000 to 4,000 men. The Continental iron and steel maker had behind him a highly protected home market which would absorb some 75 per cent. of his production. It was immaterial to him at what, figure he sold the surplus, and as the only outlet for the surplus was Great Britain we received the unwanted production of the Continent in our home market. Free Traders seem to forget that Cobden built up his theory on the Protection of distance, but to-day that had disappeared. Then there is the case of Dorman, Long and Company, who have closed their Clarence Works, throwing 2,000 men out of employment. Wages in the steel trade in this country are 65s. 3d. per week as against 37s. in France, 51s. in Germany, 35s. in Belgium and 30s. 5d. in Czechoslovakia. How can hon. Members expect that there should be prosperity in the steel industry so long as Continental countries, with their low wages and lower costs of production, are able to flood our markets?


Germany is now subject to a 10 per cent. reduction.


There is one other point I wish to put to hon. Members opposite. Have trades benefited from Safeguarding? That is the acid test of the whole question. Does any industry which has been safeguarded, or the operatives of it, wish it to be de-safeguarded? I asked a few questions recently regarding the glove industry. Safeguarding was granted to the glove industry in 1926. What is the position there? I have here the annual report for 1929 of the Joint Industrial Council of employers and employed. The number of employés increased from 5,625 in 1926 to 8,987 in 1929. There is not a single unemployed person in the glove industry in this country. In that industry trade has gone up enormously, the exports have gone up, and gloves are cheaper. Not long ago a petition was presented to the Prime Minister, signed by 6,000 employés in the glove industry praying that Safeguarding should not be taken away from that industry. In the report issued by the Joint Industrial Council it says: Even now the employers claim they are not producing all they could had they sufficient skilled workers. But the workers are opposed to any fresh people being taught the principal branches of the industry for fear of Safeguarding being removed with a consequent return to unemployment. 9.0 p.m.

Does the opinion of business men count for nothing with hon. Members opposite? Have hon. Members seen the reports of the various chambers of commerce as to whether they desire Free Trade or the adoption of Safeguarding? The figures are staggering, and in the West Riding of Yorkshire there has been a tremendous swing of the pendulum from Free Trade to Safeguarding. Let me take, as an example, chambers of commerce which are bodies composed of men of no political complexion. For many years, I have been the Chairman of the Council of the Leeds Chamber of Commerce and only a few months ago we had a discussion upon Free Trade and Safeguarding. That was a purely non-political institution composed of members of various political parties and others connected with no party at all. The Huddersfield Chamber of Commerce took a vote on this question and 413 voted in favour of Safeguarding and only 62 in favour of Free Trade. In Sheffield the figures were 515 for Safeguarding and 46 for Free Trade; in Leicester 821 for Safeguarding and 52 for Free Trade. The members of those chambers of commerce are in the main employers of labour. In the Bradford Chamber of Commerce 686 voted for Safeguarding and 101 for Free Trade; in Dewsbury 47 voted for Safeguarding and four against; in Liverpool 88 per cent. voted for Safeguarding and 12 per cent. for Free Trade. In addition to this evidence from chambers of commerce all over the country the Federation of British Industries and the Associated Chambers of Commerce in London have expressed themselves in favour of Safeguarding. Although the hon. Member for Smethwick attached little importance to the bankers' resolution, we cannot close our eyes to the fact that the bankers have stated that they realise that in Free Trade we are fighting a losing battle with the dice loaded against us and with our hands tied behind our backs. It is a fact that wherever an extension of the Safeguarding principle in industry has been tried it has proved of enormous benefit to the country. The right hon. Gentleman the Member for Derby (Mr. Thomas) said at Southampton: The real test will ultimately be our ability to sell our goods to the markets of the world, and to induce customers all over the world to come to us. It is the duty of the Government, first of all, to look after our home markets and protect us against the unfair competition with which we are faced, and which is harassing so many of our industries at the present time.


There seems to have been during this debate a considerable air of unreality. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) asked why the Vote of Censure had been placed upon the Order Paper. Undoubtedly, the reason is that we were at the time the Vote of Censure was put down in the final stages of an interesting by-election in East Anglia, and there was a very great necessity for the Empire Free Trade party and the Conservative party to have some kind of rapprochement if they were likely to succeed. At that time, there seemed to be considerable optimism on the part of the Opposition that they would win the seat, and had they done so then the candidate representing Empire Free Trade might have made his maiden speech on this occasion. The result of that election was not what the Opposition expected, and the fact that the Safeguarding and Empire Free Trade policy has lost the election in North Norfolk has caused the Leader of the Opposition to modify very considerably his own particular views.

I listened carefully to the speech of the Leader of the Opposition, and he did not tell us what he means by further Safeguarding proposals, or the scope of them, or what his attitude will be if he is returned at the next Election towards food taxes or Empire Free Trade. It is a Vote of Censure moved with very little censure and with very little confidence. The Chancellor of the Exchequer, in the concluding part of his speech, made what I consider to be one of the most important observations in this long and interesting debate, when he suggested that the effect of any Safeguarding Measures would be to reduce wages, and that is a proposition which those sitting on the Labour benches will always resist. Any increase in the cost of food or raw materials which we require for our manufactures is really a depreciation of the value of wages, and on those grounds we shall steadily resist it.

The hon. Member for Stockport (Mr. Hammersley), who has an Amendment on the Paper to this Motion, said nothing about the Vote of Censure, but simply expressed his views upon the cotton industry, but he failed to link up a single point in his speech with the big cotton industry of Lancashire. If hon. and right hon. Gentlemen opposite think that they are preparing for themselves a first class battle-cry in Lancashire in connection with Safeguarding, they are suffering under the most weird and fatal delusion that they well could have. I have not heard, nor did I expect to hear, a single pretence of argument as to any benefit that could come to manufacturers or operatives in the cotton trade in Lancashire from Safeguarding. Nearly four-fifths of the raw cotton that we import comes from outside the Empire, and a tax on it will not help us in Lancashire. We remember the tremendous export of capital every year, and the amount of British capital that is now invested in mills in Japan and elsewhere; and we remember, too, that on their own admission—and there are very important statements in the report of the Government's Commission of Inquiry into the cotton industry—the manufacturers of Lancashire realise that the trouble is not the cost of production in the mill, which I am informed, and I think it is not challenged in this House, is less even than the cost of production in Japan. The trouble is the enormous amount of tax placed upon the finished product by the huge array of middlemen who come in. There is no hope for the cotton industry of Lancashire in Safeguarding.

I am open to correction if I am wrong, but, as far as I have been able to ascertain, there has not been a single appeal for Safeguarding in which the evidence did not prove that wages in protected countries were lower than in this country. In fact, the speeches that we have heard this afternoon, including the speech of the hon. Member who has just sat down, contain the complaint of competition from people abroad who work for lower wages than our people here, and the people abroad who are working for lower wages are working in Protectionist countries. The International Labour Bureau, placing London at 100, places the wages in Amsterdam at 87, in Berlin at 67, and in Paris at 55. Hon. Members may be perfectly sure that we on these benches will resist to the last any proposal to reduce the standard of living of our people to this standard, and that is what is involved in this Motion; and not only would the wages of our people be reduced, but, what is even more cruel, the limited amount received by poor people who have fixed old age pensions, and who have no kind of tariff barter, and cannot put up any sort of defence against an increase, but who, out of their small and limited pensions, will have to pay the increased charges involved by taxes on raw materials, manufactured articles and foodstuffs. It has already been pointed out to the House that the question of peace and war is not altogether divorced from the question of tariffs and Free Trade. I should have thought that we had realised by now that what we want is not war in trade, but a real grasp and share of world trade, and this proposal of putting a sort of fence round the British Empire and producing all that we want is too absurd for words.


Has it been absurd in the case of the United States?


I will answer that question by telling the hon. Member what has been said two or three times to-day, and by pointing out that his own Leader has declared it to be both dishonest and absurd. He must argue the matter out with his own Leader. There is no doubt in the minds of those of us who have grasped even the elementary principles of the matter. While we import 60 per cent. from outside the Empire, as compared with 40 per cent. on the most favourable comparison, there is no doubt that this Empire could not immediately set to work to produce everything that we require. It could probably produce little more than one-third of our requirements. If hon. Members think that it could, not one of them has ventured to suggest it in the debate, much less to prove it, and I shall not accept it until it is proved to the hilt, because I am convinced of the contrary. In the last 12 months we have been passing through anxious and critical times, and those responsible have at least done their best to safeguard people who are without employment. For that I am thankful. Whatever there may be of misunderstanding, whatever political prejudice may be brought to bear against us, when we fight the next election, at whatever time it may come—and perhaps hon. Members opposite are not quite so authoritative in fixing the date as they may think—if the cry is to be a cry of Protection or Safeguarding, I am perfectly sure that we shall be back here, not labouring anxiously as to how far a minority Government can go, but with such overwhelming strength that we shall not have to debate these questions, but shall be able to get to work on that change of our social system which is really the prime necessity for the welfare of our people and the prosperity of the Empire.


I think the debate to-day has at any rate proved that we are all moving a little nearer to what has been the Conservative policy for the last 30 years. I do not say anything about those who sit below the Gangway; they are almost as hopeless as the Chancellor of the Exchequer, who, I am afraid, is past learning anything new. It has been stated over and over again that the object of this Safeguarding policy is to reduce wages. This country is extremely proud of its standard of living. We have a higher standard than any continental country, and we propose, not merely to maintain that standard, but to raise it even higher; and we know that we can only do that by such a policy as we are putting forward. The attitude of the Chancellor of the Exchequer is, "Why worry? Other countries have their unemployment, so why worry about ours?" We on these benches do worry, and I believe that there are some on the benches opposite who are worrying as well. Some of the speeches from the benches opposite have shown that hon. Members are beginning to learn something of real economics, instead of the mere theory of them.

