MR. GLADSTONE ON FAIR-TRADE.

MR. GLADSTONE has rarely shown his easy mastery of figures to greater advantage than in those passages of his Leeds speeches in which he sifted the evidence for the alleged decay of British Trade. The Fair-trade agitation is a mixture in almost equal proportions of ignorance and impos- ture, and it was quite time that the flimsiness of its " facts " and the hollowness of its remedies should be authoritatively 'exposed. For such a task there is no living Englishman whose qualifications can be compared with those of Mr. Gladstone. His reputation as the most successful and accomplished finan- .cier of modern times is so unhesitatingly recognised by all parties, that it may almost be said to have become a national tradition ; and even the Tories, who deny him every other form of political capacity, recognise his supremacy in this particular department. Mr. Gladstone, gain, is the only speaker who can conquer the popular sus- picion of statistics. The feeling which is almost universal in large miscellaneous audiences, that figures are not only dull, but delusive, and can be manipulated by experts to suit any view or prove any conclusion, entirely vanishes under the spell of his persuasive oratory. The figures are found to be interest- ing, and at the same time the inferences which he draws from them are felt to be irresistible. This is by far the most unique of Mr. Gladstone's great rhetorical gifts, and at Leeds last week he gave the Pair-traders abundant reason to regret that though he has had comparatively few occasions for its exercise in recent years, it is still as fresh and as potent as in the days when he demolished Mr. Disraeli's budgets, and c impelled the House of Lords to acquiesce in the repeal of the paper duty. Mr. Gladstone dealt with the whole Fair-trade case, point by point. The Fair-traders allege that, in consequence of our system of " one-sided " Free-trade, British commerce has fallen off both in volume and in profitableness, and the evidence ordinarily produced to support this assumption is drawn from a comparison between the state of our industries ten years ago and their present condition. A more fallacious method of argument can hardly be imagined. In 1871, Eng- land was as much a Free-trading country as she is in 1881. And notwithstanding that in one or two instances their tariffs have since then been made more stringent, our leading foreign customers were, with scarcely an exception, Protectionists in 1871, as they are now. The proper way of testing the effects of Free-trade upon British industry is to go back to the time when both our customers and ourselves were alike Protectionists, and to see whether we have gained or lost by the change. This is what Mr. Gladstone did, and in order to make the investigation as thorough and far-reaching as possible, he selected for comparison, on the one hand, the admitted growth in the population ; and on the other, the figures which best indicate the relative prosperity of the several classes which compose it. Mr. Gladstone did not present his audience with an array of dry statistics ; but, after his fashion, en- livened and illuminated the figures with a running commen- tary of criticism. But the figures by themselves are suffi- ciently eloquent :—

Population Income from Land,

1842

26,500,000 ...

1880.

35,000,000

Increase Decrease percent. per cent

33 ... — Trades, and Pro-

fessions 2251,000,000 ... 2582,000,000 ... 130 ... — Exports of British

Produce 251,000,000 2223,000,000 ... 350 ... — Savings Banks De-

posits 224,500,000 ... 275,500,000 ... 200 ... — C riminal Convictions 34,000 ... 15,600 ... — 54 Paupers 201,000 ... 111,000 ... — ... 46

This comparison is decisive to show that a system of even one- sided Free-trade is not inconsistent with an enormous advance in national prosperity. The Fair-traders accordingly, driven from their first position, are compelled to take refuge in another, which, at first-sight, seems less exposed to attack, and insist that our wealth has increased as it has, in spite, and not in consequence, of Free-trade. The real cause of this gigantic progress, they assert, is to be found in the develop- ment of the Railway system and the invention of the electric telegraph, which have facilitated communication, brought distant markets near to us, and more than doubled the activity of trade. But the railway and the telegraph, as Mr. Glad- stone pointed out, are not peculiar to Great Britain ; they have been introduced into and adopted by every civilised com- munity in the world ; if, therefore, it is improved communica- tion, and not Free-trade, which has given such an unprece- dented impulse to British industry, it follows, by the ordinary rules of logic, that Protectionist countries must have equally benefited by the change. But what are the facts ? In 1879, the worst year of the recent depression—" the darkness of which called forth all the owls and bats of the country, and sent them croaking abroad "—the Foreign Trade of the British Islands, with a population of 35,000,000, amounted to £612,000,000. For the same year, the industrial position of our chief rivals, all of them, with the exception of Holland, Protectionist nations, is disclosed in the following table :—

Population. Foreign Ira le.

German Empire 40,000,00) 2371,000,000 United States 50,000,000 239,000,000 France 36,000,000 313,000,000 Russia 80,000,000 183,000,000 Holland 5,000,000 116,000,000

211,000,000 ... 21,222,000,000

In other words, these countries, the most naturally favourel and the most enterprising and energetic in the world, with a population exceeding ours in the proportion of six to one, car- ried on a trade which exceeded ours, in its whole aggregate, in the proportion of only two to one. If figures have any mean- ing, and if the inductive method has any logical validity, it is impossible to withstand such a conclusive vindication of the advantages of Free-trade. And if further proof were needed, it is to be found, as Mr. Gladstone showed, in the extra- ordinary development during the last thirty years of a branch of our industry with whose growth neither railways nor telegraphs can have had anything to do. Of all the struggles of the English Free-traders, the battle for the repeal of the Navigation Laws was the hardest fought and the latest won. When the victory was at last achieved, "appalling vaticina- tions, thick as the leaves in Vallombrosa,' " were showered over the country, and "the whole Protectionist party went into the deepest mourning." Never has a great legislative change been better justified by its fruits. The tonnage of our merchant shipping has increased in the in- terval more than sixfold, and above half of the entire sea- trade of the world has passed into our hands. The result becomes still more sttiking when the progress of the British marine, under the healthy stimulus of free competition, is compared with the contemporaneous decline of the American marine, which has all along been coaxed and fostered by Pro- tection. In 1850, four-fifths of the carrying trade between England and America was done by American, and only one- fifth by British ships. In 1880, the proportion had been exactly reversed.

