THE IRON AND - STEEL TRADES AND THE TARIFF COMMISSION REPORT.
[TO THE EDITOR OF THE "SPECTATOR."]
SIR,—If the somewhat querulous letter from Mr. Hewins which you published last week is to be taken as a sample of his controversial methods, it will be necessary to reconsider the opinion I expressed as to the assistance he would be likely to give Mr. Chamberlain and the Tariff Reformers. The comments he makes on your editorial observations, and his kind endeavour to explain your meaning, I may leave on one side, since you yourself have passed on them criticism enough. Perhaps you will allow me to reply to that part of his letter which refers more directly to myself.
First, then, as to the evidence from the Income-tax Returns. Mr. Hewing rills-states my contention as to the interpretation to be put on these Returns. I said (and he does not contradict me) that the Income-tax Commissioners give no hint of any recent change in the way the Returns are made. I said that the iron trade undergoes great fluctuations, and I inferred that a very large increase of the profits assessed on ironworks need not cause surprise, any more than a large decrease need cause alarm. A great manufacturing concern owning its own minerals may at one time make its profits in one branch, and at another time in another. I fail to see how Mr. Hewins's group of firms, or the single firm of whose profits 12-53 per cent. was earned by "bye- products from blast furnaces," is any answer to my contention, which was that in the period under review the iron trade had participated with the country at large in the prosperity of that period. But had it been otherwise no concern need have been felt. If the country as a whole prospers, the prosperity of any particular branch of industry is of comparatively small im- portance, though a prosperous country is almost certain to mean a prosperous iron trade. Mr. Hewins asserts that I am "prepared to settle both the policy and its details at once by reference to the Income-tax Returns." I have neither said nor suggested any- thing of the kind. I have confined myself to pointing out that the marginal note, "Fallacy of Income-Tax Returns," is not justified by the facts, and that the attempt to dispose of the evidence from these Returns has not been successful. None of the evidence adduced, even when further expounded by Mr. Hewins, has, to my mind, explained away the awkward circum- stance of the absolute growth of our wealth.
Mr. Hewins says that I do not question any of the conclusions of the Report. It is impossible in a page of the Spectator to deal exhaustively with the voluminous Report of the Commission, but I did in terms express my astonishment that " Protection can be regarded as a possible policy" for the iron trade. I do not deny
"relative decline" of the industry, any more than I deny the statistics as to the area or the population of the 'United States of America or of Germany. But I do deny the relevancy of any of these statements to the matter in hand. On wrong data, wrongly interpreted, a non-existent disease is diagnosed, and a remedy is prescribed which would not cure the disease if it existed. If that be not questioning the conclusions of the Report, it is difficult to see how it can be done.
I have endeavoured to show both how the data are wrong and how they are wrongly interpreted. Mr. Hewins makes an observation on my liking for certain exercises in long division. They have afforded me considerable satisfaction, and I hope to enjoy them again in the future. In the meantime, will Mr. Hewins refer to the Blue-book Cd. 2,043, pp. 56-7 and 100-5, and reconsider his passing remark that it is I who include iron ore under "Iron and Steel," and not the Board of Trade? I will (since it suits Mr. Hewins's view and is not opposed to mine) set down some figures in which iron ore is not included. On the pages to which I have referred I find under the head "Iron and Steel" that our exports amounted in value to £30,387,423, and our imports to £8,713,128. (I have in each case deducted iron ore from the figures given in the Blue-book.) I am glad that the users of iron had the opportunity of purchasing this eight and three- quarter millions' worth of goods on terms which they regarded as advantageous, for it can only have been for this reason that they bought them. Great Britain sold goods to the value of three-and- a-half times as much abroad. I contend that, on the whole, what she sold was more costly and contained more labour than -what she bought. My " exercises " prove this to be the ease, and I do not want to see any hindrance put in the way of the con- tinuance of this state of matters. When I take the trade in its larger sense, I find that Great Britain sold goods to the value of £60,373,562, and bought similar goods to the value of £17,416,012. (Again I have deducted iron ore from the Returns.) For every pound's worth she bought she sold goods to the value of 69s. It is obvious that this kind of argument is not final. We import goods valued at £542,000,289; we export goods valued at £290,800,108. If we divided these' among the great branches of industry- of which they form the materials and the results, . we must end by finding some branch or branches in which the imports. exceed the exports. , For this reason it is necescary to take the trade of the country as a whole, and not to fix on some small division and, because it languishes, call for Protection. In spite of this reservation, I believe it to be true that the case for Protection might be taken on the iron trade, and so far as my examination has gone, I say that, even taken on that trade, it signally fails.
—I am, Sir, &e., KIIGH BELL.
Red Barns, Coatham, Reclear.
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