Personally, I am particularly interested in the attitude of the Labour party towards this problem. I have had put into my hands to-day an article written by a very well known Labour economist, Mr. G. D. H. Cole, whom, I believe, I am going to have the pleasure of defeating very shortly. Mr. G. D. H. Cole has turned Protectionist, and this, among other things, is what he has to say: In these circumstances, we can no longer afford Free Trade. We must take measures to protect our home market against the products of sweated foreign labour, and seek overseas markets in which we can hope for specially favourable conditions. I have not time to read any more, except this small portion: Free Trade is bound to involve either lower wages or a large permanent mass of unemployment. When we have a gentleman belonging to the Labour party changing his views to that extent, I think we can say that there is some hope for the future of this country, but there will be no hope so long as the Labour party continues to support its present Free Trade Front Bench. What is the position? I believe we are all agreed in this House that the whole world is suffering from over-production—


And yet there is a shortage.


—and yet the only country in the world where that overproduction can be dumped is this country. If you go and visit the docks in London, or anywhere round the coast, you will see ships arriving laden with foreign articles, and going away empty with their propellers out of the water. That is the situation. The Government are responsible for dealing with the present situation. Whoever has been or will in the future be responsible has nothing to do with the case. The Government is responsible for the present situation. What do they propose to do? They propose to do absolutely nothing. We have had put into our hands a report of a delegation which has been for weeks examining the steel industry on the Continent, a very interesting report which should prove to everyone that steel is manufactured on the Continent under conditions which would not be tolerated by any respectable trade unionist in this country, and yet trade unionists are sitting on those benches supporting a Free Trade Government and permitting over 3,000,000 tons of steel to come into the country annually. They are supporting a, policy which takes away from the workers the wages of the production of 3,000,000 tons of steel and 12,000,000 tons of coal. I should be very interested to see what attitude those who represent the miners' interest would take up if it were announced that a ship had arrived with foreign coal at Cardiff docks. We should have a very different attitude on the back benches opposite.

The accusation is frequently made that the industries of the country, particularly steel, are not efficient. I spent several years of my life working on the Continent in a steel works and I have spent several years working in steel works in this country. The report that has been issued to us shows that in many cases plants in this country are quite as efficient as plants on the Continent. I am well aware that there are other plants which are not so efficient, but to bring plant up to date, to reconstruct old plant, is very much more difficult and expensive than building new plant from the very beginning, and the construction of a modern steel plant requires a vast sum of money. I should not like to guess at the amount of money which would be required to place the steel industry here on a better footing than that on the Continent. If we are to obtain that money, we can only obtain it by having some security in the future. At present there is none and, unless the Government take some action to give the industries of the country that security, they will die for ever, and then it will be too late. I would make a final appeal to those who are responsible and honest trade unionists on the opposite benches, not to continue to support a policy which is keeping the men whom they represent out of work and their friends and relations on the dole.


I am sure we are all grateful to the right hon. Gentleman the Member for Bewdley (Mr. S. Baldwin) for putting down this Motion of Censure. It has given us the opportunity of a very valuable debate covering a wide ground. We have heard admirable speeches in the best debating style from the three Front Benches, spiced with quotations from old speeches and filled with questions addressed to the other side, which presumably will not be answered, in accordance with precedent and the immemorial practice of the House. But what we and the country are waiting for is not questions addressed to the other side but answers as to what is the constructive policy of parties in this situation. We got something from the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George). He told us he wanted improved marketing, and he referred very shortly in that connection to cotton and to agriculture. Everyone wants improved marketing in those and in most other industries. The question is, Can it be obtained from the present control and organisation of industries or can it not? For 10 years the cotton trade has been trying to find a way out of its troubles, but the vested interests, looked at from an individual point of view, perfectly proper interests, for example more than a thousand merchant houses in Manchester, have so far been strong enough to prevent it, and there is no sort of indiction that improved marketing arrangements in the Lancashire industry, and also in the woollen and worsted industry, are ever likely to be secured unless a power capable of reorganising those trades is brought into operation, and that is the power of this House.

In regard to agricultural marketing, it is just the same. It is useless to suppose, after all these years, that voluntary methods among tale farmers will achieve it, either in regard to their competition with imported foodstuffs or in regard to the marketing of home produced foodstuffs, and the question which We should all like the right hon. Gentleman to answer is whether he is prepared to continue to drift along and watch industry after industry go into decay, or is he prepared to take the responsibility of backing proposals from these benches, or putting proposals forward himself, for bringing into operation the power of the State drastically to reorganise the marketing at home and abroad of our staple trades. The right hon. Gentleman also referred to the prohibition of dumping. He repeated almost word for word what he said on a previous occasion, that he was prepared to prohibit the importation into this country of dumped goods. I am very interested in a project for that purpose myself, and have been waiting since he first made that suggestion for some sort of indication of how he or any other Member of his party proposes to deal with it. He was very coy about details. He has been entirely silent all these weeks about details, and I have not seen or heard of any sign of support from any of the various wings of the Liberal party in the intervening period.

Let me come to the second speech from the Front Benches—speech as admirable in its dialectics as any that has ever been delivered in this Parliament—that of the Chancellor of the Exchequer. We heard him deal, with admirable skill, with the proposals, contradictions and troubles of the other side. He gave a sort of lukewarm, rather tentative and cautious blessing to the idea of import boards. I wondered how it was that those dark and difficult doubts, which apparently still assail him, were not expressed years ago when the subject was under discussion and was adopted by the party of which he is one of the leaders, and how they have been kept absolutely quiet and silent ever since. But having done that, I confess I am very grateful for it, because it is something that he is going as far as that, and I hope that he will go a great deal further. He then proceeded into the agreeable and familiar paths of traditional Free Trade argument. He put questions to those on these benches—about 40 of us—who put our names to an Amendment which appears on the Order Paper but which, unfortunately, I understand, we shall not have an opportunity of moving. He drew our attention to a phrase there in which we expressed disapproval of both Free Trade and Protection, and he asked us what we meant by Free Trade.

I need not go into a detailed explanation of traditional or other theories of Free Trade. What we meant to say and imply was that the existing condition of the country required a drastic alteration of our fiscal and import and export arrangements. As one listened to the Chancellor of the Exchequer, and to the right hon. Gentleman the Member for Carnarvon Boroughs, when he told us of the very familiar fact that the amount of the export trade per head of this country was twice as much as any other country in the world, and that we still have an enormous home trade or as one listened to the right hon. Gentleman the Member for Carnarvon Boroughs telling us about the numbers of people who live on the coast line and other facts of that sort—all very interesting and picturesque, but very irrelevant—one might have thought that this country had not at this moment 2,000,000 men and women unemployed. We might not have thought that there was a single staple industry that is not in a bad state of slump except, perhaps, the industry of banking, and some branches of the retail trade, or that the export trade, whatever may be its percentage per head, had not fallen behind in the great competition, if you like, of all the exporting countries in the world.

It is quite true that we have still got a very great export trade, but it is the business of this House—and we are all fully aware of it—in dealing with problems of this sort, not merely to look at absolute figures, but at the tendencies. At this moment, the total export trade of the world is well above pre-War figure, but our export trade is still about 20 per cent. below the pre-War figure. In the meantime, the export trade of Germany, of America, and Japan is bounding forward. American exports now are 64 per cent., Japanese 76 per cent. and Italian 32 per cent. above those of 1913. The French exports, though they are affected, no doubt, by the change of boundaries, are twice as much as in 1913. As the right hon. Member for Bewdley reminded us, there appeared in the "Times" this morning two statements side by side which are very significant and well worthy of attention. In one column there were the figures of unemployment, and in the other the figures of the rapid growth of Germany's export trade. In regard to this last figure, I have no time to argue the point in detail, but I am not sure, when the balance sheet comes to be totalled up, of all the victories and defeats of this Government the victory at The Hague, which forced Germany to put all her strength into a rapid increase of her export trade, and which continues the policy started by hon. Gentlemen opposite, will not be one of the greatest disasters that have befallen the export trade of this country. We are deliberately continuing the policy by which Germany could only save herself from bankruptcy by an expanding export trade, so that she had a favourable balance of £70,000,000 to £100,000,000 per annum, in order to pay for Reparations. The rapid rate of growth of the German export trade in the last three or four years is the price we are paying, and shall continue to pay, for that policy.

When you look at our export trade in detail, with the Dominions for example, you will see similar points of disturbance since 1914. Comparing our figures of trade with Australasia and South Africa since 1913 with those of the present day, actually we are exporting about the same as then, whereas the trade of the Dominions with America and with Japan, and to a less extent with Germany, has increased all round. I do not think that any of these figures will give any sort of comfort to those who look at our present fiscal system and present national industrial situation and try to get satisfaction out of the fact—not very certain, in my opinion—that wages and the standard of living are very much higher in this country than in other countries. Those figures, quoted so often in this House with such satisfaction by those anxious to justify inaction, as to the comparative wages in various European markets, are open to very grave modifications and discount which are seldom allowed for. Or take another factor in the situation relating to the present fiscal policy. Is there anybody in this House who gets any satisfaction out of the state of agriculture? Is there anybody who would deny that the decay of British agriculture in these last few decades has been linked up directly and definitely, particularly in the years since the War, with the system of free imports or whatever you like to call it, in which we live at the moment?

Take another point, a figure of which I will make a present to hon. Gentlemen opposite because sooner or later they will discover it, and I am surprised that it has not been discovered up to the present by their very efficient staffs. The right hon. Gentleman the Member for Bewdley talked about the imports of manufactured goods. I have been interested to examine in the detailed returns of the Board of Trade Journal the figures of manufactured goods imported in the first three months of the year and in the whole of last year, and I confess the figures are surprising. Comparing the volume of imported manufactured goods in 1929 with those of 1924, five years ago, which happens to be the year for which actual details are available, in 1929 the imports were 35 per cent. above 1924, and in the first three months of this year—and I believe the figures are approximately the same for the first six months—the imports for manufactured goods are no less than 60 per cent. higher than the corresponding figures for 1924. The corresponding figures for exports of manufactured goods, taking the two periods together, show a rise of something like 4 per cent. In other words, taking 1924 as the year of comparison, the growth of imports of manufactured goods into this country is more than six times in volume the actual increase in the exports.

