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"NorgS^' and '*£rdswold." From the cod and herring fisheries to whaling in Arctic
seas. From the Scalds to the poet Holberg, down to Ibsen and Bjamsson. The
Bautasten scored with runic characters. The great markets. Hanseatic mooopolies.
The timber trade, the mines, pilotage. Army and Navy, and from the Palace to the Httle
mountain soeter perched on tlue edge of a rock, and beyond, and above all, the beanty of
the deep Fjords, the splendid skies, the wooded sk^>e8, and the inborn courtesy of the
Norseman.

FLORENCE AND THE CITIES OF NORTHERN TUS-
CANY, WITH GENOA. By Edward Hutton. With Sixteen lUustratioDs
in Colour by William Parkinson, and Sixteen other Illustrations.

Following the "Cities of Umbria," Mr. Hutton has written in much the same way a
book <m Northern Tuscany, and since most travellers approaching Tuscany, for the first
time at anv rate, go fint to Genoa, which city Mr. Hutton q>eaks of as the Gate of Italy,
he hflis included that city in his book. Genoa Z« Stt^^ria, then, is dealt with first, the
reader being given an impression of the place^ of its great port and triumphant shuns,
followed by an historic sketch, and a guide to its treasures of Architecture and Painting.
Leaving Genoa, Mr. Hutton leads us along; the fiunous Corniche road through Rapallo,
Portofino, Chiavari, and many a little Riviera town to Speaa, Portovenere, and Lend.
Then passinginto Tuscany at Sarzans^ we pass on to Canrara with its quarries, Massa,
Serrayezza, Fietrasanta, and Viareggio, to Pisa, With its marvellous group of noUe
buildings and old churches to Livomo, with its curious castle and port, and then up the
valley of the Arno to Pontedera and San Miniato, coining at last through Empoli, that
ne^ected place, to Montelupo and Signa, and so to Florence. Many duipters are given
to Florence, whose ^oeless treasures and great men are dealt with in Mr. Hutton's
well-known manner. Leaving Florence at last, we pass on to Vallombrosa. and so into
the Casendno, and Monte Falterona, and La Vema ; then following the Arno from its
source we return through Arezzo to Florence. Leaving Florence, we come to Prato
and Pistoja and so to Lucca, then leaving the valley we climb into the musical Garfiig*
nana Pass and so to Fivizzano through Ba^i di Lucca, Baiga, and Castelnuovo.

Avoiding the arid interjections of the guide-book, Mr. Hutton's volume will be found a
delightful companion, full of every sort of information on this ioumey. No lover of
Tuscany should fail to possess it.

METHUEN & CO., 36 ESSEX STREET, LONDON, W.C

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THE COTTON TRADE 6i

Protection was partial and small at first, and was
usually conceded in response to various plausible
pleas — fostering infant industries, compensating
home manufactures for increased domestic taxation,
or other assumed desirable purposes. Irresistibly,
however, the sense of equality and the importunity
of the non-protected interests sufficed to bring
them into the circle of privilege. No feature in
the history of Protection is more striking than
the inevitable tendency of favoured classes to hold
together and to assist new claimants for privilege,
especially if they make themselves strong by
association. The process is well known in the
United States by the name of" log-rolling." Mutual
assistance in raiding the pockets of the people it
might perhaps be more exactly called. Thus a true
imperium in imperio becomes firmly established.
When Mr. Cobden was discussing his project of an
Anglo-French treaty of commerce with Napoleon
III. he pointed out the numerical insignificance of
the manufacturers whose opposition the Emperor
hesitated to encounter. He replied, " The protected
industries combine, the general public do not."
That is always a formidable factor to be reckoned
with in every Protectionist country, and it is a phase
of the subject which Englishmen should keep well



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62 PROTECTION AND INDUSTRY

in their minds at the very b^inning of a crusade
the like of which has bound other nations fast in
the iron grasp of monopolist supremacy.

