TOPICS OF THE DAY.
tail BUDGET AND A REFERENCE TO THE PEOPLE.
MR. BALF01JR'S speech, and still more Mr. Cham- berlain's letter, show that it is the desire of the leaders of the Unionist Party that the Budget should be referred to the people. In principle we are at one with this plea for a, Referendum. If it were possible to take a poll of the people on the Budget pure and simple, and if the new system of taxation (which is so largely a system of taxation, not for revenue, but in order to gain many of the aims of Socialism through the instrument of taxa- tion) could be isolated from the other issues, we should not hesitate for a moment to endorse the demand for a Referendum. Unfortunately, however, the voters are not sufficiently instructed in the idea of taking a poll of the people, and in addition there is no machinery as yet available for this purpose. When a particular policy is referred to the people at a General Election, it is impossible not to mix up with the question specially referred all sorts of external and irrelevant problems. No doubt if, as now seems most probable, the Lords reject the Budget in order to ascertain the will of the voters thereon, the Budget will be the main issue at the election of a new Parliament which must be the sequel to the action of the Peers. But since it takes two to make the issue to be laid before the country, we may be pretty sure that the Liberal Party will not assent to the notion of asking the voters to vote simply on " the Budget, the whole Budget, and nothing but the Budget." They will as far as possible confuse the issue with a matter upon which the voters are very likely to be misled,—the question whether the Lords have a moral, even if they have a Con- stitutional, right to interfere with questions of taxation. We shall be told that the issue is not only the Budget, but also whether the Lords or the Commons are to sway the destinies of the nation,—whether the people are to govern themselves or be governed by the Peers. The fact that that is a false issue will by no means prevent the demagogues of the platform and of the Press doing their best to use it in the struggle. Further, the issue will be complicated by the introduction of the Fiscal controversy. Here both political parties will be content that this should be so. The Liberals will declare that the country has got to choose between taxes on the food of the people and taxes on the rich man's superfluities, while the Tariff Reformers will declare that Tariff Reform is the only alternative to the Budget, and that they are in possession of a fiscal secret which will enable them to give work to all. Thus, though the Election will be nominally a Referendum on the Budget, the electorate will, in truth, be puzzled by the innumerable cross- currents of Protection and Free-trade, and by charges and counter-charges as to constitutional and unconstitu- tional action.
Free-traders as we are, we see no reason in the new circumstances to alter our opinion that for the moment the essential thing is to get rid of the present Government and their policy of paying blackmail to the Socialists by granting them almost all they ask, and thereby intro- ducing Socialism under a mask which conceals its worst features. We have no fear of the people accepting Socialism when they can see its sinister features, but there is a real danger of their becoming committed to Socialistic legislation under the impression that they are doing some- thing which will neutralise Socialism In our view, the moderate men, the men of the Centre, who equally detest Socialism and Protection, must deal with the evil that is nearest,—must stop the runaway horse without thinking whether when it is stopped from plunging over the precipice the rider may not insist upon riding it against a high brick wall. Just as when Free-trade was the main issue at the polls we urged Free-traders to vote against Mr. Chamberlain's policy as the danger of the moment, without inquiring too closely into other and more remote perils, so now we would urge them to combat the Socialism of the Budget, of the Development Bill, and of the other and even more Socialistic proposals sketched by the Liberal leaders, without dwelling too much upon the perils of Tariff Reform. But though we recognise the necessity of adopting this policy, we desire—to continue our metaphor—that when trying stop the runaway horse we shall choose the -right moment, and shall seize the bridle at an advantage and :not a dis- advantage. But we are by no means convinced that this is the right moment. There is a hill between us and the precipice called Reaction, and there is a great deal to be said for stopping the horse there rather than on the level. The fact is, the policy of forcing an immediate Dissolution is a gamble. We do not care about gambles in politics at any time, and when the matter is so terribly serious as that now before the country we are specially disinclined to run unnecessary risks. After all, Budgets can be unmade as well as made, and success for the Unionists at an Election a year and a half hence, when the reaction -will be in full swing, is hardly a matter of doubt. We have written in what seems to us the only proper spirit in which to approach the -very difficult problem before the country,—in a, spirit of perfect candour, and without finesse or reserve or any of those economies of truth which politicians are too often inclined to practise. We should like to point out, however, that if we took the more cynical view of public affairs, and, looking on politics as