That is a very serious fact, and it is no good pretending to ourselves, whatever our views may be on fiscal policy, that it does not exist. The explanation is very simple and clear. In the last year or two the whole world has got into a crisis which has limited the demand for goods in the manufacturing countries, and other countries have taken the very simple and easy course of putting into this British market all the surplus which they wish to dump. But hon. Gentlemen opposite need not suppose I would argue that the proper remedy is the sort of proposal which appears in this Vote of Censure. I doubt very much whether any of their Safeguarding Duties or a system of Empire Free Trade would have had any effect on that situation.

The truth of the matter is that the old arguments and methods of Free Trade and the old and new methods of Protection are quite inapplicable to the world as it exists to-day. The other day I came across the case of a particular industry, not a very large industry but an important one, in the town which I represent. It was suffering from the fact that across the other side of the Atlantic the manufacturers in that branch of trade, whose manufacturing and selling costs were normally above the costs and selling prices of our trade here—we could beat them in ordinary free competition—were shipping to this country all the surplus production of the particular lines or products which for any reason were not saleable on the American market, and getting rid of it at any price. It was dumping in its crudest and simplest form. When I examined the details of the matter, I discovered that actually the goods were protected by one of the few tariff duties which are put on, and the fact is that whatever the duty, would have paid the Americans to have got rid of their surplus products instead of allowing them to disorganise their home market. Even if the duty had been of a prohibitive character, it would have been worth while sending the goods here. This illustrates the argument which was used with such effect by my hon. Friend the Member for Smethwick (Sir O. Mosley) a few moments ago with regard to the export of grain.

With this concentration of manufacturing, financial and exporting power in so many countries and in so few hands, with international arrangements as to allocation of markets, with agreements for keeping prices fixed both in the home market and in the export market, neither Free Trade nor Protection has any relevance to our real fundamental problem. We have to seek in this situation a new method. We have to seek remedies which are suited to the disease. In the first place, it seems to me, we have to deal with what is, after all, the fundamental and basic industry, namely, that of agriculture. In regard to that matter, there is no other method which I can see, short of controlling imports so that the farmer gets a remunerative price independent of chance, changes and fluctuations from month to month, from speculation here, from the rigging of the market there, and from surplus production somewhere else, and can go along with his task of cultivating, sure of his price. I need not go into the details of that with regard to wheat, for my hon. Friend the Member for Smethwick put the case admirably. I find myself in only one small disagreement with him—I am not sure whether it is a disagreement—and it is this. From some things which he said it might be assumed, though I believe that it is not the case, that he was contemplating the restriction of our sources of supply solely to the Dominions. If we centralise the importation of wheat, or of meat or of dairy produce, or of other food materials, we have to be in a position to make our purchases in bulk from any world market that can supply us.

I do not want any suggestion to get about that this is an exclusively Imperial scheme. I will grant quite definitely that it would be very much easier and more convenient in many ways to come to contract terms and to terms of reciprocal trade with the Dominions. We should certainly, since it is very much easier and more convenient, and, perhaps, more profitable to both sides, attempt it with the Dominions, and probably in most cases we should succeed. But the fact would remain that we should still require, for a considerable time, to buy a considerable quantity of wheat, and, perhaps, of meat and other produce, from South America. We should need, probably, to buy for a considerable time certain quantities of dairy produce from Denmark, and so on. In regard to all these commodities and all these countries we should propose to apply the methods which are set out in the Amendment which stands in my name and that of my hon. Friends, and we should endeavour not only to get supplies in bulk and give to the British farmer stable, steady prices free from chance, fluctuations and troubles of that sort to which we think he is entitled, but we would also, at the same time, use the bargaining power for bulk contracts in order to get better terms for manufactured goods.

Take Canada. It has been stated frequently in this House that we buy five times as much from Canada as she buys from us. That is an unnecessary situation. From our point of view, it is an unsatisfactory situation. The same applies to Denmark. We are practically the only market, or, at any rate, by far the most important market for practically the whole of the produce of Denmark, and we buy from Denmark each year six times as much as she buys from us in manufactured good's. I suggest that in those cases and in other cases, if we go to the Imperial Conference, and if we enter into negotiations with these other countries with the power to offer their producers a steady market, the best market in the world, with a price not in excess of the accepted level over a period of world prices, but a remunerative price as it would be, we could expect from those countries reciprocal arrangements for our manufactured goods which would undoubtedly be of immeasurable benefit to the trade of this country.

The right hon. Gentleman the Member for Carnarvon Boroughs said that since the War—and he is perfectly correct—we had lost one big factor in international trade. We were not now the country to which all these great Dominion countries and agricultural countries looked for finance for their industries, and that our place in that respect is being taken, and will continue to be occupied, by America. But we have one great factor, one great bargaining weapon in our hands, which America does not possess, and which nobody else possesses. This is the best market in the world for nearly all the goods that these great growing agricultural countries must sell. America cannot offer that, but we can. I submit that the method which we propose is the method by which we can secure to this country the best results of that bargaining power. I do not believe that the method of reciprocal tariffs, apart from all the difficulties with which Members have dealt already, would succeed. I do not believe that it would give to these countries the advantages which they expect and would desire, but the method which we propose would, in my opinion, secure it. I would not restrict it either to foodstuffs. An hon. Gentleman opposite has referred to the state of the cotton and woollen textile industry. I quote the "Times" of a month or two ago, when it was stated: The need for reorganiisation is, perhaps, even greater in the cotton and woollen textile industries than in any other industry in the country. Reorganisation in these industries must start with raw material. As long as their raw material is the sport of gambling operations at Liverpool, Bradford and Sydney, and there is no stability or security of price or of supply, and as long as the price moves with the raw material, and that, therefore, the price of the manufactured article is constantly on the move, it is absolutely impossible to get that steady and secure growth of trade which they need. Apart altogether from the economies that could be effected, and apart altogether from the assistance it would give to the reorganisation of the productive processes of the trade which is so necessary, I am satisfied that our proposal in regard to cotton and wool, to take two cases, would give an opportunity for the development of those trades, and provide opportunities for a reorganisation of those trades which must be taken if those trades are not to continue to fall into decay.

Finally, we on these benches feel that we have to deal with the question of the dumping of produce, exported here by the aid of bounties or by low paid labour. It is no part of the Labour case that in this country we should endeavour by legislative method or by trade union method to protect the labour standards of the people in employment here, and permit them to be undercut by low paid labour in other countries; but the remedy is not—as hon. Members opposite privately, and sometimes publicly, are prepared to advocate—to push down the wages standards here, but to use all the weapons and all the resources we have, and all the pressure that we can bring to bear, for improving wages in other countries. There was a committee, of which the Chancellor of the Exchequer was chairman, which produced a scheme in regard to the prohibition of imports into this country of sweated goods. We on these benches would like to know when the Government propose to bring forward legislation to carry that scheme into effect.

I realise that these proposals involve a drastic breakaway from the old method and the old traditions of trade in this country, and that they do not fall at all in the lines of the ancient and more or less obsolete controversies. This country is at the crisis of its fate as a great industrial country, and in all parts of the House, not only on these benches but on the benches opposite, there is a real desire that the Government should face these urgent problems, now that the Imperial Conference gives it an admirable opportunity to do so, in a spirit of courage, in a spirit of audacity, and with a willingness not always to play for safety but to attempt to deal fundamentally with the grave and perhaps fatal difficulties with which otherwise the country is confronted.


The debate which is now drawing towards its end has produced a number of highly important and illuminating pronouncements. I think that those who have heard the greater part of the debate will agree that not the least interesting or least important of the speeches is the highly Protectionist declaration that has just been made by the hon. Member for East Leicester (Mr. Wise). I always listen to the hon. Member with particular attention, because he seems to have a mind which is completely free from old prejudices and old theories adapted to different conditions from those that reign to-day. He, at any rate, has got before him clearly the fact which never seems to be present to the mind of the Chancellor of the Exchequer, that we have nearly two million people unemployed in this country to-day, and he is not afraid to say openly in this House that we cannot allow the conditions which have produced such a state of things to continue, but that we must, by one means or another, adapt our methods to the conditions which are forced upon us by conditions in other countries.

No greater mistake is made by some hon. Members of the party opposite than to suppose that because we on this side of the House have continually urged the extension of the policy of Safeguarding and of Imperial Preference, we are entirely confined to those two measures when we are considering our difficulties in regard to unemployment. Modern conditions are much more complex than can be solved by slap-dash methods or rigid methods of any kind. They require that every case should be considered upon its merits. What may be good for one kind of industry may be quite unsuitable for another. Do not let hon. Members suppose that we on this side remain exactly where our predecessors were 25 or 30 years ago. Hon. Members on this side are looking at conditions of trade and industry in this country with fresh eyes, and I can assure hon. Members opposite that we are quite prepared to keep an open mind to consider many other methods besides those of tariffs when we have to deal with the unexampled difficulties which confront us to-day.

I did hope that the hon. Member for East Leicester would have developed his particular theory a little more, so that we might have seen haw he proposes to apply it to the multitudinous manufacturing industries in this country which are suffering from what we call unfair foreign competition to-day. Whatever difficulties and objections there may be in regard to the system of import boards and purchase contracts as applied to articles like grain or meat or similar bulky articles of that kind, it seems to me that they would be far greater when you come to every one of those manufacturing industries which, somehow or other, have to be protected to-day. If we take the cotton industry as an example, does the hon. Member really suggest that you can deal with the difficulties of that industry merely by controlling the prices of raw material? [HON. MEMBERS: "No!"] I know that he does not. I know that he wishes to put forward the theory that reorganisation of the industry must take place, a theory to which I do not suppose any hon. Member does not subscribe, but what is to happen to the industry while it is reorganising? That is the question which we have to put to ourselves, and until we find a more advantageous method than the one that we have put forward, we naturally prefer that.