We must proceed, then, upon the assumption
that the preferential duties on food and retaliatory
duties on dumped manufactures will be the be-
ginning, not the end of the reactionary movement.
Mr. Chamberlain has told us that a duty on raw
cotton is not contemplated, but some of his sup-
porters are more consistent with his original
purpose, for they talk of the vast possibilities of
cotton cultivation in India, in West Africa, and in
the West Indies, and of encouraging it by pre-
ferential duties. Let us take it for granted, how-
ever, as was said above, that Lancashire spinners
will be allowed, as at present, to buy cotton
wherever they can find it without fiscal impedi-
ment, especially since they are making strong
efforts to extend the growth of the staple in British
dominions, and have protested against any de-
parture from Free Trade. But the cotton industry
consumes many kinds of raw material besides
cotton. It uses enormous quantities of flour and
other farinaceous substances, and large amounts
of tallow, leather, skins, wood, iron, steel, bleaching
chemicals, dyestuffs, and numerous other acces-



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THE COTTON TRADE 63

series, all of which would be made substantially
dearer under a Protectionist system. If anyone
should think lightly of an import duty on grain
and other farinaceous substances in this connection
he will be surprised to learn that the very small
duty imposed on these commodities in 1902, and
removed last year, cost one company in the cotton
industry — a very large one, it is true — not less
than ;^4,ooo a year. There can be no doubt, then,
•that the adoption of a Protectionist policy will add
seriously to the co3t of production in the British
cotton industry. What this means it is easy to
realise when we remember how extensively British
cotton goods are exported to neutral markets in
payment for merchandise imported from them by
Protectionist countries which cannot pay for it
directly because of the high cost of their own
production. Economy in manufacture, and, as an
important factor in that, unfettered access to the
cheapest sources for all the materials and neces-
saries of production, is the secret of our power
to retain the supremacy in the world's markets for
cotton goods.

The table on pages 54, 55 shows the distribution
of our exports of all kinds of cotton manufactures
and yams sent oversea in 1902 to foreign countries



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64 PROTECTION AND INDUSTRY

and to British possessions respectively. The total
amount was ^^72457,675, of which ^^42,598,706
was sent to foreign countries and ^^29,858,969 to
British possessions. Of the last-named item not
less than ;f 18442,140 represents the value of the
exports to India, leaving only ;f 11416,829 as the
value of those to all the self-governing and Crown
colonies. Now the whole of this trade, foreign,
Indian, and colonial, is carried on in unaided com-
petition with the cotton industries of the world,
excepting the very small proportion of it which
receives preferential treatment in Canada. The
shipments to Canada under this special arrange-
ment were ;f 1,396,820. Canada also received an
important amount of cotton goods from the United
States, but in all other parts of the empire the
competition from other countries is exceedingly
small. We have here undoubted evidence of the
power of the British cotton industry to hold the
pre-eminence, and this it owes in no small measure
to the fact that it is able to obtain, without fiscal
obstacle, all the materials and requisites of the
industry on the most economical terms. This
advantage would be largely destroyed if a Pro-
tectionist system were set up in the United
Kingdom.



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THE COTTON TRADE 65

But there is a further consideration which should
have great weight in discussing the effect of the
new proposals upon the British cotton industry.
A considerable proportion of the ^^42,598,706 of
cotton productions exported to foreign countries
is sent to highly Protectionist States, which give
most-favoured-nation treatment to them because
of the Free Trade policy pursued hitherto by the
United Kingdom. Is it wise to surrender this
advantage, conceded without bargain ? There is a
disposition in some quarters to treat lightly this
remarkable fact, that nations which seek to force
trade by means of fighting tariffs can get no better
terms from their opponents than those which the
latter accord to us of their own free will. But it
is manifestly a tribute to the efficacy of consistent
adherence to our traditional policy and to its
practical value, which can be appreciated only by
trying to realise how altered would be our position
in this respect if the policy were once abandoned.
This view of the matter is of special importance
to the cotton industry. In spite of hostile tariffs,
the greater proportion of its exported productions
goes to foreign countries, and it is now proposed
to adopt a course which would gravely imperil it,
to say the least



