The Eve of the Campaign. By Calchas

Mr. Chamberlain: The Protagonist and the Future. By Calchas

The Wreck of the Unionist Administration. By Sigma
The Unionist Plunge into Protection. By Autonomos

Pinchbeck Protectionism. By Autonomos

Setting Back the Clock of Empire. By Diplomaticus

Behind the Scenes in Scottish Politics

VHEN the Editor of the FORTNIGHTLY REVIEW did me the honour •k for an article on Mr. Chamberlain's scheme of Preferential Ta ffs, I was quite sure that he was not inviting me to teach his Ters what every Englishman knows about his country's econoposition.1 I supposed that he wanted the impression produced upon a Frenchman, well acquainted with the results of a Protectionist policy, seen at close quarters, by the spectacle of a statesman as eminent and as shrewd as Mr. Chamberlain seeking to urge England into a similar path.

The astonishment produced on the Continent by Mr. Chamberlain's speech at Birmingham on May 15th was as great as if nothing had led up to it. Yet, twenty years ago, about the year 1880, when France was repudiating her 1860 Tariff, and Ge many was putting her Tariff of 1879 into execution, certain pessimists were prophesying so loudly the ruin of England, if she did not revert to Protection, that Lord Farrer was obliged to write his book, Free Trade versus Fair Trade. In 1885, a Commission was appointed to enquire into the Depression of Trade. It reported in favour of maintaining Free Trade; but four of its members, describing themselves as "Fair Traders," published a separate report, proposing a duty of ten per cent. upon manufactured goods imported, and upon articles of food coming from

(1) A man need do no more than read Lord Avebury's Free Trade and British Commerce.

foreign countries, when those commodities could be produced by the Colonies and India.

These proposals have ever since found a certain acceptance. In 1896, at the very moment when the Cobden Club were celebrating the Jubilee of Free Trade and the fiftieth anniversary of the abolition of the Corn Laws, Mr. Chamberlain proposed a Customs Union with the British Colonies. At the same time, Mr. Ernest Williams, a member of the Fabian Society, produced a great sensation by publishing a book called Made in Germany. The Board of Trade actually thought it necessary to commission the well-known statistician, Sir A. E. Bateman, to publish a Memorandum on the Comparative Statistics of Population, Industry and Commerce in the United Kingdom and some Leading Foreign Countries, so that at any rate exact figures might be available for discussion. The German bogey was laid, but the American one took its place, and in 1902 Sir A. E. Bateman had to draw up a fresh Memorandum, this time principally concerned with the United States. June 30th, 1902, saw the opening of the Colonial Conference, in which all the Premiers of the self-governing Colonies took part, and Mr. Chamberlain let it be seen that he wished "to establish the principle of Free Trade within the Empire, while recognising the exigencies of all new countries." He specially emphasised the action taken by Canada in the direction of a Preferential Tariff for British goods.

The first resolution adopted declared that the principle of preferential duty would stimulate and facilitate mutual commercial intercourse; but the second declared “ that in the present circumstances of the Colonies it is impracticable to adopt a general system of Free Trade between the Mother Country and the British dominions beyond the seas." However, the third added that “it is desirable that Colonies give substantial preferential treatment to the products and manufactures of the United Kingdom." In the fourth resolution, "the Prime Ministers of the Colonies respectfully urge on H.M. Government the expediency of granting in the United Kingdom preferential treatment to the products and manufactures of the Colonies, either by exemption from or reduction of duties now or hereafter imposed."

Mr. Chamberlain's speech of May 5th is nothing but the practical outcome of Resolution IV. If you are to grant favourable tariffs, tariffs must exist. At present colonial products enter England quite free; the Colonies can have no more complete freedom, but by driving back the products of other nations under differential duties you can assure them a position of privilege. The principle of "Free Trade within the Empire" involves, therefore, the abandonment of Free Trade in the United Kingdom, but

does not involve the abandonment of Protectionism in the Colonies even with regard to the products of the United Kingdom. It would be interpreted as merely granting them differential rates, such as Canada's rebate of 33 per cent., and the rebates of 25 per cent. and 10 per cent. which have been suggested for South Africa and New Zealand.