The hon. Member and his friends, powerfully as they have put their case, are not the official representatives of the Government, and in considering the debate we have had to-day and the situation with which are are faced, we have to consider the official pronouncements made by the Members of the Government. Some criticism was made of my right hon. Friend the Member for Bewdley (Mr. S. Baldwin) because he had put down a Motion censuring the Government for excluding from consideration the advisability of reciprocal trade agreements with the Dominions which would involve the imposition of food duties. The words of the Secretary of State for the Dominions were quoted, in which he said: We will enter this Imperial Conference and exclude nothing from our consideration. We will object to nothing. We will discuss everything on its merits."—[OFFICIAL REPORT, 26th June, 1930; col. 1399, Vol. 240.] In the face of such a complete undertaking as that, to exclude nothing, to discuss everything on its merits, what was the case for putting down this Vote of Censure? The complete and absolute justification for our Vote of Censure is the speech of the right hon. Gentleman the Chancellor of the Exchequer. The House will not forget that when the right hon. Gentleman the Secretary of State for the Dominions made that speech he told us that he was speaking on behalf of the Government, and we may assume, therefore, that he had consulted his colleague the Chancellor of the Exchequer and that the Chancellor of the Exchequer had given his consent to a statement in those terms. The Secretary of State for the Dominions said deliberately more than once that he was speaking on behalf of the Government. What are we told to-day? We are told: Oh, yes, we are going to allow full discussion upon any subject or any project whatever, but we have made up our minds beforehand that whatever discussion may take place upon any question of taxes upon food or raw materials, or anything in the nature of protective duties, we will have nothing to do with it.

Why did not the Secretary of State for the Dominions tell us that when he made his speech? Could anybody who listened to what he said have believed that that was the meaning behind his words? Is it not the fact that the mistake of the 'Secretary of State for the Dominions was that he was not speaking for the Government, that he had not obtained the assent of the Chancellor of the Exchequer, because the only alternative to that supposition is that the right hon. Gentleman was trifling with the House and making a statement which bore one meaning on its surface and an entirely different meaning behind it. The Chancellor of the Exchequer in taking up this attitude to-day, which whatever he may say about freedom of discussion practically comes to this, that the question of the duties upon foreign foodstuffs are excluded from practical discussion at this Conference, is going entirely contrary to the opinion of three independent but each of them highly respected and important bodies worthy of the attention of the whole country. I will not say much about the bankers. The remarkable fact that they have so completely changed their minds owing to the change in conditions in this country would not be conclusive to hon. Members opposite, but we have the views of the Economic Committee of the Trade Union Congress who say: The whole question should, however, be looked at without prejudice, and in the light of present day conditions. Then we have the British Preparatory Committee, a committee of business men, who say practically the same thing in rather more extended and emphatic terms. The problem of devising an economic policy for the Empire should be studied in a scientific spirit, free from all political bias, and in the work of any conference which may take place every question affecting inter-Imperial trade should be brought under review and no question should be debarred from discussion owing to political party prejudices or opinions. 10.0 p.m.

The Government have decided to ignore completely these expressions of opinion, to treat them with contempt. They are not going into this Conference with an open mind. They have deliberately barred from the beginning some of the most promising subjects of discussion if agreement is to be obtained, and upon them therefore must rest the responsibility if they fail to obtain the results to which we have all been looking forward as a possibility on this great occasion. I must say a word about the speech of the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George). I regret to learn that he 'has not been able, owing to other engagements, as has happened on several other occasions, to be present throughout the debate and hear any reply that is made to his observations. The right hon. Gentleman devoted the greater part of his speech to an attack upon my right hon. Friend the Member for Bewdley, the bitterness of which was not justified by anything which fell from my right hon. Friend's lips. But perhaps the attitude of the right hon. Member for Carnarvon Boroughs is not difficult to explain. During the last few days he has been suffering under a false and most odious accusation that he has been a party to a conspiracy with the Tories, that, indeed, he was privy to the concealment of 100 Tory Members on a certain occasion with the felonious design of turning out the Government.

Worse than that, his own familiar friend with whom not long ago, last Christmas, he was raising his voice in harmonious strains of sacred song, turned upon him and threw ridicule upon his position in his party of which he said he was only the nominal leader. Perhaps it is not to be surprised that, like Mr. Fagg when he was kicked by his master, the first thing that occurred to him was to vent his wrath not upon his master but upon the first person who came in his way. That does not justify the right hon. Member for Carnarvon Boroughs in misrepresenting the pronouncements of my right hon. Friend, nor does it justify him in accusing my right hon. Friend of a want of honesty and straightforwardness about his policy. It does not justify him when he pretended to quote from my right hon. Friend and say that it was not honest of him to censure the Government in not adopting proposals which he himself had declared the Dominions would never accept. He was deliberately misquoting my right hon. Friend.


Is the right hon. Member justified in saying that my right hon. Friend the Member for Carnarvon Boroughs (Mr. Lloyd George) deliberately misquoted the right hon. Member for Bewdley (Mr. Baldwin)?


I have often heard such statements in this House.


I say that the right hon Gentleman the Member for Carnarvon Boroughs was blind to the terms of the Vote of Censure, and to the expressions which he must have known perfectly well have been applied by my right hon. Friend not to these terms but to the literal definition of Empire Free Trade. The argument of my right hon. Friend was that Free Trade in the literal sense was not possible between this country and the Dominions. My right hon. Friend made his position perfectly clear. He said that if he was in the place of the Government to-day he would go to this Imperial Conference, first of all with the sincere desire to make an agreement and with the conviction that an agreement would be made, that he would be prepared to consider any proposition which would conduce towards making that agreement, that he himself believed that the best bargain that could be made with the Dominions must be one which would ensure for them a secure market for their foodstuffs in this country, and our belief is that the best way to secure that secure market for them is by putting duties on foreign foodstuffs. He made it perfectly clear that if he was in that position he would feel it his duty, if he was able to make an agreement of that kind, to submit it to the people at the General Election. [HON. MEMBERS: "What about the Referendum?"] He made it equally clear that he did not consider that that obligation would lie upon the present Government, because in making an agreement of that kind they would have the support of the party on these benches, and that that in itself constituted so nearly a national mandate that there would be no obligation on the party opposite to go any further.

But, after all, we are not discussing the policy of the Opposition. What we are discussing is the policy of the Government. The Vote of Censure is divided into two parts, which are directed to two different aims. There is, first, the question of the home market, and, secondly, there is the question of the export market. Although these two particular methods of achieving our object are different in the two cases, yet there is a certain amount of interlocking between them, because on the one side the policy of extending Safeguarding offers an opportunity for additional preferences to the Dominions, and on the other side the extension of Imperial preferences would bring to our manufacturers advantages which must increase the purchasing power of our people, and therefore be bound to increase the home market both for industry and agriculture.

That is the answer to the Chancellor of the Exchequer, when he asks how is Safeguarding going to benefit the Dominions? He has not seen that as there are two problems, the home and the export market, so there are two different ways of dealing with them. Our policy of Safeguarding is primarily designed, not to benefit the Dominions, but to benefit the home market. When the right hon. Gentleman suggests that the admission of wheat from the Empire into this country, or of Canadian manufactures from Canada into this country, is not going to benefit the British farmer or the British manufacturer, he only shows how completely he has failed to understand what our policy really is. [HON. MEMBERS: "What is it?"] With the hon. Members' permission I will deal with that later. On this question of Safeguarding, really the Chancellor of the Exchequer exhibits a sort of mediaeval fanaticism. I notice that he made a speech, I think on Saturday last, in which he attributed the world depression mainly, to the effect of Protection—




Largely due to the effect of Protection in raising prices and so diminishing the purchasing power of the people. I should have thought that a man who had been Chancellor of the Exchequer as long as the right hon. Gentleman would not have made so crude, so incorrect a statement as that solemnly and seriously to a public audience. In the course of his speech this afternoon the right hon. Gentleman attributed the troubles of unemployment throughout the world, not to prices being raised, but to prices having fallen.


indicated dissent.


It is a little surprising in a Chancellor of the Exchequer, but the right hon. Gentleman seems, in his intense and fanatical dislike of Protection, to ignore altogether the effect of any fluctuation in the purchasing power of gold. I am afraid that any of the unemployed who have read or may read the speech of the Chancellor of the Exchequer will find very little comfort in it. He told us that last year £335,000,000 worth of manufactured goods were imported into this country. I do not suppose for a moment that the whole of that vast value and volume of goods could have been made here, but it is quite certain that a very large proportion of it is capable of being produced by British workmen. What is that to the Chancellor of the Exchequer? He comforts himself with a phrase which I dare say will be repeated on many platforms hereafter: "If a foreign workman makes goods in his own country to send in here, he is really finding work for a British workman." Doctrines of that kind really belong to another century altogether. The pressure of facts has been accumulating over the last few years, and in particular the weekly rising tide of unemployment is altogether too strong for those who hold views of that kind.

Presently the Chancellor of the Exchequer will find himself alone, because even his own party, as we have heard this afternoon, cannot be content indefinitely to see these things happening and not make some effort to find some remedy more satisfactory than any that has been discovered hitherto. Of course it is not the plan of our party that under an extended system of Safeguarding there should be a duty on every article imported into this country. Such a thing as that has never been attempted, not even in the most protectionist country. [HON. MEMBERS: "Why not?"] Because these things are done on a scientific basis without regard to a rigid and doctrinaire view. We must always reserve to ourselves the power of relaxing our tariffs as a bargaining factor, in order to obtain a lowering of the tariffs of other countries.

