THE POLICY OF RETALIATION.
[To THE EDITOR OF TER " SPECTATOR:1 SIR,—It is obviously a commonplace, but none the less a principle constantly to be kept in view, that there are many things eminently desirable which are also, unluckily, un- attainable. Mr. Chamberlain's plan of a self-supporting Empire by means of a closer fiscal union with the Colonies appeals to most men, but most men—like Mr. Balfour—have arrived at the conclusion that meanwhile, at all events, it is unhappily not practical politics.
There still remains, as an alternative to our present system, the policy of retaliation, which to the natural man is in theory not only defensible but positively attractive. Other countries exclude our goods, we freely admit theirs ; why not warn them that if they do not follow our example and adopt Free-trade, we shall follow their lead and go in for retaliation,—not Protection, mark you, for the British advocates of import-duties are loud in their assurances that they propose these, not as good in themselves, but solely and simply as the most efficient, nay, the only, means of ultimately bringing about international Free-trade. There is no question here of protecting, as in Germany, infant industries. Our ideal is competition ; it is only unfair competition we object to. We may be sure, however, that mere threats will not always serve our purpose. Sometimes, perhaps often, we shall have to act upon them, and thus the puzzle we must solve comes to be : How will the new Government policy work out in practice ?
Take, for example, the linen trade, in which, though not what it was, many of us in Scotland and Ireland are still interested. The existing German tariff (the new one, not yet in force, makes matters worse) imposes an import-duty of twelve pfennigs per kilo, or some 10 per cent., on the sizes of linen yarns that are chiefly wanted in the Fatherland, with the result that British spinners have almost ceased to do business with Germany. Let us suppose that Mr. Balfour's Foreign Minister, Lord Lansdowne, or another, intimates to Count von Billow that this must end, or dermany must face the consequences. Count Von Billow declines to budge ; and Mr. Balfour, casting about for a German industry to penalise, fixes on the toy trade. Noah's arks, accordingly, if built in Germany, can only enter British ports on payment of an import-duty. But German makers cannot face the charge ; and the article comes to be made in Britain. The bitter cry of ruined German traders waxes louder and louder, the German Government becomes alarmed, and resolves, as the lesser evil, to eat its own words and to sacrifice the German flax spinners. The import-duty on British yarns is promptly taken off, and as a quid pro quo we, in our turn, are asked to admit German toys duty free as of old. But by this time British toy-makers, on the faith of protection against German competition, have entered upon large contracts, and have expended large sums on bigger premises and costly plant, and engaged a larger staff and more workpeople. How will they receive the news that, the sole object for which the duty was imposed having been happily attained, there is now no further object in taxing German toys, rind that these will in future come over as plentifully as ever ?
Ruined industries, Sir, under our existing arrangements, are hard to find, though unhappily we have some ; with successful retaliation in full blast they will be plentiful enough. As Unionists we can scarcely thank Mr. Chamberlain and Mr. Balfour sufficiently for their grand service to the State ; but in these fiscal matters we are each and all of us bound to exercise our own poor judgment. Colonial preference, Mr. Chamberlain admits, will not go down with the present-day elector. I would strongly urge that the party decline to commit themselves to retaliation either, at all events till we are absolutely clear how it would work out in detail. Mr. Balfour is a most able man, but he is not a business man ; and what on a priori grounds appears an im- pregnable position may prove weak indeed when it comes to be examined by those who, between them, know every inch of it. And, mark you, we are not dealing with harmless experiments merely. Once committed to this new departure, it will be difficult indeed, if not impossible, to retrace our steps.
[Our correspondent's point is a very strong one, and is supported by what came out in our correspondence columns when we were in search of an industry ruined by Free-trade. The best example produced after a diligent search was an industry from which protection was withdrawn as the
result of a bargain under Cobden's French Treaty. But what the Retaliators look forward to are more of such industry- slaying bargains.—ED. Spectator.]
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