In dealing with the recent depression, Mr. Gladstone did not content himself with showing, what has often been shown before, that the injury which we have sustained by the contrac- tion in our exports since 1873 is insignificant, in comparison with the loss of purchasing-power which has resulted from a succes- sion of deficient harvests, and which he estimates at not less than a hundred millions sterling. It is essential to the validity of such of the Fair-trade arguments as are founded upon the declining figures of our export trade, that two things should b3 capable of proof,—first, that the diminution in our exports is unique, and has not been accompanied by a corresponding de- crease in tariff-protected countries; secondly, that assuming retaliation to be our proper remedy, we have the means of making it effective for the purpose. Mr. Gladstone proved that on both points the Fair-traders entirely fail to make out their case. In the few cases in which during the last few years the exports of foreign countries to Great Britain have grown in volume and value, the increase has been mainly, if not entirely, in the raw products which form the staple of our manufactures, and in articles of food which we have needed to supplement our own deficient supply. But these are the very commodities in respect of which the countries which produce them neither need nor avail themselves of artificial protection, and which we, on the other hand, should be unable, under any conceivable tariff, to exclude or do without. The foreign tariffs of which we complain, and upon which we are asked to retaliate, are those which seek to foster native manufactures ; and the important question, therefore, is whether these protected industries have weathered the storm better than our own. Mr. Gladstone had no diffi- culty in showing that they have not. The exports of French manufactured goods fell from £49,000,000 in 1873 to £34,000,000 in 1879,—that is, by a greater per-centage than our own. In all the neutral markets of the world—in Asia, Africa, and Australasia—the supremacy of our manufacturers is as undisputed as it was ten years ago, and the annual exports of the United Kingdom to these three continents are nearly twenty times as great as those of the United States. Indeed, the prosperity of the United States, which is one of the stock instances of the Fair- traders, in so far as it can be said to depend on fiscal arrange- ments at all, is due to the fact that, while they are ready enough to avail themselves of protection against foreigners, they practise, and are forbidden by the specific provisions of their Constitution from abandoning, the principles of Free- ' Trade within the borders of their own vast territory, which includes almost every variety of climate, soil, and natural ad- vantage. But even if a case for retaliation had been made out, there remains, as a final argument against it, its complete impracticability. "If you are to strike," said Mr. Gladstone, "you ought to strike hard, and can you strike the

foreigner hard by retaliatory tariffs ? What manufac- tures do you import from abroad ? In all, £45,000,000. What manufactures do you export ? Nearly £220,000,000. You are invited to inflict wounds upon him on a field measured by £45,000,000, whilst he has got exactly the same power of inflicting wounds upon you on a field measured by more than £200,000,000." Strenuous at- tempts have been made, by Mr. Gladstone's critics, to detract from the effect of this simple but convincing exposure of our impotence for aggressive purposes in any war of tariffs that we may provoke. It is said, for instance, that by far the largest part of our exports find their way into neutral markets where there are no tariffs to keep them out, and that the amount of manufactured goods which we send to the protected countries, against which our vindictive measures would be directed, is little, if at all, greater than the amount which they send to us. But Mr. Gladstone anticipated this objection and answered it in advance. The greatest offender among our foreign rivals, and the one which would be the first object of the Fair- trade attack, is the United States. The value of the British manufactures which we export every year to the United States is about £30,000,000, while the value of the American manu- factures which they export to the United Kingdom is about £3,000,000. If, then, it comes to a tariff warfare between us, which of us stands to lose most in the struggle ?

It is, perhaps, too much to hope that the Conservative leaders will now allow the Fair-trade agitation to be decently interred in the grave which Mr. Gladstone has dug for it.

They doubtless find it hard to make up their minds to part company with what still seems to be such a promising alliance.

It is true that Sir Stafford Northcote has at last been goaded by Mr. Gladstone's challenge into a tardy disavowal of all con- nection with the proposed five-shilling duty upon corn. But he is, at the same time, constrained to express his admiration for "the great energy and ability, and considerable courage," with which " many in the Conservative Party have argued the question from a protective point of view." Mr. Lowther and Lord Randolph Churchill, who are, we presume, the persons whose remarkable qualities have won this tribute from their leader, are told that, for the present, at any rate, Protection is to be regarded only as " a pious opinion." Whether it is ultimately to be raised to the rank of an "article of faith," or degraded to that of a heresy, depends, we suppose, on the result of the next few county elections. Fair-trade may, for any- thing we know, become in time part of the official Tory creed ; but it cannot, after Mr. Gladstone's speeches, enter into the conscientious convictions of any man of common-sense.