The right hon. Gentleman alluded somewhat contemptuously to the little experiments in Safeguarding made by the late Government. I agree that they were little experiments, although if you take into account not merely the industries which are strictly speaking described as safeguarded, but also the McKenna Duties, and the Silk Duty, you have a very much larger field upon which to work. But I am not disposed to argue that in the short range of industries with which we were able to deal, in the short time in which we were able to deal with them, and under the conditions of uncertainty brought about by the reversal of our policy by the right hon. Gentleman in 1924 and again to-day, the figures are sufficiently complete or convincing to convert hon. Members to our views. I declare, however, that there are five main conclusions which one may safely draw from what we have seen with regard to Safeguarding and protective Duties. In the first place, we may say that, when applied to a trade, they stimulate the activities of that trade and consequently provide employment for all kinds of labour, young and old, male and female. I ask the House to compare the advantages which I am claiming for Safeguarding with what can be obtained from the measures which the Government are pursuing in regard to relief works by local authorities.

The first advantage is that by stimulating trades you provide work for every kind of labour. In the second place, I say that the kind of employment which is provided may well be permanent. It is not like a temporary job in the making of a road, the end of which is in sight whether it takes one month or three months or five months. If a trade is prosperous there is no reason why men or women should not be employed in it for the rest of their lives. In the third place, it restores confidence in industry, and its extension would bring back much of the capital which is to-day going abroad, so that it might be used in the development of industry and in that process of rationalisation on which all parties are agreed. It would moreover bring foreign capital into the country—as we have seen happening in the case of the factories erected in connection with the motor trade and the tyre trade. Fourthly, the increase of production brought about by the security of the home market would reduce costs and therefore assist the export trade, and, lastly, in so far as imports would come in, they would produce revenue so that the effect of these measures would be to increase the national income instead of draining it.

I say that no single one of these propositions is controvertible. You may argue that they apply more or less in any particular industry. You may say, if you like, that there are conditions which must also be taken into consideration, but unless you can produce a better plan, unless you can produce a plan which will provide advantages equal to, if not greater than those I have enumerated, your opposition is doomed. You have tied yourselves or you are being tied to the old doctrine of free imports by the Chancellor of the Exchequer. You have put around your necks a millstone which—although, perhaps, you may escape the censure of this House to-night, thanks to allies below the Gangway—will certainly bring upon you the resentment and indignation of a people which is rapidly being brought to despair.

Let me turn to the second, and, as I think, the more important part of the Motion. I thought that at least we should find common ground with the party opposite in the desirability of making reciprocal trade agreements with the countries of the Empire overseas. Those of us who remember a time, not so very long ago, when hon. Members opposite seemed to attach more importance to international than to Imperial unity can only rejoice to see what a long way they have travelled since then, and that they are prepared to recognise to-day That the desire for Imperial economic unity does not necessarily carry with it any aggressive intention towards other nations. I notice that the Prime Minister said the other day that a Labour Government had a better chance than a Government of any other party to make an agreement.

The PRIME MINISTER (Mr. Ramsay MacDonald)

A better chance?


Yes, a better chance. I have the quotation here, and I will give it in order to justify myself.


I am sure it was reported that way.


The right hon. Gentleman said: If the Dominions if to come with us in economic co-operation, if the Dominions and this country were to devise an economic and industrial policy which would be beneficial at all, the Labour Government had a better chance of bringing about that agreement than a Government of any other party in this country. I thought myself at the time that that was true, and I had no doubt that what tape right hon. Gentleman had in his mind was that the Labour Government were the only Government which could count upon there not being a factious Opposition, but I confess that after the speech of the Chancellor of the Exchequer I am obliged to take a different view, because a very large part of the Chancellor's speech was devoted to observations which showed that he does not believe in an agreement for economic unity with the Dominions. He said there was very little probability of the Dominions increasing their trade at all. He said it was very unlikely that Australia would sacrifice her foreign trade for what little advantage she might get out of an agreement of this kind. He said that the whole trend of Australian policy was to foster their own industry.

If that is the spirit in which he is going to enter the Conference, if those are the considerations which are uppermost in his mind, what chance has he of bringing about economic unity in the Empire? Why did he speak only of Australia, whose difficulties to-day everybody knows and sympathises with? Why did he not mention Canada? Has not Canada given ample evidence quite recently of her desire to bring about a closer economic union between herself and the old country? Does not the right hon. Gentleman yet understand that what we have in mind is not merely a question of goods from this country going free into Australia and competing with Australian manufactures, or of Australian products coming free into this country and competing with British products, but that what we want is a system of Imperial rationalisation, which was referred to, I think, by the hon. Member for Smethwick (Sir O. Mosley), under which it should be possible to carry out what I think should be the great principle animating a Conference of this kind, namely, that each country in the Empire should strive to produce what it can best produce to meet the needs of its own people, and that, in so far as it is unable to meet those needs, the deficiencies should be made up by other countries in the Empire rather than by importations from foreign countries?

I quite agree with one hon. Member, who said that it would take a long time thoroughly to explore the possibilities of such a principle as that. It is perfectly true that to-day you have not got the full materials for that purpose. It is only by the setting up of some permanent body which will investigate the subject continuously and which will collect the proper statistics—which are lamentably lacking to-day on the subject—that it can be carried out to its full conclusion, but a start should be made at once. The reasons why we are so insistent upon the necessity for finding a better market for Dominion footstuffs in this country is because foodstuffs play such an important part in the exports of the Dominions. It is very difficult to find reliable statistics which will enable one to see exactly how the trade of the Empire stands, because each Dominion publishes its own statistics in different forms, and it is a work of labour, and not always of certainty, to extract comparable figures. I have tried, however, to ascertain what proportion of the foodstuffs exported by the various Dominions was exported to countries other than the United Kingdom, because that gives an indication of the amount of trade which the Dominions have to do in competition with other countries in foreign markets which they would be glad to see secured to them in this country, which is the best market for them. In New Zealand the percentage is 12¾ per cent.; in South Africa 44 per cent.


These are the Beaver-brook figures.


I hope hon. Members will allow me to finish what I have to say without interruption. What I am saying now is not really controversial. I am trying to finish in time to give the Prime Minister an opportunity. The percentage for Australia is 46 and for Canada 55. On the other hand, here are the figures of the British purchases of foodstuffs from foreign countries which could be produced within the Empire—wheat £28,500,000, maize £12,000,000, bacon and ham £40,000,000, butter £30,000,000, sugar £18,000,000, and eggs £14,000,000.


Have you connected your Front Bench?


These figures show what an enormous field there is for the extension of trade between this country and the Dominions, and they prove convincingly that the interests of the Dominions to make reciprocal agreements with us is so great that it cannot be doubted that they will be willing to give to us corresponding advantages for our produce.


Why does your Front Bench not cheer that?


I must ask the hon. Member to restrain himself at this period of the debate.


I have already said that on this side of the House we are not tied to one particular method of dealing with this problem, but at the same time we are convinced that the method of tariffs is the simplest, the most elastic, the most familiar to other countries, and the easiest to manipulate. In the limited time at my disposal I have not an opportunity of saying much about the scheme of import boards which has been so interestingly put forward by the hon. Member opposite, but I would remind the House that whilst we should be ready to consider in detail any scheme which could be shown to have a reasonable chance of success on those lines the experience which we have had up to the present is hardly such as to invite us to believe that a scheme which worked, indeed, in war time would be equally successful in time of peace. We had not long ago a debate upon another subject in which allusion was frequently made to the work of Sir William Beveridge, who had great personal experience of the system of controlled prices during the War. His conclusion, as I dare say hon. Members will recollect, was that in his view the possibilities of working a scheme of that kind in peace did not indicate to him that it would provide a system which he could recommend in preference to the unrestricted enterprise of private firms.

Let me finish by saying this. The Government's position to-day has been made perfectly clear. The pronouncement of the Chancellor of the Exchequer was, as he promised us it would be, straightforward, unequivocal, unmistakable. The party opposite are tied by him absolutely to the rejection of any system of Protective duties, any system by which a tax may be imposed upon any article of food, no matter what benefits and advantages may be got in return for it, no matter how those advantages may contribute to the reduction of this terrible tale of unemployment. If I were to look at this matter purely as a party man I would rejoice in the speech of the Chancellor, but as one who is convinced that it is only by the policy which is indicated in the Motion of Censure that this country can escape from its present troubles I deeply regret that the Chancellor of the Exchequer has laid down restrictions under which, in my opinion, it is absolutely impossible that the opportunity presenting itself to the Government should be made available to the country; and I am concerned to think that as a result of this Government being in office at a time when this Imperial Conference is taking place the greatest opportunity for laying the foundations of a united Empire that has ever been presented will be lost and thrown away.


The last sentence which the right hon. Gentleman addressed to the House made me most aware of the great problems that wt have been trying to solve during the last two weeks. He referred to the great regret which he felt that this Government were in office, because he was very anxious to produce a united Empire. The Government who were in office in 1926 and agreed to the report which has been presented and the constitutional findings of the Conference of 1926 are the very last Government and the very last party that ought to talk about a united Empire. [HON. MEMBERS: "Why?"] My right hon. Friend has just stated—[Interruption]—that the Chancellor of the Exchequer explained the Government's position in language which was straightforward, unequivocal and unmistakable. [Interruption.]


Hon. Members must allow the right hon. Gentleman to make his speech.