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66 PROTECTION AND INDUSTRY

Another consequence of adopting the pre-
ferential proposals brings them into a position
which can hardly be described by a milder ad-
jective than ridiculous. We are asked to put
duties on foreign food in order to encourage the
colonies to send us larger supplies. Important
and increasing quantities of butter are coming to
our markets from Canada and Australia. But
more important amounts of it come into our
markets from Denmark and Holland. Now these
countries impose duties on our manufactures of
about 5 per cent, and in Denmark there is a
promising movement on foot in favour of absolute
Free Trade. But the Canadian duties on our
manufactures are about 24 per cent, after allowing
for the preferential abatement, and the Australian
duties are considerably higher. The proposal,
then, is that we should penalise nations which are
already not far from a Free Trade basis already
in order to favour the food products of certain
sections of our own Empire whose Customs
systems are vastly less liberal. Is this the way
to encourage the spread of Free Trade abroad?
It must be remembered, too, that in the case of
Holland her East India colonies, Java and the
rest, are very large consumers of English cotton



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THE COTTON TRADE 67

goods, the exports of them thither last year having
been ;f 1,500,000, or actually more than the ex-
ports to Canada. These are admitted on pre-
cisely the same terms as Dutch cotton manu-
factures. It would surely be the height of folly
to invite Holland and Denmark, by inequitable
treatment of their food products at our ports, to
go back from their comparatively liberal Customs
system and partially close markets for our cotton
goods which now employ a very considerable pro-
portion of the spindles and looms of Lancashire.



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V

THE COAL TRADE

BY SIR CHARLES McLAREN, BART., M.P.

THE coal trade is not, and is never likely to be,
assailed by the competition of imports from
abroad, but there is no trade which is so funda-
mentally dependent upon the general prosperity
of the country and upon the capacity of the con-
sumer, both at home and abroad, to take its
products. As there could never be a question of
putting an import duty on coal, the probable effect
of Protection upon the coal trade cannot be esti-
mated from past experience or from what is now
often called the Cobdenite point of view, but will be
regarded by the trade, favourably or the reverse,
according as it will increase or diminish the output
and the cost of production. An enormous capital
is sunk in collieries in this country, and an enor-
mous number of men are employed. The third

68



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THE COAL TRADE 69

partner in the trade — viz. the royalty owner — is
practically safe whatever happens ; but any rash
and ill-considered interference with the ordinary
course of trade in these islands may mean ruinous
loss not only to the coalowner but to the men em-
ployed in colliery operations, to the trades that
supply collieries with plant and stores, to the village
shopkeeper with whom the men's wages are spent,
and, in some degree, to the freight agencies, such as
railways, canals, docks, and ships, which derive a
very important part of their revenue from the trans-
port of fuel. The coalowner sometimes gets little
sympathy from the public when trade is good and
prices are high, and no one has ever suggested that
he at least would gain anything from "fiscal
changes." It is, however, generally forgotten that
by the "coalowner" is really meant a large body
of middle-class men and women who have invested
their savings in the shares of colliery joint-stock
companies, and who are quite clever enough to
decline a gamble when all the risks are against
them. As to the profits of the trade, I have for
twenty-five years been intimately concerned with
the colliery operations of some of the largest joint-
stock companies in that trade, and I can state
from my own knowledge that while now and then



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70 PROTECTION AND INDUSTRY

there is a big boom with handsome returns, the
average earnings of the capital invested in collieries
would probably not work out above lo per cent,
and in many cases are very much lower. The rate
of wages now paid to miners is high, considering
the price of coal ; but work is not always plentiful,
and in ordinary times, in summer, few miners
make more than a fair living wage, hardly
earned, amid conditions full of danger and dis-
comfort It is the shareholder in the mines and
the collier who will have to say yes or no to any
proposal that may endanger such prosperity as
they now enjoy ; and when it is remembered that
for every shilling that coal costs ninepence re-
presents the wages paid in producing it, the risk
that the labouring classes will have to face if the
basis of our trade is tampered with is far greater
than they are likely to accept

It is suggested that food and manufactured arti-
cles should be made dearer by protective or pre-
ferential duties, and the workman is told that if he
pays more for his loaf, his meat, and his other pur-
chases, he will get higher wages. Higher wages
to-day in collieries would mean the elimination of
all profit to the coalowner, and would restrict that
free and constant expenditure upon colliery plant