II.

Economic Rivalry and Political Rivalry.

One sees at once the difference between this scheme and either the German Zollverein of 1834 or the Inter-State commerce of the United States. The Zollverein was a customs union of all the German States, and the duties levied at the frontier were divided amongst the different States on a pro rata system according to population. In the United States, again, it was only a question of collecting customs dues for the profit of the Union.

Could the resolutions of the Colonial Conference result in any such system? It is amazing to find a man who so prides himself upon his logic as Mr. Balfour declaring that

"If the British Empire is to remain a number of isolated economic units, it is useless to hope that this branch of the Anglo-Saxon race can ever be destined to attain the marvellous economic future which is undoubtedly opening before the United States."

Here comes in the conditional alternative which is urged in opposition to the dogma of Free Trade. England's colonies are scattered over the face of the globe, instead of being grouped close together like the German and American States. The selfgoverning Colonies will naturally preserve their economic autonomy; whatever proposals the United Kingdom might make, no matter how tempting, would clash with the view held by each colony of its own interests. No doubt it is a great advance that the old masterful way of dealing with the Colonies should yield to a new and amicable compact. England is thereby insured against any revolt like that which led to the independence of the United States. But to assume that a customs union cements political union and must necessarily establish friendly relations between the individuals who reap its benefits is to show a strange indifference to facts.

In the Zollverein from 1834 onwards, Prussia represented a liberal economic policy whilst South Germany was Protectionist, and the two parties were in continual conflict. After 1860 Prussia concluded a liberal treaty with France, and thereby forced the other members of the Zollverein either to break away or to follow her lead. As for United States politics, they have always oscillated round this question of tariffs; and it may fairly be said

to have done as much as the Slavery Question to bring about the War of Secession. Quite recently we have seen the M'Kinley Tariff of 1890 raising duties or extending them to raw materials and commodities hitherto exempt, and Protectionists endeavouring to gain adherents in the South by giving a direct bounty to the domestic producers of sugar in Louisiana. The Wilson Tariff (1894) suppressed the duty on wool, and reduced the duties upon woollen goods. M'Kinley's election put the Protectionists in power again, and the Dingley Tariff (1897) restored the duty on wool, and took off those on woven goods. These shocks expose commerce and industry to periodical crises, which bring to light the secret enmities between representatives of this and that interest.

Not only does Protectionism plunge the country which adopts it into a war of tariffs with all other countries, but even within the country it rouses a spirit of antagonism in every district which thinks itself sacrificed to other districts, and in every industry which demands to be protected over and above other industries and at their expense. In fact, under Protectionism, economic rivalry gives place to political rivalry.

Neo-Protectionists cannot treat this as an a priori assertion, for it is confirmed by the daily experience of every Protectionist country. I have had special opportunities of seeing how private interests combine against the public interest in the French Parliament. The whole art of M. Méline, who has been the Protectionist leader for close on twenty-five years, has consisted in uniting groups of often contradictory interests, paying court to them, effecting bargains between this and that party, always to the detriment of the consumer, who is the general public. The policy of studying the general interest is left out of account. "Beetroot strikes a bargain with wine; cotton and iron come to an understanding." There in a nutshell you have the rôle which Protectionism plays in parliamentary life. There have been many gibes about the instability of French Ministries, and the fall of this or that Minister and this or that Cabinet has been attributed to this or that political event. But the event was only a pretext; in reality the Minister or the Ministry came to grief because some Protectionist appetite had not been satisfied, and Protectionists are quite insatiable.

The Protectionist spirit produces in a man both the mania of persecuting and the mania of being persecuted. Every claimant for Protection wants to make out, and ends by believing, that he is the victim of all his compatriots who are more favoured than himself; and he diverts a large share of his strength, initiative, and vital energy from his business, and expends them in