One way or the other, I shall continue to say what I intended to say, and I very much wish that the same adjectives could be applied to the Opposition. The right hon. Gentleman started by making certain reflections upon the difference between what the Secretary of State for the Dominions said and what the Chancellor of the Exchequer said. The Chancellor of the Exchequer said that he was not going to be a party, and the Government would not be a party, to any economic policy, the effect of which would be to reduce real wages; and that he was not going to make bargains with foreign countries or with the Dominions, the effect of which would be to impoverish the mass of the people. The Secretary of State for Dominion Affairs said that, so far as subjects are concerned and so far as discussion is concerned, full power would be given to the Imperial Conference. Is the laying down of certain conditions tantamount to depriving a Government or a party of the right of discussion? If so, what about the right hon. Gentleman himself? The Leader of the Opposition made a speech just before the election about a year ago, which was reported next day to mean that he was in favour of the taxation of food, and he gave a pronouncement to the papers, in which he said: My words must not be taken to mean that I contemplate a tax on imported wheat. The time has changed since a policy of that sort was practical politics. The right hon. Gentleman may say that the taxation of food is not practical politics; and yet he is going into a conference with an open mind and prepared to come to a conclusion about it, whereas, if the Chancellor of the Exchequer says that the taxation of food means the lowering of real wages, he is to be accused of going into the conference with a closed Mind and not able to discuss certain things. In that case, what is the position of the whole Front Bench opposite? I may say that I agree with very little of what the Leader of the Opposition said during the election, but I agree with one thing which he said. According to the "Times" of 19th April, 1929, the Leader of the Opposition said, at the Theatre Royal, Drury Lane, on the 18th April, 1929: We are pledged and shall continue to be pledged not to introduce Protection. We are pledged, and shall continue to be pledged not to impose any taxes on food. If my right hon. Friend ought to be censured by the Opposition for saying that to-day, what about himself? Having given that pledge to the country and having had a majority at the election, and sitting here, would it not have violated that pledge? What is the use of all this talk about my two right hon. Friends? "Ah," say they, "there is the very evil situation of unemployment." I know their mind. There is this very serious situation of unemployment. If the right hon. Gentleman had been talking in the German Reichstag, or in the Japanese Parliament, or in the United States House of Representatives, and had been talking about Safeguarding and Protection, he would have had to face precisely the same problem in a safeguarded and protected country as he is facing to-day. What is the use of drawing distinctions which have no actual reality in relation to one country and another? We are being censured to-night by the Opposition, because we have carried out the pledges that we gave to the country at the last Election—[Interruption]—and the very men who are going to support this Vote of Censure are the men who themselves gave precisely the same pledges for which they are asking that we should be censured.

There has been a good deal of discussion about unemployment and so on, but this is a Vote of Censure upon the Government, and the ground of censure is, first of all, that we have not adopted Safeguarding. The reply of the Government is perfectly plain, and we challenge a reply to it. Can you point out one single country, highly industrially developed, in the same position as we are, but which has been safeguarded or protected, that has not a much more serious problem of unemployment than we have to face at the present time? [Interruption.] The right hon. Gentleman who moved this Resolution, only a few years ago said that Safeguarding was pottering along. Since when has it become a cure? He said, further, that no partial method, such as the Safeguarding of Industries Act, could meet the situation. The situation then was that there were about 1,000,000 unemployed. Apparently the argument of the right hon. Gentleman is that when there are 1,000,000 unemployed Safeguarding is not sufficient to meet the situation, but that when there are 2,000,000 unemployed it is. Not only does he say that, but he feels it so keenly that he moves a Vote of Censure on a Government which refuses to potter along, according to his own definition, and apply measures which do not meet the situation. If ever there was a Vote of Censure that was moved under conditions which did not deserve it, and by right hon. and hon. Members who are least entitled to move it, it is the Vote of Censure that is going to be voted upon within the next quarter of an hour.

The second part of the Resolution deals with the Dominions. There are some curious suggestions made in that second part of the Resolution. When hon. Members talk about rationalisation between the Dominions and ourselves, are they aware of the fact that there is not a single Dominion at the present moment but that believes that, with a free hand to develop its economic possibilities, it can expand in the most boundless way, and that to go to them now—Canada or Australia or New Zealand—and say, "Let us rationalise upon present production," would simply be met with a point blank refusal. There is not a Dominion that will agree to rationalisation upon present conditions and will not insist upon a free hand to develop its own industries behind its own tariff walls. The suggestion is made that, if we tax foreign food and let in Dominion food free, then the Dominions will come to some sort of industrial bargain with us [An HON. MEMBER: "Possibly!"] It must be more than possibly. I say there is no one who is acquainted with the Dominions' industrial mind or industrial Policy who even believes that it is possible that we can go to Canada, say, and make this proposal, "We will tax Argentine wheat and let Canadian wheat in free, and the bargain we expect is that you should open your doors to the import of our manufactured materials"—


It is the policy of the present Canadian Government.


The right hon. Gentleman is drawing more on his imagination than on his knowledge. He knows perfectly well, from the negotiations he had in his time with the Canadian Government, that he would come up against the opposition of the steel industries and the coal industry of Eastern Canada. There is a strong and, from their own point of view, a reasonable combination of interests. He knows perfectly well that the most dangerous proposition we could put up to the Government of that Dominion would be to sell the Eastern interests in order to buy the Central and Western agricultural interests. [Interruption.] The point I am making is that there is not a single Dominion which can give us substantial preference on manufactured articles in relation to industries which they themselves are establishing behind tariff walls in return for advantages for food imports. [Interruption.] Does anyone suggest that when the next adjustment of tariff walls is made we are going to get a law tariff wall which makes our competition with Dominion products effective in return for free imports of food [An HON. MEMBER: "Yes!"] I happen to know personally every Dominion, and I have never discovered yet a Dominion prepared to do such a thing as that. If we let in our Dominions' products free, what of our own farmers? If there are to be free imports of Dominion agricultural goods, in accordance, at any rate, with the theories and policies of the Opposition, what have our farmers to say to a policy like that? Will it help our farmers if the Argentine is taxed, but Canadian wheat is allowed in free? If we help our farmers on the other hand, would Canada be indifferent?

We have been conducting a very active campaign in favour of the use of British agricultural products. Everybody here must know that that has given rise to a very considerable amount of awkwardness in Canada itself. There has been a very considerable campaign attacking us for our British products consumption propaganda, on the ground that it was taking from our markets opportunities which had hitherto been used by Canadian agricultural growers. And when the question arose about securing the British farmer by a system of wheat quotas, the Canadian Government was certainly not at all indifferent to the proposal, even at the stage when it was only a proposal, and had not been adopted by the Government. Hon. Members talk about give-and-take with the Dominions and about taking their agricultural produce, but these Dominions would ask, "Would you give us special advantages in secondary production which you yourselves are promoting?" [An HON. MEMBER: "What about America?"] If hon. Members would concentrate their minds upon this point, they know perfectly well that Preference tariffs in 90 per cent. of cases have been devised so high that it does not matter very much what the tariff wall for foreign imports is. When I was in Australia in 1906, they were discussing one of the Imperial Preference Bills, and the whole controversy turned upon the effectiveness of the Preference wall.

I have only five minutes to deal with the whole thing, but there is no doubt at all that if tariff walls are examined, it will be found that the Preference wall is efficient in order to protect Dominion manufacturers, and nobody knows that better than the right hon. Gentleman opposite. One comes to this, that, as a matter of fact, all this question of tariffs is purely mid-Victorian. We hear used the argument about Cobdenism being dead and belonging to an old order of things. It may be that the same argument applies equally to tariffs. The idea that under modern economic conditions of competition tariffs are going to protect standards of life is as dead as any Protectionist ever imagined Cobdenism was. The right hon. Gentleman talked about Germany. The advantage of Germany does not consist in its tariffs, but in the organisation of its capital, the organisation of its marketing and the organisation of its whole scheme of production, and the reply to all sorts of competition that belongs to a low grade of production is, higher and more efficient organisation. On those lines we are conducting our inquiries into marketing boards, import boards, bulk purchasing boards and so on.

Really, I cannot understand why some hon. Members will go into the Lobby against us to-night. Next Autumn we are to meet the Imperial Conference. The subjects that will be dealt with will not be vetoed by us in any sense whatever. The scope of the discussion will be precisely what the Dominions and ourselves require and ask for. The position which the Government will take up on food taxes will be precisely the position that every party in this house took up when it was asking for votes at the General Election. The questions which we shall explore will be questions in the nature of bulk purchase and more efficient organisation. We are prepared, and we shall be prepared, to discuss with the Dominions all the proposals which they may make to knit us closer and closer together, not only politically but economically as well.

As far as this Vote of Censure has a bearing upon the Imperial Conference, really it is an exceedingly bad example of Satan reproving sin. If hon. Members opposite had been sitting here instead of us, and if they had carried out their Election pledges, every word, every restriction which my right hon. Friend sitting by me made, would have had to be made by them, because they would not have been able to say that they were prepared to sacrifice the standards of life of our people in order to give something to the Dominions. [HON. MEMBERS: "Oh!"] Are hon. Members prepared to sacrifice the standards of life of our people in order to come to some sort of agreement with the Dominions on economic grounds? [An HON. MEMBER: "What about the 2,000,000 unemployed?"] We are not going to improve the position of our 2,000,000 unemployed by reducing the standard of life.

We are going to see a most wonderful spectacle. We are going to see the right hon. Gentlemen who gave pledges at the Election that they would not do certain things, walking into the Lobby to-night to censure the Government for also refusing fusing to do them. We are going to see right hon. Gentlemen go into the Division Lobby to censure us for taking up a position at the Imperial Conference which they themselves would have had to take up. They know perfectly well that we shall approach the subject in a hard, businesslike frame of mind, and that every advantage that this country can get from that Conference will undoubtedly be got.

Question put,

"That this House, believing that a return to prosperity can best be promoted by Safeguarding the home market against unfair foreign competition and by expanding the export market by reciprocal trade agreements with the Empire overseas, regrets that the Government has reversed the policy of Safeguarding instead of extending it and has arbitrarily excluded from consideration the imposition of duties upon foreign foodstuffs devised to obtain equivalent advantages for British manufactures and agriculture in British markets and elsewhere."