a game, were to think merely of the interests of that section of the Unionist Party which we represent—namely, the Unionist Free-traders—we could make out a very good case indeed for feeling satisfaction with the decision in favour of the gamble, and for running the risk of the Budget proving to be, as the present Government and the Liberal managers unquestionably think it is, very popular with the electorate. It is exceedingly likely that the result of a Dissolution in November will, if it takes place, be either the return of the present Govern- ment with a greatly diminished majority, or of the Unionist Party with a narrow surplusage of voting power in the House of Commons. Either result would suit admirably those Unionist Free-traders who, like ourselves, though they dread most a victory for Socialism, dread also very greatly a victory for Tariff Reform. If the present Government come back with a greatly reduced majority, they cannot pass a Budget like the present, and they will have very little power for evil in the matter of Socialistic legisla- tion. The balance of power in the Liberal Party will then rest, not with the extremists like Mr. Lloyd George and Mr. Winston Churchill, but with the moderate men. On the other hand, if the Unionists come in with a majority of, say, some twenty or thirty over the Liberals, Irish, and Labour Members combined, they will have very little opportunity of carrying out their Tariff Reform principles in any way that is likely to prove injurious to the nation. The mandate they will have received—and, after all, such general mandates cannot help affecting policy—will be to pass a better Budget than the present and to check Socialism, but not to introduce Preference and Protection. In other words, the most they will be able to do for the Chamberlain policy will be something in the direction of what is called " broadening the basis of taxation,"— that is, of increasing the area of indirect taxation. The narrowness of their majority and the exigencies of raising revenue will oblige them to keep strictly within the limits of tariff, or rather taxation, for revenue only,—the true Free-trade principle, which, we may remark, is almost as much violated by the present Budget as by the fiscal policy which the extreme Tariff Reformers desire. Taxation for revenue will not give scope either for Preference or Protection, though it may possibly allow some plan for a national octroi under which every form of goods imported into these islands, whether raw material or manufactured articles, might bear an ad valorem import-tax of say, 3 per cent. To such a system of what we may call universal and Imperial harbour dues we see many serious objections, and no doubt the waste and friction produced would be very great. At the same time, the taxation would be taxation for revenue only, and would therefore in principle not differ from our present system of indirect taxes. The danger, of course—and this is a very real danger—would lie in the possibility of efforts to convert what we have called Imperial harbour dues into a regular tariff and to manipulate that tariff in the interests of particular industries, and thus to create a leakage which would soon destroy the value of such Imperial harbour dues from a revenue point of view. To repeat our proposition, if we were to think only of the interests of Unionist Free-traders we should make no protest against rejection by the House of Lords, since the chances are very much in our favour. As we have said, however, we regard. the matter as far too serious for a gamble, even though the gamble is much more likely to go in favour of the Unionist Free-traders than of the extreme Tariff Reformers.
Before we leave the subject we have one more thing to say. If the fight is to take place, we sincerely trust that, following Mr. Balfour's lead in this respect, other Unionist speakers and leaders will insist in season and out of season on the terrible injury which must be done to the interests of the poor man and of the working man by any and every system of State Socialism,—Socialism whether unmasked or disguised as social reform. We trust also that even if the party leaders, as we fear it is certain they will, insist on putting Tariff Reform forward as their fundamental policy, they will make it clear that they do not now pro- pose, and will not propose without further reference to the country, any taxation upon the staple forms of human food,- i.e., bread, meat, and dairy produce. If they will make such a declaration as this, they will go some way to render it possible for Unionist Free-traders to co-operate in the main work of inducing the country to put a. veto on Socialistic legislation and Socialistic finance. If they refuse to make such a declaration, but go to the country as Food- taxers, then we are certain that they will fight the battle under a disadvantage so great as to make the prospects of an immediate Dissolution from their point of view dark and precarious. It may seem strange that we, who are so much opposed to Tariff Reform, should find ourselves engaged in warning the Tariff Reformers against ruining themselves. That such a situation should have arisen is indeed a striking example of the greater ironies of politics, and of the colossal injury to the cause of Free-trade accom- plished by Mr. Asquith and his colleagues when they abandoned, in fact if not in name, the principles of free exchange, and adopted those of Socialism,—the evil-visaged twin-sister of Protection.
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