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THE COAL TRADE 7«

and improvements which are essential to the safety
of the miner and which bring prosperity to scores
of metallurgical trades, whose profits would in their
turn suffer by diminution of the coalowner's re-
sources. On the other hand, the miner would
pocket nothing by his increased wage if he had to
pay more for his food. Probably, however — and
the further reduction of wages in Durham which
has just been announced supports this view— he
would not get his increased wage. His spending
resources would be diminished, to the loss of his
family as well as of the shoemaker, tailor, and pro-
vision merchant with whom he deals. Trade in the
commodities these supply would be pro tanto re-
stricted, and the restriction would be felt by both
employers and wage-earners in the shoe and hosiery
factories of Leicester and Northampton, the cloth-
ing districts of Yorkshire, and by all engaged in
the import and distribution of food. Forced by
the resulting diminution of income to economise
their expenditure, all these persons would reduce
their consumption of house coal, and so make
matters worse still for the house-coal pits, which,
everybody knows, are the least profitable collieries
even in good times.

Suppose, however, the dear food policy were



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72 PROTECTION AND INDUSTRY

abandoned and preferential duties were placed on
what are usually called manufactured articles only.
I say nothing about raw materials proper, as we are
now led to understand that the Government dare
not interfere with them, though it must be remem-
bered that for the practical purposes of many
trades manufactured imports are raw materials.
Steel blooms, billets, and forgings are highly
wrought products, but to the maker of tinplates,
manufactured steel, electric and other machinery,
machine tools, engines, locomotives, and — most
important of all — ships these are raw materials.
There is no trade upon whose prosperity the
prosperity of the coal trade more closely depends
than the iron and steel trades of this country,
and anything which would cause the closing down
or partial employment of engineering works,
foundries, and shipyards would mean an enor-
mously decreased consumption of coal, followed
by an immediate collapse of prices all over the
mining districts. Every coalowner would agree
that, whatever the condition of trade may be,
profits can only be maintained, having regard to
the heavy burden of constant general charges, by
the largest output which his pits can produce.
Even, therefore, if he could maintain his prices at



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THE COAL TRADE 73

the pit by accepting the situation and reducing
his output his profits would certainly vanish, and
all practical men know that in the competition of
trade coalowners do work their pits to the last
possible ton, even at low prices, rather than dis-
miss men and close districts for want of profitable
orders. In other words, it is less difficult and risky
to turn out as much coal as you can and try to
sell it in the open market at the best price that
will secure the order rather than to try to maintain
prices by working two days a week or losing your
men. Whichever course, however, is adopted, the
next step which suggests itself is to knock 10 per
cent off miners' wages, and so try to earn a little
profit at their expense.

Now this is exactly what would happen if our
tinplate mills, engineering shops, and shipyards
were to be forced to run on higher-priced mate-
rials, whether those higher prices were caused by
direct tariffs intended to exclude what are called
"dumped" goods from Germany or the United
States, or whether they were caused by a general
rise in the price of commodities caused by a pro-
tective policy, followed by a demand for higher
wages by the working classes. A big shipyard
and steelworks will consume anything between a



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74 PROTECTION AND INDUSTRY

hundred thousand and a quarter of a million tons of
fuel in the year, while the amount of fuel used in
the smelting of pig iron and the manufacture of
the endless variety of products which go to make
up the modern ship would be difficult to calculate.
At the present moment wages in this country in
the iron and steel trades are about double what
they are in Belgium and Germany, and it is well
known that a big ship can be built almost as
cheaply at Stettin as on the Tyne or Clyde. Ship-
owners are not philanthropists, and if they see
their way to get a boat at a couple of thousands
less abroad than they would have to pay here they
will place their order with the foreigner. At pre-
sent our shipyards are just able to hold their own,
in spite of the extra wages we pay, because we
have the command of what are probably the
cheapest materials in the world; and the ship-
builder will tell you that, as far as he is concerned,
he only regrets that steel goods are not dumped
down in his yard by the benevolent foreigner at
less than cost more often than is the case. The
long and short of it is this, that if anything is done
which will have the effect of raising the cost of
labour and materials in intermediate trades, the
cost of the finished article, whether it be mining