The House divided: Ayes, 241; Noes, 312.

Division No. 435.] AYES. [10.59 p.m.
Acland-Troyte, Lieut.-Colonel Cranborne, Viscount Howard-Bury, Colonel C. K.
Ainsworth, Lieut.-Col. Charles Crichton-Stuart, Lord C. Hunter-Weston, Lt.-Gen. Sir Aylmer
Albery, Irving James Croft, Brigadier-General Sir H. Hurd, Percy A.
Alexander, Sir Wm. (Glasgow, Cent'l) Crookshank, Capt. H. C. Hurst, Sir Gerald B.
Allen, Sir J. Sandeman (Liverp'l., W.) Croom-Johnson, R. P. Iveagn, Countess of
Allen, Lt.-Col. Sir William (Armagh) Culverwell, C. T. (Bristol, West) Jones, Sir G. W. H. (Stoke New'gton)
Allen, W. E. D. (Belfast, W.) Cunliffe-Lister, Rt. Hon. Sir Philip Kindersley, Major G. M.
Amery, Rt. Hon. Leopold C. M. S. Dalkeith, Earl of King, Commodore Rt. Hon. Henry D.
Ashley, Lt.-Col. Rt. Hon. Wilfrid W. Dalrymple-White, Lt.-Col. Sir Godfrey Knox, Sir Alfred
Astor, Maj. Hn. John J. (Kent, Dover) Davidson, Rt. Hon. J. (Hertford) Lamb, Sir J. Q.
Astor, Viscountess Davidson, Major-General Sir J. H. Lane Fox, Col. Rt. Hon. George R.
Atholl, Duchess of Davies, Dr. Vernon Law, Sir. Alfred (Derby, High Peak)
Atkinson, C. Davies, Maj. Geo. F. (Somerset, Yeovil) Leighton, Major B. E. P.
Baillie-Hamilton, Hon. Charles W. Davison, Sir W. H. (Kensington, S.) Lewis, Oswald (Colchester)
Baldwin, Rt. Hon. Stanley (Bewdley) Dawson, Sir Philip Llewellin, Major J. J.
Balfour, George (Hampstead) Dixey, A. C. Locker-Lampson, Rt. Hon. Godfrey
Balfour, Captain H. H. (I. of Thanet) Duckworth, G. A. V. Locker-Lampson, Com. O. (Handsw'th)
Balniel, Lord Dugdale, Capt. T. L. Long, Major Eric
Beamish, Rear-Admiral T. P. H. Eden, Captain Anthony Lymington, Viscount
Beaumont, M. W. Edmondson, Major A. J. McConnell, Sir Joseph
Berry, Sir George Elliot, Major Walter E. Macdonald, Capt. P. D. (I. of W.)
Betterton, Sir Henry B. Erskine, Lord (Somerset, Weston-s. M.) Macquisten, F. A.
Bevan, S. J. (Holborn) Everard, W. Lindsay MacRobert, Rt. Hon. Alexander M.
Birchall, Major Sir John Dearman Falle, Sir Bertram G. Maitland, A. (Kent, Faversham)
Bird, Ernest Roy Ferguson, Sir John Makins, Brigadier-General E.
Boothby, R. J. G. Fermoy, Lord Margesson, Captain H. D.
Bourne, Captain Robert Croft Fison, F. G. Clavering Marjoribanks, E. C.
Bowater, Col. Sir T. Vansittart Ford, Sir P. J. Mason, Colonel Glyn K.
Bowyer, Captain Sir George E. W. Forestier-Walker, Sir L. Meller, R. J.
Boyce, H. L. Frece, Sir Walter de Merriman, Sir F. Boyd
Bracken, B. Fremantle, Lieut.-Colonel Francis E. Mitchell, Sir W. Lane (Streatham)
Braithwaite, Major A. N. Galbraith, J. F. W. Mitchell-Thomson, Rt. Hon. Sir W.
Brass, Captain Sir William Ganzoni, Sir John Mond, Hon. Henry
Briscoe, Richard George Gault, Lieut.-Col. Andrew Hamilton Moore, Sir Newton J. (Richmond)
Brown, Col. D. C. (N'th'l'd., Hexham) Gibson, C. G. (Pudsey & Otley) Moore, Lieut.-Colonel T. C. R. (Ayr)
Brown, Brig,-Gen. H. C. (Berks, Newb'y) Gilmour, Lt.-Col. Rt. Hon. Sir John Morden, Col. W. Grant
Buchan, John Glyn, Major R. G. C. Morrison, W. S. (Glos., Cirencester)
Buckingham, Sir H. Gower, Sir Robert Morrison-Bell, Sir Arthur Clive
Bullock, Captain Malcolm Grace, John Muirhead, A. J.
Burton, Colonel H. W. Graham, Fergus (Cumberland, N.) Newton, Sir D. G. C. (Cambridge)
Butler, R. A. Grattan-Doyle, Sir N. Nicholson, O. (Westminster)
Butt, Sir Alfred Greene, W. P. Crawford Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)
Cadogan, Major Hon. Edward Grenfell, Edward C. (City of London) Nield, Rt. Hon. Sir Herbert
Carver, Major W. H. Gretton, Colonel Rt. Hon. John O'Connor, T. J.
Castle Stewart, Earl of Gritten, W. G. Howard Oman, Sir Charles William C.
Cautley, Sir Henry S. Guinness, Rt. Hon. Walter E. Ormsby-Gore, Rt. Hon. William
Cayzer, Sir C. (Chester, City) Gunston, Captain D. W. Peake, Capt. Osbert
Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.) Hacking, Rt. Hon. Douglas H. Penny, Sir George
Cazalet, Captain Victor A. Hall, Lieut.-Col. Sir F. (Dulwich) Percy, Lord Eustace (Hastings)
Chadwick, Capt. Sir Robert Burton Hamilton, Sir George (Ilford) Peto, Sir Basil E. (Devon, Barnstaple)
Chamberlain, Rt. Hn. Sir J. A. (Birm., W.) Hammersley, S. S. Pilditch, Sir Philip
Chamberlain, Rt. Hon. N. (Edgbaston) Hanbury, C. Power, Sir John Cecil
Chapman, Sir S. Hannon, Patrick Joseph Henry Pownall, Sir Assheton
Christie, J. A. Hartington, Marquess of Ramsbotham, H.
Churchill, Rt. Hon. Winston Spencer Harvey, Major S. E. (Devon, Totnes) Rawson, Sir Cooper
Cobb, Sir Cyril Haslam, Henry C. Reid, David D. (County Down)
Cockerill, Brig.-General Sir George Henderson, Capt. R. R. (Oxf'd, Henley) Remer, John R.
Cohen, Major J. Brunel Heneage, Lieut.-Colonel Arthur P. Rentoul, Sir Gervais S.
Colfox, Major William Philip Herbert, Sir Dennis (Hertford) Reynolds, Col. Sir James
Colman, N. C. D. Hills, Major Rt. Hon. John Waller Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Colville, Major D. J. Hoare, Lt.-Col. Rt. Hon. Sir S. J. G. Roberts, Sir Samuel (Ecclesall)
Courtauld, Major J. S. Hope, Sir Harry (Forfar) Rodd, Rt. Hon. Sir James Rennell
Courthope, Colonel Sir G. L Horne, Rt. Hon. Sir Robert S. Ross, Major Ronald D.
Ruggles-Brise, Lieut.-Colonel E. A. Stanley, Lord (Fylde) Waterhouse, Captain Charles
Russell, Alexander West (Tynemouth) Stanley, Maj. Hon. O. (W'morland) Wayland, Sir William A.
Salmon, Major I. Steel-Maitland, Rt. Hon. Sir Arthur Wells, Sydney R.
Samuel, A. M. (Surrey, Farnham) Stewart, W. J. (Belfast, South) Williams, Charles (Devon, Torquay)
Samuel, Samuel (W'dsworth, Putney) Stuart, Hon. J. (Moray and Nairn) Wilson, G. H. A. (Cambridge U.)
Sandeman, Sir N. Stewart Sueter, Rear-Admiral M. F. Windsor-Clive, Lieut.-Colonel George
Sassoon, Rt. Hon. Sir Philip A. G. D. Thomas, Major L. B. (King's Norton) Winterton, Rt. Hon. Earl
Savery, S. S. Thomson, Sir F. Withers, Sir John James
Shepperson, Sir Ernest Whittome Tinne, J. A. Wolmer, Rt. Hon. Viscount
Sinclair, Col. T. (Queen's U., Belfast) Titchfield, Major the Marquess of Womersley, W. J.
Skelton, A. N. Todd, Capt. A. J. Wood, Rt. Hon. Sir Kingsley
Smith, Louis W. (Sheffield, Hallam) Train, J. Worthington-Evans, Rt. Hon. Sir L.
Smith, R. W. (Aberd'n & Kinc'dine,C.) Tryon, Rt. Hon. George Clement Wright, Brig.-Gen. W. D. (Tavist'k)
Smith-Carington, Neville W. Turton, Robert Hugh Young, Rt. Hon. Sir Hilton
Smithers, Waldron Vaughan-Morgan, Sir Kenyon
Somerville, A. A. (Windsor) Wallace, Capt. D. E. (Hornsey) TELLERS FOR THE AYES.—
Somerville, D. G. (Willesden, East) Ward, Lieut.-Col. Sir A. Lambert Commander Sir B. Eyres Monsell
Southby, Commander A. R. J. Wardlaw-Milne, J. S. and Major Sir George Hennessy.
Spender-Clay, Colonel H. Warrender, Sir Victor
Adamson, Rt. Hon. W. (Fife, West) Dukes, C. Jones, Henry Haydn (Merioneth)
Adamson, W. M. (Staff., Cannock) Duncan, Charles Jones, Rt. Hon. Leif (Camborne)
Addison, Rt. Hon. Dr. Christopher Ede, James Chuter Jones, Morgan (Caerphilly)
Aitchison, Rt. Hon. Craigie M. Edge, Sir William Jones, T. I. Mardy (Pontypridd)
Alexander, Rt. Hon. A. V. (Hillsbro') Edmunds, J. E. Jowett, Rt. Hon. F. W.
Alpass, J. H. Edwards, E. (Morpeth) Jowitt, Sir W. A. (Preston)
Ammon, Charles George Egan, W. H. Kedward, R. M. (Kent, Ashford)
Arnott, John Elmley, Viscount Kelly, W. T.
Aske, Sir Robert Evans, Capt. Ernest (Welsh Univer.) Kennedy, Thomas
Attlee, Clement Richard Foot, Isaac Kenworthy, Lt.-Com. Hon. Joseph M.
Ayles, Walter Forgan, Dr. Robert Kinley, J.
Baker, John (Wolverhampton, Bliston) Freeman, Peter Knight, Holford
Baldwin, Oliver (Dudley) Gardner, B. W. (West Ham, Upton) Lang, Gordon
Barnes, Alfred John Gardner, J. P. (Hammersmith, N.) Lansbury, Rt. Hon. George
Barr, James George, Major G. Lloyd (Pembroke) Lathan, G.
Batey, Joseph George, Megan Lloyd (Anglesea) Law, Albert (Bolton)
Beckett, John (Camberwell, Peckham) Gibbins, Joseph Law, A. (Rosendale)
Bellamy, Albert Gibson, H. M. (Lancs, Mossley) Lawrence, Susan
Benn, Rt. Hon. Wedgwood Gill, T. H. Lawrie, Hugh Hartley (Stalybridge)
Bennett, Capt. Sir E. N. (Cardiff C.) Gillett, George M. Lawson, John James
Bennett, William (Battersea, South) Glassey, A. E. Lawther, W. (Barnard Castle)
Bentham, Dr. Ethel Gossling, A. G. Leach, W.
Bevan, Aneurin (Ebbw Vale) Gould, F. Lee, Frank (Derby, N. E.)
Birkett, W. Norman Graham, D. M. (Lanark, Hamilton) Lee, Jennie (Lanark, Northern)
Bondfield, Rt. Hon. Margaret Graham, Rt. Hon. Wm. (Edin., Cent.) Lewis, T. (Southampton)
Bowen, J. W. Granville, E. Lindley, Fred W.
Bowerman, Rt. Hon. Charles W. Gray, Milner Lloyd, C. Ellis
Broad, Francis Alfred Greenwood, Rt. Hon. A. (Colne) Logan, David Gilbert
Brockway, A. Fenner Grenfell, D. R. (Glamorgan) Longbottom, A. W.
Bromfield, William Griffith, F. Kingsley (Middlesbro' W.) Longden, F.
Brooke, W. Griffiths, T. (Monmouth, Pontypool) Lovat-Fraser, J. A.
Brothers, M. Groves, Thomas E. Lowth, Thomas
Brown, C. W. E. (Notts, Mansfield) Grundy, Thomas W. Lunn, William
Brown, Rt. Hon. J. (South Ayrshire) Hall, F. (York, W. R., Normanton) Macdonald, Gordon (Ince)
Buchanan, G. Hall, G. H. (Merthyr Tydvil) MacDonald, Rt. Hon. J. R. (Seaham)
Burgess, F. G. Hall, Capt. W. G. (Portsmouth, C.) MacDonald, Malcolm (Bassetlaw)
Burgin, Dr. E. L. Hamilton, Mary Agnes (Blackturn) McElwee, A.
Buxton, C. R. (Yorks, W. R. Elland) Hamilton, Sir R. (Orkney & Zetland) McEntee, V. L.
Caine, Derwent Hall. Hardie, George D. McGovern, J. (Glasgow, Shettleston)
Cameron, A. G. Harris, Percy A. McKinlay, A.
Cape, Thomas Hartshorn, Rt. Hon. Vernon Maclean, Sir Donald (Cornwall, N.)
Carter, W. (St. Pancras, S. W.) Hastings, Dr. Somerville Maclean, Neil (Glasgow, Govan)
Charleton, H. C. Haycock, A. W. McShane, John James
Chater, Daniel Hayes, John Henry Malone, C. L'Estrange (N'thampton)
Church, Major A. G. Henderson, Right Hon. A. (Burnley) Mander, Geoffrey le M.
Clarke, J. S. Henderson, Arthur, Junr. (Cardiff, S.) Mansfield, W.
Cluse, W. S. Henderson, Thomas (Glasgow) March, S.
Clynes, Rt. Hon. John R. Henderson, W. W. (Middx., Enfield) Marcus, M.
Cocks, Frederick Seymour. Herriotts, J. Markham, S. F.
Collins, Sir Godfrey (Greenock) Hirst, G. H. (York W. R. Wentworth) Marley, J.
Compton, Joseph Hirst, W. (Bradford, South) Marshall, Fred
Cove, William G. Hoffman, P. C. Mathers, George
Cowan, D. M. Hollins, A. Matters, L. W.
Daggar, George Hopkin, Daniel Maxton, James
Dallas, George Hore-Belisha, Leslie Melville, Sir James
Dalton, Hugh Horrabin, J. F. Messer, Fred
Davies, E. C. (Montgomery) Hudson, James H. (Huddersfield) Middleton, G.
Davies, Rhys John (Westhoughton) Isaacs, George Millar, J. D.
Day, Harry Jenkins, W. (Glamorgan, Neath) Mills, J. E.
Denman, Hon. R. D. John, William (Rhondda, West) Milner, Major J.
Dickson, T. Johnston, Thomas Montague, Frederick
Dudgeon, Major C. R. Jones, F. Llewellyn (Flint) Morgan, Dr. H. B.
Morley, Ralph Runciman, Rt. Hon. Walter Taylor, R. A. (Lincoln)
Morris, Rhys Hopkins Russell, Richard John (Eddisbury) Taylor, W. B. (Norfolk, S. W.)
Morrison, Robert C. (Tottenham, N.) Salter, Dr. Alfred Thomas, Rt. Hon. J. H. (Derby)
Mort, D. L. Samuel, Rt. Hon. Sir H. (Darwen) Thurtle, Ernest
Moses, J. J. H. Samuel, H. Walter (Swansea, West) Tillett, Ben
Mosley, Sir Oswald (Smethwick) Sanders, W. S. Tinker, John Joseph
Muff, G. Sandham, E. Toole, Joseph
Muggeridge, H. T. Sawyer, G. F. Tout, W. J.
Murnin, Hugh Scott, James Townend, A. E.
Nathan, Major H. L. Scrymgeour, E. Trevelyan, Rt. Hon. Sir Charles
Naylor, T. E. Scurr, John Turner, B.
Newman, Sir R. H. S. D. L. (Exeter) Sexton, James Vaughan, D. J.
Noel Baker, P. J. Shaw, Rt. Hon. Thomas (Preston) Viant, S. P.
Noel-Buxton, Baroness (Norfolk, N.) Shepherd, Arthur Lewis Walkden, A. G.
Oldfield, J. R. Sherwood, G. H. Walker, J.
Oliver, George Harold (Ilkeston) Shield, George William Wallace, H. W.
Oliver, P. M. (Man., Blackley) Shiels, Dr. Drummond Wallhead, Richard C.
Owen, Major G. (Carnarvon) Shillaker, J. F. Walters, Rt. Hon. Sir J. Tudor
Owen, H. F. (Hereford) Shinwell, E. Watkins, F. C.
Palin, John Henry. Short, Alfred (Wednesbury) Watson, W. M. (Dunfermline)
Paling, Wilfrid Simmons, C. J. Wedgwood, Rt. Hon. Josiah
Palmer, E. T. Simon, E. D. (Manch'ter, Withington) Wellock, Wilfred
Perry, S. F. Simon, Rt. Hon. Sir John Welsh, James (Paisley)
Pethick-Lawrence, F. W. Sinclair, Sir A. (Caithness) Welsh, James C. (Coatbridge)
Phillips, Dr. Marion Sinkinson, George West, F. R.
Picton-Turbervill, Edith Sitch, Charles H. Westwood, Joseph
Pole, Major D. G. Smith, Ben (Bermondsey, Rotherhithe) Whiteley, Wilfrid (Birm., Ladywood)
Potts, John S. Smith, Frank (Nuneaton) Whiteley, William (Blaydon)
Price, M. P. Smith, H. B. Lees- (Keighley) Wilkinson, Ellen C.
Pybus, Percy John Smith, Rennie (Penistone) Williams, David (Swansea, East)
Quibell, D. F. K. Smith, Tom (Pontefract) Williams, Dr. J. H. (Llanelly)
Ramsay, T. B. Wilson Smith, W. R. (Norwich) Williams, T. (York, Don Valley)
Rathbone, Eleanor Snell, Harry Wilson, C. H. (Sheffield, Attercliffe)
Raynes, W. R. Snowden, Rt. Hon. Philip Wilson, J. (Oldham)
Richards, R. Snowden, Thomas (Accrington) Wilson, R. J. (Jarrow)
Richardson, R. (Houghton-le-Spring) Sorensen, R. Winterton, G. E. (Leicester, Loughb'gh)
Riley, Ben (Dewsbury) Stamford, Thomas W. Wise, E. F.
Riley, F. F. (Stockton-on-Tees) Stephen, Campbell Wood, Major McKenzie (Banff)
Ritson, J. Stewart, J. (St. Rollox) Wright, W. (Rutherglen)
Roberts, Rt. Hon. F. O. (W. Bromwich) Strachey, E. J. St. Loe Young, R. S. (Islington, North)
Romeril, H. G. Strauss, G. R.
Rosbotham, D. S. T. Sullivan, J. TELLERS FOR THE NOES.—
Rowson, Guy Sutton, J. E. Mr. Allen Parkinson and Mr.
Charles Edwards.