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THE COAL TRADE 75

machinery for the Transvaal, steel rails for India
and the Argentine, hardware for the Chinese mar-
ket, or ships for our own trade, will rise to a price
by which competition in the neutral markets of
South America, India, and China will all be in
favour of the foreigner, whose longer hours and
lower wages make up the difference to him in his
costs. Is this a state of things that the English
workman is prepared to face ? It is to his pocket
that the capitalist is certain to look for recoupment
of his losses ; and if, as is probable, the English
workman declines to bear these losses, many of
the industries of the nature I have referred to will
be closed down, coke, slack, and steam coal will be
thrown back on the market, and a ruinous time
will be in store for everyone connected with the
coal trade. Even in foreign exports this state
of things might in the long run react against the
coal trade, for, supposing ships become dearer,
freights would rise, and with high freights the
Mediterranean and Baltic markets are affected,
and in the latter case brought more within the
reach of the Westphalian and Bohemian coal-
owner, who can send his coal down to any part of
the German coast, thanks to the cheap rates of
State railroads, at a price which puts English coal.



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76 PROTECTION AND INDUSTRY

already handicapped by railway rates to the port
of shipment, at a very heavy disadvantage. If, on
the other hand, the volume of our foreign trade be
reduced from any cause whatever, it is obvious
that the foreigner will buy less coal from us, and
in this way less coal would go for bunkers as well
as in the shape of cargo.

These considerations point to a still worse state
of affairs should the operation of Mr. Chamber-
lain's policy result in the whole of our com and
meat supplies coming from the colonies instead
of foreign countries. Excluding the coal used
in bunkering ships in British ports, we export
40,000,000 tons a year for foreign consumption,
chiefly to the Black Sea, the Mediterranean, the
Baltic, South America, and even the Pacific coast
of the United States. The wages to miners re-
presented by this output are close on ;f 1,000,000.
This coal goes out at nominal freights, because
the vessels make their profit on the homeward
cargoes which they bring of corn, meat, iron ore,
and other products. The United States cannot
compete with this trade, because they exclude the
homeward cargoes ; and so, by virtue of our low
outward freights, we monopolise the business in
coal. Should we by preferential or protective tariffs



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THE COAL TRADE 77

destroy or endanger the homeward traffic, it would
mean the collapse not only of the coal trade at
home, but of shipbuilding and steelmaking too, and
tens of thousands of our most highly skilled and
best-paid artisans would be driven to starvation.

When it is remembered that Mr. Chamber-
lain's proposal is intended to benefit our colonial
cousins and is not put forward even by him
primarily for the benefit of the Englishman at
home, one is tempted to ask what can the colonies
do for the coal trade in return? The answer of
course is — Nothing. Already Australian coal is
taking the place of our own in the bunkers of
liners in the Far East, and everybody knows that
the coal deposits of Canada are of enormous
value and of easy access. If we take the coal and
iron trades together it will probably be found by
the next generation that the most dangerous com-
petitor with the English coalowner and ironmaster
will be, not the American or the German, but the
Canadian, who is already beginning to develop ores
of the richest quality and cheaply-got fuel, so as
to produce steel at a rate which would be impos-
sible in this country, where nearly all ores suitable
for steel-making have to be imported from abroad.
Any present sacrifice, therefore, by the coal industry



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78 PROTECTION AND INDUSTRY

for the benefit of our colonies could never be
counterbalanced by future trade conditions. We
should not only suffer more severely to-day from
German and Belgium competitors, who would
practically trade in the neutral markets at our
expense just as much as if they had a bounty given
to their exports, but our children would have the
mortification of seeing that we had helped "to build
up a coal and steel industry in Canada, which
would mean irretrievable ruin to the metallurgical
trades here, even if Germany and Belgium were
swept out of the way. That of course means a catas-
trophe to the coal trade which would be felt for
generations. This must never be forgotten, for the
idea that the United States will be the nation ever
to compete seriously with us on our own shores in


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Online LibrarySir Swire SmithProtection and industry → online text (page 5 of 16)